Marketing 304: Distribution, Retailing, and Pricing Strategies Exam Review

Distribution

All activities involved in moving products from producers to customers.

Distribution Channels

Paths that goods take from producer to consumer.

Intermediaries

Middlemen who reduce transaction costs and increase efficiency.

Direct vs. Indirect Channels

Direct connects producer to consumer; Indirect involves intermediaries.

Channel Utility Types

Time, Place, Possession, and Form utility.

Distribution Strategies

Intensive, Selective, and Exclusive distribution.

Channel Integration

Coordination between levels (e.g., Vertical Marketing Systems).

Wholesaling

Wholesalers resell to businesses.

Retailing

The final stage of the distribution process where goods and services are sold to end consumers for personal or household use.

Types of Retailers

Department stores, discount, convenience, warehouse clubs, specialty, and non-store retail (online, vending, franchising).

Product Mix Strategies

Product mix width (# of lines) and depth (# of items per line).

Retail Planning Elements

Product mix, location, and store atmosphere.

Cross-shopping

Overlap in customers between competitors.

Price

The only marketing mix element that directly generates revenue.

Two Types of Competition

Price vs. Non-Price competition.

Demand Curves

Show relationship between price and quantity sold.

Price Elasticity of Demand

Sensitivity of demand to price changes.

Elastic demand

Sensitive to price changes.

Inelastic demand

Insensitive to price changes.

Marginal Analysis

Profit maximization occurs when MR = MC.

Break-even Analysis Formula

BEP = Fixed Costs / (Price - Variable Cost).

Cost Types

Fixed costs remain constant; variable costs increase with sales volume.

Price Setting

Aligns firm goals with customer value, market conditions, and competition.

Cost-Based Pricing

Add markup to cost.

Competitive-Based Pricing

Set relative to competitors.

Demand-Based Pricing

Center on perceived value and willingness to pay.

Pricing Strategies

Differential, Skimming, Penetration, Psychological, Product-Line, Professional, Promotional.