ch. 13

distribution mix

combination of distribution channels by which a firm gets its products to end users

distribution channel

network of interdependent companies through which a product passes from producer to end user

direct channel

distribution channel in which a product travels from producer to consumer without intermediaries

intermediary

individual or firm that helps to distribute a product

wholesaler

intermediary who sells products to other businesses for resale to final consumer

retailer

intermediary who sells products directly to consumers

retail distribution

- requires a large and costly amount of floor space for storing and displaying merchandise at brick-and-mortar facilities

- wholesalers relieve the space problem by storing merchandise and restocking store displays frequently

wholesalers

- independent operations that buy products from manufacturers and sell them to various consumers or other businesses

- usually provide storage, delivery, and addition of value-adding services, including credit, marketing advice, and merchandising services, such as marking prices and setting up displays

sales agent

independent intermediary who generally deals in the related product lines of a few producers and forms long-term relationships to represent those producers and meet the needs of many customers

broker

independent intermediary who matches numerous sellers and buyers as needed, often without knowing in advance who they will be

distribution strategies

intensive distribution, selective distribution, exclusive distribution

intensive distribution

a product is distributed through as many channels as possible

exclusive distribution

a manufacturer grants exclusive rights to distribute or sell a product to a limited number of wholesalers or retailers in a given geographic area

selective distribution

a company uses only wholesalers and retailers who give special attention in sales effort to specific products

channel conflict

conflict arising when the members of a distribution channel disagree over the roles they should play or the rewards they should receive

channel captain

channel member who is the most powerful in determining the roles and rewards of other members

merchant wholesaler

independent wholesaler who takes legal possession of goods produced by a variety of manufacturers and then resells them to other organizations

kinds of merchant wholesalers

full service merchant wholesaler, limited function merchant wholesaler, drop shippers

full service merchant wholesaler

merchant that provides credit, marketing, and merchandising services in addition to traditional buying and selling services

limited function merchant wholesaler

merchant wholesaler that provides a limited range of services

drop shippers

limited function merchant wholesaler that receives customer orders, negotiates with producers, takes title to goods, and arranges for shipment to customers

E-intermediary

Internet distribution channel member that assists in delivering products to customers or that collects information about various sellers to be presented to consumers, or they help deliver online products to buyers

syndicated selling

e-commerce practice where by a website offers other websites commissions for referring customers

shopping agent (e-agent)

e-intermediary (middle man) in the Internet distribution channel that assists users in finding products and prices but does not take possession of products

classifications of brick and mortar outlets

product-line retailers

bargain retailer

convenience store

types of product-line retailers

department store, supermarket, specialty store

department store

large product-line retailer characterized by organization into specialized departments

supermarket

large product-line retailer offering a variety of food-related items in specialized departments

specialty store

retail store carrying one product line or category of related products

bargain retailer

retailer carrying a wide range of products at bargain prices

types of bargain retailers

discount house, catalog showroom, factory outlet, wholesale club

discount house

generates large sales volume by offering goods at substantial prices reductions

catalog showroom

customers place orders for catalog items to be picked up at on-premises warehouses

factory outlet

owned by the manufacturer whose products it sells

wholesale club

offers large discounts on brand-name merchandise to customers who have paid annual membership fees

convenience store

retail store offering easy accessibility, extended hours, and fast service

kinds of nonstore retailing

vending machines, direct-response retailing

vending machines

card- and coin-operated machines

direct-response retailing

form of nonstore retailing in which firms directly interact with customers to inform them of products and to receive sales orders

- mail order (catalog marketing)

- telemarketing

online retailing

nonstore retailing in which information about the seller's products and services is connected to consumers' computers, allowing consumers to receive the information and purchase the products in the home

kinds of online retailing

e-catalog, electronic storefront, cybermall, video retailing

e-catalog

digital version of physical \___? catalogs

electronic storefront

commercial website at which customers gather information about products and buying opportunities, place orders, and pay for purchases

cybermall

collection of virtual storefronts (business websites) representing a variety of products and product lines on the Internet

video retailing

nonstore retailing to consumers via home television

physical distribution

activities needed to move a product efficiently from manufacturer to consumer

warehousing

physical distribution operation concerned with the storage of goods

- private/public warehouses

private warehouse

warehouse owned by and providing storage for a single company

public warehouse

independently owned and operated warehouse that stores goods for many firms

transportation modes

trucks

planes

digital transmission (ex: TV subscription)

water carriers

railroads

pipelines

drones??

promotion

aspect of the marketing mix concerned with the most effective techniques for communicating information about and selling a product

positioning

process of establishing an identifiable product image in the minds of consumers

promotional mix

combination of tools used to promote a product

- two types of strategies: push and pull

pull strategy

designed to appeal directly to consumers who will demand a product from retailers

push strategy

designed to encourage wholesalers or retailers to market products to consumers

stages in the buyer decision process

1. problem/need recognition

2. information search

3. evaluation of alternatives

4. purchase decision

5. post-purchase behavior

advertising

promotional tool consisting of paid, nonpersonal communication used by an identified sponsor to inform an audience about a producer

advertising media

variety of communication devices for carrying a seller's message to potential customers

media mix

combination of advertising media chosen to carry a message about a producer

US advertising mediums (table 13.2)

TV, Internet, direct mail, newspapers, radio, magazines, outdoor

personal selling

promotional tool in which a sales person communicates one-on-one with potential customers

salespeople engage in:

order processing, creative selling, missionary selling

order processing

receive order and see to their handling and delivery

creative selling

try to persuade buyers to purchase products by providing information about their benefits

missionary selling

promote their firms and products rather than try to close sales

the personal selling process

1. prospecting and qualifying

2. approaching

3. presenting and demonstrating

4. handling objections

5. closing

6. following up

prospecting

salespeople identify potential customers

qualifying

sales people determine whether prospects have the authority to buy and ability to pay

closing

salespeople ask prospective customers to buy products

sales promotion

short-term promotional activity designed to encourage consumer buying, industrial sales, or cooperation from distributors

sales promotion techniques

coupon

samples

contests

premium

loyalty programs

point of sale (POS) display

trade show