MARKETING MIX-PLACE

MARKETING MIX-PLACE

LEARNING OBJECTIVES:

1. Understand the role of distribution channels

2. Understand the different methods of distribution

3. Understand the role played by e-commerce in distribution.

Multiple Select

What is Place?

• Place is one of the 4Ps in the marketing mix.

• Place refers to the location where people can buy products.

• Place is how your product is bought and where it is bought.

• Place refers to distribution or the methods and location a business uses for products or services to be easily accessible to the target customers

Open Ended

WHAT DO YOU KNOW ABOUT DISTRIBUTION CHANNELS?

Define the terms:

Distribution channels

Intermediary

Wholesalers

Distribution Channels

This is simply focuses on how the product 'travels' from the producer to the consumer. Distribution channels provide time, place, and ownership utility. 

Distribution Methods/ Channels includes:

Retailing

Wholesaling

E-tailing/ E-commerce

Direct selling

Agents or brokers

Intermediary

This is a person or organisation that helps to arrange agreements or business deals between other people or organizations.

Wholesalers

These are people or businesses that buy goods from manufacturers and sell them in smaller quantities to retailers. Wholesalers may break bulk, repack goods, redistribute smaller quantities, store goods and provide delivery services. A wholesaler stock goods by many manufacturers. Therefore retailers get to select from a wide range of products.

Businesses consider certain factors when choosing their distribution channels. They include:

• The nature of the product

• Cost

• The market

• Control

Open Ended

What level of distribution channel would you recommend for a person selling perishable goods like agricultural products? Give at least one reason for your answer.

Fill in the Blanks

Fill in the Blanks

RECAP

• Place refers to the location where people can but products. E.g. online, supermarket, kiosk, etc.

• Distribution channels refers to how a product travels from the producer to get to the consumer(s).

• An intermediary is a person or organisation that helps to arrange business deals between other people or businesses.

• Distribution channels include: retailers, wholesalers, e-commerce, direct selling and agents.

Open Ended

Imagine that you have to buy most of your grocery items directly from the manufacturers.

Do you think the transactions would be convenient? Give reasons for your answers.

Retailers provide manufacturers and other sellers with some key services.

• They buy large quantities from manufacturers and wholesalers and sell small quantities to customers.

• They sell in locations that are convenient to consumers. Most supermarkets, for example, are conveniently located and have good parking facilities.

• They may add value to products by providing other services like packing, delivery, repair services, information about products. guarantees and gift wrapping.

Class reading- SOME COMMON TYPES OF RETAILERS

Google Classroom

Open Ended

What type of retailer is Walmart?

Fill in the Blanks

Agents or Brokers

The role of an agent or broker is to link buyers and sellers. They are used in a variety of markets. For example, travel agents sell holidays and flights for holiday companies, airlines and tour operators. Estate agents sell properties on behalf of vendors. Agents are also used to sell insurance, mortgages and other financial products.

Open Ended

Give three examples of products that agents would make available to the final consumer.

Examples of products agents and brokers offer to consumers includes:

•  insurance

• real estate

• vehicle sales

• alarms

• telephone or cable TV subscriptions,

• Health Management plans

• Investment opportunities/ loans, etc.

Open Ended

List one major difference between agents and brokers.

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Open Ended

Mention one outstanding difference between wholesalers and agents or brokers.

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Homework- E-poster on E-tailing

See Google Classroom for guidance.

Multiple Choice

Which of the following is a service provided by retailers?

• wholesaling

• Market research

• bulk breaking

• advertising

Multiple Choice

Which of the following is a unique feature of a chain store?

• Usually located on brownfield sites

• offer a wide range of products

• staff are highly trained

• offer a standardized product range

Multiple Choice

Door -to-door selling is an example of which type of selling?

• direct selling

• wholesaling

• retailing

• e-tailing

Multiple Choice

Which of the following is a benefit to consumers to e-tailing?

• low start-up costs

• consumers can shop from any location if they have access to the internet

• Businesses have more choice when locating their operations

• Consumers receive excellent after sales service

Open Ended

List five methods of direct selling.

Methods of direct selling include:

• direct mail

• shopping parties

• telephone retailing

• Mail order catalogues

• Door-to-door selling

• Direct response adverts

CASE STUDY: UNILEVER

SEE GOOGLE CLASSROOM

Open Ended

CASE STUDY: UNILEVER

What is meant by distribution in business?

Case study: Unilever

1. Distribution is the movement of goods from the supplier to the customer.

Open Ended

Case study: Unilever

Describe the method of distribution used by Unilever.

Describe the method of distribution used by Unilever.

Unilever has its own sales force but also uses independent brokers, agents and distributors. It sells to chain stores, wholesalers, cooperatives, independents, food service distributors and institutions. Products are transported through a network of distribution centres, warehouses, company-operated and public storage facilities and other facilities. Their popular brands can be bought in a very wide range of retail outlets from small independents to giant supermarkets, all over the world.

Open Ended

Discuss one reason for Unilever's approach to distribution.

Discuss one reason for Unilever’s approach to distribution.

Unilever appears to use a mass distribution approach. It uses many different outlets to sell its products. This approach allows Unilever to sell large volumes all over the

world. As a result, it is able to generate large revenues. For example, in 2015, the company enjoyed sales revenue of €53300 million. If Unilever were more selective about its distribution network, it would be more difficult to generate such high levels of sales.

CASE STUDY: BATA

Open Ended

What is the main difference between retailers and wholesalers?

What is the difference between retailers and wholesalers?

Wholesalers usually buy from manufacturers and sell to retailers. Some wholesalers are called cash and carries. This is because customers can come to the store, buy goods, pay cash and take goods away with them. Wholesalers may break bulk, repack goods, redistribute smaller quantities, store goods and provide delivery services. A wholesaler stocks goods produced by many manufacturers. Therefore retailers get to select from a wide range of products.

What is the difference between retailers and wholesalers?

Retailers are businesses that buy goods from manufacturers or other suppliers and sell them to consumers. Retailers provide manufacturers and other sellers with some key services. They buy large quantities

from manufacturers and wholesalers and sell smaller quantities to customers. This is called bulk breaking and is the main function of retailers. However, they may add value to products by providing other services. These might include help with packing, delivery, repair services, information about products, guarantees and gift-wrapping.

Open Ended

Describe two features of a chain store like Bata.

Describe two features of a chain store like Bata.

One approach to retailing is to develop a chain of stores. This is where one owner or company opens multiple stores selling the same range of goods in many different locations. In this case, Bata has around 5000 stores selling footwear. Each store in the chain will look very much the same and be under the control of a central office. Stores will usually have a standardised product range. This means that each shop will have almost exactly the same products for sale – shoes and other footwear in the case of Bata. Another feature of chain stores is that the facia and layout will be almost exactly the same in every store wherever it is located. 

Open Ended

Discuss the main advantage to Bata of manufacturing shoes and selling them through its own chain stores.

Discuss the main advantage to Bata of manufacturing shoes and selling them through its own chain stores.

Bata also manufactures footwear. It has 26 manufacturing units in 18 different countries. The main advantage to Bata of manufacturing its own shoes is that the intermediary is removed. This means that Bata makes more money because it enjoys the profit margins that the intermediary (perhaps a wholesaler) would normally take. This will increase the profitability of the whole business. It also means that Bata’s manufacturers have guaranteed outlets for their output.

Open Ended

CASE STUDY: ROLEX

Describe the method of distribution used by Rolex.

Describe the method of distribution used by Rolex.

Rolex is very selective about where its wristwatches are sold. Rolex watches are only available in a select number of official Rolex retailers. It is important that each outlet has the necessary skills and technical know-how to guarantee the authenticity of each and every part of a Rolex, and to help customers to choose the right model that will last a lifetime. This helps to control the environment in which they are sold and to avoid the sale of fake watches

Open Ended

Discuss one possible reason why Rolex watches cannot be purchased online.

Discuss one possible reason why Rolex watches cannot be purchased online

One reason why genuine Rolex watches cannot be purchased online is because Rolex wants to reduce the number of fake watches that are sold under its brand name. It is much easier to sell ‘fake’ products online since customers cannot touch and look at goods before they are purchased. Rolex claims that none of their watches will be sold online. Therefore, anyone that buys a Rolex from this source is taking a great risk – it is unlikely to be a genuine Rolex

Further Reading

https://laptophustle.com/distribution-channels-definition-types-functions/