Download Chapter 6: notes

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CHANNELS OF DISTRIBUTION Chapter 6.2
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Channel of Distribution
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The path a product takes from the producer or manufacturer to the consumer
1. –
2. –
3. –
1. ct distribution
2. of Distribution
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Direct Channels
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When the product goes directly from the producer to the consumer, there are no intermediaries.
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Examples:
SRI sports sells its Astroturf directly to colleges & pro sports teams
Reebok has its own website where customers can purchase products directly from the factory
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SRI Field
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Distributing Services
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Services are distributed directly to consumers
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Examples
Personal trainers
Haircuts
Online Fantasy Sports
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Sporting events are considered services, so buying tickets from a team’s box office is an example of direct
distribution
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Direct Marketing
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Marketing activities used to sell products directly to the customers
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Companies can use an existing customer database or a list of potential clients
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They can do this through:
Telephone Sales
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Print
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telemarketing
catalogs
Television
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infomercials & Shopping networks (HSN)
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Email & Internet
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customized emails with products and links to websites
Indirect Channels
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The path a product takes using intermediaries between the producer and consumer
Example:
A
sporting goods manufacturer sells its products to Sports Authority who then sells them
to consumers
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Types of Intermediaries
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Agents
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Bring buyers and sellers together for a fee, they do not take ownership of the goods
Ex. Ticketmaster
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Wholesalers
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Resellers who buy goods, store them and sell them in smaller quantities to retailers
Retailers
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Resellers who sell their goods directly to he customers
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Ex. Modell’s
Multiple Channels
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Producer uses more than one type of distribution channel
Ex. Nike
has its own website and retail stores to sell its products directly to customers
Also sells its products to other retailers such as Footlocker, who in turn sells them to customers
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Manufacturer/Producer
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Questions
1. What does the place decision involve?
2. List Several direct distribution methods ?
3. What are three basic types of intermediaries in an indirect channel of distribution?