Exam 3 Review - Chapter 11: Place and Development of...

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Chapter 11: Place and Development of Channel Systems 19/03/2008 11:06:00 Marketing Strategy Planning Decisions for Place     Place  – Making goods and services available in the right quantities and  locations, when customers want them. *Exhibit 11.1 – Marketing Strategy Planning Decisions for Place Channel of Distribution  – Any series of firms or individuals who participate in the flow  of products from producer to final user or consumer Place Decisions are Guided by “Ideal” Place Objectives Use the product classes (summary of consumers’ urgency to have needs satisfied and  willingness to seek information, shop, and compare) to handle place decisions. Place system is not automatic Several strategies May not be one place arrangement that is best Place decisions often have long-run effects Harder to change than product, promotion, or price decisions Examples:     o Firms thought they could quickly establish effective websites for direct  online sales   Found it took several years and millions to work out the  kinks o Harder to move retail stores and wholesale facilities once they are set  up
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Channel System May be Direct or Indirect     Most basic place decisions producers must make: Direct o To handle the whole distribution themselves by relying on direct-to- customer e-commerce selling Indirect o Use wholesalers, retailers, and other specialists Direct  – Producers handle the whole distribution process themselves Why use direct distribution? o Direct-to-consumer e-commerce offers more control over the whole  marketing job (sometimes can offer lower prices, more effectiveness,  easier to change the marketing mix because more aware of customer  attitudes, fewer competitors) o The internet and e-commerce make this much easier Middlemen o Firm may need to go to direct distribution if a suitable middlemen is not  available or won’t cooperate o Have the best contacts with the target market but may be hesitant to  add unproven vendors or new products Business products o Many business products are sold direct to consumer because of fewer  transactions, larger orders, concentration in geographic areas, ease of  re-order through e-commerce once relationships are established o Many service firms use direct channels Direct selling (not really direct producer-to-consumer distribution) o Involves personal sales contact between a representative of the  company and an individual consumer o Most “salespeople” are not company employees   Usually work as  independent middlemen (dealers, distributors, agents)
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This note was uploaded on 04/22/2009 for the course MKT 320F taught by Professor Miller during the Spring '08 term at University of Texas at Austin.

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Exam 3 Review - Chapter 11: Place and Development of...

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