Marketing III:Distribution & Advertising

BBI2O

Distribution Channels

• The path that goods follow to get from producer to consumer

• Three types:• Direct• Indirect• Specialty

Direct Channels

• Consumer buys directly from the producer• Ex: farmer’s market, bakery, factory

outlet, or factory-run stores like Ikea or Roots

• No intermediaries means less cost added to product• Consumer pays less by buying direct• Manufacturer can sell to the consumer

for a higher price than they would to a wholesaler

Indirect Channels

• One or more intermediaries between producer and consumer• Importers: Bring in goods from foreign

manufacturers• Wholesalers: Buy goods from the

manufacturer in large quantities, then distribute them more locally in smaller quantities to retailers

• Retailers: Sell goods directly to consumers

Specialty Channels

• Indirect channels that do not involve a traditional retail store• E-Commerce• Vending machines• Telemarketing• TV sales• Catalogues• Door-to-door sales

E-Commerce

• What are the pros and cons of buying online for the consumer?

• For what types of goods is e-commerce not as appropriate?

• How has e-commerce impacted traditional distribution channels?

Advertising

• Paid-for promotion of a business’s goods/services

• Can have different goals…• How might the goals of advertising

change over the course of the PLC?

Types of Advertising

• Direct-to-home (i.e. flyers)• Print (magazines, newspapers)• Billboards• Transit ads (i.e. on buses, shelters)• Television• Radio• Internet

Types of Advertising

• The more people the ad can potentially reach, the more expensive the ad• This is why ads during the Superbowl

are so expensive• A marketer doesn’t want to have

to pay to reach people who are not in its target market

• Ideally, the ad is targeted to reach only those people who are potential customers

Types of Advertising

• What would be the best type of advertising for…• Etnies skate shoes• Maroush Shawarmas• A Dodge minivan• A Corvette• MAC cosmetics

Headline

Illustrations

Copy

Signature

Signature

Illustrations

Headline

Copy

Other types of promotion

• Coupons• Contests• Premiums/giveaways• Samples