14.2 and 14.3: Product Attributes and Distribution Strategy Flashcards
What are product attributes and why are they important?
Product attributes include features such as size, taste, power, design, quality, and comfort.
They are important because they need to match consumer needs and preferences to ensure a product’s success in the market.
How do cultural differences influence product attributes?
Cultural differences, including traditions, religion, and social norms, significantly impact consumer preferences and thus dictate the need for firms to adapt product attributes to fit local tastes and behaviors.
Why must firms consider economic development when determining product attributes?
The level of economic development affects consumer purchasing power and demand for certain product attributes.
Consumers in less developed countries may prefer more basic products due to cost constraints, while those in developed countries often seek additional features and innovations.
How do product and technical standards affect the globalization of products?
National differences in product and technical standards can constrain the globalization of markets, often necessitating that products be modified to meet regional standards or preferences.
What is a distribution strategy in a firm’s marketing mix?
A distribution strategy refers to how a firm chooses to deliver its products to the consumer. It includes decisions on selling directly to the consumer, using intermediaries like wholesalers and retailers, or establishing its own channels.
How does retail concentration vary between countries?
Retail concentration can vary widely, with some countries having a few retailers supply most of the market (concentrated retail systems) and others having many small retailers with no major market share (fragmented retail systems).
What is channel length and how does it affect distribution?
Channel length refers to the number of intermediaries between the producer and the consumer.
Longer channels can arise from fragmented retail systems and may involve multiple layers of wholesalers, which can increase the cost and complexity of distribution.
What is channel exclusivity in distribution?
Channel exclusivity occurs when access to retail space is limited to established or preferred vendors, often making it challenging for new firms to gain market access.
Why is channel quality important in distribution?
Channel quality is crucial as it relates to the expertise and skills of retailers to sell and support a company’s products.
Poor channel quality may necessitate significant investments in education and support infrastructure for the channel to be effective.
What factors influence the choice of a distribution strategy?
The choice of distribution strategy is influenced by retail concentration, channel length, exclusivity, and quality.
Firms must consider the relative costs and benefits of each option, including the impact on the final selling price, profit margins, and market access.
