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Marketing > Chapter 7: Place > Flashcards

Chapter 7: Place Flashcards

0
Q

What do you call how you get products to customers?

A

Distribution channel

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1
Q

What is place also called?

A

Distribution

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2
Q

What is a distribution channel?

A

Means of getting products to customers

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3
Q

There are various functions a distribution channel needs to perform to be

A

Effective

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4
Q

What are the types of functions of a distribution channel?

A

Transactional
Logistical
Facilitating

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5
Q

What are the transactional functions?

A

Transfer of ownership

Taking risk

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6
Q

What is the transfer of ownership?

A

Arranging for title of the goods to be transferred from producer to the customer

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7
Q

The transfer of ownership differs for

A

Simple purchases

Complex products

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8
Q

For simple purchases, the title is transferred when

A

Physical goods are passed over

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9
Q

For complex products, what is required for the title to be handed over?

A

Formal processes by distributor

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10
Q

Why do distributors take risk?

A

They buy in bulk from manufacturer

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11
Q

To lessen risk, what do distributors have to do ?

A

Protect goods

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12
Q

What kinds of risks do distributors face?

A

Spoilage

Obsolescence

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13
Q

Spoilage of goods can be due to

A

Weather
Theft
Accidents

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14
Q

What is obsolescence of goods?

A

Remaining products not sold off in time

Outdated

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15
Q

What are the logistical functions performed by distributor?

A

Handling, storage, transportation
Sort, provide assortment, and grading
Providing pre and post sale service

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16
Q

What are the locations a product goes through after manufacturing

A

Factory
Warehouse (other country)
Retailers

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17
Q

The transportation of a product from factory to other counties is

A

Shipping

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18
Q

What kind of products need to be handled specially?

A

Products with special product requirement

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19
Q

Goods that have special requirements need what kind of handling?

A

Fragile handing
Refrigeration
Higher security

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20
Q

What does the distribution channel need to ensure at the end of handling, storage and transporting?

A

Goods arrive at retail store in saleable condition

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21
Q

When does sorting occur?

A

Product leaves the factory

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22
Q

Why does the distribution channel is sort the product?

A

Separate and group them from other products

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23
Q

When does providing assortment occur?

A

Before they reach the consumer

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24
Q

What is adding assortment also known as?

A

Giving more variety

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25
Q

How do distribution channels provide assortment?

A

Buy from other producers

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26
Q

Why is grading necessary?

A

defective products discarded

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27
Q

When do distribution channels need to provide pre-sales service?

A

Before consumers use product

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28
Q

What pre sales services do distribution channels provide?

A

Inspection for compatibility
Training courses
Installation services

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29
Q

What kind of post sales service do distribution channels provide?

A

Servicing and repairs for defects

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30
Q

What are the facilitating functions?

A

Providing information
Financing the product
Enhancing the attractiveness

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31
Q

For what kind of product do distribution channels need to provide information?

A

Complex

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32
Q

What kind of information can distribution channels provide?

A

Technical guidance

Specific situational instructions

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33
Q

How do distribution channels provide information?

A

Consider carefully
Plan
Available sources to provide them

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34
Q

Why is providing information by distribution channels so important?

A

customers would feel dissatisfied

Switch to buy from other companies

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35
Q

For simple products, information can be found

A

Pasted on label
Inserted into packaging
Download from the website

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36
Q

Why do distribution channels need to finance the product?

A

First payment to manufacturer
Different payment options
Payment plans

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37
Q

Why do distribution channels need to pay the manufacturer for the product first?

A

Take time for it to be sold to end customers

From factory to retail outlets

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38
Q

Why are different payment options offered?

A

To make it easier for customer to own the product

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39
Q

What are the types of payment options?

A

Cash
NETS
Flashpay

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40
Q

Why are payment plans provided?

A

Products are costly and customers cannot pay in full

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41
Q

What are the payment plans?

A

Credit terms

Installment

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42
Q

Why do distribution channels need to enhance the attractiveness of a product?

A

To make it more appealing to the customer

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43
Q

How do distribution channels enhance the attractiveness of a product?

A 
Repackage
Add labels
Pretty carrier bags
Advertising banners, posters
Design retail display shelves or area
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44
Q

What are the members in the distribution channel also known as?

A

Intermediaries

Middlemen

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45
Q

What are the members in the distribution channel?

A

Agents
Wholesalers
Retailers

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46
Q

Who do agents work for?

A

Acts of behalf of manufacturers

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47
Q

How are agents different from manufacturers?

A

They never take possession of the goods

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48
Q

What do agents do?

A

Assist in transfer of title of goods

Provide services

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49
Q

What services do agents provide?

A

Credit
Shipping options
Advice

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50
Q

What are the two kinds of wholesalers?

A

Merchant wholesalers

Licensed distributors

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51
Q

What do merchant wholesalers do?

A

Buy in bulk from manufacturers/agents
Takes title and possession of goods
Stores and transports them
Resells to retailers

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52
Q

What is the difference of a licensed distributor?

A

They are wholesales and retailers

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53
Q

What are the types of retailers?

A

Exclusive
Specialist
General-merchandise
Discount

54
Q

What does an exclusive retailer sell?

A

products from one manufacturer or brand

55
Q

What does a specialist retailer sell?

A

Selling products in a specialised category

56
Q

What are general merchandise retailers?

A

Sell products from a mixture of categories

57
Q

What do discount retailer sell?

A

Products from a mixture of categories

Do not carry specific products permanently
Rely on sourcing for cheaper merchandise to price at lower prices

58
Q

What are the two broad categories of distribution channel designs?

A

Direct

Indirect

59
Q

How do manufacturers behave in direct distribution?

A

Go directly to consumers

Without intermediaries

60
Q

What is the advantage of direct distribution?

A

More control over how products are marketed

61
Q

What is the disadvantage of direct distribution?

A

Incurs more cost

Fund all operations
Organisation of marketing activities

62
Q

How does the manufacturer behave in indirect distribution?

A

Sells to consumers

With the help of one or more levels of intermediaries

63
Q

What is the advantage of indirect intermediaries?

A

Incur less cost
Cost is shared

Funds needed to operate
Organising of marketing activities

64
Q

What is the disadvantage of indirect distribution?

A

Less control of how products are marketed

65
Q

How many combinations are there for indirect distribution?

66
Q

The choice of channels can be categorized as?

A

Single

Multiple

67
Q

What is the advantage of single channel?

A

Less complexity

Less potential conflict when scope overlaps

68
Q

When is there a single channel?

A

When manufacturer takes on 1 alternative

69
Q

When is there multiple channels?

A

When the manufacture takes on multiple alternatives

70
Q

When do manufacturers use multiple channels?

A

Reach 2 or more markets

Avoid complete dependency

71
Q

How do companies reach 2 or more target markets with multiple channels?

A

Different service level
Different prices
Different customer segment

72
Q

Why do companies avoid being too dependent on a single distribution arrangement?

A

Too limited to reach out to sufficient customers

73
Q

What makes up a traditional distribution channel?

A

Firms that are independent

Focused on its own interest

74
Q

What are the downsides of traditional distribution channel?

A

Not effective channels

Contributed to conflict (optimize their obj)

75
Q

What is a VMS?

A

Vertical marketing system

76
Q

How are members in a vertical marketing system?

A

Tightly coordinated

77
Q

What are the advantages of VMS?

A

Operating efficiencies

Marketing effectiveness

78
Q

What are the types of VMS

A

Corporate
Administered
Contractual

79
Q

When is it a corporate VMS?

A

Successive levels of a channel that are owned by one organisation

80
Q

What is it an administered VMS?

A

One member in the channel has more power to dictate

81
Q

When is it a contractual VMS?

A

Channel members enter into contracts based on how they want to distribute

82
Q

What are the broad considerations in choosing the right distribution channel?

A

Market
Product
Middleman
Company

84
Q

What are the market considerations?

A

Frequent & amount
Number of potential customers
Geographical concentration

85
Q

What distribution is used for high frequent purchase pattern and large purchase amounts

A

Wide distribution
Indirect channels
Various intermediaries

86
Q

When the number of potential customers (big in size purchase) are few, what distribution is required?

A

Great control on marketing
Direct channel
Or fewer intermediaries
VMS

87
Q

What are the product considerations?

A

Unit value
Perishableness
Technically complexity

88
Q

What is the distribution for high unit value products? Why?

A

Direct channel, fewer intermediaries
VMS

More control over marketing of product

89
Q

For perishable products, what channel is better? Why?

A

Direct channel, fewer intermediaries

Reach end consumer quickly

90
Q

Other than goods, what is considered perishable too?

91
Q

The higher the technical complexity, what is the distribution channel? Why?

A

Direct, or fewer intermediaries

More detailed knowledge required
Pre and post sales

92
Q

What are the middlemen considerations?

A

Ability

Availability

93
Q

How is a middleman more able?

A

Provide marketing services that manufacturer cannot

Or cannot do economically

94
Q

When is a middleman available?

A

Intermediary engaged with competitive product (don’t want to take up another line or brands)

Middleman have incompatible marketing policies

95
Q

What are the company considerations?

A

Financial resources
Management ability
Channel control

96
Q

The more financially stronger a manufacturer is, the

A

Less they depend on intermediaries

Build their own direct channel

97
Q

What is management ability is based on?

A

Marketing know how

98
Q

If there is good marketing know how, what channel is better? Why?

A

Direct
VMS

More control

99
Q

What are the products that require high channel control?

A

Fresh
Controlled prices
Follow strict promotional standards

100
Q

Manufacturers that desire more control use what channel?

A

VMS

Direct, shorter channels

101
Q

What are the levels of intensity of distribution?

A

Intensive
Selective
Exclusive

102
Q

What is the highest level of distribution?

103
Q

Where do manufacturers sell their product in intensive distribution?

A

Every available market outlet

104
Q

When is an intensive level of distribution required or more effective?

A

Immediate satisfaction

Low value, bought frequently

Insignificant proportion of consumer life

105
Q

What will the customer not do when the product is for immediate satisfaction?

A

Will not make special effort to purchase it

Or defer purchase

106
Q

When a product contributes insignificantly to a consumers life, what does it mean?

A

Used for a short time

Inconspicuous

107
Q

What type of products are intensively distributed?

A

Convenience products

108
Q

When customers are geographically concentrated, what channel is required? Why?

A

Direct channel

More effective

109
Q

Where does selective distribution fall?

A

In between exclusive and intensive

110
Q

Through whom does the manufacturer sell at in selective distribution?

A

Multiple wholesalers and retailers in market

Where customer can reasonably look for it

111
Q

When is selective distribution used?

A

Shopping goods, mid to high value, not bought so frequently
Brand preference (effort to locate and purchase)
Significant proportion of consumers life

112
Q

How is a product contributing significantly to a consumer’s life?

A

Use a few hours

Seen in public, conspicuous

113
Q

Because a product contributes significantly to a persons life, how does he make a purchase?

A

Time and effort into purchase
Product searched online
Visit several retailers

114
Q

How does a manufacturer sell in exclusive distribution?

A

Sell product through one wholesale or retailer in each market area

115
Q

What is the 2-way exclusivity?

A

Middleman cannot sell directly competing product

116
Q

What is the advantage of the exclusive distribution?

A

Manufacturer have more control over marketing

117
Q

Why will retailer or dealer be cooperative in an exclusive distribution?

A

Future tied to success of product (only one)

Aggressive promoting

118
Q

When is exclusive distribution used?

A 
Specialty products 
Strong brand preference 
Exceptionally high value 
Bought infrequently 
Significant contribution to persons life
119
Q

Because there is strong brand preference for exclusive goods, what do customers do?

A

Spend a lot of time and effort
Researching
Talking to opinion leaders or salespeople

120
Q

What are the different types of retailing?

A 
Self service retailing
Convenience stores
Discount stores
In-store full service retailer
Automatic vending
121
Q

What are the characteristics of self service retailers?

A 
Big department stores
Many product lines
Minimum customer service 
Low prices
Centralized checkouts
122
Q

What are convenience stores?

A 
Stores similar to supermarkets 
Smaller in size
Carry a limited product range
Higher prices 
Longer shopping hours
More convenient locations
123
Q

What are discount stores?

A

Sell products below listed price
Advertise widely
Offer minimum customer service

124
Q

What are in-store full-service retailers?

A

Offer wide variety of services

Add to core product

125
Q

In-store full service retailers provide services like?

A 
Information
Advice
Fitting
Filling special orders (customazation) 
Handling and delivery
Credit
126
Q

What is automatic vending?

A

Through automatic vending machines
Coin operated
Payment through prepaid cards
Mobile phones

127
Q

What kinds of products are sold in vending machines?

A 
Low in value, low mark up 
Sold higher than in stores
Well-known, familiar, trusted 
Convenience goods 
Small, uniform in size and weight
Limited amount of processing
128
Q

What are the levels of service retailers can offer?

A

Self service
Limited service
Full service

129
Q

What do customers do in self service?

A

Perform most of the functions themselves

Nonessential services are eliminated

130
Q

What is provided in limited service?

A

Essential services
Salespeople available in store
Financing and technical help

131
Q

What are customers still expected to do in limited service stores?

A

Perform most of shopping tasks

132
Q

Where do you have full-service retail stores?

A

Specialty stores

Department stores

133
Q

What do full-service stores provide?

A

Many services

134
Q

What are the general considerations for choosing the type of distribution channel?

A

How customers want to buy?

Where customers want to buy?

When do customers want to buy?

What information, advice and service do customers need to make their choice?

What storage and transportation requirements will the product require to make it from factory to the retail store

Marketing (9 decks)

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