Distributionsstrategi

Question 1

Beskriv intermediaries

Answer 1

• Channel member: a layer of intermediaries that performs some work in bringing the product and its ownership closer to the final buyer
o Resell the product into a market that could not be reached as efficiently or effectively by the original seller
• Intermediaries have already established trust with their customers

Question 2

Hvad er en leverandør portfolie analyse?

Answer 2

• This analysis can be undertaken by reviewing the information on a distributors growth rate and firm’s percentage of distributors total sales

Question 3

Beskriv forholdet mellem leverandør og distributør

Answer 3

• Relationship occurs when there is a fit between marketing strategies and implementation skills of manufacturer and distributor
• Customer value created with what each party brings to the table  how they work together to add additional customer services and marketing campaigns
• Unique trading relationship advantage can come from both the manufacturer and distributor working together to reduce the costs of doing business
• Agent: a marketing intermediary who does not take title to the products but develops a marketing strategy and establishes contacts abroad
• Larger firms operated under sales representative/purchasing model
o Model assumes that firms trading relationship is funneled primarily through single agents: personal relationship between the selling firms salesperson (agent) and the buying firms purchasing manager (agent)
• Personal trust and commitment
o Personal trust: when what the individual representatives say, is their bond and are prepared to help each other solve problems
o Commitment: commitment to the goal of developing and nurturing the competitiveness of the relationship, compared to other competitive trading relationships

Question 4

Beskriv de interne og eksterne faktorer når man vælger distributionskanaler

Answer 4

Customer characteristics
• Customer or final consumer, is keystone in any channel design
• Size, geographic distribution, shopping habits, outlet preferences and usage patterns of customer groups must be taken into account when making distribution decisions

Nature of the product
• Product characteristics play a key role in determining distribution strategy
• Low prices, high-turnover convenience products  requirement is an intensive distribution network
• Not necessary for a prestigious product to have a wide distribution
• Transportation and warehousing costs are also critical issues

Nature of demand/location
• Perceptions that target customers hold about particular products can force modification of distribution channels
• Product perceptions are influenced by the customer’s income and product experience

Competition
• Channels used by competing products and close substitutes are important because channel arrangements that seek to serve the same market, often compete with one another
• Consumers generally expect to find particular products in particular outlets or have become accustomed to buying particular products in particular stored

Legal regulations/local business practices
• Country may have specific laws that rule out use of particular channels or intermediaries

Question 5

Market coverage

Answer 5

• The amount of market coverage that a channel member provides is important
o Can refer to geographical coverage or number of retail outlets  broad term
• Intensive coverage: calls for distributing the product through the largest number of different types of intermediary and the largest number of individual intermediaries of each type.
• Selective coverage: entails choosing a number of intermediaries for each area to be penetrated.
• Exclusive coverage: involves choosing only one intermediary in a market.

Question 6

Channel length

Answer 6

• Determined by the number of levels or different types of intermediary
• Longer channels (several intermediaries)  associated with convenience goods and mass distribution

Question 7

Kontrol

Answer 7

• Control of one member in the vertical distribution channel means its ability to influence the decisions and actions of other channel members
• Channel control is of critical concern to international marketers wanting to establish international brands
• An intermediary typically performs certain functions:
o Carrying of inventory
o Demand generation or selling
o Physical distribution
o After-sales service
o Extending credit to customers

Question 8

Channel integration

Answer 8

1. Vertical integration: seeking control of channel members at different levels of the channel
2. Horizontal integration: seeking control of channel members at the same level of the channel (competitors)

Question 9

Multiple channel strategy

Answer 9

• Employed when firm makes a product available to the market through two or more channels of distribution  internet, salesforce, call centers, retail stores and direct mail
• Very popular channel design during last decade
• Increasing popularity results from potential advantages provided: extended market coverage and increased sales volume

Question 10

Omnichannel strategy

Answer 10

• All the channels are available to the customer, and the channels are also integrated and connected. The purpose is to deliver experiences and value through the whole customer journey
• May be difficult for companies to shift from multi-channel to omnichannel because of difference in marketing strategies supporting the channel structure:
o Organizational barriers (silos) for traditional marketing campaigns requires reorganization and change in processes between several departments
o Integrating and omnichannel distribution system requires and integrated e-business system within the organization.

Question 11

Typer af distribution/market coverage

Answer 11

Intensiv, selektiv, og eksklusiv

Question 12

Disintermediation og reintermediation

Answer 12

Disintermediation: Elimination of a layer of intermediaries from a marketing channel or the displacements of traditional resellers by radically new types of intermediaries

Reintermediation: Brugen af internettet som sendebudet med information fra fabrikant til kunden

Question 13

Direkte og indirekte kanaler

Answer 13

Direct channel  firms that sell their own products through catalogues using freephone numbers and through factory outlet shops use direct channels (one producer and one customer)

Indirect channel  include one or more channel intermediaries – firms or individuals such as wholesalers, agents, brokers and retailers who in some way help move the product to the consumer or business user

Question 14

Hvorfor kan distributionskanaler være brugbare?

Answer 14

• Distribution channels create efficiencies by reducing the number of transition necessary for goods to flow from many different manufacturers to large numbers of customers:
o 1. Breaking bulk: Wholesalers and retailers purchase large quantities of goods from manufacturer but sell only one or few at a time to many different customers
o 2. Assortment: Providing a variety of products in one location so that customers can conveniently buy many different items from one seller at one time
o One of the functions of distribution channels is to provide an assortment of products

Question 15

Typer af wholesalers

Answer 15

• Wholesaling intermediaries
o Firms that handle the flow of products from the manufacturer to the retailer or business user
• Independent intermediaries
o Companies that do business with many different manufacturers and customers
 Full-service merchant wholesalers provide a wide range of services for their customers
 Limited-service merchant wholesalers provide fewer services for their customers (495)
• Cash-and-carry wholesalers
• Mail-order wholesalers

Question 16

Typer af distributionskanaler

Answer 16

Consumer channels
• Direct channel may allow the producer to serve its customer better and at a lower price than tis possible through a retailer
• Producer-retailer-consumer channel portrays the shortest indirect channel
• The producer-wholesaler-retailer-consumer channel is a common distribution channel in consumer marketing (498)

Business-to-business channels
• Business-to-business channels parallel consumer channels in that they may be direct or indirect
Multi-channel systems
• When the manufacturer sells to multiple different distribution channels. E.g. medicine to hospitals, pharmacists, clinics
•
Hybrid-marketing systems
When the manufacturer sells both directly to the consumer but also through retailers/distribution channels. Also uses different forms of communication
• Increased coverage of the market
• Lower marketing costs
• Greater potential for customization of service for local markets

Question 17

Beskriv trinnene i en strategi for distributionskanaler

Answer 17

Step 1; Develop distribution objective

Step 2; Evaluate internal and external environmental influences

Step 3; choose a distribution strategy
Conventional, vertical or horizontal marketing system?
• Conventional system
o multi-level distribution channel in which members work independently of one another
o Their relationship is limited to simply buying and selling from one another
• Vertical marketing system
o channel in which there is a formal cooperation among channel members at two or more different levels: manufacturing, wholesaling and retailing
o Reducing cost incurred in channel activities
o Three types of vertical marketing systems:
 1. Administered VMS
 2. Corporate VMS
 3. Contractual VMS
• Horizontal marketing system
o Two or more firms at the same channel level agree to work together to get their product to the customer

Intensive, exclusive or selective distribution?

Step 4; Develop distribution tactics

• Selecting channel partners
• Managing the channel
• Develop logistics strategies

Question 18

Hvordan klassificeres detailhandler?

Answer 18

Classifying retailers by what they sell
One of the most important strategic decisions a retailer makes is what to sell  merchandise mix

Classifying retailers by level of service
Retailers differ in the amount of service they provide for consumers
• Falling in between self-service and full-service retailers are limited-service retailers

Classifying retailers by merchandise selection
Classify retailers in terms of the selection they offer
• Merchandise breadth
o The number of different product lines available
• Merchandise depth
o The variety of choices available for each specific product

• Convenience stores  limited number of frequently purchased items (516)
• Supermarkets  a wide selection
• Speciality shops  relatively narrow and deep stocks of goods
• Department stores  broad range of items and offer a deep selection
• Hypermarkets  Warehouse shops and supermarkets

Question 19

Fordele og ulemper ved e-commerce (B2C)

Answer 19

Benefits of B2C E-commerce
• Consumers can choose from hundreds of thousands of sellers worldwide while marketers can tap into consumer and business markets with virtually no geographic limitations
• Online shopping provides an additional benefit by fulfilling their experiential needs that is their need to shop for fun

Limitations of B2C E-commerce
• Customers still must wait a few days to receive most products
• People need touch and feel information before buying many products
• Traditional bricks-and-mortar companies are actually more likely to be successful in cyberspace than Internet-only start-ups because they already have established brand names and a base of loyal customers
• Developing countries would primarily cash economies pose yet another obstacle to the success of B2C E Commerce

Question 20

Shop positionering

Answer 20

Shop image
Shop image is how the target market perceive the shop

Shop design; Setting the stage
The elements of ship design should correspond to management’s desired image
• Shop layout; this is the arrangement of merchandise in the shop - determines traffic flow
• Fixture type and merchandise density - or feelings about shops are affected by furnishing, fixtures and even how much stuff is packed into the sales area
• The Sound of Music
• Colour and lightning

Shop personnel
Each employee has a part to play complete with props and costumes

Pricing policy: how much for a ticket to the show
When consumers form an image of a shop in their minds the price points or price ranges of its merchandise often play a role

Building the theatre: shop location
Types of shop location
• Business districts: a central business district is the traditional business area found in a town or city centre
• Shopping centres: a group of commercial establishments owned and managed as a single property
• Free standing retailers: e.g. Ikea (525)
• Non-traditional shop locations: e.g. carts, kiosks

Site selection; Choosing words to build
The choice of where to open a new shop should reflect the company’s overall growth strategy
• They want to find a place that is convenient to customers in the shops trade area
o Trade area  geographic zone that accounts for the majority of its sales and customers
• Planners also consider such population characteristics as age profile and demographic characteristics as well as mobility
o Mobility  how often people are moving in and out of the area