Marketing Mix: Place Flashcards
What is Place Mix?
Place is the decision on how products should pass from manufacturer to the final customer.
What is a distribution concept?
Getting the right product to the right consumer at the right time in a way that is most convenient to consumers.
What is Channel of Distribution?
The chain of intermediaries a product passes through from producer to final consumer.
What is Zero-Channel Network?
Direct Selling
Producer -> Consumer
Example of Zero-Channel Network. (3)
Mail, Airline ticket, Hotel
Advantage of Zero-Channel Network.
Complete Control, Faster, Direct Contact with customer.
Disadvantage of Zero-Channel Network.
Not applicable to all products
Impractical if consumer doesn’t live near the factory.
What is One-Channel Network?
Producer -> Retailer -> Consumer
Most Commonly used
Example of One-Channel Network.
Large Supermarket, Convenience Store, Discount Store
Advantage of One-Channel Network.
Product display, convenient access, producer focuses on production.
Disadvantage of One-Channel Network.
Cost taken by retailer, no exclusive outlet (retailer sell competitor’s product), delivery cost to retailer.
What is Two-Channel Network?
Producer -> Wholesaler -> Retailer -> Consumer
Two-Channel Network involved a wholesaler who is able to perform _______.
Breaking Bulk
What is Breaking Bulk?
Wholesalers buy products from manufacturer in large quantities and then divide the stock into smaller quantities for retailers to buy.
Advantage of Two-Channel Network.
Best way to enter foreign market as producer has no contact with retailers.
Disadvantage of Two-Channel Network
Slows down distribution chain, takes a mark up profit.
What is Three-Channel Network?
Producer -> Agent -> Wholesaler -> Retailer -> Consumer
What is Retailer?
Provides convenient location for consumer to buy goods or service.
Sells products at a higher price.
What is Wholesaler?
Buys from producer in bulks, getting big discount.
Has huge warehouse and distribution network like truck, planes, ship. Consumer usually don’t buy from wholesaler.
What is an agent?
Independent person or business that deals with the sales and distribution of a product in an unknown market.
Disadvantage of getting an agent.
Will add price to cover in business expenses.
