Place In The Marketing Mix Flashcards
What is place?
It means where the final consumer can buy a product.
It refers to how the product is made available and distributed to customers.
Key terms for ‘place’:
PRODUCER / MANUFACTURER is the business that makes the products.
WHOLESALER is a business that buys products in large quantities from manufacturers and sells in smaller quantities to retailers.
RETAILER is a business that sells the products to the consumers.
CONSUMERS are the people or businesses that buy products for their own use.
For a RETAILER, ‘place’ means:
- the location of shops
* whether customers can buy over the phone or via the Internet.
For a MANUFACTURER, ‘place’ means:
- finding the right outlets (retailers) to sell its products
- choosing the most effective channels of distribution.
What is channel distribution?
They are the stages of ownership that take place as a product moves from the manufacturer to the consumer
The manufacturer or producer makes the product in large quantities and sells it on to another business, or directly to the consumer. The wholesaler buys from producers and manufacturers in bulk at relatively low prices. The retailer is any outlet where the consumers can buy the product
What are the advantages of manufacturers selling via retailers instead of directly to consumers?
- Your products are seen by far more potential customers
* You benefit from the advertising carried out by the retailers
Disadvantages of manufacturers selling via retailers instead of directly to consumers?
- Your selling price to the retailer will be much lower than what you could charge consumers
- Retailers may insist that the products are not sold elsewhere
What are methods of distribution?
Internet (e-commerce), door to door/telesales, mail order, vending machines.
What is E-Commerce?
It means buying or selling products online (on the Internet)
What are the benefits of E-Commerce?
- It can reach large numbers of potential customers, which can increase revenue
- It is cheaper than opening new shops (no rent and fewer employees needed)
What are the drawbacks of E-Commerce?
- Transport costs for delivering products to customers
- New businesses will need to spend money on advertising the website
- Problems with hacking and security
What is consumer protection?
CONSUMER PROTECTION means the laws and codes of conduct that exist to protect consumers when buying goods and services.
Businesses need to understand these when carrying out marketing activities
There are many laws which protect consumers from being sold, namely products that are:
• Poor quality
• Wrongly described
• Incorrectly weighed or measured
• Advertised in a misleading manner
• Sent to the buyer without being ordered
• Sold on credit with misleading information regarding interest rates, repayment dates etc.
