Individual: Distribution Channel Article Review

Distribution Channel Article Review

MKT/421

Introduction

When developing a distribution strategy for new products, it is important to take the time to research all the various strategies and methods that are available. The firm has to understand how to effectively distribute the products to the consumers in the best way possible. Because of this, marketing distribution channels, promotional strategies, and digital marketing technologies are essential concepts to understand. Having the ability to identify the targeted market will help to uncover the need for diverse distribution channels. Today I will define what a distribution channel is, while also discussing why it is important to the marketing process. I will also describe the differences between direct and indirect distribution channels, introduce the article I have selected. Lastly, I will compare and contrast similarities and differences with distribution strategies for online versus brick and mortar businesses.

Distribution Channel

According to “Investopedia” (2018), “A distribution channel is a chain of businesses or intermediaries through which a good or service passes until it reaches the end consumer”. This can include the retailers, wholesalers, distributors, and even the internet. All forms of distribution channels are a way that all goods or services must travel in order to arrive to the intended consumer. Distribution is important when it comes to global marketing. The channels of distribution are important because these are the channels used to help customers get the products they want.

Direct and Indirect Distribution Channels

When it comes to distribution channels, there are two forms, direct and indirect. Direct channels of distributions are those that allow the consumer to buy directly from the manufacturer, while indirect channels of distribution are where the consumer buys the goods from a wholesalers or retailer. Direct distribution can be done in several different ways, such as, face to face sales, catalogs, telephone calls, online marketing, and direct mail. An advantage to direct distribution would be web based selling, as it has low overhead and gives your product the potential to be reached globally. The main disadvantage to direct distribution “is that a direct distribution channel cannot compete with the geographical reach and business volume of a distribution channel that includes major wholesalers and retailers” (Forest Time, 2018). Indirect channels of distribution are channels that rely on intermediaries to perform the distribution functions, also known as wholesale distribution. An advantage to indirect distribution channels is that there are no startup costs and it can be a lot simpler to manage compared to direct distribution channels. Ross (2018), “The most challenging part of indirect distribution channels is that another party has to be entrusted with the manufacturer’s products and customer interactions”.

Article, Authors, and Brief Summary

The article I am using today is Female Shoppers’ Outlook of Firms’ Fairness in Marketing Communications and Distribution Channels and the authors of this article are Pranav Kumar and Sany Sanuri Mohd Mokhtar. This article is about a survey being conducted to determine how marketing practices, such as distribution bias and improper or unfair advertising, influence the attitudes of the consumers, specifically women. With this study, we were able to see that marketing managers are advised to take measures to ensure that promotions and advertising are fair and without prejudice. There are many consumers that purchase items from certain stores based on the firm’s specific ethics. There are studies that show when a firm follows ethical practices in marketing, end up with boosted sales of their products because the customers are more willing and happy to purchase from them. There are also reports showing how advertisements that have offensive elements have a negative impact on the attitude of the consumers about the firm (Kumar & Mokhtar, 2017). With this study, we are able to determine that firms need to strictly follow fairness and ethics when it comes to designing the marketing communications and any promotional activities. Lastly, it is recommended that firms offer products that are safe, while also revealing all of the required information regarding both costs and benefits, to better assist the shoppers with appropriate buying decisions (Kumar & Mokhtar, 2017).

The Relationship Distribution Channels have to Maintaining a Satisfied Target Market

Commitment and accountability are important when it comes to building a trusting and reliable relationship between distribution channels and their customers. Both manufacturers and companies count on each other and leave their reputations to be determined by the customers, who look at the accuracy of the company. Distribution channels are a significant part of the relationship between both the vendor and the customer.

Compare and Contrast Similarities and Differences in Distribution Strategies for Online versus Brick and Mortar Businesses

When it comes to distribution strategies, it is an important aspect for both online and brick and mortar businesses. Both online and brick and mortar businesses are trying to reach the most potential customers by using advertising and customer service. Online businesses have an advantage in the way that they have lower operating costs in comparison to brick and mortar businesses. Online businesses also provide more flexibility for the consumer compared to brick and mortar. On the other hand, brick and mortar businesses provide instant gratification for the consumers. Another benefit that brick and mortar businesses have is that consumers usually have more confidence in purchasing a product when they are able to see and touch the products. One company that is very successful and is online only is Amazon. They offer all different products and have even been growing their products and services to include groceries, alcohol, and also same day delivery of goods. Though they are not brick and mortar, they thrive to exceed customer expectations and stand behind the products they sell.

Conclusion

In conclusion, we can see how important distribution channels are to the success of a business. You must take the time to research the various strategies and methods to ensure you are choosing the best fit for that product, the consumer, and the company. If there are any issues with a product or service, it would be beneficial to look at the distribution channel and make any changes or adjustments. Depending on the company, there may be direct or indirect distribution channels used and they can both be useful distribution channels depending on the needs of the company.

References:

Investopedia (2018). Retrieved from https://www.investopedia.com/terms/d/distribution-channel.asp 

 Forest Time. (2018). What is a Direct Channel of Distribution?. Retrieved from https://smallbusiness.chron.com/direct-channel-distribution-42213.html 

Ross, S. (2018). Investopedia. Retrieved from https://www.investopedia.com/ask/answers/052115/what-difference-between-direct-and-indirect-distribution-channel.asp 

Kumar, P., & Mokhtar, S. (2017, Summer). Female Shoppers’ Outlook of Firms’ Fairness in Marketing Communications and Distribution Channels. Management & Marketing, XV(1), . Retrieved from https://doaj.org/article/6a88d0ec78754db191b7672463ea1bf8