Matakuliah
Tahun
: J0712 - Pengantar Bisnis
: 2009
Product Distribution and Promotion
Pertemuan 11
Product Distribution and Promotion
•Outline:
–Distributional mix and its channels: wholesale and retail
–Promotional mix:
–Advertising
–Personal selling
–Sales promotion
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Distribution Mix
• The combination of distribution channels by which a
seller gets its product to end users
Distribution channel is: network of
interdependent companies through
which a product passes from
producer to end user
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Intermediaries
• Wholesaler-sells
products to retailers
for re-sale
Channels
• Distribution- Network through
which product passes on its
way to the end user
• Direct
• Retailer- sells products
directly to consumer
– No intermediaries
– Producer uses own sales
force
– Used by many internet
companies
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Channels of Distribution
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Channels of Distribution
• Channel 1: Direct Distribution of Consumer Products
– Direct channel occurs when the product travels from
producer to consumer without intermediaries
• Channel 2: Retail Distribution of Consumer Products
• Channel 3: Wholesale Distribution of Consumer
Products
• Channel 4: Distribution through Sales Agents or
Brokers
– Sales agents (or Brokers) represent producers and
sell to wholesalers, retailers or both
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Channels of Distribution
• Channel 5: Distribution by Agents to Consumers and
Businesses
- An agent functions as the sole intermediary.
- The agent distributes to both consumers and business customers
• Channel 6: Direct Distribution of Business Products
– Sales offices are maintained by manufacturers as contact points
with customers
• Channel 7: Wholesale Distribution of Industrial
Products
• Channel 8: Wholesale Distribution to Business
Retailers
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Distribution Strategies
Intensive
Selective
Exclusive
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Agents/Brokers
• Independent representatives
• Work on commission
• Do not take ownership or possession
• Have extensive knowledge of market
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E-Intermediary
• E-intermediaries are Internet-based channel
members who perform one or both of two
functions:
– Collect information about sellers for consumers
– Deliver internet products to buyers
• Types of e- intermediaries:
– Syndicated Sellers Web sites that offer another
a commission for referring customers.
– Shopping Agents (e-agents) help Internet
consumers by gathering and sorting information.
– Business-to-business brokers enable
businesses to buy and sell from one another and
confirm transactions electronically.
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Types of Retail Outlets
• Product line retailers feature broad product
lines
• Bargain retailers carry wide ranges of products
and come in many forms
• Nonstore and electronic retailing involves
selling all or most of a retailer’s products without
brick-and-mortar stores
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Product Line Retailers
• Department stores are organized
into specialized departments
• Supermarkets are divided into
departments of related products
• Specialty stores are small stores
that carry one line of related
products
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MACY*S
Kroger
Gap
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Bargain Retailers
• Discount houses generate large sales volume by offering goods at
substantial price reductions
• Catalog showrooms mail catalogs to attract customers into
showrooms to view display samples and place orders to be picked up
at on-premises warehouses
• Factory outlets are owned by the manufacturer whose products it sells
• Warehouse club (or Wholesale club) offers large discounts on brandname merchandise to customers who pay annual membership fees
• Convenience stores offer easy accessibility, extended hours and fast
service
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Nonstore and Electronic Retailing
• Direct-response retailing involves direct interaction
with customers to inform them about products and to
receive sales orders
– Mail order (or Catalog marketing) involves the customer placing
orders for catalog merchandise received through the mail
– Telemarketing is the use of the telephone to sell directly
– Direct selling is selling door-to-door or through home-selling
parties
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Electronic Retailing
• Nonstore retailing in
which information about
the seller’s products
and services is
connected to
consumers’ computers,
allowing consumers to
receive the information
and purchase the
products in the home
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• Forms of electronic
retailing:
– Internet-Based Stores
– Electronic Catalogs (or Ecatalogs)
– Electronic Storefronts and
Cybermalls
– From Door-to-Door to ESales?
• Multilevel Marketing
– Interactive and Video
Marketing
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Transportation Operations
• Factors in choosing
transportation methods:
– Cost
– Nature of the product
– Customer wants and
needs
– Distance
– Speed
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• Major transportation modes:
–
–
–
–
–
Trucks
Railroads
Planes
Water carriers
Pipelines
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What is Promotion?
• Promotion is part of
marketing mix concerned with
most effective techniques for
selling product.
• Information and exchange
values:
– Notify potential customers
– Educate potential customers
– Persuade customers to like
product
– Persuade customers to buy
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Promotional Objectives:
• Communicate information
• Position products
• Add value
• Control sales volume
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Promotional Strategies
• Pull strategy appeals directly to consumers who will
demand the product form retailers
• Push strategy encourages wholesalers or retailers
to market products to consumers
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The Promotional Mix
Four types of promotional tools:
– Advertising
– Personal Selling
– Sales Promotions
– Publicity and
Public Relations
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What is Advertising?
• Advertising is a
promotional tool
consisting of paid,
nonpersonal
communication used by
an identified sponsor to
inform an audience about
a product
• Advertising Strategies:
– Persuasive advertising
seeks to influence consumers
to buy a company’s products
rather than its rivals’  stress
quality
– Comparative advertising
directly compares two or more
products  maturity stage
– Reminder advertising helps
to keep the product name in
the consumer’s mind 
decline stage
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Advertising Media
• Variety of communication
devices for carrying a seller’s
message to potential
customers
•
•
•
•
•
•
•
•
•
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Television
Newspapers
Direct Mail
Radio
Magazines
Outdoor Advertising
Internet Advertising
– Data Mining and Date
Warehousing for Internet
Advertising
Virtual Advertising
Other Advertising Channels
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What Is Personal Selling?
• Promotional tool in
which a salesperson
communicates oneon-one with potential
customers
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• Use of telephone
solicitations to
conduct the personal
selling process
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What Is a Sales Promotion?
• Short-term promotional
activity designed to
stimulate consumer buying
or cooperation from
distributors, sales agents
or other members of the
trade.
COUPON
1
$
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00
OFF
Any
Brewed
Coffee
• Types of sales
promotions:
– Coupons are certificates entitling
bearers to savings off regular prices
– Point-of-Purchase (POP) displays
are used to grab customers’ attention
as they move through stores
– Premiums are gifts given to
consumers in return for buying a
specified product
– Trade shows are sponsored by
industries for members and
customers
– Contests are used to induce sales
among customers, distributors and
sales representatives
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Publicity and Public Relations
• Publicity is a promotional tool
in which information about a
company or product that is
transmitted by general mass
media
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• Public relation is companyinfluenced publicity directed at
building goodwill with the
public or dealing with
unfavorable events
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Small Business
Advertising
• Internet
• Non-Prime Time
• Yellow Pages
Small Business
Personal Selling
• Sales Force
• Sales Agencies
• Direct Mail
• Targeted Magazine Ads
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• Telemarketing
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International Promotional Strategies
• Emergence of the Global Perspective
– Global perspective is a philosophy that directs marketing toward a
worldwide rather than local or regional markets
• The Movement toward Global Advertising
– Four factors to consider:
• Product Variations
• Language Differences
– Cultural Receptiveness
– Image Differences
• Universal Messages and Regional Advertising Skills
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