Distribution Channel and Distribution Strategies

Question

Define the term Distribution Channel and what are the types of Distribution Strategies?

Answer 1

A marketing channel comprises one or more marketing intermediaries who perform a variety of functions. Each channel member:-

• Provides value;
• Performs a function; and,
• Expects an economic return.

Types of Distribution Strategies:

• Exclusive distribution: is the distribution strategy in which the distribution is limited to one intermediary in the territory.

E.g. LEICA officially appointed Jebsen & Jebsen Marketing as the exclusive distributor for Singapore, Malaysia, Indonesia, Thailand, and Brunei.

• Intensive distribution: in this distribution strategy, distribution is done from as many as outlets as possible to provide location convenience.

E.g. L&T regularly gives its ad in the newspaper

• Selective distribution: in this strategy several retailers are appointed for distribution. All the retailers of that location shall not be appointed.

E.g. Daewoo have 2 distributors in Singapore, “Starsauto, portion of a larger Indonesian group, symbolize Daewoo’s traditional line of sedans. Second is Homegrown family-owned JTA Motors markets Daewoo’s off road vehicles like Musso and Korando, and an up market model called the Chairman.