Distribution channels and the marketing mix in retail strategy

¶ … Purchasing

Whenever one purchases a particular product or service, the purchase experience depends on several variables, such as the nature of the item bought or the nature of the distribution channel used by the vendor. A growingly popular distribution channel is constituted by the virtual community, through which companies sell their items on websites. This experience is impersonal and highly technological. The completion of the purchase process depends on the technical skills of the user. Yet, it does reveal the advantage of removing geographical and time barriers, as well as avoiding crowdedness (Groshan, 2006). These advantages are not common within the physical retail stores of neither manufacturer nor vendor. The major difference between these two channels is that of the retail price being lower in the manufacturer's store and higher in the intermediary's store. Additionally, the manufacturer's store would often be located in less easily accessible areas. Finally, when purchasing from a catalog, the experience is less personal as no human interaction occurs. Additionally, like the website, the catalog does not offer the customer the ability to observe the product, but it does offer the advantages of reduced barriers and crowdedness.

Discussion Question 2: The Channel Strategy in the Marketing Mix

The marketing mix is composed from the four Ps of marketing -- product, price, promotions and place, with place being understood as distribution. In terms of products, the strategic elements of decision include the branding of the product, packaging, product styling and functionality, warranties, complementary services and so on. The price decisions include elements such as the pricing strategy to be implemented, the usage of seasonal pricing or of discount pricing, the flexibility of the price or the product's retail; price. The promotion decisions traditionally include strategic elements such as the media channels onto which the product or service would be promoted, the actual advertising campaign and its particularities so that it attracts the targeted segment, the development of the marketing budgets, the relations with the public and so on. At a more comprehensive level, the distribution strategies include:

"Distribution channels

Market coverage (inclusive, selective, or exclusive distribution)

Specific channel members

Inventory management

Warehousing

Distribution centers

Order processing

Transportation

Reverse logistics" (Net MBA, 2007).

Discussion Question 4: Cardon Carpet Mills

Based on the particularities of the Cardon Carpet Mills and the industry in which it operates, the recommendation would be that of implementing a direct distribution strategy through which they would directly interact with the customers. Also, the customer satisfaction would increase due to the fact that direct distribution is more convenient for them (Tapp, 2005). At this stage, the flooring industry is highly dynamic and competitive and the implementation of the direct distribution strategy would allow it to strengthen its competitive position.

Some advantages Cardon Carpet Mills would generate from this strategic movement would include the increased ability to more easily and effectively retrieve constructive feedback from the customers, or the ability to cash in all the sales revenues, without having to share them with the vendors. These advantages would be created with the elimination of the tertiary party existent between the company and its customers and they imply that Cardon Carpet Mills would no longer be operating under the pressures of the wholesalers. Consequently, the financial and otherwise benefits retrieved from this movement would generate more resources to be used in the achievement of the organizational goals, such as a better consolidated competitive position or the registration of increased financial results.

References:

Groshan, F., 2006, the Many Advantages and Benefits of Online Shopping, Enzine Articles, http://ezinearticles.com/?the-Many-Advantages-and-Benefits-of-Online-Shopping&id=337891 last accessed on May 21, 2010

Tapp, a., 2005, Principles of Direct and Database Marketing, 3rd edition, Pearson Education

2007, the Marketing Mix, NET MBA, http://www.netmba.com/marketing/mix / last accessed on May 21, 2010

Distribution -- Selling Direct, Tutor2U, http://tutor2u.net/business/marketing/distribution_direct.asp last accessed on May 21, 2010