What is selective distribution?
Selective distribution is a retail strategy that involves making a product or group of products available only in certain markets. This is the opposite of open distribution, where a product line is distributed to as many markets as possible.
What are the advantages of selective distribution?
Benefits of Selective Distribution
- Protection of Brand Image For many goods, especially in the luxury industry, the right brand image is vital for enhancing the demand for the product. ...
- Protection from free-riding opportunism Freeriding occurs when one market actor takes advantage of the investment and inputs from another market actor. ...
- Protection from manufacturer opportunism
What is a distribution strategy in marketing?
What is a distribution strategy?
- Product type. Depending on the type of product or service you offer, your distribution strategy may vary. ...
- Customer base. Another factor to consider is your user, or customer, base. ...
- Warehouse and transportation logistics. ...
What are some examples of distribution channels in marketing?
- Targeting Blogs
- Publicity
- Unconventional PR
- Search Engine Marketing
- Social and Display Ads
- Offline Ads
- Search Engine Optimization
- Content Marketing
- Email Marketing
- Viral Marketing
What is selective distribution example?
Selective Distribution Example The best examples would be of Whirlpool and General Electric who sell their major appliances through dealer networks and selected large retailers. They develop a good working relationship with these selected channel partners and expect a better-than-average selling effort.
What are the 3 types of distribution in marketing?
The three types of distribution channels are wholesalers, retailers, and direct-to-consumer sales. Wholesalers are intermediary businesses that purchase bulk quantities of product from a manufacturer and then resell them to either retailers or—on some occasions—to the end consumers themselves.
Why should I use selective distribution?
Selective distribution allows to differentiate between luxury products and potentially competing – albeit more “common” – products. It mainly allows to manage scarcity and prestige, which constitute two of the essential characteristics of luxury products.
What is distribution selection?
A selection distribution strategy allows companies to select appropriate outlets according to different locations. Additionally, it's highly beneficial for manufacturers since they're able to choose price points based on their consumers.
What are the 4 types of distribution?
There are four types of distribution channels that exist: direct selling, selling through intermediaries, dual distribution, and reverse logistics channels. Each of these channels consist of institutions whose goal is to manage the transaction and physical exchange of products.
What are the 4 types of distribution strategies?
What Are the Different Types of Distribution Strategies? As mentioned above, the two main types of distribution strategies are direct and indirect. There are also more nuanced types of distribution that fall into these categories — intensive, selective and exclusive distribution.
Does Nike use selective distribution?
Besides the three channels, Nike also uses the selective distribution to channel its products. Based on the selective distribution, the company can be found in many places that match the needs of their targeted customers.
Which products are best suited for a selective distribution strategy?
A good example for products for which selective distribution is used is cars. This need not be the case for high end luxury cars, for which, more often than not, exclusive distribution is used. For the low-end range and mid-level range cars, selective distribution is used.
What is a selective strategy?
Last updated: Mar 24, 2022 • 3 min read. Selective distribution is a marketing strategy focusing on selling certain types of products via a select network of retailers, resellers, or wholesalers. Distributors take this approach as a middle road between intensive and exclusive forms of distribution.
What is selective distribution quizlet?
Selective distribution is defined as selling through a limited number of qualified retailers. Selective distribution requires companies take an active role in vetting and deciding on appropriate retailers. Selective distribution, in general, supports higher prices than does intensive distribution.
What are the 3 main distribution strategies?
There are three methods of distribution that outline how manufacturers choose how they want their goods to be dispersed in the market.Intensive Distribution: As many outlets as possible. ... Selective Distribution: Select outlets in specific locations. ... Exclusive Distribution: Limited outlets.
What are the benefits of selective distribution quizlet?
Selective distribution, in general, supports higher prices than does intensive distribution. - selling through only a few retailers. The retailer has the exclusive right to distribute the product in their geographic area.
What are the 5 major types of distribution channels?
The 5 channels of distribution include the categories of the channel based on their levels. This includes both the direct and the indirect channels of distribution. The 5 channels include the zero-level channel, one-level channel, two-level channel, three-level channel, and four-level channel of distribution.
What are the 6 main distribution channels?
The Nine Main Intermediaries in Distribution ChannelsRetailers. Retailers are intermediaries used frequently by companies. ... Wholesalers. Wholesalers are intermediaries that buy and resell products to retailers. ... Distributors. ... Agents. ... Brokers. ... The Internet. ... Sales Teams. ... Resellers.More items...
What are the types of distributors?
There are 3 main types of distributors which are intensive distributors, selective distributors and exclusive distributors. The types of distributor can also be classified as direct distributors and indirect distributors.
What are the 4 steps in the distribution process?
Producer-wholesaler-retailer-customer – This is regarded as the traditional stage of product distribution which flows from producer to wholesaler to distributor to retailer before finally reaching the consumer.
Selective Distribution - Explained
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What is Selective Distribution?
Selective distribution is considered to be a medium level of product availability that seeks to balance product availability with inventory and storage costs.
What is selective distribution?
Selective distribution is a type of channel distribution where a company or a brand chooses a certain set of outlets through which they can further make their products available to the consumers.
Why is distribution important in marketing?
Distribution plays a major role in one’s marketing strategy, and this is more so because unless and until your distribution is top-notch, the product won’t reach your desired consumers.
Is selective distribution a luxury car?
While exclusive distribution may happen for a very high-end brand range car, selective distribution is more so in the case of premium or mid-range but not luxury cars.
What is exclusive distribution?
Exclusive distribution as the name suggests is the model where in a particular locality a company has just one dealer or retailer. This makes the brand more exclusive and gives the dealer exclusive rights for the sale of the product in that particular vicinity. This dealer also deals only in one particular brand and does not sell brands of competitors. Maruti has recently launched its ‘Nexa’ showroom that is for its slightly higher end cars. This is an example of exclusive distribution model.
Why is Raymond so selectively distributed?
But if you talk about Raymond, then Raymond has selective distribution because besides selling in its own exclusive outlets, Raymond is sold via franchise’s as well as in other other multi brand outlets. Watches of Titan are also selectively distributed because besides being sold in “World of Titan” they are also sold in selected outlets.
What are the three types of distribution channels?
There are three common types of distribution channels adopted by companies: Intensive Distribution, Selective Distribution and Exclusive distribution
Why do brands advertise with select outlets only?
However, they are also available in other outlets which are famous for their turnover and the number of customers they serve. Hence, when these brands advertise, then use the words “Select outlets only”. This is done to show that the brand is using selective distribution. It also adds to the premium feel of the brand.
Why is intensive distribution important?
This is done especially for products where more availability leads to more sales. Example, cigarettes. Another reason for doing this is because some products are such that if one brand of it is not available, the consumer will simple choose another brand. This induces competition and hence a company uses all outlets possible to make its products available to the customers.
What happens if a retailer does not stock multiple brands?
If the retailer agrees not to stock multiple competing brands or to limit the number of competing brands, this can reduce the competition within the store which is good for the brand.
Why do companies use all outlets possible?
Another reason for doing this is because some products are such that if one brand of it is not available, the consumer will simple choose another brand. This induces competition and hence a company uses all outlets possible to make its products available to the customers.
What is selective distribution?
Selective distribution is the most effective distribution strategy for high-end brands that want to set up a limited number of outlets in a particular geographical location. This is quite different from exclusive distribution (which can be a little too extreme) and is considered as a middle path approach to distribution.
Why do Companies opt for selection distribution strategies?
A selection distribution strategy allows companies to select appropriate outlets according to different locations.
Why do luxury goods need selective distribution?
Since this form of distribution caters to the needs of consumers of a specific geographical area, its best suited for companies that want to maintain quality. This is why it’s no surprise that luxury goods manufacturers often opt for selective distribution.
Why are distributors handpicked?
This reduces the risk of fumbles, leading to increased consumer satisfaction.
What should companies conduct for maximum results?
For maximum results, companies should conduct a detailed market research. This’ll help determine what kind of distribution strategy would be best suited for their products.
Can selection distribution increase market penetration?
Since products sold via selection distribution aren’t available everywhere, you may not be able to achieve increased market penetration. But of course, that depends on the goals of the organization.
What is Selective Distribution?
Selective Distribution is a type of distribution strategy that lies and operates between intensive and exclusive distribution. Selective Distribution involves using more than one, but lesser than all the intermediaries and distributors who carry the company’s products on a basis of a company specific set of rules.
Selective Distribution Example
The best examples would be of Whirlpool and General Electric who sell their major appliances through dealer networks and selected large retailers. They develop a good working relationship with these selected channel partners and expect a better-than-average selling effort.
What are the different types of distribution?
Types of Distribution: Intensive, Selective and Exclusive Distribution. Article shared by : ADVERTISEMENTS: Some of the important types of distribution in international market are 1. Intensive 2. Selective and 3. Exclusive distribution. It represents the level of international availability selected for a particular product by the marketer;
What are some examples of exclusive distribution rights?
Typical examples are of designer ware, major domestic appliances and even automobiles. By granting exclusive distribution rights, the manufacturer hopes to have control over the intermediaries price, promotion, credit inventory and service policies. The firm also hopes to get the benefit of aggressive selling by such outlets.
What is intensive distribution?
Intensive distribution is usually required where customers have a range of acceptable brands to choose from. In other words, if one brand is not available, a customer will simply choose another.
When a firm distributes its brand through just one or two major outlets in the market, who exclusively deal in it?
When the firm distributes its brand through just one or two major outlets in the market, who exclusively deal in it and not all competing brands, it is said that the firm is using an exclusive distribution strategy . This is a common form of distribution in products and brands that seek a high prestigious image.
What does intensity mean in marketing?
It represents the level of international availability selected for a particular product by the marketer; the level of intensity chosen will depend upon factor such as the production capacity, the size of the target market, pricing and promotion policies and the amount of product service required by the end-user.
What Is Selective Distribution?
Why Do Companies Opt For Selection Distribution Strategies?
- A selection distribution strategy allows companies to select appropriate outlets according to different locations. Additionally, it’s highly beneficial for manufacturers since they’re able to choose price points based on their consumers. This eventually leads to a more personalized shopping experiencethat encourages consumers to come back again and again.
Selection Distribution Examples
- Since this form of distribution caters to the needs of consumers of a specific geographical area, its best suited for companies that want to maintain quality. This is why it’s no surprise that luxury goods manufacturers often opt for selective distribution. High-end companies that produce exceptional quality clothing and accessories are likely to use selective distribution. For example…
Selective Distribution Advantages and Disadvantages
- Depending on the organization and its goals, selective distribution offers its own set of advantages and disadvantages.
Disadvantages of Selective Distribution
- On the flip side, here are a couple of disadvantages that are associated with selective distribution: