Effective Product Distribution Strategies: Key Considerations
Key Factors in Product Distribution Strategies
Selecting the right distribution channels is crucial for product success. Several factors influence this decision, impacting sales, profitability, and market reach. Here’s a breakdown of key considerations:
Product Features
- Price: High-priced items may benefit from direct sales or exclusive distribution. Lower-priced items often require distribution through intermediaries, potentially shared with competitors.
- Seasonality: Seasonal products face reduced
Strategic Sales and Marketing: Building Customer Relationships
ABC Customer Classification
- Group A: Represents 10% of clients, 75% of sales. Your most valuable customers. They should receive special attention and treatment. Any time spent on emails, in-person meetings, or phone calls with them is well worth it.
- Group B: Represents 20% of clients, the next 15% of sales. Customers should not be ignored. With the right attention and encouragement, these items have the potential to become Group A customers.
- Group C: Represents 70% of clients, making up the last 10%
Distribution Strategies: Channels, Value, and Intermediaries
Distribution Strategy
- Distribution/Marketing Channels
- Placement or Distribution connects Production with Consumption, making products or services available to consumers.
It involves making a product or a service available for the consumer:
In the Quantity that the consumer demands
In the Moment when the consumer needs it
In the Place where the consumer wants to have it
Distribution creates three types of value:
- Time Value: Consumers can purchase the product when they need it.
- Place Value: Selling a product