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Chapter 15 Distribution

Chapter 15 Distribution. -4 bananas. 1. Physical access. 2. Alternative distribution channels. 3. Demographics & Distribution. 4. Mail options. 5. Quality addressing. 6. Barcode. 7. Outsourcing to skilled operators. 8. Electronic Distribution.

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Chapter 15 Distribution

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  1. Chapter 15 Distribution -4 bananas

  2. 1. Physical access 2. Alternative distribution channels 3. Demographics & Distribution 4. Mail options 5. Quality addressing 6. Barcode 7. Outsourcing to skilled operators 8. Electronic Distribution Table of Contents

  3. Physical access Physical Access to Chosen Markets Essential to have physical access

  4. Essential to have physical access Why accessibility to the target market is important? • Physical access to chosen markets is absolutely essential if marketers are to achieve their ultimate goal of profit. • Essentially a business needs to be able to target its promotional and distribution efforts towards a particular chosen market segment.

  5. Return Physical Access to Chosen Markets How to access the target market?  The segment information must be obtained easily • Marketers need to be able to easily obtain information about the segment so that they can deliver a marketing mix that will meet the target market’s needs, including appropriate distribution. Target market must be large enough • It is also important for the chosen target market to be large enough to ensure a profit for the business.

  6. Alternative distribution channels In-store & non-store marketing complement • In-store & non-store marketing can complement each other. In many cases, instead of having the goods delivered, the retail shopper will take them home themselves, compensating somewhat for the need to provide a special retail outlet.

  7. Return Alternative distribution channels (con’) • Means of distribution for direct marketing will also depend on the form that the purchased goods or services take. e.g. if the purchase is a hair cut and style, the notification or coupon for redemption may be sent via ordinary mail, the web or email. However, the delivery of actual service will most likely be in salon. The salon would need to be physically accessible to the chosen target market segment. • Many entrepreneurial intermediaries adopt the two channel system. • e.g. Pizza Hut  A company having more than one option for distribution depending on accessibility of the chosen market and its distance from the ordering and storage centre. e.g. Pizza Hut

  8. Return Demographics & Distribution • Demographics • Influence the nature of customers’ needs • Influence choice of distribution channels Yong group and old people DINKs – dual income no kids Empty nesters--RORFs – retired old rich folks Urban migration • Distribution channels to cope with urban spread

  9. Return Error Correction Code Format Control Delivery Point Identifier (DPID ) Customer Information Stop Start 2 bars 4 bars 16 bars 31 bars 12 bars 2 bars Mail options • BDMS—bulk direct mail services • BPMS—bulk pre-sorted mail service • Advertising mail discount • Household delivery service DPID- delivery point identifier PAF- postal address file The structure of information stored within the barcode

  10. Quality addressing • Central to the success of bar-coding is the concept of “quality addressing.” Benefits of quality addressing • Because of enhanced accuracy of addressing, there will be a reduction in the amount of “return to sender” mail. This naturally diminishes wastage on production and postage. • Quality addressing will enhance the ability of businesses to ‘household’ match their mail communications. • As of April 2000, companies who lodge Pre-sort bar-coded mail have cheaper mail prices • Because of better prospect selection, companies using quality addressing will have increased response rates

  11. Return Quality addressing (cont’d) Benefits of quality addressing • The data quality is of a very high standard, thus data management costs will be lower • The envelope will be freed up to permit greater creativity • This system will process mail much faster and therefore delivery can be relied upon to be sooner than without the system. it will also ensure more accurate delivery. • Bar-coded letters avoid several sorting processes common to non bar-coded system, thus saving time and money.

  12. Barcode How to barcode? (AMAS)

  13. Application Snapshot How to barcode? There are three main steps to barcoding letters: • The first step is to identify and modify your customer database to store the DPID as a fixed and mandatory part of the address file structure for each record. • The second step is to validate address information. • The third step is to print the barcode.

  14. Return The address matching approval system (AMAS) There are three basic choices to in how to barcode your mail yourself: • develop AMAS-approved address matching software yourself • purchase AMAS-approved address matching software from a third party • use outsourced bureau services for address matching

  15. Return Outsourcing to skilled operators  Depends on locations and accessibility of customers, size, shape and/or weight of goods, fragility or perishability of goods, need for security in transportation among other things.  Direct marketers may use more than one delivery service e.g. air transport for urgent; overnight deliveries to distant regions  May use inter-modal (two or more modes of transport systems)  May need understanding of Customs and Excise regulations

  16. Electronic Distribution • Electronic data interchange (EDI) • Download from the Internet • Transmission of information, pictures, music and other data • Electronic data interchange (EDI) can be use for: • E-ticketing for airlines Where the booking is made and paid for over one electronic medium and the verification is sent via email or message to the customer. The customer only has to pick up their seat allocation at the airport. • Maybe used for bills of lading exchange, freight billing, funds transfer, software and so on

  17. Summary • The marketer must know their target market. To do this well they need to get close to the market. That means they need to access their target market to find its needs. • The demographic of a market can also help determine the forms of distribution likely to appeal. Australian consumers are still relatively in their infancy as catalogue or mail order buyers. It shows the different distribution can be accept by different people. • The new Australia post postal address file (PAF) will bring large efficiencies to the postal system. The super mailers will gain the benefits of cost savings plus faster delivery of their mail. • Perhaps more importantly, outsourcing brings with it the expertise of skilled operator in these areas. • Electronic transmission distribution is still relatively unexplored.

  18. The end of chapter 15

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