Distribution, Promotion, and Selling

Distribution, Promotion, and Selling 6.1 The Marketing Mix─Distribution 6.2 The Marketing Mix─Promotion 6.3 Selling and Promoting

Lesson 6.1The Marketing Mix─Distribution Goals • Describe the four basic options of channels of distribution. • Apply channels of distribution to the specific needs of various types of businesses. • List factors to consider in the physical distribution of products. Chapter 6

Vocabulary • supply chain management • distribution • channels of distribution • direct channel • indirect channel • physical distribution Chapter 6

Supply Chain Management • supply chain management • the coordination of manufacturers, suppliers, and retailers working together to meet a customer need for a product or service Chapter 1

distribution • involves the locations and methods that are used to make products available to customers • channels of distribution • the routes that products and services take from the time they are produced to the time they are consumed Chapter 6

Direct and Indirect Channels • direct channel • moves product directly from the manufacturer to the consumer • indirect channel • uses intermediaries • people or businesses that move products between the manufacturer and the consumer Chapter 6

Channel Options Chapter 6

Manufacturer to Consumer • sales methods may include: • the Internet • direct mail • television shopping channels • no intermediaries • most cost-effective • limited sales opportunities Chapter 6

Manufacturer to Retailer to Consumer • sales force sells goods to retailers • retailers sell goods to consumers • offers more sales opportunities Chapter 6

Manufacturer to Wholesaler to Retailer to Consumer • manufacturer sells large quantities to a wholesaler • wholesaler stores and sells smaller quantities to many retailers • lower production costs can lead to lower prices Chapter 6

Manufacturer to Agent to Wholesaler to Retailer to Consumer • The manufacturer delegates the sales function to an agent. • frequently used in international marketing Chapter 6

What are the four basic options of channels of distribution? Chapter 1

Distribute Goods and Services • Distribution channels will vary based on business needs. • market size • type of product or service • customer needs and wants Chapter 6

Retail Businesses • Retail businesses can distribute products in a variety of ways. • offer the product at a convenient location during convenient times • use advertising to reach customers • allow for phone or fax ordering • develop a website for online purchases Chapter 6

Service Businesses • Most service businesses sell directly to customers. • production and consumption of the service happens at the same time • the service needs to be provided to the customer when the customer needs it • some service providers sell through retail stores Chapter 6

Manufacturing Businesses • Manufacturers usually sell products to other businesses. • The other businesses sell to the final consumer. Chapter 6

Why are channels of distribution different for different types of businesses? Chapter 1

Physical Distribution • Physical distribution • transportation • storage • handling • packaging Chapter 6

Transportation • The best and most cost efficient transportation method should be determined. • The type of product and the destination of the product will help guide the decision-making process. Chapter 6

Product Storage and Handling • Benefits of efficient storage include: • balancing supply and demand of products • Other considerations of storage include: • adds to the cost of products • increases the risk of damage or theft Chapter 6

Packaging • The purpose of packaging is to protect the product from the time between production and consumption. • Effective packaging provides value by minimizing product damage. Chapter 6

Receiving Goods to Sell • All types of businesses must receive goods from suppliers. • Sources that can be consulted to find suppliers include: • The American Wholesalers and Distributors Directory • The ThomasNet website • Trade magazines Chapter 6

What factors are important to consider in the physical distribution of products? Chapter 1

Lesson 6.2The Marketing Mix─Promotion Goals • List the many forms of advertising and discuss advantages and disadvantages of each. • Define publicity and describe ways to use publicity as a promotional tool. Chapter 6

Vocabulary • advertising • publicity • press release • public relations Chapter 6

Promotion Strategies • promotional mix • advertising • publicity • personal selling • sales promotion Chapter 6

Advertising • advertising • a paid form of communication sent out by a business about a product or service • Advertising is very important for small and/or new businesses. • Advertising should clearly communicate your message and image. Chapter 6

Online Advertising • Online advertising has increased as Internet usage has grown. • Online technology lets businesses interact with consumers via • chat rooms • blogs • e-newsletters Chapter 6

Common types of online advertising include the following: • Banner Ad • Floating Ad • Wallpaper Ad • Trick Banner • Pop-Up Ad • Pop-Under Ad Chapter 6

As it is easier to determine the effectiveness of online advertising than traditional advertising, new methods to charge for online advertising have been developed. Chapter 6

Three common ways to charge for online advertising include: • Cost per Mil (CPM) • the advertiser is charged based on the exposure of the message to a specific audience • priced per thousand viewers reached with the message Chapter 6

Cost per Click (CPC) • the advertiser is charged based on the number of user clicks on the advertisement • viewers respond to the ad by clicking on the hyperlink within the ad • Cost per Action (CPA) • the advertiser is charged when a user takes an action that leads to a sale • the publisher of the ad assumes all the risk in running this type of ad • advertisers prefer this type of charge for banner ads Chapter 6

Disadvantages of Online Advertising • In an effort to combat excessive spamming, many Internet users now utilize software that blocks promotions from reaching their computers. Chapter 6

Don’t forget: You can copy-paste this slide into other presentations, and move or resize the poll. Poll: What are three examples of online advert...

Don’t forget: You can copy-paste this slide into other presentations, and move or resize the poll. Poll: What is the difference between CPC and C...

Don’t forget: You can copy-paste this slide into other presentations, and move or resize the poll. Poll: An online ad that changes the background...

Television Advertising • commercials • last less than a minute • infomercials • last a half hour or more • provide in-depth coverage about a specific product Chapter 6

Fees associated with television advertising include: • the fee paid to the station for airing the commercial • based on the length of time the commercial plays • the costs of producing the commercial Chapter 6

Disadvantages of television advertising include: • it is very expensive • the audience is too broad to be effective for most businesses Chapter 6

Radio Advertising • less expensive than television advertising • listener demographics are more specific than television • easier to reach target audience • pay for air time • pay for production costs Chapter 6

Disadvantages of radio advertising include: • the message is purely audio • a visual of the product is not shown • listeners may forget what they hear • listeners may “surf the airways” during commercials Chapter 6

Newspaper Advertising • Historically, newspapers were the single largest form of advertising in the U.S. • Advantages of newspaper advertising include: • relatively inexpensive • targets a limited geographic area • reaches a large number of people Chapter 6

Disadvantages of newspaper advertising include: • Many people in the audience may not be interested in your business. • Your ad faces a lot of competition from many other ads in the newspaper. Chapter 6

Don’t forget: You can copy-paste this slide into other presentations, and move or resize the poll. Poll: A radio station will provide a psychogra...

Don’t forget: You can copy-paste this slide into other presentations, and move or resize the poll. Poll: What is a major advantage of newspapers ...

Telephone Directory Advertising • Consumers use telephone directories repeatedly. • Ads usually appear close to the listing and phone number of the business placing the ad. Chapter 6

Disadvantages of telephone directory advertising include: • People only look in the directory when they are already seeking a specific business. • It is hard to persuade a potential customer to use your business instead of your competitor’s business. Chapter 6

Direct-Mail Advertising • promotional materials sent to target customers through the mail • Companies that specialize in maintaining targeted mailing lists can provide almost any type of list needed. Chapter 6

Disadvantages of direct-mail advertising include: • Direct-mail is often considered to be “junk mail.” • It often gets discarded without being read. Chapter 6

Magazine Advertising • Magazines are an excellent way to aim products and services at specific markets. • Local magazines that target a limited geographic area are often the best choice for small businesses. Chapter 6

Distribution, Promotion, and Selling