What is Distribution Strategy
Distribution strategy refers to the plan a company uses to make its products or services available to customers. It includes decisions about which channels or intermediaries to use, such as distributors, wholesalers, or retailers, as well as how to reach end customers directly.
The purpose of a distribution strategy is to ensure that products or services are available to customers in a convenient and cost-effective manner. This can involve reaching customers through a variety of channels, such as brick-and-mortar stores, online marketplaces, or the company's own website.
The role of distribution in a company's overall marketing strategy is to make the product or service available to the end customer. This involves coordinating the activities of intermediaries and logistics providers to ensure that the product or service reaches the customer in a timely and cost-effective manner.
The importance of distribution cannot be overstated, as it plays a key role in the success of a product or service. A well-designed distribution strategy can help a company reach more customers, increase sales, and achieve a competitive advantage in the market.
Components of a distribution strategy may include:
- Channels: the intermediaries or channels through which the product or service will be made available to customers
- Coverage: the extent to which the product or service is available to customers through different channels
- Assortments: the range of products or services offered through each channel
- Locations: the physical locations where the product or service is available
- Transportation: the means by which the product or service is delivered to customers
Examples of distribution strategies include:
- Direct distribution: selling directly to end customers through the company's own website or retail stores
- Indirect distribution: using intermediaries such as distributors or wholesalers to reach end customers
- Omni-channel distribution: using a combination of direct and indirect channels to reach customers through multiple touchpoints, such as online and offline channels
- Exclusive distribution: limiting the distribution of a product or service to a single channel or intermediary
- Intensive distribution: making a product or service widely available through many channels and intermediaries