Consumers look for a product that will satisfy their needs and wants. Business operators need to understand their customers and their products requirement. They also need to understand how to deliver their products to their customers by establishing the best distribution channels. Customers will prefer a distribution channel that fulfils all their needs. This paper discusses the channel levels, analyses the target customers’ needs, and determines how digital commerce influences product distribution.
Distribution channels are divided into direct and indirect distribution. A distribution channel assists customers in acquiring their desired products or service. The consumer purchases the product directly from the producer’s physical or online stores. Direct distribution helps build relationships with consumers. It also ensures the collection of accurate mailing lists that enhance effectiveness in distribution. Customers also receive the products faster, and the company responds to their feedback quickly(Burnett, 2011). Despite the advantages, direct marketing limits the chances to reach customers through networks which intermediaries would establish (Burnett, 2011). Also, the potential market is limited.
Indirect distribution, the customer purchases a product from a wholesaler, a retailer, or other agents within that market. According to Burnett, 2011, this channel enhances mass marketing through wholesalers and retailers’ additional networks. Also, customers can easily access the products. The main challenge of indirect distribution is the lack of personal communication between the producer and the customer (Burnett, 2011). It also creates a wide separation between the producer and the customer. Consumers should choose a distribution channel that suits their needs.
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Producers also must determine their target market needs to deliver products to them. For producers to understand their customer’s requirements, they need to study their behaviors of consumption. Understanding consumers’ psychological and backgrounds enable producers to produce what makes their customers happy (Bython Media, 2018). Additionally, producers get an opportunity to inform their consumers what their products are and why they need to purchase their products. Also, a company understands that millennials and Gen-Z have different needs requirements (Goldman Sachs, 2016). These differences arise from technological influences because the Gen-Z generation has comprehensive usage of technology than the millennials. Producers should ensure they understand their consumer’s needs.
There are various factors in which customers consider in a distribution channel. Customers prefer a distribution channel that delivers what they want, the one that delivers at their point of convenience, and finally, the one that delivers their products at the right time(365 Careers, 2017). To satisfy these needs, producers should adopt ERP systems to reduce production time automatically.
Companies have incorporated digital commerce in their distribution processes. Digital commerce allows customers to learn about a product without physical visitation of stores. This marketing model has helped companies with the mass production of products and many outlets in different places. For example, Nike Company has little interaction with its customers, but it delivers and satisfies their needs throughout its various retail outlets (Burnett, 2011). Digital commerce has also increased customers’ power as they control where, how, and when they can shop in various online mobile channels such as Amazon. Therefore, digital commerce has simplified distribution processes as consumers can even access products using their mobile phones.
In conclusion, for companies to deliver their products to consumers, they must determine their customers’ needs, the type of distribution channel, and the digital commerce to use. To succeed in distribution, companies should select a distribution channel that delivers the right products to consumers, at the right place, and at the right time. Producers should also adopt digital commerce to facilitate distribution.
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365 Careers. (2017). The Marketing Mix – Product distribution [Video].
Burnett, J. (2011). Introducing marketing (1st ed.).
Bython Media. (2018). Why Consumer Behavior is Vital for Success in Marketing [Video].
Goldman Sachs. (2016). Gen-Z Matters More than Millennials: Goldman Sachs’ Christopher Wolf [Video].
Rickards, L. (2015). Distribution Channels [Video].