- Intensive Distribution: As many outlets as possible. The goal of intensive distribution is to penetrate as much of the market as possible.
- Selective Distribution: Select outlets in specific locations.
- Exclusive Distribution: Limited outlets.
What is meant by selective distribution?
Selective distribution is a marketing strategy used by the company where they select only a few retailers or distributors from each city or region rather than appointing anyone who applies for distributorship of products of the company.
What is the difference between exclusive and selective distribution?
- Intensive Distribution: As many outlets as possible. The goal of intensive distribution is to penetrate as much of the market as possible.
- Selective Distribution: Select outlets in specific locations.
- Exclusive Distribution: Limited outlets.
What does selective distribution mean in marketing?
Selective distribution is a retail strategy that involves making a product or group of products available only in certain markets. This is the opposite of open distribution, where a product line is distributed to as many markets as possible.
What are some examples of selective and exclusive distribution?
- Marketing
- Operations & SCM
- Human Resources
What is selective distribution in marketing?
Selective distribution involves selling a product at select outlets in specific locations. Exclusive distribution involves selling a product through one or very few outlets.
What is a selective distribution product?
What is Selective Distribution? Selective distribution is considered to be a medium level of product availability that seeks to balance product availability with inventory and storage costs. Selective distribution is used when we don't need to have the product on every corner market shelf.28-Sept-2021
Which of the following is an example of selective distribution?
A good example for products for which selective distribution is used is cars. This need not be the case for high end luxury cars, for which, more often than not, exclusive distribution is used. For the low-end range and mid-level range cars, selective distribution is used.14-Feb-2018
Why do companies choose selective distribution?
Selective distribution allows to differentiate between luxury products and potentially competing – albeit more “common” – products. It mainly allows to manage scarcity and prestige, which constitute two of the essential characteristics of luxury products.13-Oct-2014
Is Nike selective distribution?
Nike can restrict sales via online platforms within its selective distribution system. ... Firstly, the District Court held that Nike's distribution system qualified as a 'selective distribution system' and that Nike had applied the selection criteria uniformly and without discrimination.01-Nov-2017
What is selective distribution and its example?
Selective Distribution involves using more than one, but lesser than all the intermediaries and distributors who carry the company's products on a basis of a company specific set of rules. Mostly furniture, television and home appliance brands are distributed in this manner.29-Dec-2020
What companies uses selective distribution?
High-end companies that produce exceptional quality clothing and accessories are likely to use selective distribution. For example, you may find Dolce & Gabbana products in stores like Neiman Marcus but not at JC Penneys or Wal-Mart. This is done set standards and keep a close eye on distributors.
What companies are selective distribution?
Selective Distribution For example, clothing from different brands may be offered selectively. A brand like Gucci may choose to distribute its items to its own stores in addition to a few selected department stores rather than placing its products in a range of locations such as Walmart or Target.30-Jan-2022
Does Apple use selective distribution?
Apple has adopted the selective distribution strategy with exclusiveness,In this push strategy is used (Wilkinson 2013). ... Android phone of google with tripled market share in just 3 months is the main competitor of apple in Us but still it dominates the market.19-Sept-2016
Does Samsung use selective distribution?
In what is being called a “soft launch”, Samsung is only distributing the new range of notebooks through four retail organisations, each one chosen to target a specific demographic. ...27-May-2009
What would be the benefits of using selective distribution instead of intensive or exclusive distribution?
It also enables the firm to establish a good working relationship with channel members. Selective distribution can help the manufacturer gain optimum market coverage and more control but at a lesser cost than intensive distribution. Both existing and new firms are known to use this alternative.
What are the benefits of selective distribution quizlet?
Selective distribution, in general, supports higher prices than does intensive distribution. - selling through only a few retailers. The retailer has the exclusive right to distribute the product in their geographic area.
What is selective distribution?
Selective distribution is a type of channel distribution where a company or a brand chooses a certain set of outlets through which they can further make their products available to the consumers.
Why is distribution important in marketing?
Distribution plays a major role in one’s marketing strategy, and this is more so because unless and until your distribution is top-notch, the product won’t reach your desired consumers.
Is selective distribution a luxury car?
While exclusive distribution may happen for a very high-end brand range car, selective distribution is more so in the case of premium or mid-range but not luxury cars.
Selective Distribution - Explained
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What is Selective Distribution?
Selective distribution is considered to be a medium level of product availability that seeks to balance product availability with inventory and storage costs.
What is selective distribution?
Selective distribution is the most effective distribution strategy for high-end brands that want to set up a limited number of outlets in a particular geographical location. This is quite different from exclusive distribution (which can be a little too extreme) and is considered as a middle path approach to distribution.
Why are distributors handpicked?
This reduces the risk of fumbles, leading to increased consumer satisfaction.
Why is better communication important?
Better Communication. Because there are only a few number of outlets to oversee, manufacturers are able to establish good working relationships with channel members. Better communication and coordination ultimately leads to an improved brand image which is what most leading companies desire.
Can selection distribution increase market penetration?
Since products sold via selection distribution aren’t available everywhere, you may not be able to achieve increased market penetration. But of course, that depends on the goals of the organization.
Why is selective distribution important?
Selective distribution is gaining importance as it provides an optimal mid way solution between intensive and exclusive distribution.
Why is Raymond so selectively distributed?
But if you talk about Raymond, then Raymond has selective distribution because besides selling in its own exclusive outlets, Raymond is sold via franchise’s as well as in other other multi brand outlets. Watches of Titan are also selectively distributed because besides being sold in “World of Titan” they are also sold in selected outlets.
What is intensive distribution?
Intensive distribution is the method where every possible outlet is serviced and the company’s product is made available in that outlet. This is done especially for products where more availability leads to more sales. Example, cigarettes. Another reason for doing this is because some products are such that if one brand of it is not available, ...
What happens if a retailer does not stock multiple brands?
If the retailer agrees not to stock multiple competing brands or to limit the number of competing brands, this can reduce the competition within the store which is good for the brand.
Why do companies use all outlets possible?
Another reason for doing this is because some products are such that if one brand of it is not available, the consumer will simple choose another brand. This induces competition and hence a company uses all outlets possible to make its products available to the customers.
Can dealers store other brands?
The dealers in such a type of distribution network may or may not store other brands. They are not always obligated legally to confine themselves to just one brand. Selective distribution can also limit the competition faced to a certain extent. This can happen if there is a legal agreement of some sort between the producer and the retailer.
Why do we use selective distribution?
Generally, it can be said that there are two main reasons to choose or use selective distribution, mainly to maintain certain standards and qualities of branded products and to protect marketing and services investment by distributors. As will be seen, there is much importance of selective distribution, such as prevention ...
What is the difference between selective distribution and exclusive distribution?
The main difference between the models is that the selective distribution system restricts the selling on any sale to non-authorized distributors as well as restricting sales to other territories, while exclusive distribution only regulates the latter. Hence a selective distribution system leaves only appointed dealers and final customers as ...
How does selective distribution affect competition?
Selective distribution can be a threat to efficient intra- brand competition as well as leading to foreclosure on the distribution market.There is a risk that such systems lead to the competition being softened and collusion between suppliers being facilitated, especially where there is a cumulative effect of several selective distribution systems. Reduced intra-brand competition is harmful only where there is limited inter-brand competition. If a big part of the suppliers of a certain product uses selective distribution for the selling of their products, competition may be softened at both suppliers’ and distributors ‟s levels. Hence, it would also affect inter-brand competition which in turn would increase the effects of the reduced intra-brand competition.
What are the disadvantages of selective distribution?
Differences between selective, exclusive, and intensive distribution. Disadvantages of Selective Distribution. 1. Foreclosure of the market. 2. The motivates affect the effects on competition. When to use selective distribution.
What is the purpose of establishing a big selective retail network that involves most retailers?
By establishing a big selective retail network that involves most retailers, a manufacturer can prevent its competitors from accessing the market. If all the major retailers are tied to a selective network, the manufacturer‟s competitors must pay high prices for entering the market.
What is distributor or retailer?
A distributor or retailer is often required to invest in enhancing the demand for a manufacturer’s product, not only through such investments regarding the brand image as mentioned above but also through advertising, promotion, and before and after-sale services for the products in question.
Why does a supplier impose restrictions on distribution?
The supplier imposes restrictions on distribution with the aim of promoting the provision of services that are appreciated by customers, thereby increasing their demand , which, when used in the right way under the right circumstances, benefits the suppliers themselves and as well as customers and distributors.
What is Selective Distribution?
Selective Distribution is a type of distribution strategy that lies and operates between intensive and exclusive distribution. Selective Distribution involves using more than one, but lesser than all the intermediaries and distributors who carry the company’s products on a basis of a company specific set of rules.
Selective Distribution Example
The best examples would be of Whirlpool and General Electric who sell their major appliances through dealer networks and selected large retailers. They develop a good working relationship with these selected channel partners and expect a better-than-average selling effort.
Marketing dictionary
making a product available in more than one outlet, but not in as many as are willing to stock it; also referred to as Selective Selling.
Selective Distribution
making a product available in more than one outlet, but not in as many as are willing to stock it; also referred to as Selective Selling.
Selective Distribution
- Selective distribution occurs when a firm opens only a few outlets in a particular area. Sure, this may appear limiting at first, but it aids in the selection process. This results in superior outcomes and allows the corporation to devote all of its attention (training facilities and resources) to mor…
Examples of Selective Distribution Strategy
- A great way to see how selective distribution works is by looking at some notable examples of this tactic. Let’s take a look.
Intensive and Exclusive Distribution Strategies
- As the name suggests, intensive distributionis when a product is available to as many outlets as possible. This usually means that products are sold in bulk and at low prices, giving more prominent brands an advantage over smaller competitors who may not have the same marketexposure. Unfortunately, companies using these sales tactics often risk losing control ov…
Benefits of Selective Distribution Strategy
- Although it doesn’t seem like a significant advantage, selective distribution can be helpful for brands looking for ways to get their products in front of retailers’ customers while also limiting which goods make it to the shelves. This strategy is particularly beneficial for companies who want to get rid of excess stock and aren’t sure which markets will have higher demand or which …
Disadvantages of Selective Distribution Strategy
- Although selective distribution is a popular strategy, it does have some drawbacks. This sales tactic can limit distribution and reduce inventory costs for companies, but it can also make finding retailers more difficult. Another drawback to consider is that selective distribution agreements can lead to costly disputes when things go wrong due to the high value of the arrangements an…
Final Thoughts
- By using selective distribution, companies can choose which stores can sell their products based on their target market and economic status. Many brands have successfully used this tactic for years with varying degrees of success because it allows companies to experiment in different locations before choosing a permanent strategy. To learn more about selective distribution, the …
What Is Selective Distribution?
Why Do Companies Opt For Selection Distribution Strategies?
- A selection distribution strategy allows companies to select appropriate outlets according to different locations. Additionally, it’s highly beneficial for manufacturers since they’re able to choose price points based on their consumers. This eventually leads to a more personalized shopping experiencethat encourages consumers to come back again and again.
Selection Distribution Examples
- Since this form of distribution caters to the needs of consumers of a specific geographical area, its best suited for companies that want to maintain quality. This is why it’s no surprise that luxury goods manufacturers often opt for selective distribution. High-end companies that produce exceptional quality clothing and accessories are likely to use selective distribution. For example…
Selective Distribution Advantages and Disadvantages
- Depending on the organization and its goals, selective distribution offers its own set of advantages and disadvantages.
Disadvantages of Selective Distribution
- On the flip side, here are a couple of disadvantages that are associated with selective distribution: