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Place/distribution as an element of the marketing mix

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Lauren Burke

on 21 November 2014

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Transcript of Place/distribution as an element of the marketing mix

Place/Distribution as an Element of the Marketing Mix
Ilona, Lauren, Samantha, Carmel & Megan.
Definition of marketing mix.
Definition of place in the marketing mix.
Advantages and Disadvantages of place and distribuition in the marketing mix.
The presence of place and distribuition in the travel and tourism industry today
Case Study
Where you listening?
Place in the Marketing Mix
Using the marketing mix helps businesses to adjust either the price, features, appearance or method of distribution of a product to suit their target market.
Wether or not the marketing mix is sucessful for a business, it can only be told through an increase or decrease in sales after using the marketing mix strategy.
The diagram below illustrates the marketing mix.
The main element of the marketing mix we are discussing today is place.
This refers to how a business will disribute the product or service they are trying to sell to their customer.
There is two types of distribuition methods that are used.
1. Direct to a consumer
2. Indirect through intermediaries.

A marketing place is....

"a set of interdependent organisations that help make a product or service available for use or consumption by the consumer or business user."

Kotler et al (2010)

Place is key in selling products or services.

A product or service can be sold through a single channel or a multiple channel.

An example of a product sold through a multiple channel would be coca-cola.

There is also 5 different intermediaries for place in businesses:
1. Wholesaler
5.Licencing and Franchising

4. Internet is good for businesses as it gives them access to a much wider audience. The people are geograpically dispersed. The consumer has confidence in the internet market.

5. Licensing relates to the manufacturing of goods in a particular place and franchising is about the whole experience worldwide. Franchising is used with brand names where there is a particular format.
The marketing mix is 4 elements which work equally together in a business to sucessfully sell a product or service.
If a business wants to sell their product or service and be sucessful they need to take these 4 elements into consideration.
According to Cim,
" These elements are interdependent - altering one part of the mix will often result in you having to alter another to keep the balance right.
1. Wholesalers are buyers who buy in bulk. They will reduce the amount of physical contact between the producer and the consumer.

2. Agents are similar to wholesalers however agents will essentially secure a sale and then take a commission. The difference between agents and wholesalers is that agents dont actually take title to the product whereas wholesalers will.

3. Retailers shops,malls and stores. They have a much stronger personal relationship with the consumer. This is where the final purchase often takes place. The retailer will give the final price to the product.
Case Study.
It is europes only ultra low cost carrier

Ryanair is Europe’s favourite airline, operating more than 1,600 daily flights from 70 bases, connecting 183 destinations in 30 countries

Founded in 1985

One of the Europes largest carriers
“Place includes company activity that makes the product available to the target customer" (Kotler, 2009)

Distribution activity or place plays an important role in customer satisfaction; it is achieved only when the customer has received the right quantity at the right time and place. (Douglas, James and Ellram, 1998)

Ryanair cont.
No agency commission
Online booking
Based in Stansted, Essex

Secondary airport destinations

Costs are lower and aircraft can be turned faster
Low cost jigsaw
Reference List
Friesner, T. (2014). Ryanair Marketing Mix. Available: http://www.marketingteacher.com/ryanair-marketing-mix/. Last accessed 12th Nov 2014.
Kotler, P. & Armstrong, G. (2010) Principles of Marketing.13th(Global) ed. Boston: Pearson Education, Inc.
Advantages and disadvantages of place in the marketing mix.
Foot traffic
Marketing at low cost
Consumers may buy competitors product instead
Could be expensive to build on centre location
Rise in competition
Marketing at high cost
White Horse Hotel
Ease of access
Could be cheaper in price to book
Private area
May be too far out from city
Quiet area

/The Advantages of Opening a Store in a Busy Area by George N. Root III, Demand Media http://smallbusiness.chron.com/advantages-opening-store-busy-area-17611.html
Presence of Place (Distribution) within the Tourism Industry
Tourism today is recognised widely as a trade industry and is highly competitive.
For businesses to be successful due to the competitive nature in today’s industries they must provide a quality product that satisfies the customer needs.
They also must use the marketing elements to establish what the tourist wants but also what they can provide in terms of profit.
Presence of Place (Distribuition) within the Tourism Industry
Place (Distribution) in the Tourism Industry cont
Place in case of services determine where is the service product going to be located (Philip Kolter, 2007)

Tour time
Tour distance from a certain spot
Give information from different travel routes
Informing potential tourist and customers
Selecting attractions and facilities along different travel routes
Within the tourism industry, place (distribution) consists of providing a guideline about different tourist’s spots:

Tourism products and services are designed and continuously tailored to match the tourists/customer needs
The location of the point of sale is important to provide the customers with access to tourist products
The tourist attraction or experience is the product!
Place (Distribution) in the Tourism Industry cont.
How to get the Product to the Market
Direct Distribution:
The business takes full control of taking the tourism product to the market

Indirect Distribution
Business use third party methods by means of tourism distribution channels
Distribution Channel
Case Study: Place Distribution and Tourism Marketing for the London & Tower Bridge
London & Tower Bridge
“We aim to keep the London Bridge area firmly on the tourist map, encourage inward investment, and help local employees and residents make the most of the fabulous area they work in.” (Team London Bridge, 2011)

The following objectives were undertaken:

Developing a strong place identity
Providing a visitor website
Producing local guides
Employee orientation
Working in partnership
Visitor and attraction promotion

References continued
Uni Assignment Centre. (2014). Marketing Mix Of Tourism Industry Tourism Essay. Available: http://www.uniassignment.com/essay-samples/tourism/marketing-mix-of-tourism-industry-tourism-essay.php. Last accessed 17th November 2014.
Mohammad Amzad Hossain Sarker. (2012). Investigating the Impact of Marketing Mix Elements on Tourists . European Journal of Business and Management . 4 (7), 274
Team London Bridge. (2011). Place Promotion and Tourism Marketing for the London Bridge and Tower Bridge. Available: http://www.teamlondonbridge.co.uk/default.aspx?m=42&mi=175. Last accessed 15th November 2014.
References continued
Team London Bridge. (2011). Place Promotion and Tourism Marketing for the London Bridge and Tower Bridge. Available: http://www.teamlondonbridge.co.uk/default.aspx?m=42&mi=175. Last accessed 15th November 2014.
NT Tourism . (No Date). Travel distribution system. Available: http://www.tourismnt.com.au/industry-resources/tourism-resource-guide/travel-distribution-System. Last accessed 15th November 2014.
Quiz Time!
Question 1

Can you name one disadvantage of place as part of the marketing mix?

Why do you think this?
Question 2

Can you name one advantage of place as part of the marketing mix?
Do you agree?
Question 3
What are the 4 elements of the marketing mix?
Question 4
Can anyone name a franchise mentioned in the powerpoint?
In conclusion place/distribution as an element is an important aspect it has advantages and disadvantages. Advantages being without an in-depth thought where the product will be sold would determine how successful the product would be. On the other hand the disadvantage of place being part of the marketing mix is that if the wrong place is selected for the product the product could end up costing the company.
Distribution strategies
Depending on the type of product being distributed there are three common distribution strategies available.

Intensive Distribution

Exclusive Distribution

Selective Distribution
Intensive distribution is a marketing strategies under which a company sells through as many outlets as possible, so that the consumers encounter the product virtually everywhere they go.

Intensive distribution is used commonly to distribution low priced or impulse purchase products for example Chocolate and Soft drinks which would be sold in the likes of:
Intensive Distribution

Exclusive distribution is where suppliers and distributors enter into a exclusive agreement that only allows the named distributor to sell a specific product.

The product is usually highly priced and requires the transitional to place much detail in its sell. An example of this would be the sale of vehicles through exclusive dealers and Apple with their exclusive distribution deal with AT&T to provide the iPhone to consumers.
Exclusive Distribution
Selective Distribution

Selective distribution is a type of product distribution that lies between intensive distribution and exclusive distribution, and in which only a few retail outlets cover a specific geographical area.

Selective distribution is considered more suitable for high-end items such as 'designer' or prestige goods.

Examples of selective products are computers, televisions and household appliances.
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