Distribution Decisions

The customer has rightly become the central focus for designing and implementing all decisions in marketing. Most successful companies have remained close to the customer by developing a very clear understanding of ‘consumer behaviour’ dimensions. Distribution is one of the most critical parts of the marketing-mix strategy and consumer behaviour insights strongly drive the structural and process related decisions in this area. Distribution decisions are basically ‘channel management’ decisions and the service outputs of a distribution channel (namely lot size, waiting time, spatial convenience and variety) need to be structured differently for different target segments based on their pattern of preference. A consumer with limited purchasing power would prefer a smaller lot size of a category/product for which the distribution system will have to create long, third-party based, multi-level channels where successive break-of-bulk operations will take place till at the retail level very small bulks are broken to meet the small lot size demand of the customer.