Advertising and distribution
GOOD DAY. In this week’s lesson, we will explain advertising and distribution and the final two marketing activities listed in the syllabus. It must be noted that advertising is also a method of promoting sales and is, therefore, listed under Objective 2 – Marketing Activities, and Objective 6 as a method of promoting sales.
ADVERTISING
Advertising may be regarded as the art of putting the good, and sometimes bad, points about a good or service across to large numbers of potential or existing customers.
Advertising has many functions:
■ It is an aid to trade – increased market share comes from stimulated demand.
■ It is a means of competition against other sellers of similar goods and services.
■ It brings buyers and sellers into close contact.
■ It informs – announcing new products and telling potential consumers about them.
■ It helps to build a firm’s image around its products.
■ It highlights the unique features of products and convinces consumers to buy.
FORMS OF ADVERTISING
(a) Informative – This is concerned with notifying the general public about the existence of certain goods and services. It is normally used as new products are put on the market. (b) Persuasive – Most are of this type. Slogans, pictures and jingles are used to convince or coerce consumers to buy the product. Appeals are used, e.g., sex appeal: cars, soap, cologne, alcohol, cigarettes, etc. (c) Competitive – This aims at defending the value of the product against that of its competitors. The aim is to convince your potential customer that your product is better than others. (d) Co-operative/Collective – This is joint advertising by groups of companies or industries that pay jointly for the advertising. It tells the consumer to buy the product rather than
a particular brand, e.g., cheese, milk, etc. (e) Specialty – This is advertising in which very small but expensive objects or items are given away freely to persons, e.g., T-shirts, pens, key rings, knives, nail clippers, etc. These items usually have the names or initials of companies or firms on them. (f) Reminder – This is important when a product is mature, i.e., it has been on the market for a long time or there are several similar brands on the market, e.g., soft drinks.
Advertising media include television, newspapers and magazines, radio, billboards and sky writing. Very important in our modern era is advertising on social media, such as Facebook and WhatsApp, where thousands of potential buyers can be found and information and goods and services can be at one’s ‘fingertips’. Buying and selling become convenient, easy and effective.
Now we will move to discussing distribution as the final marketing activity.
Distribution has to do with the movement of goods and services from the point of manufacturer to the final consumer who will utilise it. It is an indirect service since indirect services involve the movement of goods.
Direct services such as plumbing,
hairdressing and teaching go directly from the point of manufacturing to the point of consumption. This is known as direct distribution. Direct distribution is where there are no middlemen in the process of distribution.
Manufacturer ––– Consumer
Indirect distribution involves one or more middlemen in the movement of goods from the manufacturer to the consumer. These middlemen include wholesalers and retailers. For example, consider the diagram below:
Manufacturer ––– Wholesaler ––– Consumer
This is known as a ONE-LEVEL method of distribution since there is only one middleman present. In this case, the manufacturer sells to the wholesaler, in bulk, who then breaks the bulk and sells to the consumer. The diagram below shows another ONE-LEVEL method of distribution, this time with the retailer as the middleman.
Manufacturer ––– Retailer ––– Consumer
In this case, the retailer would be a large one, capable of acting almost like a wholesaler. It would be in your best interest at this point to do some research on the functions of wholesalers and retailers and note their similarities and differences.
The most common form of distribution involves the wholesaler and the retailer, and is known as a TWO-LEVEL method of distribution, since two middlemen are present between the manufacturer and the consumer.
Manufacturer ––– Wholesaler ––– Retailer ––– Consumer
The more middlemen present before reaching the consumer, the more the bulk is broken down and likely the more expensive the goods will be when they reach the final consumer, since the work down at each stage has to be paid for and is passed on to the next stage.
Distribution is an important part of marketing. If goods and services do not reach the consumer, then marketing has not taken place, since we see marketing as getting the right goods and services to the right people at the right price while making a profit.
Next week we will describe the methods of promoting sales. This is Objective 6 of Section 6 Marketing.