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Original post : 12 Sep 2012

Marketing Planning - How could you get there with Place?

Speeding trucksPlace boils down to how easy it is for customers to buy from you. Great products and services, even priced attractively, are not going to be successful if customers can't get their hands on them. Or if, when they do, they have a bad service experience. (By the way, we're on step 3d of our marketing planning series now if you're following us - the other parts can be found here.)

Place comprise 3 main elements:

  1. Physical distribution
  2. Marketing channels
  3. Customer service

Each of these should be addressed in your planning. It's important to actively decide if each of the elements is relevant or not, rather than just glossing over it. So, taking each of these in turn...

Physical distribution

Also know as logistics. What stages does your product go through to get to the customer? If you're not the producer then you may be some way along the supply chain yourself (a retailer or distributor for example) and you may not feel you have a lot of control over the distribution strategy, but you need to understand how it works. How you buy and who from will be a key input to your cost structure.

You may also be buying component parts that you use to create your final product or service rather than the whole finished product. Either way, the distribution strategy is about ensuring you can get your hands on the right quality of product, in the right timeframe to enable you meet your customers' needs. It's about cost of course, but also about delivery timescales, inventory management, responsiveness, etc..

You need to know where you are in the supply chain - who are your customers? Are they other suppliers or intermediaries or are they the end-user? The needs of each audience will vary. Consider what options you have to streamline the process and lower the cost to you, while not compromising on what you offer to your customers. What do you need to be able to differentiate your service from the competition?

Marketing channels

The next part of the supply chain is how the goods or services get to the end-user customer. This could be a retail store or online via a website, a broker or an agent, or simply direct sales from your own people. You may use a mix of channels depending on your product portfolio.

A major trend in recent years has been 'disintermediation', where customers are giving the opportunity to get closer to the source of production to make their purchases, 'cutting out the middle man' and lowering prices by cutting out costs. This process has been facilitated by ecommerce giving easier access to customers by suppliers.

Interestingly we now have a growing trend in 'reintermediation' - specialists to help source the best deals for customers. Some products and services are complex to buy and far too time-consuming for individuals or organisations, so it makes economic sense to pay someone else to do the legwork and, perhaps, the negotiation.

What marketing channels do you use? Are there any you could use but have not considered? How could you make them more efficient and/or effective?

Customer service

The service your customer receives in buying your products will be based on the decisions you have taken above. Availability of the product, delivery timescales, returns and repairs are all things that customers will judge their experience on, and information on these beforehand will be a critical factor in their initial decision to buy, as well as the reality driving repeat business.

Your ability to charge higher prices will improve based on the value you are seen to provide through the distribution service. And clear communication will help in the sales process and manage expectations - over promising and under delivering is a definite no-no!

Right product, right time

Marketing is all about getting the right product to the right customers at the right time at the right price. But to make a profit you are going to need to balance all the different elements of the equation to get to that right price  - the customer may say they want everything right now but in reality they will flex that need based on how important it is to them, and that will affect what value they put on express delivery rather than having to wait a week, for example.

Your operational flexibility will be another factor in determining how many different options you are capable of offering to customers, and your knowledge of your target customers (from your earlier analysis) will allow you to design your service offerings appropriately.

For now, make a note of any issues and opportunities you have identified for your business under the heading of Place - and we'll move on to Promotion!

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