Perreault−McCarthy: Basic
Marketing: A
Global−Managerial
Approach, 14/e- Place and Development
of Channel Systems
Text © The McGraw−Hill
Companies, 2002306 Chapter 11
Exhibit 9-3 shows the relationship between consumer product classes and ideal
Place objectives. Similarly, Exhibit 9-4 shows the business product classes and how
they relate to customer needs. Study these exhibits carefully. They set the frame-
work for making Place decisions. In particular, the product classes help us decide
how much market exposure we’ll need in each geographic area.A product may be sold both to final consumers and business customers, and each
type of customer may want to purchase in different ways. Further, several different
product classes may be involved if different market segments view a product in dif-
ferent ways. Thus, just as there is no automatic classification for a specific product,
we can’t automatically decide the one best Place arrangement.
However, people in a particular target market should have similar attitudes and
therefore should be satisfied with the same Place system. If different target segments
view a product in different ways, marketing managers may need to develop several
strategies, each with its own Place arrangements.The marketing manager must also consider Place objectives in relation to the
product life cycle; see Exhibit 10-2. Place decisions often have long-run effects.
They’re usually harder to change than Product, Price, and Promotion decisions.
Many firms that thought they could quickly establish effective websites for direct
online sales, for example, found that it took several years and millions of dollars to
work out the kinks. It can take even longer to develop effective working relation-
ships with others in the channel. Legal contracts with channel partners may also
limit changes. And it’s hard to move retail stores and wholesale facilities once leases
are signed and customer shopping patterns are settled. Yet as products mature, they
typically need broader distribution to reach different target customers.
The distribution of premium pet foods followed this pattern. A decade ago, super-
markets wouldn’t carry specialized pet foods because there wasn’t much demand.
So marketing managers for Science Diet products concentrated on getting distribu-
tion through pet shops and veterinary offices. These pet professionals were already
focused on Science Diet’s target market. Science Diet’s sales in this channel grew rap-
idly. What’s more, profit margins on the specialty foods were much higher than on
traditional fare. Seeing that this market was growing, Purina, Kal Kan, and other
producers developed new products and worked with their supermarket channels toMost pet food companies focus on distribution through grocery stores, but Science Diet brand premium pet foods reach consumers in the
U.S., Japan, and Italy through a different channel—veterinary offices and pet stores. Because Science Diet has developed cooperative
relationships with other members of this channel, Science Diet products often get special promotion support at the point of purchase.
Place system is not
automatic
Place decisions have
long-run effects