DISTRIBUTION IN A SERVICES CONTEXT What? How? Where? When? Responses to these four questions form the foundation of any service distribution strategy. They determine the customer's service experience, which is a function of how the different elements of the Flower of Service (see Chapter 4) are distributed and delivered through physical and electronic channels. We summarize these questions in the Flow Model of Service Distribution in Figure 5.2. The "what" determines what exactly will flow through the distribution channel (i.e., information, negotiation, and the core and supplementary services). A distribution strategy needs to cover for each of these flows the remaining three questions of how, where, and when. This model is the organizing framework for this chapter, and the following sections describe each of its components. WHAT IS BEING DISTRIBUTED? If you mention distribution, many people are likely to think of moving boxes through physical channels to distributors and retailers for sale to end users. However, in services, there is often nothing to move. Experiences, performances, and solutions are not physically shipped and stored. Meanwhile, informational transactions are increasingly conducted via electronic channels. How, then, does distribution work in a services context? In a typical service sales cycle, distribution embraces three interrelated flows that partially address the question of what is being distributed: Information and promotion flow: This refers to the distribution of information and promotion materials related to the service offer The objective is to get the customer interested in buying the service. Negotiation flow: This is involves reaching an agreement on the service features and configuration as well as the terms of the off er so that a purchase contract can be closed. Often, the objective is to sell the right to use a service (e.g., sell a reservation or a ticket). Product flow: Many services, especially those involving people processing or possession processing, require physical facilities for delivery. Here, distribution strategy requires the development of a network of local sites. For information processing services such as internet banking and distance learning, the product flow can be via electronic channels, employing one or more centralized sites. It is important to distinguish between the distribution of core and supplementary services. Many core services require a physical location, and this severely restricts distribution. For instance, you can only consume Club Med holidays at Club Med Villages, and a live performance of a Broadway show must take place at a theater in Manhattan (until it goes on tour). However, many of the supplementary services can be distributed widely and cost-effectively via other means. Prospective Club Med customers can get information and consultation from a travel agent face-to-face, online, by phone, or by e-mail. Th ey can then use one of these channels to make a booking. Similarly, theater tickets can be purchased through an agency without the need for an advance trip to the physical facility itself.

DISTRIBUTION IN A SERVICES CONTEXT What? How? Where? When? Responses to these four questions form the foundation of any service distribution strategy. They determine the customer's service experience, which is a function of how the different elements of the Flower of Service (see Chapter 4) are distributed and delivered through physical and electronic channels. We summarize these questions in the Flow Model of Service Distribution in Figure 5.2. The "what" determines what exactly will flow through the distribution channel (i.e., information, negotiation, and the core and supplementary services). A distribution strategy needs to cover for each of these flows the remaining three questions of how, where, and when. This model is the organizing framework for this chapter, and the following sections describe each of its components. WHAT IS BEING DISTRIBUTED? If you mention distribution, many people are likely to think of moving boxes through physical channels to distributors and retailers for sale to end users. However, in services, there is often nothing to move. Experiences, performances, and solutions are not physically shipped and stored. Meanwhile, informational transactions are increasingly conducted via electronic channels. How, then, does distribution work in a services context? In a typical service sales cycle, distribution embraces three interrelated flows that partially address the question of what is being distributed: Information and promotion flow: This refers to the distribution of information and promotion materials related to the service offer The objective is to get the customer interested in buying the service. Negotiation flow: This is involves reaching an agreement on the service features and configuration as well as the terms of the off er so that a purchase contract can be closed. Often, the objective is to sell the right to use a service (e.g., sell a reservation or a ticket). Product flow: Many services, especially those involving people processing or possession processing, require physical facilities for delivery. Here, distribution strategy requires the development of a network of local sites. For information processing services such as internet banking and distance learning, the product flow can be via electronic channels, employing one or more centralized sites. It is important to distinguish between the distribution of core and supplementary services. Many core services require a physical location, and this severely restricts distribution. For instance, you can only consume Club Med holidays at Club Med Villages, and a live performance of a Broadway show must take place at a theater in Manhattan (until it goes on tour). However, many of the supplementary services can be distributed widely and cost-effectively via other means. Prospective Club Med customers can get information and consultation from a travel agent face-to-face, online, by phone, or by e-mail. Th ey can then use one of these channels to make a booking. Similarly, theater tickets can be purchased through an agency without the need for an advance trip to the physical facility itself.

MARKETING 2018

19th Edition

ISBN:9780357033753

Author:Pride

Publisher:Pride

Chapter14: Marketing Channels And Supply Chain Management

Section14.1: Taza Cultivates Channel Relationships With Chocolate

Problem 1VC

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