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Reply from Kevin Hughes

Discussion Post: Place

Kevin Hughes

School of Business, Liberty University

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Author Note

Kevin Hughes

I have no known conflict of interest to disclose.

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Place, also referred to as Placement, is one of the 4 Ps of Marketing, which consist of Product, Price, Place, and Promotion. Place takes a deeper dive into how a business can get the product from its facilities to the customer. In short, Place involves analyzing these methods to ensure the most practical and efficient delivery while maintaining high customer satisfaction and generating a profit. Below, Place will be broken down into four categories: Marketing Channel strategy, distribution retailers, the internet, and the supply chain.

Marketing Channel Strategy

Within Place, firms must focus on the marketing channel. The marketing channel outlines the organizations and steps involved in getting products to customers. This streamlines who will sell the products, how customers can purchase them, and who will assist the customer from start to delivery. Typically, marketing channels can be direct to customers, wholesalers, retailers, and brokers. The goal of the marketing channel is to ensure a positive customer experience from start to finish while maintaining a solid profit. Because there are multiple channels, this can open the door to pricing inconsistencies among the channels, which can essentially offer an advantage to one method over the other. Manufacturers are witnessing the pricing disparity firsthand, as firms that have been utilizing internet-based targeting have been cutting retailer sales while boosting online sales, ultimately allowing pockets of higher pricing due to higher demand in the channel (Jiang et al., 2024). Manufacturers have been taking advantage of this by utilizing the direct-to-customer method from the actual website, such as Nike. Nike sends out targeted ads reflecting low prices, which boosts sales for them; however, retailers such as Champs may face a shortage of customers walking in to purchase that same shoe due to the lower online price.

Distribution Retailers

Distribution retailers are retailers that not only sell products but also distribute them in-house. Distribution retailers focus on attracting customers and providing a smooth transition by offering services such as product demonstrations, brand representation, and return processing. Within the distribution realm, there are intensive, selective, and exclusive distribution. Intensive distribution involves firms that make their products available everywhere, such as Pepsi, and the overall goal is maximum convenience. Selective distribution involves products offered only through certain retailers, such as Sony, which gives the distributor the ability to control the brand. Exclusive distribution involves firms that limit the retailers, such as Ferrari, which ultimately gives the brand a sense of exclusivity. Distribution retailers have begun to shift the focus of social media advertising to promote brands and the methods by which clients can shop for products (Wang et al., 2024). Keeping this in mind allows distribution retailers to promote products in ways that influence specific channel shopping, as well as to control exclusivity, balance the brand, and maximize product availability.

The Internet

The internet has enabled more strategic placement by offering faster shipping, mobile ordering, immediate access to inventory, and the ability to buy online and pick up in-store. Utilizing the internet allows for the ability to attract more clients while limiting physical locations, which ultimately saves money for the firm. This approach opens the door for multiple ways for firms to collect customers, such as mobile apps, websites, and social media sites. The internet also opens the door to using the buy online, pick up in-store method, which allows customers to stop by the store and potentially purchase more than they originally came in for. The use of the internet also allows for more customers, as they can reach out to clients globally, and creates lower operating costs due to not having to utilize brick and mortar. Using the internet also enables personalized marketing to increase demand for certain products.

Supply Chain

The foundation of Place ultimately starts with the supply chain. Having strong marketing does not work if the supply chain is not efficient. A faulty supply chain can lead to incorrect or delayed inventory, ultimately causing clients to shop for other brands. The goal of the supply chain is to enable faster delivery, improved customer service, higher inventory turnover, and greater supply chain resilience. Due to technological advances, firms can use AI to improve demand forecasting and provide greater inventory visibility, enabling better communication. Utilizing the internet as a complement to brick-and-mortar allows firms to move leftover inventory to sites that can effectively sell it (Guo & Keskin, 2023). Taking this into consideration, firms can use the internet/technology to truly optimize inventory, create ease in transportation planning, and implement warehouse automation. The supply chain must be built to be resilient against competition and changes in market conditions. This then allows for a better customer experience due to improved product availability, lower inventory costs, enhanced delivery speeds, and lower product costs for the client.

Biblical Integration

A firm must ensure that its placement strategy is carefully designed to keep inventory up to date, maintain an effective supply chain, have a plan with retailers, and execute effective marketing. The underlying theme is effective planning. Proverbs 21:5 reminds one that the plans of the diligent lead to profit, while no plan leads to poverty. A successful firm must effectively plan to ensure a smooth process for clients and retailers alike. Colossians 3:23 states that whatever you do, do it with all your heart in the name of the Lord. Keeping this in mind, firms must remember that anything they do is a direct representation of the Lord, and anything worth doing is worth doing in his name and honor. The Lord teaches people to plan and be a blessing to others with the gifts he has given them. The goal is to add value to their client’s lives, and in return they can reap the rewards of their labor.

References

Guo, J., & Keskin, B. B. (2023). Designing a centralized distribution system for omni‐channel retailing. Production and Operations Management, 32(6), 1724–1742. https://doi.org/10.1111/poms.13936

Jiang, Z., Dan, W., & Huini, Z. (2024). Direct channel or distribution channel? The role of internet-based targeted advertising with vertical differentiation in distinct channels. Sage Open, 14(4). https://doi.org/10.1177/21582440241286727

New International Version Bible. (2011). Zondervan

Wang, Y., Mei, S., Xu, R., Yang, D., & Zhong, W. (2023). Channel Competition in omni‐channel supply chain considering social media advertising. Managerial and Decision Economics, 44(6), 3354–3366. https://doi.org/10.1002/mde.3883