Place - Direct Selling Flashcards
(17 cards)
What is Direct Selling?
Direct selling means selling directly to the consumer from the manufacturer. Shortest channel of distribution and means there are less ‘middle men’ taking a cut of the profits.
What are the methods of direct selling?
- E-commerce
- Mail Order
- Direct Mail
- Personal Selling
- Shopping Channels
What is E-commerce?
A business sells its products using the internet.
Example: ASOS
What are the advantages of E-commerce?
- Customers in the global market can be reached 24/7.
- An entire range can be shown online.
- Online discounts can be offered to attract customers.
- Products information and customer comments can sway purchasing decisions.
What are the disadvantages of E-commerce?
- It can take a lot of time and expense to design attractive, high-quality websites.
- Customer might be wary of providing their personal details online.
- Customers need to have access to the internet.
- Customers need to wait for products to arrive and may have to pay delivery cost.
What is a Mail Order?
A business sells its products using a catalogue, which is usually sent directly to the customer.
Example: MandM Direct
What are the advantages of Mail Order?
- Credit facilities are often offered to the customers.
- Customers can browse for products and place orders from, at a time that suits them.
- Mail-order-only companies save money on staffing and store costs.
What are the disadvantages of Mail Order?
- Glossy catalogues can be expensive to produce.
- Producing catalogues is not environmentally friendly and may not meet CSR aims.
- A level of bad debt might be incurred.
What is Direct Mail?
A business posts letters, leaflets and brochures directly to the customer.
What are the advantages of Direct Mail?
- Specific market segments can be targeted, e.g. by inserting supermarket recipe cards inside cookery magazines.
- A wide geographical area can be targeted by placing leaflets inside newspapers and magazines.
What are the disadvantages of Direct Mail?
- Customers can perceive this as ‘junk mail’ and simply throw it away.
- Customer mailing list can quickly become out of date, meaning a business may target the wrong people and waste money.
What is Personal Selling?
A salesperson sells products directly to the customer, often by going ‘door-to-door’ or over the phone (telesales).
What are the advantages of Personal Selling?
- Allows a demonstration or explanation of the product to be given.
- Feedback on products can be gathered from customers.
What are the disadvantages of Personal Selling?
- Customers can find this type of selling a nuisance and may not be keen to listen.
- Staffing costs and commission make this method expensive and increasingly unpopular with businesses.
What are Shopping Channels?
A business sells products on the TV using dedicated shopping channels.
Example: QVC
What are the advantages of Shopping Channels?
- Customers can see the product being modelled and demonstrated.
- Customers can be encouraged to buy on impulse due to short-term bargain prices.
What are the disadvantages of Shopping Channels?
- Customers need to switch on to the channel before they can be targeted.
- Customers need to wait for products to arrive and may have to pay delivery costs.
