Place and distribution
AQA also says:
Spec content: Place (channels of distribution: retailers, wholesalers, telesales); E-commerce and m-commerce.
Students should be able to: be familiar with the different channels of distribution; analyse the appropriateness of each distribution method for a given scenario; analyse the growing importance of e-commerce and m-commerce and how it can extend reach to international markets; identify the benefits and drawbacks of e-commerce and m-commerce.
Place in the Marketing Mix
Place refers to how a product reaches the customer — the distribution channels, logistics, and access points through which it is made available for purchase. The right place strategy ensures the product is available where and when the customer wants it, in the right quantity, at acceptable cost.
Channels of Distribution
A distribution channel is the route a product takes from producer to end customer. The main channels AQA covers are:
| Channel | How it works | Best for | Key consideration |
|---|---|---|---|
| Producer → Customer (direct) | Producer sells directly to consumer — own website, factory shop, market stall | Unique, artisan, or high-margin products; direct relationship with customer | Producer takes full margin but must handle all distribution and customer service |
| Producer → Retailer → Customer | Producer sells to retailers (supermarkets, shops) who sell on to consumers | Mass-market consumer goods; wide geographic reach | Retailers take a margin; producer has less control over display and pricing |
| Producer → Wholesaler → Retailer → Customer | Producer sells large quantities to wholesalers who redistribute to multiple retailers | Reaching small, independent retailers the producer cannot service directly | Two intermediaries take margins; producer receives the lowest price but lowest distribution complexity |
| Telesales | Products sold directly via telephone — inbound (customer calls) or outbound (business calls customer) | Insurance, utilities, B2B services, financial products | High-touch personal selling; increasingly complemented or replaced by online channels |
E-Commerce and M-Commerce
E-commerce is selling via the internet (desktop/laptop). M-commerce (mobile commerce) is buying and selling via mobile devices — smartphones and tablets. M-commerce has grown rapidly as smartphones have become the primary internet access device for most consumers.
| Benefits | Drawbacks |
|---|---|
| Extends reach to national and international markets without physical premises | Requires investment in website, app, payment security, and fulfilment infrastructure |
| Available 24/7 — no staff required for out-of-hours sales | Customers cannot physically inspect products — higher returns rates |
| Lower operating costs than physical retail (no rent, rates, shop-floor staff) | Intense price competition — customers can instantly compare prices across retailers |
| Rich customer data enables targeted marketing and personalisation | Cybersecurity risks — data breaches can damage customer trust and attract regulatory penalties |
| M-commerce enables location-based offers and instant purchase at the point of decision | App development and maintenance adds ongoing cost; poor mobile experience loses sales |
Key Takeaways
- Place is how products reach customers — distribution channels, logistics, and access points.
- Main channels: direct, retailer, wholesaler → retailer, telesales — each involves different cost and control trade-offs.
- More intermediaries = wider reach but lower producer margin and less control.
- E-commerce and m-commerce enable national/international reach at lower cost than physical retail — but require technology investment and carry cybersecurity and returns risks.