Place
Place means how a product reaches the customer — the channel of distribution. A traditional channel is: producer → wholesaler → retailer → consumer. A wholesaler buys in bulk and sells smaller amounts to retailers; a retailer sells directly to the final consumer.
Key idea
A direct channel (producer → consumer), such as selling online through e-commerce, cuts out the middlemen and can lower costs.
Promotion
Promotion is communication that aims to inform, persuade or remind customers so they buy the product.
- Advertising uses paid media such as television, posters or the internet.
- Sales promotion uses short-term offers such as discounts, free gifts or competitions.
Example
Above-the-line promotion uses paid advertising in the media. Below-the-line promotion uses other tools the firm controls, such as sales promotions and direct mail.
Remember
- The best channel depends on the product, the market and cost.
- Promotion must reach the right customers without wasting money.
Place and promotion must fit the product and price so the whole marketing mix works together.