Limited distribution is an agreement with the main assumption that manufacturer sells products, services, materials etc. to only one or limited number of buyers . Another definition explains, it is marketing strategy when independent specialists and chains are encouraged to promote special, unique products or private label products. It leads toexclusive dealing . Burnett J. J. describes that limited distribution strategy together with support of promotional mix would bring quite unpredictable results. It might be surprisingly beneficial, especially when there are other marketing mix factors existing and there is big promotional effort such as personal selling or mass selling .
Example of limited distribution item
Contact lenses is example of the product that limited distribution strategy was used:
- It was expected that prices of such products would be different (higher) in comparison with national branded types, however both private label and limited distribution versions were not much different from products delivered to market with other marketing strategy,
- For limited distribution, very little consumer promotional activities and advertising was created,
- Product was firstly promoted to professionals who later on promoted it to customers and sell on the market. It caused increased competition among sellers. For example, there might be online outlet, when prices of such items are very attractive. In such case, other channels would need to invest in advertising to be more competitive on the product and attract the customer.
- Van Bael & Bellis, (2010), p. 235
- United States. Federal Trade Commission, (2005), p. 32
- Burnett J. J., (1984), p. 144
- United States. Federal Trade Commission, (2005), p. 17-32
- Burnett J. J., (1984), Promotion Management: A Strategic Approach, West Publishing Company
- D’Arma A., (2011), Content Aggregation in the Age of Online Video: An Analysis of the Impact of Internet Distribution on the Television Business in "Journal of Media Business Studies Volume 8, 2011 - Issue 3"
- Daft J., Albers S., (2014), An empirical analysis of airline business model convergence, Working Paper, No. 112, University of Cologne, Department of Business Policy and Logistics, Cologne
- Jain S. C., (2000), Distribution Strategies in Marketing Planning & Strategy, SWC-Marketing Series, South-Western College Pub
- Picard R. G., (2005), Unique Characteristics and Business Dynamics of Media Products in "Journal of Media Business Studies Volume 2, 2005 - Issue 2"
- Ryan M. D., Hearn G. N., (2010), Next generation ‘filmmaking’ : new markets, new methods and new business models., Media International Australia, Incorporating Culture and Policy
- United States. Federal Trade Commission, (2005), The Strength of Competition in the Sale of Rx Contact Lenses: An FTC Study, DIANE Publishing
- Van Bael & Bellis, (2010), Competition Law of the European Community, Wolters Kluwer Law & Business
Author: Katarzyna Żurek