What is the difference between inclusive distribution and selective distribution strategy?

Intensive distribution, also known as mass distribution is intended for mass-marketing products. Basically, companies opt for this strategy when they want to ensure widespread availability of products.

This distribution strategy works well for consumer durable and FMCG products. Take your favorite brand of chewing gum for example. The product is probably available everywhere you go from drugstores to gas stations – you name it.

Intensive distribution strategy is typically adopted by companies to make products widely available hence products are stocked in a large number of outlets. It’s also an excellent way to boost product awareness. However, because of its incredibly large reach, intensive distribution strategy might not be the most budget-friendly choice for all companies.

2. Extensive Distribution

Extensive distribution strategy is an excellent choice for companies that are comfortable with using multiple channels to reach out to their customers.

It’s often used by companies that want to target as many consumers as possible to achieve maximum market penetration. The main purpose of an extensive distribution strategy is to make consumers aware of a certain product line or product. This is practically the opposite of selective distribution.

Some big brands such as the Coca-Cola Company and Cadbury.

3. Selective Distribution

Selective distribution strategy is perhaps one of the most popular strategies used by high-end brands. It is typically used by brands that want to open up a handful of outlets in particular geographical location.

While this may seem like it would restrict or hamper sales, it helps companies target best-performing outlets. This, in turn, allows companies to spend more time and effort towards training facilities and improving quality.

In turn, all this helps create a more personalized shopping experience for consumers which directly contributes to better sales.

Most luxury goods manufacturers opt for selective distribution such as Dolce & Gabbana.

4. Exclusive Distribution

Now, this strategy truly is exclusive in essence. Exclusive distribution strategy is used by the most – you guessed it, exclusive and prestigious brands out there. Using this strategy, the company aims to maintain maximum control over retailers.

In exclusive distribution, the seller grants selling rights to a single retailer. The most obvious advantage of exclusive distribution is that when professionals focus all their energies on a concentrated area, they are likely to reap better results.

Top examples include designer clothing brands, automobile companies and luxury watch brands such as Rolex.

5. Inclusive Distribution

Inclusive distribution is a type of distribution strategy that is typically used by low-income FMGC companies to target low-income micro enterprises.

While inclusive distribution has a potential to reap brilliant results, it involves an extensive process. For instance, companies will have to start by conducting thorough market research. After that, they might have to figure out a way to adapt their business model in accordance with area’s social and cultural values.

The upcoming discussion will update you about the difference between intensive, selective and exclusive distribution.

Difference # Intensive Distribution:

It is a policy where a manufacture seeks to use as many outlets as possible, in as many places as possible. Such a method is known as ‘maximum expansion’. Such methods are usually adopted in the case of convenience goods.

When goods and services are sold through almost all available outlets, it may be said that the producer has adopted a strategy of intensive distribution. In case of all branded convenience items, intensive distribution is a necessity as buyers will not have to spend much effort in buying a particular brand.

Difference # Selective Distribution:

A manufacturer selects a limited number of wholesalers or retailers and works closely with them to further the sale of his products. This method can be used for any type of products, even with convenience goods.

This policy makes it necessary on the part of the manufacturer to select the best distributors available, concentrate efforts on them and thus obtain a greater selling effort for his products.

Generally speaking, in case of goods which carry a higher unit price and which are not purchased quite frequently, selective method is found quite suitable. Goods which require ‘After-Sales Service’ are often sold through this method.

Difference # Exclusive Distribution:

It is the practice of selecting and allotting a distributor an exclusive area of sales called ‘Territory’. There is an exclusive selling agreement. The distributor often agrees not to handle or deal in any competing product. So, there is also an exclusive dealing agreement.

The exclusive distributor is protected from competitors in the area allotted as well as against any price cuts or mark-downs. The manufacturer can have some idea of expected amount of business and can therefore plan his production accordingly.

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