A new entrant plans to launch a smartphone in India. Discuss how the firm should choose between exclusive distribution and selective distribution, and recommend the most suitable strategy.
Answer
Selective distribution is the most suitable for the new smartphone entrant.
The correct answer is Selective distribution is the most suitable for the new smartphone entrant. — Conclude that selective distribution aligns best with the need for extensive reach and cost efficiency for a new smartphone brand.
Step-by-step solution
- Define exclusive distribution: only one or very few retailers get the product, giving high control but limited reach.
- Define selective distribution: the product is sold through a limited but more than one set of retailers, balancing control and coverage.
- Assess market size: India has a vast and heterogeneous market, requiring wide reach.
- Consider cost: Exclusive distribution incurs higher logistics and inventory costs per unit.
- Evaluate brand positioning: Smartphones need high visibility and after‑sale service; selective distribution offers sufficient control while covering many urban and semi‑urban outlets.
- Weigh benefits: Selective distribution provides broader market coverage, lower per‑unit cost, and adequate control over brand image.
- Conclude that selective distribution aligns best with the need for extensive reach and cost efficiency for a new smartphone brand.
Common mistake: Ignoring cost implications and assuming exclusive distribution always gives better brand control.
Concept tested: Distribution strategy selection
Published · How this solution was prepared and checked
← All Marketing Management questions