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Unlock This CourseIn today's digital world, businesses have more ways than ever to get their products to customers. One of the most important developments in recent years has been the rise of e-tailers - online retailers that sell products through the internet. Understanding how to use e-tailers as part of your distribution strategy is crucial for modern businesses.
E-tailers have revolutionised how we shop and how businesses reach customers. From Amazon to ASOS, these digital platforms have become essential parts of the marketing mix's 'Place' element.
Key Definitions:
E-tailers operate entirely online, using websites and mobile apps to showcase products, process orders and manage customer relationships. Unlike traditional shops, they don't need physical stores, which allows them to reach customers anywhere with internet access.
Not all e-tailers are the same. Understanding the different types helps businesses choose the right distribution partners for their products.
E-tailers can be grouped into several categories, each offering different benefits and challenges for businesses looking to distribute their products online.
Huge platforms like Amazon and eBay that sell almost everything. They have millions of customers but lots of competition between sellers.
Focus on specific product categories like ASOS for fashion or Currys for electronics. They understand their market really well.
Companies selling directly through their own websites, like Nike.com or Apple.com. They control the entire customer experience.
Using e-tailers as distribution channels offers many benefits for businesses, especially smaller companies that might struggle to reach customers through traditional retail.
E-tailers can sell to customers worldwide, breaking down geographical barriers. A small UK business can easily sell to customers in Australia or America through platforms like Amazon.
No need for expensive shop rent, fewer staff needed and reduced storage costs. This means businesses can offer competitive prices whilst maintaining good profit margins.
Additional advantages include:
Despite the benefits, e-tailer distribution also presents significant challenges that businesses must carefully consider.
With millions of products online, standing out is extremely difficult. Price wars are common and customer loyalty can be low when alternatives are just a click away.
Other significant challenges:
Gymshark, a UK fitness clothing brand, started by selling through their own website and social media. They later expanded to major e-tailers like ASOS and Amazon. This multi-channel approach helped them grow from a small startup to a billion-pound company. They maintained their brand identity whilst reaching new customers through established e-tailer platforms. Their success shows how combining direct sales with e-tailer partnerships can be highly effective.
Successful businesses don't just pick any e-tailer - they carefully choose platforms that match their products, target customers and business goals.
When selecting e-tailers for distribution, businesses must evaluate several factors to ensure the best fit for their products and objectives.
Different e-tailers attract different customers. Etsy appeals to people wanting handmade items, whilst Amazon attracts bargain hunters.
Compare commission rates, listing fees and advertising costs across different platforms to find the most profitable option.
Some e-tailers offer warehousing, customer service and marketing support, whilst others just provide the selling platform.
Multi-channel Approach: Many successful businesses use multiple e-tailers simultaneously. This spreads risk and reaches different customer segments, but requires more management and coordination.
The growth of e-tailers has dramatically changed the retail landscape, affecting how traditional shops operate and compete.
E-tailers have forced traditional retailers to adapt or risk becoming irrelevant. Many high street shops have closed, whilst others have developed their own online presence to compete.
Smart retailers now combine physical stores with online sales, offering services like click-and-collect, where customers order online but pick up in-store. This gives customers flexibility whilst maintaining the benefits of physical locations.
John Lewis successfully adapted to e-tailer competition by developing a strong online presence whilst maintaining their physical stores. They offer click-and-collect, same-day delivery in some areas and use their stores as distribution centres. Their "Never Knowingly Undersold" price promise applies online too, helping them compete with pure e-tailers. This shows how traditional retailers can evolve to thrive in the digital age.
E-tailer distribution continues to evolve rapidly, with new technologies and changing customer expectations driving innovation.
Understanding future trends helps businesses prepare for tomorrow's e-tailer landscape and make smart distribution decisions today.
Key developments include:
E-tailers have become an essential part of modern distribution strategies. They offer unprecedented reach and convenience but also present new challenges around competition and control. Successful businesses carefully choose their e-tailer partners, often using multiple channels to maximise their market reach whilst maintaining their brand identity.
As technology continues to advance, e-tailer distribution will keep evolving. Businesses that understand these changes and adapt their strategies accordingly will be best positioned for future success in the digital marketplace.