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Accountancy Business
and Management (ABM)
Principles of
Marketing
Quarter 4 – Module 3
Product Distribution and Promotional
Tools
ABM- GRADE 11 Principles of Marketing
Alternative Delivery Mode
4th Quarter – Module 3: Product Distribution and Promotional Tools
First Edition, 2021

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Writers: MA. THERESA M. BALTAZAR
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Office Address: Gov. Noble St., Brgy. Guadalupe Nuevo

City of Makati, Metropolitan Manila, Philippines 1212

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E-mail Address: makati.city@deped.gov.ph

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 What I Need to Know
This module was designed and written with you in mind. It is here to help you
master the 3rd Product Distribution and Promotional Tools. The scope of this
module permits it to be used in many different learning situations. The language used
recognizes the diverse vocabulary level of students. The lessons are arranged to follow
the standard sequence of the course. But the order in which you read them can be
changed to correspond with the textbook you are now using.
Content Standard
The learners demonstrate an understanding of the essence of the new product
development, pricing, placing (distribution), and promoting a product or service.
Performance Standard
The learners shall be able to design a new product or service, decide types of pricing
approach, and choose distribution methods and promotion tools that respond to
market trends.
Most Essential Learning Competencies

1. Discuss the structure of distribution channels, their functions, and the nature of supply
chain management;

2. Define and identify relevant promotional tools, namely, advertising, sales promotion,
personal selling, public relations, and direct marketing to create awareness and persuade
the target market to buy the product or patronize the service.

What I Know
Activity 1.

Before you proceed, let us try to recall what you have known about the lesson. Write TRUE if
the statement is correct and FALSE if wrong:

1. Place or distribution is about efficiently moving products from producers to

consumers.
2. Distribution channels should not be burdened with other tasks such as
gathering customer information or promoting products.
3. Distribution may take care of shipping and delivery if they have the logistics for
doing this.
4. A sales force is a kind of distribution system.
5. Your bargaining power determines how much you can get your distributors to
do for you.
6. Exclusive distribution means giving exclusivity to a wide range of distributors
so that products can be distributed as widely as possible.
7. Retailing is not about real estate.
8. The promotions mix consists of above-the-line, below-the-line and through-the-
line promotions.
9. Advertising is generally associated with one-is-to-many, one-way
communications Intangibles, such as a concert or a delivery service, are not
products.
10. To be successful, sales promotions should have limited time frames, high
budgets, and ease of participation It is advisable for products to appeal to all tastes
and preferences.

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 Product Distribution and
Lesson 3
Promotional Tools

What’s In

DID YOU KNOW?

To communicate well, companies often hire advertising agencies to develop effective
ads, sales promotion specialists to design sales-incentive programs, direct-marketing
specialists to develop databases and interact with customers and prospects by mail and
telephone, and public relations firms to develop corporate images. They train their salespeople
to be friendly, helpful and persuasive. For most companies, the question is not whether to
communicate, but how much to spend and in what ways. All their communications efforts
must be blended into a consistent and coordinated communications program.

What’s New

Name three examples of commercials or advertisements on television.

Does this commercial attract your attention? What is the advertisement/commercial
trying to sell or promote? If you were the buyer of that certain products, how would
you acquire that product you choose?

What is It

Product Distribution Channels

The product type is also a major consideration in deciding the type of
distribution channel or intermediary. Mass market or fast-moving consumer goods
may require intensive distribution, while products like expensive fragrances may
necessitate only selective, if not exclusive, distribution.
What is a Supply Chain?
A supply chain is the network of all individuals, organizations, resources, activities,
and technology involved in the creation and sale of the product. The chain starts from
the delivery of materials from the supplier to the manufacturer to the eventual delivery
of the finished products to its user. The supply chain segment involved in the delivery
of the product from the manufacturer to the consumer is known as the distribution
channel.

Product Distribution Types

1. Exclusive distribution- distribution is limited to a select number of dealers,
usually one or a few. The objective of exclusive distribution is to have more control
over how a particular brand is priced, displayed, and promoted.

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2. Intensive distribution- used mostly by fast-moving consumer goods and
convenience goods, involves making a product available in as many retail outlets as
possible. Some examples of products sold via intensive distribution are bottled
drinking water, candies, and snack foods, etc.
3. Selective distribution- positioned between exclusive and intensive distribution.
It involves the use of more than one but not as many dealers as in intensive
distribution. This allows adequate manufacturer control over retail prices, displays
and promotions.

Wholesaling- the sale of goods for resale. Product distribution function. Wholesaling
is an important product distribution function. Without wholesalers, product
manufacturers would have to deliver goods directly to retailers.
Retailing- is defined as the sale of goods/services to the final customer for his
consumption. Typical examples of retailing establishments are drug stores, sari-sari
stores, restaurants, movie houses, convenience stores, and supermarkets.

Setting the promotion mix

The concept of integrated marketing communications suggests that it must blend the
promotion tools carefully into a coordinated promotion mix. But how does the
company determine what mix of promotion tools it will use? Companies are always
looking for ways to improve promotion by replacing one promotion tool with another
that will do the same job more economically.
Advertising- is defined as any paid and public presentation of products, services, or
ideas, by an identified sponsor through a medium. The most common objectives of
advertising are:
• To build awareness
• To inform
• To persuade
• To remind
Brand awareness- is the extent to which consumers are familiar with the
distinctive qualities or image of a particular brand of goods or services.

Types of Media and Techniques Used in Advertising

Traditional Media and Techniques:
1. Radio
2. Newspaper
3. Magazine
4. Television
Alternative Media and Techniques:
1. Cinema- large number of cinema houses and movie theaters have sprouted in major
cities, particularly in Metro Manila.
2. Billboard- The relatively low cost but high exposure to heavy traffic along major
thoroughfares has led to the popularity of billboard advertisements. Despite increasing
rental costs and the imposition of government regulations on this type of outdoor
advertising, billboards continue to thrive and have technologically evolved from
traditional billboards to the use of light-emitting-diodes (LED).
3. Websites- Almost all legitimate companies have developed websites that customers
can access for product information and services.
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4. Social Networking Sites- Many social media users all over the world has led to the
popularity of social networking sites as media for advertising.
5. Product Placement- Product placement is an advertising technique used by
companies to promote products subtly through a nontraditional advertising technique,
e. g. appearances on film, television, or other media.
6. E-mail Advertising- There are currently 2.2 billion e-mail users worldwide,
transmitting 144 billion e-mails daily.
7. Transit Advertising- Buses and jeepneys in the Philippines ply the same route every
day.
8. Online Ads- Out of 2.4 billion Internet users worldwide, 1.1 billion are from Asia.
These figures have led to the popularity of Internet advertising, which permits target
marketing using cookies generated by a web page server.
9. Direct Response Advertising- Used extensively on television during specific periods
of the day and usually presented in telemarketing programs, direct response
advertising mostly showcases products not available through conventional retailers.
10. Point-of-Purchase, Signs, Posters, and Leaflets- These are relatively inexpensive
ways to advertise and promote a product.
⚫ Promotions
Promotions are activities or a series of activities, usually short-term, that are
intended to boost the sales of a product or service. These are actions a company
can take to stimulate customers to buy immediately than later.

Three types of Promotions:

1.Trade promotions- Trade promotions are intended for marketing

intermediaries such as retailers. The purpose of trade promotions is to
encourage the intermediaries to increase purchases, to stock a particular
product, to accelerate purchases or payments for purchases, or to extend
preference towards a particular brand. Some examples of trade promotions are
10+1 (if a retailer orders ten cases of a product, the manufacturer delivers 11
cases but does not charge for the extra case), giving retailers free store signages
to carry a specific product brand, and contests among participating retailers.

2. Consumer promotions- Consumer promotions are intended for consumers.

The purpose of consumer promotions is to induce product trials, encourage
brand switching, or reward consumer patronage. Examples of consumer
promotions include the distribution of product samples, consumer contests,
sweepstakes, coupons, and raffles.
3. Sales promotion - Sales promotion includes a wide assortment of tools –
coupons, contests, price reductions, premium offers, free goods, and others – all
of which have many unique qualities: They attract consumer attention and
provide information that may lead to a purchase. They offer strong incentives
to purchase by providing inducements or contributions that give additional
value to consumers. Moreover, sales promotions invite and reward quick
response. Whereas advertising says, ‘buy our product’, sales promotion offers
incentives to consumers to ‘buy it now’. Companies use sales promotion tools to
create a stronger and quicker response

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 Personal Selling- Personal selling occurs when an individual salesperson sells a
product, service, or solution to a client. Products and services most promoted and sold
through personal selling are institutional products such as equipment, recurring
supplies, motor vehicles, homes, financial services, and unsought goods such as life
insurance and memorial plans. With personal selling the buyer usually feels a greater
need to listen and respond, even if the response is a polite ‘no thank you’. These unique
qualities come at a cost, however. A sales force requires a longer-term commitment
than does advertising – advertising can be turned on and off, but sales force size is
harder to change. Personal selling is also the company’s most expensive promotion
tool.
Public Relations- Public relations is creating and maintaining the goodwill of an
organization’s various publics (customers, employees, inventors, suppliers, etc.)
through publicity and other nonpaid forms of communication. A fast-food chain, for
example, has a toy-giving program for indigent children. Other companies support one
or more charities such the Hospicio de San Jose, Tahanang Walang Hagdanan, Inc.,
and have given valuable logistical and financial support during natural calamities, e.
g. typhoon.
Publicity- Publicity is a communication written and produced by public relations
professionals intended to create a favorable public image for a client. Publicity usually
takes the form of text, audio and video news releases about an individual or
organization. They are distributed to newspapers, magazines, radio and television
stations, Internet sites, and other forms of media. Publicity is often published or
circulated by third-party entities such as magazines and newspapers, it has a higher
level of credibility as compared to advertising.

What’s More
Activity 1.

(a). How are the marketing communications at the selected websites different from
those found in traditional advertising media? Compare and critique the online versus
traditional (offline) forms of marketing communication. Assess the advantages and
disadvantages of each form. Which of the two forms is more effective? Explain

What I Have Learned

Activity 2. Recall any advertisement that you think is controversial or that creates a
wrong perception of their products/services. Then answer the following question:

1. What is the advertisement trying to sell or promote? Who is the target market?
2. Why did you choose this advertisement?
3. Why do you think that this is controversial?

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 What I Can Do
Activity 3. Write/answer in a separate piece of paper:

Michael Jordan, Tiger Woods, Jeff Gordon and numerous well-known athletes
have had a huge impact on advertising and endorsements. Explain the positive and
negative consequences of using celebrity sports figures to promote a company’s
products or services. What impact does the use of sports celebrity endorsers have on
the average person? Is this different from the impact of other types of celebrity
endorsers?

Assessment
Carefully read the questions and encircle the correct answer.
1. What are the three general ways on how a product can be distributed using
marketing intermediaries?
A. exclusive, intensive, and selective distribution
B. supplies, customers, and competitors distribution
C. competitors, product, and customers distribution
D. customers, intensive, and selective distribution

2. Which of the following is NOT a key function of wholesalers?

A. build awareness C. assortment-building
B. bulk-breaking D. product storage and transportation

3. What are the two most crucial distribution intermediaries, most especially in
providing place utility for a product’s customers?
A. supplier and competitor
B. wholesalers and retailers
C. storage and transportation
D. price and promotion
4. What do you call the important product distribution function in delivering goods
directly to retailers?
A. product storage C. wholesaling
B. retailing D. financing

5. Which of the following is NOT an example retailing establishments?

A. drug store C. convenience store
B. financing establishment D. movie houses

6. What do you call the paid and public presentation of products, services, or ideas,
by an identified sponsor through a medium?
A. promotions C. publicity
B. advertising D. public selling

7. Which of the following steps in advertising campaigns identify the types of

message, the medium to be used, and the celebrity endorsers to be selected?
A. selecting media
B. identifying the target market
C. establishing advertising objectives
D. determining advertising message

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8. What do you call the extent to which consumers are familiar with the distinctive
qualities or image of a particular brand of goods or services?
A. brand awareness C. advertising campaigns
B. choice awareness D. learning awareness
9. What type of traditional media is a viable advertising vehicle in the Philippines
since 1922 as the most accessible media?
. A. magazine C. radio
B. newspaper D. television

10. What type of alternative media is considered the first motion picture that
appeared in the Philippines in 1904?
A. television C. social networking
B. website D. cinema

Additional Activities

1. Prepare a report on the advertising rates charged by any of the following:

a. radio
b. television
c. newspapers
d. magazines

References
Principles of Marketing by Real C. So and Oscar Torres
Principles of Marketing Forth European Edition by Philip Kotler
and Veronica Wong

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Para sa mga Katanungan o puna, sumulat o tumawag sa:

Department of Education - School Division Office of Makati City

Gov. Noble St., Brgy. Guadalupe Nuevo

City of Makati, Metropolitan Manila, Philippines 1212

Telefax: (632) 8882-5861 / 8882-5862

Email Address: makati.city@deped.gov.ph