Marketing Mix: Place

The "Place" component of the marketing mix is mainly about distribution. It is important to provide the product at the right "place", which is convenient for consumers to access. With regard to the recent development of the Internet being the distribution channel as well as taking into account the age and shopping behavior of Ambro's main target group, it seems very reasonable to market their product online.

Distribution channels
Ambro currently only sells their product at their own website. This seems to be a cost-effective and suitable strategy for the moment. The main benefit of internet-based distribution according to Olsen (1998) are the following:

• Drive revenues up by extending the company's reach to broader, more global markets
• Reduce costs by bypassing traditional distribution channels by avoiding commissions, and lowering transaction fees 
• Enhance customer experience by providing more and better information with multimedia.

A major disadvantage of online sales is the fact that the customer lose face to face contact with the product and the value provider. However, we have found that Americans have an increased desire to order items online. Therefore, it can be concluded that the average American consider the benefits of internet-based distribution for retailers to be significantly higher than its costs.

In the longer term, Ambro wishes to expand to larger retail websites online. These websites will have the capacity to facilitate to the increased demand for Ambro at that point of time. Potential websites to look at are Amazon, AmericaGrocer and Walmart.

As for the retail stores, Ambro would receive substantial in store promotion if it was present in these traditional brick and mortar stores. However, the current margins retailers charge are too high. This will drive up Ambro's retail price, placing the product out of financial reach for most of the US consumers. Driving down Ambro's production costs should be achieved before considering such a move to the retail stores.

Sources:

• Olsen, M.D., et al, (1998), 'The internet as a distribution channel', Cornell Hospitality Quarterly,  vol. 39 no. 4 42-54
• Delivering Services via Internet: New Distribution Channel for Traditional Services; Zagreb International Review of Economics and Business, 2004, vol. 7, issue Special Conference Issue, pages 141-152