Business – 3.3 The marketing mix – Place (distribution) | e-Consult
3.3 The marketing mix – Place (distribution) (1 questions)
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Cost Structure:
- Variable costs per unit fall as e‑commerce eliminates many fixed costs associated with physical storefronts (rent, utilities, staffing).
- However, new costs arise, such as website maintenance, digital marketing, and last‑mile delivery logistics.
Market Reach:
- E‑commerce removes geographical barriers, enabling retailers to access national or global markets without opening new stores.
- Traditional retailers may lose local market share as consumers shift to online alternatives.
Competitive Dynamics:
- Lower entry barriers increase competition from pure‑play online firms and niche specialists.
- Physical retailers must differentiate through experiential services, immediate product availability, and integrated click‑and‑collect options.
Overall, e‑commerce pressures traditional distribution to become more flexible, cost‑efficient, and customer‑centred, often leading to hybrid models that blend digital and physical strengths.