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CHAPTER 7
STRATEGIES FOR INSURANCE MARKETING - II
CHAPTER INTRODUCTION
LEARNING OUTCOMES
A. The Distribution Channel
B. Insurance Intermediaries
C. Promotion
D. People
A. The Distribution Channel
a) The Purpose of Distribution
After a product is manufactured, it has to reach the customer. It has to be ensured that the product is
available to the customer when he wants to buy it. It should be available at a place where it is
convenient for him to buy. Distribution is the process by which the product is moved from the place
where it was manufactured to the place where the customer can buy it. Distribution adds `place utility'
to the product.
In the process of distribution, the product will be handled by many persons. The persons handling the
movement are called intermediaries in the distribution chain. The route taken by the product is the
distribution channel. The intermediaries are like way-side stations in the channel. The last person in the
chain is the retailer, where the goods remain till the customer buys.
(b) Wholesalers and Stockists
A wholesaler is an important part of the distribution chain. His function is to service the needs of the
retailer. He would hold stocks in bulk and distribute them to the retailers as per their requirements,
supporting them with information and credit, if necessary. Wholesalers may also take back unsold goods
to be diverted to other markets where the demand may be more.
In addition to the wholesaler, there may be stockists, whose function is to hold stocks and release them
to designated persons. Stockists and wholesalers may or may not have exclusive territorial rights. They
may be expected to arrange for marketing activities in support of the products, like transportation down
the channel, local advertisements and promotions, local market research, etc. The arrangements may or
may not require the intermediary to pay and assume the title to the goods. Sometimes, the retailer may
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