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36-618: Today, Free People sells their line in 1,400 specialty stores worldwide. The brand is distributed globally via direct channels , including the Free People Global site, and Free People UK site, as well as specialty clothing boutiques, department stores , and the brand’s freestanding retail locations in the U.S. and Canada. In the early 1970s, Richard Hayne opened a store in West Philadelphia , Pennsylvania , with his first wife, Judy Wicks, and named it Free People. His store attracted

72-429: A diverse range of activities and disciplines including detailed logistics , transportation , warehousing, storage, inventory management as well as channel management, including selection of channel members and rewarding distributors. Before designing a distribution system, the supplier needs to determine what distribution channel to achieve in broad terms. The approach to distributing products or services depends on

108-717: A head office in Singapore which can be used by manufacturers outside the region to increase their regional market penetration and grow sales. Channel-switching (not to be confused with zapping or channel surfing on TV) is the action of consumers switching from one type of channel intermediary to a different type of intermediary for their purchases. Examples include switching from brick-and-mortar stores to online catalogues and e-commerce providers; switching from grocery stores to convenience stores or switching from top tier department stores to mass market discount outlets. A number of factors have led to an increase in channel switching behaviour;

144-480: A major trigger for disintermediation in some industries. Certain types of traditional intermediaries are dropping by the wayside. Distribution (economics) In economics , distribution is the way total output , income, or wealth is distributed among individuals or among the factors of production (such as labour , land , and capital ). In general theory and in for example the U.S. National Income and Product Accounts , each unit of output corresponds to

180-478: A number of factors including the type of product, especially perishability ; the market served; the geographic scope of operations and the firm's overall mission and vision. The process of setting out a broad statement of the aims and objectives of a distribution channel is a strategic level decision. Strategically, there are three approaches to distribution: Summary of strategic approaches to distribution In consumer markets, another key strategic level decision

216-546: A powerful channel member may coordinate the interests of the channel for personal gain. Territories are often seen as a source of conflict, sometimes because boundaries are only loosely defined. American building materials supplier Johns Manville noted in the years before the US entered World War II that distributors needed support in a range of practical areas if they were going to be successful in connecting with housing developers, and instituted "Housing Guilds" which brought together

252-428: A risk leading distributors to move their business to other supply lines. Channel conflict can arise when one intermediary's actions prevent another intermediary from achieving their objectives. Vertical channel conflict occurs between the levels within a channel, and horizontal channel conflict occurs between intermediaries at the same level within a channel. Channel conflict is a perennial problem. There are risks that

288-412: A single organization uses a variety of different channels to reach its markets, this is known as a multi-channel distribution network. In addition, online retailing or e-commerce is leading to disintermediation , the removal of intermediaries from a supply chain. Retailing via smartphone or m-commerce is also a growth area. The firm's marketing department needs to design the most suitable channels for

324-492: A unit of income. One use of national accounts is for classifying factor incomes and measuring their respective shares, as in national Income . But, where focus is on income of persons or households , adjustments to the national accounts or other data sources are frequently used. Here, interest is often on the fraction of income going to the top (or bottom) x percent of households, the next x percent, and so forth (defined by equally spaced cut points, say quintiles ), and on

360-423: A way of representing normative economics at a high level of generality. In neoclassical economics , the supply and demand of each factor of production interact in factor markets to determine equilibrium output, income, and the income distribution. Factor demand in turn incorporates the marginal-productivity relationship of that factor in the output market. Analysis applies to not only capital and land but

396-464: Is also currently chief executive of Free People. In the first six months of 2013, sales topped $ 180 million, an increase over the $ 135 million in 2012; the company's use of big data and social commerce were factors in its sales growth. Free People has a total of 136 free standing boutiques across the United States and Canada. The company also operates wholesale a pop-up showroom located in

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432-564: Is co-created by all the players within the distribution chain, including the value created by customers themselves. This emphasis on value-creation is contributing to a change in terminology surrounding distribution processes; "distribution networks" are often termed value-chains while "distribution centers" are often termed customer fulfillment centers . For example, the retail giant Amazon , which utilizes both direct online distribution alongside bricks and mortar stores, now calls its distribution centers "customer fulfillment centers". Although

468-481: Is known as a zero-level distribution system or direct marketing . A level one (sometimes called one-tier ) channel has a single intermediary. A level two (alternatively a two-tier ) channel has two intermediaries, and so on. This flow is typically represented as being manufacturer to retailer to consumer, but may involve other types of intermediaries. In practice, distribution systems for perishable goods tend to be shorter - direct or single intermediary, because of

504-411: Is the process of making a product or service available for the consumer or business user who needs it, and a distributor is a business involved in the distribution stage of the value chain . Distribution can be done directly by the producer or service provider or by using indirect channels with distributors or intermediaries . Distribution (or place ) is one of the four elements of the marketing mix :

540-449: Is whether to use a push or pull strategy. In a push strategy , the marketer uses intensive advertising and incentives aimed at distributors, especially retailers and wholesalers, with the expectation that they will stock the product or brand, and that consumers will purchase it when they see it in stores. In contrast, in a pull strategy , the marketer promotes the product directly to consumers hoping that they will pressure retailers to stock

576-496: The Insurance Distribution Directive in 2016 to enhance a level of harmonisation in this market across EU member states. Typical intermediaries involved in distribution include: A firm can design any number of channels they require to reach customers efficiently and effectively. Channels can be distinguished by the number of intermediaries between producer and consumer. If there are no intermediaries then this

612-584: The United Kingdom : the only store outside of North America. There are shows every month. It also sells sell its clothing to independent boutiques within Canada. The company's flagship, resides in Rockefeller Center , NYC. It is Free People's largest standing store, but it is not much different from the other brick and mortar stores. The theme and vibe of the brand is apparent from store to store. In May 2015,

648-540: The company was criticized online by professional ballet dancers for using an untrained dancer in an ad. In April 2016, the company was criticized for the advertisements of its new clothing line directed towards music festival attendees. The advertisements promoted Native American styled clothing on a Caucasian model, which garnered criticism on social media . Free People lists the following athletes as brand ambassadors: Track & Field Tennis Volleyball Snowboard Distribution channel Distribution

684-537: The distribution of income in labor markets. The neoclassical growth model provides an account of how the distribution of income between capital and labor is determined in competitive markets at the macroeconomic level over time with technological change and changes in the size of the capital stock and labor force. More recent developments of the distinction between human capital and physical capital and between social capital and personal capital have deepened analysis of distribution. Vilfredo Pareto proposed

720-413: The distribution of income, for example human capital theory and the theory of economic discrimination (Becker, 1993, 1971). In welfare economics , a level of feasible output possibilities is commonly distinguished from the distribution of income for those output possibilities. But in the formal theory of social welfare , rules for selection from feasible distributions of income and output are

756-796: The distributor (as the materials supplier), design services, sub-contractors, local realtors and housing financiers. Laurence C. Hart refers to the extensive development of these guilds and the "Training Schools" which they operated, converting these into a radio-based program from 1942. Hart, who worked for the supplier, put this experience forward to the American Marketing Association as "an outstanding example of manufacturer-distributor collaboration on an industry-wide basis". Companies wishing to grow through sales to new markets may need to identify and develop relationships with local distributors, for example to support export to new markets. In southeast Asia , for example, many distributors have

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792-512: The end-user, the consumer. This is mostly accomplished through merchant retailers or wholesalers or, in the international context, by importers. In certain specialist markets, agents or brokers may become involved in the marketing channel: for example in the insurance sector, the European Union has noted that "insurance and reinsurance intermediaries play a central role in the distribution of insurance and reinsurance products" . The EU introduced

828-404: The factors that might affect them (globalization, tax policy, technology, etc.). Distribution has been central in the study of political economy since the 19th century, as shown in scholarship by Adam Smith , David Ricardo , and John Stuart Mill . Income distribution can describe a prospectively observable element of an economy. It has been used as an input for testing theories explaining

864-402: The firm's products, then select appropriate channel members or intermediaries. An organization may need to train staff of intermediaries and motivate the intermediary to sell the firm's products. The firm should monitor the channel's performance over time and modify the channel to enhance performance. To motivate intermediaries the firm can use positive actions, such as offering higher margins to

900-452: The growth of e-commerce, the globalization of markets, the advent of category killers (such as Officeworks and Kids 'R Us ) as well as changes in the legal or statutory environment. For instance, in Australia and New Zealand, following a relaxation of laws prohibiting supermarkets from selling therapeutic goods, consumers have gradually switched away from pharmacies and toward supermarkets for

936-433: The intermediary, special deals, premiums and allowances for advertising or display. On the other hand, negative actions may be necessary, such as threatening to cut back on margin, or hold back delivery of product. Care must be exercised when considering negative actions as these may fall foul of regulations and can contribute to a public backlash and a public relations disaster. Manufacturer complacency has been highlighted as

972-417: The media mix would be weighted toward mass-market media such as newspapers, magazines, television, and radio. Distribution of products takes place through a marketing channel , also known as a distribution channel. A marketing channel is the people, organizations, and activities necessary to transfer the ownership of goods from the point of production to the point of consumption. It is the way products get to

1008-401: The need to reduce the time a product spends in transit or in storage. In other cases, distribution systems can become quite complex involving many levels and different types of intermediaries. In practice, many organizations use a mix of different channels; a direct sales force may call on larger customers. This may be complemented with other agents to cover smaller customers and prospects. When

1044-545: The other three elements being product , pricing , and promotion . Decisions about distribution need to be taken in line with a company's overall strategic vision and mission . Developing a coherent distribution plan is a central component of strategic planning . At the strategic level, as well as deciding whether to distribute directly or via a distribution network, there are three broad approaches to distribution, namely mass, selective and exclusive distribution. The number and type of intermediaries selected largely depends on

1080-473: The product or brand, thereby pulling it through the distribution channel. The choice of a push or pull strategy has important implications for advertising and promotion. In a push strategy, the promotional mix would consist of trade advertising and sales calls while the advertising media would normally be weighted toward trade magazines, exhibitions, and trade shows while a pull strategy would make more extensive use of consumer advertising and sales promotions while

1116-531: The product or service can be found at cheaper prices, when superior models become available, when a wider range is offered, or simply because it is more convenient to shop through a different channel (e.g. online or one-stop shopping). As a hedge against market share losses due to switching behaviour, some retailers engage in multi-channel retailing. The emergence of a service-dominant logic perspective has focused scholarly attention on how distribution networks serve to create customer value and to consider how value

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1152-474: The purchase of minor analgesics, cough and cold preparations and complementary medicines such as vitamins and herbal remedies. For the consumer, channel switching offers a more diverse shopping experience, which may concern some sellers by its potential to erode market share. Evidence of channel switching can suggest that disruptive forces are at play, and that consumer behaviour is undergoing fundamental changes. A consumer may be prompted to switch channels when

1188-419: The strategic approach. The overall distribution channel should add value to the consumer. Distribution is fundamentally concerned with ensuring that products reach target customers in the most direct and cost-efficient manner. In the case of services, distribution is principally concerned with access. Although distribution, as a concept, is relatively simple, in practice distribution management may involve

1224-556: The term "customer fulfillment center" has been criticized on the grounds that it is a neologism , its use is becoming increasingly mainstream as it slowly makes its way into introductory marketing textbooks. Disintermediation occurs when manufacturers or service providers eliminate intermediaries from the distribution network and deal directly with purchasers. Disintermediation is found in industries where radically new types of channel intermediaries displace traditional distributors. The widespread public acceptance of online shopping has been

1260-768: The wholesale line "Free People" was back in action. In the fall of 2002, the first Free People Boutique opened in Paramus , New Jersey . Since the first boutique opened, there are now boutiques all over the United States and Canada. Free People developed an app which allows users to shop and to upload their own looks and pictures wearing Free People clothing and products. In 2006, Free People partnered with Ed Mullen Studio to design an e-commerce strategy. As of 2021, Free People sells in over 1,400 specialty stores worldwide. Some department stores, such as Nordstrom and Bloomingdale's, have created in-store concept shops. Along with serving as URBN’s chief creative officer , Margaret Hayne

1296-411: The young people who lived and shopped in the area. When its popularity grew, he opened a second store, and he changed its name from Free People to Urban Outfitters . Urban Outfitters’ business began to grow rapidly. Dick’s then wife, Meg, oversaw the development of Urban Outfitters’ private label division, which supported product exclusive to Urban Outfitters. This proved to be quite successful; by 1984,

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