E101: DistributionRyan Poissant - MaRSemail: rpoissant@marsdd.comtwitter: @ryanpoissant
ProductPricePlacePromotion      3The Four P s
The Four P sProductPriceDistributionPromotion               4
53 Parts: Delivery, Sales, Service
It s OK and often optimal to mix &match.                               62 Flavours: Direct, Indirect
7How to Choose?
8Market type;Existing, Re-segmented, New
9Market Stage
10Complexity
11Price
12Customer Preference
Default Choices                                       13 Channel  Type             Direct                         Indirect...
OtherFactors• Size of market• Diversity/complexityof market•  Proximity of market• Completeness ofoffering• Cost of channe...
15Not just a tactic...
16                         Amazon                            Dell...for some a Strategy     Apple
17
18
1970 - Invented             1976 - Patented             1986 – Launched             Sold as a complete solution,          ...
1970 - Invented             1976 - Patented             1986 - Launched             Sold as a complete solution,          ...
1989 - Jean Paul Gaillard namedCommercial Director.Pivots                            21Background
22Separate machine & coffee.Sell to consumers.
Made and serviced by 3rd           parties.           Sold through independent retail           stores.           Manufact...
Sold online and over the phonedirect to members of the NespressoClub.Delivered direct to consumers in 24hours or less.    ...
As market matured Nespressoadded their own brand machinesmade by an OEM.Added it s own retail boutiques tofurther control ...
~$3 billion           in annual            revenue            30%            CAGR           over 10            years      ...
Questions?Comments?Suggestions?                                           27Thanks!Ryan Poissant   rpoissant@marsdd.com   ...
Distribution - Entrepreneurship 101
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Distribution - Entrepreneurship 101

  1. 1. E101: DistributionRyan Poissant - MaRSemail: rpoissant@marsdd.comtwitter: @ryanpoissant
  2. 2. ProductPricePlacePromotion 3The Four P s
  3. 3. The Four P sProductPriceDistributionPromotion 4
  4. 4. 53 Parts: Delivery, Sales, Service
  5. 5. It s OK and often optimal to mix &match. 62 Flavours: Direct, Indirect
  6. 6. 7How to Choose?
  7. 7. 8Market type;Existing, Re-segmented, New
  8. 8. 9Market Stage
  9. 9. 10Complexity
  10. 10. 11Price
  11. 11. 12Customer Preference
  12. 12. Default Choices 13 Channel Type Direct Indirect Market Type New Re-segmented Existing Market Stage Early Midstage Mature ProductComplexity Complex Simple Price Expensive Cheap
  13. 13. OtherFactors• Size of market• Diversity/complexityof market•  Proximity of market• Completeness ofoffering• Cost of channel• Speed to market 14
  14. 14. 15Not just a tactic...
  15. 15. 16 Amazon Dell...for some a Strategy Apple
  16. 16. 17
  17. 17. 18
  18. 18. 1970 - Invented 1976 - Patented 1986 – Launched Sold as a complete solution, machines & coffee for a per cup price to restaurants and offices. 19Background
  19. 19. 1970 - Invented 1976 - Patented 1986 - Launched Sold as a complete solution, machines & coffee for a per cup price to restaurants and offices. 1988 - Acknowledged dud, Nestle considers shutdown. 20Background
  20. 20. 1989 - Jean Paul Gaillard namedCommercial Director.Pivots 21Background
  21. 21. 22Separate machine & coffee.Sell to consumers.
  22. 22. Made and serviced by 3rd parties. Sold through independent retail stores. Manufacturers handle delivery and stocking. Nespresso handles sales training. 23Machines
  23. 23. Sold online and over the phonedirect to members of the NespressoClub.Delivered direct to consumers in 24hours or less. 24Coffee
  24. 24. As market matured Nespressoadded their own brand machinesmade by an OEM.Added it s own retail boutiques tofurther control the sales message.Created Nespresso Pro channel toserve the office market. 25Later
  25. 25. ~$3 billion in annual revenue 30% CAGR over 10 years 50 countries 20 billion capsules 12 million machines 26Results
  26. 26. Questions?Comments?Suggestions? 27Thanks!Ryan Poissant rpoissant@marsdd.com @ryanpoissant
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