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Push and pull -strategy


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Push and pull -strategy

  1. 1. "Push and pull" redirects here. For other uses, see Push and pull (disambiguation).The image shows a technology push, mainly driven by internal R&D activities and market pull, driven by the external marketforces.[1] [2]The business terms push and pull originated in the logistic and supply chain management, but are also [3][4]widely used in marketing.A push-pull-system in business describes the movement of a product or information between twosubjects. On markets the consumers usually "pulls" the goods or information they demand for their needs,while the offerers or suppliers "pushes" them toward the consumers. In logistic chains or supply chains [5]the stages are operating normally both in push- and pull-manner. The interface between push-based [5]stages and pull-based stages are called push-pull boundary or decoupling point. Contents [hide]1 Marketing o 1.1 Push strategy o 1.2 Pull strategy2 Supply chains3 Push Pull Music Marking Future4 See also5 References[edit]Marketing[edit]Push strategyAnother meaning of the push strategy in marketing can be found in the communication between sellerand buyer. In dependence of the used medium, the communication can be either interactive or non-
  2. 2. interactive. For example, if the seller makes his promotion by television or radio, its not possible for thebuyer to interact with. On the other hand, if the communication is made by phone or internet, the buyerhas possibilities to interact with the seller. In the first case information is just "pushed" toward the buyer,while in the second case it is possible for the buyer to demand the needed information according to hisrequirements. Applied to that portion of the supply chain where demand uncertainty is relatively small Production & distribution decisions are based on long term forecasts Based on past orders received from retailer’s warehouse (may lead to Bullwhip effect) Inability to meet changing demand patterns Large and variable production batches Unacceptable service levels Excessive inventories due to the need for large safety stocks less expenditure on advertising than pull strategy[edit]Pull strategyIn a "pull" system the consumer requests the product and "pulls" it through the delivery channel. Anexample of this is the car manufacturing company Ford Australia. Ford Australia only produces cars whenthey have been ordered by the customers. Applied to that portion of the supply chain where demand uncertainty is high Production and distribution are demand driven No inventory, response to specific orders Point of sale (POS) data comes in handy when shared with supply chain partners Decrease in lead time Difficult to implement[edit]Supply chainsMain article: Supply chain managementWith a push-based supply chain, products are pushed through the channel, from the production side up tothe retailer. The manufacturer sets production at a level in accord with historical ordering patternsfrom retailers. It takes longer for a push-based supply chain to respond to changes in demand, which canresult in overstocking or bottlenecks and delays (the bullwhip effect), unacceptable service levels andproduct obsolescence.In a pull-based supply chain, procurement, production and distribution are demand-driven so that they arecoordinated with actual customer orders, rather than forecast demand.
  3. 3. A supply chain is almost always a combination of both push and pull, where the interface between the [5]push-based stages and the pull-based stages is known as the push–pull boundary. An example of thiswould be Dells build to order supply chain. Inventory levels of individual components are determined byforecasting general demand, but final assembly is in response to a specific customer request. The push-pull boundary would then be at the beginning of the assembly line.[edit]Push Pull Music Marking Future This section may require cleanup to meet Wikipedias quality standards. Please improve this section if you can. The talk pagemay contain suggestions. (August 2009)Many media and music futurists are speculating upon the change within the industry. The introductionand success of social networking along with digital music has transformed and re-shaped the way musicis marketed to the consumer; shifting from a push to pull strategy. In media and advertising everything isswitching to pull. There is an eminent difference between the consumer receiving information from a pushstrategy and a pull strategy. Push example; passive, the marketing campaign is in control of the messagebeing sent out and how it is received by potential customers. Pull example; active, the recipient of themarketing campaign is in control of the message and their decision whether to act or not. Generally theshift from push to pull has been viewed as a shift in power to the consumer away from advertisers and sois bad news for marketers.With the increase of social networking platforms and users, with emphasis to Facebook, social networkinghas become a major and focal part to music marketing adopting the pull marketing strategy. Pullmarketing shifts the emphasis and attention onto the customer, the essential attribute is to market in thecorrect places and knowing where and who the target audience are.Consumers are increasingly customizing music platforms to better suit their individual needs. Rather thanrelying on music companies or a DJ to pre-determine the mix of songs on a CD, an increasing number ofmusic listeners are downloading individual tracks and assembling their own sequence of songs. Thisprocess is also being replicated with the creation of playliststhrough platforms suchas iTunes, Spotify and Last FM. Fan-built playlists and mixes are taking over the way people get theirmusic. Playlists are inevitably becoming a pull marketing resource that marketing alliances must embrace,due to their ability to be share via Peer to peer networks. People are choosing what they want to hearrather than having it pushed on them.As consumers gain access to a greater number of options/platforms and more information about suchservices, the consumer will probably become more demanding on resource providers. Requiring servicesto be made available on consumers terms, when and where they want them, rather than when and whereit is convenient for the resource providers to deliver them. In addition, as mentioned above consumers are
  4. 4. demanding the ability to configure their own products from resource providers, leading to rapid growth inoptions and music services. Inevitably shifting music marketing from push to pull, as digital music servicestry out different models and features to try and find the optimum mix and consumer satisfaction.