Monday, March 1, 2010

Exclusive Distribution

Do you ever see something that you wish you could have, but much to your dismay can’t seem to locate that product for the life of you? Chances are that product was exclusively distributed.

Exclusive distribution is when a limited number of dealers have the exclusive right to distribute the company’s products in their territories (Kotler 307). This practice is very common among extremely rare items as well as those items reserved for the upper echelon of society. These goods can range from limited edition collectibles to multimillion-dollar automobiles.
Having been a so-called “sneaker head” I have experience my fair share of exclusive distribution. Urban dictionary defines a sneaker head as “a person who collects limited, rare, OG, or flat out exclusive kicks [shoes]. Usually the collection consists of Jordans or Dunks.” During my tenure as a sneaker head I had to keep up on the release dates of these rare and collectible sneakers. Now, these rare and collectible sneakers wouldn’t just be sold at any store, they would be sold to incredibly specific retailers meant to sell those types of goods. Nike has collaborated with a small number of specific stores in which they release their line of SB (Skateboarding) shoes, one of those stores being Goods, located in downtown Seattle. Stores like Goods experience exclusive distribution since they receive a limited number of these rare products; once they sell out, that’s usually it, since Nike rarely reproduces these collectibles. Often times, during release dates of highly hyped shoes there will be an extremely long line day, even weeks, before the store actually launches the shoe. The demand is so high that retailers usually sell out before catering to all customers in queue. Exclusive distribution is a crucial part of the “shoe game” because it provides sneaker heads with another reason to be involved. Some shoe gurus join the sneaker scene for style, some join to resell, and some join to be different. Whatever the reason is exclusive distribution has allowed for these people to express themselves.

Exclusive distribution is not just evident in the shoe world it can be seen wherever there are limited releases or high-end goods like supercars. Just like Nike collaborates with these specific stores, Bentley, Rolls Royce, Bugatti, and other top-notch car manufacturers only sell their cars at very specific dealers. Once again, this is an example of exclusive distribution.
Exclusive distribution is all around us; sometimes we just don’t notice it because often times we aren’t the targeted market for these goods.

The video below shows a group of sneaker heads awaiting the release of Nike Air Yeezy's at Goods in Seattle 3 days before the launch date. Goods is an exclusive distributor of rare and limited Nike sneakers.

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-Jon Honari, Section E

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