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Taza Chocolate Companys Distribution Channels
Taza is a small chocolate-making company based in Sommerville, Massachusetts, which manufactures unique stoneground organic chocolate in the classic Mexican tradition. It has a staff of about 20 people and sources all its ingredients directly from certified organic growers, with whom the company maintains personal relationships. Taza distributes its products at different price points through three channels: wholesale, distributors, and direct retail (Iacobbucci, 2018). Distributors buy in the largest quantities and at the lowest price; wholesale prices are slightly higher, and direct retail has the highest price point.
The three channels make different contributions to the companys marketing efforts. Distributors purchase large quantities of products and resell them to wholesalers, providing the largest market coverage. They run promotions to increase sales and achieve wider distribution. Wholesalers buy goods in medium quantities and sell them to individual resellers. They play the most crucial role in the supply chain process because they provide storage and timely delivery of products to buyers. Direct sales are affected through the companys website and involve direct communication with customers. The prices are the highest, and the quantities are the smallest.
For Taza, wholesale is the most effective channel of distribution that allows the company to maintain the same personal relationships with buyers as with suppliers. Wholesalers accept the companys price policy and purchase the amounts of products that the company is comfortable with. Distributors, on the other hand, are always trying to bargain and organize promotions that are not in line with the companys policy (Iacobbucci, 2018). Taza does not rely on advertising or promotional campaigns to increase the popularity of its products. Instead, it uses social networks, the companys website, themed events and exhibitions, food shows and in-store tastings to attract new customers (Iacobbucci, 2018). Direct sales also facilitate this approach by creating personalized relationships with customers that purchase chocolate directly from the Taza website. To further develop in this direction, the company is planning on opening a factory store.
Pricing the products differently based on the channel is a beneficial strategy. As distributors buy the largest quantities, they are offered the lowest prices. Wholesalers generally buy less, and the price is slightly higher, constituting a 40 or 50 percent of the products shelf price (Iacobbucci, 2018). Direct sale prices are the highest because they include storage, employee, operating, and delivery costs. The most beneficial pricing strategy is based on the balance between healthy sales volumes and profitability, with the largest sales volumes achieved by offering the lowest price.
Integrated marketing is an approach to creating a uniform and seamless experience for consumers in their interaction with the brand. It aims to include all aspects of marketing communication, such as advertising, promotion, direct marketing, social media, and public relations, and ensure that they are consistent across all channels. Taza applies the principles of integrated marketing in direct and wholesale sales. The company positions itself as a premium brand that maintains personal relationships with its suppliers, wholesalers, and customers (Iacobbucci, 2018). These relationships are fostered through direct online sales and the companys participation in chocolate salons, food shows, festivals, and exhibitions, where it promotes its products. Taza mainly relies on responsible wholesalers in distribution and makes efforts in building personal relationships with them, as it does with its suppliers. Overall, the company strives to create an integrated marketing experience for customers by maintaining a clear and personalized distribution process.
Reference
Iacobbucci, D. (2018). Marketing management (5th ed.). Cengage.
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