Diane is a dermatologist and founder of a cosmetics company with unique products targeted to women over 45 years old. Her signature line, called AgeBeGone, includes anti-wrinkle creams, reparative skin balms, and revitalizing bath oils. She has hired you as marketing manager to boost the brands sales. AgeBeGone products are based on exotic botanicals, packaged in designer boxes, and priced higher than the competition. Since launching the line, Diane has sold it through luxurious skin care boutiques that she runs in the Southeast. This has enabled her to train her own salespeople who analyze customers skin needs, demonstrate the products, and follow up with purchasers to build relationships.

Dianes ultimate goal is to carve out a niche for AgeBeGone as the indispensable personal luxury brand for stylish, affluent older women. Unwilling to lower prices in order to achieve high volumewhich would compromise the brands exclusive, high-end imageshe prefers to stick with high-price, high-profit-margin sales. Choosing the right distribution strategy to support the brands buildup will be key to reaching this goal.

Direct distribution has worked well for AgeBeGone so far, helping to establish a high degree of brand trust by linking Dianes company closely to her customers. It also facilitates positive word of mouth among those who are familiar with the product and who enjoy similar purchasing experiences. Sticking with this strategy is low-risk, which makes Diane reluctant to abandon it.

In its current form, however, direct distribution limits the lines future growth. There is no opportunity to build AgeBeGones visibility beyond the audience of women who live near the boutiques. Youve advised Diane that it makes sense to continue on this path only if you can create additional direct outlets.

Indirect distribution would give AgeBeGone exposure to a far larger and more diverse audience, enabling the brand to build a national profile. Also, working with channel intermediaries would give you access to promotional and other resources that Dianes small firm cannot afford. The disadvantage of this strategy is that it would mean less control over the purchase experience.

Which distribution strategy should you choose?