Abstract

Distribution is one of the most important key success in sales. But due to hard competition in the market, sometimes the implementation of conventional distribution strategy alone is not enough. Therefore we need the synergy between the concept of conventional distribution with the concept of internet marketing, so it can create new alternative distribution channel that is a virtual distribution. With the application of this virtual distribution concept, product can reach a wider market with a more focused target, which is internet user. Implementation of this alternative distribution model has great potential to increase sales as well as deepen the product penetration.

Keywords: internet marketing, distribution, affiliate system

Introduction

From time to time internet users continues to increase significantly. It is driven by the cheapening of internet access and the development of technologies that make Internet access increasingly easy to do. Based on data from Internetworldstats.com, the world's Internet users has reached nearly 2 billion people, or equal to 28.7% of the world population. And based on the same data source, 12.3% or 30 million population of Indonesia has also been connected to the internet.

Research Method

This paper is a qualitative study that discusses the phenomenon of internet marketing and its application to increase sales in the consumer product company. Object of research is XYZ Ltd., a local telecommunications company operates nationally in Indonesia.

Internet Marketing

There are several definitions given by several experts to explain internet marketing. Chaffey define internet marketing as 'the application of the internet and related digital technologies to achieve marketing objectives' (Chaffey et al. 2000:6). Another definition presented by Strauss who tried to give a more comprehensive definition and sync them with marketing definition version of The American Marketing Association in Kotler et al. (2006). Strauss defines internet marketing as 'the use of information technology in the process of creating, communicating, and delivering aspects value to costumers, and for managing customer relationships in ways that benefits the organization and its stakeholders' (Strauss et al. 2006:3).

Meaning of Distribution

Distribution conventionally is understood as efforts to ensure the product is available in sufficient quantities in the right place consistently or continuously (Anonymous, 2001). Sufficient quantity here taken to mean that the number of products that are distributed must be in accordance with the level of market demand. As per the laws of economics, if the product is distributed more than required by the market, it will tend to cause prices to fall, and vice versa.

Utilization of Internet Marketing for Distribution

Products distributed is easily found by consumers so that the opportunity for the occurrence of sales transactions also becomes larger. Distribution of a broad and consistent product can also keep prices stable and to minimize the possibility of switching to a product brand to a competitor or substitute products. Consistency of the existence of products is also an important issue in the distribution. Consistency is necessary not only to ensure that the non-occurrence of missed opportunities to sell products because of the occurrence of vacancies, but also to minimize the likelihood of consumers switching to competitors' products or product substitution. In addition to the availability of products are consistently too petrified creation of price stability and minimize the possibility of speculation.

Virtual distribution as Alternative Distribution Strategy

So far the products offered by affiliate systems typically are limited to products that are digital, such as e-books, software, business opportunities, web hosting and digital music. Still quite difficult to find sites afiliator or manufacturer affiliate program providers who offer non-digital or tangible products. However, that does not mean physical products (non-digital) can not be distributed using this affiliate system. With integrating with conventional distribution network is actually an affiliate system can also be used to distribute the products of non-digital in cyberspace. Furthermore, the synergy of the two concepts earlier in this paper will be referred to as 'virtual distribution'.

Conclusion

One key to successful sales is distribution. But competition in the industry amid a very tight makes use of conventional distribution strategy as long as this run is not enough. For that alternative strategies are out-of-the-box is required. One strategy that can be done is to synergize with conventional distribution channels through internet marketing strategies. It could be a groundbreaking new business model that can be applied in the consumer product industry in Indonesia, so that Internet media can be used optimally to increase sales. Ways to synergize with conventional distribution of internet marketing is to develop one of the concepts in internet marketing business model, ie the business model known as referral or affiliate system or internet affiliate marketing, become an alternative distribution strategy.