What does the term "exclusive distribution" refer to?

The term "exclusive distribution" refers specifically to a strategy where a manufacturer limits the sale of their products to a few selected retailers. This approach is typically used to create a sense of exclusivity around a brand, enabling retailers that carry the product to offer something unique that isn’t widely available through other channels. By selecting only a handful of retailers, companies can enhance brand image, maintain higher price points, and foster stronger relationships with those retailers who are granted exclusivity.

This strategy is beneficial for luxury brands or specialized products that seek to appeal to a more discerning customer base, where abundance might dilute the perceived value of the merchandise. In contrast, a strategy of selling through all available retailers would be considered an intensive distribution approach, which aims at maximizing product availability. Balancing distribution among competing brands does not align with the concept of exclusivity, and online-only sales also do not inherently define exclusive distribution, as they can cover a wider retail landscape without the selectivity of physical retailers.