In marketing, a territory is the place or region where a company sells its products or services.
Territory is a very important factor in marketing. Decisions regarding distribution will be determined by the target territory. Some of the aspects that will be determined by the territory include warehousing or storage, inventory management, ordering process, transportation, and other logistical details. Territory along with market coverage (whether it distribution will be inclusive, selective, or exclusive) will also affect the distribution channels that will be used.
Aside from the effects on logistics, territory will also help in the characterization of the target customers. For example, a company operating in the United States and China will have a different marketing strategy for each territory. This in turn will affect everything from product development to advertising.
A good example of how territory can affect product development is in branding. Logos, packaging and ads are often localized to make the product more appealing to customers of each territory. Products that may not necessarily be banned from a territory but is considered taboo will obviously not sell there, which means that a company will choose not to enter that territory or at least come up with a different product offering.