What does "distribute" mean here? Presumably you built the release version of your app using Product -> Archive. What steps did you then follow in the organizer window?
Note that if you're putting your app in the App Store, you need a 3rd party developer app distribution certificate. If you're distributing your app outside the App Store, you should use a Developer ID certificate so that your app passes Gatekeeper checks. You'd only use the Development certificate for internal/test builds that need to be code signed but it doesn't matter how.
My guess is that you are haven't created the kind of certificate you need for the kind of distribution you're trying to do, hence the question about what you actually did in the organizer.
Also, just to cover the obvious: Did you check your target info (select the project item in the navigator, choose the General tab) to make sure you have your team (i.e. developer program id) selected?