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Chapter 13 Retailing and e-distribution PowerPoint PPT Presentation


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Presentation prepared by Robin Roberts, Griffith University and Mike Spark, Swinburne University of Technology. Chapter 13 Retailing and e-distribution. Chapter Objectives. Understand the purpose and function of retailers in the marketing channel Identify major types of retailers

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Chapter 13 Retailing and e-distribution

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Presentation prepared by Robin Roberts, Griffith University and Mike Spark, Swinburne University of Technology


Chapter 13Retailing and e-distribution


Chapter Objectives

  • Understand the purpose and function of retailers in the marketing channel

  • Identify major types of retailers

  • Explore strategic issues in retailing

  • Recognise the various forms of non-store retailing

  • Understand the characteristics of e-distribution

  • Examine the major types of franchising and the benefits and weaknesses of franchising


Retailing versus e-tailing in the florist industry

Dial-Up

Broadband

Roses Only


Retailing

Retailing includes all transactions in which buyers are the ultimate consumers, who intend to consume the product through personal, family or household use.

Retailers

  • are organisations

  • add value

  • and create utility


Major types of retail stores

  • Many types of retail stores exist

  • Classified by breadth of products

  • Two general categories include:

    • General-merchandise retailers

    • Specialty retailers


General-merchandise retailers

Department Stores

  • large retail organisations

  • wide product mixes

    Discount Stores

  • self-service, general-merchandise stores

  • brand name and private brand products

  • low prices

    Supermarkets

  • large, self-service stores

  • food and non food product ranges


General-merchandise retailers (cont’d)

Superstores

  • giant retail outlets

  • food and nonfood products

  • most routine consumer products

    Hypermarkets

  • combines supermarket and discount

    Warehouse Clubs

  • large-scale, members-only

  • combining cash-and-carry wholesaling with discount retailing


General-merchandise retailers (cont’d)

Warehouse Showrooms

  • large on-premise inventories

  • minimal services

    Catalog Showrooms

  • form of warehouse showroom

  • products are stored out of buyers’ reach

    Convenience Stores

  • Small stores in convenient locations

  • long opening hours

  • frequently purchased items


Specialty retailers

Specialty retailers emphasise narrow and deep assortments

There are 3 main types:

  • Traditional Specialty Retailers

  • Category Killers

  • Off-price retailers


Specialty retailers (cont’d)

Traditional Specialty Retailers

  • narrow product mix

  • deep product lines

  • higher costs and higher margins

  • more product selection

  • product expertise

  • high levels of personal service


Specialty retailers (cont’d)

Category Killers

  • concentrate on a major product categories

  • compete on low prices and availability

    Off-Price Retailers

  • buy seconds, overruns, returns and off-season merchandise

  • charge less than department stores for comparable merchandise

  • offer fewer customer services


Strategic issues in retailing

Consumer purchases may result from social and

psychological influences

Consumers shop for various reasons, retailers

must do more….

Factors affecting location

  • Intended target market trading area

  • Types of products being sold

  • Suitability of site for customer access

  • Customer characteristics

  • Location of competitive retail operations


Strategic issues in retailing (cont’d)

Types of Locations

  • Central business district (CBD)

  • Free-standing structures

  • Neighbourhood

  • Community

  • Regional

    Emerging types

    • Factory outlet centres

    • Miniwarehouse centres

    • Non-anchored centres


What factors should Aldi consider when selecting locations for its new stores?

Dial-Up

Broadband

Today Tonight footage courtesy of Seven Network


Types of traditional shopping centres

  • Neighborhood Shopping Centres

    • several small convenience and

    • specialty stores

  • Community Shopping Centres

    • one or more department stores

    • some specialty and convenience stores

  • Regional Shopping Centres

    • home to large department stores

    • widest product mix

    • deepest product lines


Types of emerging or non-traditional shopping centres

  • Factory Outlet Centres

    • feature discount and factory outlets

    • carrying traditional brand names

  • Miniwarehouse Centres

    • loosely planned centres that lease to retailers running stores out of warehouse bays

  • Non-anchored Centres

    • do not have traditional ‘anchors’

    • combine off-price and category killer stores in a ‘power centre’ format


Strategic issues in retailing (cont’d)

Retail positioning

  • Identifying an unserved or underserved market segment

  • a strategy that distinguishes the retailer from others in the minds of consumers in that segment

    Store image

  • Atmospherics

  • Interior layout

  • Exterior storefront and entrance design


Strategic issues in retailing (cont’d)

Scrambled merchandising

  • addition of unrelated products and product lines to an existing product mix

  • particularly fast-moving items that can be sold in volume

    Intent of scrambled merchandising:

    • one-stop shopping focus

    • Generate customer traffic

    • Realise higher profit margins

    • Increase impulse purchases


Strategic issues in retailing (cont’d)

The wheel of retailing

A hypothesis holding that new

retailers usually enter the market as

low-status, low-margin, low-price

operators but eventually evolve into

high-cost, high price merchants


The Wheel of Retailing


Non-store retailing

Non-store retailing is the selling of

products outside of the confines of a

retail facility

Three factors spurring growth:

  • Consumers

  • poorly informed sales force

  • Impact of older generation


Direct marketing

Direct marketing— use of telecommunications

and non-personal media to introduce products

  • Catalogue marketing

  • Direct-response marketing

  • Telemarketing

  • Television home shopping

  • Online retailing


Direct marketing

Catalogue Marketing

A type of marketing in which an organisation provides a catalogue from which customers can place orders by mail, telephone and the internet


Direct marketing (cont’d)

  • Direct-response marketingA type of marketing that occurs when a retailer advertises a product and makes it available through mail or telephone orders

  • TelemarketingThe performance of marketing-related activities by telephone


Direct marketing (cont’d)

  • Television home shoppingCan buy them by calling a toll-free number and paying with a credit card

  • Online retailingMakes products available to buyers through computer connections


Direct selling

  • Direct sellingThrough face-to-face sales presentations at home or in the workplace

  • Benefits

    • Convenience of time and place of presentation

    • Personal attention to customer

  • Limitations

    • High costs make it the most expensive form of selling

    • Negative consumer view of direct selling


Automatic vending

  • Automatic vendingUse of machines to dispense a product and used for small, routinely-purchased products

  • Benefits

    • continuous and efficient service

  • Limitations

    • high costs of equipment

    • possible frequent servicing and repairs

    • impersonal means of selling


e-distribution

The role of e-distribution is to make the

products available at the right time, at

the right place, in the right quantities

  • IT advances are allowing close synchronisation and cooperation between external suppliers and the firm and

  • internally between the manufacturing and customer contact operations


B2B e-distribution

B2B e-distribution has benefited from

organisational resources available to build

technologically advanced networks among

manufacturers and supply chain members.

Extranets

  • secure Web-based networks that connect companies with their customers and suppliers

  • B2B e-marketing infrastructures make the whole channel process more efficient


e-tailing

  • The Internet is becoming a major retail venue.

  • Security remains an issue which stops customers from using the online purchasing facilities.

  • As encryption technology improves, the trust and confidence of customers will make this an escalating opportunity for satisfying customer needs, particularly for information-based products and trading.


Franchising

A form of licensing in which a franchiser in exchange for a financial commitment, grants a franchisee the right to market its product in accordance with the franchiser’s standards.


Franchising

Retail franchises fall into three major categories:

  • Manufacturer authorises number of retail stores

    • Trucks, cars, shoes, paint, petrol

  • Producer licences to sell a given product to retailers

    • Soft drink industry

  • Franchiser supplies brands names, techniques or services

    • McDonalds, Gloria Jeans, Greens


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