chapter 14 direct marketing, and...

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Chapter 14   

Retailing, Direct

Marketing, and

Wholesaling


Retailing!Retailing – all transactions in which the buyer

intends to consume the product through personal, family, or household use

!Retailer – an organization that purchases products for the purpose of reselling them to ultimate consumers

!Multichannel retailing – employing multiple distribution channels that complement brick-and-mortar stores with websites, catalogs, and apps where consumers can research products, read other buyers’ reviews, and make actual purchases


Table 14.1 – General-Merchandise Retailers (1 of 2)

Type of Retailer Description ExamplesDepartment store Large organization offering a wide

product mix and organized into separate departments

Macy’s, Sears, JCPenney

Discount store Self-service, general-merchandise store offering brand-name and private-brand products at low prices

Walmart, Target, Dollar General

Convenience store Small, self-service store offering narrow product assortment in convenient locations

7-Eleven, Allsup’s

Supermarket Self-service store offering complete line of food products and some non-food products

Kroger, Safeway, Publix, HEB


Table 14.1 – General-Merchandise Retailers (2 of 2)

Type of Retailer Description ExamplesSuperstore Giant outlet offering all food and non-

food products found in supermarkets, as well as most routinely purchased products

Walmart Supercenters, SuperTarget

Hypermarket Combination supermarket and discount store, larger than a superstore

Carrefour, Lulu

Warehouse club Large-scale, members-only establishments combining cash-and-carry wholesaling with discount retailing

Sam’s Club, Costco

Warehouse showroom

Facility in a large, low-cost building with large on-premises inventories and minimal service

IKEA


Strategic Issues in Retailing! Consumer purchases are influenced by social and

psychological factors. ! Retailers should:

" Make desired products available " Create stimulating shopping environments " Develop marketing strategies that increase patronage

! Strategic issues: " Location " Retail positioning " Store image " Category management


Location of Retail Stores (2 of 2)! Types of shopping centers:

" Neighborhood shopping centers – a type of shopping center usually consisting of several small convenience and specialty stores

" Community shopping centers – a type of shopping center with one or two department stores, some specialty stores, and convenience stores

" Regional shopping centers – a type of shopping center with the largest department stores, widest product mixes, and deepest product lines of all shopping centers

" Superregional shopping centers – a type of shopping center with the widest and deepest product mixes that attract customers from many miles away

" Lifestyle shopping center – a type of shopping center that is typically open air and features upscale specialty, dining, and entertainment

" Power shopping center – a type of shopping center that combines off-price stores with category killers


Retail Technology!Most retailers have websites. ! Larger retailers have their own apps for customers. !Beacons send real-time messages and offers to

customers with Bluetooth-enabled smartphones. !Additional technology:

" Smart mirrors " Virtual fit " Self-checkout " Digital wallet

!Web-rooming – consumers research products online and then make the actual purchase from a brick-and-mortar store


Direct Marketing!Direct marketing – the use of the telephone,

Internet, and nonpersonal media to introduce products to customers, who can then purchase them via mail, telephone, or the Internet

!Nonstore retailing – the selling of products outside the confines of a retail facility


Online Retailing

!Online retailing – retailing that makes products available to buyers through Internet connections

!Rapidly growing segment that most retailers view as vital to business

!Consumers expect to: " Access multiple channels available to obtain goods

and services " Perform a wide variety of shopping-related tasks


Direct-Response Marketing!Direct-response marketing – a type of marketing

in which a retailer advertises a product and makes it available through mail or telephone orders

!Customers generally use a credit card. !Also conducted via a mailing list !Products must be priced above $20 to justify the

advertising and distribution costs.


Television Home Shopping

!Television home shopping – a form of selling in which products are presented to television viewers, who can buy them by calling a toll-free number and paying with a credit card

!Advantages: " " "

Stephanie Larkin


Direct Selling!Direct selling – marketing products to ultimate

consumers through face-to-face sales presentations at home or in the workplace

!Contacts with buyers are prearranged with individuals or parties.

!Advantages: " "

!Disadvantages: " "

Stephanie Larkin


Franchising ! Franchising – an arrangement in which a supplier

(franchisor) grants a dealer (franchisee) the right to sell products in exchange for some type of consideration

! Franchisor receives a percentage of sales for supplying: " Equipment and buildings " Management know-how and marketing assistance

! Franchisee: " Supplies labor and capital " Operates the franchised business " Abides by the provisions of the franchise agreement

chapter 14 direct marketing, and...

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