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Retailing

Retailing. Final stop on the distribution path The process by which products are sold to consumers for personal use Retailers add value with image, inventory, service quality, location, and pricing policies. The Wheel of Retailing.

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Retailing

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  1. Retailing • Final stop on the distribution path • The process by which products are sold to consumers for personal use • Retailers add value with image, inventory, service quality, location, and pricing policies

  2. The Wheel of Retailing New types of retailers find it easiest to enter the market by offering goods at lower prices than competitors; after they gain a foothold, they gradually trade up, improving facilities and increasing the quality and assortment of merchandise, and offering special amenities; upscaling increases costs causing prices to rise; higher prices open the door for a new entrant charging lower prices

  3. Wheel of Retailing

  4. Wheel of Retailing

  5. Retail Life Cycle • Retailers are also products because they provide benefits and must offer a competitive advantage to survive • Introduction: new retailer takes a unique approach to doing business • Growth: retailer catches on with shoppers, sales and profits rise, others start to copy it so retailer expands offerings • Maturity: many have copied it and an entire industry has formed, profits decline • Decline: retail format becomes obsolete

  6. What’s in Store for the Future Demographics Globalization Technology

  7. Major Demographic Factors Convenience Catering to specific age groups Recognizing ethnic diversity

  8. Meeting Multiple Needs

  9. Retailers Go Global

  10. Classifying Retailers • All retailers are classified by the NAICS codes • Some lines still blurred • scrambled merchandising - strategy of carrying a combination of food and nonfood items

  11. Classifying Retailers by Service Self-service Limited-service Full-service

  12. Limited-Service Retailer

  13. Self-Service Retailer

  14. Limited-Service Retailer

  15. Full-Service Retailer

  16. Classifying by Merchandise Selection • Merchandise breadth is the number of different product lines available • Narrow versus broad assortments • Merchandise depth is the variety of choices available for each specific product • Shallow versus deep assortments

  17. Merchandise Selection

  18. Convenience stores Supermarkets Specialty stores Department stores Hypermarket stores Discount stores General merchandise discount stores Off-price retailers Warehouse clubs Factory outlet stores Store Types

  19. Convenience Stores

  20. Warehouse Clubs

  21. Nonstore Retailing • Any method a firm uses to complete an exchange that does not require a customer visit to a store • Direct selling • Automatic vending

  22. Direct Selling • Direct selling occurs when a salesperson presents a product to one individual or a small group, takes orders, and delivers the merchandise • Door-to-Door Sales • Parties and Networks • party plan systems • multilevel pyramid schemes

  23. Party Plan System

  24. Multi-level Networks Amway uses direct selling through multi-level networks to expand globally

  25. Automatic Vending • Appealing for selling convenience goods because of small space required, and minimal personnel to maintain and operate

  26. Vending Machines

  27. Levi Strauss Vending Machine Levi Strauss sells jeans in vending machines to French consumers

  28. Virtual Models Online

  29. Benefits Shop 24/7 Less travel More choices More information Price competition Fast delivery Limitations Lack of security Fraud Can’t touch items Hard to distinguish color/texture online Expensive to return E-Commerce and the Customer

  30. Comparison Web sites

  31. Benefits The World is your marketplace Decreases costs Very specialized businesses possible Real-time pricing Tracking of consumer behavior Limitations Lack of security Must maintain site Price competition Conflicts with conventional retailers Legal issues not resolved E-Commerce and the Marketer

  32. The Problem of Identity Theft

  33. Store Positioning Strategy Atmospherics Store Image

  34. REI Enhances Store Image

  35. Mapping Store Personality

  36. Store Design: Setting the Stage • Store layout and traffic flow • Fixture type and merchandise density • The sound of music • Color and lighting • The Actors: Store Personnel • Pricing policy

  37. Building the Theater: Store Location • Types of locations • Site selection • Location planners evaluate trade area and conduct site evaluation • traffic flow, number of parking spaces available, ease of delivery access, visibility from street, local zoning laws, population characteristics, community life cycle, mobility, degree of competition

  38. Grid Layout

  39. Types of Store Locations

  40. Site Selection • Reflect growth strategy • Convenient to customers in trade area • Population characteristics • Degree of competition • Target market location

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