chapter 14 retailers, wholesalers, and direct marketers principles of contemporary marketing kurtz...
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Chapter 14Retailers, Wholesalers,
and Direct Marketers
Principles of
Contemporary MarketingKurtz & Boone
CHAPTER 14 Retailers, Wholesalers, and Direct Marketers
Chapter Objectives
1. Explain the wheel of retailing.
2. Discuss how retailers select target markets.
3. Show how the elements of the marketing mix apply to retailing strategy.
4. Explain the concepts of retail convergence and scrambled merchandising.
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CHAPTER 14 Retailers, Wholesalers, and Direct Marketers
Chapter Objectives
5. Identify the functions performed by wholesaling intermediaries.
6. Outline the major types of independent wholesaling intermediaries and the appropriate situations for using each.
7. Compare the basic types of direct marketing and nonstore retailing.
8. Describe how much the Internet has altered the wholesaling, retailing, and direct marketing environments.
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CHAPTER 14 Retailers, Wholesalers, and Direct Marketers
o Retailers base key decisions on two fundamental steps in the marketing strategy process:o Selecting a target market
o Developing a retailing mix to satisfy the chosen market
Retailing Strategy
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CHAPTER 14 Retailers, Wholesalers, and Direct Marketers
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CHAPTER 14 Retailers, Wholesalers, and Direct Marketers
o Guides retailer’s decisions on the items it will offer
o While developing the merchandise mix, retailers should consider:o Needs and preferences of its target market
o Competitive environment influencing choices
o Overall profitability of each product line and category
Merchandising Strategy
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CHAPTER 14 Retailers, Wholesalers, and Direct Marketers
o Heightened customer service is one possible retailing strategy
o The goal is to attract and retain target customers to increase sales and profits
o Some services that retailers could provide:o Enhanced comfort through lounges,
complimentary coffee, convenient restrooms
o Child-care services for customers
o Virtual assistance programs
Customer Service Strategy
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CHAPTER 14 Retailers, Wholesalers, and Direct Marketers
o Prices reflect a retailer’s marketing objectives and policies
o They affect consumer perceptions
Pricing Strategy
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CHAPTER 14 Retailers, Wholesalers, and Direct Marketers
o Location depends on many factors, including the type of merchandise, the retailer’s financial resources,characteristics of the target market, and site availability
Location/Distribution Strategy
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CHAPTER 14 Retailers, Wholesalers, and Direct Marketers
o Promotion informs customers about locations, merchandise selections, hours of operation, and prices
o Helps retailers attract shoppers and build customer loyalty
o National chains purchase advertising in print and broadcast media
Promotional Strategy
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CHAPTER 14 Retailers, Wholesalers, and Direct Marketers
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CHAPTER 14 Retailers, Wholesalers, and Direct Marketers
o By form of ownership
o By shopping effort
o By services provided
o By product lines
Classification of Retailers
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CHAPTER 14 Retailers, Wholesalers, and Direct Marketers
o Retail convergence - Situation in which similar merchandise is available from multiple retail outlets, resulting in the blurring of distinctions between type of retailer and merchandise offered
o Scrambled merchandising - Retailing practice of combining dissimilar product lines to boost sales volume
Retail Convergence and Scrambled Merchandising
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CHAPTER 14 Retailers, Wholesalers, and Direct Marketers
o Creating utility
o Providing services
o Lowering costs by limiting contacts
Functions of Wholesaling Intermediaries
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CHAPTER 14 Retailers, Wholesalers, and Direct Marketers
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CHAPTER 14 Retailers, Wholesalers, and Direct Marketers
o Direct marketing - Direct communications, other than personal sales contacts, between buyer and seller, designed to generate sales, information requests, or store or Web site visits
Direct Marketing and Other Nonstore Retailing
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CHAPTER 14 Retailers, Wholesalers, and Direct Marketers
o Direct mail
o Direct selling
o Direct-response retailing
Other Nonstore Retailing
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CHAPTER 14 Retailers, Wholesalers, and Direct Marketers
o Direct marketing conducted by telephone
o Most frequently used form of direct marketing
Telemarketing
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CHAPTER 14 Retailers, Wholesalers, and Direct Marketers
o Selling directly to consumers via Web storefronts
o Internet-based retailers keep little or no inventoryo Fill customer orders directly from vendors
o Some traditional brick-and-mortar stores have successfully extended their presence to the Web
o Examples: Gap and Lands’ End
Internet Retailing
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CHAPTER 14 Retailers, Wholesalers, and Direct Marketers
o Primarily used to sell food items, lottery tickets in the U.S.
o Other countries use vending machines to offer a wider variety of goods
o As technology advances, high-end products are being sold in vending machines
Automatic Merchandising
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