Marketing Ch. 13

Types of Retailers

1. Chain stores (Corporate Chains) = two or more outlets that are commonly owned and controlled. (CVS, Sears) 2. Voluntary chain — a wholesaler sponsored group of independent retailers that engages in group buying and common merchandising. 3. Retailer cooperative — independent retailers bands together to set up a jointly owned 4. Franchise — based on some unique product or service; on a method of doing business. Merchandising conglomerates = combine several different retailing forms under one central ownership. (Express, Victoria's Secret)

Types of Wholesalers

1. Merchant wholesalers = independent intermediaries that buy goods from manufacturers and sell to retailers and other business-to-business customers. 2. Full-service merchant wholesalers = provide services including delivery, credit, product-use assistance, repairs, adverting, and other promotional support. 3. Limited-service merchant wholesalers = provide fewer services for their customers. . 4. Broker = brings buyers and sellers together, assists in negotiation. 5. Agents = represent buyers or sellers on a more permanent basis. (Common type = Manufacturers' agents or manufacturers' representatives) 6. Manufacturers' sales branches and offices = form of wholesaling by sellers or buyers themselves

Retail Marketing Decisions

1. Segmentation targeting, differentiation, and positioning = definition and profile of the market so the other retail marketing decisions can be made 2. Retail Product = Retailers must decide on three major product variables: - Product assortment (should differentiate) - Services mix can help set one retailer apart from another. - Store atmosphere (design & layout/image of the store) 3. Retail Pricing Most retailers seek either: -High markups on lower volume (most specialty stores) -Low markups on higher volume (mass merchandisers and discount stores). 4. Other pricing decisions: - High-low pricing - Everyday low pricing (EDLP) - Price policy = must fit the target market and positioning, product and service assortment, and competition 5. Retail Promotion = Retailers use any or all of the promotion tools—advertising, personal selling, sales promotion, public relations, and direct marketing—to reach consumers. 6. Retail Location = accessible to the target market in areas Location options include: - Central business districts - Regional shopping centers, or regional shopping malls - Community shopping centers - Neighborhood shopping centers or strip malls - Power centers are huge unenclosed shopping centers - Lifestyle centers

Retailers

Retailing = all the activities involved in selling products or services directly to final consumers for their personal, nonbusiness use. Retailers = businesses whose sales come primarily from retailing

Mega-retailers

Rise of mass merchandisers and specialty superstores, the formation of vertical marketing systems, and a rash of retail mergers and acquisitions. - Superior information systems - Buying power - Large selection

Classifying by level of service

Self-service retailers = Wal-Mart and Supermarkets. Limited service retailers = Sears and JC Penney. Full-service retailers = assist customers in every phase, higher costs (Department stores and specialty stores)

Retailer Types

Specialty stores = carry narrow product lines with deep assortments within those lines. Department stores = carry a wide variety of product lines. Supermarkets = the most frequently shopped type of retail store. Rapid growth bc of out-of-home eating. Convenience stores = small stores that carry a limited line of high-turnover convenience goods. Discount stores = stores that carry standard merchandise sold at lower prices with lower margins and higher volumes Off-price retailers = stores that sell merchandise bought at less-than retail. - Factory Outlets - Independent Off-Price Retailers - Warehouse clubs Superstores = much larger than regular supermarkets (food products, nonfood items, and services)

Retailing Trends and Developments New Retail Forms and Shortening Retail Life Cycles

Wheel-of-retailing concept = states that many new types of retailing as low-margin, low-price, low-status operations, and challenge established retailers. As they succeed they increase their costs eventually becoming the retailers they replaced. Retail convergence = involves the merging of consumers, producers, prices, and retailers, creating greater competition for retailers and greater difficulty differentiating offerings Retail technology = provides better forecasts, inventory control, electronic ordering, transfer of information, scanning, online transaction processing, improved merchandise handling systems, and the ability to connect with customers

Marketing Mix Decisions

Wholesalers add customer value though the products and services they offer. Target market and positioning decisions - Size of customer - Type of customer - Need for service

Wholesaling Trends

Challenges 1. Resistance to price increases 2. Fewer suppliers 3. Changing customer needs 4. Adding value by increasing efficiency and effectiveness

Globalization

Many are expanding internationally to escape mature and saturated home markets.

Classify Retailers

Merchandise breadth = NO. OF DIFFERENT PRODUCT LINES AVAILABLE. Merchandise depth = CHOICES AVAILABLE FOR EACH SPECIFIC PRODUCT.

Wholesaling

selling goods and services to those buying for resale or business use.

Wholesaler Functions

1. Selling and promoting = help manufacturers reach many small customers at a low cost. 2. Buying and assortment building = select items and build assortments needed by their customers 3. Bulk breaking = breaking large lots into small quantities 4. Warehousing = hold inventories, thereby reducing the inventory costs and risks of suppliers and customers. 5. Transportation = provide quicker delivery to buyers because they are closer than the producers. 6. Financing = finance their suppliers by ordering early and paying bills on time (giving credit) 7. Risk bearing = taking title and bearing the cost of theft, damage, spoilage, and obsolescence. 8. Market information = give information to suppliers and customers about competitors, new products, and price developments. 9. Management services and advice = help retailers train their salesclerks, improve store layouts and displays, and set up accounting and inventory control systems.

Growth of non-store retailing

online retailing