basic11_ppt.ppt 194KB Sep 05 2010 10:45:20 PM

Chapter Eleven

Roadmap:

Previewing the Concepts

1. Explain the roles of retailers and

wholesalers in the distribution channel.

2. Describe the major types of retailers and give examples of each.

3. Identify the major types of wholesalers and give examples of each.

4. Explain the marketing decisions facing retailers and wholesalers.

Whole Foods Market

 _{Has 170 stores worldwide}

with $4 billion in sales vs. 5000 stores and sales of $285 billion for Wal-Mart.

 _{Offers organic, natural,}

and gourmet foods.

 _{Positions itself AWAY}

from Wal-Mart:

“Whole Foods, Whole

Whole Foods Market – Finding Its

Whole Foods Market – Finding Its

Niche

Niche

Case Study

Case Study

Marketing Efforts

 _{Web site reinforces the}

company’s positioning.

 _{Caters to health conscious,}

affluent, liberal, educated consumer base.

 _{Both in-store and online}

shopping is a customer experience.

What Is Retailing?

 _Retailing:

– includes all the activities involved in selling products or services directly to final consumers for their personal, non-business use.

 _{Most retailing is done by retailers, but}

nonstore retailing has recently grown by leaps and bounds.

Types of Retailers

 _{Retailers are classified based on:}

– Amount of service they offer

– Breadth and depth of product lines

– Relative prices charged

Amount of Service

 _{Self-Service Retailers:}

– Serve customers who are willing to perform their own “locate-compare-select” process to save

money.

 _{Limited-Service Retailers:}

– Provide more sales assistance because they carry more shopping goods about which customers

need information.

 _{Full-Service Retailers:}

– Usually carry more specialty goods for which customers like to be “waited on.”

Major Store Retailer Types

 _{Specialty stores}

 _{Department stores}  _Supermarkets

– Category Killers

 _{Convenience stores}  _{Discount stores}

 _{Off-price retailers}  _Superstores

Relative Prices Classification

 _{Discount stores}

 _{Off-price retailers}

– Independent off-price retailers

– Factory outlets

• Factory outlet malls

• Value-retail centers – Warehouse club

Organizational Classification

 _{Corporate chain stores}

 _{Voluntary chain}

 _{Retailer cooperative}  _Franchise

Retailer Marketing Decisions

 _{Retailer Strategy:}

– Target market

– Retail store positioning

• Until retailers define and profile their markets, retailers cannot make

meaningful decisions related to the retailer marketing mix.

Retailer Marketing Decisions

 _{Retailer Marketing Mix:}

– Product assortment and services

– Price

– Promotion

Assortment and Service

Decisions

 _{Product assortment}

– Should differentiate the retailer while matching target shoppers’ expectations

 _{Services mix}

 _{Store atmosphere}

– Physical layout can help/hinder shopping

– Experiential retailing helps sell goods

Price and Promotion

Decisions

 _{Price policy must fit its target market} and positioning, product and service assortment, and competition.

 _{Can use any or all of the promotion} tools—advertising, personal selling, sales promotion, public relations, and direct marketing—to reach consumers.

Place Decisions

 _{Retailers can locate in central business} districts, various types of shopping

centers, strip malls, or power centers.  _{Location is key to success.}

The Future of Retailing

1. New Retail Forms and Shortening Retail Life Cycles

2. Growth of

Nonstore Retailing

3. Retail

Convergence

4. Rise of the Megaretailers

5. Growing

Importance of

Retail Technology

6. Global Expansion of Major Retailers

7. Retail Stores as “Communities” or “Hangouts”

Wholesaling

 _Wholesaling:

– includes all activities involved in selling goods and services to those buying for resale or business use.

 _{Wholesalers add value for producers} by performing one or more channel functions.

Functions Provided by

Wholesalers

 _Financing

 _{Risk bearing}  _Market

information  _Management

services and advice

 _{Selling and} promoting  _{Buying and}

assortment building

 _{Bulk-breaking}  _Warehousing  _{Transportation}

Types of Wholesalers

 _{Merchant Wholesalers}

– Largest group of wholesalers

– Account for 50% of wholesaling

– Two broad categories:

• Full-service wholesalers

Types of Wholesalers

 _{Brokers and Agents}

– Do not take title to goods

– Perform fewer functions

– Brokers bring buyers and sellers together

– Agents represent buyers on more permanent basis

– _{Manufacturers’ agents are most common}

Types of Wholesalers

 _{Manufacturers’ Sales Branches and} Offices

– Wholesaling by sellers or buyers themselves rather than through independent wholesalers.

Wholesaler Marketing

Decisions

 _{Wholesaler Strategy:}

– Target market

– Service positioning

 _{Wholesaler Marketing Mix:}

– Product assortment and services

– Price

– Promotion

Trends in Wholesaling

 _{Fierce resistance to price increases.}

 _{Winnowing out of suppliers who are not}

adding value based on cost and quality.

 _{Distinction between large retailers and}

wholesalers is blurry.

 _{Will continue to increase the services}

provided to retailers.

Rest Stop:

Reviewing the Concepts

1. Explain the roles of retailers and

wholesalers in the distribution channel.

2. Describe the major types of retailers and give examples of each.

3. Identify the major types of wholesalers and give examples of each.

4. Explain the marketing decisions facing retailers and wholesalers.

Types of Wholesalers



_{Merchant Wholesalers}

– Largest group of wholesalers

– Account for 50% of wholesaling

– Two broad categories:

• Full-service wholesalers

Copyright 2007, Prentice Ha ll, Inc.

11-19

Types of Wholesalers



_{Brokers and Agents}

– Do not take title to goods

– Perform fewer functions

– Brokers bring buyers and sellers together

– Agents represent buyers on more permanent basis

– _{Manufacturers’ agents are most common}

Types of Wholesalers



_{Manufacturers’ Sales Branches and}

Offices

– Wholesaling by sellers or buyers themselves rather than through independent wholesalers.

Copyright 2007, Prentice Ha ll, Inc.

11-21

Wholesaler Marketing

Decisions



_{Wholesaler Strategy:}

– Target market

– Service positioning



_{Wholesaler Marketing Mix:}

– Product assortment and services

– Price

– Promotion

Trends in Wholesaling



_{Fierce resistance to price increases.}



_{Winnowing out of suppliers who are not}

adding value based on cost and quality.



_{Distinction between large retailers and}

wholesalers is blurry.



_{Will continue to increase the services}

provided to retailers.

Copyright 2007, Prentice Hall, Inc. 11-23

Rest Stop:

Reviewing the Concepts

1. Explain the roles of retailers and

wholesalers in the distribution channel.

2. Describe the major types of retailers and give examples of each.

3. Identify the major types of wholesalers and give examples of each.

4. Explain the marketing decisions facing retailers and wholesalers.