INTERNATIONAL MARKETING
MANAGEMENT
SESSION 11:
INTERNATIONAL CHANNELS OF
DISTRIBUTION
1
CHANNELS OF DISTRIBUTION BARRIERS TO STANDARDIZATION

Customer Shopping Patterns and Preferences

Competitor Control of Outlets

Structure of Distribution (Traditional vs. Advanced)

Regulation of Distribution
2
DIFFERENCES IN DISTRIBUTION FROM COUNTRY TO COUNTRY
DOMINANCE OF ORGANIZED/MASS DISTRIBUTION
(Supermarkets, Hypermarkets, Discounters, etc.)
 Role of Open Air Markets, Itinerant Retailers
 Importance of Small Independents
LOCUS OF POWER
 Extent of Disintermediation
 Retailers as Channel Captains
TECHNOLOGICAL SOPHISTICATION
 Computerized Inventory and Ordering Systems
 Use of Scanner Systems/Smart Cards
 Catalogue and In-Home Shopping
 Internet Sites
3
COUNTRIES DIFFER IN EVOLUTION OF THE RETAIL SECTOR
Traditional
China
Greece
India
Mexico
Argentina
Malaysia
Eastern Europe







Emergent
Brazil
Italy
Portugal
Taiwan
Spain
South Korea
Multiplicity of formats
Competitive intensity
Retail productivity
Internationalization
Adoption of technology
Size of retail enterprise
Proportion of demand with organized retailers
Structured
Belgium
Japan
France
Denmark
Netherlands
Sweden
Advanced
Germany
UK
Canada
USA
4
Shopping online isn’t as popular in Europe as in the U.S. and Japan, but the region should catch
up by 2003 as more e-tailing sites pop up. Browsing for books is popular everywhere, but
Europeans are more interested in travel deals.
5
TOP 10 RETAILERS WORLD-WIDE
1999 Total Forecast Sales, in Billions of Dollars
Wal-Mart (U.S.)
$160.20
Carrefour/Promodes
Metro (Germany)
$78.97 pro forma
$60.82
Kroger (U.S.)
$43.56
Ahold (Netherlands)
$42.83
Intermarche (France)
$42.71
Carrefour (France)
$40.74
Ito Yokado (Japan)
$38.98
Albertson’s (U.S.)
$38.23
Promodes (France)
$37.37
Edeka (Germany)
$37.06
Source: Management Ventures
6
7
INTERNATIONAL RETAIL EXPANSION STRATEGIES
Product Assortment/Mix
Standardized
Global Retailing
Local Marketing/
Global Systems
IKEA
Walmart (?)
Global Marketing/
Local Systems
Multinational
Retailing
C&A
Carrefour
Centralized
Management Systems/
Operating Skills
Decentralized
Adapted
8
GLOBAL RETAIL ASSORTMENT STRATEGIES
Few Product Categories
Private-label
Focus
A
C
Benetton, Ikea, Habitat,
Gap, H&M, C&A
Toys R Us, Virgin
Douglas, Spar, Vobis
B
D
Marks & Spencer,
Migros
Carrefour, Makro,
Promodes, Yaohan
Manufacturer
Brands Focus
Many Product Categories
9
IMPLICATIONS

Need to Adapt Channel Tactics to Differences in
Distribution Patterns

Growth of Cross-Border Retailing and E-tailing

Technology Advances Impact Balance of Channel Power

Internet Sites as Alternative Channel
10