Principles of
Marketing
Lecture-30
Summary
of
Lecture-29
Producer
Marketing
activities
Intermediaries
Demand
End users
Demand
Push Strategy
Marketing activities
Producer
Demand
Intermediaries
Demand
End users
Pull Strategy
Marketing Logistics
and Supply Chain
Management
Functions of
Logistics Systems
Costs
Minimize Costs of
Attaining Logistics
Objectives
Order Processing
Submitted
Processed
Shipped
Logistics
Transportation
Water, Truck, Rail,
Pipeline & Air
Functions
Warehousing
Storage
Distribution
Inventory
When to order
How much to order
Just-in-time
Today’s Topics
Retailing
and
Wholesaling
Retailing
Retailing is the
process by which
goods and services
are sold to
consumers for their
personal use.
Retailers provide many benefits
such as:
–providing an assortment of
merchandise under one roof,
–allowing access to goods
customers might never see,
–providing interesting
environments in which to
spend our leisure time.
Retailing can be done in stores
(store retailing) or out of a store
(nonstore retailing) such as:
–Direct mail,
–Catalogs,
–Telephone,
–Home shopping shows,
–Internet.
“...all activities involved in
selling, renting, and
providing goods and
services to ultimate
consumers for personal,
family or household use.”
-Berkowitz et al
Classification of
Retailing
Amount of Service
Self-Service, Limited-Service and
Full-Service Retailer
Product Line
Length and Breadth of the Product
Assortment
Relative Prices
Pricing Structure that is Used
by the Retailer
Retail Organizations
Independent, Corporate, or Contractual
Ownership Organization
Amount of
Service
Self-Service
Retailer
Limited-Service
Retailers
Provide Few or No
Services to
Shoppers
Provide Only a Limited
Number of Services
to Shoppers
Full-Service
Retailers
Retailers that Provide a
Full Range of Services
to Shoppers
Product Line
Specialty Stores
Narrow Product Line, Deep Assortment
Department Stores
Wide Variety of Product Lines i.e. Clothing,
Home Furnishings
Supermarkets
Wide Variety of Food, Laundry, & Household
Products
Convenience Stores
Limited Line of High-Turnover Convenience
Goods
Superstores
Large Assortment of Routinely Purchased
Food & Nonfood Products
Discount Stores
Standard Merchandise at Lower Prices
Off-Price Retailers
Changing Collection of Higher-Quality
Goods at a Reduced Price
Warehouse Clubs
Limited Selection of Brand-Name
Grocery Items, Appliances
Relative Prices
Discount
Stores
“Off-Priced”
Retailers
Catalog
Showrooms
Retail Organization
Corporate
Chains
Retailers
wanting economies
of scale
Corporate
Chains
Franchise
Operation
s
Retailers
wanting economies
of scale
Corporate
Chains
Franchise
Operations
Retailers
wanting economies
of scale
Voluntary
Chains
Cooperative
Chains
The Wheel of
Retailing
High Margin
High Price
High Status
Young
Store
Brand New Store
Older Store
Low Margin
Low Price
Low Status
Nonstore
Retailing
Mail Order
•Catalogs - from clothing to computers
•Direct Mail - brochure offering a product
or service at one point in time.
Direct Selling
•Door-to-Door Sales - declining in U.S.
•Parties & Networks - presentations
•Telemarketing - over the phone
Automatic Vending
•Best suited to inexpensive merchandise
and food and beverages.
Direct Response Television
•Home Shopping Networks - TV channels
that sell products
Retailer’s Product
Assortment and
Services Decisions
Product Assortment Decisions
• Width and Depth of Assortment
• Quality of Products
• Product Differentiation Strategies
Services Mix
Key Tool of Nonprice Competition
for Setting One Store Apart From
Another.
Store’s Atmosphere
• Physical Layout
• “Feel” That Suits the Target Market
and Moves Customers to Buy
Factors
Influencing Store
Atmosphere
Employee Type
and Density
Merchandise Type
and Density
Most
Influential
Factors on
Store
Atmosphere
Fixture Type
and Density
Sound
Odors
Visual Factors
Retailer Marketing
Decisions
Retailer Strategy
Target Market
Retail Store
Positioning
Retailer Marketing
Mix
Product
and Service
Assortment
Prices
Promotion
Place
(Location)
Strategic Issues
in Retailing
Location
Product Assortment
Customer Service
Atmospherics
Pricing
Promotion
Wholesaling
What is
Wholesaling?
All the activities involved
in selling goods and
services to those buying
for resale or business
use.
Wholesaler - those firms
engaged primarily in
wholesaling activity.
Services Provided
by Wholesaling
Intermediaries
Buying
Selling
Storing
Transporting
Providing Makret
Information
Financing
Risk Taking
Customer Expectations for
Wholesaling
Easy
Inquiry
and
Order
Error-Free
Invoicing
Accuracy
Reliable
Delivery
On-time
Delivery
Post-Sales
Support
Easy Claims
Handling
Suppliers’ Logistics Systems
Types of Wholesalers
Merchant
Wholesaler
Independently Owned
Business that Takes
Title to the
Merchandise
it Handles.
Brokers/ Agents
They Don’t Take Title to
the Goods, and They
Perform Only a Few
Functions.
Manufacturers’
Sales Branches
and Offices
Wholesaling by Sellers
or Buyers Themselves
Rather Than Through
Independent
Wholesalers.
Wholesaler Marketing
Decisions
Wholesaler Strategy
Wholesaler Marketing
Mix
Product and
Service
Assortment
Target Market
Prices
Retail Store
Positioning
Promotion
Place
(Location)
So….
Compete on value (not just
price.)
Save customers time and
energy.
Make shopping fun.
End of Place
part…..
Enough for
today. . .
Summary
Retailing
and
Wholesaling
Classification of
Retailing
Amount of Service
Self-Service, Limited-Service and
Full-Service Retailer
Product Line
Length and Breadth of the Product
Assortment
Relative Prices
Pricing Structure that is Used
by the Retailer
Retail Organizations
Independent, Corporate, or Contractual
Ownership Organization
Nonstore
Retailing
Mail Order
•Catalogs - from clothing to computers
•Direct Mail - brochure offering a product
or service at one point in time.
Direct Selling
•Door-to-Door Sales - declining in U.S.
•Parties & Networks - presentations
•Telemarketing - over the phone
Automatic Vending
•Best suited to inexpensive merchandise
and food and beverages.
Direct Response Television
•Home Shopping Networks - TV channels
that sell products
Wholesaling
Types of Wholesalers
Merchant
Wholesaler
Independently Owned
Business that Takes
Title to the
Merchandise
it Handles.
Brokers/ Agents
They Don’t Take Title to
the Goods, and They
Perform Only a Few
Functions.
Manufacturers’
Sales Branches
and Offices
Wholesaling by Sellers
or Buyers Themselves
Rather Than Through
Independent
Wholesalers.
Next….
Review
rd
3 P
(Place)
Principles of
Marketing
Lecture-30