chapter
fifteen
retailing and
multichannel
marketing
McGraw-Hill/Irwin
Copyright © 2013 by The McGraw-Hill Companies, Inc. All rights reserved.
Retailing and Multichannel Marketing
LEARNING OBJECTIVES
LO1 Discuss the four factors manufacturers should consider as they
develop their strategy for working with retailers.
LO2 Outline the considerations associated with choosing retail
partners.
LO3 List the three levels of distribution intensity.
LO4 Describe the various types of retailers.
LO5 Describe the components of a retail strategy.
LO6 Identify the benefits of stores.
LO7 Identify the benefits of multichannel retailing.
LO8 Detail the challenges of multichannel retailing.
15-2
Home Shopping Network
15-3
Factors for Establishing
a Relationship with Retailers
15-4
Choosing Retail Partners
Channel Structure
Degree of vertical
integration
Manufacturers
brand
Power of
manufacturer and
retailer
©M Hruby
15-5
Choosing Retail Partners
Customer Expectations
15-6
Choosing Retail Partners
Channel Member Characteristics
Larger firms
Less likely to use
supply chain
intermediaries
Can gain more
control, be more
efficient, and
save money.
15-7
Intensive
©Jeff Greenberg/PhotoEdit
Choosing Retail Partners
Distribution Intensity
Selective
©Susan Van Etten/PhotoEdit
Exclusive
15-8
Distribution Intensity
Why might
Birkenstock choose
an exclusive
distribution
intensity?
Courtesy Birkenstock USA
15-9
check yourself
1. What issues should manufacturers consider
when choosing retail partners?
2. What is the difference between intensive,
exclusive, and selective levels of distribution
intensity?
15-10
Courtesy wwwadbustersorg
Retailer’s Reaction?
How do you expect
retailers would
respond to this?
15-11
Identify Types of Retailers
15-12
Food Retailers
Supermarket
Limited
nonfood
Differentiates
different
types of foods
Supercenter
Warehouse
Club
Convenience
Store
Includes
discount store
Limited
assortment
Limited
variety
Walmart,
Meijer,
K-Mart,
Target
Little service
Includes:
Costco, Sams,
BJ’s
Good
locations
Peapod Website
15-13
General Merchandise Retailers
Department Stores
Full-line Discount
Specialty
Drugstores
Category Specialist
Extreme value
Off-Price
•Broad variety and deep assortment
•Broad variety at low prices
•Limited merchandise with service in small store
•Specialty for pharmaceutical and heath
•Discount with narrow but deep assortment
•Full line, limited, very low prices
•Inconsistent assortment of brand name at low prices
15-14
Kmart and Sears
15-15
GNC Private Brands
Courtesy GNC Corporation
Courtesy GNC Corporation
15-16
check yourself
1. What strategies distinguish the different
types of food retailers?
2. What strategies distinguish the different
types of general merchandise retailers?
3. Are organizations that provide services to
consumers considered to be retailers?
15-17
Developing a Retail Strategy
Using the Four P’s: Product
AP Photo/David Kohl
Providing the right mix of
merchandise and services
15-18
Price
Courtesy DDB - London
Price defines the value of both the merchandise and the service provided
15-19
Courtesy Bass Pro Shops
AP Photo/MarkHumphrey
Promotion
Retailers use a wide variety
of promotions, both within
their retail environment and
through mass media
15-20
Place
©M Hruby
Convenience is a key
ingredient to success
The McGraw-Hill Companies, Inc/
Jill Braaten, photographer
15-21
Walmart Faces Biggest
Civil Rights Suits
15-22
Benefits of Stores for Consumers
Browsing
Touching and Feeling
Personal Service
Cash and Credit
Entertainment and Social Interaction
Instant Gratification
Risk Reduction
15-23
Benefits of the Internet
and Multichannel Retailing
Deeper and Broader
Selection
Personalization
Gain Insights into Consumer
Shopping Behavior
Increase Customer
Satisfaction and Loyalty
Expand Market Presence
15-24
Courtesy LL Bean
How does the Internet Improve
Multichannel Shopping?
15-25
Retailers can do more online…
Zafu Website
15-26
Perceived Risk in Internet Shopping
Courtesy Zafu
15-27
Effective Multichannel Marketing
Integrated
CRM
Brand
Image
Pricing
Supply
Chain
15-28
