Chapter 13 - Chapter 13 Retailers and Wholesalers Plan...

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Chapter 13 Retailers and Wholesalers Plan Their Own Strategies Understanding the how and why of past changes in retailing and wholesaling will help you know what to expect in the future The Nature of Retailing Retailing covers all of the activities involved in the sale of products to final consumers o Some retailers operate from stores and others operate without a store-by selling online, on TV, with a printed catalogue, etc o Most sell physical goods produced by someone else o But in the case of service retailing (dry cleaning, fast food, photo processing, etc) the retailer is also the producer Retailing is crucial to consumers in every macro-marketing system Consumers spend about $4.5 trillion a year buying goods and services from US retailers The nature of retailing and its rate of change are generally related to the stage and speed of a country’s economic development Planning A Retailer’s Strategy Retailers interact directly with final consumers—so strategy planning is critical to their survival o Producers and wholesalers still make their sale regardless of which retailer sells the product In the US, about ¾ of new retailing ventures fail during the first year o To avoid this, a retailer should carefully identify possible target markets and try to understand why these people buy where they do In developing a strategy, a retailer should consciously make decisions that set policies on all of these marketing mix issues o A retailer must consider its target customers’ economic, social, and emotional needs If the combination doesn’t provide superior value to some target market, the retailer will fail Ex: o Offers a different marketing mix that appeals to a different target marker Retailers have an almost unlimited number of ways in which to alter their offering —their MMixes—to appeal to a TM o Because of all the variations, it’s oversimplified to classify retailers and their strategies on the basis of a single characteristic—such as merchandise, services, sales volume, or even whether they operate in cyberspace
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Conventional Retailers—Try To Avoid Price Competition About 150 years ago, general stores —which carried anything they could sell in reasonable volume—were the main retailers in the US Now most conventional retailers are single-line or limited-line stores —stores that specialize in certain lines of related products rather than a wide assortment o The main advantage of limited-line retailers is that they can satisfy some target markets better They build a relationship with their customers and earn a position as the place to shop for a certain type of product Expand Assortment and Service—To Compete At a Higher Price A specialty shop —a type of conventional limited-line store—is usually small and has a distinct “personality” o Sell special types of shopping products, such as high-quality sporting goods, exclusively clothing, cameras, or even antiques
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Chapter 13 - Chapter 13 Retailers and Wholesalers Plan...

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