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Example how to minimize vertical channel conflict

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Unformatted text preview: 17 Channel conflict Horizontal channel conflict ®What? ®Example? ®How to minimize? Vertical channel conflict ®What? ®Example? ®How to minimize? 18 Conclusion 70% of purchases are made in the store 70% (supermarkets), hence the paramount importance of good channel relations importance Coordination with channel partners is timeconsuming and complex, but rewarding A superior logistics system is an oftenoverlooked way to generate competitive overlooked advantage (e.g., Neste, Caterpillar) advantage 19 A Very Quick Look at Marketing from Retailers’ Perspective Retailer Retailer Strategy Strategy Target Market Target Market Retail Store Retail Store Positioning Positioning Retailer Retailer Marketing Mix Marketing Mix Product Product Prices Prices Promotion Promotion Place (location) Place (location) 20 Retailer’s Decisions on Assortment, r ou nd Service, and Store Environment Ba ck g • • • • Product assortment Width, length, depth, consistency Shelf space efficiency is key! Quality/style of products May differ by outlet type Services mix Key non-price differentiation tool Store environment • Store layout • Look and feel of the store • Store activities and experiences 21 Retailer’s Price, Promotion, and Place Decisions Price • Key decision is overall price image • EDLP or high/low pricing • Price may differ by outlet Promotion Branding Advertising Personal selling Price/nonprice promotions • Merchandizing • Catalogs • • • • Place Ba ck g ro un d • Location selection • Population density • Parking space • Number of competitors already in area (can be a good or a bad thing) • Choice of outlet type by location 22 The Wheel of Retailing New types of retailers find it New easiest to enter the market by offering goods at lower prices than competitors than Higher prices open the door Higher for a new entrant charging lower prices lower After they gain a foothold, After they gradually trade up, improving facilities and increasing the quality and assortment of merchandise, and offering special amenities; upscaling increases costs causing prices to rise causing 23 Key trends in the world of retailing Grrowth of non­store retailing, especially internet G owth of non­store retailing, especially internet Grrowing importance of retail technology G owing importance of retail technology Riise of “superpower” mega­retailer Rse of “superpower” mega­retailer Gllobal expansion of major retailers Gobal expansion of major retailers Rettail stores as “communities” or “hangouts” Re ail stores as “communities” or “hangouts”...
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