BUA370 Chapter 17: Retailing and Multichannel Marketing

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Multichannel strategy
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Selling in more than one channel (e.g., stores, Internet, catalog).
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What are the factors manufacturers should consider when developing strategies for working with retailers?
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1. Choosing retail partners 2. Identifying types of retailers 3. Developing a retail strategy 4. Managing a multichannel strategy
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Considerations associated with choosing retail partners
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1. Channel structure; the degree to which the channel is vertically integrated. 2. Customer expectations; retailers should know consumer preferences regarding manufacturers. They should also know where their target consumers expect to find their products and those of their competitors. 3. Channel member characteristics; generally larger, sophisticated channel members are less likely to use supply chain intermediaries
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Distribution Intensity
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The number of channel members to use at each level of the marketing channel. distribution intensity is commonly divided into three levels: intensive, exclusive, and selective
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Intensive distribution
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A level of distribution intensity whereby a firm tries to place its products and services in as many outlets as possible.
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Exclusive distribution
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Granting exclusive geographic territories to one or very few retail customers so no other retailers in the territory can sell a particular brand. This can benefit manufactures by assuring them that the most appropriate retailers represent their products.
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Selective distribution
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This relies on a few selected retail customers in a territory to sell products. Like exclusive distribution, this helps a seller maintain a particular image and control the flow of merchandise into an area.
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Retail strategy using 4 P’s
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Product: offering assortments give customers choice. Price: price helps define the value and the service, sometimes image. Promotion: this can mean the difference between flat sales and a growing consumer base. Place: convenience is the key to success; an aspect being location.
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What are the benefits of stores for consumers?
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Browsing, touching and feeling products, personal service, cash & credit payment, entertainment and social experience, immediate gratification, and risk reduction.
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What are the benefits of internet and multichannel retailing?
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Deeper and broader selections, personalization in customer service and offerings, and expanded market presence.
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Challenges of mutlichannel retailing
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An effective multichannel operation requires an integrated CRM system, a consistent brand image across all channels, consistent pricing in various channels, and a supply chain that efficiently delivers merchandise to multiple channels.

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