Retailing and WholesalingObjectivesSlide 2DefinitionsSlide 5BusinessNowSlide 6RetailersRetailingSlide 10Slide 10Slide 12Slide 13Slide 13Slide 14Slide 16Slide 17Slide 18Slide 18Slide 20Slide 21WholesalingSlide 23Slide 24Slide 25Slide 26Slide 26Slide 28Slide 29Slide 30Slide 31Retailing Retailing and and WholesalingWholesalingChapter 14Chapter 1414- 2ObjectivesUnderstand the roles of retailers Understand the roles of retailers and wholesalers in the marketing and wholesalers in the marketing channel.channel.Know the major types of retailers.Know the major types of retailers.Know the major types of Know the major types of wholesalers.wholesalers.Understand the marketing decisions Understand the marketing decisions facing retailers and wholesalers.facing retailers and wholesalers.14- 3Huge product Huge product assortment assortment Prices are 20%–30% Prices are 20%–30% below hardware storesbelow hardware storesObsessed with offering Obsessed with offering high quality customer high quality customer serviceserviceLifetime value of Lifetime value of customers: $25,000customers: $25,000Well-trained, highly Well-trained, highly motivated salespeople earn motivated salespeople earn above average salariesabove average salariesCustomer problem-solving Customer problem-solving is encouragedis encouragedInternet site offers many Internet site offers many home improvement tipshome improvement tipsOne of today’s most One of today’s most successful retailerssuccessful retailerscHome DepotHome Depot14- 4DefinitionsRetailingRetailingAll activities involved All activities involved in selling goods or in selling goods or services directly to services directly to final consumers final consumers for their personal, for their personal, nonbusiness use.nonbusiness use.14- 5DefinitionsRetailerRetailerBusiness whose Business whose sales come sales come primarilyprimarily from from retailing.retailing.Can be brick and Can be brick and mortar, 100% mortar, 100% virtual, or click virtual, or click and mortarand mortar14- 6ZanyBrainy.com Video ClipZanyBrainy.com is a click and mortar toy retailer.BusinessNowClick the picture above to play video14- 7How is web How is web retailing retailing different? In different? In your opinion, your opinion, what “works what “works on the web” on the web” that won’t work that won’t work in a typical in a typical store?store?Discussion Question14- 8RetailersTypes of RetailersTypes of RetailersSpecialty StoresSpecialty StoresDepartment Department StoresStoresSupermarketsSupermarketsDiscount StoresDiscount StoresConvenience Convenience StoresStoresOff-Price RetailersOff-Price RetailersSuperstoresSuperstores14- 9RetailingSelf-service retailersSelf-service retailersCustomers are willing to Customers are willing to self-serve to save moneyself-serve to save moneyDiscount storesDiscount storesLimited-service retailersLimited-service retailersMost department storesMost department storesFull-service retailersFull-service retailersSalespeople assist Salespeople assist customers in every waycustomers in every wayHigh-end department High-end department storesstoresSpecialty storesSpecialty storesAmount of Amount of serviceserviceProduct linesProduct linesRelative pricesRelative pricesOrganizational Organizational approachapproachRetailers are Retailers are Classified by:Classified by:14- 10RetailingSpecialty storesSpecialty storesNarrow product lines with Narrow product lines with deep assortmentsdeep assortmentsDepartment storesDepartment storesWide variety of product Wide variety of product lineslinesSupermarketsSupermarketsConvenience storesConvenience storesLimited lineLimited lineSuperstoresSuperstoresSell food, nonfood, and Sell food, nonfood, and servicesservicesCategory killersCategory killersGiant specialty storesGiant specialty storesAmount of Amount of serviceserviceProduct linesProduct linesRelative pricesRelative pricesOrganizational Organizational approachapproachRetailers are Retailers are Classified by:Classified by:14- 11Outlet malls and category complete are popular with consumers14- 12RetailingDiscount storesDiscount storesLow margins are offset Low margins are offset by high volumeby high volumeOff-price retailersOff-price retailersIndependent off-price Independent off-price retailersretailersTJ Maxx, Marshall’sTJ Maxx, Marshall’sFactory outletsFactory outletsLevi Strauss, ReebokLevi Strauss, ReebokWarehouse clubsWarehouse clubsSam’s Club, CostcoSam’s Club, CostcoAmount of Amount of serviceserviceProduct linesProduct linesRelative pricesRelative pricesOrganizational Organizational approachapproachRetailers are Retailers are Classified by:Classified by:14- 13RetailingCorporate chain storesCorporate chain storesCommonly owned/controlledCommonly owned/controlledVoluntary chainsVoluntary chainsWholesaler-sponsored groups Wholesaler-sponsored groups of independent retailersof independent retailersRetailer cooperativesRetailer cooperativesGroups of independent Groups of independent retailers who buy in bulkretailers who buy in bulkFranchise organizationsFranchise organizationsBased on uniquenessBased on uniquenessMerchandising conglomeratesMerchandising conglomeratesDiversified retailing lines Diversified retailing lines under central ownershipunder central ownershipAmount of Amount of serviceserviceProduct linesProduct linesRelative pricesRelative pricesOrganizational Organizational approachapproachRetailers are Retailers are Classified by:Classified by:14- 14Figure 14-1: Retailer Marketing Mix Decisions14- 15The product assortment, the services The product assortment, the services mix, and the store atmosphere are mix, and the store atmosphere are used by retailers to differentiate their used by retailers to differentiate their business from the competition.business from the competition.Select two retailers from your local area Select two retailers from your local area and discuss how each store differs with and discuss how each store differs with respect to the three variables above.respect to the three variables above.Discussion Question14- 16Retailer Marketing MixRetailer Marketing MixPricePrice High markup or high volume?High markup or high volume?PromotionPromotion Public relations, sales promotions, Public relations, sales promotions, advertising, direct marketingadvertising, direct marketingPlacePlace Location, location,