Chapter 17 – Retailing and Multi-Channel Marketing Marketing 5th
Powerpoint Slides With Teaching Notes
Power Point Slide Teaching Notes
17-1: Retailing and Multichannel
Marketing
17-2: Learning Objectives These are the learning objectives for this
chapter.
17-3: H&M When H&M opened its flagship Times Square
store, it aimed to create not just the most
exciting store in the fashionable chain’s range
of locations but also perhaps the most
cutting-edge example of retail in the world.
Ask Students Do they shop at high-end
department stores like H&M. If so, then why.
If not, then why not.
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Chapter 17 – Retailing and Multi-Channel Marketing Marketing 5th
17-4: Factors for Establishing a
Relationship with Retailers
This is an overview and each stage is presented
on the following slides.
17-5: Choosing Retail Partners
Channel Structure
Ask students to describe what is meant by
“degree of vertical integration”.
This is given in chapter 15 and refers to a
supply chain where the members act as a
unified system.
Ask students how vertical integration affects a
manufacturer who is introducing a new product
and choosing a retail partner.
Students will mention that if the manufacturer
and retailer already have a relationship from
previous products that the retailer will be more
likely to accept the new product.
17-6: Choosing Retail Partners
Customer Expectations
Ask students how manufacturers determine
which retailers would be best for consumers?
Students will likely say focus group and
surveys.
They might also mention that sales reps within
the stores can supply information on products
that consumer request.
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in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 2
Chapter 17 – Retailing and Multi-Channel Marketing Marketing 5th
17-7: Choosing Retail Partners
Channel Member Characteristics
Larger firms often find that by performing the
channel functions themselves, they can gain
more control, be more efficient, and save
money.
17-8: Choosing Retail Partners
Distribution Intensity
Product characteristics drive supply chain
structures, in that mass merchandise products
use intensive distribution, whereas luxury
goods employ exclusive distribution.
Group activity: Match the following products
to their likely type of distribution:
Pharmaceuticals (selective)
Clothing (depends on the product type)
Soft drinks (Intensive)
17-9: Limited Distribution Birkenstock’s can only be purchased through
certain retailers – this helps control conflict
between retailers and gives the manufacturer
better control.
Some might argue that for products are the
later stages of the product life cycle, it implies
higher quality to the end consumer.
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Chapter 17 – Retailing and Multi-Channel Marketing Marketing 5th
17-10: Check Yourself 1. When choosing retail partners,
manufacturers must look at the basic
channel structure, where their target
customers expect to find the products,
channel member characteristics, and
distribution intensity.
2. An intensive distribution strategy is
designed to get products into as many
outlets as possible. Exclusive distribution
policy grants exclusive geographic
territories to one or very few retail
customers so no other customers in the
territory can sell a particular brand.
Selective distribution uses a few selected
customers in a territory.
17-11: Retailer’s Reaction? These kinds of grass roots movements are very
difficult for retailers.
They rarely get a strong enough following to
threaten retailers overall sales even if they slow
down a particular day of sales.
17-12: Types of Retailers This slide can be used as an introduction to a
detailed discussion of this topic or as a
shortened version.
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in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 4
Chapter 17 – Retailing and Multi-Channel Marketing Marketing 5th
17-13: Food Retailers Ask students: In what circumstances do you
shop at each type of food retailer?
How do the price, selection, and quality vary
across each type?
This web link is for peapod, an online grocer
(you might want to set up account in advance
of class).
Ask students if they have ever used this
service? Why or why not?
17-14: General Merchandise Retailers Group activity: Identify a retailer in each of
these categories.
Discuss how that specific retailer creates value
for its target consumers.
17-15: Kmart and Sears This video explores the giant K-Mart and Sears
and their quest to gain market share.
It examines the value the retailer brings to the
consumer and how the respective stores see
themselves in the market place.
Note: Please make sure that the video file is
located in the same folder as the PowerPoint
slides.
© 2015 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution
in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 5
Chapter 17 – Retailing and Multi-Channel Marketing Marketing 5th
17-16: GNC Private Brands GNC sells many brands including its own
products – private brands.
17-17: Services Retailers Several trends suggest considerable future
growth in services retailing.
For example, the aging population will
increase demand for health care services.
Younger people are also spending more time
and money on health and fitness.
Busy parents in two-income families are
willing to pay to have their homes cleaned,
lawns maintained, clothes washed and pressed,
and meals prepared so they can spend more
time with their families.
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in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 6
Chapter 17 – Retailing and Multi-Channel Marketing Marketing 5th
17-18: Check Yourself 1. Food retailers include:
a.Supermarkets: a self–service food store
offering groceries, meat, and produce with
limited sales of nonfood items, such as
health and beauty aids and general
merchandise.
b. Supercenters: the fastest growing
retail category, are large stores
(150,000–220,000 square feet) that
combine a supermarket with a full-line
discount Store.. By offering broad
assortments of grocery and general
merchandise products under one roof,
supercenters provide a one-stop shopping
experience.
c.Warehouse Clubs: large retailers (at least
100,000–150,000 square feet) that offer a
limited and irregular assortment of food
and general merchandise with little service
at low prices for ultimate consumers and
small businesses.
d. Convenience Stores: provide a limited
variety and assortment of merchandise at a
convenient location in 2,000–3,000 square
foot stores with speedy checkout. Milk,
eggs, and bread once represented the
majority of their sales, but now the
majority of sales come from gasoline and
cigarettes.
2. General merchandisers include:
e.Department Stores: carry a broad variety
and deep assortment, offer customer
services, and organize their stores into
distinct departments for displaying
merchandise.
f. Full-Line Discount Stores: offer a broad
variety of merchandise, limited service,
and low prices. Specialty Stores:
concentrate on a limited number of
complementary merchandise categories
and provide a high level of service in
relatively small stores. Specialty stores
tailor their retail strategy toward very
specific market segments by offering deep
but narrow assortments and sales associate
expertise.
g. Drugstores: specialty stores that
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Chapter 17 – Retailing and Multi-Channel Marketing Marketing 5th
17-19: Facilitating Retail Strategy
Using the Four P’s: Product
Ask Students: What is the most important
thing that retailers do? Answer: They provide
assortments to customers.
Group activity: divide the class into groups.
Tell them that the classroom represents a new
store. Have them identify a target market.
Ask them to decide what they are going to put
into the store. Have them consider both variety
(number of categories) and assortment (number
of SKUs within a category.)
17-20: Price Group activity continued: Now have them
decide the general price range for their store,
and justify their recommendation.
This YouTube web link (always check before
class) is for Build-a-Bear Workshop.
Even though this retailer is so focused on the
experience – they are sending a strong pricing
message with this ad.
Video: “Wal-Mart’s Profit Falls 15% on Higher
Costs”
Ask students why are Walmart’s Profits
Dropping?
Ask students what global factors are effecting
Walmart’s profits?
17-21: Promotion Discuss how promotions affect consumers’
perceptions of value, patronage intentions,
purchase, loyalty, and share of wallet devoted
to a particular retailer, both individually and in
combination.
Group activity continued: Tell the students
they have a fixed amount to spend on
promotion, including personal selling.
How would they divide up their promotional
dollar? Justify their recommendation.
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Chapter 17 – Retailing and Multi-Channel Marketing Marketing 5th
17-22: Place In retailing there are two aspects to “place.”
The first is location, and the second is supply
chain management.
Both are important.Location is important
because it is one of consumers’ most important
criteria in choosing a retailer and it is a very
long-term investment.
Group activity continued: Have students
choose a location and justify it.
Also, have them describe how they would
design their supply chain, i.e., use of
wholesalers versus distribution centers; direct
store delivery versus, delivery to distribution
centers; traditional warehouses versus
cross-docking, etc.
17-23: Wal-Mart Faces Biggest
Civil Rights Suits
This video brings up some additional concerns
for retailers.
Wal-Mart has had many issues with the way
they treat their employees.
Ask students if they are aware of any other
issues?
Note: Please make sure that the video file is
located in the same folder as the PowerPoint
slides.
17-24: Exploring Multiple Channel Options:
Benefits of Different Channels
Ask students what they like to buy in stores
vs. catalog vs. online?
Ask students: Have you ever started shopping
online, and then visited the store to make the
actual purchase?
What kind of product did you buy using this
method?
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in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 9
Chapter 17 – Retailing and Multi-Channel Marketing Marketing 5th
17-25: Internet Channel Shopping over the Internet provides the
convenience offered by catalogs and other
nonstory formats.
However, the Internet, compared with store
and catalog channels, also has the potential to
offer a greater selection of products and more
personalized information about products and
services in a relatively short amount of time.
It also offers sellers the unique opportunity to
collect information about how consumers shop
—information that they can use to improve the
shopping experienceacross all channels.
17-26: How does the Internet Improve
Multichannel Shopping?
The internet can supply research?
Ask students what information Home Depot
might gather research from web visits and how
they would use it?
Students might mention that they will search
for products that the company does not
currently stock.
They might see products that consumers
browse often but purchase little. For instance,
they might look for lamps quite often but this
is a low seller for Home Depot?
What is it about the product that makes people
come looking and leave not buying?
17-27: Retailers can do more online… This is NOT the online model but other way
retailers can add value through the web – they
can use it for PR and for delivering messages
to the consumer that they are not able to
deliver within the stores.
This web link is to H&M’s online video
regarding their CSR. The second web link is
for an online model at lands’ end (H&M no
longer offer theirs).
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in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 10
Chapter 17 – Retailing and Multi-Channel Marketing Marketing 5th
17-28: Perceived Risk in Internet Shopping Ask students when they are nervous to enter
their credit card information online?
How do they determine if a site is credible?
How do they feel about privacy?
17-29: Evolution toward Multichannel
Marketing
Ask Students: What problems might stores
and catalogs have with existing formats?
Students should mention that the stores have
limited floor space and have inconsistent
service from their salespeople.
A catalog is also limited in the pages they can
print and send AND it is difficult for them to
make changes one the catalog is sent and
printed.
© 2015 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution
in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 11
Chapter 17 – Retailing and Multi-Channel Marketing Marketing 5th
17-30: Check Yourself 1. Like other marketers, retailers perform
important functions that increase the value
of the products and services they sell to
consumers. These functions are classified
into the four Ps: product, price, promotion,
and place.
2. The relative advantages of the most
traditional retail channels are browsing,
touching and feeling products, personal
service, cash and credit payment,
entertainment and social experience,
immediate gratification, and risk reduction.
3. Consumers desire a seamless experience
when interacting with multichannel
retailers. However, providing this seamless
experience for customers is not easy for
retailers. Because each of the channels is
somewhat different, a critical decision
facing multichannel retailers is the degree
to which they should or are able to
integrate the operations of the channels.
© 2015 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution
in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 12