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Chapter 4: Retailing
1
MULTIPLE CHOICE
1. Kroger Co. is what type of retailer?
a. department store
b. specialty store
c. supermarket
d. warehouse club
PTS: 1 OBJ: LO: 14-2 TOP: AACSB: Reflective Thinking
KEY: CB&E Model: Strategy MSC: BLOOMS: Level I Knowledge
2. Which of the following is NOT one of the Ps of the retailing mix?
a. presentation
b. performance
c. personnel
d. price
PTS: 1 OBJ: LO: 14-5 TOP: AACSB: Reflective Thinking
KEY: CB&E Model: Strategy MSC: BLOOMS: Level I Knowledge
3. By adding the ClickList service, Kroger made adjustments to all of the following elements of
their retailing mix EXCEPT:
a. personnel
b. product
c. presentation
d. place
PTS: 1 OBJ: LO: 14-5 TOP: AACSB: Reflective Thinking
KEY: CB&E Model: Strategy MSC: BLOOMS: Level I Knowledge
4. Customers are commenting that the most important improvement to Kroger’s customer service
by the addition of ClickList is the:
a. minimization of wait times.
b. management of service capacity.
c. improvement to service delivery.
d. establishment of channel-wide network coherence.
PTS: 1 OBJ: LO: 14-6 TOP: AACSB: Reflective Thinking
KEY: CB&E Model: Strategy MSC: BLOOMS: Level I Knowledge
5. Kroger can use __________ gathered from ClickList orders to determine which products they
should keep more or less of in stock.
a. beacons
b. shopper marketing
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Chapter 4: Retailing
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c. click-and-collect
d. shopper analytics
PTS: 1 OBJ: LO: 14-8 TOP: AACSB: Reflective Thinking
KEY: CB&E Model: Strategy MSC: BLOOMS: Level I Knowledge
Great Ideas for Teaching Chapter 14
James S. Cleveland, Sage College of Albany
Discussion Board Topics to Encourage Participation
Discussion board questions provided to students to encourage them to engage in thinking and
writing about the content of the Principles of Marketing course usually take the form of a
provocative statement to which students are asked to respond. An example of this would be “All
PR is good PR.”
Discussion topics such as this one are abstract and often require that the instructor provide an
initial reply to show students what is expected of them in their own replies. For students with
limited work experience, this approach may be quite appropriate. For adult students with
extensive experience as employees and consumers, however, the abstract nature of such topics
can be frustrating.
Below are a series of discussion board questions to use with experienced, adult students. These
questions are designed to encourage them to use their experiences as employees and consumers
as doorways to better understand the course material, and to make their own responses more
interesting to themselves and to the other students in the class who will read and comment on
them.
Each question has three parts.
1. First, there is a sentence or two from the students’ textbook introducing the topic. By using
the text author’s own words, students are able to locate relevant material in the text easily,
the text content is reinforced, and confusion resulting from the use of variant terms or
expressions is minimized.
2. Second, there is a reference to text pages the students should review before proceeding.
Since the goal of the exercise is for students to apply the course content to their own
experiences, reviewing the content first is important.
3. Third, there is a request for the students to think about or remember some specific situation
in their experiences to which they can apply the text material, and a question or questions
© 2018 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Chapter 4: Retailing
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for them to address in their replies.
Here are additional such discussion board questions developed for Chapter 14 of MKTG11. Each
is written to fit the same text cited above but could easily be rewritten and revised to fit another
text.
Series A
1. Organizations have three options for distribution intensity: intensive distribution, selective
distribution, or exclusive distribution.
2. Review the information about levels of distribution intensity from section 14-2 in your
text.
3. Then select a product you recently purchased. At what level of distribution intensity is this
product distributed? Why do you think this might be the case? Explain your answer.
Series B
1. Because consumers demand convenience, nonstore retailing is currently growing faster
than in-store retailing.
2. Review the information about nonstore retailing from section 14-5 in your text.
3. Then consider five recent purchases. Have any of them been through nonstore retailing? If
so, list the type of nonstore retailing that was used, and explain why you chose that method
over traditional stores. If not, classify the type of stores you purchased from and why you
chose those over nonstore retailing options.
David M. Blanchette, Rhode Island College
Franchise Expo
This exercise has several purposes. Directly, students have the opportunity to internalize and
apply concepts related to obtaining and operating a retail franchise. Secondarily, students can
After presenting information to the class about franchising, students are separated into groups.
Some groups are “franchisors,” and some are potential “franchisees.” The premise is that there
© 2018 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Chapter 4: Retailing
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Franchisors initially need to determine the franchise they have for sale. A common restriction
here is that the franchise cost must be relatively low, as the franchisee groups are recent college
graduates and of relatively modest means. Franchisors can invent franchises or sell existing
franchises (if preferred, the instructor may assign or give available franchises for sale).
Potential franchisees initially need to determine the types of businesses they are interested in
(and ideally have some qualifications for). Also, franchisees need to calculate how much they
This initial organizational phase can be accomplished in as little as half an hour or take as long as
the instructor deems appropriate (even months). Following the organizational phase, groups are
now ready to attend the franchise expo, where franchisors attempt to attract and provide
Following this informational phase, groups negotiate (during the expo in short exercises, at later
times in extended exercises) to form franchise contracts. The terms of this contract are
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Chapter 4: Retailing
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Finally, the negotiated contracts (as well as those negotiations that collapsed) should be
discussed in class. The selection criteria for both franchisors and franchisees should be addressed
first. Terms of negotiated and failed contracts can then be discussed. This tends to be fascinating,
This exercise is most appropriate for retail management classes, but may also be used for other
marketing and management classes.
Chris Pullig, Louisiana State University
Retail Profits: No Room for Error
In discussing the small profit margin accomplished by many retail firms, it can be found that
most students do not stop and think about what a 3 percent to 5 percent profit margin really
One way to demonstrate how slim retail margins are is to use real money and mock invoices for
the expenses normally encountered. There is no better illustration of how delicate and difficult it
For this illustration, use $100 in cash and three student volunteers. One could use play money if
necessary with the understanding that students can trade the play money profits for real cash at
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Chapter 4: Retailing
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The students come to the front of the room where I would buy an apparel item (e.g., a sports
jacket) for $100 in cash. I give the $100 to one of the two partners, but at the same time I give
Cost of merchandise $50
Markdowns on other goods $10
Each invoice provides an opportunity to discuss a cost issue and possible strategic alternatives.
For instance, the cost of merchandise indicates only a 50 percent initial markup; perhaps the
students should have tried for a higher markup. The markdowns on other goods and advertising
John T. Drea, Western Illinois University
Mandeep Singh, Western Illinois University
Analyzing Retailing on the Internet
The Internet is an increasingly important marketing tool for a variety of products and services. It
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Chapter 4: Retailing
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is believed that students entering marketing careers in the coming years will need to know how
The assignment has two goals: first, to teach students how to use Internet search engines, and
How It Works
Students are assigned by the instructor to one of seven product or service categories. These
categories can include shoes, men’s clothing, women’s clothing, sporting goods, furniture,
financial products, and travel. (We match categories to student interests whenever possible.) The
assignment itself has three parts.
Part 1—Students are instructed to use a search engine to locate and compile a list of as many
Part 2—Next, students select five of the above sites and describe them in detail: What is the
Part 3—Finally, students are required to use the knowledge gathered from completing parts 1 and
2 to address each of the following questions:
a. What are the characteristics of a good website?
Assignments are graded according to the number of correct sites found relative to each product
category (i.e., we don’t expect a student assigned to furniture to find as many sites as one
assigned to travel), and the completeness of the descriptions in parts 2 and 3. We also spot-check
addresses to see if they are accurate—students lose points for each incorrect URL.
The Results
Follow-up research was conducted with two sections of introductory marketing students
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Chapter 4: Retailing
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involved in the assignment. The results indicated that the assignment met its stated goals. Nearly
all students (86.5 percent) indicated the assignment was a positive learning experience (a score
Mark B. Houston, Bowling Green State University
Beth A. Walker, Arizona State University
Bringing the Retail Mix to Life
When students are first introduced to the retail mix (store location, pricing, merchandise variety
and assortment, promotion and layout, and customer service and personal selling) in a Retail
Beyond providing a definition of the mix [i.e., “the combination of factors retailers use to satisfy
To facilitate involvement, students are asked to form groups (three to five students) and to
discuss and list specific responses to the following questions:
What distinguishes Gap from Walmart?
Why would anyone buy a Sunbeam toaster from Elder Beerman (a regional department
After 10 minutes or so, ask the class for their responses. Since most students have frequented all
of the retailers chosen, they have incorporated their personal insights into identifying the
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Chapter 4: Retailing
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Discussion of the questions regarding the toaster illustrates that it is not just the core product or
This type of activity is also very useful for introducing the marketing mix (the four Ps) in a
Principles of Marketing class.
Reference: Levy, Michael and Barton A. Weitz (1995), Retail Management. 2nd ed., Chicago:
Irwin.
Karen L. Stewart, Richard Stockton College
Retail Store Classifications
I have typically found it quite tedious to lecture on the various types of retail stores. This term I
decided to try a different approach. (I alerted the students prior to starting the retailing chapter
that it was important to read the chapter prior to coming to class since we would be doing an
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Chapter 4: Retailing
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Also, I attached several other handouts to the chart discussed above. One page was a floor plan
for a typical hypermarket. The other pages consisted of the following questions:
1 List anything you have purchased in the last few years from a direct mail offer. This would
include items purchased from so-called “junk” mail.
2 List items purchased via catalogs over the last few years.
I found that this approach took about the same total time as lecturing on retailing, but the overall
learning experience was more meaningful and interesting for the students.
© 2018 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
