Retailing Chapter 6

Front 1

What is the largest type and fastest growing type of non-store retailing?

Back 1

The fastest-growing form of direct marketing involves electronic (Web-based) retailing. From sales of $500 million in 1996 and $50 billion in 2001, Web retailing s expected to reach revenues of $150 billion in 2006.

Front 2

What are the two categories of direct marketing?

Back 2

1.) General Direct Marketing
2.) Specialty Direct marketing

Front 3

General direct marketing.

Back 3

offer a full line of products and sell everything from clothing to housewares

Front 4

Specialty direct marketing.

Back 4

focus on more narrow product lines.

Front 5

6 Strategic Business Advantages of direct marketing.

Back 5

-Many costs are reduced
-It is possible for direct marketers to have lower prices (due to reduced costs) than store-based retailers with eh same items.
-Customers shop conveniently.
-Consumers may sometimes legally avoid sales tax by buying from direct marketers not having retail facilities in their state.
-A store-based firm can supplement its regular business and expand its trading area (even becoming national or global) without adding outlets.

Front 6

6 Disadvantages of direct marketing.

Back 6

-Products cannot be examined before purchase.
-Prospective firms may underestimate costs.

-Even successful catalogs draw purchased from less than 10 percent of recipients.
-Clutter exists. Each year, billion of catalogs are mailed in the US alone.
-Printed catalogs are prepared well in advance, causing difficulties in price and style planning.

-Some firms have given the industry a bad name due to delivery delays and shoddy goods.

Front 7

What element is the key to successful direct marketing?

Back 7

a comprehensive customer data base

Front 8

7 Trends relevant to direct marketers.

Back 8

a.) Evolving activities of direct marketers

b.) Changing consumer life-styles

c.) Increased competition among firms

d.) Greater use of multi-channel retailing

e.) Newer roles for catalogs and TV

f.) Technological advances

g.) Mounting interest in global direct marketing

Front 9

8 steps in a direct marketing strategy.

Back 9

a.) Business definition

b.) Generating customers

c.) Media selection

d.) Presenting the message

e.) Customer contact

f.) Customer response

g.) Order fulfillment

h.) Measuring results and maintaining the data base.

Front 10

5 key issues facing direct marketers.

Back 10

1.) Many people dislike one or more aspects of direct marketing.

2.) Most people want less mail. (clutter)

3.) Privacy

4.) Multiple-channel retailers need a consistent image for both store-based and direct marketing efforts.

5.) Legal environment

Front 11

Direct selling.

Back 11

includes both personal contact with consumers in their homes (and other nonstore locations such as offices) and phone solicitations initiated by a retailer.

Front 12

FTC’s Telemarketing Sales Rule.

Back 12

Mandates hat firms must disclose their identity and that the purpose of the call is selling.

Front 13

What is the importance of ‘vending’ as a retailing format?

Back 13

It eliminates the use of sales personnel and allows 24-hour sales

Front 14

Where is almost all online retailing done?

Back 14

World Wide Web

Front 15

What are the 3 factors that designate the role a retailer assigns to the Web?

Back 15

1.) Whether its major goal is to communicate interactively with consumers or to sell goods and services;

2.) Whether it is predominantly a traditional retailer that wants to have a Web presence or a newer firm that wants to derive most or all of its sales from the Web;

3.) The level of resources the retailer wants to commit to site development and maintenance.

Front 16

6 Advantages of using the Web as a retailing format.

Back 16

1.)It is usually less costly to have a Web site than a store.

2.)The potential marketplace is huge and dispersed, yet relatively easy to reach.

3.) Web sites can be quite exciting, due to their multimedia capabilities.

4.) People can visit Web sites at any time, and their viits can be as short or long as they desire.
5.)Information can be targeted, so that, for example, a person visiting a toy store Web site could click on the icon labeled “Educational Toys—ages three to six.”

6.) A customer data base can be established and customer feedback obtained.

Front 17

6 disadvantages of using the Web as a retailing format.

Back 17

1.) Hard to find firm’ Web address.

2.)Many people are unwilling to buy online.
3.)Tremendous clutter.

4.) Web surfers are easily bored.

5.) The more multimedia features a Web site has, the slower it may be for people to access.

6.) Hard to coordinate store and Web transactions.

Front 18

6 Stages of developing a retail web presence.

Back 18

Stage 1: Brochure Web Site
-A site is built rapidly on a small budget. It may sell a few items but really exists to see if Web sales will work for the retailer. Customers are directed to the nearest store.

Stage 2: Commerce Web Site
-This site involves full-scale selling. It has customer service supports and described the retailer’s history and community efforts. It is not integrated with information systems. As a result, customers may order and later find an item is not in stock.

Stage 3: Web Site Integrated with Existing Processes
-The site is integrated with the firm’s buying, inventory, and accounting systems. That lessens the need to have separate reports an ensures that out-of-=stock items are automatically deleted from the site.

Stage 4: The “Webified” Store
-Network systems bring Web connectivity to browser based point-of-sale, kiosk, or in-store terminals. This lets the retailer sell items that are not being carried in a given store, directs customers to the items at other stores where they are available, enables Web-assisted sales, and provides information from manufacturer Web sites.

Stage 5: Site Integrated with Manufacturer Systems
-The site now combines all the information sources needed for collaborative sales. Manufacturers automatically replenish fast-selling items and ship directly to consumers, if so desired by the retailer.