Managing Retailer Flashcards
When working with retailers, waht do manufacturers lose control of?
- price
- interactio with customers
- display
- advertising
Retailer takes 80-90% of the marketing program
What 3 things do manufactureres want out of the relationship? What do retailers want? Summarized?
M:
1. low retail margins
2. high retail price
3. high retail advertising
R:
1. low wholesale price
2. low cost servicing
3. high manufacturer advertising
Summary: each want other to take on more of the big costs (partners but also competing for channel profit)
What are the ways to influence manufacturers?
1) change channel structure
2) franchise agreements
3) inclusive vs exclusive distribution
What does changing channel structure mean? What is an example?
vertically integrate!
= manuf own retailers (or retailer integrate backward ex: Costco to get Kirkland)
ex: Apple! decided to do own retailer because control the service, independent!
What are franchise agreements? What pay?
= independent entrepreneur pays to open store under franchiser’s brand/company
– pay fixed fee at start (100-200k) and a % of all sales (~2%)
Intensive distribution definition? Exclusive dist? Selective dist?
intensive = sell through ALL retailers (ex: Tide)
exclusive = sell only through ONE retailer (ex: Porshe only one dealership in YEG)
selective = balance - sell through some
What is the comparison for availability, margins, and service under the 3 distribution methods (intensive exclusive selective)?
—-> Avail. | Margins | Service
int: high | low | low
sel: med | med | med
excl: low | high | high
What are push vs pull ongoing management strategies?
Push = Manufacturers create incentive for retailer to carry product (pushing it to them), then they sell it to customers (promote it a lil more too)
Pull = Manuf direct advertise to consumers who go search for product in stores, which makes them want to carry the product so have been PULLed in
