chapter 3 part 2

4- Social Retailing

social retailing

Social retailing, or s-retailing, involves purchasing transactions through social media platforms like Twitter, Pinterest, and Instagram. These platforms use "buy buttons" to link users to external websites for purchases. Instagram uses similar functionality to Facebook's buy button, while Pinterest uses "buyable" pins to direct users to the merchant. Social retailing has grown from $3 billion in 2012 to an estimated $14 billion in 2015, with Facebook being the largest source of orders.

5- nonstore retailingcatalog channel/direct selling/automated retailig

catalog channel

retailers mail catalogues to their customers and maintain showrooms where samples of the products for sale are displayed is known as catalog retailing.Customers can choose a product given in catalog and order the same through telephone, mail or any other way as preferred by the retailer.

• Consumers can conveniently browse and place orders from anywhere, 24/7, without the need for a computer, mobile device, or internet connection.
• Consumers can access information from a catalog anytime by simply picking it up from the coffee table.
• catalogs can be easier to browse through than websites.

IKEAS adaptation to catalog retailing

IKEA has enhanced its catalog by incorporating augmented reality, allowing customers to interact with images, videos, and product information. The app allows users to download icons and interact with the catalog, allowing them to build in decorative elements and explore color options, enhancing the user experience.

Direct Selling

Direct selling is a nonstore channel where salespeople interact with customers face-to-face at a convenient location, demonstrating product benefits, explaining services, taking orders, and delivering merchandise. This highly interactive retail channel conveys significant information through face-to-face discussions and demonstrations, but providing this personalized information, including extensive demonstrations, can be costly.

• U.S. sales through direct selling are over $35 billion, with over 60% of products sold being home, family care, and home durables.
• 20 million salespeople in the U.S. working in direct sales are independent agents, acting as independent distributors who buy merchandise from firms and resell it to consumers.

Automated Retailing

Automated retailing is a non-store retail channel where goods or services are stored and dispensed to customers through cash deposits or credit card use. These vending machines, also known as vending machines, are located in high-traffic locations and account for about 80% of sales from cold beverages, prepared food, candy, and snacks. Annual U.S. sales in this channel exceed $6 billion.

OPPORTUNITIES FACING MULTICHANNEL AND OMNICHANNEL RETAILERS

Opportunities

Retailers are utilizing multiple channels to enhance customer experiences and gain a competitive edge. Evolution toward multichannel retailing are when store-based retailers and catalogers add Internet channels. Multichannel and omnichannel retailers can benefit from using various channels synergistically to promote services offered by other channels. This can be achieved through in-store signs, shopping bags, and print or broadcast advertising. Physical stores and catalogs can also serve as advertisements for other channels.

Opportunities

Apple has become the gold standard in omnichannel retail, offering a seamless experience across instore, online, and mobile. The company's store design, website, product design, and packaging reflect its brand's clean, sleek simplicity. Apple helps customers research products online, schedule appointments, and sign up for classes. Store associates use iPhones to assist customers, check out using credit cards or Apple Pay, and assist with customized Apple Watch purchases. Amazon, known for its internet channels, has opened a physical bookstore in Seattle and plans to open a second store in San Diego. The store features Amazon's Kindle, Fire TV, Fire Tablets, and Echo. Consumers want a seamless omnichannel experience, including recognition, assistance, and consistent information across various channels.

CHALLENGESFACING MULTICHANNEL AND OMNICHANNEL RETAILERS

Challanges

5 major challanges that faces most of multichannel and omnichannel retailers

Information systemissues

Merchandise assortment

Consistent brand image

Pricing issues

Channel migration

Multichannel and Omnichannel Supply Chains and Information Systems

Traditional distribution centers handle merchandise for stores differently than those supporting online, mobile, and catalog channels. Some use cross-docking for quick transfers, while others require repacking for individual online orders. These differences lead to separate organizational structures for store and online operations initially, but as retailers evolve, they often integrate these functions under one organization for a seamless multichannel or omnichannel approach. Examples include Walmart and JCPenney, which initially had separate teams but later merged their online operations with stores and catalogs.

Consistent Brand Image across Channels

Retailers need to provide a consistent brand image of themselves and theirmerchandise across all channels Maintaining a consistent brand image across various retailing channels can be challenging due to several factorsTo overcome these challenges, businesses need to invest in strong brand guidelines, establish clear communication channels, conduct regular audits, and empower teams with the right tools and training. Consistency requires a strategic approach and ongoing effort to ensure that the brand remains cohesive and impactful across all touchpoints.

Merchandise Assortment

Multichannel and omnichannel retailers offer a broader and deeper merchandise assortment through their internet channel, satisfying a wider variety of customer groups. They also differ in their effectiveness in generating sales for different types of merchandise. Store channels are better suited for selling products with touch-and-feel attributes, while internet channels can be just as effective for selling look-and-see attributes like price, color, Evaluating these products does not requiresenses beyond sight.

Pricing

Pricing represents another difficult decision for multichannel and omnichannel retailers. Many customers expect prices to be the same across channels. However, in some cases, retailers need to adjust their pricing strategy because of the competition they face in different channels.

Reduction of Channel Migration

Channel migration is when customers switch between different ways of interacting with a business, like moving from physical stores to online platforms.Internet channels assist customers in searching for product and price information, with most multichannel and omnichannel usage involving online searches and store purchases. However, if a retailer's channel is hosted by a competitor, channel migration can occur, leading to showrooming, where consumers learn about different brands and products in a store and search for the same product online at a lower price.

Reduction of Channel Migration

Three approaches that retailers can use to reduce showrooming

providing better customer service

promoting private-label merchandise that can be purchased only from the retailer.

offering uniquely relevant information based on proprietary data the retailer has collected about the customers

SUMMARY

Retail channels, including stores, the Internet, mobile, social, catalogs, direct mail, direct selling, and automated retailing, are used by retailers to sell and deliver products and services. Multichannel retailing offers multiple channels without integrating operations, while cross-channel retailing involves customers using multiple channels to make purchases. Omnichannel retailing provides a seamless and synchronized customer experience using all channels. However, retailers struggle to provide an integrated shopping experience across all channels due to unique skills and resources needed.

opportunities associated with a true omnichannel strategy.

retail channels: stores; Internet, mobile, and social; and catalog and other nonstore channels.

challenges facing multichannel and omnichannel retailers.

Understand the channels used by retailers