Global Growth Opportunities: Where is Retail Heading?

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Do curso por IE Business School

Channel Management and Retailing

299 classificações

IE Business School

Channel Management and Retailing

299 classificações

Curso 3 de 5 em Specialization Marketing Mix Implementation

Nowadays a distribution strategy is part of the DNA of many companies and a correct channel management is key for the success of your product. Distribution plans need to be prepared for the long run, combining the following main areas: company profile, portfolio structure and price positioning, go-to-market policy, trade and retail marketing, e-commerce and global retail management. In the last decade, there have been two main revolutions that have affected industries, increasing the importance of Distribution Channel Management: • The IT revolution: considering developments in CRM, supply chain, planning tools, merchandise and reallocation systems, amongst others. • The retail focus: a clear retail strategy can be a differentiator for companies and a strong weapon of competitiveness. Stay up-to-date on how companies are adding these aspects to their main strategic guidelines and making them key points in their managerial decision-making process.

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Retailing Without Frontiers: New Trends in Retailing

At the end of this module you will be able to identify various growth opportunities for retailers and determine which entry strategies are best for various circumstances. You will also know the importance of a strategic online presence for retailers and future trends in retailing.

Global Growth Opportunities: Where is Retail Heading?7:02

Choosing the Right Country to Grow Your Business3:14

What are the Different Types of Entry Strategies?4:15

How to Implement a Successful Franchising Strategy3:13

Expert Interview: Eduardo Zamacola, President of Acotex & CEO of Neck & Neck6:46

Conheça os instrutores

Maria Teresa Aranzabal
Professor
Marketing

[MUSIC]

Does retailing have frontiers?

Today we will start to discover the new trends in retailing.

The environment is changing so much and so

fast that we can talk about retailing without frontiers.

What is going to happen?

What if we're retaining hearing?

Being globalization, one of the main characteristics of the new trend.

We will start by understanding the different types of growth and

strategy we can choose and apply.

If you want to be creative.

Today is your opportunity.

There are four types of growth opportunity that retailers may pursue,

market penetration, market expansion,

greet and formal development, and diversification.

We are going to present them in a graph.

Where the vertical axis indicates the synergies between the retailer's

present market and the growth opportunity, whether the opportunity involves

markets that retailer is presently pursuing or our new market.

In the horizontal axis indicates the synergies between the retailers

present retail mix and the retail mix of the growth opportunity.

What are the opportunities exploit?

The retailer's skills in operating its present format or

requires a new set of skills to operate.

Let us start to explain the different strategies.

A market penetration growth opportunity involves realizing

growth by directing a force to work, existing customers and

using retailers present retailing format.

It is the way most retailer are start.

This opportunity involves attracting customers from the current

target market that do not buy at this moment or

get the existing ones to visit us more often or make them buy more in each visit.

It can mean also opening more stores in the target market,

and keeping the existing ones open for longer hours.

Another issue can also displaying merchandise to increase impulse buying and

finally, also, training sales people to core selling.

That means, selling complimentary merchandise.

This is the typical strategy for example, that Starbucks applies.

If we talk about market expansion, the second strategy involves

using the existing retail format in new market settings.

It would be, for example, opening these stores in other regions or

other countries.

Recently, Amazon has opened in Spain.

As I mentioned before in another lesson, Prada is

currently in more than 90 countries.

The first strategy is greeted formal development,

it's an opportunity in which a retailer develops.

A new retail format with a different retail mix for the same target market.

Multichannel retailing is an example.

So we will talk for example about TESCO.

It operates several different food store formats

that target basically the same target market.

For example, Tesco Express is small stores,

3,000 square foot, located close to where the customer lives and work.

Then comes Tesco Metro.

It can go up to 15,000 square foot.

They are very conveniently located in the city center and

they do offer as well ready to eat meals.

Tesco Super Store up 50,000 square foot also offers non-food products.

And finally Tesco Extra, it has more than 60,000 square foot and

is a one-stop destination and offers food and non-food product.

And the fourth strategy is diversification.

Retailer operates a new retail format

directed to where a market segment that's not currently served by the retailer.

Diversification can be related.

That means that the retailer's current target market or retail format,

shares something in common with a new opportunity.

An example would be buying from the same vendor, opening in similar locations,

or using the same ID systems.

Most of the fashion groups like Inditex and Cortefiel operate this way.

And here, we can also mention the vertical integration.

That describes a diversification by retailers into wholesaling or

manufacturing.

The luxury industry, to control the process of production

they are very active in here.

At the end of 2015, Chanel for example, bought its supplier of footwear and

Hermes, their leather vendor.

Diversification can be also unrelated, that means that lacks

any commonality between the present business and the new business.

Typically, retailers have the greatest competitive advantage when they engage

In opportunities that are similar to the present retail strategy.

That means, that retailer will be more successful engaging in market penetration

opportunity that don't involve entering new market or operating new format.

The retail form of development opportunity needs to build

on the retailer's reputation and success with its present customer.

Multi-channel is the example and

when the retailers pursue a market expansion opportunity,

they are building on their strength in operating a retail format and

apply the competitive advantage, in a new market.

Again, international expansion is the main example here.

Now that we know what growth strategies we can use.

In the next lesson, we will learn how to evaluate this opportunities.

[MUSIC]

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