2. NON STORE RETAILING
While only 10% of retail sales are made through
non-store channels, sales in non-store formats are
growing faster than store sales.
Non-store retailing is a form of retailing in which
sales are made to consumers without using stores.
3. The various types of non-store retailers are defined in terms of
the medium they are using to communicate with customers:
Electronic retailers use an interactive computer or computer-
like interface to communicate with customers.
Catalog and direct mail retailers communicate using printed
material.
Direct selling retailers communicate with customers through
a personal, face-to-face contact by a salesperson.
TV home shopping retailers use television.
Vending machine retailers have limited communications
through the display of the merchandise in the machine.
4. Most retailers offer consumers the convenience of selecting and
purchasing merchandise at a time and location of their choosing.
While non-store retailing provides unique convenience benefits
over in-store retailing, frequently consumers are not able to get
some important services provided by store-based retailers
including that they cannot touch and feel the merchandise, try it
on, attend sessions on how to use it, or have it altered prior to
purchase.
5. ELECTRONIC RETAILING
Electronic retailing is a retail format in which the retailer and
customer communicate with each other through an
interactive electronic network.
After an electronic dialog between the retailer and customer,
the customer can order merchandise directly through the
interactive network or by telephone and the merchandise is
typically delivered to the customer’s home.
The bandwidth of the Internet connection into most
household limits the interactivity and amount and quality of
information that can be presented.
6. ISSUES ABOUT SHOPPING ON THE INTERNET
1. Entertainment and Social Experiences
2. Safety
3. Ordering and Getting Merchandise
4. Assistance in Screening Alternatives
5. Providing Information to Evaluate Merchandise
6. Cost of Merchandise
Electronic retailing sales will grow only if the format
offers consumers advantages over the existing
retail formats.
7. 1.Entertainment and Social Experiences
In-store shopping can be a stimulating experience
for some people, providing a break in their daily
routine and enabling consumers to interact with
friends.
All non-store retail formats are limited in the degree
to which they can satisfy these entertainment and
social needs.
8. 2. Safety
Non-store retail formats have an advantage over
store-based retailers by enabling customers to
review merchandise and place orders from a safe
environment-their homes
9. 3. Ordering and Getting Merchandise
Electronic retailing, like most non-store retail formats,
enables consumer to order merchandise from any
location at any time of the day. However, consumers
usually have to wait several days to get the
merchandise. Thus, all non-store retailers suffer in
comparison to stores on this dimension.
The importance of getting merchandise immediately
to customers depends on the type of buying situation
and merchandise.
10. 4. Assistance in Screening Alternatives
Another potential, more significant, benefit of electronic
retailing, is the ability to have a search through a wide
range of alternatives and select a small group for the
customer to look at in more detail.
Search engines are computer programs that simply
search for and provide a listing of all
Internet sites selling a product category.
11. 5. Providing Information to Evaluate Merchandise (Cont.)
Using and interactive electronic communication channel,
retailers can respond to the customer’ inquiries just like a
sales associate would.
If information provided by the electronic database can be
frequently updated and will always be available, consumers
have advantages while store-based retailers have a very
difficult time retaining knowledgeable sales associates,
and in many cases it is not cost-effective for them to do so.
Electronic retailers can easily provide information to
have side-by-side comparisons of alternatives.
Customers in stores usually have to inspect each brand,
one at a time, and then remember different attributes
to make a comparison.
12. 6. Cost of Merchandise
Some experts suggest that electronic retailers will have
much lower costs than in-store retailers because electronic
retailers do not have to spend money building and
operating stores at convenient locations.
However, electronic retailers, or their customers, will have
higher costs of delivering small quantities of merchandise
to homes, as well as dealing with the high level of return,
and attracting customers to their websites.
13. THE 5 C’S OF E-RETAILING
Content - information needs
Communication – Consumers want dialogues via e-
mail, live chat, online survey etc.,)
Customer Care – variety of payment modes,
delivery, return options, security, privacy
Convenience – user friendly, easy navigation
Connectivity – site to site connectivity and user to
site connectivity
14. WHAT TYPE OF MERCHANDISE WILL BE SOLD
EFFECTIVELY BY ELECTRONIC RETAILERS?
In addition to the amount and presentation of information,
retail formats also differed in the type of information they
can present effectively. For instance, when purchasing
apparel, some critical information might be “look and see”
attributes like color and style, as well as “touch and feel
attributes” like how the apparel fits.
Based on the difficulty of providing “touch and feel”
information through non-store channels, one might
conclude that non-store retailers will not be able to
successfully sell merchandise with more important “touch
and feel” attributes like clothing, perfume,flowers, and
food.
15. KEYS TO SUCCESS IN ELECTRONIC RETAILING
Some critical resources needed to successfully sell
merchandise electronically are
(1) strong brand name and image,
(2) customer information,
(3) complementary merchandise and services,
(4) unique merchandise,
(5) the ability to effectively present information on the
web pages, and
(6) a distribution system to efficiently ship
merchandise to homes and receive returns.
