Retail Management

Chapter 3 – Multichannel retailing

PART I: SHORT ANSWER QUESTIONS
1. From a customer's perspective, what are the benefits and limitations of
stores? Catalogs? Retail web sites?
STORES CATALOGS RETAIL WEB SITES
- Touching and feeling
merchandise - Safety Convenience
- Personal service - Broad and deep
- Safety
- Risk reduction assortments
BENEFITS - Convenience
- Immediate gratification - Extensive and timely
- Ease of use
- Entertainment and social information
interaction - Personalization
- Browsing Cash payment
- Return facilities in catalogs
are complex and
- Provide limited choice and cumbersome and have - Poor delivery or
options to select and limited stock. damaged products, and
LIMITATIONS purchase the product. - Once a catalog is printed, it customers are required to
- Expensive but inconsistent cannot be updated give personal details while
execution. economically with the latest placing orders.
price changes and new
merchandise.

2. Should a multi-channel retailer offer the same assortment of merchandise for

sale, at the same price, on its websites and in its stores? Why or why not?
- In general, a multichannel retailer should attempt to offer the same assortment of
merchandise, at the same prices, across all channels. A significant product overlap across
channels reinforces the "one brand" image in the customer's mind. However, significant
operating, competitive and regulatory considerations may contribute to differences in
merchandise and prices in a retailer's store as compared to its website.

- First, in terms of operating considerations, some retail providers may find lower costs of
operating and making a sale through the website. These lower costs can be passed on to
customers in terms of lower prices. Moreover, different assortments are appropriate for
each of the channels. The store channel is better suited for selling products with important
“touch-and-feel” attributes such as the fit of a shirt, the taste of an ice cream flavor, or the
 Retail Management

smell of perfume. On the other hand, an Internet channel might be just as effective as a
store channel for selling products with important “look and-see” attributes such as price,
color, and grams of fat. Evaluating these products does not require senses beyond sight.

- Second, retailers with stores in multiple markets often set different prices for the same
merchandise to deal with differences in a local competition.

- Third, sales tax regulations may force retailers to collect sales tax as well shipping and
handling charges from customers. Thus, customers would be charged higher delivered
prices through the Internet since they pay both the sales tax and shipping charges, while
customers visiting the physical store would pay only the sales tax.

3. What are the advantages to customers of accessing the Internet through a

mobile device or a computer when browsing a website? When learning
special promotions?
- The following are the advantages of accessing Internet through mobile phones or
computer while browsing:

 The Internet can be accessed from any place at any time

 The customer can get more information about the product
 The time and effort will be reduced in collecting information
 The customer will have wide and deep assortment. There would be more change to
pick the items of specific criteria

- The following are the advantages of using the mobile phone or Internet while learning
promotion:

 Mobile apps will be useful in learning about specific promotions such as discounts,
deals and offers on a product range
 The barcodes can be scanned using the mobiles and these are very helpful in
learning about the promotions of a particular product
 Store location can be identified easily when the store is accessed through phone or
internet

PART II: GET OUT AND DO ITS

1. Pick a merchandise category like microwave ovens, power drills, digital
cameras, blenders, or coffee makers. Compare a retailer’s offering in its local
store and its Internet site. What are the differences in the assortments offered
 Retail Management

through its store and Internet channel? Are the prices the same or different?
What has the retailer done to exploit the relationship between the channels?
- I selected Sharp R-205VN(S) microwave oven 20 liters on dienmayxanh.com and in the
store. I see a slight difference in the product price (95,000 VND) between the two
purchasing methods, which is 1,795,000 VND if buying on the website and 1,890,000 VND
if buying at the store. In my opinion, the way that Dien May Xanh has done to exploit the
relationship between the channels is that they put more discount vouchers when buying at
the store so that customers can feel the price difference is no longer obvious.

- Also, another difference is the availability between stores and online. To be clear, there
are more products on the website than in stores so there are many cases where customers
want to buy something at the store, but it is not available at that. Therefore, another way
that Dien May Xanh has done to exploit the relationship between the channels is that the
customer can ask Dien May Xanh to send the product they intend to buy. After the product
arrives, the customer can view the product directly at the store and then make a decision
whether to buy it or not. If they are not satisfied, they just need to pay the shipping fee for
the product without necessarily buying it.

2. Access the websites of Home Depot and Macy’s using your mobile phone and
computer. What are the differences in the ease of navigation when looking at
the presentation of merchandising using the two methods of accessing the
websites? (BACH HOA XANH & DIEN MAY XANH)
 BACH HOA XANH:

- The interface on the computer is designed with an extremely eye-catching layout, the
website banner is placed right below the search bar. Because it is in a position that catches
the eye of customers, it makes the homepage more perfect, attracting the maximum
attention of customers. Products are presented by product groups: meat, fish, seafood;
fruits and vegetables; drinks of all kinds; ... help customers easily choose the desired
product. A typical screen can show from 8 products clearly, presented in a scientific, vivid
and highly interactive way. With an improved interface, the website is currently displaying
more than 10,000 items for customers to admire and choose from. When choosing a
product, the necessary information for customers to make a decision is the most complete,
such as name, image, visual video, price, product description to customer reviews who have
purchased and used it

- For the interface on the phone, Bachhoaxanh.com shows from 9 clear products, the
product catalog is placed horizontally below the search bar compared to the interface on
 Retail Management

the computer. Thus, every space on the screen is utilized to the fullest extent. Older
customers who are not used to shopping online can still easily operate with
Bachhoaxanh.com because of the optimal design to help customers find items easily, and
the purchase and sale operation is short and convenient. The process from the time
customers visits the website to the time they choose the goods to buy needs the fewest
clicks. When choosing a product, information such as name, visual image, price is fully
displayed, but the product description is hidden from the interface on the computer.

 Overall, both interfaces are optimized for the customer, making navigation as
simple as possible.

 DIEN MAY XANH:

- For the interface on the computer: The product list is displayed in the top left corner of
the homepage and is divided into separate blocks containing the products that Dien May
Xanh is trading. Customers only need to mouse over the category name, the corresponding
products in that category will be displayed on the screen. Category banners are displayed
in the middle of the homepage with promotions, featured products. These banners are only
displayed on the computer interface and are changed according to new programs and
products of Dien May Xanh. The product catalog interface can display up to 10 items. When
choosing a product, the necessary information for customers to make a decision is
completely from name, image, visual video, price, product description to customer reviews
who have purchased and used it are fully.

- For the interface on the phone: Customers can see the featured categories displayed in
the top of the page, if they want to see all the business lines at Dien May Xanh, they must
click "View all". The website template is designed based on the structure of Bach Hoa Xanh
website, so it has a clear layout and user-friendly interface, helping users easily find the
products they need. If customers want to compare prices and technical information of
many products together, the mobile website will have a more difficult-to-see layout than on
a computer. Display up to 4 items on the interface. When choosing a product, all the
necessary information for customers to find out is as complete as a website on a computer,
but is streamlined and easier to observe.