Basic Marketing: A Global Managerial Approach

Perreault−McCarthy: Basic

Marketing: A

Global−Managerial

Approach, 14/e

13. Retailers, Wholesalers
    and Their Strategy
    Planning

Text © The McGraw−Hill

Companies, 2002

372 Chapter 13

Department

stores

Variety stores

Supermarkets

Discount department stores

Mass-merchandisers

Fast-food outlets

Catalog showrooms

Supercenters

Single-line mass-merchandisers

Internet merchants

100 years

60 years

30 years

20 years

20 years

15 years

15 years

15 years

15 years

8 years

1850 1870 1890 1910 1930 1950 1970 1990 2010

Exhibit 13-4
Retailer Life Cycles—Timing
and Years to Market Maturity

We’ve seen that consumers’ needs help explain why some kinds of retailers devel-

oped. But we can apply the product life cycle concept to understand this process

better. A retailer with a new idea may have big profits—for a while. But if it’s a

really good idea, the retailer can count on speedy imitation and a squeeze on profits.

Other retailers will copy the new format or scramble their product mix to sell prod-

ucts that offer them higher margins or faster turnover. That puts pressure on the

original firm to change or lose its market.

Some conventional retailers are in decline as these life and death cycles con-

tinue. Recent innovators, like the Internet merchants, are still in the market growth

stage. See Exhibit 13-4. Some retailing formats that are mature in the United States

are only now beginning to grow in other countries.

Some manufacturers have always
had outlet stores near their
factories, but outlet malls are
emerging as a new retailing
format that is popular with some
consumers.

Product life cycle
concept applies to
retailer types too