1 INTERNATIONAL MARKETING MANAGEMENT SESSION 12: INTERNATIONAL CHANNELS OF DISTRIBUTION

2 CHANNELS OF DISTRIBUTION BARRIERS TO STANDARDIZATION n Customer Shopping Patterns and Preferences n Competitor Control of Outlets n Structure of Distribution (Traditional vs. Advanced) n Regulation of Distribution

3 DIFFERENCES IN DISTRIBUTION FROM COUNTRY TO COUNTRY DOMINANCE OF ORGANIZED/MASS DISTRIBUTION (Supermarkets, Hypermarkets, Discounters, etc.) Role of Open Air Markets, Itinerant Retailers Importance of Small Independents LOCUS OF POWER Extent of Disintermediation Retailers as Channel Captains TECHNOLOGICAL SOPHISTICATION Computerized Inventory and Ordering Systems Use of Scanner Systems/Smart Cards Catalogue and In-Home Shopping Internet Sites

4 COUNTRIES DIFFER IN EVOLUTION OF THE RETAIL SECTOR l Multiplicity of formats l Competitive intensity l Retail productivity l Internationalization l Adoption of technology l Size of retail enterprise l Proportion of demand with organized retailers OPPORTUNITIES? Traditional China Greece India Mexico Argentina Malaysia Eastern Europe Emergent Brazil Italy Portugal Taiwan Spain South Korea Structured Belgium Japan France Denmark Netherlands Sweden Advanced Germany UK Canada USA

5 Shopping online isn’t as popular in Europe as in the U.S. and Japan, but the region should catch up by 2003 as more e-tailing sites pop up. Browsing for books is popular everywhere, but Europeans are more interested in travel deals.

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8 INTERNATIONAL RETAIL EXPANSION STRATEGIES Global Retailing Local Marketing/ Global Systems Global Marketing/ Local Systems IKEA C&ACarrefour Multinational Retailing Walmart (?) Adapted Standardized Centralized Decentralized Management Systems/ Operating Skills Product Assortment/Mix

9 GLOBAL RETAIL ASSORTMENT STRATEGIES Private-label Focus Few Product Categories Many Product Categories Manufacturer Brands Focus Toys R Us, Virgin Douglas, Spar, Vobis C Benetton, Ikea, Habitat, Gap, H&M, C&A A Marks & Spencer, Migros B Carrefour, Makro, Promodes, Yaohan D

10 IMPLICATIONS n Need to Adapt Channel Tactics to Differences in Distribution Patterns n Growth of Cross-Border Retailing and E-tailing n Technology Advances Impact Balance of Channel Power n Internet Sites as Alternative Channel