The term Retail Channel refers to the sales channels created by a retailer to bring the sales directly into his store or place of business.
As defined in simple terms, the Retail Channel is the direct sales delivery channel created by the retailer and the supplier directly to the end-user. In today’s retail environment, the Retail Channel consists of different types of sales media. Such as stores displaying clothes and accessories, supermarkets displaying groceries and other grocery items, drugstores displaying medication and so on. These various types of Retail Channels constitute the Retail Channel and play a significant role in the successful management of any retail business.
The Retail Channel is highly flexible.
This means that it can be tailored to suit the particular needs of the Retail Store. For instance, a drugstore may display a complete range of branded medicine meant exclusively for their customers and not displayed in any chain outlets. This gives the customer a chance to buy medicine which he otherwise would not have. On the other hand, a chain retailer may display only a small collection of the top brands in the market thereby keeping the costs to the minimum.
A retail outlet thus, plays an important role in the overall retail industry. It not only helps to improve the sales but also helps in retaining customer loyalty. Many customers prefer to buy from only those stores where they personally visit and transact their business. Thus, an established retail outlet can effectively communicate its quality standards to its customers by using the Retail Channel. It can effectively promote the sale of products and services to the end-user thereby achieving the target of raising the customer base.
The main aim of the Retail Channel is to make the sale of a product easier.
This type of channel ensures that customers are offered with a wide range of choices and are not forced to choose a product based on its brand name. This allows for greater flexibility in the pricing of the product. Since most of the items offered for sale in the Retail Channel are of the same type, the customer enjoys greater purchasing flexibility. This type of retail channel therefore offers end-users greater purchasing power.
Another great advantage of the retail outlet is that it can help to promote a company in a non-traditional manner.
Since most goods sold in a retail store are sold face-to-face, a company can make its brand and name known to the end-user directly. In this way, the retail outlet not only helps to increase the sales of a particular product but also acts as a medium through which the company’s promotional campaigns can be conducted. For instance, if a company wants to offer discount cards to its customers, it can do so using the retail channel since most goods sold here are generally seen and handled. By doing so, the company is in a position to make its promotional campaign known to the targeted set of customers.
Furthermore, a retail outlet allows the company to sell its products directly to the end-user without having to depend on the distribution channels. This enables the company to control its prices and pass on the benefit of reduced distribution costs to the customers. Since the channel has a direct relationship with the consumers, it can act as a feedback mechanism whereby the customers inform the retailer of any possible problem or inconvenience and the retailer in turn takes appropriate steps to rectify the situation. This channel also enables the retailer to establish its brand in the market since it establishes the authority and credibility of the brand by providing goods at low cost.
Thus, apart from providing goods at a reasonable rate, the retail outlet also provides a platform for advertising the brand.
The retail outlet can therefore act as a brand building platform where one can advertise the brand and its products to the targeted audience directly. A retailer has a variety of options to choose from when it comes to advertising and promotion. This includes choosing the kind of media to advertise the product or service, determining the target audience and choosing the kind of products and services to be advertised. Thus, by acting directly on the consumer, the retailer helps to increase the sales of the brand in turn.
The above mentioned advantages have made the retail channel a very important and widely used channel in the retail industry. This is evident from the increasing number of outlets which are opening every day in the retail industry. By interacting directly with the consumer, the retail outlet helps to ensure that the customer gets value for their money. As such, it is considered to be the best marketing channel to promote brands.