Retail Categories: Distribution Method

Retailers sell in many different formats with some requiring consumers visit a physical location while others sell to customers in a virtual space. It should be noted that many retailers are not tied to a single distribution method but operate using multiple methods.

  • Store-Based Sellers – By far the predominant method consumers use to obtain products is to acquire these by physically visiting retail outlets (a.k.a. brick-and-mortar). Store outlets can be further divided into several categories. One key characteristic that distinguishes categories is whether retail outlets are physically connected to one or more others stores:
    • Stand-Alone – These are retail outlets that do not have other retail outlets connected.
    • Strip-Shopping Center – A retail arrangement with two or more outlets physically connected or that share physical resources (e.g., share parking lot).
    • Shopping Area – A local center of retail operations containing many retail outlets that may or may not be physically connected but are in close proximity to each other, such as a city shopping district.
    • Regional Shopping Mall – Consists of a large self-contained shopping area with many connected outlets.
  • Non-Store Sellers – Under this approach, retailers sell products to customers who do not physically visit a retail outlet. In fact, in many cases customers make their purchase from within their own homes.
    • Online Sellers – The fastest growing retail distribution method allows consumer to purchase products via the internet and mobile devices. In most cases, delivery is then handled by a third-party shipping service.  However, other delivery options may require customers to pick up their order at a retail store or a lockbox.
    • Direct Marketers – Retailers that are principally selling via direct methods may have a primary location that receives orders but does not host shopping visits. Rather, orders are received via mail or phone.
    • Vending – While purchasing through vending machines does require the consumer to physically visit a location, this type of retailing is considered as non-store retailing as the vending operations are not located at the vending company’s place of business.
Retail Categories: Product Offerings
Retail Categories: Pricing Strategy