Page 261 - DMGT550_RETAIL_MANAGEMENT

Retail Management

Notes 14.8.1 Role of Web

It is a well-known fact that the retail industry always works on very narrow margins and the key
to survival lies in optimization of resources both in space and time dimensions as well as
maximization of customer satisfaction. Access to timely and even real-time information to a
wide variety of channel and trading partners, sales personnel, line managers, store managers
etc. is the key to achieving this. Web services technology holds out a lot of promise for the retail
industry in this respect. It is a platform-neutral, easy to deploy set of standards for achieving
business data and process integration, without going for proprietary point to point connections.
It promises to connect the information providers and information consumers across a wide
variety of platforms, devices and on an on-demand basis. Being based on service-oriented
architecture (SOA) principles it can also form the enabling service interface layer for other
emerging technologies like BAM, BPM, mobile and RFID.

Task Discuss about the Role of Web.
14.8.2 Online Retailing - Advantages

E-tailing offers unique advantages to the consumer that no other form of retailing can match.
The hypertext nature of the medium allows for more flexible forms of transactions (growth of
C2B and C2C) to flourish. It allows for easier comparisons across broad product categories with
the evolution of shopping bots and similar mechanisms. The medium also offers flexible/
dynamic pricing mechanisms to the consumer. These evolutions reduce any friction in the
online market place and stimulate the use of the web as a retail environment. In the long-run,
this will benefit the marketers as well as the consumers. Further, this will penalize the marketers
who thrived in market places that had entry barriers in the form of a lack of freely available
information. Earlier, such a situation restricted the customers in making informed choices and
led to inefficient pricing and localized monopolies.
Reasons for e-tailing coming up as a hot avenue in the retail sector can be attributed to multiple
factors such as:

No Real Estate Costs

E-tailing does not require a retailer to invest in warehouses, showrooms or other commercial
properties at prime locations. They operate through their web sites and thus save drastically on
the real estate costs. The real estate costs in the metropolitan cities can be prohibitively high.
Moreover, maintenance costs of a virtual store are negligible in comparison to a physical store.

Easy and Comfortably

The Internet offers easy and comfortable access to all the required information by a customer.
Over the Internet, product information is just a few clicks away, easily accessible from the
comfort of a home. Traditional retailing is quite cumbersome in contrast to e-tailing. It involves
frantic search for the required product, running up and down the retail store, asking the poorly
trained store assistants for help. The process involves significant wastage of valuable time.
Simply put, shopping on the Internet for fifteen minutes is equivalent to a two-hour trip to the
mall. Consumers prefer to save their precious time so that they can better utilize it.

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