Module 11 – Place
1-For the first example, what were the main reasons that the firm reversed their decision and returned to their initial channel mix?
The main reason for reversing their decision and returning to their initial channel mix was not getting the real worth for their products by selling to such discount stores. The company feared losing its product’s integrity and not making much profit.
2- Do you agree with their decision?
I agree with their final decision because there was no benefit to expanding their channels and offering their product at a discount. Doing so would have resulted in low margins and compromised integrity.
3- In the second example, do you agree with their choice of channel for their new watches? Why?
No, I do not agree with this choice of channel as introducing a completely new brand name in their own stores will help in reducing the integrity of the brand and decrease sales. Loyal customers can also lose their trust in the brand.
4- Do you think that most of their existing jewelry stores will be willing to stick and sell these new watches?
Most of their existing jewelry stores will not be willing to stock and sell these new watches as this will affect the sales of expensive watches and will ruin their store reputation of being a store for luxurious watches
5- What other channels (retailers) should they also consider?
The company may consider promoting its new brand in discounted stores which fetch more customers who are price sensitive. They can also sell their watches to wholesale retailers.
Hey Katty, I would agree that most jewelry stores will not want to carry these new watches. Cheaper alternatives can compromise their reputation as conforming to discount trends. However, I am curious if customers would buy the watches because they present, again, a cheaper alternative to the other products sold in the store.
Hi Katy, I also agree with the final decision of the firm because they weren’t seeing an increase in their profitability. And for the second example I also agree that introducing a new brand in their existing stores isn’t a good idea. I like that you mentioned how it would affect their customers loyalty. As you said the brand should consider discount stores. I also think they should consider convenience stores.
Hi Katty,
I’m split on question Four. I agree many of the jewelry store would think long and hard about selling the cheaper watches. They could heavily impact the sales of smilier watches from other brands that are sold for a higher price, However, some stores might jump on the opportunity to sell the cheaper watches because they would be able to expand their customer base with lower prices.
Katty we almost share the same point of view regarding selling the jeans in the discount store, it doesn’t worth it and it may lose its product’s integrity and not making much profit.
Swiss watches also I disagree with making cheaper one.
HI Katty,
I totally agree in that stores should not be willing to sell the new watches because it affects the integrity of the brand as well as it affect sales and also that customer start to loose trust in the brand and start to purchase elsewhere.