Driven by expanded purchase options for shoppers, retailer-supplier relationships are changing radically. How will this play out within and between channels?
Growing shopper use of technology is changing the relationship between buyers and sellers in the same marketing channel. It’s also allowing innovators to test new business models. Increased competition within and among channels is likely to be one of the most profound effects that the technological revolution will have on retailing. How do you see changing retailer-supplier relationships playing out in the following areas?
Conflict between suppliers and retailers
Target is demanding that their suppliers provide unique products that can’t be compared directly with those sold by online retailers, and plenty of retailers are looking at this type of insulation if they can get it.
Competition between channels
Amazon’s move into book publishing directly challenges the publishing industry. They want to cut out the middleman entirely by changing the revenue split
- From 50% to publishers, 20% to authors, and 30% to retailers
- To 55% to retailers/publishers (Amazon) and 45% to the author.
Interestingly, this is exactly Walmart’s vision for working directly with some of the best produce suppliers, making them the single connection between farmer and consumer.
Shopper options for purchasing similar/identical products
TrueCar is just the latest price comparison tool for shoppers, there are many, many more. How will shopper options for purchasing similar items change? How will shopper behavior evolve?
This discussion is now closed.
Special thanks to participants: Dave Carlson, Mike Buege, Dan Raftery, Tom Lemke, Paul Sabuttus, Bobby Martyna, Mike Spindler, Dave Bishop, and Larry Mortimer.