Question

What are the advantages and disadvantages of a store-based retailer adding a direct marketing operation? (300 words)

Answer 1

Direct Selling is a retail format where salesperson makes a personal contact with the ultimate consumers at his home or at his/her place of work. In this format, usually salesperson invites some friends or neighbours at his home, office or club and demonstrates the product after formal lecture/briefing. Buying and selling is done on the spot.

Following are the advantages of the direct marketing approach:

(i) Reduction in marketing cost

(ii) Reduced cost for seller

(iii) Lower prices for buyer

(iv) Source of earning

(v) Convenience for customers

(vi) Free from business formalities

A retail business provides a wealth of marketing opportunities, from sampling food products, to dressing rooms to try-on clothing to in-person advice and recommendations. These marketing strategies help sell retail items and develop relationships that can lead to repeat business. However, they can be expensive and require extra labor and infrastructure, such as staffing to hand out advice and samples, or extra floor space to install dressing rooms.

The Disadvantages of Working Retail

• Low Pay and Benefits. Comparatively low pay is common in retail, especially for those just starting out.
• Monotonous Tasks.
• Inconvenient Hours.
• Lack of Job Security.
• Dissatisfied Customers.
• Unpredictable Work Flow.