Essay Sample on Multichannel Pricing

Introduction

Managing consistent pricing across multichannel is very challenging for retailers because of the cost structure of each channel and consumer expectation. Retailers need to adapt a multichannel pricing strategy such as self-matching price across all channels to remain competitive and maximize profits (Kireyev et al., 2017). However, retailers can choose to operate with price differences between channels because of the high margin differences to get rid of the surplus, customers' buying habits and the comparative platforms each channel offers for marketing and promotional activities.

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Outdoor Recreation Site

I will include merchandise such as outdoor clothing, fitness gear, camp and hike gear, snow gear, travel gear such as a backpack, sleeping bags, helmets, and hydro-flasks. I will provide information such as the best places to visit, the great outdoor activities, adventure programs, and safety regulations. I will pick a retailer selling outdoor merchandise such as Patagonia or REI to run the site because of their experience in selling outdoor gear, targeting people who enjoy outdoor recreation activities and their vast knowledge in dealing with outdoor activities.

Segmentation Characteristics of Nintendo Wii

Segmentation is usually based on consumer behavior, the status of the user and the rate of use. Before the launch of the Nintendo game, segmentation was based on serious gamers, and it also targeted new segments for non-casual gamers. Nintendo offers diversity to its customers by providing different products. Nintendo Wii applies the environmental influences of individual attributes such general cognitive development and performance to produce the best product in the market (Northouse, 2018).

Growth Opportunities and Profitability for Amazon.com

Amazon.com can only compete well in non-perishable food items in a small size that can be shipped easily as books because of positioned competitors. For apparel items, there are many players in the market, and it can only succeed for one stop shop customers. Growth opportunities for DVDs will be profitable because customers will be comfortable purchasing over the Internet. It will face competition from available movie downloads. For software business, the low costs of distribution and operations will make this business profitable, and larger software manufacturers such as Microsoft and Adobe may use Amazon.com for expansion to market segments. Amzon.com may attract a larger customer base by offering travel services. Some of the competitive advantages Amazon.com has over its competitors are in an excellent position of the brand by targeting a niche market, instant access, and comprehensive selection, low prices, unique set of activities and return policies (Zhu & Liu 2018).

Neiman Marcus and Wal-Mart

Wal-Mart will have a lower gross margin because they sell goods with predictable sales targeting price-conscious customers offering low discounts and limited customer service. Neiman sells fashionable products that require customer service which adds to their expenses. Wal-Mart's expense to sale ratio would be higher due to the many stores they operate. The inventory turnover of Wal-Mart would be higher because of the limited assortment of goods that benefit from just-in-time inventory systems. The asset turnover of Neiman will be lower because they deal with credit cards, unlike Wal-Mart where most sales are made in cash. With regards to largest profit margin, the stores have different cost of taxes and interest, but Wal-Mart may have a higher net profit margin percentage because it is the world's largest and most successful retailer.

References

Kireyev, P., Kumar, V., & Ofek, E. (2017). Match your own price? Self-matching as a retailer's multichannel pricing strategy. Marketing Science, 36(6), 908-930. Retrieved from; https://www.hbs.edu/faculty/Publication%20Files/15-058_9db37061-42bd-492f-96be-5e3cc2473a7c.pdf

Northouse, P. G. (2018). Leadership: Theory and practice. London. Sage publications. Retrieved from; http://fliphtml5.com/lnym/ezlr

Zhu, F., & Liu, Q. (2018). Competing with complementors: An empirical look at Amazon. com. Strategic Management Journal, 39(10), 2618-2642. Retrieved from; https://pdfs.semanticscholar.org/00ae/a4662c7568f358c1e8b3e672b293faf90239.pdf