Successful Market Coverage Strategy- the Path to Retailers : A Study of the Bulgarian Office Products Retailers

Abstract: Recently many academic researchers have become interested in the retailers as part of the distribution channel. Today retailers have grown so influential, that sometimes they take the functions of the wholesalers. The retailers constitute the road for manufacturers to the end market. Therefore, knowing retailers’ decision variables and assortment considerations is important for manufacturers when designing upon their marketing strategies. The study is conducted with focus on the Bulgarian office products retail industry. The purpose of the present research is to get a deeper understanding of retailers’ assortment criteria and analyze how the latter relates to market coverage strategy. Retailers’ assortment criteria concern decision variables such as profitability and sales, economic conditions, assortment considerations, consumer evaluation, marketing, supplier characteristics, competitive considerations, distributive factors, tactical considerations. The meaning underlying the assortment criteria is applied for arguing what market coverage strategy would best serve the Bulgarian retailers of office products. The research is performed employing qualitative method, in particular, in-depth semi- structured interviews providing the possibility for a broad discussion. The results of the study revealed some common patterns pertaining to four main inductive categories including product, brand positioning, promotion and distributor’s attributes. The patterns corresponding to the categories were further related to the market coverage strategy alternatives, namely, intensive, selective and exclusive coverage strategy. The results of the study showed that the nature of the product requires considerable effort from the distributors’ side to persuade the retailers to become customers who are aware of the products’ attributes. In other words, the nature of the office products calls for certain knowledge and skills that the retailers have to gain in order to be successful as traders to their own customers and that can be best achieved if selective coverage strategy is employed. Further, the results of the study reveal that manufacturers of office products that would like to position their brands on the high quality dimension should pursue highly selective distribution as this creates a superior product image. The results of the study also show that greater selectivity is suitable since it guarantees that the retailers’ requirements related to promotion are met. Last, the authors suggest that higher degrees of selectivity is the most appropriate way for a manufacturer to follow the performance of distributors and thus, to ensure that the desired by the retailers distributor’s attributes are present.