Converse Chuck Taylors’ Distribution Channels and Pricing
The present discussion pertains to the distribution channels and pricing of innovative Converse Chuck Taylors. As the product exists as a part of Chuck Taylor’s line, the distribution for the brand has already been established. Therefore, the required set of actions is to identify them and fully take advantage of their existence in the promotion and sales of the new shoe. In the process of this discussion, two primary distribution pathways will be discussed, outlining their advantages and disadvantages.
First Distribution Model
Firstly, Converse uses the chain store model to promote its brand and deliver value to its customers. This means that, in practice, the brand has a number of stores managed by a central organization, with each of them focusing on selling exclusively converse products. This model of product delivery has long since become a staple of many businesses, especially those dealing with clothing products and footwear (Kapner, 2015). Due to its prolonged history of usage in this business sector, a chain story delivery model can serve as a reliable and simple way to connect with potential buyers (Kapner, 2015). Using this approach, an organization can directly sell its products without relying on third parties or other additional factors while also giving its customer base an opportunity to see what they buy for themselves.
In terms of advantages, research is detailed on the proposed benefits of this style of product delivery. As noted by the Wall Street Journal, a chain store approach is both flexible and effective at targeting people of varied income levels. In particular, this way of selling items suits people earning less, allowing the business to capture a wider demographic. With the product in question, a line of all-purpose sport-oriented converse shoes, being able to cater to the majority of people, is very important. As outlined in previous discussions, the goal of this project is to offer customers achievable and affordable standards for both comfort and quality.
This means that the shoes should be easy to distribute and easy to get a hold of. The use of chain stores helps this goal significantly. Additionally, it can be said that chain store locations allow for a more personalized and accurate shopping experience compared to an online platform, for example. In-person operating stores give their customers an ability to try out the product, test various sizes, and also see how it compares to other available options, both in price and appearance. Compared to third-party retailers, chain stores also generally have a large stock of every model, making the process of choosing the correct size more streamlined.
However, some of the potential downsides to choosing this distribution method should also be brought up. Firstly, the presence of the global Covid-19 pandemic should be considered an important factor. With the emergence of the virus, many people have changed their view on retail stores and chain stores as a whole, seeing them as unnecessary or inferior to their online counterparts (Fox et al., 2021). Stores, which are typically designed to house a large number of customers, with the space being comparatively tightly inhabited, are increasingly becoming a place of unease or worry. With the potential of spreading disease heavy on the minds of many, people tend to gravitate towards less crowded options or stay home (Fox et al., 2021). Additionally, one cannot ignore the impact and influence online shopping has had on the industry.
With the introduction of online storefronts, a large portion of individuals has started preferring their convenience over in-person buying. Thirdly, it can be said that chain store locations have to take into account the changes in the customer that have taken place over the past two years. The perceptions of affordability, price, and value have dramatically shifted due to recent developments, changing the fundamental relationship between buyers and sellers. All of these factors are important to realistically address in order to utilize the chain store supply method.
Second Distribution Model
Another distribution channel, which can be seen as a considerable improvement over the traditional product delivery model, is omnichannel product delivery. The developed online space presents itself as a vital and novel way of connecting customers with value, allowing organizations a bigger degree of flexibility and variety in their sales organization. At the same time, traditional structures of selling products are more in-line with the desires and expectations of older generations, giving a brand bigger social outreach. There are a number of advantages to using a combination of both an online platform and an in-person location.
Firstly, it gives customers a bigger degree of choice. The ability to both order an item online and find it in a physical location helps to cater to all demographics, a goal that is especially important to the product in question (Väänänen, 2020). Additionally, the integration of both methods works well to support their interaction, with the online storefront working together with a physical store to make the purchasing process more streamlined (Väänänen, 2020).
Ordering items, product delivery, returns, refunds, and all connected activities have the potential to become integrated into the overall fast system of customer interaction. Additionally, an omnichannel system gives any given business an advantage over its competition. In the interconnected world of today, the ability to find buyers of all ages on different levels of influence is extremely valuable, as it expands the potential audience of a product.
Some of the disadvantages of this method must also be brought up, however. It is expected that the use of both an online and offline platform is more difficult to organize than any given method individually. Good coordination and design are needed to make sure the organization works smoothly on all fronts. Additionally, it is necessary to find a reliable way to deliver products straight to customers’ homes, which is largely becoming a norm for online services. Lastly, this solution may be far less affordable than other approaches. However, due to the renowned and established nature of the brand in question, it is possible to use this method to its full potential without costs becoming a large issue. The implementation of e-business will be used to enhance customer experience and make sure that every part of the buyer-seller interaction proceeds as smoothly as possible. Customer communication and all steps of the buying process will be streamlined and optimized with the use of the internet.
The converse shoes in question are a price-sensitive product. Due to their appeal to a general demographic and a focus on affordability, changes in price or any potential service changes will greatly impact demand for the shoes. The ability of the target demographic to afford footwear is directly connected with the price of said footwear. This effectively means that making the product too expensive will damage its sales and restrict its target demographic. The pricing for the shoes will be largely dependent on the ability of the proposed audience to buy them. As seen by statistics, converse remains one of the brands producing the cheapest sportswear while also remaining competitive and profitable (Median price of popular Sneaker Brands Worldwide 2017). For these hypothetical shoes.
The price bar will have to be made small accordingly as a way to keep in line with the brand image and keep the product within its demographics’ price range. Other factors, such as market competition and other product prices, must also be taken into account. According to data, prices for sportswear have largely kept flat over the recent years, therefore making the affordable option viable in a competitive environment (U.S.: Average sneaker price 2019). The ability of the Converse brand to use combined distribution channels, in addition to low prices and a well-known brand image, will help it to stand out from the competition.
Median price of popular Sneaker Brands Worldwide 2017. Statista. (2021). Web.
Kapner, S. (2015). Shoppers return to chain stores. The Wall Street Journal. Web.
U.S.: Average sneaker price. Statista. (2019). Web.
Väänänen, H. (2020). The future of retail isn’t physical vs online, it’s omnichannel. Forbes. Web.
Fox, R., Goldrick, M., Green, C., & Rettaliata, A. (2021). Redefining value and affordability in retail’s next normal. McKinsey & Company. Web.