Methods of reaching consumers

Finally, a retail business can be classified by the way it reaches its customers. There are four different methods of reaching consumers: over-the-counter retailing, mail-order retailing, direct retailing, and vending machine retailing.

Over-the-Counter Retailing. Selling products in a store is called over-the-counter retailing. Customers go into a store to shop and select the products they wish to buy from the retailer’s stock. Ninety percent of all retailing activity occurs this way. Food, clothing, home appliances, furniture ‑ a seemingly endless list of products is sold through the over-the-counter method.

Mail-Order Retailing. In mail-order retailing, customers select the products they want from catalogs or advertisements. While most orders are mailed to the company, an increasing number of customers are placing orders by telephone. In the future, customers may be able to place their orders over telephone lines using home computers.

Merchandise is delivered directly to customers by the United States Postal Service, United Parcel Service, or private freight lines. Some department stores also sell by catalog. In this case, merchandise is picked up by customers at catalog desks in the stores.

Many companies have successfully used mail order as their method of doing business. Some of them provide such large varieties of merchandise that they are called "department stores in print." Others concentrate on specific types of goods such as housewares, novelty items, vitamins and other health products, clothing, or food products.

Direct Retailing. In direct retailing, sellers contact prospective customers in their homes. There are two main types of direct retailing: door-to-door selling and party plan selling.

Some cosmetic and vacuum cleaner manufacturers have become famous for selling door to door and demonstrating products in prospective customers’ homes. Others sell their products by the party plan. A salesperson asks someone to give a party and invite relatives and friends. The salesperson shows the manufacturer’s product line to the group, demonstrates how each item is used, and takes orders. Kitchen utensils, food storage containers, jewelry, and clothing are products that are sold this way.

Vending Machine Retailing. Vending machine retailing requires no personal contact between seller and buyer. The product is sold through a machine. This type of retailing has grown in popularity, and the variety of products offered has increased. Soft drinks, candy, and snack foods have been sold through vending machines for many years. In addition, they now dispense refrigerated foods and foods that can be heated in microwave ovens located nearby. Toothpaste, toothbrushes, small toys, games, and road maps can often be found in service station vending machines. Vending machines at airports dispense insurance policies.

Probably the most familiar type of vending machine is coin operated. However, some machines now accept credit cards. In order to make purchases, customers simply insert their cards. The machines record transactions and electronically provide bills. Many banks now have machines that dispense cash when customers insert cards and strike special numbers on their keyboards.