What is a 'Mass-Market Retailer'

A mass-market retailer is a company that sells affordably priced products that appeal to a wide variety of consumers. Mass-market retailers are not necessarily known for selling durable, high-quality merchandise or for having exceptional customer service, but they do meet consumers' wants and needs, at reasonable prices.

Examples of mass-market retailers include big box stores such as Target, Sam's Club and Best Buy, as well as brands like Levi Strauss and Gap, and e-retailers like Amazon. Supermarket, drugstore, mass merchandise and warehouse chains, are all considered mass-market retailers.

BREAKING DOWN 'Mass-Market Retailer'

By contrast, luxury retailers sell products targeted at wealthy consumers, who purchase upscale items. These products tend to be out of reach, financially, for the average consumer, although aspirational consumers may purchase them anyway, and are associated with higher quality and superior customer service. Examples of luxury retailers include Bergdorf Goodman, Barney's, Tiffany and Saks.

Sales of merchandise through mass-market retailers represent a substantial portion of revenue generated from consumer goods and grocery purchases in the United States. In other countries, there may be a prevalence for smaller retailers who serve communities and local regions. However as more cities worldwide become more densely populated, mass-market retailers may seize the opportunity to establish themselves in such markets.

The Depth and Reach of Mass-Market Retailers

Though local merchants in the U.S. represent a staple part of the economy, mass-market retail chains have established themselves as the predominant sellers of consumer goods in the country. The concentration of a wide variety of goods at discount prices in one location provides a convenience for consumers who want to combine different types of purchases into one trip to a store.

Mass-market retailers may be able to sell products at lower prices than individual, private retailers because of their overall buying power. This stems from the volume of goods that mass-market chains move through the channel compared with privately-owned retailers that may only have one location. Furthermore, the size of each mass-market retail store can be significantly larger and sell more volume than a privately-owned store.

Product mix is one way for mass-market retailers to be competitive with each other. There may be specific brand items that a mass-market retailer sells that are not available through rival stores.

The dynamics of mass-market retail have evolved with online commerce. Big box retailers continue to dominate in the overall mass-market retail space; however, the growth and reach of Amazon, in particular, have compelled brick-and-mortar retail companies to become more competitive online as well.

RELATED TERMS
  1. Retail Sales

    Retail sales are an aggregated measure of the sales of retail ...
  2. Retail Lender

    A retail lender is a lender who lends money to individuals or ...
  3. Wide Variety

    Wide variety is a merchandising strategy in which a retailer ...
  4. Price War

    A price war refers to a circumstance wherein rival companies ...
  5. Retail Credit Facility

    A retail credit facility is a financing method which can provide ...
  6. Consumer Goods

    Consumer goods are the products purchased by the average consumer. ...
Related Articles
  1. Personal Finance

    Tesla Reveals First Mass Market Electric Vehicle (TSLA)

    Tesla yesterday unveiled the world's first mass-market electric vehicle. Will it succeed?
  2. Tech

    How Robo-Advisors Can Fill Mass-Market Advice Gap

    As advisors turn their sights to wealthier investors, robo-advisors are increasingly becoming a reasonable option for so-called mass market investors.
  3. Insights

    Toyota to Start Mass-Producing Electric Vehicles By 2020 (TSLA, TM)

    Along with General Motors and Volkswagen, the Japanese car company will prove to be formidable competitor to Tesla's ambitions in the same space.
  4. Investing

    Do Retail Store Closings Create a Domino Effect?

    If brick-and-mortar retailers continue to close at today’s pace, here’s how it could play out.
  5. Investing

    Retail Stocks Poised for Big Turnaround

    Retail stocks have taken a beating in recent years, but they now look positioned for a rebound.
  6. Investing

    How Zombie Retailers Are Dragging Down the Industry

    Zombie retailers, which are living on the edge of bankruptcy, are undermining healthier retailers.
  7. Financial Advisor

    Luxury Brand Retailers Face Strong Headwinds (RL)

    Luxury brands are feeling the pinch from slower global economic growth and the shift towards e-commerce.
  8. Investing

    The Top 5 Dividend Paying Retail Stocks for 2016 (M, GPS)

    Learn about five retail merchants that have dividends policies with attractive dividend yields after a sell-off of stocks in the retail sector.
  9. Investing

    After Payless, Who Is the Next Victim of Retail's Shift to the Internet?

    Hurt by huge debt and shrinking foot traffic, retailer woes continue
RELATED FAQS
  1. How does government regulation impact the retail sector?

    Learn about the types of federal agencies and regulations that retail businesses have to deal with, including inconsistent ... Read Answer >>
  2. Hard and soft goods in the retail sector

    Understand the difference between hardlines and softlines offered by various retailers. Find out about the characteristics ... Read Answer >>
  3. What is the difference between an investment and a retail bank?

    Learn the primary differences between retail banks and investment banks by examining the business activities, type of clients ... Read Answer >>
  4. Which economic factors most affect the demand for consumer goods?

    Understand how key economic factors such as inflation, unemployment, interest rates and consumer confidence affect the level ... Read Answer >>
  5. What is the average return on equity for a company in the retail sector?

    Find out more about return on equity, how to calculate it, and the average return on equity for companies in the retail sector. Read Answer >>
Trading Center