Assignment and Reflection about Principles of Marketing
mark39
ClassChapter14.pptxRetailing
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“All activities directly related to the sale of goods and services to the ultimate consumer for personal, nonbusiness use.”
What is retailing?
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Retailer:
Channel intermediary that sells mainly to consumers
What is retailing?
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Type of ownership
Level of service
Product assortment
Price
Classification of retail operations
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Type of ownership
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Independent retailer
Establishment is owned by an individual or a group
Chain store
Part of a group of the same stores owned and operated by a single organization
Franchise
Relationship in which business rights to operate and sell a product are granted by the franchisor to the franchisee
Full-service
Self-service
Level of service
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Based on width and depth of product lines
Width: assortment of products offered
Depth: number of different brands offered within each assortment
Product assortment
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Gross margin:
The amount of money a retailer makes as a percentage of sales, after subtracting cost of goods sold (COGS)
A warehouse club like Sam’s might have a low gross margin
A department store like Dillards might have a moderately high gross margin
Price
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Types of in-store retailers
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Department stores
Specialty stores
Supermarkets
Drugstores
Convenience stores
Discount stores
Restaurants
Full-line discount stores
Supercenters
Specialty discount stores
Category killers
Warehouse club
Off-price retailers
Factory outlets
Used goods retailers
Types of in-store retailers
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Discount stores
Shopping without visiting a physical location
Types:
Automatic vending (vending machines)
Direct retailing (Avon; Mary Kay)
Direct marketing (direct mail and mail order catalogs; shop at home networks like QVC)
Online retailing (e-tailing; Amazon)
Non-store retailing
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Floor stock: inventory displayed for customers
Back stock: inventory held in reserve to refill floor stock if necessary
Specialty shops must often keep high amounts of both to accommodate customer needs
But, is expensive to purchase large amounts of product
Operating models
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Define and select a target market
Develop the “retailing mix” (same as services 7 Ps)
Marketing strategy for retailers
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Includes advertising, PR and publicity, and sales promotion
Risk of brand cannibalization
Reduction of sales for one brand as the result of the introduction of a new product
Online shopping can also reduce in-store sales
Promotion strategy
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Many chains (like McDonalds) will very carefully analyze areas for new stores
Economic growth potential
Amount of competition
Geography
Stores in isolated locations may become destination stores
Lifestyle centers are increasing in popularity
Place strategy
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Place strategy – lifestyle centers
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Manipulate factors to influence store atmosphere
Employee type and density
Merchandise type and density
Fixture type and density
Sound, odors, and visual factors
Layout of store
Presentation – Physical environment
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Presentation – Physical environment
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Presentation – Physical environment
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Train your salespeople
Trading up (up-selling)
Suggestion selling (cross-selling)
Personnel - People
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Service improvement may involve:
Minimizing wait times
Managing service capacity
Improving service delivery
Establishing channel-wide network coherence
Retailing services
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Failure: when service provided does not meet customer expectations
Recovery: efforts by the firm to do something about unmet expectations
Actions for recovery in retail:
Notifying customers of stockouts
Liberal return policies
Product recalls issued in conjunction with promotional offers
Service failure and recovery
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Big data analytics
Beacons
Connecting signals in store that bring info to consumers’ phones
RFID
For tracking in-store merchandise
And for knowing if a consumer picks up a product (i.e. considering buying it)
Trends in retailing
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Shopper marketing
Understanding how consumers behave differently in different channels (like online vs in-store)
Shopper analytics
Collecting data to understand the consumer’s shopping experience
Attitudes, perceptions, emotions, and behaviors
Retailing services
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Retail channel omnification:
Consumers use multiple sources for shopping information simultaneously
Click-and-collect:
Buy online, pick up in store
Robots
Lowe’s video: https://www.cnbc.com/2016/08/30/lowes-introduces-lowebot-a-new-autonomous-in-store-robot.html
Retailing services
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