Retail Marketing
Magic Solutions
RetailLecture1WhatisRetailing6122018.pptxModule Outline and Lecture 1
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NBS-7030B
Retail Marketing & Management
Ratula Chakraborty
Director MSc Management Programmes
Module Aims
Provide a critical insight on key aspects concerned with retail marketing and management
Provide an understanding of the theory and practice of retail management and strategies pursued by leading retail organisations
Develop skills in obtaining, analysing and applying information from a variety of sources, including publicly available material
Develop the ability to learn and to manage one's own self-learning while collaborating with a team
Enthuse a love for retailing going on to securing careers in retailing
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Intended Learning Outcomes
Knowledge and Understanding:
explain the main functions of retail marketing and management
compare and contrast different company approaches to managing retail operations and developing retail strategies
Subject-specific Skills:
evaluate contemporary analytical and planning approaches to the key functions of retailing
Transferable Skills:
apply skills in obtaining, analysing and using information from a variety of sources, including publicly available material
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Module Content
Introduction: What is Retailing?
Retail Environment: Store Formats and Ethical Issues
Retail Location
Retail Strategy: Competitive Strategy; Advantage; Leadership
Retail Operations: Store Operations; Management; Staffing
Buying and Merchandising
Supply Chain Management: Partnership or Power Struggle?
Retail Marketing: Marketing Strategy; Pricing; Micro-Marketing
International Retailing
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Teaching, Learning & Assessment
Twice weekly two-hours lectures, supported by videos, current articles on Blackboard, flipped mashup videos, twitter feeds and group discussions
Assessment by a two-hour examination (50%) taken at the end of the Semester, and one group assignment through submission of a (maximum 4,000 words) report (50%)
The group assignment issued in Week 1 is to be submitted on Wednesday 25th March and to be marked and returned on 20th April
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Lecture 1 – What is Retailing?
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Retail Marketing & Management
Lecture Outline
Defining retailing
Retailing’s economic role
Retailer variety
Challenges for retail success
Retail winners and losers
Coursework assignment
Purpose: Explain retailing’s economic role and the key challenges facing retailers
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What is Retailing?
Retailing encompasses the business activities involved in selling goods and services to consumers for their personal, family, or household use. It includes every sale to the final consumer.
Retailers are the interface with consumers and the last main link in the supply chain of goods and services
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A Typical Retail Supply Chain
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Manufacturer
Wholesaler
Final
Consumer
Retailer
Economic Role
The retailer serves as an intermediary and value-creator:
allows consumer to make transaction conveniently
collects together different items that the consumer can purchase in one location and in one transaction
bridges the geographical gap between producers and consumers
bulk-breaker (buying in big lots, selling in small lots)
information source to producers and consumers
Think of how hard life would be without retailers!
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Retailer Variety
Retailers come in all shapes, sizes, and forms
Retailers differ by their store size, number of outlets, product ranges, degree of specialisation/generality, value/quality emphasis, location, and service levels
There are over 100,000 retailers operating in the UK, but retailing is dominated by a handful of retail giants
Retail giants, like Wal-Mart (US), Tesco (UK), Carrefour (France) and Metro (Germany), are some of the biggest companies in the world
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10 Largest Retailers in USA
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| Rank | Company | Main Emphasis |
| 1 | Wal-Mart | Full-line discount stores, supercenters, membership clubs |
| 2 | Costco Wholesale Corp | Membership clubs |
| 3 | Kroger | Supermarkets, convenience stores, jewelry stores |
| 4 | Walgreens | Drugstores |
| 5 | Tesco PLC | Grocery retailer |
| 6 | Carrefour SA | Supermarkets in variety of formats |
| 7 | Amazon.com,Inc | Online retailer |
| 8 | Metro GroupAG | German Retail giant – cash and carry and other formats |
| 9 | The Home Depot, Inc | Home improvement retailer |
| 10 | Target | Full-line big-box discount stores, supercenters |
10 Largest Retailers in the World 2017
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| Rank | Company | Main Emphasis |
| 1 | WalMart Stores | Full-line discount stores, supercenters, membership clubs |
| 2 | Tesco PLC | Membership clubs |
| 3 | Costco Wholesale | Supermarkets, convenience stores, jewelry stores |
| 4 | Carrefour S.A | Supermarkets in variety of formats |
| 5 | Kroger Co | Supermarkets, convenience stores, jewelry stores |
| 6 | Lidl Stifung & Co | Supermarkets in variety of formats |
| 7 | Metro Group AG | German Retail giant – cash and carry and other formats |
| 8 | The Home Depot Inc | Home improvement retailer |
| 9 | Aldi | Supermarket, general merchandise |
| 10 | Target | Full-line big-box discount stores, supercenters |
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10 Largest Retailers in UK 2017
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| Rank | Company | Main Emphasis |
| 1 | Tesco | Supermarkets, general merchandise |
| 2 | J Sainsbury | Supermarkets, general merchandise |
| 3 | Asda | Supermarkets, general merchandise |
| 4 | Wm Morrison | Supermarkets |
| 5 | John Lewis Partnership | Department stores, supermarkets (Waitrose) |
| 6 | Marks & Spencer | Clothing, food, general merchandise |
| 7 | Kingfisher | DIY (B&Q) |
| 8 | Dixons Carphone | Merger of Dixons and Carphone |
| 9 | The Co-operative | Supermarkets, general merchandise |
| 10 | Aldi | Discounter Supermarket, general merchandise |
Retail Challenges
Developing a retail proposition with strong consumer appeal
Building a retail brand that is different/unique and can thrive in the face of intense retail competition
Complying with legal requirements in a heavily regulated sector
Prospering regardless of the economic environment
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Retail Formats
The nature of the retail proposition facing consumers:
merchandise range (broad or limited)
service level (high, low or mixed)
number of outlets (chain stores v. independents)
store size (“big box” outlets to shopkeeper stores)
relative emphasis on price (low-, mid- or high-margin)
nature of location (e.g. out-of-town or high-street)
value position (from category killers to exclusive specialists)
mode of consumer access (bricks-and-mortar or e-tailer)
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Retail Competition
Factors shaping the competitive environment:
Rising retail concentration at sector level and national level
New, aggressive competition – e.g. hypermarkets, one-stop shops, category killers, hard discounters, internet retailers
Regulation influencing competition:
Structural measures (restricting firms’ market dominance)
planning permission
merger policy
Behavioural measures (limiting anti-competitive behaviour)
pricing practices (collusion, below-cost selling, RPM)
buyer power practices (e.g. Grocery Suppliers Code of Practice)
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Legal Issues in Retailing
Legal restraints on retailers’ actions:
Consumer protection
Sales of Good Act; Consumer Protection Act; Food Safety Act; Food Standards Act; Consumer Credit Act
Employee protection
Shops Act, Sunday Trading Act; Employment Rights Act; National Minimum Wage Act
Planning regulations
National Planning Policy Framework (NPPF)
Competition policy
UK Competition Act, EU Articles 101 & 102
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Economic Environment
Challenging economic situation facing UK retailers:
Fragile economic recovery & BREXIT!
Fragile growth, restricted disposable income, price-conscious consumers trading down and limiting retail spending
Inflation shifting to deflation then inflation
Rising then falling material and energy costs, retailers fighting to serve price-conscious consumers
Banking crisis’s long-term impact
Business borrowing difficult, reduced govt spending, higher business and personal taxes, high VAT rate (20%)
Regional disparities
Areas of high unemployment and social deprivation, run down town centres, Ghost Town and Clone Town Britain
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‘The Times, They are a Changin…’
The uncertain economic environment continues to be the major influence on shopping behaviour:
2009 The `Wealth Shock` with households seeing no increase in property values
2010 The `Food Shock` as consumers adapt to permanently higher food prices
2011 The `Fuel Shock` as the cost of petrol and diesel increases significantly
2012 The `Income Shock` as shoppers cope with falling disposable income
2013 The ‘Income Shock’ and Job Losses continue
2014 The ‘Gradual Improvement’ as unemployment falls
2015 The ‘Inflation to Deflation Switch’ with low global demand
2016/17 Creeping inflation and BREXIT influence….
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Winners and Losers
Retailers prospering in the difficult economic times:
Hard discounters (Aldi, Lidl)
Upmarket/aspirational retailers (Waitrose, Gucci, Louis Vuitton)
Online retailers (Asos, Amazon)
Blackboard item ‘UK Retailers gone bust 2008-2018
Retailers suffering in the difficult economic times:
Small, traditional retailers (corner shops, family-run stores)
Mid-market specialist retailers (clothing, food, etc)
Big-ticket-item retailers (electrical, carpets, furniture)
Leisure/lifestyle specialists (outdoor, music/film, homeware)
http:// www.retailresearch.org/whosegonebust.php
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Questions for Discussion
What is your favourite retailer? Why?
What is your least favourite retailer? Why?
Where is the best place to shop for bargains?
How good is retail service in the UK? What is your worst experience?
What lessons/ideas could UK retailers learn/adopt from other countries?
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Coursework Assignment
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Retail Marketing & Management
Module Coursework
Group assignment: 3 students per group
4,000 word report
Develop a new retail business to be located in Norwich of your own choosing
Operational business plan covering store operations, pricing, merchandising, marketing, and supply chain management
Need to choose a retail store type, location and product range, plus demand and competitor analysis. Is the business viable?
For suggested retail locations in Norwich: see
http://www.visitnorwich.co.uk/shopping.aspx
https://www.intugroup.co.uk/media/1313/intu2032_chapelfield_180213.pdf
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Coursework Criteria
In general, the coursework, amongst other things, should contain the following:
A rationale for choosing the retail format (i.e. type of shop) and retail sector
An explanation of the retail design
A brief summary of the competitive environment and positioning of the company
Appropriate analysis to highlight and justify the operational, merchandising and supply chain decisions taken
• You cannot choose to open a franchise retail outlet.
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Assessment Criteria for Coursework
The mark awarded will take into consideration:
Learning Outcomes and scholarship; application of existing retail management concepts and theories - 25%
Understanding and evidence of wide reading and information searching - 20%
Originality and viability of the retail format/business chosen - 20%
Quality of the critical assessment and arguments presented - 25%
Referencing and presentation - 10%
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Retail Locations in Norwich
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Shopping malls: Castle Mall, Chapelfield
Retail parks: Riverside, Cathedral Park
City centre: The Lanes, Cathedral Quarter, London Street, Gentleman’s Walk, Timber Hill, Royal Arcade, St Stephens, Norwich Market, Elm Hill, St Benedicts, Upper St Giles
District centres: Anglia Square, Magdelene St
Neighbourhood: Earlham Rd, Longwater, Eaton, Boundary Rd (A140), Salhouse Rd, etc
Norwich City Shopping
Consistently ranked in the top 10 for retail centres in the UK (e.g. by CACI and Venuescore)
http:// s3-eu-west-1.amazonaws.com/cjp-rbi-communities-blogs/wp-content/uploads/mt/estatesgazette/pdf/Retail%20Footprint%20Map%202011.pdf
Diverse mix of retailing: major multiple retailers, department stores, independent specialists, boutiques, and covered market
Diverse range of primary, secondary and district shopping locations
Vibrant shopping centre with low shop vacancy rate (compared to other parts of the UK)
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Norwich: Top 10 Ranked Retail Centre in UK
CACI Retail Footprint 2011 top ten rankings
(based on retail centre forecast expenditure £m)
1. London - West End £3,270m
2. Glasgow £2,480m
3. Birmingham £2,430m
4. Manchester £2,340m
5. Liverpool £1,790m
6. Nottingham £1,730m
7. Leeds £1,490m
8. Westfield London £1,460m
9. Newcastle Upon Tyne £1,240m
10. Norwich £1,180m
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Key Retail Locations
1 Norwich Lanes
2 Norwich Market
3 Royal Arcade
4 Timber Hill
5 John Lewis
6 Debenhams
7 Marks & Spencer
8 St Stephens
9 Chapelfield
10 Jarrold
11 Castle Mall
12 Gentlemanʼs Walk
13 London Street
14 Cathedral Quarter
15 Magdalen Street
16 Anglia Square
17 Cathedral Retail Park
18 Riverside Retail
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Key Retail Locations:
1. Norwich Market
2. Gentlemans Walk
3. The Royal Arcade
4. Chapelfield
5. John Lewis dept store
6. St Stephens Street
7. M&S and Debenhams
8. Timberhill
9. Castle Mall
10. Jarrolds dept store
11. London Street
12. Norwich Lanes East
13. Norwich Lanes West
Norwich City Centre Shopping
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Norwich City Centre: Primary Shopping Areas
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Norwich City Centre: Secondary Shopping Areas
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Norwich City Centre: District Centres
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Chapelfield
Castle Mall
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Riverside Retail Park
The Royal Arcade
Jarrolds and
the Lanes
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Gentleman’s Walk
Lower Goat Lane in the Norwich Lanes
London Street
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Retail Opportunities
What is Norwich lacking? Where is there a gap in the market?
Retailer types suggestions: http://en.wikipedia.org/wiki/Retail
A huge range of retail types and retail sectors to choose from:
Clothing and footwear specialists
Specialist/niche/health grocery stores
Discounters (pound stores, variety stores, factory stores)
DIY, home improvement and garden centres
Electronics and appliance specialist retailers
Furniture, furnishings, homeware, lighting stores
Health and beauty specialist retailers
Leisure and personal goods specialist retailers
Big-box specialist retailers (e.g. pets, hobbies, toys)
Gift shops (product category or country-of-origin focused)
Themed shops (e.g. gadgets, colours, parties, TV/film characters)
If it is such a good idea then why has nobody done it already?
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Thank You!
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