LOG 561 Retail Management An Introduction to Retailing.
-
Upload
eric-pickard -
Category
Documents
-
view
240 -
download
3
Transcript of LOG 561 Retail Management An Introduction to Retailing.
![Page 1: LOG 561 Retail Management An Introduction to Retailing.](https://reader036.fdocuments.net/reader036/viewer/2022062304/56649c805503460f94937218/html5/thumbnails/1.jpg)
LOG 561 Retail Management
An Introduction to Retailing
![Page 2: LOG 561 Retail Management An Introduction to Retailing.](https://reader036.fdocuments.net/reader036/viewer/2022062304/56649c805503460f94937218/html5/thumbnails/2.jpg)
2
RetailingRetailing 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.
![Page 3: LOG 561 Retail Management An Introduction to Retailing.](https://reader036.fdocuments.net/reader036/viewer/2022062304/56649c805503460f94937218/html5/thumbnails/3.jpg)
• Retailing – a set of business activities that adds value to the products and services sold to consumers for their personal or family use.
• A retailer is a business that sells products and/or services to consumers for personal or family use.
What is Retailing?
![Page 4: LOG 561 Retail Management An Introduction to Retailing.](https://reader036.fdocuments.net/reader036/viewer/2022062304/56649c805503460f94937218/html5/thumbnails/4.jpg)
Examples of Retailers
• Retailers:-Holiday Inn, McDonalds, Amazon.com..
• Firms that are retailers and wholesalers that sell to other business as well as consumers:-The Home Depot, United Airlines, Bank of America..
![Page 5: LOG 561 Retail Management An Introduction to Retailing.](https://reader036.fdocuments.net/reader036/viewer/2022062304/56649c805503460f94937218/html5/thumbnails/5.jpg)
How Retailers Add Value• Breaking Bulk
-Buy it in quantities customers want• Holding Inventory
-Buy it at a convenient place when you want it• Providing Assortment
-Buy other products at the same time• Offering Services
-See it before you buy, get credit, layaway
![Page 6: LOG 561 Retail Management An Introduction to Retailing.](https://reader036.fdocuments.net/reader036/viewer/2022062304/56649c805503460f94937218/html5/thumbnails/6.jpg)
Doll can be bought on credit or put on
layaway
Doll is featured on floor display
Doll is offered in convenient locations in quantities of one
Doll is developed in several styles
How Retailers Add Value
Doll is developed at manufacturer
The value of the product and service increases as the retailer performs functions.
![Page 7: LOG 561 Retail Management An Introduction to Retailing.](https://reader036.fdocuments.net/reader036/viewer/2022062304/56649c805503460f94937218/html5/thumbnails/7.jpg)
Manufacturer’s PerspectiveThe Four P’s of Marketing
Distribution
Retailers are part of the distribution channel
Retailers are part of thedistribution channel
Product
Price
Promotion
![Page 8: LOG 561 Retail Management An Introduction to Retailing.](https://reader036.fdocuments.net/reader036/viewer/2022062304/56649c805503460f94937218/html5/thumbnails/8.jpg)
Distribution ChannelDistribution Channel
PPT 1-4
![Page 9: LOG 561 Retail Management An Introduction to Retailing.](https://reader036.fdocuments.net/reader036/viewer/2022062304/56649c805503460f94937218/html5/thumbnails/9.jpg)
Accounting Finance
MISOperations
Marketing
Human Resources
Retailers are a Business Like Manufacturers
![Page 10: LOG 561 Retail Management An Introduction to Retailing.](https://reader036.fdocuments.net/reader036/viewer/2022062304/56649c805503460f94937218/html5/thumbnails/10.jpg)
Decision Variables for Retailers
Customer Service
Store Design and Display
MerchandiseAssortment
Communication Mix
LocationPricing
Retail Strategy
![Page 11: LOG 561 Retail Management An Introduction to Retailing.](https://reader036.fdocuments.net/reader036/viewer/2022062304/56649c805503460f94937218/html5/thumbnails/11.jpg)
Hot Topic’s Retail Mix
Retail Strategy
Customer Service Location
MerchandiseAssortment
PricingCommunication Mix
Store DesignAnd Display
![Page 12: LOG 561 Retail Management An Introduction to Retailing.](https://reader036.fdocuments.net/reader036/viewer/2022062304/56649c805503460f94937218/html5/thumbnails/12.jpg)
STRATEGIC IMPLICATIONS: RETAIL MARKETING STRATEGY
• A retailer develops a marketing strategy based on the firm’s goals and strategic plans
• Two fundamental steps:1. Picking a target market: size and profit potential.
POSITION. 2. Developing a retailing mix to satisfy the chosen
target market1. 4Ps + Personnel & Presentation used to create a retail
image
![Page 13: LOG 561 Retail Management An Introduction to Retailing.](https://reader036.fdocuments.net/reader036/viewer/2022062304/56649c805503460f94937218/html5/thumbnails/13.jpg)
TargetMarket
ProductProduct
PricePrice
PlacePlace
PromotionPromotion
PersonnelPersonnel
PresentationPresentation
The Retailing Mix
![Page 14: LOG 561 Retail Management An Introduction to Retailing.](https://reader036.fdocuments.net/reader036/viewer/2022062304/56649c805503460f94937218/html5/thumbnails/14.jpg)
Issues in Retailing• How can we best serve our customers while earning a fair
profit?• How can we stand out in a highly competitive environment
where consumers have so many choices?• High unemployment, low consumer confidence, high savings
rates have reduced consumer spending. At the same time retail competition has increased through increased format blurring (sales of cameras at office supply stores, carpeting and major appliances at home improvement centers).
• How can we grow our business while retaining a core of loyal customers?
![Page 15: LOG 561 Retail Management An Introduction to Retailing.](https://reader036.fdocuments.net/reader036/viewer/2022062304/56649c805503460f94937218/html5/thumbnails/15.jpg)
15
The Philosophy
Retailers can best address these questions by fully understanding and applying the basic principles of retailing, as well as the elements in a well-structured, systematic, and focused retail strategy.
![Page 16: LOG 561 Retail Management An Introduction to Retailing.](https://reader036.fdocuments.net/reader036/viewer/2022062304/56649c805503460f94937218/html5/thumbnails/16.jpg)
Top 100 Retailers
Walmart, Kroger, Costco, Target, The Home Depot, Walgreen, CVS Caremark, Lowe’s, Amazon.com, Safeway...
https://nrf.com/2014/top100-table
![Page 17: LOG 561 Retail Management An Introduction to Retailing.](https://reader036.fdocuments.net/reader036/viewer/2022062304/56649c805503460f94937218/html5/thumbnails/17.jpg)
A Typical Channel of Distribution
Manufacturer
Wholesaler Final Consumer
Retailer
![Page 18: LOG 561 Retail Management An Introduction to Retailing.](https://reader036.fdocuments.net/reader036/viewer/2022062304/56649c805503460f94937218/html5/thumbnails/18.jpg)
The Retailer’s Role in the Sorting Process
![Page 19: LOG 561 Retail Management An Introduction to Retailing.](https://reader036.fdocuments.net/reader036/viewer/2022062304/56649c805503460f94937218/html5/thumbnails/19.jpg)
Multi-Channel Retailing
• A retailer sells to consumers through multiple retail formats:• Web sites• Physical stores
![Page 20: LOG 561 Retail Management An Introduction to Retailing.](https://reader036.fdocuments.net/reader036/viewer/2022062304/56649c805503460f94937218/html5/thumbnails/20.jpg)
Multi-Channel Retailing
• Cross selling across channels (in-store product availability info on Web site)• Consistent pricing in all channels (credibility)• Can buy, and return product regardless on channel• Role of each channel
o Store– try on, ease of return, fast availability (immediacy), compare offerings
o Web– 24/7, product information, product reviews by customers, personalization (tailored assortment based on past purchases), most current pricing, closeout sales
o Catalog-permanency, true color
![Page 21: LOG 561 Retail Management An Introduction to Retailing.](https://reader036.fdocuments.net/reader036/viewer/2022062304/56649c805503460f94937218/html5/thumbnails/21.jpg)
Non-Store Retailing• Vending: hi costs; hi prices (flat sales)• Vending is a $40 billion U.S. market• Cashless vending=wave of future• Direct Marketing (Mail, Catalog, Telemarketing)• E-tailing (TV shopping, online)• M-commerce: buy from mobile devices(e.g., cell phones)
![Page 22: LOG 561 Retail Management An Introduction to Retailing.](https://reader036.fdocuments.net/reader036/viewer/2022062304/56649c805503460f94937218/html5/thumbnails/22.jpg)
Apple
![Page 23: LOG 561 Retail Management An Introduction to Retailing.](https://reader036.fdocuments.net/reader036/viewer/2022062304/56649c805503460f94937218/html5/thumbnails/23.jpg)
Distribution Types
• Exclusive: suppliers make agreements with one or few retailers, designating such retailers as the only ones to carry certain brands or products within a specified geographic area
• Intensive: suppliers sell through as many retailers as possible
• Selective: suppliers sell through a moderate number of retailers
![Page 24: LOG 561 Retail Management An Introduction to Retailing.](https://reader036.fdocuments.net/reader036/viewer/2022062304/56649c805503460f94937218/html5/thumbnails/24.jpg)
24Retail Mgt. 12e (c) 2013 Pearson Education, Inc. publishing as Prentice Hall
Exclusive vs Intensive Distribution
• Exclusive Distribution– Fate of retailer is tied to manufacturer success, retailer has no “free-rider” concerns, retailer has less price competition, manufacturer is better assured of high levels of customer support
• Intensive Distribution- Manufacturer is better assured of maximizing sales (especially for convenience goods), retailers face strong competition for price and service, intratype competition
![Page 25: LOG 561 Retail Management An Introduction to Retailing.](https://reader036.fdocuments.net/reader036/viewer/2022062304/56649c805503460f94937218/html5/thumbnails/25.jpg)
Comparing Distribution Types
![Page 26: LOG 561 Retail Management An Introduction to Retailing.](https://reader036.fdocuments.net/reader036/viewer/2022062304/56649c805503460f94937218/html5/thumbnails/26.jpg)
Special Characteristics Affecting Retailers
Impulse Purchase
PopularityofStores
Retailer’sStrategy
Small Average Sale
![Page 27: LOG 561 Retail Management An Introduction to Retailing.](https://reader036.fdocuments.net/reader036/viewer/2022062304/56649c805503460f94937218/html5/thumbnails/27.jpg)
Retail Strategy
• An overall plan for guiding a retail firm
• Influences the firm’s business activities
• Influences firm’s response to market forces
![Page 28: LOG 561 Retail Management An Introduction to Retailing.](https://reader036.fdocuments.net/reader036/viewer/2022062304/56649c805503460f94937218/html5/thumbnails/28.jpg)
Six Steps in Strategic Planning
1. Define the type of business (corporate mission)
2. Set long-run and short-run objectives
3. Determine the customer market
4. Devise an overall, long-run plan
5. Implement an integrated strategy
6. Evaluate and correct (fine-tune)
![Page 29: LOG 561 Retail Management An Introduction to Retailing.](https://reader036.fdocuments.net/reader036/viewer/2022062304/56649c805503460f94937218/html5/thumbnails/29.jpg)
Applying the Retailing Concept
Customer Orientation
Coordinated Effort
Value-driven
Goal Orientation
RetailingConcept
RetailStrategy
![Page 30: LOG 561 Retail Management An Introduction to Retailing.](https://reader036.fdocuments.net/reader036/viewer/2022062304/56649c805503460f94937218/html5/thumbnails/30.jpg)
The Build-A-Bear Experience: Never Boring
![Page 31: LOG 561 Retail Management An Introduction to Retailing.](https://reader036.fdocuments.net/reader036/viewer/2022062304/56649c805503460f94937218/html5/thumbnails/31.jpg)
Customer Service• Activities undertaken by a retailer
in conjunction with the basic goods and services it sells. This includes:• Store hours• Parking• Shopper-friendliness• Credit acceptance• Salespeople
![Page 32: LOG 561 Retail Management An Introduction to Retailing.](https://reader036.fdocuments.net/reader036/viewer/2022062304/56649c805503460f94937218/html5/thumbnails/32.jpg)
A Customer Respect Checklist
Do we trust our customers?Do we stand behind what we sell?Is keeping commitments to customers
important to our company?Do we value customer time?Do we communicate with customers
respectfully?Do we treat all customers with respect?Do we thank customers for their business?Do we respect employees?
![Page 33: LOG 561 Retail Management An Introduction to Retailing.](https://reader036.fdocuments.net/reader036/viewer/2022062304/56649c805503460f94937218/html5/thumbnails/33.jpg)
Relationship Retailing• Retailers seek to establish and maintain long-
term bonds with customers, rather than act as if each sales transaction is a completely new encounter• Concentrate on the total retail experience• Monitor satisfaction • Stay in touch with customers
![Page 34: LOG 561 Retail Management An Introduction to Retailing.](https://reader036.fdocuments.net/reader036/viewer/2022062304/56649c805503460f94937218/html5/thumbnails/34.jpg)
Effective Relationship Retailing• Use a “win-win” approach
• It is easier to keep existing customers happy than to gain new ones (present value of current customers income stream– cost of keeping existing customers content versus cost of replacing them with new customer
• Develop a customer database (loyalty programs)• Ongoing customer contact is improved with information
on people’s attributes and shopping behaviors
![Page 35: LOG 561 Retail Management An Introduction to Retailing.](https://reader036.fdocuments.net/reader036/viewer/2022062304/56649c805503460f94937218/html5/thumbnails/35.jpg)
Types of Loyalty Programs• Additional discounts at register
• Not a real loyalty program• 1 free with every “n” items purchased
• Easily copied, no customer database• Rebates based on cumulative purchases
• Customer maintains records• Can develop “heavy half” programs like Hilton
• Targeted offerings and mailing based on purchase history• Tesco example “Market research staff know more
about my customers than board chairperson”
![Page 36: LOG 561 Retail Management An Introduction to Retailing.](https://reader036.fdocuments.net/reader036/viewer/2022062304/56649c805503460f94937218/html5/thumbnails/36.jpg)
36Retail Mgt. 12e (c) 2013 Pearson Education, Inc. publishing as Prentice Hall
Relationship Management Among Retailers and Suppliers
• Disagreements may occur in the following areas (channel conflict):• control over channel (private label)• profit allocation (resale price control)• number of competing retailers (exclusive, selective or intensive
distribution)• product displays• promotional support (cooperative advertising funds and
restrictions)• payment terms (payment on time)• operating flexibility• gray market sales• markdown monies, chargebacks by dominant retailers
![Page 37: LOG 561 Retail Management An Introduction to Retailing.](https://reader036.fdocuments.net/reader036/viewer/2022062304/56649c805503460f94937218/html5/thumbnails/37.jpg)
Approaches to the Study of Retailing
Institutional
Functional
Strategic
![Page 38: LOG 561 Retail Management An Introduction to Retailing.](https://reader036.fdocuments.net/reader036/viewer/2022062304/56649c805503460f94937218/html5/thumbnails/38.jpg)
Parts of Retail Management: A Strategic Approach
• Building relationships and strategic planning
• Retailing institutions • Consumer behavior and information
gathering• Elements of retailing strategy• Integrating, analyzing, and improving
retail strategy
![Page 39: LOG 561 Retail Management An Introduction to Retailing.](https://reader036.fdocuments.net/reader036/viewer/2022062304/56649c805503460f94937218/html5/thumbnails/39.jpg)
• Retailing is a set of functions that adds value to products/services that are sold to end users = functional understanding,
• Retailing is a specific institution within a marketing channel that executes retail functions = institutional understanding
![Page 40: LOG 561 Retail Management An Introduction to Retailing.](https://reader036.fdocuments.net/reader036/viewer/2022062304/56649c805503460f94937218/html5/thumbnails/40.jpg)
End of Week 2, any questions???