Marketing 12e - Pride and Ferrell

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Transcript Marketing 12e - Pride and Ferrell

The Nature of Retailing
• Retailing
–Transactions in which ultimate consumers are the
buyers
• Retailers
–Organizations that purchase products for the purpose
of reselling them to ultimate consumers
• Retailers add value—shopping convenience, services, and
purchasing assistance to customers
• Retailers create utility—time, place, possession, and form
–Success in retailing comes from having a strong
customer focus coupled with desired levels of service,
product quality, and innovation.
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16–1
Major Types of Retail Stores
• General-Merchandise Retailers
– A retail establishment that offers a variety of product lines
– Department stores
• Large retail organizations characterized by wide product mixes
and organized into separate departments to facilitate marketing
efforts and internal management
• Goldsmiths, Dillards
– Discount stores
• Self-service, general merchandise stores offering brand name and
private brand products at low prices
• Walmart, Target
– Supermarkets
• Large, self-service stores that carry a complete line of food
products, along with some nonfood products
• Kroger, Schnucks, Albertsons
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16–2
Major Types of Retail Stores (cont’d)
• General-Merchandise Retailers (cont’d)
– Superstores
• Giant retail outlets that carry food and nonfood products found in
supermarkets, as well as most routinely purchased consumer
products
• Walmart Supercenters
– Hypermarkets
• Stores that combine supermarket and discount shopping in one
location
• Carrefour (France), not successful in U.S.
– Warehouse clubs
• Large-scale, members-only establishments that combine features
of cash-and-carry wholesaling with discount retailing (fewer
items, large volume)
• Costco beats Sams Club!
• Costco in Japan….
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16–3
Major Types of Retail Stores (cont’d)
• General-Merchandise Retailers (cont’d)
–Warehouse showrooms
• Retail facilities in large. low-cost buildings with large onpremise inventories and minimal services (consumers
must do a lot themselves)
• IKEA
–Catalog showrooms
• A form of warehouse showroom where consumers can
shop from a catalog and products are stored out of buyers’
reach
• Service Merchandise? Beat out by Warehouse clubs.
• Brookstone – still doing well for xmas.
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16–4
Major Types of Retail Stores (cont’d)
• Specialty Retailers
–Traditional specialty retailers
• Also called “limited-line” and “single-line” retailers
• Carry a narrow product mix with deep product lines (e.g.,
pet supplies)
• Have higher costs and higher margins
• Provide more product selection (first-line brands), product
expertise, and high levels of personal service
–Foot Locker
–Dilday TV
–http://www.buildabear.com/
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16–5
Major Types of Retail Stores (cont’d)
• Specialty Retailers (cont’d)
–Off-price retailers
• Buy manufacturers’ seconds, overruns, returns, and offseason merchandise for resale to consumers at deep
discounts
• Charge less than do department stores for comparable
merchandise and offer few customer services
• Have established long-term relationships with suppliers for
continuing supplies of reduced-price goods
–TJ Maxx, Steinmart, Burlington Coat Factory
–Category killers (rising in popularity! Killing small bus!)
• Concentrate on a major product category and compete on
the basis of low prices and product availability
–Sports Authority, Home Depot, Bed Bath and Beyond, Toys R
Us, Office Depot
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16–6
NonStore Retailing
• Nonstore Retailing Defined
–The selling of products outside the confines of a retail
facility
–Growth sector of retailing due to
• Consumers are less willing to devote personal time to
shopping in retail stores.
• Poorly trained and informed retail personnel can’t offer
needed sales assistance.
• Growing population of older shoppers
who tend to shop less in large stores.
–Category Killers and Discounters
–Overwhelming!
–What happened to small hardware store?
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16–7
NonStore Retailing (cont’d)
• Direct Selling
–The marketing of products to ultimate consumers
through face-to-face sales presentations at home or in
the workplace
• Party plans: hosting groups to view a product
demonstration and encouraging participants to purchase
the products
• Tupperware, Mary Kay (now opening stores), Amway!
–Benefits
• Personal attention to customer
• Convenience of time and place of presentation
–Limitations
• High costs make it the most expensive form of selling
• Negative consumer view of direct selling
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16–8
NonStore Retailing (cont’d)
• Direct Marketing
–The use of telephone and nonpersonal media to
introduce products to consumers, who then can
purchase them via mail, telephone, or the Internet
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16–9
Types of Direct Marketing
• Catalog Marketing
–A type of marketing in which an organization provides a
catalog from which customers can make selections and
place orders by mail, telephone, or the Internet
• Consumer advantages are efficiency and convenience
• Marketer advantages are lower location, facility, selling,
and operating costs.
• Disadvantages are inflexibility
and limited selection and local
service availability.
• Speigel, Land’s End, JCrew
• Frontgate
• Victoria’s Secret (combines
• With retail stores)
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16–10
Direct Marketing (cont’d)
• Direct-Response Marketing
–A type of marketing that occurs when a retailer
advertises a product and makes it available through
mail or telephone orders
• Telemarketing
–The performance of marketing-related activities by
telephone
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16–11
Direct Marketing (cont’d)
• Television Home Shopping
–A form of selling in which products are presented to
television viewers, who can buy them by calling a tollfree number and paying with a credit card
• Online Retailing
–Retailing that makes products
available to buyers through
computer connections
• Automatic Vending
–The use of machines to dispense
products
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16–12
Franchising
• Franchising
–An arrangement in which a supplier (franchiser) grants
a dealer (franchisee) the right to sell products in
exchange for some type of consideration
• Franchiser furnishes equipment, buildings, management
know-how, and marketing assistance.
–Holiday Inn Express
• Franchisee supplies labor and capital, and operates the
business by the provisions of the franchise agreement.
–Manager of local HI Express
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16–13
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16–14
Franchising (cont’d)
• Advantages
–Enables business startup with limited capital
–Provides developed and proven business to franchisee
–Attracts customers with established brand name
–Allows immediate market entry
–Motivates franchisee to succeed
• Disadvantages
–Control over aspects of the business and its operations
by franchiser
–Expense of continuing franchise royalties and
advertising fees
–Lack of control of franchisees by franchisor
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16–15
Strategic Issues in Retailing
• Retail Store Location
–Location, location, location
• Types of Locations
–Free-standing structures
• Position relative to competition
• Customer access and parking
–Traditional business districts
• Redevelopment of decaying
downtown infrastructure
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16–16
Strategic Issues in Retailing (cont’d)
• Traditional Shopping Centers
–Neighborhood shopping centers
• Usually consist of several small convenience and specialty
stores.
–Community shopping centers
• Include one or more department stores (anchors), some
specialty stores, and convenience stores.
–Regional shopping centers
• Have the largest department
stores, the widest product mix,
and the deepest product lines
of all shopping centers.
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16–17
Strategic Issues in Retailing (cont’d)
• Nontraditional Shopping Centers
–Factory outlet malls
• Shopping centers that feature discount and factory outlet
stores carrying traditional brand name products
–Miniwarehouse mall
• Loosely planned centers that lease space to retailers
running retail stores out of warehouse bays
–Nonanchored malls
• Do not have traditional department store anchors; instead
combine off-price and category killer stores in a “power
center” format
–Home Depot is the anchor instead of department stores
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16–18
Strategic Issues in Retailing (cont’d)
• Retail Positioning
–Identifying an unserved or underserved market
segment and serving it through a strategy that
distinguishes the retailer from others in the minds of
consumers in that segment
• Neiman Marcus
• Store Image
–Atmospherics
• The physical elements in a store’s design that appeal to
consumers’ emotions and encourage buying
• Interior layout, colors, furnishings, and lighting
• Exterior storefront and entrance design, display windows,
and traffic congestion
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16–19
Strategic Issues in Retailing (cont’d)
• Scrambled Merchandising
–The addition of unrelated products and product lines to
an existing product mix, particularly fast-moving items
that can be sold in volume
–Intent of scrambled merchandising
•
•
•
•
Convert stores into one-stop shopping centers
Generate more customer traffic
Realize higher profit margins
Increase impulse purchases
–Walgreens
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16–20