© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/IrwinSlide 17-5 TRADING UP…AT TARGET!

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 17-5

TRADING UP…AT TARGET!

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 17-8

FIGURE 17-2 FIGURE 17-2 Retail sales ($billions), by type of business

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 17-13

CLASSIFYING RETAIL OUTLETS

• Form of Ownership

Independent Retailer

Corporate Chain

Contractual Systems

• Business-Format Franchises

• Product-Distribution Franchises

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin

MARKETING NEWSNET

Say Good-Bye to Bar Codes!

Slide 17-14

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 17-15

Radio Shack What form of retail ownership?

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 17-16

FIGURE 17-3 FIGURE 17-3 The top five franchises in the United States

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 17-17

CLASSIFYING RETAIL OUTLETS

• Level of Service

Self-Service

Limited Service

Full-Service

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 17-18

CLASSIFYING RETAIL OUTLETS

• Type of Merchandise Line

Depth of Product Line

• Specialty Outlets

• Category Killers

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 17-19

FIGURE 17-4 FIGURE 17-4 Breadth versus depth of merchandise lines

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 17-20

CLASSIFYING RETAIL OUTLETS

• Merchandise Line

Breadth of Product Line

• General Merchandise Stores

• Scrambled Merchandising

• Hypermarket

• Supercenter

• Intertype Competition

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 17-21

FIGURE 17-5 FIGURE 17-5 Differences between hypermarkets and supercenters

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 17-25

NONSTORE RETAILING

• Automatic Vending

• Direct Mail and Catalogs

• Television Home Shopping

Do-Not-Call Registry

• Online Retailing

• Telemarketing

• Direct Selling

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 17-26

FIGURE 17-6 FIGURE 17-6 Forms of nonstore retailing

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 17-27

Coke Vending Machine What are the strengths and weaknesses

of this form of nonstore retailing?

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 17-28

Specialty Catalogs What are the strengths and weaknesses

of this form of nonstore retailing?

Sears L.L. BeanLilly’s Kids

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 17-29

QVC Television Home Shopping What are the strengths and weaknesses

of this form of nonstore retailing?

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 17-30

Online Retailing What are the strengths and weaknesses

of this form of nonstore retailing?

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 17-32

Internet Cafés What are the strengths and weaknesses

of this form of nonstore retailing?

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 17-37

FIGURE 17-7 FIGURE 17-7 Elements of a retailing strategy

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 17-38

FIGURE 17-8 FIGURE 17-8 Retail positioning matrix

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 17-39

FIGURE 17-A FIGURE 17-A Implications of the retailing positioning matrix

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 17-40

ADVERTISEMENT 17-AADVERTISEMENT 17-A Tiffany: A retailer in the high-value added/narrow line quadrant of the retail positioning matrix

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 17-41

RETAILING STRATEGY

• Retailing Mix

Retail Pricing

• Markup

• Markdown

Original Markup

Maintained Markup

Gross Margin

• Markup on Selling Price

• Markup on Cost

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 17-42

RETAILING STRATEGY

• Retailing Mix

Retail Pricing

• Everyday Low Pricing

• Everyday Fair Pricing

• Prices as Benchmarks or Signposts

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 17-43

RETAILING STRATEGY

• Retailing Mix

Retail Pricing

• Shrinkage

• Off-Price Retailing

Warehouse Club

Outlet Store

Single-Price or Extreme Value Retailers

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 17-44

ETHICS AND SOCIAL RESPONSIBILITY ALERT

Who Takes the Five-Finger Discount? You’ll Be Surprised!

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 17-45

RETAILING STRATEGY

• Retailing Mix

Store Location

• Central Business District

• Regional Shopping Center

Anchor Stores

• Community Shopping Center

• Strip Location

• Power Center

• Carts, Kiosks, and Wall Units

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 17-47

RETAILING STRATEGY

• Retailing Mix

Retail Communication

• Category Management

• Image

• Atmosphere or Ambiance

Merchandise

• Consumer Marketing at Retail (CMAR)

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 17-51

THE CHANGING NATUREOF RETAILING

• The Wheel of Retailing

• The Retail Life Cycle

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 17-52

FIGURE 17-9 FIGURE 17-9 The wheel of retailing

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 17-53

Taco Bell Where is it on the wheel of retailing and

the retail life cycle?

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 17-54

FIGURE 17-10 FIGURE 17-10 The retail life cycle

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 17-55

FUTURE CHANGES IN RETAILING

• Multichannel Retailing

Multichannel Retailers

• The Impact of Technology

• Changing Shopping Behavior

Vertical Malls

Co-Branding

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 17-66

VIDEO CASE 17Mall of America

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 17-67

1. Why has Mall of America been such a marketing success so far?

VIDEO CASE 17Mall of America

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 17-68

2. What (a) retail and (b) consumer trends have occurred since Mall of America was opened in 1992 that it should consider when making future plans?

VIDEO CASE 17Mall of America

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 17-69

3. (a) What criteria should Mall of America use in adding new facilities to its complex? (b) Evaluate(i) retail stores, (ii) entertainment offerings, and (iii) hotels on these criteria.

VIDEO CASE 17Mall of America

© 2006 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Slide 17-70

4. What specific marketing actions would you propose that Mall of America managers take to ensureits continuing success in attracting visitors (a) from the local metropolitan area and (b) from outside of it?

VIDEO CASE 17Mall of America