Aug 23, 2014
MEANING
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• Retail is the sale of goods and services from individuals or businesses to the end-user. Retailers are part of an integrated system called the supply chain. A retailer purchases goods or products in large quantities from manufacturers directly or through a wholesale, and then sells smaller quantities to the consumer for a profit. Retailing can be done in either fixed locations like stores or markets,door-to-door or by delivery.
Organised VS Unorganised Retailing
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OVERVIEW
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10%- GDP8%- EMPLOYMENT95%- UNORGANISED REAILINGORGANISED PENETRATION LEVEL 85%- US 80%- FRANCE 66%-JAPAN 20%- CHINA 5-6%- INDIA
Types by products
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• Food products — typically require cold storage facilities.
• Hard goods or durable goods ("hard-line retailers") — appliances, electronics, furniture, sporting goods, etc. Goods that do not quickly wear out and provide utility over time.
• Soft goods or consumables — clothing, apparel, and other fabrics. Goods that are consumed after one use or have a limited period (typically under three years) in which you may use them.
Types of retailers outlets
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Department Store Supermarkets Warehouse retailers Speciality Retailers E-tailer Convenience Retailer Discount Retailer
Services Offered by Retailers
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Three Basic Tasks of Retailing
LO 1
Selling Process in the Retail Environment
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Customers Point Of View 19-
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Self serviceSelf selectionLimited serviceFull service
World’s top retailers 19-
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Wal-MartKrogetTargetWalgreenCostcoHome depotCVS caremarkLowe’sBest buy
India’s top retailers 19-
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Pantaloon retailK Raheja groupTata groupRPG groupLandmark groupBharti wall martReliance
Retail pricing 19-
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Cost plus pricingSuggested retail pricing
Transfer mechanism 19-
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Counter priceDeliveryOrderDoor to doorSelf serviceDigital delivery
BPO SERVICES For Retail Industry 19-
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RetailStrategy
The main focus:The main focus:Bringing harmony between the controllableBringing harmony between the controllable
variables and the uncontrollable ones.variables and the uncontrollable ones.Uncontrollable variables drive the controllable ones!Uncontrollable variables drive the controllable ones!
Developing an Overall Retail Strategy
Retail Marketing Mix:Retail Marketing Mix:Controllable FactorsControllable Factors
Competition & Environment:Competition & Environment:Uncontrollable FactorsUncontrollable Factors
What’s the3rd element
of retailStrategy?
TargetMarket
ControllableVariables
Store Location Store Format & Layout
Merchandise Management Pricing
Communications
UncontrollableVariables
Consumers Competition Technology
Economic Conditions Seasonality
Legal Restrictions
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Composition of key elements
PlaceProductPricePromotionPeopleProcessPhysical Environment
Key Element
Place (store location)Target marketChannel structureChannel managementRetailer imageRetail logisticsRetail distribution
Key element
Product (merchandise)Product developmentProduct managementProduct features and benefitsBrandingPackagingAfter-sales services
Key element
PriceCostsProfitabilityValue for moneyCompetitivenessIncentivesQualityStatus
Key element
PromotionDeveloping promotional mixesAdvertising managementSales promotionSales managementPublic relationsDirect marketing
Key element
People elementStaff capabilityEfficiencyAvailabilityEffectivenessCustomer interactionInternal marketing
Key element
Process elementOrder processingDatabase managementService deliveryQueuing systemStandardisation
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Customer Service 19-
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The set of activities and programs undertaken by retailers to make the shopping experience more rewarding for their customers. These activities increase the value customers receive from the merchandise and service they purchase.
Strategic Advantage Through Customer Service
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• Good service keeps customers returning to a retailer and generates positive word-of-mouth communication, which attracts new customers
• The challenge of providing consistent high-quality service offers an opportunity for a retailers to develop a sustainable competitive advantage
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Customer Service Strategies
Personalized ApproachGreater benefits to customers
Greater inconsistency
Higher cost
Standardized ApproachLower cost
High consistency
Meets but does not exceed expectations
Personalized Approach 19-
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Personalized Approach encourages service providerto tailor the service to meet each customer’s personal needs.
Drawback: Service might be inconsistent
Customized service is costly
Standardization 19-
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Standardization Approach is based on establishing a set of rules and procedures and being sure that they are implemented consistently.
Retailers that use this approach:
McDonald’s Wal-Mart IKEA Dollar General Save-A-Lot
The McGraw-Hill Companies, Inc./John Flournoy, photographer
Perceived Service 19-
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Cues used to assess service
Reliability
Assurance
Tangibility
Empathy
Responsiveness
Perceived Services – evaluations are based on perception
Assessing Service Characteristics 19-
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Reliability: accuracy of billing, meeting promised delivery dates
Assurance (trust): guarantees and warranties, return policies
Tangibility: appearance of store and salespeopleEmpathy: personalized service, receipts of notes
and emails, recognition by nameResponsiveness: returning calls and emails,
giving prompt service
Challenges 19-
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Recent trends In 2013 19-
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