1.51 million retailers in the US. The number of retail establishments has
remained constant
over the last 20 years, but the sales volume has increased *4.
14.67 million employees in the US are involved in retailing.
Return to Content List
In store vs. non store.
- In Home Retailing, selling via personal contacts with customers in
their own home. Avon, Electrolux, Amway, Encyclopedias.
Either cold calling, or calling on a lead.
Can demonstrate the product.
Becoming less popular, moving more toward office party plan etc, since more
dual earning families.
Party plan-Tupperware
- Telemarketing, direct selling of goods and services by phone,
generate sales leads, increase customer service, raise funds for
non-profit organizations, gather marketing data.
$13.6 bn per year telemarketing. Successful when combined with
other strategies.
Long distance telephone companies.
- Mail Order Retailing, sell by description. Compact discs. LL
Bean. Eliminate personal selling and store operations.
Appropriate for specialty products.
Key is using customer databases to develop targeted catalogs that
appeal to narrow target markets.
$57.4 b sales
Offers convenience (Place utility), no parking or long lines etc.
Buy from anywhere, retailer has low rent, small sales staff and no
shop lifting.
Postal rates increased cost of delivery by 14%.
Sears discontinued 100 year old "Big Book", $3 bn in sales. Why?
Mass marketing not in vogue.
Now Sears provides customer databases from 24 million CC users and
partners (Hanover Direct) market specifically targeted catalogs.
LL Bean ($992 million in 1 year)
Lands End
Eddie Bauer
J. Crew
- Automated Vending, less than 2% of retail sales. Most
impersonal way of retailing. Convenience Products. High repair costs,
restocking cost. Pizza.
ATMs, Purnell's basement, Restrooms, gas stations.
Price higher than in stores, consumers pay for convenience.
Personal products, no human contact.
Snapple new contract to sell its products through its own vending
machine, developing another distribution channel (dual distribution).
Pressure on cigarette industry to stop marketing cigarettes through this
channel, since it makes cigarettes available to those under 18.
- Television shopping, QVC and Home Shopping Network.
Total market currently worth $2 + bn per year, projected $25 bn by
end of decade.
Usually bargain products, but Saks 5th Avenue etc. are experimenting.
Newer networks looking to create a "store" atmosphere, as opposed
to a studio atmosphere, looking for more affluent customers.
Use has plateaued due to:
- Limited Cable Channel capacity
- Waiting for improvements in technology, i.e. interactivity.
Also Infomercials (85% fail), increased sales 20% last year, to
$900 million, used for direct sales (retailing) and increasing
store sales (advertising).
QVS and HSN developing Infomercial presence:
Sell products through home shopping network (test marketability),
create infomercials for the winners.
Impulse (TV shopping)
Court consumers (infomercials), will this strategy succeed?
- Electronic Shopping
Using computer on-line services
Problems:
Security of monetary transactions
Who is the vendor?
Prodigy
Compuserve
Return to Content List
Consumer purchases are often the results of social
influences and
psychological factors. Need to create marketing strategies to
increase store patronage.
Least flexible of strategic retailing issues and one of
the most important.
Need to consider:
- cost
- location of the target market
- kinds of products being sold
- availability of public transportation
- customer characteristics
- competitors location
- relative ease of traffic flow, incl. pedestrian
- parking and major thorough fares
- complementary stores
Handout...All Decked Out, Stores...
Discusses the recent developments in retail location, stores moving back
to urban areas. It talks about why stores are doing this, which stores
are doing this and the implications of (re) locating down-town.
Return to Content List
Wide and shallow, deep and narrow?
Look at merchandising policies.
Handout...Target `Micromarkets' its way to success...
Competition is intense. Need to identify an undeserved market segment
and service the segment distinguishing yourself from others in the minds
of consumers, IE position as high price, high quality with many services,
or reasonable quality at "everyday low prices".
Describes the physical elements in a store's design that appeals to
consumers and encourages consumers to buy. Warm, fresh, functional exciting.
Exterior Atmospherics-store front, display windows, important to
attract new customers. Surrounding businesses, look of the mall
etc.
Interior Atmospherics-lighting, color, dressing room facilities etc
Displays enhance and provide customers with information.
Need to determine the atmosphere that your target market seeks.
Return to Content List
Mental picture that a retailer tries to project to the
consumer. To a consumer, it is a persons attitude towards a store.
Need to project an image, a functional and psychological image in
consumer's minds that is acceptable to the target market. Depends
on the atmospherics, reputation, number of services offered,
product mix, pricing etc.
FAO Schwartz "It is important to leave people with a memorable
image of your store. At Disneyland, its Cinderellas castle. For
us, its the clock."
Return to Content List
Handout...Department Stores target...
Importance of relationship
marketing in order to target your loyal customers.
Handout...How Wal-Mart Outdid A Once Touted Kmart in Discount Store Race.
Discusses the issues that are related to the growth in Wal Mart, and the
decline in Kmart. Specifically logistical issues, information
technologies that managed inventory systems, location etc.
Return to Content List
Go to Chapter 1 Notes
Go to Chapter 2 Notes
Go to Chapter 3 Notes
Go to Chapter 6 Notes
Go to Chapter 9 Notes
Go to Chapter 8 Notes
Go to Chapter 10 Notes
Go to Chapter 11 Notes
Go to Chapter 12 Notes
Go to Chapter 15 Notes
Go to Chapter 17 Notes
Go to Chapter 18 Notes
Go to Chapter 19 Notes
Go to Chapter 20 Notes
Go to Chapter 13 Notes
Go to Chapter 24 Notes