Retail Institutions Assignment  Reminder – Due October 28  Include pictures as necessary  Make sure you bring a copy of site eval checklist with you  Trip: Money MUST be paid to Roseanne Benoit TODAY Itinerary

BSAD 432 – Retail Management Retail Institutions Itinerary Fall :30 am – Students to be in parking lot at Millenium Centre to board bus 7:45 am – Depart StFX 10:00 am – arrive at Winner’s Entrance of MicMac Mall 10:00 – 10:20 am – Mall tour provided by Chris Keillor, Manager MicMac Mall and Rebecca Logan, Marketing Manager MicMac Mall 10:20 – 10:35 am - GROUP 1 presentation by Chris Keillor and Rebecca Logan, Manager, MicMac Mall 10:35 – 10:50 am - GROUP 2 presentation by Chris Keillor and Rebecca Logan, Manager, MicMac Mall 10:50 – 11:05 am - GROUP 3 presentation by Chris Keillor and Rebecca Logan, Manager, MicMac Mall 11:05 am - 12:30 pm – browse MicMac Mall to complete assignment; make sure you leave a little time to have lunch! 12:30 pm – bus departs Mic Mac Mall for Dartmouth Crossing 12: :45 pm – travel to Dartmouth Crossing 12:45 – 1:15 pm – Visit Hockey Life. Complete assignment question. 1:15 pm – bus departs Hockey Life for Sportchek 1:20 – 1:45 – Visit Sport Check. Complete assignment question. 1:45 – bus departs Sportchek for “The Shops” at Dartmouth Crossing 1:45 – 2:45 – Visit LeChateau. Browse other shops and complete assignment questions. 2:45 pm – bus departs Dartmouth Crossing for Antigonish. 5:00 pm – bus arrives on campus (parking lot at Millenium Centre)

Midterm  Wednesday October 23 rd  In class  Chapters 1,2,3,4,5,7,9,10  Review summary to be posted on Moodle Thursday, Oct. 17  Test Format – short answer conceptual questions; short/longer answer application questions

Final Exam  December 5  7:00 – 9:30 pm  Location TBA

6 Chapter 6 Non-traditional Retailing RETAIL MANAGEMENT: A STRATEGIC APPROACH,

Nontraditional Retailing  Non-store:  Direct Marketing:  Internet  Catalogue – examples?examples  TV (shopping networks, infomercials)  Direct Selling (phone, in-person)  Other (blurred store/non-store distinctions):  Video Kiosks  Vending Machines  Airport Retailing

Emerging Trends  Changing customer lifestyles  Increasing competition  Mounting interest in global direct marketing  Technological advances  Greater use of multi-channel retailing…  Perhaps even “channel obliteration”?  For bricks-and-mortar stores?  For catalogues?

Vending Machines Formerly dominated by tobacco Dominated by food in Canada 94% of $720 million in revenue Lean Machine 2005Lean Machine Lean Machine Today April Glavine, Saint Mary’s MBA Urban Vendor What items would you consider purchasing from a vending machine? New Trends: Hot food Durables (clothing, souvenirs)clothing Electronics Beauty

NON-TRADITIONAL RETAILING CLASS #2

Retail Institutions Debrief  Reminder: Assignments due Oct 28 at the beginning of class Printed version and uploaded version (1 copy per group)  Most interesting thing?  Wider learning opportunity Mainstream Media Account Another account Tensions remain high Global Frackdown

Midterm  Wednesday, October 23 rd  In Class  Format: ~50% concept: 50% application Short answer, definitions, longer answer  Reminder: If you write at the Counseling Centre, please me no later than Tuesday morning.

Airport Retailing  Vancouver International Airport Vancouver International Airport  Hong Kong International Airport Hong Kong International Airport “Airport Authority with the Most Supportive Approach to Travel-Retail” at the DFNI Asian Awards for Travel-Retail Excellence  Airport retailing is becoming increasingly significant Reduced in-air services Increased waiting times Captive audience  Impulse purchase behaviour  Reduced price sensitivity Extended hours  Potential difficulties include: Higher rent Receipt of inventory (inconvenient) Inventory storage

Multi-channel Retailing  Uses more than one channel  Studies have shown multi-channel shoppers spend more (Sears, Canada Post) and are more loyal (Berman and Thelen 2004)  Channels synergistic (JC Williams) Increased customer base, increased revenue, increased market share (Berman and Thelen 2004) 26% online Canadians make their online purchases from the same stores they shop offline (AC Nielsen 2010)  Different consumer benefits are derived from each channel  Successful multi-channel strategies are integrated Achieve integration:  Protect (initiated for competitive parity)  Evolve (become more customer centric)  Transform (customer preferences integrated throughout value chain) Internet $1 Retail $3 Catalogue $1 $ 5 $ 3 $ 5 $ 7 Name some multi-channel retailers. Do you shop all channels? What benefits do you get from each channel? Name some multi-channel retailers. Do you shop all channels? What benefits do you get from each channel?

From anywhere… to anyone It’s really all about maximizing the buying experience In-depth information Resource Personalized Dynamic Efficiency/Convenience Accessible Tactile interaction Instant gratification Human interaction Service Destination Entertainment Information Longevity Tangibility Portability Service Retail Experience Catalogue Experience Online Experience Consumers look for different experiences in the different channels Source: J.C. Williams Group

Web Retailing  Have you made a purchase online? 76% Canada’s internet users have shopped online Compared with 98% in South Korea and 97% in Japan, Germany and Great Britain And 94% in the US  What have you purchased and why? Most frequent online purchases in Canada (Dec 2009) Books DVDs Clothing/shoes Electronics Airline tickets  Resources: Stats Can data; AC Nielsen ReportStats Can data; AC Nielsen Report

Reasons Customers Buy Online  Convenience  Control  Choice  Communication  Customization (My Publisher, American Eagle, Future Shop, youbobble.ca)My Publisher  Cost*  Everlane Everlane  Update Update  Frank and Oak Frank and Oak

Reasons Retailers Use Web  Competitive necessity  Generate sales  Enhance image  Reach geographically-dispersed customers  Provide information to customers  Promotion - new products, special offers  Provide customer service (e.g., , shopping assistants)  Obtain customer feedback  Employee recruitment  Present information to potential investors, franchisees, and the media

Five Stages of Developing Retail Web Presence 1. Brochure Web Site Brochure Web Site 2. Commerce Web Site Commerce Web Site 3. Integrated Web Site Integrated Web Site 4. The ‘Webified’ Store The ‘Webified’ Store 5. Site Integrated with Manufacturer Systems

Will online retailing lead to channel obliteration?  Showrooming (handout)  More More “Despite all the complaints coming from brick and mortar retailers, most online shoppers still don’t do much “showrooming” it seems. This refers to the supposedly popular practice of visiting a retail store, looking at a product and then finding a cheaper version online. But does this really happen all that much? Not exactly. According to Lesonsky, 78 percent of online shoppers don’t look at a product in a store before buying it online. Only 12 percent look at a product in a store then buy it from the same retailer online. And just 10 percent see products in the store and later buy them elsewhere.” - Hessinger, 2013, Retail Trends

The State of Online Retailing Online sales Global Trends Canada: $18 billion (3.4%) in 2010 per BCG $3.3 billion in 2009* 0.79% retail sales (2009) * Electronic Shopping and mail-order houses Statistics Canada United States: 5.7% retail sales from Jan-Oct % retail sales from Nov-Dec 2010 US Dept of Commerce United Kingdom: 17% retail sales 2011 IMRG Capgemini’s Retail Sales Index Online sales Global Trends Canada: $18 billion (3.4%) in 2010 per BCG $3.3 billion in 2009* 0.79% retail sales (2009) * Electronic Shopping and mail-order houses Statistics Canada United States: 5.7% retail sales from Jan-Oct % retail sales from Nov-Dec 2010 US Dept of Commerce United Kingdom: 17% retail sales 2011 IMRG Capgemini’s Retail Sales Index Global E-Commerce Report

Connected, but not buying… 40% of Canadian Internet users abandoned at least one virtual shopping cart on a Canadian site. WHY? Canada most connected country in the world Canadians were the world leader in broadband adoptions Canadians spend the most time online (45 hrs/month) comScore But, online Canadians aren’t avid online purchasers relative to other countries

Reasons NOT Shopping Online 1. Browsing 2. Shipping costs too high 3. Privacy 4. Inconvenience (had to register) 5. Poor site design Fulfillment issues?? (eg. Red Envelope)Red Envelope

Will online retailing lead to channel obliteration?  Not any time soon (modest online sales)  BAM stores important for ‘showrooming’  Still a desire for instant gratification for certain product categories and social aspects of shopping  Mobile is a real risk to expensive BAM offerings, though; will force retailer efficiencies  Therefore, multi-channel is preferred.

The Value of Multi-Channel  Using the Internet is most successful when it is part of an integrated multi- channel strategy.  Mobile offerings round out multi-channel  Clicks-and-mortar retailers address the consumer's emerging preference to enjoy the same shopping experience and convenience in all channels (e.g., store, catalogue, Internet).  Internet retailing may not result in channel obliteration as once expected, but many retailers are planning substantial growth from this area. deloitte-s-geddes-says.html deloitte-s-geddes-says.html  Two challenges are:  converting browsers to shoppers regardless of the channel they choose.  repatriating the 45% of Canadian online shoppers who are buying from foreign sites. Retail Interactive (