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2. CHAPTER
RETAILING
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3. AFTER READING THIS CHAPTER YOU SHOULD BE ABLE TO:
Identify retailers in terms of the utilities they provide.
Explain the alternative ways to classify retail outlets.
Describe the many methods of nonstore retailing.
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4. AFTER READING THIS CHAPTER YOU SHOULD BE ABLE TO:
Classify retailers in terms of the retail positioning matrix.
Develop retailing mix strategies over the life cycle of a retail store.
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5. TRADING UP…AT TARGET!
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6. Consumer Utilities Offered by Retailing
THE VALUE OF RETAILING
Retailing
Consumer Utilities Offered by Retailing
The Global Impact of Retailing
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7. FIGURE 17-1 Which company best represents which utilities?
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8. FIGURE 17-2 Retail sales ($billions), by type of business
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9. Polo What consumer utility is offered?
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10. CLASSIFYING RETAIL OUTLETS
Form of Ownership
Independent Retailer
Corporate Chain
Contractual Systems
Business-Format Franchises
Product-Distribution Franchises
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11. Say Good-Bye to Bar Codes!
MARKETING NEWSNET
Say Good-Bye to Bar Codes!
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12. Radio Shack What form of retail ownership?
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13. FIGURE 17-3 The top five franchises in the United States
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14. CLASSIFYING RETAIL OUTLETS
Level of Service
Self-Service
Limited Service
Full-Service
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15. CLASSIFYING RETAIL OUTLETS
Type of Merchandise Line
Depth of Product Line
Specialty Outlets
Category Killers
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16. FIGURE 17-4 Breadth versus depth of merchandise lines
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17. CLASSIFYING RETAIL OUTLETS
Merchandise Line
Breadth of Product Line
General Merchandise Stores
Scrambled Merchandising
Hypermarket
Supercenter
Intertype Competition
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18. FIGURE 17-5 Differences between hypermarkets and supercenters
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19. Direct Mail and Catalogs
NONSTORE RETAILING
Automatic Vending
Direct Mail and Catalogs
Television Home Shopping
Online Retailing
Telemarketing
Do-Not-Call Registry
Direct Selling
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20. FIGURE 17-6 Forms of nonstore retailing
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21. Coke Vending Machine What are the strengths and weaknesses of this form of nonstore retailing?
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22. Specialty Catalogs What are the strengths and weaknesses of this form of nonstore retailing?
Sears
Lilly’s Kids
L.L. Bean
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23. QVC Television Home Shopping What are the strengths and weaknesses of this form of nonstore retailing?
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24. Online Retailing What are the strengths and weaknesses of this form of nonstore retailing?
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25. Internet Cafés What are the strengths and weaknesses of this form of nonstore retailing?
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26. Positioning a Retail Store
RETAILING STRATEGY
Positioning a Retail Store
Retail Positioning Matrix
Breadth of Product Line
Value Added
Keys to Positioning
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27. FIGURE 17-7 Elements of a retailing strategy
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28. FIGURE 17-8 Retail positioning matrix
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29. FIGURE 17-A Implications of the retailing positioning matrix
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30. ADVERTISEMENT 17-A Tiffany: A retailer in the high-value added/narrow line quadrant of the retail positioning matrix
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31. RETAILING STRATEGY Retailing Mix Retail Pricing Markup Markdown
Original Markup
Markup on Selling Price
Markup on Cost
Maintained Markup
Gross Margin
Markdown
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32. RETAILING STRATEGY Retailing Mix Retail Pricing Everyday Low Pricing
Everyday Fair Pricing
Prices as Benchmarks or Signposts
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33. RETAILING STRATEGY Retailing Mix Retail Pricing Shrinkage
Off-Price Retailing
Warehouse Club
Outlet Store
Single-Price or Extreme Value Retailers
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34. ETHICS AND SOCIAL RESPONSIBILITY ALERT
Who Takes the Five-Finger Discount? You’ll Be Surprised!
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35. 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
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36. RETAILING STRATEGY Retailing Mix Retail Communication Merchandise
Image
Atmosphere or Ambiance
Merchandise
Category Management
Consumer Marketing at Retail (CMAR)
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37. THE CHANGING NATURE OF RETAILING
The Wheel of Retailing
The Retail Life Cycle
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38. FIGURE 17-9 The wheel of retailing
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39. FIGURE 17-10 The retail life cycle
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40. FUTURE CHANGES IN RETAILING
Multichannel Retailing
Multichannel Retailers
The Impact of Technology
Changing Shopping Behavior
Vertical Malls
Co-Branding
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41. VIDEO CASE 17
Mall of America
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42. 1. Why has Mall of America been such a marketing success so far?
VIDEO CASE 17
Mall of America
1. Why has Mall of America been such a marketing success so far?
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43. VIDEO CASE 17
Mall of America
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?
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44. VIDEO CASE 17
Mall of America
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.
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45. VIDEO CASE 17
Mall of America
4. What specific marketing actions would you propose that Mall of America managers take to ensure its continuing success in attracting visitors (a) from the local metropolitan area and (b) from outside of it?
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46. Retailing
Retailing includes all activities involved in selling, renting, and providing goods and services to ultimate consumers for personal, family, or household use.
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47. Form of Ownership
Form of ownership distinguishes retail outlets based on whether individuals, corporate chains, or contractual systems own the outlet.
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48. Level of Service
Level of service is the degree of service provided to the customer and include self-, limited-, and full-service retailers.
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49. Merchandise Line
A merchandise line describes how many different types of products a store carries and in what assortment.
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50. Depth of Product Line
Depth of product line means that the store carries a large assortment of each item.
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51. Breadth of Product Line
Breadth of product line refers to the variety of different items a store carries.
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52. Scrambled Merchandising
Scrambled merchandising involves offering several unrelated product lines in a single store.
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53. Hypermarket
A hypermarket is a large store (more than 200,000 square feet) that offers consumers everything in a single outlet, eliminating the need to shop at more than one location.
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54. Intertype Competition
Intertype competition means there is competition between very dissimilar types of retail outlets.
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55. Telemarketing
Telemarketing involves using the telephone to interact with and sell directly to consumers.
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56. Retail Positioning Matrix
The retail positioning matrix is a matrix that positions retail outlets on two dimensions: breadth of product line and value added.
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57. Retailing Mix
The retailing mix includes the activities related to managing the store and the merchandise in the store, which includes retail pricing, store location, retail communication, and merchandise.
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58. Shrinkage
Shrinkage is the breakage and theft of merchandise by customers and employees.
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59. Off-Price Retailing
Off-price retailing involves selling brand-name merchandise at lower than regular prices.
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60. Central Business District
The central business district is the oldest retail setting, usually located in the community’s downtown area.
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61. Regional Shopping Centers
Regional shopping centers consists of 50 to 150 stores that typically attract customers who live or work within a 5- to 10-mile range, often containing two or three anchor stores.
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62. Community Shopping Center
A community shopping center consists of a retail location that typically has one primary store (usually a department store branch) and often 20 to 40 smaller outlets, serving a population of consumers who are within a 10- to 20-minute drive.
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63. Strip Location
A strip location consists of a cluster of stores to serve people who are within a 5- to 10-minute drive.
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64. Power Center
A power center consists of a huge shopping strip with multiple anchor (or national) stores.
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65. Category Management
Category management is an approach to managing the assortment of merchandise in which a manager is assigned the responsibility for selecting all products that consumers in a market segment might view as substitutes for each other, with the objective of maximizing sales and profits in the category.
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66. Wheel of Retailing
The wheel of retailing is a concept that describes how new forms of retail outlets enter the market.
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67. Retail Life Cycle
The retail life cycle is the process of growth and decline that retail outlets, like products, experience, which consists of the early growth, accelerated development, maturity, and decline stages.
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68. Multichannel Retailers
Multichannel retailers utilize and integrate a combination of traditional store formats and nonstore formats such as catalogs, television, and online retailing.
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