mktg321 ch15
with direct-response marketing, in general, products must be priced above ___ to justify the advertising and distribution costs
$20
in choosing a location, what do retailers look at? (4)
- relative ease to and from the site - characteristics of the site itself - rental, leasing, ownership terms - compatibility with other retailers (stores that complement each other)
what 3 things are key determinants of a store image?
- store environment - merchandise quality - service quality
department stores organize related product lines into separate departments (cosmetics, home goods, apparel, etc). this arrangement facilitates what 2 things?
1. marketing 2. internal management
3 questions to ask with starting retail stores
1. what are you going to put in your store? merchandise 2. how are you going to sell them? online or brick-and-mortar? where would the store be located? what is the website going to look like? what aisle/shelf? (atmospheric, store layout) 3. services (return policy, hours of oper, shipping costs)
retail apocalypse
23 retailers closing
personalization fell off in the early 1900s because ___
9/10 of the people can't find the help they need
category killer
a large speciality store that concentrates on a major product category and competes on the basis of low prices and broad product availability
webrooming
a practice where a shopper researches products online and then heads to the nearest store to make the actual purchase
general-merchandise retailer
a retail establishment that offers a variety of product lines that are stocked in considerable depth
catalog marketing
a type of marketing in which an organization provides a catalog from which customers make selections and place orders by mail, telephone, or the internet
LL Bean return policy
abuse, only 15% of returns were legit, lost $250 mil researched target market then changed return policy to 1 yr, got sued, negative publicity
interior atmospheric elements include ___
aesthetic considerations (such as lighting, wall and floor coverings, dressing facilities, and store fixtures)
lifestyle shopping center are often located near ___
affluent neighborhoods
Rob Stevens is the head of a company that produces computer software for production scheduling. The firm is small and presently does not generate enough volume to justify hiring a sales force. The firm is probably using ___________ to maintain contact with the firms using its products.
agents
commission merchants
agents that receive goods on consignment from local sellers and negotiate sales in large, central markets
retailing
all transactions in which the buyer intends to consume the product through personal, family, or household use
wholesaler
an individual or organization that sells products that are bought for resale, for making other products, or for general business operations
retailer
an organization that purchases products for the purpose of reselling them to ultimate customers
franchising
arrangement in which a supplier (franchiser) grants a dealer (franchisee) the right to sell products in exchange for some type of consideration
advantages of catalog retailing for retailers (3)
being able to locate in remote, low-cost areas save on expensive store fixtures reduce both personal selling and store operating expenses
speciality stores usually offer better ___ and more ___ than department stores, their main competitors
better selection and more sales expertise
category management is an important part of developing a ___
collaborative supply chain, which enhances value for customers
successful category management involves ___
collecting and analyzing data on sales and consumers and sharing the information between retailer and manufacturer
hypermarkets
combine supermarket and discount store shopping in one location
supply chain starts with ___
customers
direct selling gives the marketer an opportunity to ___
demonstrate the product in a comfortable environment where it most likely would be used
general-merchandise retailers primarily consists of what type of stores? (8)
department stores convenience stores supermarkets discount stores warehouse clubs superstores hypermarkets warehouse showrooms
location is important in strategic decision making because it ___
dictates the limited geographic trading area from which a store draws its customers
___ is not a form of direct marketing
direct selling
a channel of distribution is defined as a group of individuals and organizations that ___
directs the flow from producers to consumers driving force should be customer satisfaction
superstores combine the features of ___ and ___
discount stores and supermarkets
agents and brokers negotiate purchases and expedite sale, but do not ___. they are sometimes called ___
do not take title to products, they are sometimes called functional middlemen
which of the following does not take possession of the merchandise?
drop shippers
what is the key combo to the future of retailing?
efficiency + personalization
advantages of catalog retailing for customers (2)
efficiency and convenience
multichannel retailing
employing multiple distribution channels that complement their brick-and-mortar stores with websites, catalogs, and apps where consumers can research products, read other buyers' reviews, and make actual purchases (having multiple ways to buy something)
customers can evaluate different options when retailers ___
facilitate comparison shopping
by capitalizing on ___ (5), speciality retailers position themselves strategically to attract customers in specific market segments
fashion trends service personnel atmosphere location
which of the following is a benefit of franchising for the franchisor?
fast and selective product distribution
to keep prices lower than supermarkets and discount stores, warehouse clubs offer ___
few services, and keep advertising to a minimum
television home shopping
form of selling in which products are presented to television viewers, who can buy them by calling a toll-free number and paying with a credit card
what 2 broad categories do merchant wholesalers fall into?
full-service wholesalers limited service
speciality-line wholesalers
full-service wholesalers that carry only a single product line or a few items within a product line
limited-line wholesalers
full-service wholesalers that carry only few product lines but many products within those lines (groceries, lighting fixtures, oil-well drilling equipment)
general-merchandise wholesalers
full-service wholesalers with a wide product mix but limited depth within product lines (drugs, nonperishable foods, cosmetics, detergents, and tobacco)
rack jobbers
full-service, speciality line wholesalers that own and maintain display racks in stores (non-food w high profit margin)
two general categories of retailers
general-merchandise retailer speciality retailers
3 categories of full-service wholesalers
general-merchandise wholesalers limited-line wholesalers speciality-line wholesalers
superstores
giant retail outlets that carry food and non-food products found in supermarkets, as well as most routinely-purchased consumer products
hypermarkets typically allocate 40-50% of their space to ___ products, and the remainder to ___
grocery (40-50%) general merchandise (remainder)
key to success in retailing
have a strong customer focus with a retailing strategy that provides the level of service, product quality, and innovation that consumers desire
speciality stores may have ___ in proportion to sales, and satisfying customers may require ___
high cost in proportion to sales may require carrying products that have low turnover rates
retail positioning
identifying an unserved or underserved market segment and serving it through a strategy that distinguishes the retailer from others in the minds of consumers in that segment
to attract customers, a retail store must project an ___ that appeals to its target market
image - a functional and psychological picture in the customers mind
factory outlet malls are often placed ___
in noncompetitive locations, often outside metropolitan areas
Lowes is testing ___
in-store robots that will take you to what you need
manufacturers' agents
independent intermediaries that represent two or more sellers and usually offer customers complete product lines
merchant wholesalers
independently owned businesses that take title to goods, assume ownership risks, and buy and resell products to other wholesalers, business customers, or retailers
brokers
intermediaries that bring buyers and sellers together temporarily
selling agents
intermediaries that market a whole product line or a manufacturer's entire output
agents
intermediaries that represent either buyers or sellers on a permanent basis
department stores
large retail organizations with atleast 25 employees that are characterized by wide product mixes
supermarkets
large, self-service stores that carry a complete line of food products and some non-food products such as cosmetics and nonprescription drugs
warehouse clubs
large-scale, members-only establishments that combine features of cash-and-carry wholesaling with discount retailing (buying clubs)
mail-order wholesalers
limited service wholesalers that sell products through catalogs
drop shippers (desk jobbers)
limited service wholesalers that take title to goods and negotiate sales but never actually take possession of products (forward orders from retailers, business buyers, or other wholesalers to manufacturers and arrange for carload shipments of items to be delivered directly from producers to these customers)
truck wholesalers (truck jobbers)
limited service wholesalers that transport products directly to customers for inspection and selection
cash-and-carry wholesalers
limited service wholesalers whose customers pay cash and furnish transportation (limited line of products w a high turnover rate)
off-price retailers offer lines of ___
lines of national brand and designer merchandise, usually clothing, shoes, or housewares
___ is the least flexible variable of the marketing mix
location
discounters accept lower ___ than conventional retailers in exchange for high ___
lower profit margins high sales volume
examples of category killers (6)
lowes and home depot staples barnes & noble petco and petsmart best buy toys r us
retailer apps can foster ___ (3)
loyalty, repeat purchases, and the customer experience
online retailing
makes products available to buyers through computer connections
retailers can enhance customers' perceptions of the value of products by ___
making buyers shopping experiences easier or more convenient
wholesalers might also establish information systems that help producers and retailers ___
manage the supply chain from producer to consumer
sales branches
manufacturer owned intermediaries that sell products and provide support services to the manufacturer's sales force
sales offices
manufacturer owned operations that provide services normally associated with agents; owned by the producer
An independent businessperson who is paid a commission to sell complementary products of different producers in an assigned territory without actually taking title of the merchandise is a(n)
manufacturer's agent
a group of organizations and individuals that directs the flow of products from producers to the ultimate consumers is called a ___
marketing channel
in warehouse clubs, customers must perform some ___ by themselves
marketing functions (like transportation of purchases)
what links producers to consumers through the purchase and reselling of products or contractual agreements?
marketing intermediaries
direct selling
marketing of products to ultimate consumers through face-to-face sales presentations at home or in the workplace
3 types of wholesalers
merchant wholesalers agents and brokers manufacturers' sales branches and offices
limited-service wholesalers
merchant wholesalers that provide some services and specialize in few functions (specialty items, perishable items, construction materials, and coal)
overall costs of direct selling make it the ___
most expensive form of retailing
exterior atmospheric elements are particularly important to ___
new customers, who tend to base their judgment of an unfamiliar store on its outside appearance
many hypermarkets also lease space to ___
non-competiting businesses (banks, optical shops, fast-food restaurants)
amazon started their own line of ___
over-the-counter drugs, basic care
neighborhood shopping centers consider their target market to be ___
people who live within 2-3 miles, or 10 min driving time
full-service wholesalers
perform the widest range of wholesaling functions
telemarketing
performance of marketing-related activities by telephone
Intel made "Vaunt" which has ___
phone on glasses that gives you notifications, things show up by asking them to
wholesalers have bear the primary responsibility for the ___
physical distribution of products from manufacturers to retailers
power shopping centers may be anchored by ___
popular stores
which of the following generally does NOT have a conventional department store anchor?
power shopping center
retailers add value to the customers by ___
providing services and assisting in making product selections
beacons
real-time messages and offers sent to customers with Bluetooth-enabled smartphones
franchisor may receive ___ in exchange for ___
receive a percentage of total sales in exchange for furnishing equipment, buildings, management know-how, and marketing assistance to the franchise
warehouse showrooms
retail facilities in large, low-cost buildings with large on-premises inventories and minimal services (ikea)
category management
retail strategy of managing groups of similar, often substitutable, products produced by different manufacturers
private branding (label)
retailer themselves come up with products instead of going to gucci to purchase products to sell in-store (removes middle man, under your control)
extreme-value stores
retailers that are a fraction of the size of conventional discounted stores, and typically offer very low prices on smaller size name-brand nonperishable hosuehold items
discount stores
self-service, general-merchandise outlets that regularly offer brand-name and private-brand products at low prices (walmart, target)
producer is likely to rely on a merchant wholesalers when ___
selling directly to customers would be economically unfeasible
non store retailing
selling of products outside the confines of a retail facility
services provided by wholesalers (4)
serve as an extension of a producer's sales force provide financial assistance assist with marketing strategy especially the distribution component select inventory
convenience store
small self-service store that is open long hours and carries a narrow assortment of products, usually convenience products
community shopping centers draw consumers looking for ___
speciality products that are not available in neighborhood shopping centers
facing increase competition from department stores and other discount stores, some discounters improved ___ (3), and some even ___
store services, atmosphere, and location some even raised prices, blurring the distinction between discount store and department store
off-price retailers
stores that buy manufacturers' seconds, overruns, returns, and off-season merchandise for resale to consumers at deep discounts (tj maxx)
traditional speciality retailers
stores that carry a narrow product mix with deep product lines (limited-line retailers, or single-line retailers if they carry unusual depth in one product category)
examples of traditional speciality retailers
sunglass hut, gap, limited, foot locker
franchisee supplies ___, operates ___, and agrees to ___
supplies labor and capital, operates the franchise business, and agrees to abide by the provisions of the franchise agreement
___ has allowed retailers to take over some wholesaling functions
technology
exterior atmospheric elements include ___ (4)
the appearance of the storefront display windows store entrances degree of traffic congestion
the most successful multichannel retail strategies integrate ___ (4) seamlessly across all platforms
the firm's goals, products, systems, and technologies
atmospherics
the physical elements in a store design that appeal to customers' emotions and encourage buying
L'Occatine has ___
touch screen of all products, then select what you want to try and employee will bring them to you
Phydeaux & Friends is an independent retailer that carries deep product lines of pet supplies. This small, locally owned store is best classified as a(n) ___
traditional speciality retailer
speciality retailers (3)
traditional speciality retailers category killers off-price retailers
wholesaling
transactions in which products are brought in for resale, for making other products, or for general business operations (does NOT include transactions with ultimate consumers)
examples of direct-response marketing (3)
tv ad ad in newspaper / magazine sending letters, samples, brochures, booklets to prospects
direct-response marketing
type of marketing in which a retailer advertises a product and makes it available through mail or telephone orders
power shopping center
type of shopping center that combines off-price stores with category killers
lifestyle shopping center
type of shopping center that is typically open air and features upscale speciality, dining, and entertainment stores (market street)
community shopping centers
type of shopping center with one or two department stores, some speciality stores, and convenience stores
regional shopping centers
type of shopping center with the largest department stores, widest product mixes, and deepest product lines of all shopping centers (shopping mall)
super regional shopping centers
type of shopping center with the widest and deepest product mixes that attracts customers from many miles away (mall of america)
neighborhood shopping centers
typical shopping center typically consisting of several small convenience and speciality stores (strip center)
automatic vending
use of machines to dispense products
direct marketing
use of the telephone, internet, and nonpersonal media to introduce products to customers, who can then purchase them via mail, telephone, or the internet
what's next for how we shop?
virtual reality
Oak has ___
walk in fitting room w digital mirror to adjust lighting, give reviews, ask to try on other things. also indirectly gives data to companies to tell them what you really think of products
