Mktg 3050_Chapter 15 quiz

A "promotion strategy" includes:

- advertising - public relations - sales promotion (and the goal of this type of strategy is to help position the store in consumers' minds)

Advantages of shopping centers:

- design attracts shoppers - activities & anchor stores draw customers - ample parking - can target different demographic groups - sharing of common area expenses

Disadvantages of shopping centers:

- expensive leases - failure of common promotion efforts - lease restrictions - hours of op - anchor store domination - direct competitors

The retailing mix:

- product (width/depth) - place (distribution) - price - promotion - presentation (layout & atmosphere of stores) - personnel (customer service and personal selling)

2 basic types of franchising:

1) product & trade name 2) business format

Direct retailing:

A type of retailing in which products are sold by representatives who work door-to-door, office-to-office, or at home

Categories of Discount Stores:

Full-line specialty discount stores warehouse clubs off-price discount retailers

Kmart utilizes a strategy of moderate to low prices on large quantities of products and lower levels of service to stimulate a high turnover of inventory. Kmart offers a wide variety of different product lines. Kmart is an example of:

a mass merchandiser

Supercenter:

a retail operation that has a very large sq ft facility, that houses a florist, baker, bank, craft shop, photo finisher, dry cleaner, and pharmacy under the same roof as grocery and household items

The inclusion of social media within the retail buying experience:

allows stores such as Whole Foods and Walmart to keep customers updated on recently added items, shipments of goods that come in, and changing product details

Business format franchising:

an ongoing business relationship btwn a franchiser and a franchisee

Extreme-value retailers:

are full-line discount, off-price retailers who entice the low-and-fixed income customers who live near the store

Restaurants:

because barriers to entry are low, this type of business appeals to many

prices are usually higher in convenience stores bcs convenience stores offer these 3 benefits:

better location longer hours faster service

Telemarketing:

can consist of outbound sales calls, or inbound sales calls, which allow companies to secure orders thru toll-free telephone numbers

what is the most likely reason Kroger (the largest supermarket chain in US) sells all types of foodstuffs as well as nonfood products including a wide range of eyewear and accessories:

consumer demand for one-stop shopping often leads to scrambled merchandising

Retailing:

is defined as all activities related to the sale of goods and services to the ultimate consumer for personal, nonbusiness use or consumption

retail establishments are generally classified according to all of the following:

level of service price product assortment ownership

Advantages of free-standing stores:

low site cost or rent greater visibility no nearby competitors

Convenience stores:

miniature supermarkets that carry only a limited line of high-turnover convenience goods; offer convenient location, long hours, fast service

Shopping centers:

newest generation is the "lifestyle center

Full-line Discount stores:

offer very limited service & carry much broader assortment of well-known, nationally branded "hard goods" (toys, automotive parts, hardware, etc); some also offer perishable goods; some use mass merchandising such as Walmart

The selling technique of "trading up":

persuading customers to buy a higher-priced item than they were originally going to buy

M-commerce:

refers to the ability to shop using wireless mobile devices

The selling technique of "suggestion selling":

seeks to broaden customers' original purchases with related items

Off-price retailers:

sell at prices 25% or more below traditional dept store prices bcs it pays cash for its stock & usually doesn't ask for return privileges; these retailers buy manufacturers' overruns at cost or even less (also absorb goods from bankrupt stores, irregular merch, unsold/end of season output)

Pop-Up Shop:

stores that are open only during certain time periods (such as seasons), usually in an otherwise vacant store

Specialty discount stores:

tailor their merchandise to a specific target market; carry a much deeper but narrower assortment of specialty merchandise than does a department store

Direct marketing:

techniques used to get consumers to make a purchase from a non-retail setting (such as their home or office) (examples: direct mail, telemarketing, catalogs/mail order, M-commerce)

Product depth:

the # of different brands offered within each assortment

Gross margin:

the amount of money a retailer makes as a % of sales after the cost of goods sold is subtracted (low price = low gross margins; high price = high gross margins)

Product width:

the assortment of products offered

Franchisee:

the party in a franchise relationship that is an individual or business that is granted the right to sell another party's product

franchise:

the type of retail ownership owned and operated by an individual but is licensed by a larger supporting organization

Specialty stores such as Best Buy, Staples, Dicks Sporting Goods are often called "Category killers" because:

they can destroy the profit potential for a category of merchandise for other retailers; these are specialty discount stores that heavily dominate their narrow merchandise segment

Nonstore retailing:

this type of retailing is growing faster than in-store retailing; selling to consumers thru other means than by visiting a storethe major forms include: automatic vending, direct retailing, direct marketing, M-commerce

Key factors in choosing a site:

type of store desired (free standing, shopping center, mall) - factors include: neighborhood socioeconomic characteristics; traffic flow; land costs; zoning regs; public transp; site's visibility, entrance/exit locations, safety/security, fit with other stores

Factory Outlets:

well-known manufacturers such as Bose, Ralph Lauren, and Reebok have decided the most profitable way to dispose of out-of-season and irregular stock is to open these stores and sell their own merchandise; a subcategory of off-price retailers

Degree of product assortment:

is based on the breadth and depth of the product line (from narrow to med-narrow, to broad)

Disadvantages of free-standing stores:

could be hard to attract customers to location, no other retailers are around to share costs

Product & trade name franchising:

dealer agrees to sell in products provided by a manufacturer or wholesaler

This is the first task of developing a retail strategy:

define the target market

How target markets are often defined:

demographics geographics psychographics

Key factors in choosing a community:

economic growth potential competition geography, which is most important

The most influential factors in creating a store's atmosphere:

employee type & density merchandise type & density fixture type & density sound odors visual factors

Department stores:

house several departments under one roof; wide variety of shopping & specialty goods

New developments in retailing:

interactivity store-in-store model pop-up stores

Automatic vending:

is a low-profile, yet important form of retailing in which consumers get products out of automated machines, and this type of retailing accounts for $40 billion worth of sales each year in the US