Retailing
CHAPTER
15
Marketing
10
Lamb, Hair, McDaniel
Designed by
Eric Brengle
B-books, Ltd.
Copyright ©2009 by Cengage Learning Inc. All rights reserved
Prepared by
Amit Shah
Frostburg State University
1
LOI
The Role of Retailing
Retailing
All the activities directly
related to the sale of goods
and services to the ultimate
consumer for personal,
non-business use.
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2
LOI
The Role of Retailing
Over 1.6 million U.S. retailers employ more than
24 million people
Retailers account for 11.6 percent of U.S.
employment
Retailing accounts for 13 percent of U.S.
businesses
Retailers ring up almost $4 trillion in sales--nearly
40 percent of the U.S. GDP
Industry is dominated by a few giant
organizations, such as Wal-Mart
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3
LO2
Classification of Retail
Operations
Ownership
Level of Service
Product Assortment
Price
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4
LO2 Classification of Ownership
Independent
Retailers
Owned by a single person or
partnership and not part of a
larger retail institution
Chain Stores
Owned and operated as a
group by a single
organization
Franchises
The right to operate a
business or sell a product
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5
LO2
Level of Service
Self Service
Factory outlets
Warehouse clubs
Full Service
Discount stores
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Exclusive stores
6
LO2
Product Assortment
Type of Retailer
Service
Level
Assortment
Price
Gross
Margin
Department Store
Mod Hi-High
Broad
Mod-High
Mod High
Specialty Store
High
Narrow
Mod-High
High
Supermarket
Low
Broad
Moderate
Low
Convenience Store
Low
Med-Narrow Mod High
Mod High
Drugstore
Low-Mod
Medium
Moderate
Low
Full-line Discounter
Mod-Low
Med-Broad
Mod Low
Mod Low
Specialty Discounter
Mod-Low
Med-Broad
Mod Lo-low Mod Low
Warehouse Clubs
Low
Broad
Low-very low Low
Off-price Retailer
Low
Med-Narrow Low
Low
Restaurant
Low-High
Narrow
Low-High
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Low-High
7
LO2
Price
Gross
Margin
The amount of money the
retailer makes as a
percentage of sales after
the cost of goods sold is
subtracted.
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8
LO3
Major Types of Retail Operations
Department Stores
Specialty Stores
Supermarkets
Drugstores
Convenience Stores
Discount Stores
Restaurants
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9
LO3
Discount Stores
Mass
Merchandising
Retailing strategy using
moderate to low prices on
large quantities of
merchandise and lower
service to stimulate high
turnover of products.
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10
LO3
Discount Stores
Supercenter
Extreme-value
Retailing
Retail store combining
groceries and general
merchandise goods
with a wide range of services.
Smaller stores emphasizing
daily necessities at
rock-bottom prices.
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11
LO3
Specialty Discount Stores
Category
Killers
Specialty discount stores
that heavily dominate
their narrow merchandise
segment.
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12
LO4
Nonstore Retailing
Automatic Vending
Direct Retailing
Direct Marketing
Electronic Retailing
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13
LO4
Direct Retailing
Door-to-Door
Office-to-Office
Home Sales
Parties
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14
LO4
Types of Direct Marketing
Direct Mail
Catalogs & Mail Order
Telemarketing
Electronic Retailing
Shop-at-home networks
On-line retailing
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15
LO6
Retail Marketing Strategy
Define & Select
a Target Market
Develop the
“Six Ps”
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16
LO6
Defining a Target Market
Demographics
STEP 1:
Segment the Market
Geographics
Psychographics
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17
LO6
Choosing the Retailing Mix
Product
Place
Price
Personnel
Promotion
Presentation
STEP 2:
Choose the
Retailing Mix
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18
LO6
Important Factors for Site Choice
Neighborhood
socioeconomics
Traffic flows
Land costs
Zoning regulations
Public transportation
Site’s visibility, parking,
entrances and exits,
accessibility, and safety
Fit with other stores
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19
LO6 Presentation of the Retail Store
Employee type and density
Merchandise type and density
Fixture type and density
Sound
Odors
Visual factors
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