RETAILING
Professor Chip Besio
Cox School of Business
16-1
RETAILERS ARE REINVENTING THEIR STORES
TO MATCH THE WAY YOU WANT TO SHOP!
16-2
RETAILERS LOVE IT
WHEN THE MAYOR VISITS!
16-3
THE VALUE OF RETAILING

Retailing

Consumer Utilities Offered by Retailing

• Place
• Form
• Possession
• Time
The Global Economic
Impact of Retailing
16-4
Which retailer best provides which utilities?
16-5
The relative size of different types of
retailers
16-6
CLASSIFYING RETAIL OUTLETS
FORM OF OWNERSHIP

Independent Retailer

Corporate Chain

Contractual Systems
• Wholesaler-Sponsored Voluntary Chains
• Retailer-Sponsored Cooperatives
16-7
CLASSIFYING RETAIL OUTLETS
FORM OF OWNERSHIP

Contractual Systems
• Franchising
 Business-Format
Franchises
 Product-Distribution
Franchises
16-8
The top five franchises in the United States
16-9
CLASSIFYING RETAIL OUTLETS
LEVEL OF SERVICE

Self-Service

Limited Service

Full-Service
16-10
Stores vary in terms of the breadth and
depth of their merchandise lines
16-11
CLASSIFYING RETAIL OUTLETS
TYPE OF MERCHANDISE LINE

Depth of Product Line
• Specialty Outlets
• Category Killers
16-12
CLASSIFYING RETAIL OUTLETS
TYPE OF MERCHANDISE LINE

Breadth of Product Line
• General Merchandise Stores
• Scrambled Merchandising
 Hypermarket
 Supercenter
 Intertype Competition
16-13
Hypermarkets are popular in Europe and
Latin America while supercenters are
popular in the U.S.
16-14
For Lands’ End, intertype competition
means that there is competition between
various dissimilar retail outlets
16-15
Many retailing activities do not involve a
store
16-16
NONSTORE RETAILING

Automatic Vending

Direct Mail and Catalogs
16-17
NONSTORE RETAILING

Television Home
Shopping

Online Retailing
16-18
GOING ONLINE
For Some Consumers, Shopping is a Game!
Shopping “Bots” find best prices
16-19
NONSTORE RETAILING

Telemarketing
• Do-Not-Call Registry

Direct Selling
16-20
Elements of a retailing strategy
16-21
RETAILING STRATEGY
POSITIONING A RETAIL STORE

Retail Positioning Matrix
• Breadth of Product Line
• Value Added
16-22
The four positioning strategies for retailers
16-23
RETAILING STRATEGY
RETAILING MIX

Retailing Mix

Retail Pricing
• Original Markup
• Maintained Markup
• Gross Margin

Markdown
16-24
RETAILING STRATEGY
RETAILING MIX

Everyday Low Pricing (EDLP)

Everyday Fair Pricing

Benchmark or Signpost Items

Shrinkage
16-25
RETAILING STRATEGY
RETAILING MIX

Off-Price Retailing
• Warehouse Club
• Outlet Store
• Single/Extreme Value Store
16-26
RETAILING STRATEGY
RETAILING MIX

Store Location
• Central Business District
• Regional Shopping Centers
 Anchor Stores
• Community Shopping Center
• Strip Mall
• Power Center
16-27
RETAILING STRATEGY
RETAILING MIX

Retail Communication
• Image
• Shopper Marketing

Merchandise
• Category Management
• Marketing Metrics
 Sales per Sq. Ft.
 Same Store Sales
16-28
USING MARKETING DASHBOARDS
Why Apple Stores May Be
the Best in the United States!
Sales per Square Foot ($) and Same Store Sales Growth (%)
Sales per Square Foot ($) =

Total Sales ($)
Selling Area in Square Feet (#)
 Store Sales Year 2 ($) Š Store Sales Year 1 ($)
Same Store Growth (%) = 
Store Sales Year 1 ($)



 100
16-29
THE CHANGING NATURE OF RETAILING
THE WHEEL OF RETAILING AND RETAIL LIFE CYCLE

Wheel of Retailing

Retail Life Cycle
16-30
The wheel of retailing describes how outlets
change over time
16-31
The retail life cycle describes the stage of
growth and decline for retail outlets
16-32
FUTURE CHANGES IN RETAILING

Multichannel Retailers

Managing the Customer Experience
16-33
MARKETING MATTERS
The Multichannel Marketing Multiplier
16-34
MAKING RESPONSIBLE DECISIONS
GREEN ISN’T JUST A COLOR TO RETAILERS.
IT’S A VALUE!
16-35