CHAPTER 1

WHAT IS AIRPORT RETAILING

RETAILING

Business activity of selling goods and services directly to consumers.

Commercial transaction in which a buyer intends to consume the good or service through personal, family, or household use.

Sell a combination of goods and services.

CONT.

The intermediaries between manufactures and consumers, which facilitates the physical flow of goods and services too the customers.

CONTRIBUTION OF RETAILING

SUPPLYING THE RIGHT GOODS AND SERVICES TO THE CUSTOMERS

- Getting the goods demandes by customers- Customers’ wants being influence by trends and

advertising campaign. - Indirectly- tells retailers the goods and services

demanded by customers.

CONT.

FAIR PRICE OF GOODS AND SERVICES. - Provide a fair pricing on products and

services to the customers by:• Buying goods in bulk from manufacture

at discounted price• Saving the customers• Pricing the product competitively to

attract/ gain customer loyalty

-

CONT. IMPROVING THE STANDARD OF LIVING- Reflect on how well the people in the

country lives- Measured by quantity & quality of goods &

services consume by the people- Retailers provide a wide range of goods-

affordable prices - help raise the standard of living.

- satisfaction of customer, Standard of Living

TYPES OF RETAILING BUSINESS

SELLING OF PRODUCT SELLING OF SERVICES IN STORE RETAILING NON- STORE RETAILING

SELLING OF PRODUCT

Business of selling the tangible goods. Example: souvenirs kiosk, boutiques,

watch shop, supermarket and etc.

SELLING OF SERVICES

Business that provides or selling intangible product.

Example: barber, tailor, spa business, clinic..etc

IN STORE RETAILING

Selling of goods and services from a shop or permanent building.

Examples; convenience shop, supermarket, pharmacist, etc.

NON- STORE RETAILING

DIRECT SELLING- insurance agent, salesman door-to- door, milkman, bread man- peddling around the housing residence, etc.

VENDING MACHINE BUSINESS- stand alone/ well mounted to offer goods to customer. E.g, soft drinks.

TELEMARKETING- business using the telephone (communication), annoyance, telling the latest product

CONT.

MAIL ORDER- business using email as means of communication, mailing catalogue, brochures – selected customers, popular means by banks and credit card companies.

INTERNET SALES OR MARKETING- transaction carried out online, fast growing trend. E.g.- EBay, Amazon.

CONT.

BUSINESS USING SMS- done through h/p, payment & goods delivered through SMS, E.g. top-up, songs, ring tones and etc.

RETAIL FORMAT CONVINIENCE STORE SUPERMARKET MINI MARKET/ TRADITIONAL RETAILER HYPER MARKET SPECIALTY STORE BOUTIQUE SHOPS DEPARTMENT STORE

CONVINIENCE STORE

Selling convenience goods to meet the needs and wants of the local community or groups such as the travelers, students, office workers, apartment or condo residents, etc.

Size premise is approx 1,000 sq. ft. Product comprises of basic convenience dry

goods, smaller fact, impulse in nature, at affordable price.

Located at a convenient place e.g. small resident area, business premises, transport terminal, hotels, campus, petrol station.

SUPERMARKET

A self-service store offering a wide variety of food and household merchandise including meat, fresh and dairy product.

It is larger in size compared with convenience store, more than 10,000 sq.ft.

Has a wider selection of household and sundry groceries product range than a traditional grocery store.

Located mostly in a modern and affluent market catchments area such as mid-market residential area, central business district, shopping complexes, etc.

MINI MARKET/ TRADITIONAL RETAILER

A neighborhood sundry grocery shop offering a variety of food and household items including wet and fresh items.

Product range mostly confine to servicing local needs and demand. E.g. general merchandise assortment.

Located in housing areas, sub-urban and smaller town areas, office complexes, colleges, etc.

magazine and stationary shops, college kiosk, etc.

HYPER MARKET

Vast self-service warehouse-cum-retail outlet that combines the features of supermarkets, department store, discount store and specialty store in one location.

Also called hypermarket, with more than 75,000 sq.ft. of trading area, using more than 15 checkout counters, carrying more than 25,000 products.

Located in out of town vicinity, in large residential catchment areas, to have ample parking facilities.

SPECIALTY STORE

Offer a limited number of different product lines, such as women’s clothing or sporting goods, also provide their customers with an extensive selection of brands and styles within each product line.

BOUTIQUE SHOPS

A small retail shop that specializes in gifts, fashionable clothes, accessories and food.

Located within a large department store or supermarket.

Offering very specialized products and services such as an investment boutique, healthcare boutique, cosmetic clinic and etc.

DEPARTMENT STORE

A large retail store offering a variety of goods and services which organized in separate departments.

Specializes in satisfying a wide range of the consumer’s personal and residential durable goods product need.

Offering a choice of multiple merchandise lines, in all categories including apparel, furniture, electronic, paint, hardware, jewelry, toys and etc.

Department stores are usually part of a retail chain of many stores situated around a country or several countries.

HOW RETAILERS ADD VALUE???

BREAKING THE BULKS- buying the products in the quantities that the customers want.

HOLDING INVENTORY- keeping the product for the customers, make it available when customer want it.

PROVIDING ASSORTMENT- have many choices of products

OFFERING SERVICES- product display, demonstration, after sales services, deliveries..ect

AIRPORT RETAILING THE EARLY DEVELOPMENT

THE EARLY DEVELOPMENT

Started late 1980’s with negative characteristic:

Limited- retail outlet, product range Product low quality Concept of in-house brand or unbranded Monopolistic practices- not open to others Poor value of money with high product prices Airport retailing is a rip-off- inflict financial

loss

PRESENT SITUATION Airport retailing is a Sensational Understanding the customer needs and wants Developing additional space for product and

services Using specialist retail designers to improve

deco ambience Well known branded retailers/ product Downtown pricing to be shopping destination Introducing competition among retailers Improving value for money, product and

services Transforming customer perception using

communication tools- demonstration

WHO ARE THE CUSTOMERS?

The business traveler- the businessman traveling to a destination for business dealings.

The leisure travelers- those who travel for pleasure, vacation holidays, etc.

The emergency travelers- travelers because of emergency situation such as visiting sick relatives, sending children overseas, job transfers, etc.

WHAT ARE THE CUSTOMERS WANT?

Gift and souvenirs for the business traveler and tourist (leisure traveler)

Duty free goods- take advantage- make use the privileges.

Toys, chocolate, perfumes as gift to take away/ take home.

Leather and accessories (shoes, bag, etc) high quality branded merchandise for the busy business travelers.

All kinds of branded apparel Exotic snacks

WHERE THE MOST SUITABLE LOCATION & WHY?

Departure terminal- target (the senders- family and friend sending off the traveler) as well as traver.

Transit hall- target (travelers waiting for their air craft or before boarding)

Arrival terminal- target at those (family, friends) who come to pick up the travelers as well as travelers buying last minute items to take home.

WHAT IS THE MOST SUITABLE TYPE OF BUSINESS?

Selling duty free goods, the most demanded items at the airports

Selling lifestyles product such as leather, accessories, cosmetics, watches, books etc.

Souvenirs and gifts (products of remembrance for the travelers/ friends/ family/ customers)

Chocolates and snacks, easy to carry product for the family.

Latest IT & electronic goods, anew product and not available to most travelers.

HOE TO ATTRACT CUSTOMER BUYING?

A good store presentation and ambiance Having latest product range. Reasonable pricing and packaging. Warmth and friendly customer service. A good store layout, easy to find & fast check

out. A lasting impression.

WHY DOES CUTOMER BUYS?

Rational Factor- to fulfill ones needs, i.e. own consumption, buying for others, status etc.

Cultural Influence Factor- - Customs- Very busy - Values: to keep with the trend and friends - beliefs: a good buy, value for moneyo Group influence factor - Neighbors - officemate - Schoolmate - celebrity

WHY DOES CUTOMER BUYS? (CONT)

Individual Preference factors - To suit the person size and shape - Having special liking for pattern and design - Special color and preferences - Happen to like fashiono Emotional Factor

- Pleases the heart- Pleases the eye- Pleases the feel

CUSTOMER EXPECTATION

SERVICES STORE ENVIRONMENT STORE LOCATION PRODUCT PRICE

CUSTOMER EXPECTATION (CONT)

SERVICES- Quality,- Opening hours, convenience timing- Credit facilities- for big tickets items- Exchange/ return policies, portrays product

quality and customer confidence – SSM- Delivery for bulky and quantity purchases- Gift wrapping, extra service for gifts and

souvenirs goods.- etc

CUSTOMER EXPECTATION (CONT)

STORE ENVIRONMENT- Cleanliness- Air- conditioning- Restrooms- Attractive furnishing/ layout- Pleasant music- etc

CUSTOMER EXPECTATION (CONT)

STORE LOCATION- In locating retail stores, retailers consider the

market, town, and retail complex, airport terminals in which they want to establish themselves, the actual location to be in, and the actual site of their store.

- In some cases, no store is involves because the right location for shopping for a product is the temporary promotion area, the concourse or lobby area of terminal or business complex.

- Characteristic: convenience to customers, available transport service, easy to find, safe area.

CUSTOMER EXPECTATION (CONT)

PRODUCT- Retailers strive to offer the products that

appeal to the tastes of the consumer, are off good quality, and function properly.

- Should have psychological and emotional benefits, such as prestige or convenience.

- E.g. expensive watch with a well-known, visible brand name may its owner sense of prestige.

- Possible features: meet the satisfaction, easy to use(friendly), after sales services

CUSTOMER EXPECTATION (CONT)

PRICE - retailers use different pricing strategies to

attract different consumers.- E.g. some stores use low/ discounted prices to attract economy-minded customers, while some stores set higher prices to convey an upscale image.

- Quality= Price- Competitive pricing- Affordable to target market