RETAIL MARKETING SOFT COPY NOTES FOR THE TEST

After post liberalization Manufacturers started to identify the customers.

Needs -> Demands -> Desires

Manufacturing industry boosted the growth of service industry.

Definition: Retail It is the last activity in your economic chain.

Farmers -> Manufacturing -> Wholesalers -> Retailers -> To the end consumer is called the service value cycle.

Consumer & Customer are different. Consumer is a person who finally uses the product / services however, a customer can further go and sell the product / services and for a price to the consumer.

Evolution of retail is mainly due to the manufacturing and awareness amongst the people is boosting towards emergence of the market

Retail chain of India is the world’s largest chain market.

Eg: Some of the oldest chain are :

PDS : Public distribution system – approx 4.5 lac

IPO : Indian postal office – approx 1.5 lac

CSD: Canteen and stores dept – approx 6500

KVIC: Khadi Village Industry : approx 5000

There exists organized and unorganized retail market in India.

Regulatory authorities:

51% equity holding with only single brand company. Govt not recognizing organized retail market as an industry and hence no subsidies or

tax concession. Organised retailing is still taking a shape and reviving Merits and demerits of FDI in the retail marketing industry. FII’s not directly allowed to enter. They can only enter by Joint ventures.

Cash n Carry: eg. Bharti Walmart, Best Prices and Easy way etc.

‘Metro’ as a cash n carry cannot sell to the end consumer and at the same time organized retail outlets like big bazaar, shopper’s stop cannot sell to the retailers.

Challenges faced by Retailers:

Industry status Real estate price – 40% cost expenses. Inventory: 25% of the cost is blocked. Infrastructure – Power, Road etc. Skilled labour : Office / people Cold chain storage Taxation: Central Govt – Taxes @ 30% and State Govt – Octroi etc.

For the retailer the only way to earn profits is to increase the volume

Hire nice people and teach them how to sell rather than hire sales person and teach them how to be nice.

For COKE, when it entered India, the major competitors were the Nimbu Pani, Sugar Cane juice centres, Water and Tea… in the market.

24 th October 2010.

Retailing and marketing is it same or different and how is it different:

Marketing:

Customer have their own Aspiration – Desire – Want1. Understand the needs and wants2. Product availability3. Satisfy the needs of the consumer4. Earn profit out of it.

Retailing: It is the end of the economic activity.

Organised retail all about marketing.

STDP: Segmenting, Targeting, Differentiating and Positioning.

Difference between product and service is – Product are tangible and Service are intangible.

Big bazaars have low price, low margins and high volumes.

Mcdonalds – provide service because customer goes there because of quick service to us.

Big bazaar, Life styles, and Shoppers stop sell you products which give you a shopping experience.

A company is selling a Product or service can be differentiated based on the level of tangibility and how the compay is positioning itself in the market.

Most of the retail outlets are all into service industry while only the manufacturers are in the product industry.

Backward Integration by a company:

Expand Control Efficiency Understanding Pricing Cost effective

Forward Integration by a company:

Informing channel partners Create awareness Educate the customers to purchase and consume the product

Customer Centricism: Asking questions to the consumer like …..Why you need and why you want. Focusing on the pain areas of the consumer and then come out with a solution which leads to more innovation.

Customer Focus: Satisfying the needs and wants.

All of the modern retail market is all service driven.

Marketing Mix: 4P’s – Product , Price, Place and then Promotion.

When service is included in the marketing mix:

They become 8P’s viz, Product , Price, Place and then Promotion Packaging, Process, People, Physical evidence.

Any company can replicate the Product, price, place, promotion, packaging, process and physical evidence however, they would not be able to replicate the people because consumer behaves differently at each situation.

Retail Mktg Strategy:

Retail marketing mix is to use the 8P’s .

Try and get the first time would help you save a lot of money.

Strategies of retail marketing is different from the actual marketing.

Retail strategies can be done at Primary and secondary areas.

Primary Areas:

LOCATION: Location plays major criteria. Figure out the key areas, focus of the retail marketing first. Getting footfalls is also really important i.e. attracting customers.

High Traffic density area: eg. Shopping malls. Every mall must identify one anchor which would drive the entire mall shops. Eg. Big bazaars.

Profile of mall and the anchor of the mall must go hand in hand. Know the objectives right. High Drawing power: The decision has to be taken as “Whether the product has

a Drawing power. Does it have a high or a low Drawing power. And then target whether it should target under the High Traffic Density area or a Low Traffic Density area.

Four types of markets: Hyper market and super market which are differentiated based on the size and hence the variety plays a major role. Also the discounted market like the dollar shops also exists along with the convenience market like the 6/10 which actually opens at 6in the morning and closes at 10 in the night. These convenience markets can charge a higher price as commodities are made available to the consumer at very early stage of the market opening and also till late night.

Merchandising: Range of your products would define your merchandising. Assortment & Variety are two concepts used in merchandising Assortment looks at a micro view like the length and depth of the product. Variety looks at a macro view viz, the colour and design of the product.

PRICE: Every day low pricing is a concept used in pricing. Pricing strategy is made in such a way that on one day the prices would be low. Eg. Subhiksha. However, big bazaars have it on discounted pricing.

Communication: Who is my customer. The theme which will be used as talking by the company should be portrayed thru proper communication.

Integrated marketing communication. 1. Identical2. Consistent3. Reach out to the consumers4. Which medium should be selected. 5. Social websites.6. What do I want to communicate

Customer Service : Whatever, the company is involved into, it should not forget its core services. Never miss out on your core service and make sure they are delivered at any point of sale. Consistency is important while driving your customer.

Secondary retail strategy: Purchase. Logistics Technology Finance Operations

Logistics: Supply chain management i.e from Farm to Fork is followed. Purchases: Front end level purchase to reduce cost. Operations: Just in time concepts to be used. Finance: try to make sure your working capital is running smoothly. Technology: It should be seen that investment made on the automation, your

inventory management and the counter sales are innovated and automated.

The retail sector is one of the most competitive in the business world, and so effective marketing strategy is needed in order to be successful. However, many retailers get caught up in the day-to-day running of their companies and don't use all their business strategy expertise to push their business forward. If you are in the retail business, then you need to wake up and think carefully about your current marketing strategy. If you don't you could find yourself trailing behind the competition and losing business to other retailers. If you want to improve your retail marketing strategy, then here is some advice to get you started.

Use the Internet

With the Internet increasing in popularity all the time, it is extremely important to use Internet marketing as a way to improve market share. In order to improve your access to customers, create a web site where customers can view your merchandise and possibly buy products online. Selling your products online is a great way of expanding your business without having to spend lots of money on new premises or retail locations. However, if you don't want to develop online business, then you can still advertise your business online. Effective marketing strategy should use all mediums available to improve business exposure, and with online advertising a low cost and effective medium it makes sense to take advantage of the opportunity.

Offer a promotion

Retail business is extremely competitive, and so even the smallest of promotions can give you an edge over your competitors. Your business strategy should be to come up with regular and innovative promotions to entice customers into your store. These promotions can range from offering a free gift with certain products to a competition entry when certain items are purchased. If you keep your marketing strategy fresh with new promotions then you will definitely remain competitive and will attract customers to your products.

Signage and storefront are important

Although you can use plenty of complex marketing strategy techniques to attract customers, nothing is simpler and more effective than having a bold and effective storefront and signage. If you have a shop window, then keep the displays up to date and imaginative. Change the display each season and alter your sign every few years to keep things looking good. However, make sure that you keep the signage them constant so that your brand and store are easily recognisable. Make sure your sign can be seen from as far a distance as possible. Sometimes, the simplest marketing strategies are the best, and keeping your store bright and attractive is one such method.

Ask customers what they want

Your marketing strategy ideas might be great, but if you really want to improve your business then you need to ask the people that matter most - the customers. Effective marketing strategy should always begin by asking customers what sort of products, services and promotions they want. This will give you a better idea of how to market your products and improve your customer base. If there is one thing you should learn about effective business strategy, it is to listen to your loyal customers and then cater to their needs through effective marketing strategy.