retail market strategy
DESCRIPTION
indian retail marketing strategyTRANSCRIPT
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Retail Market Strategy
Class 3
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Strategy- The Retail Perspective
A retail strategy can be defined as ‘a clear and definite plan that the retailer outlines to tap the market and build a long-term relationship with the customers.’
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“Strategy” Is Over Used”
Retailers Talk About A Lot of Different “Strategies”Sales Strategy
Advertising Strategy
Merchandise Strategy
Location Strategy
Strategy Is Not Just Another Term for A Management Decision
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Steps Involved In Strategy Development4
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Step I- Define Organisation’s mission
The mission statement is a statement of the long-term purpose of the organisation.
Retailer’s mission statement normally highlight-
- The products and services that will be offered
- The customers who will be served
- The geographic areas that the organisation chooses to operate in
- The manner in which the firm intends to compete in its chosen markets
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Step II- Conduct A Situational Analysis
PEST analysis
- Political, Economic, Social and Technological factors
q Porter’s Five Forces
- Entry barriers, suppliers, customers, substitute products and industry rivalry
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Step III- Identifying Options/ Strategic Alternatives
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Step IV- Set Objectives8
Good objectives are measurable, are specific to time and indicate the priorities for the organisation
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Step V- Obtain And Allocate The Resources Needed To Compete
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Step VI- Develop The Strategic Plan
Target Market
Determine the Retail Mix
Positioning Strategy
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Step VII- Implement the Strategy, Evaluate and Control
For implementation
- Focus on target market
- Single minded merchandising
- Appealing displays
- Advertising in sync
- Personnel empathy
- Customer service as per target customer
To evaluate
- Periodic evaluation
- Decision about future changes
All this helps in maintaining control
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Elements in Retail Strategy
• Target Market
Customer Needs
• Retail Format
Method for Satisfying Needs
• Bases for Building Sustainable Competitive Advantage
Defending Position Against Competitors
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Analyzing McDonalds’ Retail Strategy
What Is McDonalds’:-Target market?
-Retail offering (format)?
-Bases for competitive advantage?
What Threats Might McDonald’s Face in the Future?
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Store-Based Retail Strategy Mixes
Food-OrientedùConvenience storeùConventional
supermarketùFood-based
superstoreùCombination storeùBox (limited-line)
storeùWarehouse store
General MerchandiseùSpecialty store
ùTraditional department
ùFull-line discount store
ùVariety store
ùOff-price chain
ùFactory outlet
ùMembership club
ùFlea market
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Convenience Store Strategy Mix
Location:Neighborhood
Merchandise:Medium width and low depth of assortment; average quality
Prices:Average to
Above average
Atmosphere andServices:Average
Promotion:Moderate
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Conventional Supermarket Strategy Mix
Location:Neighborhood
Merchandise:Extensive width and depth of assortment;
average quality; manufacturer, private,
and generic brands
Prices:Competitive
Atmosphere andServices:Average
Promotion:Heavy use of
newspapers, flyers, and coupons
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Food-Based Superstore Strategy Mix
Location:Community shopping center or isolated site
Merchandise:Full assortment plus
health and beauty aids and general merchandise
Prices:Competitive
Atmosphere andServices:Average
Promotion:Heavy use of
newspapers, flyers
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Supermarkets Have Come a Long Way
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Combination Store Strategy Mix
Location:Community shoppingcenter or isolated site
Merchandise:Full assortment plus
health and beauty aids and general merchandise
Prices:Competitive
Atmosphere andServices:Average
Promotion:Heavy use of
newspapers, flyers
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Box Store Strategy Mix
Location:Neighborhood
Merchandise:Low width and depth of
assortment; fewperishables; few national
brands
Prices:Very low
Atmosphere andServices:
Low
Promotion:Little or none
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Warehouse Store Strategy MixLocation:
Secondary site, often inindustrial area
Merchandise:Moderate width and
low depth of assortment; emphasis on
manufacturer brandsbought at discount
Prices:Very low
Atmosphere andServices:
Low
Promotion:Little or none
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Specialty Store Strategy MixLocation:
Business district or shopping center
Merchandise:Very narrow width and
extensive depth of assortment; average to
good quality
Prices:Competitive to Above average
Atmosphere andServices:
Average to excellent
Promotion:Heavy use of displaysExtensive sales force
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Old Navy – A Discount Power
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Traditional Department Store Strategy Mix
Location:Business district, shopping
center or isolated store
Merchandise:Extensive width and
depth of assortment; average to
good quality
Prices:Average to
Above average
Atmosphere andServices:
Good to excellent
Promotion:Heavy ad and catalog
use; direct mail; personal selling
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Full-Line Discount Store Strategy Mix
Location:Business district, shopping
center or isolated store
Merchandise:Extensive width and
depth of assortment; average to
good quality
Prices:Competitive
Atmosphere/Services:Slightly below
average to average
Promotion:Heavy on newspapers;price-oriented; selling
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Variety Store Strategy MixLocation:
Business district, shopping center or isolated store
Merchandise:Good width and some depth of assortment;
below-average to average quality
Prices:Average
Atmosphere/Services:Below average
Promotion:Use of newspapers
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Off-Price Chain Strategy MixLocation:
Business district, shopping center or isolated store
Merchandise:Moderate width and
poor depth of assortment;
average to good quality;low continuity
Prices:Low
Atmosphere/Services:Below average
Promotion:Use of newspapers;
brands not advertised;limited selling
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Factory Outlet Strategy MixLocation:
Out of the way site or discount mall
Merchandise:Moderate width and
poor depth of assortment;
low continuity
Prices:Very Low
Atmosphere/Services:Very low
Promotion:Little
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Membership Club Strategy MixLocation:
Isolated store or secondary site
Merchandise:Moderate width and
poor depth of assortment;
low continuity
Prices:Very Low
Atmosphere/Services:Very low
Promotion:Little;
some direct mail
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Flea Market Strategy Mix
Location:Isolated store
Merchandise:Extensive width and
poor depth of assortment;
low continuity; variable quality
Prices:Very Low
Atmosphere/Services:Very low
Promotion:Limited
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Why Does a Retailer Need to Focus on a
Specific Target Market?
Why Not Sell to Everyone?
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Can A Retailer Develop a Sustainable Competitive Advantage by:
Building a Store at the Best Location?
Deciding to Sell Some Hot Merchandise?
Increasing Your Level of Advertising?
Attracting Better Sales Associates by Paying Higher Wages?
Providing Better Customer Service?
Dropping the Price of Your Merchandise?
PhotoLink/Getty Images
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How to Develop a Sustainable Competitive Advantage
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Internal and External Bases for Competitive Advantage
Retail Firm嗗Low Cost
嗗Large Size嗗Efficient Distribution, Operations
嗗 Unique Knowledge嗗 Loyal Employees
Sources ofCapital
Vendors, Suppliers Customers
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What does loyalty mean?
Is It the same as liking a store?
…Going to the store frequently?
Loyalty
Digital Vision / Getty Images
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How Retailers Build Loyalty
Develop a strong brand for the store or the store brands
Develop clear precise positioning strategies
Create an emotional attachment with customers through loyalty programs
Royalty-Free/CORBIS
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International Expansion- A Growth Strategy
Export
Franchising/ Licensing
Acquisitions and Mergers
Joint Venture
Organic Growth
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The Retail Value Chain
Pentagon Player
ΠProduct
ΠPlace
ΠValue
ΠPeople and
ΠCommunications
Triangle Player
ΠSystems
ΠLogistics
ΠSuppliers
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The Retail Value Chain In India