What marketing decisions do

these marketing intermediaries

make ?

Monarch LakhanpalNIT Jalandhar

Until a target market is not defines , consistent decisions

cannot be made about product assortment , décor and

advertisements .and service levels

Fashion and You , the online retail portal has found success by offering brands at discounted prices to its customers

Channels

Fabindia reaches individuals and institutional buyers with its unique ethnic offerings through multiple channels.Some of which includes Internet , stores and catalogs

Product Assortment

( A)

( B )

( C )

( D )

Product assortment is done on basis of1)Length2)Breadth

(a)Narrow and shallow assortment –Small lunch

counters(b)Narrow and deep

assortment-Delicatessen

(C)Broad and shallow assortment –Cafeteria

(d) Broad and deep assortment -Restaurant

Some possibilities of product assortment :

•Feature Exclusive national brands that are not available at competing retailers –Wills Lifestyle has added Wills Luxuria, an expensive men’s wear range .

•Feature mostly private labelled merchandise –Benetton and GAPmostly carry privately labelled clothing in their stores.

•Feature surprise or ever changing merchandise –Men’s Wearhouse offers a surprise assortment of export surplus at heavy discounts .

Feature blockbuster distinctive merchandise events

Bloomingdale’s ran a month

long celebration for the Barbie doll’s 50thanniversary

Feature the latest or newest

merchandise first

ZARAexcels in and profits from being first to market with appealing new looks

Offer a highly

TargetedAssortme

nt

Use of computers to track inventory , compute economic order quantities , order goods and

analyse money spent on vendors and products.

Radio frequency Identification ( RFID )- Is used to to monitor inventory and track goods

in real time .

Direct product profitability ( DPP )- to measure a product’s handling costs from the time it reaches the warehouse until a customer buys it in the retail store.

All retailers want HIGH (turns X earns)

But both do not go together

Most of then fall into :(1) high markup–lower volume(2) low markup–higher volume

Pre-purchase services

Post-purchase services

Ancillary services

Different essence in every department of store makes your store stand -out

Store atmosphere

Store Activities and experiencesThere has started a fight between Internet and Store shopping.

Stores can use this fact as a plus point .Customers can first experience the product and then buy which is not possible

in online shopping

Panasonic and Sony create a Home like environment at their stores to let their customers experience their home theatre

Communications

Ads in magazines like Vogue, Vanity Fair etc

•Discount coupons •Membership cards •Special sales on

holidays

LOCATION

Stores at Central business districts

Regional shopping centre

(1)Shopping Strips(2)Store inside a large store(3)Stand alone stores

(1)Shopping Strips

(2)Store inside a

large store3)Stand alone stores

Logistics Decisions

0rder processing

How should we handle Orders?

Lower cycle time between Order and payment

Higher customer satisfaction

Higher profit

WAREHOUSING

Where would we locate our stocks? ?

1 Consumer packaged good companies

2 Medical Distributers

More stocking

Faster DeliveryBut , Higher Cost

To reduce costs : •Centralize the inventory •Use faster transport •Assembly, packaging , and constructing promotional display in the plants itself

INVENTORY COST:

cost related to storing, maintaining its inventory over a period of time .Increases at an accelerating rate

ORDER POINT:

-- inventory draws down(at what level to place a new order).-Should maintain the balance.

-Balance the risks(stock-out against the cost of overstock)

Order processing cost-stable setup costs, running costs(of items)

a. Low setup cost- stable average cost

b. High setup cost- reduce the average cost

•Larger the quantity ordered, less frequently an order needs to be placed

•ORDER-PROCESSING COST, compared with INVENTORY CARRING COSTS.

•Order processing cost and inventory:

carrying costs sum up at different order levels graph.

•POSITIONING OF INVENTORY ITEMS-according to risk and opportunity.

-bottleneck items(high risk, low opportunity)-critical items(high risk, high opportunity)-Commodities items(low risk, high opportunity)-Nuisance items(low risk, low opportunity)

•NEAR ZERO INVENTORY STRATEGY-build for order, not for stock also known as SOMO, “sell one, make one.”

Criteria to keep in mind while for shipping :

•Speed•Frequency•Dependability

•Capability•Availability•Traceability•Cost

Containerization

consists of putting goods

in boxes or trailers that are easy to

carry between two

transport modes.

Fishyback

Trainship

PiggybackAirtruck