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retailing

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encompasses the business activities involved in selling goods and services to consumers for their personal, family, or household use. ex. outlets

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channel of distribution

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all of the businesses and people involved in the physical movement and transfer of ownership of goods and services from product to consumer.

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sorting process

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retailers collect an assortment from various sources, buy in large quantities, and sell in small amounts

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multi-channel retailing

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whereby a retailer sells to consumers through multiple retail formats( points of contact) ex. online, toll free phone, mail order Walmart.

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exclusive distribution

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whereby suppliers make agreements with one or a few retailers that designate the latter as the only ones in specified geographic areas to carry certain brands or products. helps both parties to work together to maintain image, assign shelf space, etc. ex.lambagini, designer

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intensive distribution

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whereby suppliers sell through as many retailers as possible retailers will have more products but that can also create little self space, lack of ads, and set high prices. most volatile to channel relation ex. tea shops, cigarettes.

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selective distribution

answer

suppliers sell through a moderate number of retailers. combines both previous suppliers. have higher sales than exclusive and intensive. retailers carry some competing brands. ex.????

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retail strategy

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overall plan guiding a retail firm. it influences the firm's business activities and its response to market forces. 1. customer orientation 2. coordinated effort 3. value driven 4. goal orientation

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total retail experience

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includes all the elements in a retail offering that encourage or inhibit consumers during their contact with a retailer. ex. sales taxes can't be controlled, people can. build-a-bear

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customer service

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refers to the identifiable but sometimes intangible activities undertaken by a retailer in conjunction with basic goods and services it sells.

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relationship retailing

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whereby they seek to establish and maintain long term bonds with customers rather than act as if each sales transaction is a completely new encounter.

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canned sales presentation

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memorized, reptitive speech given to all customers interested in an particular item. works great if little assistance is required

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need-satisfaction approach

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based on the principle that each customer has different wants; thus, a sales presentation should be geared to the demands of the individual customer.

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sales promotion

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encompasses the paid communication activities other than advertising, PR, and personal selling that stimulate consumer purchases and dealer effectiveness. ex. contests, sweepstakes, coupons

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situation analysis

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candid evaluation of the opportunities and threats facing a prospective or existing retailer. what is the firm's current status? what direction should we be heading?

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opportunities

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are marketplace openings that exist because other retailers have not yet capitalized on them. ex. IKEA huge selection at discount

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threats

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environmental and marketplace that can adversely affect retailers if they don't react to them and sometimes even if they do. ex. single screen movie theaters

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organizational mission

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retailer's commitment to a type of business and to a distinctive role in the marketplace should have clear mission

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sole proprietorship

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unincorporated retail firm owned by on person all risks, profits, and costs accrue to that individual.- 75% retail

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partnership

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unincorporated retail firm owned by two or more persons, each with fiancial interest. partners share everything. 5% of all retail firms

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corporation

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retail firm that is formally incorporated under state law. it is a large entity apart from individual officers( stockholders) have more government rules. 20% of US retail firms.ex. Coke

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goods/service category

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the line of business- in which to operate ex. Jaguar dealers luxury auto cater to upscale customers

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objectives

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long run and short run performance targets it hopes to attain profit may be expressed in dollars or as a percentage of sales.

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caveat emptor

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let the buyer beware

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image

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represents how a given retailer is percieved by consumers and others ex. brand seen as conservative

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positioning

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retailer devises its strategy in a way that projects an image relative to its retail category and its competitors and that elicits a positive consumers response. ex. Women's store has to position itself as an upscale or discount retailer

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mass merchandising

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a positioning approach where by retailers offer a discount or value- oriented image, a wide/ deep merchandise selection and large store facilities. ex. Walmart has deep merchandise while Dicks has a narrower, deeper assortment.

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niche retailing

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retailers identify specific customer segments and deploy unique strategies to address the desires of those segments rather than the mass market ex. Babies R Us appeals to young parents

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bifurcated retailing

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the decline of middle-of-the market retailing. firms that are neither competitively priced nor particularly individualistic may have difficulty competing.

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target market

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customer groups sought by a retailer

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mass marketing

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selling goods and services to broaden spectrum of consumers

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concentrated marketing

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zeroing in on a specific group

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competitive advantage

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the distinct competencies of a retailer relative to competitors

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controllable variables

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store location, merchandising and pricing, communicating with customers

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uncontrollable variables

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consumers, competition, technology, economic conditions, legal restrictions

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tactics

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short run decisions are now made and enacted for each controllable part of the strategy

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control

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in this phrase a review takes place, retail audit.

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feedback

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observant management receives signals or cues as to success or failure of that part of the strategy.

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retail institution

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basic format or structure of a business

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independent retailer

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owns one retail unit

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ease of entry

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high number of independents is associated with that due to low capital requirements and no or relatively simple, licensing provisions for many small retail firms

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chain retailer

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operates multiple outlets( store units) under common ownership; it usually engages in some level of centralized coordinated purchasing and decision making. corporate owns all stores ex. Steak and Shake

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franchising

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involves a contractual agreement between a franchise( manufacturer, wholesaler, service sponsor) and a retail franchisee, which allows the franchisee to conduct business under an established name and according to a given pattern of business. ex. McDonalds

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product/ trademark franchising

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a franchisee acquires the identity of a franchiser by agreeing to sell the latter's products and/or operate under the latter's name ex. auto/gasoline dealers

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business format franchising

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more interactive relationship, franchisee receives assistance on site location, quality control, accounting systems, start-up practices, management practices, and responding to problems besides the right to sell goods and services. ex. McDonalds Hamburger U training, service manager visits, detailed operation guide

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constrained decision making

answer

whereby franchisers limit franchisee involvement in the strategic planning process. ex. Federal Trade Commission

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leased departments

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department in retail store usually a department discount or specialty store- that is rented to an outside party. ex. Medlisco Corp runs leased shoe department in Rite Aids and Kmarts

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vertical marketing system

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consists of all levels of independently owned businesses along on a channel of distribution. are independent- stationary store, partially integrated- furniture store, fully integrated- Kroger

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dual marketing

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engage in more than one type of distribution arrangement ex. Dunkin Donuts and Baskin Robbins share stores, Sherwin Williams sells Dutch Boy point

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channel control

answer

one member of a distribution channel dominates the decisions made in that channel due to the power it possesses. ex.

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consumer cooperative

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retail firm owned by its customer members a group of consumers invests, elect officers, manages operators, and shares the profits or savings that accrue.

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strategy mix

answer

the firm's particular combination of store location, operating procedures, goods/services offered, price tactics, store atmosphere, and customer services, promotional methods.

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destination retailer status

answer

whereby consumers view the company as distinctive enough to become loyal to it and go out of their way to shop there.

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wheel of retailing

answer

retail innovators often first appear as low price operators with low costs and low profit margin requirements. then go to medium and then high

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scambled merchandising

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occurs when a retailer adds good and services that may be unrelated to each other and to the firm's orginial business. ex. blockbuster adding online

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retail life cycle

answer

states that retail institutions like the goods and services they sell- pass through identifible life stages: intro( growth), growth( accelrated development, maturity decline.

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mergers

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involve the combination of separately owned retail firms. ex. Office Depot and Staples

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diversification

answer

retailers become active in business outside their normal operations- add stores in different goods/service categories.

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downsizing

answer

whereby unprofitable stores are closed or divisions are sold off- by retailers unhappy with their performance. ex. Sears

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convenience store

answer

typically a well-located, food-oriented retailer that is open long hours and carries a moderate number of items ex. Circle K

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supermarket

answer

self-service food store with grocery, meat, and produce departments and minimum annual sales of 2 million.

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conventional supermarket

answer

departmentalized food store with a wide range of food and related products; sales of general merchandise are rather limited. ex. Kroger

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food-based superstore

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larger and more diversified than a conventional supermarket but usually smaller and less diversified than a combination store. ex. Giant Eagle has a pharmacy

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combination store

answer

unites supermarket and general merchandise in one facility, with general merchandise accounting 25-40% of sales. ex. Fred Meyer

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supercenter

answer

combo store blending on economy, supermarket with a discount department store. ex. Wal-mart, Target

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box( limited line) store

answer

food based discounter that focuses on a small selection of items, moderate hours of operation( compared with other supermarkets), few services, and limited manufactured brands. ex. Aldi's

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warehouse store

answer

food-based discounter offering a moderate number of food items in a no-fills setting. ex.men's warehouse

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specialty store

answer

concentrates on selling one goods or service line, such as young women apparel. ex. Harry and David

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category killer ( power retailer)

answer

especially large specialty store ex. Sephora, Home Depot

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department store

answer

large retail unit with extensive assortment( width and depth) of goods and services that is organized into separate departments for purposes of buying, promotion, customer service, and control

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traditional department store

answer

merchandise quality ranges from average to quite good ex. Macy's, Bloomingdales

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full line discount store

answer

has shopping carts, conveys image of high-volume low discount outlet selling broad product assortment. customer service is usually in a centralized area. less fashion-sensitive merchandise. operating costs are lower. ex. Target, Walmart

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variety store

answer

handles an assortment of inexpensive and popularly priced goods and services, such as apparel and accessories, costume jewelry, notions and small wares, candy, and other items in price range. ex. Dollar Tree- dollar discount store closeout chain- Big Lots

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off- price chain

answer

features brand name( sometimes designer) apparel and accessories, footwear, linens, fabrics, cosmetics, etc. sells them at every day low prices in an efficient, limited-service environment. ex. TJ Maxx, Marshalls

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factory outlet

answer

manufacturer-owned store selling closeouts; discontinued merchandise; irregulars; cancelled orders, and sometimes in season first quality merchandise. ex. Grove City outlets

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membership ( warehouse) clubs

answer

appeals to price- conscious customers, who must be members to shop there. ex. Sam's Club

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flea market

answer

many retail vendors sell a range of products at discount prices in plain surroundings.

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customer value

answer

perception the shopper has of a value chain

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value chain

answer

represents the total bundle of benefits offered to consumers through a channel of distribution

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core customers

answer

best customers

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expected customer service

answer

service level that customers want to receive from any retailer, such as basic employee courtesy.

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augmented customer service

answer

included the activities that enhance the shopping experience and give retailers a competitive advantage. ex. Autozone

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employee empowerment

answer

whereby workers have the discretion to do what they believe is necessary - within reason- to satisfy the customer, even if it means bending the rules. Ex. Nordstorm make suggestions, be different, but be smart.

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revolving credit account

answer

whereby a customer charges items and is billed monthly on the basis of outstanding cumulative balance.

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option credit card

answer

form of revolving account; no interest is assessed if a person pays a bill in full when it's due.

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open credit account

answer

a consumer must pay the bill in full when it's due. ex. Amex

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customer satisfaction

answer

occurs when the value and customer service provided through a retailing experience meet or exceed customer expectations

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value delivery system

answer

comprises all the parties that develop, produce deliver, and sell and service particular goods and services.

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good retailing

answer

focuses on the sale of tangible ( physical products)

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service retailing

answer

involves transactions in which consumers don't purchase or acquire ownership of tangible products. ex. travel agencies

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rented- goods service

answer

whereby consumers lease and use goods for specified periods of time ex. Hertz car rentals

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owned-goods service

answer

goods owned by consumers are repaired, improved, or maintained. ex. lawn care

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nongood services

answer

intangible personal services are offered to consumers who often experience the services rather than possess them. ex. stockbroker

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single- channel retailing

answer

whereby it sells to consumers though one retail format. ex. Web, catalog

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direct marketing

answer

customer is first exposed to a good or service though a nonpersonal medium( TV, Web) orders it by phone, mail, or computer

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data-base retailing

answer

way to collect, store, and use relevant information about customers. ex. Tommy

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specialog

answer

retailer caters to a particular customer segments, emphasizes a limited number of items, and reduces production and postage costs. Ex. LL Bean's Christmas catalog

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informerical

answer

program length TV commerical( 30 mins) for a specific good or service that airs on cable or broadcast TV, often at the fringe time.

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direct selling

answer

includes both personal contact with consumers at their homes or offices and phone solitications

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internet

answer

a global electronic super highway of computer networks that use common protocol and are linked by telecommunications lines and satellite.

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World Wide Web

answer

is one way to acccess information on the Internet, whereby people work with easy-to-use Web addresses ( sites) and pages

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video kiosk

answer

is a free standing, interactive, electronic computer terminal that displays products and related information on a video screen; it often has a touch screen for consumers to make selections. ex. Macy's

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demographics

answer

objective, quantifiable, easily identifiable, and measurable population data.

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lifestyles

answer

ways in which individual consumers and families live and spend time and money

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culture

answer

distinctive heritage shared by a group of people that passes on a series of beliefs, norms, and customs

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social class

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involves an informal ranking of people based on income, occupation, education, and other factors

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reference groups

answer

influence people's thoughts and behaviors; aspirational groups- a person does not belong but wishes to join; membership groups- a person does belong, etc.

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family life cycle

answer

describes how a traditional family moves from bachelorhood to children to solitary retirement.

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household life cycle

answer

incorporates lifestages for both family and nonfamily households

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personality

answer

a sum total of an individual's traits, which make that individual unique.

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class consiousness

answer

is the extent to which a person desires and pursues social status.

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attitudes( opinions)

answer

are the positive, neutral, or negative feelings a person has about different topics.

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perceived risk

answer

level of risk a consumer believes exists regarding the purchase of a specific good or service from a given retailer, whether or not that belief is correct

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motives

answer

reasons for customer behavior

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cross shopping

answer

whereby 1. shop for a product category at more than one retail format during the year. 2. visit multiple retailers on one shopping trip. ex. people shop online and also in department stores

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consumer behavior

answer

process by which people determine whether, what, when, where, how, from whom, and how often to purchase goods and services

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consumer decision process

answer

2 parts: the process itself and the factors affecting the process. stimulus-problem awareness-info search-eval of alternatives-purchase-post purchase.

question

stimulus

answer

cue or drive meant to motivate or arouse a person to act.

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problem awareness

answer

consumer not only been aroused, but also recognizes that the good the good or service may solve a problem

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information search

answer

1. determining alternatives that will solve the problem at hand. 2. ascertaining the characteristics of each alternative

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evaluation of alternatives

answer

if two or more options seem attractive, person determines the criteria to evaluate their importance

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purchase act

answer

exchange of money or a promise to pay for the ownership of a good or service.

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post purchase behavior

answer

further purchases or reevaluation

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cognitive dissonance

answer

doubt that the correct choice has been made

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extended decision making

answer

occurs when a consumer makes full use of the decision process

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limited decision making

answer

a consumer uses each step in purchase process but does not spend a great deal of time on each of them

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routine decision making

answer

takes place when consumer buys out of habit and skips steps in the purchase process.

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impulse purchases

answer

arise when consumer buys product and brands they had not planned on when entering store

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consumer loyalty

answer

a person regularly shops at a particular retailer that he or she knows, likes, or trusts

question

differentiated marketing

answer

aiming at 2 or more distinct consumer groups, with different retailing approaches for each group. ex. Budweiser has different campaigns for young and old

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competitive advantages

answer

the distinct competencies of retailer relative to competitors. ex. Tiffanys

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feedback

answer

when observant management receives signals or cues.

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consumer cooperative

answer

retail firm owned by its customer members. a group of consumers invests, elects officers, manages operations, and shares the profits or savings that accrue. ex. REI sells recreational equipment.

question

destination retailer

answer

whereby consumers view the company as distinctive enough to become loyal to it and go out of their way to shop there.

question

strategy mix

answer

the firm's particular combination of store location, operating procedures, goods/services offered, pricing tactics, and store atmosphere, promotions, customer service.

question

nonstore retailing

answer

when they use strategy mixes that are not store based to reach consumers and complete transactions. ex. video kiosks, airport retailing

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discretionary income

answer

money left over after paying taxes and buying neccessities

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personality

answer

is the sum total of an individual's traits, which make that individual unique.

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outshopping

answer

out of hometown shopping. important for both local and surrounding retailers. ex. Canadians coming to outlets

question

value

answer

from manufacturer, wholesaler, retailer: embodied by a series of activities and processes- a value chain- that provides a certain value for the consumer from customer: the perception the shopper has of a value chain.

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