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Retailing is

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the process by which organizations sell goods and services to consumers for their personal use

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Four factors motivate innovative merchants to reinvent the way they do business:

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Changes in economic conditions Demographic and cultural change Technology Globalization

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Retailtainment is

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all about marketing strategies that enhance the shopping experience

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vulnerability phase

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high prices, luxurious facilities, excellent services and amenities

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entry phase

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low margin, low prices, limited or no services, low-end facilities

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trading-up phase

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moderate prices, better facilities, some services, increased quality merchandise

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its merchandise mix

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One of the most important strategic decisions a retailer makes is what to sell

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Merchandise breadth

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Narrow vs. broad assortment (consists of all the product lines that the company has to offer to its customers.) refer to slide 26

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Merchandise depth

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Shallow vs. deep assortment (refers to the number of subcategories a category has.) refer to slide 26

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product line

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is a group of related products under a single brand sold by the same company.

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A category killer

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is a specialty store that carries a large section of products within a given category (ex. best buy, lowe's, toys-r-us)

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Department stores sell

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a broad range of items and offer a deep selection organized into different sections

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Retailers may be categorized based on a variety of factors, including:

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Merchandise mix - both breadth and depth of assortment Service levels offered to customers Store size

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Nonstore retailing is

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any method a firm uses to complete an exchange that does not require a customer to visit a store (ex. direct selling, automatic vending, B2C E-commerce)

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Direct selling occurs when

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a salesperson presents a product to one individual or a small group, takes orders, and delivers the merchandise (Door-to-door sales, Party and networks, Multilevel marketing)

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Automatic vending

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Usually best suited to low-cost convenience goods Offers many benefits to consumers and marketers

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B2C e-commerce is

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online exchange between companies and individual consumers

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Services are

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acts, efforts, or performances exchanged from producer to user without ownership rights. (Service industry account for four out of every five jobs in the U.S. and nearly 80% of GDP)

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Four "I"s of Services

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Intangibility Inconsistency (Variability) Inseparability Inventory (Perishability)

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A service encounter occurs

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when the customer comes into contact with the organization

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Servicescapes are

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the actual physical facility where the service is performed, delivered, and consumed

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The SERVQUAL scale is

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a popular instrument to measure customer service quality.

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SERVQUAL identifies consumer perceptions of service quality on five components:

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Tangibles Reliability Responsiveness Empathy Assurance

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Integrated marketing communication (IMC) involves

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the planning, execution, and evaluation of coordinated, brand communication programs over time to targeted audiences

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Encoding is

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the process by which the idea is translated into a physically perceivable form that conveys meaning (ex. words, music, spokesperson)

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The message is

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the actual content of communication that goes from the source to a receiver

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messages are in the form of

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Advertising Sales promotion A salesperson's pitch Infomercial Word of mouth

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The medium is

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the communication vehicle that reach members of the target audience

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Marketers face two major challenges :

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Target market exposure to medium Does product conflict with medium

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The communication model also acknowledges that noise—anything that interferes with effective communication

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can block messages

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To complete the communication loop, the source

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gets feedback from receivers.

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Promotion mix refers to

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communication elements that the marketer controls.

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Mass (One-to-Many) Communication:

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Includes advertising, sales promotion, and public relations

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Personal (One-to-One) Communication:

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Includes personal selling and direct marketing

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marketing communications do what

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inform, remind, persuade and build relationships with consumers

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Steps to Develop the Promotional Plan Step 2: Establish the Communication Objectives

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Creating a new customer occurs as a result of a series of messages. Messages are designed to move the consumer closer to purchase, and hopefully, loyalty. The process of moving the consumer forward in this fashion is known at the hierarchy of effects.

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Steps to Develop the Promotional Plan Step 3: Determine and allocate the marketing communication budget

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Decision 1: Determine the total marketing communication budget Decision 2: Decide on a push or pull strategy Decision 3: Allocate spending to specific promotion activities

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Steps to Develop the Promotional Plan Step 4: Design the Promotion Mix

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Designing promotional mix involves: Determining promotional tools to be used Specifying message to be communicated Communication Goals Attention, interest, desire, and action (AIDA model)

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Steps to Develop the Promotional Plan Step 5: Evaluate the Effectiveness of the Communication Program

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Marketers use a variety of ways to monitor and evaluate the company's communication efforts. Sales promotion are the easiest to evaluate as they often occur over a fixed, short period Advertising has delayed effects, more difficult to clearly link to sales Brand awareness, recall of product benefits, image are typical ad campaign measures

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Multichannel promotion offers several benefits

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Boosts effectiveness of either online or offline strategies used alone Allows marketers to repeat messages across channels, strengthening awareness and providing more customer conversion opportunities

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Advertising is

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nonpersonal communication from an identified sponsor using mass media

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User-generated content (UGC)

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includes the millions of product-related comments, reviews, photos, images, and videos posted online by consumers (ex. doritos contest)

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Execution format

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describes the basic structure of the message

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Common formats include

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Comparison Demonstration Storytelling Testimonial Slice of Life Lifestyle

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Tonality

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refers to the mood or attitude the message conveys

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Owned media may include

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websites, blogs, Facebook, and Twitter accounts. (Controlled by company, effective for relationship building)

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Paid media includes

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display ads, sponsorships, and paid key word searches (Most similar to traditional advertising, less trusted by consumers)

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Earned media refers

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to word of mouth or buzz on social media. (Most credible to consumers, no company control)

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Mobile advertising

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is advertising that is communicated to consumers via a handset (gps new ad)

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Branded entertainment refers to

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paid placement of brands within movies, TV shows, video games, and even retail settings

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Support media include

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directory advertising, outdoor advertising, and transit advertising

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Three main types of advertising are

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product, institutional, and local/retail

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Sales promotions are

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programs designed to build interest in or encourage purchase of a good or service during a specified period

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How does sales promotion compare to advertising?

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Both are paid promotional activities with identifiable sponsors Differ in that sales promotions typically have a more immediate short-term objective

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groundswell

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Changing communication landscape

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Viral marketing refers

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to activities aimed at increasing brand awareness or sales via many-to-many communication (Apple implements viral marketing when it inserts the message "Sent from my iPad/iPhone" in a text)

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brand ambassadors or brand evangelists

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Recruit loyal customers

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Social networks

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like Facebook and Twitter, are sites that connect people with other people

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Virtual worlds

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highly engaging digital environments where avatars "live" and interact in real time

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Product review sites:

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Social media sites that enable people to post stories about their experiences with goods and services

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Mobile apps are

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software programs designed for smartphones and other devices that entertain, educate, and inform users.

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Location-based social networks integrate

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sophisticated GPS technology embedded in smartphones with a social networking platform

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Catalog

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a collection of products offered in book form, usually consisting of product descriptions and accompanied by photos of the item

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Direct mail

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A brochure/pamphlet offering a specific good or service at one point in time

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Telemarketing

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Direct marketing conducted by telephone

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Direct-response advertising

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allows consumer to respond by immediately contacting the provider with questions or an order

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Direct-response TV (DRTV) includes

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short commercials of less than 2 minutes

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Infomercials are

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typically half-hour or hour-long commercials resemble a talk show, often with heavy product demonstration elements

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M-commerce refers to

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promotional and other e-commerce activities transmitted over mobile phones and other mobile devices

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short-messaging system (SMS) marketing

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M-commerce through text messages

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direct marketing includes

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Mail order Telemarketing Direct response advertising M-commerce

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Personal selling occurs when

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a company rep interacts directly with a prospective customer to communicate about a good or service.

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Transactional selling:

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approach that focuses on making an immediate sale with little concern for developing a long-term relationship with the customer.

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Relationship selling

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process by which a salesperson secures, develops, and maintains long-term, profitable customer relationships

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Prospecting is

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the process by which salespeople identify and develop prospect lists. (Sources include: Directories and commercial databases, Web search engines, customer referrals, trade shows, and cold calling)

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Once prospects are identified, salesperson must then

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qualify leads

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In the preapproach stage

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salespeople try to learn as much as possible about prospects

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Several key events occur within first minutes of approach

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Salesperson tries to learn more about customer Create a positive first impression Build rapport

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Once preapproach is done, time to approach, or

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contact, the prospect

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Objections are

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reasons why a prospect is reluctant to make a commitment

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closing the sale is

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a natural conclusion to the dialogue

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Common closing techniques include:

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Last objection close Assumptive or minor points close Buy-now close

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Follow-up after the sale includes

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arranging for delivery, payment, and purchase terms

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Public relations (PR) is

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the communication function that seeks to build good relationships with an organization's publics

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publicity

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which is unpaid media exposure about a company

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Crisis management

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process of managing firm reputation in face of a negative event

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PR is counted on to achieve objectives like:

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Introduce products to retailers and consumers Influence government legislation Enhance organizational image Manage a crisis Call attention to a firm's community involvement

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Guerrilla marketing involves

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"ambushing" consumers with promotional content in places they don't expect to encounter such messages (flash mobs)

marketing chapters 12-14 – Flashcards

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