Mar3231 exam 2

Types of Ownership

1.Independent retailers
2.Chain Retailer
3.Franchise
4.Leased Department

independent retailer
-advantage/disadvantages

advantages
-easy entry
-full control
-in charge of personal imagine
-consistency & independence
Disadvantages
-Lack of bargaining power
-Intense Labor hours(dependent on owner)

Chain Retailer
-advantage/disadvantages

advantages
-Bargaining power
-Efficient
- Defined management Philosophy
Disadvantages
-Limited flexibility
-Higher investment cost
-Limited independence
Def: Multiple Outlets under common ownership
-One group makes decisions for all of the retailers
examp

Franchises
-advantage/disadvantages

Def: A agreement between a franchise and a franchisee to open their restaurant.
advantages
- low capital required
-owner of a company that is well known
-corporate marketing
-exclusive rights
disadvantages
-franchises could open up close to you
- overstat

Leased Department
-advantage/disadvantages

def: A leased space in a department store
advantages
-provides one-stop shopping
-leasee handle management
-reduces store cost
-provides a stream of revenue
disadvantages
-leaser might ruin store image
-their procedures can cause conflict with department

Destination retailers

def: cost effiecent, amazing service, exclusive merchandise
examples: trader joes, Ikea, Bass pro, American Girl Doll

Retail Strategy Mix

def: the firms mix of
-store location
-operation procedures
-goods/services offered
-pricing tactics
-store atmosphere
-customer service
-promotional method
ex:bed bath and beyond 20% off coupon

Wheel of retailing

4 principles to explain the institutional changes that take place when new retailers enter the retail arena

Wheel of retailing
assumptions

1. there are many price sensitive shoppers, will trade location, service, and selection for price
2. Price sensitive shoppers are often not loyal to brand
3. New institutions have lower operating cost then existing ones.
4. retailers move up the wheel to

Wheel of retailing
lessons

1. do not lose sight of your prime customer's price
2. beware of the dangers in upgrading target market
3. employ customer benefit cost, analyze the benefits of specific service upgrades
4. use bundling prices to separately charge for select services such

Stages of the retail life cycle

1. Introduction
2. Growth
3. Maternity
4. decline

Stages of the retail life cycle
-Introduction

ex: real real
-low growing sales/profit
-limited competition

Stages of the retail life cycle
-Growth

-ex: nike factory store
-rapid acceleration of sales
-special need for certain people
-limited competition

Stages of the retail life cycle
-Maternity

-ex: home depot
-level out , or declining
-winner of category can be seen
-high sales, high/declining profit
-extensive competition

Stages of the retail life cycle
-Decline

ex: ...
-Low to break even profit
-sales dropping
-competition is intensive and consolidating

Lifestyle statistics

-ways in which consumers and families live and spend time/ money
*lifestyle brands-brands that attempt to embody a consumer segment lifestyle.
Ex: athletic person-LULEMON

Demographics

-consumer data That is objective, quantifiable, easily identifiable, and measurable.
ex: race, age, and gender

Types of reference groups

1. Aspiration-want to be in this group, but not in it
2.Membership-belong to this group
3. dissociative- do not like or want to be part of this group
4. face-to-face - family or peers are in this and expose you to these things.

Elements of perceived risk

1. Functional risk
2. physical risk
3. Financial risk
4. psychological risk
5.social risk
5. time risk

Elements of perceived risk
-Functional Risk

-product usable tests by retailer
ex: ikea showing how many people sat in the chair

Elements of perceived risk
-physcial Risk

-safety tests
ex: reduced salt

Elements of perceived risk
-financial risks

-money back guarantees

Elements of perceived risk
-social Risk

co-branding or private labels

Elements of perceived risk
-psycological Risk

-showing empathy for consumer

Elements of perceived risk
-time Risk

-double back money guarantee if not delivered in time

characteristics of service retailing

1. intangibles
2. inseparability
3. perishability
4. Variability

characteristics of service retailing
-intangibles

- no patent protection
- difficult to display / communicate service
-hard to convey quality
- quality judgment is subjective
-involves performance or expierence

characteristics of service retailing
-inseparability

- consumers must be present
ex:orange theory
-cant mass produce
- customer is loyal to employee not business

characteristics of service retailing
- perishability

-if their is an extra seat on a flight you lose money
-lost revenues from unsold services are lost forever
-effects of seasonality can be severe

characteristics of service retailing
-variability

-hard to standardize
- standardization and quality control hard to achieve
-need service blue prints to factor variability out
-customers can perceive this even if it doesn't actually happen.

Evaluation of service retailers

-search qualities are distinguished before purchase
ex:color, size, etc
-experience quality is analyzed after or during consumption
ex: taste, comfort
-credence qualities are impossible to evaluate even after consumption
ex: surgery, tax person

Gad model

1. listening gap
2. service stand gap
3. service performance gap
4. communication gap

7 Ps

1.price
2.product
3.promotion
4.place (distribution)
5. People
6.physical evidence
7. process