Retail Marketing chapter 13

Black market

the availability of merchandise at a high price when it is difficult or impossible to purchase under normal market circumstances; commonly involves illegal transactions.

Buyback

a strategy vendors and retailers use to get products into retail stores, either when a retailer allows a vendor to create space for goods by “buying back” a competitor’s inventory and removing it from a retailer’s system or when the retailer forces a vendor to buy back slow-moving merchandise. Also called stocklift or lift-out.

Chargeback

a practice used by retailers in which they deduct money from the amount they owe a vendor.

Commercial bribery

a vendor’s offer of money or gifts to a retailer’s employee for the purpose of influencing purchasing decisions.

Cooperative (co-op) advertising

a program undertaken by a vendor in which the vendor agrees to pay all or part of a promotion for its products.

Copycat brand

a branding strategy that imitates the manufacturer brand in appearance and trade dress but generally is perceived as lower quality and is offered at a lower price.

Copyright

a regulation that protects original works of authors, painters, sculptors, musicians, and others who produce works of artistic or intellectual merit.

Corporate social responsibility (CSR)

voluntary actions taken by a company to address the ethical, social, and environmental impacts of its business operations and the concerns of its stakeholders.

Counterfeit merchandise

goods that are made and sold without permission of the owner of a trademark, a copyright, or a patented invention that is legally protected in the country where it is marketed.

Diverted merchandise

merchandise that is diverted from its legitimate channel of distribution; similar to gray-market goods except there need not be distribution across international boundaries.

Duty

a tax placed by a government upon imports. Also known as a tariff.

Exclusive brand

a brand developed by a national brand vendor, often in conjunction with a retailer, and sold exclusively by the retailer.

Exclusive dealing agreement

restriction a manufacturer or wholesaler places on a retailer to carry only its products and no competing vendors’ products.

Fair trade

purchasing practices that require producers to pay workers a living wage, well more than the prevailing minimum wage, and offer other benefits, like onsite medical treatment.

Family brand

a product’s brand name associated with the company’s name. Also called an umbrella brand.

Generic brand

unbranded, unadvertised merchandise found mainly in drug, grocery, and discount stores.

Gray-market goods

merchandise that possesses a valid U.S. registered trademark and is made by a foreign manufacturer but is imported into the United States without permission of the U.S. trademark owner. Also called parallel imports.

Green sheen

the disingenuous practice of marketing products or services as being environmentally friendly with the purpose of gaining public approval and sales rather than actually improving the environment. Also known as greenwashing.

Greenwashing

the disingenuous practice of marketing products or services as being environmentally friendly with the purpose of gaining public approval and sales rather than actually improving the environment. Also known as green sheen.

House brand

products developed and marketed by a retailer and available for sale only by that retailer. Also called store brand, private-label brand, or own brand.

Intellectual property

property that is intangible and created by intellectual (mental) effort as opposed to physical effort.

Lift-out

a strategy vendors and retailers use to get products into retail stores, either when a retailer allows a vendor to create space for goods by “buying back” a competitor’s inventory and removing it from a retailer’s system or when the retailer forces a vendor to buy back slow-moving merchandise. Also called a buyback or stocklift.

Manufacturer’s brand

a line of products designed, produced, and marketed by a vendor. Also called a national brand.

Markdown money

funds provided by a vendor to a retailer to cover decreased gross margin from markdowns and other merchandising issues.

Market weeks

often located in wholesale market centers, market weeks are a specific period of time in which buyers meet with vendors in their showrooms.

National brand

a line of products designed, produced, and marketed by a vendor. Also called A manufacturer’s brand.

Own brand

products developed and marketed by a retailer and available for sale only by that retailer. Also called store brand, private-label brand, or house brand.

Parallel imports

merchandise that possesses a valid U.S. registered trademark and is made by a foreign manufacturer but is imported into the United States without permission of the U.S. trademark owner. Also called gray-market goods.

Partnering relationship

long-term relationship in which partners make significant investments to improve both parties’ profitability. Also called strategic relationship.

Premium store brand

a branding strategy that offers the consumer a private label at a comparable manufacturer-brand quality, usually with a modest price savings.

Private-label brand

products developed and marketed by a retailer and only available for sale by that retailer. Also called store brand, house brand, or own brand.

Resident buying office

an organization located in a major buying center that provides services to help retailers buy merchandise.

Reverse auction

auction conducted by retailer buyers. Known as a reverse auction because there is one buyer and many potential sellers. In reverse auctions, retail buyers provide a specification for what they want to a group of potential vendors. The competing vendors then bid down the price at which they are willing to sell until the buyer accepts a bid.

Slotting allowance

fee paid by a vendor for space in a retail store. Also called slotting fee.

Slotting fee

fee paid by a vendor for space in a retail store. Also called slotting allowance.

Stocklift

a strategy vendors and retailers use to get products into retail stores, either when a retailer allows a vendor to create space for goods by “buying back” a competitor’s inventory and removing it from a retailer’s system or when the retailer forces a vendor to buy back slow-moving merchandise. Also called buyback or lift-out.

Store brand

products developed and marketed by a retailer and only available for sale by that retailer. Also called private-label brand, house brand, or own brand.

Strategic relationship

long-term relationship in which partners make significant investments to improve both parties’ profitability. Also called partnering relationship.

Sub-brand

part of a branding strategy in which a product’s brand name is associated with the description of the product, such as Frosted Flakes, where the family brand is Kellogg’s.

Tariff

a tax placed by a government on imports. Also known as a duty.

Trademark

any mark, work, picture, or design associated with a particular line of merchandise or product.

Trade show

a temporary concentration of vendors that provides retailers opportunities to place orders and view what is available in the marketplace.

Trust

a belief that a partner is honest (reliable,stands by its word, sincere, fulfills obligations) and benevolent (concerned about the other party’s welfare).

Tying contract

an agreement between a vendor and a retailer requiring the retailer to take a product it does not necessarily desire (the tied product) to ensure that it can buy a product it does desire (the tying product).

Umbrella brand

a product’s brand name associated with the company’s name. Also called an family brand.

Wholesale market

a concentration of vendors within a specific geographic location, perhaps even under one roof or over the Internet.