MKT 320 - Exam 4

What is retailing?

The set of business activities that add value to products/services sold to consumers.

What set of business activities add value to products and services sold to consumers?

retailing

What does retailing do for product/services sold to consumers?

Adds value

______ used to control the supply chain. Retailing falls at the _______ of the supply chain. Today, _____ dominate the supply chain.

Large manufacturers, end, large retailers

Large manufacturers used to control the supply chain. Retailing falls at the end of the supply chain. Today, large retailers dominate the supply chain.

True

Who are the top 10 US retailers of 2023 retail sales?

Walmart, Amazon, Costco, Kroger, Home Depot, CVS, Target, Walgreens, Lowes and Albertsons.

What was the top retailer in 2023?

Walmart

How much did Walmart sale in 2023?

544.96 billion

How much did Walmart grow versus prior year?

6.9%

Where is Walmart headquartered and how does that affect vendors?

Walmart is located in Arkansas, so vendors also station or headquarter there to make it easier to supply to them.

What are the factors for establishing a relationship with retailers?

1. Choosing retailing partners, 2. identifying types of retailers, 3. developing a retail strategy, and 4. managing an omnichannel strategy

What are the 4 things to consider in factor 1, choosing retailing partners, in establishing a relationship with retailers?

Channel structure, customer expectations, channel member characteristics, and distribution intensity

What is channel structure?

The level of difficulty a manufacturer experiences in getting retailers to purchase its products is determined by the degree to which the channel is vertically integrated, has a strong brand, and has relative power of the manufacturer and retailer.

What is an example of vertical integration in channel structure?

New MAC mascara immediately appearing in its MAC retail stores with no decision on the part of the retailer.

What is an example of strong brand in channel structure?

If Coach entered a new market, like Men’s leather goods, they would use their brand name and existing relationship with women handbag buyers to position its new products.

What is an example of relative power in channel structure?

Coach has access to steal at most stores because of its power in retailing.

Channel structure = The degree of ______ integration, strength of manufacturers’ _______, and relative power of _______.

vertical, brands, manufacturer and retailer.

What are the preferred makeup channels by age group?

18-29 prefer department stores, 30-59 prefer department stores, and 60 and older prefer drug stores.

Larger firms gain more control and can save more money.

True

What are different types of distribution intensity?

Intensive, selective, and exclusive.

What is intensive distribution?

Products in as many places as possible (Pepsi being sold in Walmart and Target)

What is selective distribution?

Relies on a few selected retail customers in a territory. (Pharmaceuticals)

What is exclusive distribution?

Grants exclusive geographic territories (Coach).

What is the world’s larger grocer?

Walmart, who buys directly from the manufacturer.

What is the number 1 item sold at Walmart in the US?

Bananas

What are the 3 main types of retailers?

Food, general merchandise, and service

What retailers belong to the food type of retailers?

Supermarkets, supercenters, warehouse clubs, and convenience stores

What retailers belong to the general merchandise retailers?

Full-line discount, specialty, category specialists, drug, department, off-price, and extreme value

What retailers belong to service retailers?

Auto rental, health spa, vision center, bank

What are supermarkets in food retailers?

They have limited nonfood items (they are mostly food), and they are differentiated by the number of SKUs in the store. These include stores like Harris Teeter.

What are supercenters in food retailers?

Supermarket combined with a full-line discount store, such as Walmart.

What are Warehouse clubs in food retailers?

Limited assortments, little service, and low prices, such as Costco, Sam’s, BJs.

What are convenience stores in retailers?

Limited variety, speedy checkout, stores like Sheetz.

What are current new trends in food?

Online grocery delivery like Instacart, food delivery services like HelloFresh.

Online capabilities continues to ______. Companies seek to add ____ to the grocery channel by providing _____.

expand, value, delivery.

Online capabilities continues to expand. Companies seek to add value to the grocery channel by providing delivery.

True

What are department stores in general merchandise retailers?

Large variety and assortment such as Belk or Macys.

What are full-line discount stores in general merchandise retailers?

Large variety, low prices, and little service such as Walmart and Target.

What are Specialty stores in general merchandise retailers?

Limited merchandise with service such as a bookstore.

What are drugstores in general merchandise retailers?

Pharmaceuticals and health such as CVS.

What is a category specialist in general merchandise retailers?

Narrow but deep assortment of merchandise (Best Buy, Toys R Us)

What are extreme-value retailers in general merchandise retailers?

Offer limited merchandise at very low prices such as Ollies, or Aldi.

What are off-price retailers in general merchandise retailers?

Inconsistent assortment of brand-name goods at discounted prices such as TJMaxx, Ross, HomeGoods.

What are Service retailers in general merchandise retailers?

House cleaning, personal trainer, or nail salon.

What are the seven Ps?

Product, Price, Place, Promotion, Presentation, Personnel, and Processes.

Retailers can modify the seven Ps to increase their share of wallet.

True

What is Product in the 7 P’s?

Providing the right mix of merchandise and services that satisfies the target market.

Private label brands or store brands help retailers:

distinguish themselves from the competition.

What is Price in the 7 Ps?

defines the value of both the merchandise and the service provided.

What is promotion in the 7 Ps?

Retailers use a wide variety of promotions, both within their retail environment and through mass and social media. (Black Friday, Cyber Monday, buy 2 get 3 free)

What is place in the 7 Ps?

Convenient location is a key ingredient to success. Many customers choose store based on their location. Great locations can create a competitive advantage.

What is Presentation in the 7 Ps?

Lighting, color and music are used to highlight merchandise and create a mood known as atmosphere.

What is Personnel in the 7 Ps?

Well-trained sales personnel can influence the sale by educating customers and encouraging purchase.

What is processes in the 7 Ps?

Actions taken to get a good or service to a customer. Can influence the value perceived by customers with sustainable manufacturing and fast checkout times. (Trader Joe’s new and attractive problems to retain customers)

What are the benefits of omnichannel retailing?

Deeper and broader selection, personalization, expanded market presence, integrated CRM, brand image, pricing, and supply chain

What is omnichannel?

Also known as multichannel, it is a strategy which involves selling in more than one channel (store, catalog, internet).

In the past, ________ controlled supply chains, while today ________ control supply chains.

manufacturers; retailers

When choosing a retail partner, manufacturers consider

all of these answers are correct.

If a manufacturer wants to sell a full range of products in a number of different container sizes, which kind of store would the company be least likely to choose as a retailing partner?

 

convenience stores

If you walk into a(n) ________, you will likely find a broad variety of merchandise, deep assortment, and customer service, with everything organized into distinct departments for displaying merchandise.

department store

________ are combating competitive pressures by providing better value with private-label merchandise; adding value-added services such as online ordering and delivery options; and providing a better shopping experience.

Conventional supermarkets

If you are a marketer for a manufacturer, and the marketing mix for your product focuses on very specific market segments, you would most likely sell your product through

specialty stores.

Because of the way ________ buy merchandise, customers can never be confident that the same merchandise will be in stock each time they visit the store or website.

off-price retailers

It is often difficult for retailers to distinguish themselves from their competitors through the merchandise they carry because

competitors can purchase and sell many of the same popular brands.

________ must always be aligned with other elements of a retailer’s strategy in order to accurately define the value of the product and a retailer’s image.

Price

One of the greatest constraints faced by store-based retailers—and one that the Internet channel can address—is

the amount of merchandise that can be carried in a physical store.

______ tailor their retail strategies toward very specific market segments by offering deep, yet narrow assortments and soles associate expertise.

Specialty stores

Retailers modify product, price, and/or promotion to attempt to increase their ______, which is the percentage of a customer’s purchases made from that particular retailer.

share of wallet

What is IMC?

Integrated marketing communications

What is integrated marketing communications?

Encompasses a variety of communication disciplines in combination to provide clarity, consistency, and maximum communicative impact.

What were the seasonal treats discussed?

Pumpkin spice cheesecake cookies, PSL popcorn, Turkey shaped butter

What was discussed about coke?

Is the global brand leader for soft drinks, comes in varying different sizes. Mexican coke has cane sugar, US has corn syrup.

When did the coke bears come out? and when did the commercials start?

1922, 1993.

How many different versions of coke bears are there?

27

What does ICM include?

Customers, communication channels, and results of communications.

What is the communication process?

Includes sender, transmitter, encoding, communication channel, receiver, noise, and then a feedback loop.

What is sender in the communication process?

The firm (such as pepsi)

What is the transmitter in the communication process?

The creative department the sender works with to develop marketing communications.

What is encoding in the communication process?

The conversion of the senders ideas into a message by the transmitter

What is a communication channel in the communication process?

Media

What is the receiver in the communication process?

The consumer, who decodes the message from the communication channel

What is noise in the communications process?

Any interference that steams from competing messages, lack of clarify of message, or a flax in the medium.

What is a feedback loop in the communication process?

This allows the receiver to communicate with the sender to inform them whether the message was received and decoded properly.

How do consumers perceive information?

Receivers decode messages differently. Senders (firms) work with transmitters (marketers) to encode messages through selected communication channels (media).

What is the AIDA Model?

Awareness, interests, desire, and action, the mental stages of consumers.

What is Awareness in AIDA?

Considered “Think”. Senders first must gain the attention of the consumer. Such as brand awareness, aided recall, or top-of-mind.

What is brand awareness?

The ability of potential customers to recognize the brand name associated with a product or service.

What is aided recall?

When consumers indicate they know the brand when the name is presented to them.

What is top-of-mind awareness?

The highest level of awareness, occurs when consumers mention a specific brand name first when they are asked about a product or service.

What is Interest in AIDA?

Considered “Feel”. The customer must want to further investigate the product/service. Can also be sparked by a little controversy.

What is desire in AIDA?

Considered “Feel”. I like it, I want it, I need it.

What is action in AIDA?

Considered “Do”. Ultimate goal is to drive the receiver to action.

What is the lagged effect?

Marketing communications do not always have an immediate impact. Multiple exposures are often necessary. Hard to determine which exposure led to purchase.

What are the channels used in IMC strategy?

For any communications campaign to succeed, it must deliver the right message to the right audience through the right media. The ultimate goal is to profit from long-term customer relationships.

What are interactive and offline channels?

Personal selling, sales promotion (contest), and direct marketing (telemarketing)

What are passive and offline channels?

Advertising, sales promotions (coupons), public relations, and direct marketing (catalogs)

What are interactive and online channels?

Direct marketing (mobile marketing), online marketing (blogs, social media).

What are passive and online channels?

Direct marketing (email marketing).

What is advertising?

The most visible element of an IMC strategy. Placement of announcements and persuasive messages.

What is Public Relations?

“Free” media attention. PR has grown as a cost of other media has increased. Build and maintain a positivity image. Handle unfavorable stories.