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RETAILING1717CHAPTER

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• Identify retailers in terms of the utilities they provide.

• Explain the alternative ways to classify retail outlets.

• Understand the many methods of non-store retailing.

AFTER READING THIS CHAPTERYOU SHOULD BE ABLE TO:

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• Classify retailers in terms of the retail positioning matrix.

• Develop retailing mix strategies over the life cycle of a retail store.

AFTER READING THIS CHAPTERYOU SHOULD BE ABLE TO:

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SMART, CHIC, AND CHEAP: TARGET HITS THE BULL’S-EYE!

RETAILING

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• Consumer Utilities Offered by Retailing

• The Global Economic Impact of Retailing

THE VALUE OF RETAILING

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Concept Check

1. When Levi Straus makes jeans cut to a customer’s exact preferences and measurements, what utility is provided?

A: Form Utility

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2. Two measures of the importance or retailing in the global economy are _________ and

___________________.

total sales

Concept Check

number of employees

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• Form of Ownership• Independent Retailer

• Corporate Chain

• Contractual System

CLASSIFYING RETAIL OUTLETS

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• Level of Service• Self-Service

• Limited Service

• Full-Service

CLASSIFYING RETAIL OUTLETS

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• Merchandise Line• Depth of Line

• Breadth of Line

CLASSIFYING RETAIL OUTLETS

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• Breadth of Line (cont) Scrambled merchandising Hypermarket Intertype competition

CLASSIFYING RETAIL OUTLETS

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1. Centralized decision making and purchasing are an advantage of ______ ownership.chain

Concept Check

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Concept Check

2. What are some examples of new forms of self-service retailers?

A: Federal Express’s self-service package shipping stations, and the self-service scanning system being installed at K-Mart.

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Concept Check

3. Would a shop for big men’s clothes carrying pants in sizes 40 to 60 have a broad or deep product line?

A: Deep

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• Automatic Vending

• Direct Mail and Catalogs

• Television Home Shopping

• Online Retailing

• Telemarketing

• Direct Selling

NONSTORE RETAILING

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1. Successful catalog retailers often send ________ catalogs to _____ markets identified in their databases.

specialty

Concept Check

niche

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Concept Check

2. How are retailers increasing consumer interest and involvement in online retailing?

A: Tactics such as virtual models encourage consumer interaction and increase involvement.

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Concept Check

3. Where are direct selling retail sales growing? Why?

A: Direct selling is likely to grow in market where the lack of effective distribution channels and lack of consumer knowledge about products increase the need for a person-to-person approach.

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• Positioning a Retail Store• Retail Positioning Matrix

RETAILING STRATEGY

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• Positioning a Retail Store (cont)• Keys to Positioning

• Retailing Mix

RETAILING STRATEGY

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• Retailing Mix (cont)• Retail Pricing

Shrinkage Off-price retailing

RETAILING STRATEGY

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• Retailing Mix (cont)• Store Location

Central business district Regional shopping centers Community shopping center Strip location Power center

• Retail Image and Atmosphere

RETAILING STRATEGY

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Concept Check

1. What are the two dimensions of the retail positioning matrix?

A: Breadth of product line and value added.

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Concept Check

2. How does original markup differ from maintained markup?

A: Original markup is the initial selling price less retailer cost. Maintained markup is the final selling price less retailer cost.

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3. A huge shopping strip with multiple anchor stores is a ______ center.power

Concept Check

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• The Wheel of Retailing

THE CHANGING NATURE OF RETAILING

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• The Retail Life Cycle

THE CHANGING NATURE OF RETAILING

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• Multichannel Retailing Multichannel retailers

• The Impact of Technology

• Changing Shopping Behavior

FUTURE CHANGES IN RETAILING

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Concept Check

1. According to the wheel of retailing, when a new retail form appears, how would you characterize its image?

A: A low-status, low-margin, low-price outlet.

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2. Market share is usually fought out before the ________ stage of the retail life cycle.

maturity

Concept Check

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Concept Check

3. What is a smart card?

A: A smart card looks like a credit card but store information about bank accounts and customer purchases on computer chips.