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What is the opportunity?
Social Responsibility
Social Responsibility
Environmental FactorsMacro-
Environment
CompetitorsCustomers
Micro-EnvironmentTechnology Social Issues
Ethical/LegalIssues Political Issues
Environmental Issues
RETAILERETAILERR
“By bringing sustainability into the conversation from the outset, the Accord is intended to spark thinking about new behaviors and new business models.”
A New Model for Green DesignJanuary 18, 2008
“While this more eco-driven approach is significant, it's the second part of the accord that promises to have the biggest impact—on the studios, their clients, and ultimately consumers. Signers of the accord promise to break the traditional secrecy of the industry by sharing what they've learned about sustainable design.”
“...if successful, the Designers Accord will catalyze the sustainable design movement in the U.S., which, while clearly gaining momentum, still lags behind that of Europe, where stricter government regulations have required companies to focus on environmental issues for some time.”
http://www.designersaccord.org/
ConsumerConsumerRetailerRetailerWholesalerWholesaler
The Distribution Channel
ManufacturManufacturerer
Types of Retailers(continued)
Critical DecisionsVariety
Assortment
Services
Pricing
Describing Different Types of Retailers
(Retail Mix)CustomerService
Retail Strategy
Store Design& Display
Location
CommunicationsMix
MerchandiseAssortments
Pricing
• Food Retailers•Primary Shopping Format for Food Sales
Growth Rates by Retail Format
• Fresh perishables
• Health-conscious& ethnic
• In-store experience
• Private brand labels
How supermarketsare competing
• Department Stores• Specialty Stores• Category Specialists• Home Improvement Centers
• Discount Stores• Drugstores• Off-Price retailers• Extreme Value Retailers
Types of General Merchandise Retailers
Royalty-Free/CORBIS
Department stores in an eroding market
•Attempting to increase the amount of exclusive merchandise they sell
•Undertaking marketing campaigns to develop strong images for their stores and brands
•Building better relationships with their key customers
Why Sears Must EngineerIts Own Makeover
Text
“With a potential recession on the horizon, retail experts say it is now clear Chairman Edward S. Lampert must engineer a radical makeover of the 121-year-old retailer to prove it can thrive alongside bigger rivals. To halt the sales and profit declines, the company's Sears and Kmart stores must forge new roles for themselves that will distinguish them in customers' eyes from competitors such as Kohl's Corp., J.C. Penney Co., Target Corp. and Wal-Mart Stores Inc.
January 16, 2008
Issues in Discount Store Retailing• Only Big Three Left Wal-Mart, Kmart, Target
• Wal-Mart’s Dominance
• Differentiate StrategyWal-Mart = Low Price and Good valueTarget = More Fashionable Apparel
• Competition from Category SpecialistsToys-R-Us, Circuit City, Sports Authority
McGraw-Hill Companies, Inc./Gary He, photographer
•Decline in Mall Shopping and Apparel Sales
•-Lack of New Fashions•-Less Interest in Fashion•-Increase Price
Consciousness•Lifestyle Formats –
Abercrombie and Fitch and Hot Topics
McGraw-Hill Companies, Inc./Gary He, photographer
Issues in Specialty Store Retailing
• Consolidation – Walgreens, CVS, Rite-Aid
• Competition from Supermarkets, discount Stores and mail-in orders
• Evolution to a New Format• Stand Alone Sites with Drive
Thru Windows• Offering more frequent
purchase food items• Improved systems provide
personalized service in the pharmacy
Issues in Drug Store Retailing
• Deep and Narrow Assortments Destination Stores
• Low Price and Service
• Wholesaling to Business Customers and Retailing to Consumers
• Incredible Growth
Ryan McVay/Getty Images
Category Specialists
10 Most Profitable Businesses
10 Least Profitable Businesses
10 Most Profitable Businesses
1. Accounting Services2. Legal Services3. Dental Services4. Specialized Design Services5. “Other” Health Practitioners6. Outpatient Care Centers7. Insurance Brokers8. Physicians' Offices9. Medical And Diagnostic Labs10. Depository Credit Intermediation
Services vs. Merchandise RetailersIntangibility -Problems in Evaluating Service Quality -Performance of Service Provider
Simultaneous Production and Delivery -Importance of Service Provider
Perishability -No Inventory, Must Fill Capacity
Inconsistency of the Offering -Importance of HR Management
• Independent• Corporate Retail chains• Franchise
Types of Ownership
Multi-channel Retailing
“Tri-Channel” Retailing
Digital Vision / Getty Images
Catalog
Steve Cole/Getty Images
Internet
The McGraw-Hill Companies, Inc./Andrew Resek, photographer
Physical Store
Store Channel• Browsing• Touching & Feeling Products• Personal Service• Cash Payment• Entertainment and Social Experience• Immediate Gratification• Risk Reduction
Catalog Channel
• Convenience• Safety• Quality of Visual Presentation
Internet Channel• Broader Selection• More Information to Evaluate
Merchandise• Personalization• Selling Merchandise with “Touch and
Feel” Attributes• Perceived Risks in Electronic
Shopping
Rainforest Cafe
Starbucks
Strengths?Issues?
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