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RETAIL MARKETING
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Instructor :
Dr. Mayo De Juan Vigaray
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Power points: conceptual framework
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PART 1
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RETAIL MARKETING
2. COURSE DESCRIPTION AND OBJECTIVES
merchandising philosophyretail store image atmospherics and visual merchandisingFirst part atmospherics and visual merchandisingcustomer service“retail-tainment” and Lifestyle merchandising
promotional process
p
promotional process promotional methods promotion objectivessales promotion tools
Second part
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MERCHANDISING OBJECTIVES
To examine the concept of retail image
To describe how a retail store image i d t
VISUAL MERCHANDISING
is conveyed to consumers
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ATMOSPHERICS
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De
Juan
Vig To show the importance of communicating with customers & customer service
© Mayo De Juan Vigaray 2007
Ma
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MERCHANDISING CONTENTS
M.1. Communication methods
M.2. Retail image
M.3. Design of a store
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M.4. Physical environment
Exterior
Atmospherics
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De
Juan
Vig M.5. Customer service General interior
Store layoutInterior displays
© Mayo De Juan Vigaray 2007
Ma p y
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MERCHANDISINGCommunication
methodsM.1.
MERCHANDISING
COMMUNICATION METHODSM.1.
Retail imageM.2.
Design of a storeM.3.
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Physical environmentM.4.
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Vig Customer serviceM.5.
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MERCHANDISINGCommunication
methodsM.1.
A REVIEW
A t il d i ti t t
A REVIEW
well-devised well-executed
A retailer needs a communications strategy
To properly position itselfin customer’s minds
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Communication methods
M.1.
A REVIEW
MERCHANDISING
A REVIEW
O t tt t d Once customers are attracted: it is imperative . . .
To create a
“PROPERLY MOOD
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MOOD
for them”
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Juan
Vig f m
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For shoppers to achieve the “nirvana” of pp“fulfilling their dreams” ……
t il t i i th t b …… retailers must inspire them to be positive, “smart” shoopers
It is the “smart”, inspired, positive shoppers who stay longer and purchase more …..
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y ….. due to the psychology
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Vig of the perception of time
© Mayo De Juan Vigaray 2007
Ma
Kaltcheva, V. and Weitz, B. (2006) “When Should a Retailer Create an Exciting Store Environment?” Journal of Marketing, Vol. 70, January, pp. 107-118.
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If in negative mode, they will leave early, will grab and go, or even worse !!!
they simply get out quickly,
might abort the purchase and
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might abort the purchase and,
maybe, never shop there again!!!
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And… even do not recommend it to anybody!!!!
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MERCHANDISINGCommunication
methodsM.1.
A REVIEWA REVIEW
The information must be interpreted by the target marketby the target market
In the manner inteded by the
retailer
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Communication methods
MERCHANDISING
COMMUNICATION METHODM.1.
COMMUNICATION METHOD
IMPERSONAL PERSONALID Personal selling
AdvertisingStore atmosphere
Visual merchandising
PA
I Visual merchandising Sales promotion
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PA
ID Word-of-mouthPublicity
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P
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AdvertisingStore atmosphere
Visual merchandising VMgSales promotion
P id l i ti Paid nonpersonal communication transmitted through out-of store mass media by an identified sponsor
Advertising
Short-term incentives to increase the
Salespromotions
Short term incentives to increase the effectiveness of the promotional efforts
gara
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VM & Store atmosphere
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Vig is shown to its best advantage and
in the most appropriate setting to influence customers to buy
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FOCUS MORE ON:Communication
methodsM.1.
MERCHANDISING
Store- based retailers Non-Store-based retailers(*)
FOCUS MORE ON:
Overall principles
Mail-order retailer:storefront = covers of catalog
Vsprinciples
aply layouts&displays= interior pages
Even in a product category like apparel, where catalog and internet outlets have
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internet outlets have made some of their greatest inroads, consumers still make….
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…. 90% of their purchases at brick-and-mortar stores
© Mayo De Juan Vigaray 2007
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(*) Sautter, P., Hyman, M. and Lukosius (2004) “E-tail Atmospherics: A Critique of the Literature and Model Extension”, Journal of Electronic Commerce Research, Vol. 5 N. 1.
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MERCHANDISING
Retail imageM.2.
MERCHANDISING
M.1. Communication methods
RETAIL IMAGEM.2.
Design of a storeM.3.
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Physical environmentM.4.
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MERCHANDISING
Retail imageM.2.
Image how a retailer is perceived by perceived by consumers and others.
___________
___________
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MERCHANDISINGRetail imageM.2.
Positioningfirm’s devising its strategyg gy
In a way that projects an image relative to its retail category and its competitorsits retail category and its competitors
That elicits consumer responses to this imageimage
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MERCHANDISING
Retail imageM.2.
Image and…?…
Space productivity represents h ff i l h il ili how effectively the retailer utilizes its space
and is usually measured by:
• sales per square “metres” or “cm”
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p qor “foot” of selling space
• gross margin ($ €) per square “metres” “cm” “foot” of selling
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Vig metres cm foot of selling
space.
1 foot=30 48 cm
© Mayo De Juan Vigaray 2007
Ma 1 foot=30,48 cm
1 mile=1.609 metres
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Typical Grocery Gondola Size Has Remained Stagnantyp y g
Confectionery In-Aisle GondolaGrocery Space
1993 20061993 2006
Length (Feet) 21.7 22.2
# Shelves 7.4 7.9
Shelf Space(Li F )
160.0 176.6
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(Linear Feet)
• The length (running footage) is almost exactly
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De
Juan
Vig The length (running footage) is almost exactly the same as it was 13 years ago
• Retailers have added shelves & increased pegs
© Mayo De Juan Vigaray 2007
Ma
to accommodate more productSource: Store Audits
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MERCHANDISING
Retail imageM.2.
O GELEMENTS OF RETAIL IMAGE
Attributes ofPhysical Facilities______
Market
C t
Firm’s_______
ShoppingExperiences
Customer_______
__________Service
OverallRetail
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Store_______
ServiceImage
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Vig _________
Attributes
© Mayo De Juan Vigaray 2007
Ma _________
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MERCHANDISINGDesign of a storeM.3.
MERCHANDISING
M.1. Communication methods
Retail imageM.2.
M.3. DESIGN OF A STORE
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Physical environmentM.4.
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© Mayo De Juan Vigaray 2007
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MERCHANDISING
Design of a storeM.3.
lighting, visual fixtures, communications
ceiling, walls and floor
RETAILERS THINK OF A STORE AS ......
Like the theater, the store design and all its
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, gcomponents should work in harmony to
support the merchandise rather than ti ith it
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Vig competing with it
staff Consumers
© Mayo De Juan Vigaray 2007
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merchandisingConsumers
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MERCHANDISING
Design of a storeM.3.OBJECTIVES WHEN DESIGNING OR REDESIGNING A STOREOR REDESIGNING A STORE
Managers must bear in mind the costs associated with the design and the reocurring costs
Retailers need to consider th t i t d ith
costs
the costs associated with each store design
Versus
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Versus
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Vig the value received in terms of
higher sales and profits
© Mayo De Juan Vigaray 2007
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Visual Merchandising DefinedVisual
M h di i & Merchandising & Atmospherics
DefinedEverything the customer sees,
both exterior and interior,
Defined
both exterior and interior, that creates a positive image of a
business and results in
Visual Merchandisingand results in
attention, interest, desire, and action 1. Supports sales- “the silent
salesperson”
g
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salesperson
2. Supports retail strategies
3 C i t ith t
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Vig 3. Communicates with customers
4. Communicates image
© Mayo De Juan Vigaray 2007
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5. Supports retailing trends
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Visual Merchandisers
Visual merchandisers are responsible forpthe total merchandise or servicepresentation, the overall business image,presentation, the overall business image,and even the building and placement ofdesign elements
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design elements
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MERCHANDISINGPhysical environmentM.4.
MERCHANDISING
M.1. Communication methods
Retail imageM.2.
Design of a storeM.3.
gara
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M.4. PHYSICAL ENVIRONMENT
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Vig Customer serviceM.5.
© Mayo De Juan Vigaray 2007
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MERCHANDISINGPhysical environmentM.4.
THE PHYSICAL ENVIRONMENT COMMUNICATES
Managing Attention is KeyRetailers’ Goal:• Get Initial Attention• Direct Attention• Sustain Attention• Sustain Attention
St Pl i
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Store PlanningCreating the Physical Environment• Exterior Building Design
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Vig • Exterior Building Design
• Interior Design• Allocation of Space
© Mayo De Juan Vigaray 2007
Ma Allocation of Space
• Arrangement and Location
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MERCHANDISINGPhysical environmentM.4.
MERCHANDISINGAtmospherics
M.1. Communication methods
Retail imageM.2.
Design of a storeM.3.
gara
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M.4.
ExteriorG l i i
ATMOSPHERICSPhysical environment
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Vig Customer serviceM.5. General interior
Store layoutInterior displays
© Mayo De Juan Vigaray 2007
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(*) Donovan, R.J., Rossiter, J.R. (1982) “Store Atmosphere: An Environmental Psychology Approach” Journal of Retailing, Spring, Vol. 58, n. 1, pp. 34-58.
(*)Park, C. Iyer, E. y Smith, D. (1989) “The Effects of Situational Factors on In-Store Grocery Shopping Behavior: The Role of Store Environment and Time Available for Shopping” Journal Shopping Behavior: The Role of Store Environment and Time Available for Shopping , Journal of Consumer Research, march, Vol. 15., pp. 422-433.
(*) Spies, K., Hese, F. y Loesch, K. (1997) “Store Atmosphere, Mood and Purchasing Behavior” J l f R h i M k i V l 14 1 17
(*) D’Astour, A. (2000) “Irritation Aspects of the Shopping Environment” Journal of Business Research, Vol. 49, n. 2., pp. 1º49-156.
Journal of Research in Marketing, Vol. 14, pp. 1-17.
gara
y
, , , pp
(*) Sharma, A. y Staffor, T. (2000) “The Effect of Retail Atmospherics on Customer’ Perceptions of Salespeople and Customer Persuasion: An Empricial Investigation”, Journal of Business Research Vol 49 n 2 pp 183 191
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De
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Vig Research, Vol. 49, n. 2., pp. 183-191.
(*) Turley, L. y Milliman, R. (2000) “Atmospheric Effects on Shopping Behavior: A Review of the Experimental Evidence”, Journal of Business Research, Vol. 49, n. 2, pp. 193-211.
© Mayo De Juan Vigaray 2007
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MERCHANDISINGPhysical environmentM.4.
ATMOSPHERICSAtmospherics
ATMOSPHERICS
The physical characteristics of the store, p y ,such as
•Architecture, Layout•Signs and Displays•Color, lightingT t•Temperature
•Noise and Odors
gara
y Together they create an image in the
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Vig an image in the
consumer’s mind
© Mayo De Juan Vigaray 2007
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(*) Kotler, P. (1973-74) “Atmospherics as a Marketing Tool” Journal of Retailing, 49, núm. 4, pp. 48-64.
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MERCHANDISINGPhysical environmentM.4.
ELEMENTS OF ATMOSPHEREAtmospherics
ELEMENTS OF ATMOSPHERE
Exterior
General Interior
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Store Layout
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Interior Displays(point-of-purchase)
© Mayo De Juan Vigaray 2007
Ma (p p )
(*) Donovan, R.J. y Rossiter, J.R. (1982) “Store Atmosphere: an Environmental Psychological Approach, Journal of Retailing, 58, pp. 34-57.