How to enter into an International Retail Market? MBA Marketing study material.

Global business opportunities play a very imperative role in boosting the world’s overall economy. International Retailing is one of a big contributor to a global economic boom in past two to three decades. Thanks to the globalization for crafting a chance for the retailers to come beyond the home boundaries with all their set up to serve international customers. But how to enter into an International Retail Market?  Let’s first begin with the meaning of international retailing:

What is International Retailing?

International Retailing is a business practice conducted by the retailers to serving the customers across the national boundaries by selling products or services for their personal use. Simply, it is an international trade between the retailers and the end users of the product or service.

The process involves planning, identifying and analyzing the business opportunities in the international market and setting up all the retail activities with own management to serve globally. There are many core factors involve in this process in which retailers must have look into such as, finding and analysing a lifestyle and needs of people, product modification or packaging, global marketing research, and tactics, location to set up, legal procedures, international business ethics and laws, transportation and export procedures and the list go on. But in how many ways the retailers can enter the international market? Let’s have a look:

How to enter into International Retail Market???

There are several ways to crossing international boundaries with business interests. Below some of the choices of internationalization:

·        Individual Start-Up:

Individual start-up in the international market is one of the bold steps for the retailers to take. This involves the opening a new store in outside of national boundaries with using existing brand or come up with a new brand. It has a direct control on management and operations of the store in this process. However, it has a risk to enter individually with lack of experience, study or intelligence to understand international market also, it has low rate of growth and ROI.   

·        Direct Export:

Direct exporting can be only applied for the products and not suitable for offering the services. Exporting the products to already established stores in a targeted international market is one of the easy ways to enter the international market through a merchandiser or an agent. This option of entering internationally has low risk of failure with high rate of growth to expand the business once the product get popular into the market.

·        Take Over and Mergers :

Buyout an existing international store or company with its liabilities and risks is one of the popular way to enter into the global market. Take over the well-known and reputed store can be beneficial and easy for the retailers to set up the business as it has readymade goodwill and awareness among the local population. However, it has a high risk as there is a direct control on the management after own a store. Also it become a very expensive to take over the establish store or company. Merge into another internationally established company is one of the best way to get an access into global market. In merging process retailers cannot use the own brand name for expanding the sales.

·        Joint Ventures:

This is comparably less expensive but more complicated process to enter into international market. It is an agreement between two companies whether it is international or national to invest the resources and capital for the mutual purpose of entering into the international market to expand the business. This is commonly featured by sharing the risk, ownership, returns and management. It may become more complicated practise as there may be two or more persons involved into the decisions making process.

·        Franchising:

Franchising is much popular and useful way to start the business entity initially. It is best suitable for international retail business model. Majority of the franchise retailers are engaged in food and fashion brands which is easier to move. In this process, retailers buy a franchise of some popular brands and open a store internationally under single brand with certain conditions. For more expansion, retailers need to choose the best franchiser who is already well established in international market.

·        Licensing:

Licensing is very easy and appropriate option to enter into global market to those who are at early stage of business and lack of knowledge, information, capital and resources. Taking authority of the store to run with owners’ terms and condition is called as licensing the business. It has no direct control over the management and operation. Licensing is advantageous to gain the overall knowledge of foreign market first and start your own after become an expert.

The above-mentioned ways are not the only options to start internationally. There are several more options are available such as project undertaken, land investment etc. retailers can adapt any of the above suitable options for their business expansion.

  

Customer Loyalty Program in Retail Marketing. MBA Marketing study material.

Offering extra rewards or membership invitation to the customers is nothing but the customer loyalty program conducted by the retailers. The aim of customer loyalty program in retail marketing is to influence the loyal customers to keep coming back to store for more and to increase the footfall of newbies to the store ultimately increase the sales. What exactly it means and how can it help to retail marketing? Let’s have a look in brief:

What is a Customer Loyalty Program??

It is a planned strategic program which aims to retain the customers by giving rewards, benefits or additional privilege in every purchase to them for their loyalty and regularity towards the brand.

It is the most powerful customer retention tool because delighting to loyal customers is very important only through which the mouth publicity can take place.

Also, offering rewards, bonus or any benefits to the customers will lead to encouraging them to spend more to get more through which retailers can reach a sales goal.

A successful customer loyalty program is eventually an overall success of retail marketing.

Ways to Build Customer Loyalty

There are numerous forms of rewarding the existing customers and evaluation is going on and on. But some of the popular ways are explained below:

·        Points:

Point redemption or point privilege in the retail store is very popular customer loyalty program. Customers can earn the points according to the retailer’s policy in their every frequent purchase. These points will be converted into the money or discounts or coupons etc. when customers are going to use it while next purchase. However, a points system is the only concern with to earn and spend in the same store or with the same brand and cannot use it with the other as it doesn’t include cash back policy. The main form of work of this program is to motivate the customers to come back, again and again, to spend more and more in the same store.

·        Tiered System:

A tiered system of customer loyalty program is basically a process of analyzing customer purchase behavior, recording their purchasing milestone and grouping them accordingly,   considering the frequency of purchase and how much money they spent, and offering them the rewards, prize or discounts by bearing in mind the purchasing milestones. Usually, the big scale industries are commonly using the tier system such as airlines, hospitality or insurance and banking etc.

·        Upfront Fees:

The Dictionary meaning of upfront fee is the payment before purchasing in advance. But how it can be a loyalty program for retailers? Yes, it is possible through analyzing the reasons of low footfall and customized it with charge some amount or fee to customers to detour the common purchasing obstacles. This loyalty program is beneficial for both the retailers and the customers. Amazon Prime is the best example of upfront fees loyalty program which offers you a free shipping by paying some bucks.

·        Discounts, Rebates, Cash Back:

After points system, discounts, rebates, and cash backs loyalty programs are commonly used by retailers to engage the customers and influence them to spend more. Discount or cash back is an immediate monetary benefit which can be applied for a certain period of time on any purchase. Rebate is a refund benefit for the customers who already paid for their purchase. Rebate is not an instant money benefit.  

·        Free Gifts, Free Service:

Distributing gifts and providing free services are the part of paid customer loyalty programs adopted by the retailers to maintain long-term customer relationship and build a customer loyalty. This kind of customer service can be expensive for the retailers but it may increase the footfall in store. 

·        Become a Partner:

Customer retention and customer engagement may force the retailer to make a strategic partnership with other. This strategic partnership can be effective for growing the sales, business and customer loyalty as well. To get the full benefit of this program, retailers have to check the suitable partner who is selling substitute products eventually helpful for the customers.

Customer loyalty program may vary from business to business depends on the size of it and product or service to be sell. But this is the most core area of marketing environment and without this retailers cannot sustain in such a widely spread competitive marketplace. 

Customer Service in Retail Marketing? MBA Marketing study material.

When you enter the store or a shop what are the factors that make you feel more comfortable while shopping? These factors are derived from the customer service in retail marketing. Customers always want to hear the conventional compassion while solving their problems in purchasing however, it may come to exchange products without difficulties, free repairing or sometimes giving more to senior citizens. It is beyond the communication between customers and retailers. This post focuses on how effectively retailers can provide the service to the customer?

What is Customer Service?

It is a set of services giving to the customers to assist them while purchasing, responding their questions, facilitating them to solve the problems, giving attention to every customer. To create this winning situation, retailers need to build the customer-friendly policies to make them feel they are important for retailers which surely leads to maintain long-term customer loyalty.  

What are the effective skills to provide a Customer Service?

Retailers need to make a strategic plan to provide the satisfactory and influential customer service. Below some skills or tactics which may helpful for the retailer to do so.

·        Gentle greeting at first sight:

Giving a gentle smile and greetings to the customers on their very first visit is a basic role of customer service provider or retailer. It makes a positive impact on the atmosphere for customer towards purchasing. Personal appearance should be formal and well-presented in-front of the customers. In every conversation with the customers, voice should be very kind and not too loud and words should be very clear so that everyone can understand quickly.

·        Paying attention is paramount:

Everyone wants the attention in this world. How do you feel when you enter in store and no one notice you? Do u feel outraged? Of course yes, therefore when it comes to the customer service, every customer has a right to receive a full attention from retailer and it is utmost duty of customer service provider to pay attention to customer. Customer service provider should not let the customer to wander everywhere and getting confused. Paying attention is advantageous to build customer loyalty positive attitude towards brand.

·        Personal interaction:

It is another vital duty of customer service provider after paying attention to pleasantly interact with the customer. The first interaction should be asking about how can help to them. In this stage you can get the knowledge of what customers want and the solution of this question is core aim of retailers. This interaction also involve the information about brands, product offerings, promotions etc.

·        Explain within frame:

When the customer need a solution to their need satisfaction, quickly solve their problem by offering what they want. With this, retailers may explain the products features and use. But sometimes, customer may know everything about the products and brands and need not to be over knowledgeable, in this case retailers ensure their need has satisfied and explaining with out of frame may harmful for a brand. Customers never want to come again to a store because of the overpitching of the products.

·        Be positive over negative:

This is a core responsibility of the customer service provider to clear all the doubts of the customers regarding the use of products, quality of products or even with the brand. If the customer has taking a negative impression of the product or a brand, retailers need to correct it by providing a positive and wise information without proving customers wrong, otherwise the customers feel outraged and never come back to the store.

·        Stopover outreaching:

Some customers just want to surf, checking out the products and offering and don’t have a plan to purchase. In this case, what happen if customer service provider is rushed hovering there? It make customers feel embarrass even to enter the store. So stop outreaching with the customers, let them surf first. Don’t force your services over them. Try to know how much service customers want. Pressurising to the customers may dangerous for sales.

·        Ensure bagging:

On a billing counter, retailers need to ensure the product is not defective or incorrect size before packing it, if not, change it with new one from the stock. Also, retailers need to check out the amount on bill and product should be same before getting paid. Retailer make sure the customers receive everything they paid for before leaving the store.

·        Goodbye with assuring another visit:

Sending off with the smile will be an advantage for the retailers which create a positive vibe for the customers. Saying goodbye with greetings for the day may build a longer journey of a customer with the brand or store. Retailers also ensure to encourage the customers to come and visit again to the store while sending off.

These skills or techniques of customer service in retail marketing will definitely lead to reach the goal of the store.

Customer Relationship Management in Retail Marketing. MBA Marketing study material.

Maintain and upturn the long-term relationship with the customers is a vital course for the retailers to increase the footfall of the store which eventually converts into the sales. But to make this win-win situation, how the customer relationship management in retail marketing can help the retailers? Let’s have a look further:

Customer Relationship Management (CRM) in Retail Marketing:

It is set of business strategies and system or software which focuses on customer satisfaction and building loyalty with a retailers’ most valued customers. A process or a system which constantly engage the customers by delightful offerings of retailers is called as a customer relationship management in the retail marketing environment.

It aims to convert the end users into the loyal customers at first visit to the retail store by satisfying their needs with attending their attitudes and feelings at very first purchase.

Components of Customer Relationship Management (CRM):

·         Customer Service:

Identifying, collecting and analyzing the customers’ needs and wants is the main goal of customer service support applications. Also, it is very important to analyze the customers’ complaints and suggestions to cater the business in high level. In the modern era, retailers are using various customer database software to integrate the information about every customers’ purchasing pattern their needs and behavior. Customer service is a part of front desk service which directly communicates with the customers promote the products and services and receives the information to maintain a customer database.

·         Sales Force Automation:

Salesforce automation is a very useful tool for customer relationship management. It is primarily designed for sales personals to manage their each and every customer’s records.  It includes the functionality to maintain the sales cycle such as lead generation, lead distribution, follow-ups, tracking records, design work calendar for the sales team, analysis of sales data etc. This tool also helps to forecast the sales which lead to expanding the future opportunities for the retailers. It is beneficial for managing the help-desk or customer care services such as call centers to quickly solve the customers’ problems and complaints.  

·         Market Research:

Market research involves the process of campaigning management which provides support for a marketing budget, promotional campaigns, ad placements, target market, recording customers’ response and analyze the performance of these campaigns. Market research for customer relationship management also helps to provide marketing analysis tools which give the accurate statistical and systematic data analysis.

·         Data Mining and Analytics:

Data mining is a useful process of collection, sorting, analyzing, organizing the data and use this data for identifying future demographic cross-selling opportunities and chance to improve the pattern and modify the process to maintain customer loyalty.

Analytics is an immense study of available data and represent it in a specific logical form to spot the trend or condition of the market. It shows a graphical presentation such as chart, histogram, figures, diagrams etc. of the market situation through analyzing the data. It helps to calculate the progress in customer relationship management accurately.

All of above components of customer relationship management is important to improve the work around the customer satisfaction and loyalty as well as finding the different opportunities to maintain a long-term relationship with customers.

Pricing in Retail Marketing. MBA Marketing study material.

Price of the product or service is one of the most ultimate and core source of revenue for retailers. It always directly connect with the image of the retail store. Consequently, retailers are constantly working hard on the pricing strategies to achieve the ultimate goal of profit margin. This post focuses on all of the pricing in the retail marketing environment. Let’s have a look:

Pricing in Retail Marketing:

Pricing is a process of taking managerial decisions to set the selling price of the product or service with considering various factors in the retail marketing environment.

The pricing process involves the various strategies, tactics, and plans such as comparative analysis, market situation, estimation and evaluation of cost to confirm or set the selling price of the product for the end users. Pricing in retail marketing may affect the factors like cost of the product, the perceived value of the consumers etc.

Factors affecting Pricing in Retail Marketing:

·         Cost of Product:

In a retail environment, cost of the product doesn’t mean the manufacturing cost of the product. This cost includes the transportation charges, packing charges, shop rent, cost of promotion, taxes etc. In retail marketing, there is a channel of merchandisers involved accordingly the merchandiser’s margin is another cost which the retailers have to pay.

·         Perception value of consumers:

Retailers need to consider the consumers’ perception of the value of the product or service. Also, some of the customers are more price sensitive which leads to the diminution of sales. Consumers always perceived value of the product that it should be but if it’s not according to their perception then it may influence the overall sales.

·         Competition:

Competition is the main constriction that retailers are facing nowadays. If there is a monopoly in the market then the retailers can apply the premium price for the particular product. And if there is a competition in the market then retailers need to consider the price of competitor’s product while planning strategies. Also, the pricing strategies should be consistent and reliable to get a sustainable competitive advantage.

·         Economic Constraints:

An economic constraint such as recession, the market slowdown can make an impact on the purchasing power of the consumers, therefore, if there is no demand the sales go down. Hence the country’s economy can directly influence the pricing policy of the product or service.

These are some of the core factors that can directly make an impact on the pricing in the retail marketing environment.

Integrated Marketing Communication in Retail Marketing. MBA Marketing study material

There are numerous ways of planning the strategies for the retailers to communicate effectively with their customers. At the outset, the tactics which retailers are using to make an effective communication with the people are the tools of integrated marketing communication in a retail marketing environment. Let’s get first to know what is marketing communication?

What is Marketing Communication?

Marketing communication refers to the means implemented by marketer or retailer to strokes the marketing efforts like advertising, public relation, sales promotion, campaigning, publicity etc. to convey the information about the product or service either directly or indirectly to the customers with intention of sales.

It’s nothing but the exchange of information about the product or service and makes aware of the brand, organization and its policies. It is also a part of getting a feedback in the form of information from the customers.

What is Integrated Marketing Communication (IMC)?

Integrated Marketing Communication is a strategically planned process to ensure the implementation of marketing efforts are linked together to reach the overall marketing goal.

It’s important for retailers to convey a right message to the right target market and receiving a right feedback from the customers and it is possible only through integrated marketing communication. It is nothing but the integrating the marketing or promotional tools while applying the communication efforts to customers.

 Integrated Marketing Communication Tools:

·         Advertising:

Advertising is a non-personal tool of promotion to communicate with the target market to persuade them for buying the products or services. It is a paid form of marketing through which retailers can convey the message about the brand, product, and organization overall. Advertising mainly focuses on attracting new customers by outlining a target market. TV Advertising, radio advertising, banners are commonly used forms of advertising.

·         Sales Promotion:

Sales promotion is a set of schemes or tactics for the limited period of time to increase the sales by influencing the potential market. Basically, these tactics involve the campaigns that offering extra value, incentives to the distributor or end user which aims to an immediate sale. It rarely builds long-term customer loyalty.

·         Direct Marketing:

It is a classic tool of IMC in which marketers or retailers, in case of retail marketing, directly communication one-to-one with the customers or end users and provide the information about their products or services. There are many ways to communicate directly with the customers such as personal selling, email marketing, tele-calling or point of sale etc. In modern marketing, email is the most popular form of communication.

·         Public Relation(PR):

PR is a process of communicating with the audience or target market directly or indirectly through a media or press releases to increase the awareness of product and organization. PR mostly focuses on strong and long term relationship with the target market and maintain the positive image of the organization in the marketplace.

·         Internet Marketing:

It is a modern form of marketing communication through the interactive source of the internet where there is a two way communication possible with the contribution of the target market or customers. It also called as an online marketing. Website, social media, email blasts are the commonly used features for marketing.

In retail marketing environment, integrated marketing communication tools play a very important role in a reliable way to boost the sales and profit margin. 

What is Private Label Branding in Retail Marketing? MBA marketing study material.

Private label branding in retail marketing is another fruitful raised area for the retailers to stand in the modern competitive environment. The process of producing the products which are controlled and marketed by retailers with their name is called as a private label branding. Let’s have a look into this in detail.

What is Private Label Brand?

Private label branding is the process of manufacturing the goods or products by a company or third party and sold these products under the name or label of the retailers. In this case, the retailer is responsible for the labeling everything about the product like ingredient, dates, price, usage etc. Private label brands are widely available in the local market with the range of product lines variety such as food, cosmetics, household items, personal care etc.

These products are the best alternative for nationally recognized brands as it is less expensive with the same quality and value. It can be called as a good value for money on par to the big brands. Sometimes, retailers are facing a problem of misconception about the quality of the private label brand products in public as it is available at low cost. So let’s have a look at Advantages and disadvantages of private label branding in retail marketing environment:

Advantages of Private Label Branding:

·         Regulate and maintain flexibility over the pricing:

Control over the pricing is the main advantage of private label branding. When manufacturer transfers the ownership of the products or goods, it gives the full freedom and flexibility over the pricing decisions to the retailers. So it’s beneficial for retailers to regulate price on products.

·         Higher profit margin:

As the retailers can regulate the price of these products or goods, they can earn the higher margin of profit by adding the cost to it. There is a full liberty to the retailers for their cost applying on the products.

·         Wide range of product assortment:

Private label branding always aiming for expanding its trade-in market, therefore they are offering a wide range and variety of products to fulfill the needs of the consumers. Retailers are always aware of the regular supply of the product hence private brands have always resolved the problem by offering huge assortments of products.

·         Cost effective promotion:

Private label brands can bear the cost of promotion and packaging as the retailers themselves have the ownership of the goods. In fact, putting the products in the store under the name of retailers gives the chance to build own unique image and identity in a market with no extra promotional cost.

·         Low Competition:

Private label products are always at a low price as compared to the nationally recognized brands. It gives the chance to build competitive advantage for retailers to stand in retail market reduce the competition by offering a low-cost product with same quality and value.

Disadvantages of Private Label Branding:

·         Production dependency:

In a private branding, the products are manufactured by the third party, not the retailers so, retailers have depended upon the manufacturer all the time in a production process. It’s very crucial for the retailer to deal with the well-established manufacturer to avoid any obstacles.

·         Low accessibility:

Nationally recognized brands are already established in the competitive market environment and they have upper hands. These products are available anywhere in the region. But in case of private label products, these are only available at the limited retail store and give a reason to low accessibility.  

·         Low Quality offering:

Sometimes but not often, There may be bare low-quality offerings made at a lower cost of production because not having a control over the process of production which leads to getting tough to build a loyalty among the consumers.

Even if there are some drawbacks, private label branding is still a prominent way of retail marketing to earn the benefits for the retailers.