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. 

Merchandising in Retail Marketing. MBA Marketing study material.

From at the beginning of choosing specific products to sell, buying it in wholesale till the end of the process by resale it to the end users and make a profit is a model of merchandising in the retail marketing environment.  Merchandising is a common practice of every set of business where products are displaying and selling to the end users. To influence the consumers and increase the sales volume is the main function of merchandising, whether it’s digital or in-store.

Merchandising:

“It is a process of offering a right product, with a right quantity, in right place, at right time to the right person to meet the organization’s financial goal”

Merchandiser:

“A person whether a wholesaler or a retailer, who buy the products or goods from the several sources for resale to the end users to make a profit is called as a merchandiser”.

Merchandiser always bond to a higher standard of duty of care as he supposed to have expert knowledge about products he engaged in.

Role of Merchandiser:

A merchandiser typically responsible for-

Planning and Forecasting:

Selecting a product category and Forecasting the budget and sales in the selected area.

Leading and Sourcing:

Leading and guiding the team and searching for various appropriate sources to purchase the products. Making a purchase order with suppliers.

Maintaining budget:

Making sure about the cost of products and budget planned. Work on the cost of the products

Co-ordinating and Controlling:

Co-ordinating with the suppliers about the shipment and controlling the stock or inventory purchase.

Evaluating Sales:

Analysing the performance of product and process and evaluating sales and profit margin.

Retail Merchandising Management Process:

·         Analysis:

It is vital to understand the needs or wants of consumers to the retailer. A retailer needs to identify and analyze target audience before pitching the products.

·         Planning:

Planning involves the process of selecting the right product, from the right supplier and sells it at the right price, in right place and at right time and quantity.

·         Acquisition:

Retailers need to take a lead to purchase the selected products in the estimated budget by appropriate suppliers. Retailers can purchase the goods from one or more than one suppliers.

·         Pricing:

In this step, retailers need to make a decision on the pricing structure of the products which are going to sell. It’s important making sure about the profit margin considered while making a price structure.

·         Handling and Control:

Maintaining a stock of goods is very important and costly process for every retailer. This is a process of spending money on maintaining a stock of goods at right time and in a right condition.

As we can see in this post, merchandising is a routine activity of every retailer. In retail, no one can avoid the merchandising.

Strategies for Retail Marketing. MBA Marketing study material.

Planning marketing strategies for retail business is an immense decision process especially when retailers are not getting enough footfall for the store. The process involves the strategies from the target market, positioning, retail format to sustainable competitive advantage. Strategies for retail marketing is a process of making wise decisions on every marketing action involved in the retail business. Retail store strategies are nothing but the decision-making process while applying retail marketing mix.

Following are the points to be considered while planning the strategies for retail marketing.

·        Target Market:

Target Market is a part of market segmentation where the whole market has divided into a subgroup according to the common features and selecting or focusing on the appropriate group(s) for smearing various marketing resources and retail marketing mix. Targeting a market allows the retailers to make a choice of product assortment, level of service delivery, a place to trade etc. Target market helps to grow business with little competition and more profit margin which leads to consistency in competitive advantage.

·        Retail Positioning:

Positioning in retail businesses is how the retailer positioned in the final market by differentiating itself with product or services offerings. Positioning assists the retailers to raise the competitive advantage by differentiating itself from competitors and can readily recognizable by its target market.

·        Retail Format:

The format of a retail store is a general nature of the business operation in terms of marketing mix such as range of product and services, pricing strategies, promotional programmes, store design etc. There are many types of retail store formats which are explained in the previous post such as supermarket, department store, shopping malls, convenience store etc.  

·        Sustainable Competitive Advantage:

Competitive advantage is an outperformance of store over competitors. It only exists when the store in retail business consistently outperforms other stores in the same market. The store is able to maintain it for a long period of time then it can be a sustainable competitive advantage for the store. Long-term competitive advantage should not be easily duplicable by the competitors. It is an ability of a store that difficult to exceed.   

Strategic Retail Planning Process:

The strategic retail planning process is a set of steps that retailers take in order to figure out how to target, positioning the market and how to maintain a sustainable competitive advantage. Following are the steps for strategic retail planning process:

1.      Define Store’s Mission and Objective:

At first step, retailers need to make a mission statement which involves a broad description of retail store objectives and long-term plan to undertake.

2.      Conduct a Situational Audit (SWOT Analysis):

A situational audit is a very common strategic tool to analyze store’s strength, weakness, opportunities, and threats (SWOT) in a retail environment.

3.      Identify Strategic Opportunities:

To improve the sales dimensions, searching for the opportunities is a key step. By getting and evaluating the strategic opportunities it concludes the abilities of retailers to establish a bearable competitive advantage.

4.      Establish Objective and Assign Resources:

After evaluating the opportunities it’s time to place objectives or aims for each and every opportunity to reach towards a main retail objective.

5.      Develop Retail Mix:

In this step, a retailer has to invest the resources into a retail marketing mix. Retailers need to make a decision on a product, price, place to distribute and promotional activities.

6.      Analyse the Performance:

In case of failure of any strategy, a retailer needs to study each step taken to analyze the performance and change the plan accordingly to meet the objective. 

Store Location and Layout in Retail Marketing. MBA Marketing study material

Designing a retail store location and layout is a process of using store place in a premeditated and tactical way to influencing the customers and boost the sales margin. Store location and layout designing are directly affected by consumer’s buying behavior. The escalation in footfall into the store place mostly depends upon the interior, layout, location of the store. This post gives a wide-ranging overview of store location and layout in retail marketing.  

Types of Retail Store Location:

1.      Mall Space:

Malls consist big center in which many brands and retailers are competing with each other under one roof as discuss in types of retailers. There are a variety of stores and shops format in mall space. Leasing amount in the mall is much bigger as compared to other locations.

2.      Shopping Centres:

These are the strip malls, commercial building with retail shops or shopping complex where there is a range of retail shops exist. Leasing contract with shopping centers indulgent than a mall. There are minimum 3 units up to 20 shops in one building with limited parking area.

3.      Downtown Area:

Downtown is a core area which is located in heart of the city. Getting a store on lease basis is much easier with fewer rules. The store may locate in a commercial building or strip shops. It’s a premium choice of store location in this kind of area but limited parking space is a big issue for this.

4.      Free Standing Locations:

Free standing location is any area or single detached building or residence which can be used for business operations. This can be located in the neighborhood, any busy highways or residential areas. This is beneficial in terms of leasing amount with free from rules.

5.      Home-Based:

Initially, all the businesses get a kick from home itself, but some of the businesses are taking a decision to continue with it in the home itself. This location is inexpensive and reliable but a challenge is to attract customers in this kind of locations.

Types of Retail Store Layout:

1.      Straight Layout: Ideal use of walls and create a free space to move freely :

2.      Diagonal Layout: Crosswise arrangement of racks:

3.      Angular Layout: Curve shape arrangements with a sophisticated design:

4.      Geometric Layout: Trendy design with symmetric arrangements with racks.

5.      Mixed Layout: Mixture of Diagonal, geometric and angular layout space: