TODAYS SESSION

Understanding Retail Types of Retail outlet What is Retail Marketing Importance of Retail Marketing Pillars of Retail Marketing Retail Marketing Strategy Marketing Mix in Retail Marketing The India Retail Report 2013
Facts FDI Policy Target Pool Availability

Challenges Faced By Retail Marketing Case Study-Shopper Stop

WHAT IS RETAIL ???

The word retail is derived from the French word retailer, meaning to cut a piece off or to break bulk. Retail involves the sale of goods from a single point (malls, markets, department stores etc) directly to the consumer in small quantities for his end use.

(Source: http://www.managementstudyguide.com/what-is-retail.htm)

TYPES OF RETAIL OUTLET

Department Stores: A department store is a set-up which offers wide range of products to the end-users under one roof.

Example: Shoppers Stop, Pantaloon

Discount Stores: Discount stores also offer a huge range of products to the end-users but at a discounted rate.

Example: Wal-Mart currently operates more than 1300 discount stores in United States. In India Vishal Mega Mart comes under discount store.

Supermarket: A retail store which generally sells food products and household items, properly placed and arranged in specific departments is called a supermarket

TYPES OF RETAIL OUTLET CONTINUED....

Mom and Pop Store (also called Kirana Store in India): Mom and Pop stores are the small stores run by individuals in the nearby locality to cater to daily needs of the consumers staying in the vicinity. They offer selected items and are not at all organized Speciality Stores : As the name suggests, Speciality store would specialize in a particular product and would not sell anything else apart from the specific range Example -You will find only Reebok merchandise at Reebok store and nothing else, thus making it a speciality store. You can never find Adidas shoes at a Reebok outlet. Malls: Many retail stores operating at one place form a mall. A mall would consist of several retail outlets each selling their own merchandise but at a common platform.

TYPES OF RETAIL OUTLET CONTINUED....

E Tailers: Now a days the customers have the option of shopping while sitting at their homes Example - EBAY, Rediff Shopping, Amazon Dollar Stores: Dollar stores offer selected products at extremely low rates but here the prices are fixed. Example - 99 Store would offer all its merchandise at Rs 99 only. No further bargaining is entertained. However the quality of the product is always in doubt at the discount stores.

(Source: http://www.managementstudyguide.com/types-of-retail outlets.htm)

DEFINITION OF RETAIL MARKETING

Retail marketing is the range of activities undertaken by a retailer to promote awareness and sales of the companys products This is different from other types of marketing because of the components of the retail trade, such as selling finished goods in small quantities to the consumer or end user, usually from a fixed location Retail marketing is especially important to small retailers trying to compete against large chain stores. (Source: http://smallbusiness.chron.com/definition-retail-marketing40196.html)

IMPORTANCE OF RETAIL MARKETING

Competition has gotten stiff. Customers have more choices. Stores have to reach them with advertising, entice them with promotions, and secure them with branding Hence the ever-growing need for marketing in retail outlets.
(Source: http://www.ehow.com/about_6704435_importance-retailmarketing.html)

PILLARS OF RETAIL MARKETING

The customer is the most important person in your business. Retail is detail. Understand the four Ps. Go the extra mile for your customer. Location, location, location.

(Source: http://www.marketingdonut.co.uk/ marketing/marketing-strategy/thefive-principles-of-retail)

RETAIL MARKETING STRATEGY

-Elements -Method for segmentation -How to build a sustainable competitive advantage

ELEMENTS OF RETAIL MARKETING STRATEGY

Target

Market Customer Needs Format Method for Satisfying Needs

Retail

Bases

for Building Sustainable Competitive Advantage Defending Position Against Competitors

METHODS FOR SEGMENTING MARKETS

Geographic Demographics Lifestyle, Psychographics

HOW TO BUILD SUSTAINABLE COMPETITIVE ADVANTAGE

Dropping the Price of Your Merchandise. Building a Store at the Best Location. Deciding to Sell Some Hot Merchandise. Increasing Your Level of Advertising.

Attracting Better Sales Associates by Paying Higher Wages.

Providing Better Customer Service.

MARKETING MIX IN RETAIL MARKETING

PRODUCT

Various in-house brands are promoted. Provides best products at the best price. Big Bazar sold over 300000 pair of jeans, 50,000 DVD players and 25,000 ovens.

PRICE

Pricing is an integral part of the retail marketing mix It depends on whether the product offering is unique or has other substitutes available

For Example: The tag line of Big Bazar is Is se sasta aur accha aur kahin nahi

PLACE

For a very long time the location of the retail store was considered to be the most important element of the retail marketing mix You must provide somewhere for your customers to purchase your product, be that a physical store, a catalogue or an ecommerce website.

PROMOTION

Once you have a product at the right price, in a place where the customer can access it you need to tell them about this and promote your business and your products make sure your customers know that you and your products exist and are available for them to enjoy.

THE INDIA RETAIL SECTOR

Report-2013

FACTS ABOUT INDIA RETAIL SECTOR

The Indian retail market is estimated to exceed US$ 750 billion by 2015, according to the India Retail Report 2013 (IRIS Research), presenting a strong potential for foreign retailers planning to enter India. Until 2011, the Indian Central Government denied Foreign Direct Investment (FDI) in multi-brand retail, forbidding foreign groups from any ownership in supermarkets, convenience stores or other retail outlets In late 2012, the Government of India passed a Foreign Direct Investment policy which allows foreign retailers to own up to 51 per cent in multi-brand retail and 100% in single brand retail According to A T Kearneys Global Retail Development Index (GRDI) 2012, India is the 5th most favourable destination for international retailers

Of the total Indian retail market, 8% constitutes the organised retail segment which is estimated to grow at a rate of almost 30% by 2015

FDI POLICY

The new FDI policy implies greater autonomy in functioning for foreign single-brand retail players who can now own 100% of their Indian stores, up from the previous cap of 51% with only the stipulation that they will have to source 30% of their goods from small and medium-sized Indian suppliers The new policy allows a maximum 51% ownership for the multi brand retail sector subject to the following conditions: Each Indian state government has the option to accept or reject the implementation of this policy. Retailers can only set up in cities with a population of more than 1 million (total of 53 cities in India) provided they have the approval from the respective state governments. The figure below shows state wise acceptance of this new policy. Currently 18 cities are eligible for multi brand retailers to enter under this new policy. Multi-brand retailers must have a minimum investment of US$100 million with at least half of the amount invested in back end infrastructure. They will have to source 30% of their goods from small and medium-sized Indian suppliers. E-commerce is not allowed as an alternate channel as it can serve the customer beyond the physical location of the store.

TALENT POOL AVAILABILITY

The introduction of the FDI in retail policy will impact the availability of talent. Many institutes have now introduced specialised post graduate degrees in retail management.

According to Michael page, the current trends and the rapid growth of the market will create an acute shortage of talent at the mid to senior level, creating high demand for candidates that are experienced in setting up large retail chains as well as candidates with international exposure

RETAILERS HAVE SPONSORED COURSES IN SOME OF THE TOP B-SCHOOLS TO ATTRACT TALENT AT A JUNIOR LEVEL AS SHOWN IN TABLE BELOW

Name of Retailer Pantaloon Kirloskar group RPG group Future group Birla group Garware group

Institutes with Sponsored Retail Courses L.N Welingkar KIAMS RPG institute of retail management IGNOU Bimtech Garware institute of management

CHALLENGES IN RETAIL MARKETING

Retail stores that sell directly to consumers face a different set of marketing challenges than other industries. Different Challenges faced by retail marketing are as follows: High-Ticket Items Require a Consumer Sacrifice Small Stores Have Limited Merchandise Trendy Stores are Expensive

HIGH-TICKET ITEMS REQUIRE A CONSUMER SACRIFICE

Especially in tough economic times, many consumers may think that purchasing high-ticket items requires them to make a long-term sacrifice. To be able to afford the costly item, a consumer may have to cut back spending in other areas. To market these high-ticket products, retailers must focus on how the item benefits buyers, convincing customers it is worth the perceived sacrifice. Other retailers have used payment plans that do not charge interest for a certain period of time as a way of making the big-ticket item affordable.

TRENDY STORES ARE EXPENSIVE

Trends in retail stores are often what make a store successful. Often consumers relate trendy stores with higher price tags. Marketing these higher-end products is a challenge and overcoming this perception with targeted advertisements informs consumers that the store carries the latest products at affordable prices.

SMALL STORES HAVE LIMITED MERCHANDISE

Small retailers often have a hard time competing with bigger retail stores as many consumers assume smaller stores have smaller selections. Challenges that small retailers face is how to create marketing campaigns that make the store seem more broad-based.

For many small retailers, this may require hiring professional marketers or graphic designers to create print or online advertisements.

RETAIL MARKETING CASE STUDY SHOPPERS STOP

About Shoppers Stop Shoppers Stop is one of the first retail chains started in india in 1991 by the Raheja Group. It now boasts of 27 retail outlets across the country and is one of India's largest retail chains, having expanded from apparel and accessories to home furnishings and books under the Home Stop and Crossword Brands. Other Brands under the Shoppers Stop umbrella are MotherCare, Desi Cafe, Brio, Nuance, Arcelia, Timezone and Hypercity

THE CHALLENGE

Executives at the Shoppers Stop Group noticed their sales falling into the 80:20 pattern with loyalty card customers despite being only 15% of the base contributing over 70% of the revenues of Shoppers Stop.

The Group realized that since they have data on loyalty card holders, if they could understand who the customer really is, what she buys, when she buys and why, they may be able to fine tune their offerings to provide the customer a better experience and increase their share of wallet.

SOLUTION

Shoppers Stop conceptualized 'Project Drishti', a data warehouse and mining project in 2007 and launched it in 2008 way ahead of competition. The objective of the project was to streamline data obtained from customers across all its stores and loyalty programs and convert it into analytics that could be used for decision making.

HOW PROJECT DRISHTI HELPED THEM...?

Project Drishti led to the Group being able to identify and understand their target segments across various stores and programs and create meaningful targeted campaigns for their bigger spenders.

It also enabled the company to identify cases where multiple stores in the same city were losing business to each other instead of external competitors.
The most important fact is that that Shoppers Stop has equipped itself with the weapon for the future"Customer Intelligence

REFERENCES

http://www.managementstudyguide.com/what-is-retail.htm http://wooqer.hubpages.com/hub/Retail-Marketing-Case-StudyShoppers-Stop http://www.fibre2fashion.com/industry-article/31/3043/the-conceptof-retail-marketing1.asp http://www.youtube.com/watch?v=Ymvz9SXQNCk https://www.youtube.com/watch?v=I6risy_4QTI http://www.marketingdonut.co.uk/marketing/marketingstrategy/the-five-principles-of-retail http://www.authorstream.com/Presentation/RamanPathak891763437-big-bazaar-retail/ http://www.citeman.com/9778-the-retail-marketing-mix.html http://www.michaelpage.co.in/websitepdf/IN_Retail_sector_report_ 2013.pdf http://www.aug.edu/~sbadph/mktg3720/3720stu05e5.pdf