While much of the discussion in this tutorial deals with the role of retailers in the marketing strategy for consumer products companies, it is necessary to understand the concerns of retailers as they face their own marketing challenges. Among the marketing issues facing retailers are:
Retailers know that satisfied customers are loyal customers. Consequently, retailers must develop strategies intended to build relationships that result in customers returning to make more purchases.
Acquiring the Right Products
Customers will only be satisfied if they can purchase the right products to satisfy their needs. Since a large percentage of retailers do not manufacture their own products, they must seek suppliers who will supply products demanded by customers. Thus, an important objective for retailers is to identify the products customers will demand and negotiate with suppliers to obtain these products.
Once obtained products must be presented or merchandised to customers in a way that generates interest. Retail merchandising often requires hiring creative people who understand and can relate to the market. This is often accomplished with creative in-store displays, website videos, useful apps, and catalog images.
Like any marketer, retailers must use promotional methods to build customer interest. For retailers, a key measure of interest is the number of people visiting a retail location, visiting a website or using the retailer’s app. Building “traffic” is accomplished with a variety of promotional techniques, including advertising, and specialized promotional activities, such as coupons.
For store-based retailers, a store’s physical layout is an important component in creating a retail experience that will attract customers. The physical layout is more than just deciding in what part of the store to locate products. For many retailers, designing the right shopping atmosphere (e.g., objects, light, sound) can add to the appeal of a store. Layout is also important in the online world where site navigation and mobile app functionality may be deciding factors in whether of a retail website is successful.
Where to physically locate a retail store may help or hinder store traffic. Well-placed stores with high visibility and easy access, while possibly commanding higher land usage fees, may hold significantly more value than lower cost sites that yield less traffic. Understanding the trade-off between costs and benefits of locations is an important retail decision.
Keeping Pace With Technology
Technology has invaded all areas of retailing, including customer knowledge (e.g., customer relationship management software), product movement (e.g., use of RFID tags for tracking), point-of-purchase (e.g., scanners, kiosks, self-serve checkout), web and mobile technologies (e.g., online shopping carts, purchase recommendations) and many more. Because adopting technology can potentially lead to having a competitive advantage, it is important retailers pay close attention to technologies impacting their market.