Planning a Retail Strategy
Retail sales require a lot more “theater” than wholesale. A focused marketing attitude and an appealing environment are required. To this end, there are 5 considerations
The types and variety of products / services offered is a key element in how your store is perceived by the consumer.
For example, bigger stores such as Target or Wal Mart rely on Scrambled Merchandising to appeal to a broader variety of consumer needs. Consumers perceive them to be a one-stop shopping destination that will save them time and money. More upscale stores, such as Robinsons-May or Macy’s, also use scrambled merchandising, but the focus is on more expensive brands.
Often the most difficult retail decision, where your business is located is almost always the most important decision. One location with the proper size and facilities may not provide enough foot traffic. Another location with good visibility and parking might be too expensive.
Consider the merchandise to be offered, the target market, the potential traffic, and the surrounding area. Retail shops are often found in business districts and shopping centers as well as in freestanding locations. Some companies own their buildings, while others lease their space. The trick is to find the location that best suits your needs while fitting within the budget.
Let’s face it; customers expect to pay more for an item in Macy’s than they do in Target. Something with a larger price tag in Wal Mart will most likely be seen as a “rip-off”.
Special sale prices, limited time offers, contests, and lower financing are ways to attract more consumers to the sales floor. Promotional campaigns often include multi-media advertising of one or more of these incentives.
Customers are influenced by merchandise, customer service, and aesthetics. They should be able to identify with the look and feel of the store. People who are comfortable will spend more money.
In considering these factors, keep in mind that there are 3 objectives. Strategies will change with the seemingly fickle whims of the “average consumer”, but the goals remain fairly constant.
• Attract Consumers
• Convert Consumers into Customers
• Operate Efficiently
Economic Impact of Retail
Product promotion and high consumer demand encourage increases in production, which increases employment, which increases spending.
For example, automobile manufacturers require more employees to build more cars. The transport companies that haul those cars to the dealerships also hire more people to handle the additional loads. They may have to buy more trucks, meaning the truck builder has to hire on more people.
More people with more money = more spending = more demand = more hiring = more people with more money.