Chap Retail Communicaton Mix

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5th Edition PPT 16-1

Chapter 16 Retail Communication Mix

McGraw-Hill/Irwin PPT 16-2 Retailing Management, 5/e Levy/Weitz:

Copyright 2004 by The McGraw-Hill Companies, Inc. All rights reserved.

Merchandise Management

Planning Merchandise Assortments Retail Communication Mix

Buying Systems

Buying Merchandise


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Objectives of Communication ProgramLong-Term -Build Brand Image -Create Loyalty Short-Term -Increase Traffic -Increase Sales

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BrandsDistinguishing name or symbol, such as a logo, that identifies the products or services offered by a seller and differentiates those products and services from those offered by competitors

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Strong Brands Provide Value to Retailers and Their Customers

Value to Retailers Attract Customers Build Loyalty Higher Prices Leading to Higher Gross Margin Reduced Promotional Expenses Facilitates Entry into New Markets GapPPT 16-6

Value to Customers Promises Consistent Quality Simplifies Buying Process Reduces Time and Effort Searching for Information About Merchandise/Retailer


Building a Valuable BrandHeighten Brand Awareness Brand EquityDevelop Favorable Associations

Consistent ReinforcementPPT 16-7

Create Emotional Connections


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Benefits of High Brand Awareness

Aided Recall Top Mind Awareness

Stimulates Visits to Retailer

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Creating Brand AwarenessMemorable Name Repeated Exposure

Brand AwarenessEvent Sponsorship

SymbolsPPT 16-10

McDonalds Brand AssociationsGolden Arches Fast Food Big Mac

McDonald sFrench FriesCleanPPT 16-11

Ronald McDonald

L.L. Beans Brand AssociationsNew England Practical Friendly

L.L. BeanExpertise OutdoorsPPT 16-12


Types of Brand Association Merchandise Category Office Depot Price/Quality Target, Wal-Mart Specific Benefit 7-Eleven Convenience Lifestyle The Nature Company

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Integrated Marketing CommunicationsPresent a Consistent Brand Image through All Communications with Customers

Store Design Advertising Web Site Magalog

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Brand Extensions Gap GapKids and Old Navy


Sears Auto Centers and the Great Indoors

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Using Brand Name on New Concept

Pluses Develop Awareness and Image Quickly Less Costs Needed to Promote Extension

Minuses Associations Might Not Be Compatible with Extension

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Retail Communication Mix

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Communication Methods

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Types of Sales PromotionsSpecial sales Merchandise demonstrations Premiums Coupons Games, sweepstakes, and contests

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Comparison of Communication Methods

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Steps in Developing a Retail Communication Program

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Retail Communications Program ObjectivesLong-term Store, Private Label, Brand Building Short-term Immediate Sales Communication Objectives Affecting Specific Stages in Customers Decision Making ProcessPPT 16-22

Communication Objectives & Stages in the Consumers Decision-Making Process

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Retail and Vendor Communication ProgramsVendor Long-term objectives Product focused National Specific product Retailer Short-term objectives Category focused Local Assortment of merchandise

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Methods for Setting Communication Budget Marginal analysis Objective and task Rules of thumb - Affordable - Percent of sales - Competitive parity Sales Advertising Advertising Sales

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Marginal Analysis for Setting Communication Budget

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Illustration of Objective and Task Method for Setting a Communication Budget

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Financial Implications of Increasing the Communication Budget

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Illustrations of Communication Programs Advertising Program for a Specialty Home Furnishing Retailer Supermarket Chain Evaluating a Vendor Promotion Planning a Direct Marketing Program

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Communication Objectives Furniture StoreCommunication Objective Awareness Knowledge What stores sell Oriental furniture? Which stores would you rate outstanding on the following characteristics? Attitude On your next shopping trip for Oriental furniture, which store would you visit first? Visit Which of the following stores have you been to?PPT 16-30


Evaluation of Program

Before Awareness (% of mentioning store) Knowledge (% outstanding rating) Attitude (% first choice) Visit (% of visited store) 38% 9 13 8

6 Mon 46% 17 15 15

12 Mon 52% 24 19 19

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Considerations in Evaluating a Vendor Promotion Realized margin from the promotion

Cost of the additional inventory Potential increase in sales from the promoted merchandise Potential loss from switching Additional sales from more customer visits

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CRM Campaign Management System

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Financial Analysis of Easter Promotion

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Implementing Retail Advertising Programs Developing the Message Selecting the Media Determining Ad Frequency and Timing

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Sources of Assistance in Developing Ad Campaigns Vendors Co-Op Programs Agencies Media Companies

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Suggestions for Developing Print Ads Dominant headline

Dominant element Simple layout Specific, complete presentation Distinct visuals Name and address of storePPT 16-37

Types of Advertising MediaNewspapers Magazines Radio TV Direct mail Outdoor Shopping guide Yellow pages

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Media Capabilities

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Communication Objectives and Effectiveness of Media

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U.S. Expenditures on AdvertisingTelevision Newspaper Direct Mail Radio Yellow Pages Magazine Outdoor Internet MiscPPT 16-41

48 Billion 44 40 14 12 10 2 2 => $30B in 5 yrs 28 Total $200 Billion

Internet Advertising Applications Retailers in General Create Awareness Convey Information Brand Building -- Build Store Loyalty

Multi-Channel Retailers Build Web site Traffic

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Internet -- Advertising MediumTV, Radio Involvement Reach Targeting Information Delivery Information Richness Measurability Cost ApplicationPPT 16-43

Internet Pull, active Narrow Extensive Extensive Multi-Media High $20 mm (banner) Product Evaluation Brand Loyalty

Push, passive Broad Limited Limited Mm, audio Modest $12/8 per mm Brand Image Awareness

Types of Internet Advertising Banners - >50% of Expenditures Rich Media Microsites Sponsorships -Embedded in Site Content Email

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Problems with Measuring Effectiveness Comparison with Other Media for the Reach Counting Unique Visitors Use of Cookies Frequency Caching Prevent Cache Impact GRPs - Reach x Frequency

Comparison of Internet Advertising SitesPPT 16-45

Internet Ad Measurement Models Consumer Centric Panels -- Nielsen TV Advantages -- Representative, Relate usage to Viewer Characteristics, Comparison Across Sites Disadvantage - Small Numbers-Unreliable, Ignores Business Usage

Site-Centric Accurate Measures of Hits, Visits, Downloads, etc Problems in Measures, Cant Relate to Viewer CharacteristicsPPT 16-46

Measuring Effectiveness Internet Marketer Perspective Generating Traffic Hits - File Requested - Multiple Files Per Page Times Banner Served Page Views - Varies with Length of Page Visitors Unique Visitors Click Throughs Pages Downloaded Length of StayPPT 16-47

Generating Traffic for Site Domain Name/Brand Search Directories and Engines Registration, Top Listing

External Links - Partnerships Publicity Paid Advertising Internet Other MediaPPT 16-48

Monitoring Effectiveness of Traffic Building Approaches Monitor Sources of Visits Link Behaviors to Sources Registration Time on Site Pages Downloaded Purchases Amount Purchased

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