Chap004 (1) Retailing)

8/8/2019 Chap004 (1) Retailing)

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PPT 4-1

McGraw-Hill/IrwinLevy/Weitz: Retailing Management, 5/e Copyright 2004 by The McGraw-Hill Companies, Inc. All rights reserved.

CustomerCustomer

Buying BehaviorBuying Behavior

Chapter 4Chapter 4


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PPT 4-2

Types of Buying Decisions

Extended Problem Solving

-High financial Risk, time and effort

Limited Problem Solving

-Some Prior Buying Experience

Habitual Decision Making

-Store Brand, Loyalty


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PPT 4-3

What Retailers Need to do for Customers Engaged in

Extended Problem Solving

Provide a Lot Information

-Use Salespeople rather than advertising to

communication with customers

Reduce the Risks

-Offer Guarantees

-Return Privileges


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PPT 4-4

What Do Retailers Need To Do for Customers Engaged in

Limited Problem Solving

It Also Depends

If the Customer Is Coming to You, Provide a Positive

Experience and Create Loyalty

Make Sure Customer is Satisfied

Provide Good Service, Assortments, value

Offer Rewards to Convert to Loyal Customer

If the Customer Goes to Your Competitors Store,Change Behavior

Offer More Convenient Locations, Better Service and

Assortments


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Encouraging Impulse Buying

Have Salespeople Suggest Add-ons

Have Complementary Merchandise Displayed Near

Product of Interest

Use Signages or Special Displays

Put Merchandise Where Customers Are Waiting


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PPT 4-6

What Retailers Need to do for Customers to

Engage in Habitual Decision Making

It Depends

If the CustomerHabitually Comes to You, Reinforce

Behavior

-Make Sure Merchandise is in Stock

-Provide Good Service

-Offer Rewards to Loyal Customer

If the Customer Goes to Your Competitors Store,Break the Habit

-Offer Special Promotions


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Customer Loyalty

Brand Loyalty

Committed to a Specific Brand

Reluctant to Switch to a Different Brand

May Switch Retailers to Buy Brand

Store Loyalty

Committed to a Specific Retailer

Reluctant to Switch Retailers


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PPT 4-8

Why People Go Shopping

Purchase merchandise or services

Take a break from daily routine

Social experience

Learn new trends and fashions

Satisfy need for status

Self-rewards


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PPT 4-9

Stages in the Buying Process


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PPT 4-10

Stimulating Need Recognition

Advertising and Direct Mail

Visual Merchandise in StoreSignage

Displays

Suggestions by Sales Associates


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Factors Affecting Amount of Information Search

Characteristics of the Product

Complexity

Cost

Characteristics of Customer

Past experience

Perceived risk

Time pressure

Market Characteristics

Number of alternative brands


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Sources of Information

External

Consumer reports

Advertising

Word of mouth

Internal

Past experiences

Memory


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How Can Retailers Reduce Information Search?

Extensive merchandise assortment

Assistance in locating alternatives

Provide information on internet

Credit/deliver

Information from sales associates


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PPT 4-15

Information about Retailers Selling Groceries


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PPT 4-16

Belief About Retailers Performance Benefits


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Information Used in Evaluating Retailers


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Information Used in Purchasing a Suit


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Methods for Increasing Consumer Evaluation

Increase Performance Beliefs of Your Store

Increase Importance Weight of Attributes on

which You Have an Advantage

Add a New Benefit on which You Excel


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Purchasing the Merchandise

Dont stock out of popular merchandise. Have a

complete assortment of sizes and colours for

customers to buy.

Make it easy to purchase by having convenientcheckout terminals.


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Post purchase Evaluation


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Factors Influencing the Buying Decision Process


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PPT 4-23

Social Factors Influencing Buying Decisions

Family

Reference Group

Culture


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PPT 4-24

Methods for Segmenting Retail Markets

Geographic Demographic

Feelings and Behaviors

Lifestyle

Segmenting Markets


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Geodemographic Segmentation

Birds of a featherFlock Together

Latino America

Hispanic Middle Class

Boxing (+)

Dance Music (+)

Barbequing (-)

Avocados (+)

Cosmopolitan (+)

Touched By an Angel (+)

Latino America

Hispanic Middle Class

Boxing (+)

Dance Music (+)

Barbequing (-)

Avocados (+)

Cosmopolitan (+)

Touched By an Angel (+)

Town and Gown

College Town Singles

Foreign Films (+)

Dogs (-)

Sewing (-)

Coca Cola (+)

Fast Food (+)

Friends (+)

Sports Illustrated (+)

Town and Gown

College Town Singles

Foreign Films (+)

Dogs (-)

Sewing (-)

Coca Cola (+)

Fast Food (+)

Friends (+)

Sports Illustrated (+)


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Distribution of Grey Collar Aging Couples Near

Suburbs


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Lifestyle Segmentation

VALS

Action Oriented

High Resources

Follow Fashions and Fads

Spend a lot on socializing,

entertainment

Impulse buyers

Influenced by advertising

Believers

Lower resources

Buy American

Look for bargains

Watch TV a lot

Read home and garden

magazines


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Criteria for Evaluating Segmentation Schemes

Actionability

Identifiability

Accessibility

Stability

Size


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Example of a Composite Segmentation Scheme


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What is Fashion?

A type of product or way of behaving that is

temporarily adopted by a large number of

consumers because it is viewed as socially

acceptable.


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What Creates Fashion?

Economic Factors

Sociological Factors


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Factors Affecting Fashion

Economic Development

Social Environment

Class structure

Role of men and women

Structure of the family

Personal Issues


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Stages in the Fashion Life Cycle


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What Affects the Rate Fashion Spreads?

Advantage

Compatibility

Complexity

Trialability

Observability


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Theories ofFashion Diffusion

Trickle-Down Theory

Mass Market Theory

Subculture Theory

Documents

Chap004 (1) Retailing)