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Transcript of Recent Trends in Canadian Retail Increased globalization New store formats and locations ...
Recent Trends in Canadian Retail Increased globalization New store formats and locations Increased use of technology Channel blurring Changing consumer behaviour
How Retail Institutions are Evolving
Mergers, Diversification, Downsizing Cost-Containment and Value-Driven
Retailing
Figure 1.10 Applying the Retail Concept
Customer Orientation
Coordinated Effort
Value driven
Goal Orientation
RetailingConcept
RetailStrategy
Benefits of Strategic Retail Planning
Opportunity for analysis Direction Coordination of the firm’s total efforts Identify points of differentiation Appeal to a group of customers Anticipation and avoidance of crises
Sobey’s Inc. Canada
Goals: Sales growth between 6 and 8 percent Operating earnings per share growth between
12 and 16 percent Companywide capital expenditures of
approximately $550 million to $600 million National share of requirements of 20 percent Maintenance of first-quarter supplier rating
Positioning Approaches Mass merchandising is a positioning approach
whereby retailers offer a discount or value-oriented image, a wide or deep merchandise selection, and large store facilities
Niche retailing occurs when retailers identify specific customer segments and deploy unique strategies to address the desires of those segments rather than the mass market
Target Market Identification Three techniques
Mass marketing Concentrated marketing Differentiated marketing
See Table 3-3 for a detailed comparison
The Positioning Approach of High-End Jewellery Stores
1. Positioning Chart – Jewellers
2. Blurred positioning?
3. Pros and cons of Tiffany’s low price strategy
4. How would you expect the total retail experience to differ in Wal-Mart, department stores and high-end retailers?
“It is critical … for a retailer to choose his or her spots…to accept the notion that you can’t be everything to everyone.”
- Kevin Coupe, Morningnewsbeat.com
Overall Strategy Components
The Retailing Strategy Mix is a combination of: Product Price Location Communication Operations Management
Need to balance with uncontrollable environmental and marketplace factors
Controllable Factors
Wal-Mart Watch the Wal-Mart video and consider the elements of its
strategy. What does Wal-Mart do well? Is Wal-Mart the perfect retailer?
Some interesting Wal-Mart sources: http://walmart.feedroom.com/ifr_main.jsp?nsid=a-653ba03d:10d9dd
55f38:-741f&fr_story=de9a09508999541804d6a74118c1601074156570&st=1157994113989&mp=WMP&cpf=true&fr=060806_015729_wcf39d2dx10bb4c7cfaexw6ebb&rdm=2762.328875758835
http://www.walmartfacts.com/FactSheets/ http://www.pbs.org/itvs/storewars/story.html
Retail Growth StrategiesExisting
Existing
New
New
Market Segment
Retail Format
Market Penetration
Retail Format Development
Diversification
Market Development
Consider Home Depot Growth Classify the type of growth strategies
employed by Home Depot through: Home Depot Canada
Multiple store openings in one market New stores opening in previously unserved markets Smaller version stores for higher-end urban customers
Launch of their Canadian website Expo Design Center
Market penetrationMarket development
DiversificationRetail Format Dev.
Diversification
Takeaways Developing a successful retail strategy requires:
Careful analysis and planning Balancing controllable and uncontrollable
variables Accurately defining target market(s) and
satisfying their needs and wants Understanding your position in the market Coordinated effort
A retailer can become a _____ through low prices, specialized products, a large selection, and superb customer service.
a. destination retailer
b. relationship retailer
c. parasite store
d. value-based retailer
Q10
What is a parasite store?
Earning Destination Retailer Status
Be price oriented and cost efficient Be upscale Be convenient Offer a dominant assortment Offer superior customer service Be innovative or exclusive
Overall Strategy Components
The Retailing Strategy Mix is a combination of: Product Price Location Communication Operations Management
Need to balance with uncontrollable environmental and marketplace factors
Controllable Factors
Benefits of Strategic Retail Planning
Opportunity for analysis Direction Coordination of the firm’s total efforts Identify points of differentiation Appeal to a group of customers Anticipation and avoidance of crises
Retail Growth StrategiesExisting
Existing
New
New
Market Segment
Retail Format
Market Penetration
Retail Format Development
Diversification
Market Development