5 th Edition PPT 16 1 Chapter 16

5 th Edition PPT 16 -1

Chapter 16 Retail Communication Mix Mc. Graw-Hill/Irwin PPT 16 -2 Retailing Management, 5/e Levy/Weitz: Copyright © 2004 by The Mc. Graw-Hill Companies, Inc. All rights reserved.

Merchandise Management Planning Merchandise Assortments Buying Systems Retail Communication Mix Buying Merchandise PPT 16 -3 Pricing

Objectives of Communication Program Long Term PPT 16 -4 Short Term Build Brand Image Increase Traffic Create Loyalty Increase Sales

Brands Distinguishing 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 PPT 16 -5

Strong Brands Provide Value to Retailers and Their Customers Value to Retailers • Attract Customers • Build Loyalty Value to Customers • Higher Prices Leading to • Promises Consistent Quality Higher Gross Margin • Reduced Promotional Expenses • Facilitates Entry into New Markets Gap. Kids PPT 16 -6 • Simplifies Buying Process • Reduces Time and Effort Searching for Information About Merchandise/Retailer

Building a Valuable Brand Develop Favorable Associations Heighten Brand Awareness Brand Equity Consistent Reinforcement PPT 16 -7 Create Emotional Connections

Tar Zhay PPT 16 -8

Benefits of High Brand Awareness Aided Recall Top Mind Awareness PPT 16 -9 Stimulates Visits to Retailer

Creating Brand Awareness Memorable Name Repeated Exposure Brand Awareness Symbols PPT 16 -10 Event Sponsorship

Mc. Donald’s Brand Associations Golden Arches Fast Food Big Mac Mc. Donald’s French Fries Ronald Mc. Donald Clean PPT 16 -11

L. L. Bean’s Brand Associations New England Practical Friendly L. L. Bean Expertise Honest Outdoors PPT 16 -12

Types of Brand Association • Merchandise Category – Office Depot • Price/Quality – Target, Wal Mart • Specific Benefit – 7 Eleven Convenience • Lifestyle – The Nature Company PPT 16 -13

Integrated Marketing Communications Present a Consistent Brand Image through All Communications with Customers • Store Design • Advertising • Web Site • Magalog PPT 16 -14

Brand Extensions • Gap. Kids and Old Navy • Sears Auto Centers and the Great Indoors PPT 16 -15

Using Brand Name on New Concept Pluses Minuses • Develop Awareness and Image Quickly • Associations Might Not Be Compatible with Extension • Less Costs Needed to Promote Extension PPT 16 -16

Retail Communication Mix PPT 16 -17

Communication Methods PPT 16 -18

Types of Sales Promotions Special sales Merchandise demonstrations Premiums Coupons Games, sweepstakes, and contests PPT 16 -19

Comparison of Communication Methods PPT 16 -20

Steps in Developing a Retail Communication Program PPT 16 -21

Retail Communications Program Objectives Long term • Store, Private Label, Brand Building Short term • Immediate Sales Communication Objectives • Affecting Specific Stages in Customer’s Decision Making Process PPT 16 -22

Communication Objectives & Stages in the Consumers Decision Making Process PPT 16 -23

Retail and Vendor Communication Programs Vendor Retailer • Long-term objectives • Short-term objectives • Product focused • Category focused • National • Local • Specific product • Assortment of merchandise PPT 16 -24

Methods for Setting Communication Budget • Marginal analysis Advertising Sales • Objective and task • Rules of thumb Affordable Percent of sales Competitive parity PPT 16 -25 Sales Advertising

Marginal Analysis for Setting Communication Budget PPT 16 -26

Illustration of Objective and Task Method for Setting a Communication Budget PPT 16 -27

Financial Implications of Increasing the Communication Budget PPT 16 -28

Illustrations of Communication Programs • Advertising Program for a Specialty Home Furnishing Retailer • Supermarket Chain Evaluating a Vendor Promotion • Planning a Direct Marketing Program PPT 16 -29

Communication Objectives Furniture Store Communication Question Objective Awareness What stores sell Oriental furniture? Knowledge 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 12 Mon 46% 52% Awareness (% of mentioning store) 38% Knowledge (% outstanding rating) 9 17 24 13 15 19 8 15 19 Attitude (% first choice) Visit (% of visited store) PPT 16 -31 6 Mon

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 PPT 16 -32

CRM Campaign Management System PPT 16 -33

Financial Analysis of Easter Promotion PPT 16 -34

Implementing Retail Advertising Programs • Developing the Message • Selecting the Media • Determining Ad Frequency and Timing PPT 16 -35

Sources of Assistance in Developing Ad Campaigns • Vendors – Co Op Programs • Agencies • Media Companies PPT 16 -36

Suggestions for Developing Print Ads • Dominant headline • Dominant element • Simple layout • Specific, complete presentation • Distinct visuals • Name and address of store PPT 16 -37

Types of Advertising Media C Newspapers C Direct mail C Magazines C Outdoor C Radio C Shopping guide C TV C Yellow pages PPT 16 -38

Media Capabilities PPT 16 -39

Communication Objectives and Effectiveness of Media PPT 16 -40

U. S. Expenditures on Advertising Television Newspaper Direct Mail Radio Yellow Pages Magazine Outdoor Internet Misc PPT 16 -41 48 Billion 44 40 14 12 10 2 2 => $30 B 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 PPT 16 -42

Internet Advertising Medium PPT 16 -43

Types of Internet Advertising • Banners >50% of Expenditures • Rich Media • Microsites • Sponsorships Embedded in Site Content • Email PPT 16 -44

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 Sites PPT 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, Can’t Relate to Viewer Characteristics PPT 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 Stay PPT 16 -47

Generating Traffic for Site • Domain Name/Brand • Search Directories and Engines – Registration, Top Listing • External Links Partnerships • Publicity • Paid Advertising – Internet – Other Media PPT 16 -48

Monitoring Effectiveness of Traffic Building Approaches • Monitor Sources of Visits • Link Behaviors to Sources – – – PPT 16 -49 Registration Time on Site Pages Downloaded Purchases Amount Purchased