Chapter 2
? Explain,Value” in Retailing
? Describe Relationship Nurturing
? Examine Relationship Building
– Goods Retailers
– Services Retailers
? Discuss Impact of Technology on
Retailing
? Consider Interplay Between Ethical
Performance and Relationships
? Customers Believe Good Value
for Money
? Customer Like Doing Business
with Retailer
? Channel Members Like Doing
Business with Retailer
? Involves,
– Manufacturer
– Wholesaler
– Retailer
? Series of Activities and Processes
? Provides a Given Level of Value for
Consumers
? Closely Related to,
– Desire to Make Profit
– Type of Strategy Pursued
? Benefits from Purchase
? Cost VS Benefit
? Varies by Shopper Type
? Concerned with Outcome NOT
Process
? Expected Retail Strategy
? Augmented Retail Strategy
? Potential Retail Strategy
? Planning Value with Only A Price Perspective
? Providing Value-Enhancing Services
Customers Don’t Want or Now Willing to Pay
? Competing in the Wrong Value/Price Segment
? Believing Augmented Elements Alone Create
Value
? Paying Lip Service to Customer Service
? Customer Base
? Core Customers
? Expected
? Augmented
? Improvement
–Employee Empowerment
? Range
? Level
? Choice
? Price
? Measurement
? Retention
Cost of Offering Service
High Low
High
Patronage Builders --
High-cost activities that are the
primary factors behind customer
loyalties
Disappointers --
Expensive activities that do no
real good,
Basics --
Low-cost activities that are
“naturally expected.” They don’t
build patronage,but their
absence could reduce patronage,
Patronage Solidifiers --
The,low-cost little things” that
increase loyalty,
Low
Value of
Service
to Customer
? Advantages
– Retailer Saves Fee
– Customer Loyalty Encouraged
? Disadvantages
– Startup Costs
– Slow Cash Flow
– Administrative Costs
– Customers without Card May Be
Discouraged
? Revolving
? Option
? Open
? Meet or Exceed Expectations
? Dissatisfied Customers
–Don’t Complain
? Produces Little or No Results
? Not Easy
? Useful Rewards
? Appealing to Customers
? Attainable
? Honor Shopping Behavior
? Unique to Participating Retailers
? Personalized Communication
? Consistent
? Rewards
? Value-Added Benefits
? Customer Recognition
? Each Channel Member Dependent
? Every Value Delivery System Activity Must Be
Enumerated
? Customer Recognition
? Small Retailers May Use Outside Suppliers
? Good as its Weakest Link
? Nature Related to Target Market Expectations
? Costs & Functions Influenced by Each Party’s Role
? Increasing Complexity
? Nonstore Requires Different Delivery System
? Channel Members are Adversarial
Effective
Relationships
Common Positioning Goals
Reliability
Coordination
Communications
Input Into Channel Decisions
Trust
Fairness
Final Consumer Orientation
Activities Performed
Marketing Support
Inventory Planning
Timeliness of Payments
Proper Lead Time
Equitable Profit Distribution
Consistency
? Rented-Goods Services
? Owned-Goods Services
? Nongoods Services
Services
Retailing
Intangibility
Inseparability
Perishability
Variability
Competence
Tangibles
Understanding the Customer
Communication
Access
Reliability
Courtesy
Credibility
Security
Responsiveness
? Roles Must Be Clear
– Technology VS Humans
– Consistent With Organization Objectives
? Customers Expect Certain Advances
? ATMs
? Instant Processing
– Retail Purchases
? Smart Cards
Online Real-Time Banking
Banking by Computer
Banking by Telephone
Automated Teller Machines
In-Store Banking
Traditional Branches
? P-O-S Scanning Equipment
? Self-Scanning
? Electronic Gift Card
? Interactive Electronic Kiosks
? Mass Customization
? Articulate Acceptable Behavior
? Written Code of Ethics
? Punish Poor Behavior
? Top Managers Set Example
? Best Interest of Society
? Balance with Fair Level of Profitability
? Right to be Informed
? Right to Safety
? Right to be Heard
?,Value” in Retailing
? How Relationships are Nurtured
? How to Build Relationships
– Goods Retailers
– Services Retailers
? Impact of Technology on Retailing
? Understand the Interplay Between
Ethical Performance and Relationships
Questions?
Questions?