A presentation on

Merchandise management
 Concept ‘Merchandise’
 Type of products to be sold at the retail store is an important
aspect of retail business.
 The right type of product is a key aspect in the retail business
success. Thus, merchandise is the core of retailing.
 Merchandising and merchandise management are the same and
can be used interchangeably.
 Merchandised management refers to the management of different
aspects of the product the retailer keeps for sale to the customers.
 Term ‘merchandise’ indicates a range of products retailers wants
to sell to the end consumers.
 The success of any retail operation, to a great extent, depends upon retailer’s
ability to provide right products to the consumer at the right place, at the right
time and at the right price.
 An officer who is responsible for merchandise management is called
merchandiser.
 Definition
 American marketing Assocaition:
 “Merchandising is the planning involved in selling the right merchandise at
the right place, at the right time, in the right quantity, at the right place.”
 In simple words we can define the term as: Merchandise management is a
process of planning, buying, and selling, of merchandise.
 Right products should be available, at the right place, at the right time,
in the right quantity, at the right price.
 Merchandising management is closely related to category management,
because a retailer has to maintain different category of product to attract
and satisfy the shoppers.

 Key decision of retail management

 1. Identifying the right products for retailing. ( what to sell?)
 2. Procuring the right products, (from whom and how to buy?)
 3. Reaching the end consumers, ( how to sell to consumers?)
 4. Ensure the right level of inventory on a continuous basis
 Merchandise management process

 In fact merchandising is the day to day business of all retailers.

Key aspects of merchandise management include estimating
demand, choosing the right sources, procure the products,
maintain stock, reordering the quantity, arranging products on
the shelves are key issues in merchandising.
 1. Formulating broad Merchandise strategy
 A merchandiser is responsible to ensure that right type of products should be
available, at the right time, at the right place, at the right price and in the right
quantity.
 A merchandiser is not directly involved in procurement of merchandise, but
he formulates merchandise strategies to guide the staff dealing with
merchandising.
 For formulating strategy systematic study of retail business environment is
very important. It includes business trends, shopper’s behavior, competition,
legal provisions, etc.
 Timing to buy merchandise, sources of merchandise,pricing and payment of
bills, vendors selection , inventory management are some of the key areas of
merchandise strategy.
2.Planning of merchnadise
 Merchandise is often said to be core of the retail business. Merchandise to
be sold in the future is to be brought now. Overall consistency of
merchandise with the customer needs and wants is a key criterion to keep
in mind.
 A merchandiser under the direct supervision of the top authority
formulates merchandise planning. Merchandise planning procedure
depends on type of retail format. For Ex, in case of an independent and
isolated retail business, a retailer himself works out merchandise planning.
 In case of organized retailing a special officer or a team of officers does
merchandise planning.
 Estimating demand for the given merchandise is a key in merchandise
planning.
 Important decision
 What to buy? Type of merchandise
 How much to buy? quantity
 When to buy ? Time to buy merchandise
 Whom to buy? Source of merchandise
 How to buy ? Terms and conditions of buying
 How to pay bills ?
 How to transport? Modes of Transportation
 Where to store the merchandise ? Storing the Merchandise in the
warehouses
 3. Merchandise sourcing
 Merchandise sourcing includes procurement of
merchandise from the relevant sources- merchandise
vendors. Suppliers, and / or manufacturers.
Merchandise sourcing refers to a process of purchasing
the merchandise from the appropriate sources and
storing the same to ensure continuous availability for
retail business.
 A merchandise manger himself finalize the deal or he
appoints a committee to negotiate with the vendors.
 Vendor selection is very important decision and it depend on many criteria
like type of vendors( Manufacturer and/or suppliers), reputation, type and
category of merchandise, business experience with the vendor, price,
special offer, facilities offered by the vendor, and some others.
 Process of merchandise sourcing
 1. Identifying source of supply
 2. Contacting and evaluating source of supply
 3. Negotiating with the vendors
 4. Placing the orders
 5. Establishing vendor relation
 6. Analyzing vendor performance
 4. Merchandise allocation
 Allocation of merchandise to the various retail stores is also an integral part of
the merchandise management.
 After an effective procurement of merchandise, the next task is to distribute
merchandise to the stores. Merchandise allocation functions depend on type of
retail format.
 In case of organized retailer a store manager must be consulted to decide on
what, when, and how much of merchandise to allocate.
 A single independent retailer allocate entire amount of merchandise to the store
while retail chains allocate as per the requirement of different stores located at
different places.
 In short, merchandise should be allocated as per requirement, this is necessary
to avoid a stock out situation in any type of requirements.
 5.Monitoring and evaluating performance: Monitoring and evaluating
the performance involves verifying whether the merchandise
management functions effectively. This is , in fact a controlling
function applied to merchandise management.
 Once the merchandise system is fully implemented, it is evaluated at
the right interval to ensure that it works effectively as expected. In
case, if any type of defect is detected, it needs to be urgently rectified.
 Minor and major changes modification should be adopted keep the
merchandise up to date.
 Measuring performance of merchandise is necessary in order to know
performance of different products.
 Retail store design &visual merchandising

 Store design and visual merchandising are closely

associated decisions of retail business.
 Be clear that visual merchandising relates to arrangement
of merchandise in the store while store design is a broad
concept that encompasses all types of arrangement inside
and outside the store, including visual merchandising. In
this sense visual merchandising is a part of a store design
 Retail store design
 Every type of retailer is required to focus on store design and visual
merchandising to attract, persuade, please, and inspire the customers
to purchase the products.
 There are two types of retail store design, an interior store design and
an exterior store design.
 Be clear that visual merchandising is a part of interior store design.
 Visual merchandising refers to an attractive and systematic
arrangement of merchandise in the store.
 Store design is an important facet of retail business strategy.
 Once an appropriate location has been selected, the next
important task of a retailer is to decide on the exterior and interior
appearance of the store.
 Store design has a special role in attracting the shoppers at the
store. A retailer can create a difference.
 An innovative retailer can find an ample room to be different, to
be creative, and to be impressive.
 Retail store design and visual merchandise can really a matter of
creating store image. The store image is the customer perception
of the store and its attributes.
 Store design is mixture or combination of
(1) display of merchandise (called visual merchandising), (2) space
management, (3) interior and exterior outlook, and (4)
accommodation of necessary facilities and staff. Retail store design
can create a comfortable and pleasing shopping atmosphere.
 Benefits of a suitable retail store design : Some benefits includes
create store image, win customer loyalty, enhance sale, economy,
maximize returns per square foot or per square meter, allow
comfort and flexibility in store design, provide assistance for
disabled customers, ensure safety, and so forth.
 Interior and exterior design
 A retailer’s task consists of satisfying the customers. A retail shop exists to
cater customer needs and expectations.
 Clearly, the store design tells a lot to customers what the store is all about.
 It is a powerful tool to communicate about stores and create the image. Store
design is like a store personality that influences the viewers and visitors.
 There are two types of retail store designs, an interior store design and an
exterior store design.
 Exterior and interior store design decisions are crucial to any retailer. A
retailer must take help of experts in store planning and building, architects,
lighting engineers, interior designers, and other specialists for such design
interventions.
 Exterior store design

 The issue of exterior store design arises when a retailer want to build a
new store or when a retailer wants to remodel an existing one.
 Cost is an important factor in this decision. Exterior store design
concerns with physical appearance of the store from the outside.
 Thus, it relates to the outside layout or look of the retail store. The
front of the store is more important.
Important aspects of Exterior design
 Important aspects constituting an external store design may include
(1) location of store site (2) clealiness, (3) attractive store frontage
(4) attractive and inviting entrance gate, (5) informative signs and
symbols, (6) convenient and safe parking facility, (7) eye-catching
window display, (8) glaring lighting, and (9) impressive, decorated
and multi-coloured building.

 In short, exterior store design covers all those things that determine an
outside appearance of the store. It must be attractive.
 Factors affecting Exterior design
 A retailer while deciding on exterior (or external) store design must
consider following factors :
 (1) Location of store (2) Type of display to be used (3) Statutory
provisions (4) Type of retail format/mode (5) Cost of land and
construction (6) Type of merchandise (7) Infrastructural facilities
available (8) General trend of buyers (9) Top management outlook
 Interior design of the store
 An internal design of retail store plays a crucial role for satisfying retail
customers.

 In-store design provides the shoppers an ideal shopping experience. The design
should be different, distinct, and attractive to catch the customer’s attention.
 Here, an important decision is to determine the furnished and non- furnished
areas. It shows the inside arrangement of the retail store. It involves space
planning, i.e., arrangement of merchandise, facilities, and staff at the right
places.

 In short, internal store design is subject to actual size of stores, the

merchandise sold within, and space used for the same, and overall layout of the
store.
 Important aspects of Interior design
 Normally, an interior design of big retail store shows (1) product wise
departments, (2) space for keeping customers’ belongings, (3) location
of products, ( furiture(including tables, racks, stands, shelves, etc.,
used to), (5) atmospherics aspects (lighting, colour, music and scent,
etc., used to influence customers emotional response), (6) flooring and
ceiling lightings and graphics, (7) signs and signals (to guide
customers), (8) deployment of staff, (9) location of trolleys and
baskets, (10) billing and cash counters, (11) refreshment facilities (like
rest space, drinking waters and urinals), (12) dressing or change room,
(13) and other facilities..
 Factors Affecting Interior Store Design :
 A retailer must consider relevant factors while deciding on interior
store design.
 Retail store design of a big shopping malls and departmental stores is quite-
different from the small retail store. Some factors may include the
followings :
 (1) Location of store (2) Requirement for selling and non-selling area. (3)
Special provision for self-service. (4) Type of instruments/tools to be kept.
(5) Type of display to be used and space requirement. (6) Type of
merchandise to sell. (7) Retail store format (8) Top management (9) Current
trend in retail store design (10) Shoppers’ expectations (11) Size/volume of
business (12) Other factors.

 Interior design should attract the customers
 It should help the customers to locate the products effortlessly.
 It should help the customers to spend longer time in the store.
 It should make customers to do impulsive purchase.
 It should influence the customers’ buying behaviour.
 Visual merchandise
 Visual Merchandising :
Don’t be confused with two terms
 (1) store design and (2) visual merchandising.
 Both are closely related but may be different. As
mentioned in the earlier portion, visual merchandising
relates to a systematic and attractive arrangement of
merchandise (i.e., different goods or commodities) in the
retail store, to attract shoppers and inspire them to buy. In
this sense, visual merchandising is an integral part of store
design, particularly the internal store design.
 In fact, everything inside and outside the store can be a source of
attraction, information, and encouragement to buy the product.
 In this sense, everything displayed along with the merchandise
in the store can be a part of visual merchandising.
 Purpose of retail store design is to attract customers, create
convenience to shop the products, and provide them pleasing
and memorable shopping experience.
 However, arrangement or display of products in the store seems
to be more important to attract, please, and motivate the
customers try and buy the products.
 Visual merchandising decisions depends on many factors.
 Visual merchandising refers to a proper presentation of merchandise .
 Visual merchandising an art and a science of displaying products
artistically, using various objects, colours, shapes, materials, designs,
and styles, to attract the customers.

 Visual merchandising is a process of an attractive presentation of a

store and its merchandise in a way that attract the attention of potential
customers.
 Primary purpose of visual merchandising is attract shoppers and
makes sales.
 Functions of visual Merchandise
 Attract regular traffic at the store.
 Create a positive climate for shopping.
 Educate the customer about products and services offered
in a creative and effective way.
 Enable successful selling process, from browsing to
buying.
 Draw the attention of the customer and help them match
their needs with visually merchandised products.
 Make shopping experience pleasurable and memorable one.
 Elements of Visual merchandise
 The primary purpose of store design is to sell merchandise.
 Many elements can be used by the visual merchandisers in
creating eye-catching displays.
 Visual merchandising is not confined to display of merchandise
only, but it includes all visual things that arouse buying interest in
the mind of the shoppers. It, normally, cover the followings :
 Visual display of major products.
 Colours, textures, and lighting.
 Window display
 Counter display
 Special offer counter/wing/rack.
 Signs and indicators of primary facilities, for example, washroom.
 Mannequins
 Big cut-outs of products and brand ambassador.
 Any other visual aspect that seems necessary to attract customers to store
and inspire to buy.
 All retailers do not follow the same pattern of visual merchandising, and do
not use all tools. Visual merchandising decisions depends on many factors,
like type of retail format, type ownership, type of merchandise, interior and
exterior store design, costs, type of shoppers, general trend in retail
business, and some other factors.
 Meaning of Brand
 Any aspects of branding if associated with retail business become retail
branding. Let us define definition of brand and branding.
 Philip Kotler : “A brand is a name, term, symbol, logo, design, or
combination of them which is intended to identify the goods or services of
one seller or group of sellers, and to differentiate them from those of the
competitors.”

 Finally, it can be defined as : The name, symbol, word, or picture given to

the product to distinguish it from other producers and/or sellers and to help
customers identify the product can be said as brand or branding.
 Concept of brand remains the same for manufactures, dealers or
retailers. Above definitions are equally applicable to retail brand too. A
process of deciding brand name is called branding.
 Retail Brand

 Brand decision in retail marketing is much complex due to

several ways to brand the product.
 Some retailers sell merchandise under manufacturer’s
name; company’s own retail outlet finds it convenient to
sell under its own brand;
 sometimes, retailer gives its brand name to product; and
some products like groceries are sold without any brand
name. retailer can sell popular bands without difficulty.
 Options for Retail Branding :
 Branding is a complex decision in retail business due to
several options. A retailer can sell the merchandise under following
brand options:
 (1) Manufacturer’s brand name
 (2) Retail chain brand
 (3) Non-branded products, without any brand

 A properly chosen brand name offers many benefits to the

retailer as well as the shoppers. The brand name should be properly
chosen and effectively communicated with the customers.
 Concept of ‘Private label’
 When the retailer decides to sell the product or line of merchandise,
under his own brand in his store that is called private label
merchandise.
 Private label is used for creating differentiation as retailing id highly
competitive industry.
 It gives competitive advantage to the retailer. Customer loyalty can be
won.
 A retailer can earn higher profit margin, Everything is controlled by
him so he can control the cost easily.
 He can easily promote is own brand or private label in his store.
 Examples of private labels
Retailer Brands Category/ies
Future group Tasty treat Jams, pickles, snacks.
Fresh and pure Tea, Butter, Ghree, cheese.
cleanmate Homecare, dishwashing products
Reliance Reliance select Staples like cereals and pulses
Reconnect Home appliances and Home
entertainment
Shopper’s stop Life, kashish, Clothing and accessories.
stop, haute curry
Flipkart Digiflip Laptop bags, Laptop skin,
camera bags.
 Function of branding
 Branding serves the buyers as under:
 Branding makes the choice of the product easy, as it can be
identified easily.
 Branding helps to saves time of customers in searching the
product.
 Brands helps to satisfy the desire of the customers.
 Brand create its own image and bring the bundle of expectations
like quality, quantity, Guarantee, resale price, after sales service.
 A brand not only satisfies the needs of the customers but also
adds to the identity and it adds status to the buyers.
 Branding serves sellers as under:
 Branding helps to reduce the efforts and cost on promotion of the
product by the buyers.
 The need for trained staff to promote the sales reduces, as branding
helps to make the sales easily.
 Branding creates the ground to skim the cream by the sellers by
introducing skimming price.
 A good branding creates the barriers for the potential competitors from
entering the market.
 Branding helps in increasing the firm’s image and market share also.
 Branding creates competitive edge for the sellers.
 Retail Price
 Retail pricing is one of the crucial decisions in retail
business.
 It has been noticed that most buyers decide to buy a
product based on its price.
 It is the most important factor that determines the buying
behavior on one hand and success of a product on the
other.
 Price is the amount of money that the goods or services are
sold for.
 Price is the value or worth of a product or a service.
 OBJECTIVES OF RETAIL PRICING
 As we have seen in earlier part that pricing is very crucial
decision taken by the retailer and thus, there are number of
objectives to be fulfilled, through correct pricing.
 Setting prices for products or services doesn’t simply come
down to a simple calculation.
 Price can be marketing tactics for communicating
something about the quality of offerings being made by
retailer to the customers.
 So, pricing decisions are based on the various objectives to
be achieved.
 Profit-Oriented Objective : All pricing is profit-oriented because, even if retailer set
prices with other objectives in mind, he still needs to earn a profit to stay in business and
survive.
 However, profit-oriented pricing always prioritize profit while setting the prices. A
profit-oriented pricing strategy looks for the price that allows retailer to charge as much
as possible for his offerings.
 He also takes care that the charging high does not let the potential customers go away to
the other brands. This type of pricing objective can either aim to maximize profit or
maximize overall profit by setting a competitive price.
 Sales Oriented Objective : It is the single most important objective of the any firm to
increase the sales volume of the firm.
 More the number of sales, more will be the returns in the form of profit. It is obvious
that sales growth has a direct impact on the profits.
 The retailer sets the prices in such a way that sales of the firm can be increased. Again
the pricing decisions are taken in a way that the target market share of the firm can be
achieved and maintained. Thus, retailer has his eyes on the market and manipulates its
pricing whenever called for.
 Customer Oriented Objective : It is the prime objective of any firm
to satisfy its customers through justified pricing policies.
 Customers are considered to be the kings and they are offered what
they want and at the price they are willing to buy.
 Retailer always aims to have customer satisfaction, by offering them
the products at reasonable prices. Also, firm sets its pricing policies
with the objective of gaining the customers’ confidence.
 This is important to make them realize that the prices charged are
worth the attributes of the product offered and they are not being
cheated in any ways.
Factors Influencing Retail pricing
 The Predetermined Objectives : The pricing of the retailer’s product
highly depends upon the predefined motives of the firm.
 As objectives may vary according to the changing time and market
situations. For e.g. if the prime objective of the retail firm is to increase
return on investment, then the company may charge a higher price of the
their products and if the objective is to increase market share, then it may
charge a lower price to penetrate the market and then grab the share of
profit.
 Image of the Firm : The retailer firm may consider its own image in the
market. If the store is well established and holds a good brand image,
there are all chances that it may demand a higher price for its product
while the newly established store may have to consider other relative
factors while setting the price rather than the image of the firm, as it is yet
to be established.
 Promotional Activity : It is the promotional activities of the
retail firm which is often costing higher and carries lot of
expenses.
 Any expenses are to be recovered through its pricing only.
Thus, it is the promotional expenses volume that decides the
pricing standard of the product or services.
 If the company is spending high cost on advertising and
sales promotion, then it keeps product price high in order to
recover the cost of promotion etc.
 Again price is the single most important factor to cover the
overall expenditure.
 External factors
 Competition : Competition can be considered as one of the most influential
external factors while deciding the retail price. Depending upon the
competitive environment existing in market the price of the merchandise is
often set, also the price of the competitors is also to be considered.
 For e.g. in the case of high competition, the prices may be set low to face
the competition effectively, and vice-versa.
 Buying behavioral pattern : There has to be a proper study of the buying
attitude and behavior of the prospective buyers.
 Retailer should have complete analysis of buyer’s behavior only then the
correct pricing can be set.
 This is a must as while setting the price, attitude of the price sensitive
customers, their buying power should counted as it affects a lot to the
pricing decisions.
 Government Policies : Government policies and its rule directly affect the
functioning of the retail firm. It is very important for the retailers to set the
prices within the limits of the legal framework.
 Thus, one must have complete knowledge about the government’s rules and
policies prevailing for the concerned products while setting prices.
 Demand of the product : The demand of the product is the single most
important factor affecting the price of the products. Retailers must set the
price of the product according to the demand for the same.
 There is a kind of strong relationship between the demand and price, like
price is kept high when demand is high, and price is reduced when demand
for product falls. Both these effects can be used, while pricing a product. This
is important as the ultimate goal of the producer is to earn the profit by
creating the demand.
 Economic situation : The overall condition of the economy is
definitely a determining external factor to be considered while
deciding the price of the product.
 It means it is to be studied that what type of economic conditions are
prevailing that is whether there is inflationary or deflationary trend, or
economy is under recovery or prosperity conditions.
 This has direct impact on the price of the product. Thus, overall health
of the economy should be considered while setting the prices of the
product by retailer.
 Retail pricing strategies
 Markup Pricing : This is the most common method of pricing a
product.
 Markup pricing or cost-plus pricing is a pricing strategy where
the price of a product or service is calculated by adding together
the cost of the products and a percentage of (profit) as a markup.
 The percentage or markup is decided by the company or retailer.
 It is usually fixed after calculating the expectation of the required
rate of return by the retailer. Markup pricing should be high
enough to allow any price reductions and discounts, other
anticipated expenses that may occur.
 Going rate pricing : This method is generally followed by
the small firms where the firms do not give enough
attention to its own costs, product or objectives.
 Here there is consideration of the competitors pricing
which is taken as base for setting its own pricing.
 A price that is same, slightly higher or lower may be set so
as to be in the competition and thus, it is often termed as
competition oriented pricing. Here the idea is “follow the
leader”.
 Perceived value pricing :- The pricing of the product under this
strategy set, after considering the consumer’s perceived value for the
product.
 It means how much a customer is ready to pay for the product. In this
strategy the consumer’s perception towards the product and what
worth they are ready to pay for product is in priority rather than the
cost involved, objective set or product’s attribute.
 This is also referred to as market oriented pricing. The customers are
informed about features, brand, reputation, after sales services or any
other aspect of the product and then are asked to estimate the price of
product.
 Break Even analysis pricing : Under this type of pricing method the
firm tries to evaluate the break-even point.
 This is arrived at after establishing the relationship between the costs,
sales volume and profit.
 The charts, tables and graphs may be used to arrive at the break-even
point.
 This break-even point is the point at which company is earning no
profit or incurring any loss. Here there is equality in the total revenues
and total cost incurred.
 When the firm’s sales revenue exceeds the total cost it is profit. And
when sales revenue is less than cost is incurs loss.
 Target returns pricing : In this method the firm decides
that level of pricing through which the targeted return can
be achieved on the investment.
 Here through this pricing there is a constant effort of the
firm to recover the cost of investment.
 It is cost oriented pricing policy. Of course, this method
can only be used if the firm is able to estimate the costs as
well as sales. This method is used generally by the market
leader.
 Customer services
 The customers expect many services from the retailer when
they visit the retail store for shopping or when they buy online.
 Type of services depends on type of retail format. Retailers conduct
retail business operations in several formats, like small convenience
stores, departmental stores, supermarkets, hypermarkets, highway
retailing, shopping malls, retail chains, and non-store retail business,
service retailing, etc.
 Organised retailing and unorganised retailing differ significantly in
term of the customer service.
 Supermarkets that sell FMCG and sells groceries require little in-store
services while specialty stores that sell expensive jewelries, fashion
apparel, furniture, expensive personal accessories, footwear, etc., have
to provide many type of services to satisfy the shoppers.
 Offline and online retailers follow different patterns to serve
customers better. However, store-based (or offline) retailers are more
actively involved in consumer service.
 Type of Services before the Customers enter retail store
: Before the customer visit the store and enter inside the retails store
for purchasing the products, a retailer should focus on some common
customer services.
 Such services may include convenient and safe pathway to reach the
store, comfortable staircase, escalator, clealiness, safe parking facility,
clear sign and indicator showing frontage and entrance of the store,
proper safety and security measures nearby area, facilities for
handicapped and senior customers, and other facilities the shoppers
normally expect from the retailer.
 These services are provided when the customer visit the retail store:
 A.Front end service:-
 When a customer walks into a retail store, he examines the merchandise, he
checks the price list, he tests and tries the product, he compares the products
and offers associated with the products, he talks to sales persons and resolves
his queries, and makes buying decisions.
 Some of the front-end services may include (welcoming the customers, (2)
skillfully attending the customers, (3) performing product demonstration and
trial, (4) extending support for (digital and physical) payment of bills and
exchanging products, (5) providing information and attending queries, (6)
managing proper change room (in case of apparels), (7) providing carrying
carts and buckets, (8) maintaining sings and indictors of products categories
(9) supplying information regarding special offers, and (10) ensuring easy
access to touch and check the products.
 B. In-store ambience : Shoppers spend more or less time in the store.
 But, they expect pleasing atmosphere at the store. Similar, in-store
atmosphere must be comfortable to the shoppers. Comfortable and
pleasing environment offer many competitive advantages.
 In-store ambience may include (1) sufficient space to move
comfortably, (2) proper furniture and fixtures, (3) attractive lightings
and decoration, (4) systematic arrangement of merchandise, (5)
melodious light music and delighting scent, and (6) overall ambience
can make a big difference in creating the total shopping experience
and pleasing the customers. The climate within the store must be
comfortable and pleasurable.
 After Sales Services : Once the customer leaves the retail store after
shopping, he expects certain services from the retailer.
 Such services may include home delivery, credit and installment
facilities, exchange offer, fulfilment of guarantee and warrantee,
hassle-free change and replacement of products, free installation (in
case of home appliances), counselling and expert advice and any other
service the customers expect the retailer should offer.
 Retail market promotion
 Communication is one of basic issues in retail marketing.
 Communication is a tool to inform, to convince, and to remind the
consumers.
 It can also contribute to relation building.
 Retail market promotion and retail market communication are
closely associated terms and can be used interchangeably.
 A retail market communication mainly contains the retailer’s all type
of conscious and deliberates promotional efforts to increase customer
traffic and thereby to increase sales.
 A retailer communicates with the target buyers and to inform,
persuade, and remind them regarding the retail store and its offers.
 DEFINITIONS
 “Retail communication refers to the retailer’s communication efforts with his
customers through various vehicles, like advertising, personal selling, sales,
promotion, publicity, word of mouth communication, Retail communication
is a multipurpose activity.”

 “Market promotion efforts undertaken by the retailer to promote retail

business activities can be said to be retail market communication.”

 Retail market communication involves (1) providing necessary information

to the retail customers, (2) persuading and inspiring them to try and buy
merchandise from the retail store (3) reminding the customers about retail
store and it services, and (4) building a long-term profitable relations with
the valued customers.
 Tools of retail market communication
 Assessing internal and external situation, the retailer should formulate the right
promotion mix.
 Retailers communicate with the customers about their products or services, new
product updates, and upcoming events regarding retail business via several media
(also called channels or tools). As per need, time to time, necessary changes are
made to suit with changing situations :
 Retailer can use various channels or tools for market promotion, such
as :
 Advertising (including direct marketing) via different media.
 Personal Selling
 Sales Promotion
 Publicity and Public Relations (including word-of-mouth publicity)
 In-store atmosphere
 Objectives of Retail market Communication
 All retailers are aware of the need to promote their stores and merchandise
they sell. Large retailers spend heavily in mass media and other type of media.
Market promotion is one of the most important decisions in retail business.
Market promotion (or communication) in retail business is a multipurpose
tool. It aims at the followings:
 Inform the customers about the store.
 Inform customers about the merchandise and services available.
 Attract the consumers to store.
 Encourage or inspire the consumers to try and buy the products.
 Develop a band (or group) of loyal customers.
 Remind the retail buyers regarding the retail store and its services.
Important Decisions in Retail Market Promotion
Mix :

 A retailer who is planning to undertake retail market promotion efforts should

focus on several decisions. These decisions may be referred as stages of retail market
promotion (communication. Practically, a retailer’s market promotion (communication)
contains followings decisions :
 Determine objectives of retail market promotion.
 Retail market promotion budget.
 Assign retail market promotion responsibility.
 Prepare promotional message to communicate with the customers.
 Select suitable promotion tools-from among advertising, personal selling, sales
promotion, publicity and public relations.
 Specific media vehicles for selected promotion tools, to transmit the promotional
message.
 Retail market promotion schedule.
 Measure effectiveness of promotional efforts.
 Factors affecting retail market promotion mix
 Retail market promotion mix refers to several decisions relating to retail
communication efforts. Retailers differ significantly in executing retail market
promotion mix due to many factors. Some of dominant factors are listed below :
 Retail market promotion objectives
 Type of retail format and ownership
 Size of business
 Type of merchandise
 Cost of promotion tools and the media vehicles
 Location of store
 Retail consumer behaviour
 Degree of competition
 Retailer’s image and reputation