• Microsoft PowerPoint - Retail Strategic Planning-3

What is the Retailing Concept?
Customer Orientation
Strategic Planning
Value-driven
Coordinated Effort
Goal-Oriented
Relationship Retailing Retail Value Chain
Seek long-term relationships with customers Bundle of benefits retailers provide to
rather than viewing each sale as a new consumers
encounter Ambience
Focus on customer satisfaction over time Quality of products
Satisfaction happens when a retailer meets or Brands offered
exceeds customer expectations
Discounts/good prices
Are all customers equal? Are some worth
Shipping
more to a retailer than others?
Convenient Location
“Core Customers”
Service
How is Strategic Planning
done?
What are your favorite places to shop Situational Analysis
Opportunities, threats, mission
or visit?
Set Objectives
What value do you get from them? Sales, profits, image/positioning
Identify Target Market
Mass marketing vs Concentrated vs Differentiated
Aggregation vs Segmentation
Strategic Planning Strategic Planning
Develop Broad Strategy Identify Specific Tactics
Who is the competition? (Intratype vs Intertype)
What will be your sustainable competitive
advantage? Control Process/ Retail Audit System
Which of the following are sustainable? Strategies and tactics are evaluated and revised
Price
Location Feedback
Vendor relations Look at performance measures like turnover,
MIS-technology sales, and profits
Low cost operations
How can you grow your
business? Growing the Business
Market Penetration
Present customers, same segment Retail Format Development
New format to existing customers
Market Expansion
Existing format to new customers (new
geographic area or demographic group) Diversification
New format to new segments
Institutional Change in Retailing Wheel of Retailing
Wheel of Retailing
Accordian Theory
Dialectic Process
Natural Selection
Retail Life Cycle
Wheel of Retailing Retail Accordian Theory
New types of retailers enter a market as low-
margin, low-price, low status merchants
Broad-based outlets with wide assortment
They gradually trade up which increases their ↓
operating costs More specialized with narrow
assortment
The become high cost merchants and
become vulnerable to newer competitors ↓
Back to wide assortment
Dialectic Process Dialectic Process
Retailers mutually adapt in the face of
competition from “opposites”
When challenged by a competitor with a
differential advantage, the established retailer
will adopt strategies and tactics in the
direction of that advantage (making the
innovator less attractive)
Natural Selection and Adaptive
Behavior Retail Life Cycle
Introduction
Environmental need for a certain kind of retailing Growth/ Accelerated Development
institution → it will evolve Maturity
Remodel stores
Lower costs
Need ceases to exist → the institution will tend to
disappear MIS – technology
Every day low prices
Reevaluate mgt. practices and service
Institutions that most effectively adapt to
Figure out how they can deliver value
environmental changes are most likely to survive
Decline