Transcription
\ I g\ I L- I I NTENTH EDITIONMANAGEMENTMichael Levy, PhDBabson CollegeBarton A. Weitz, PhDUniversity of FloridaDhruv Grewal, PhDBabson CollegeMeGrawHillEducation
BRIEF CONTENTSSECTION 1THE WORLD OF RETAILING1Introduction to the World of Retailing2Types of Retailers3Multichannel and Omnichannel Retailing4Customer Buying BehaviorSECTION II306684RETAILING STRATEGY5Retail Market Strategy6Financial Strategy7Retail Locations8Retail Site Location9Information Systems and Supply Chain Management120154176200Customer Relationship Management10SECTION III250MERCHANDISE MANAGEMENT11Managing the Merchandise Planning Process12Buying Merchandise13Retail Pricing14Retail Communication MixSECTION IV272312340366HUMAN RESOURCES AND STORE MANAGEMENT15Human Resources and Managing the Store16Store Layout, Design, and Visual Merchandising17Customer ServiceSECTION 26
CHAPTER 3MULTICHANNEL ANDOMNICHANNEL RETAILINGRelative Strengths of Retail ChannelsIn-Store Retailing68Internet Retailing70Mobile Retailing66Challenges Facing Multichannel and OmnichannelRetailers 78Multichannel and Omnichannel Supply Chains andInformation Systems 7868Consistent Brand Image across ChannelsMerchandise Assortment72PricingRetailing View 3.1: Ensuring Mobile Dominance throughIn-Store Promotions 73Social Retailing80Reduction of Channel Migration80Retailing View 3.4: Warby Parker, the ReverseOmnichannel Retailer 8074Catalog and Other Nonstore Channels797974SummaryRetailing View 3.2: Avon’s Direct Selling Channel inBrazil 75Key Terms8182Opportunities Facing Multichannel and OmnichannelRetailers 76Get Out and Do It!Retailing View 3.3: Apple, the Gold Standard ofOmnichannel 77Chapter EndnotesCHAPTER 4Retailing View 4.2: Pinning Consumption Choices onOnline Reference Groups 101CUSTOMER BUYINGBEHAVIOR 84The Buying ProcessNeed RecognitionInformation Search82Discussion Questions and Problems83Reference Groups85Culture868982102102Market Segmentation103Retailing View 4.1: The Supermarket That GetsCustomers, and Also Gets Them to Stay 91Retailing View 4.3: No More Smokes at CVSEvaluation of Alternatives: The MultiattributeModel 92Approaches for Segmenting Markets '105Purchasing the Merchandise or Sen/icePostpurchase EvaluationComposite Segmentation Approaches97Extended Problem SolvingLimited Problem SolvingSummary97Key Terms98Habitual Decision Making99FamilyCHAPTER 599Chapter Endnotes112115RETAILING STRATEGYRETAIL MARKETSTRATEGY 120What Is a Retail Strategy?Retailing View 5.1: The Meaning of Best Value: WholeFoods’s Purpose-Based Marketing 131Growth Strategies121Definition of Retail Market StrategyTarget Market and Retail Format123Relationships with Customers—Customer Loyalty129Efficiency of Internal Operations129130Multiple Sources of Advantage132Retailing View 5.2: Starbucks’s Expansionin Italy 134122Building a Sustainable Competitive AdvantageRelationships with Suppliers131Growth Opportunities121Central Concepts in a Retail Market StrategyLocation111Appendix 4A: Customer Buying Behavior andFashion 113100SECTION II111Discussion Questions and Problems99110111Get Out and Do It!Social Factors Influencing the Buying Process103104Retailing View 4.4: Fashioning an EffectiveSegmentation Strategy 1069697Types of Buying DecisionsThe EconomyCriteria for Evaluating Market Segments124125Growth Opportunities and CompetitiveAdvantage 135Global Growth Opportunities135Retailing View 5.3: Uniqlo: The Brand withoutBorders 136Attractiveness of International Markets130Keys to Success in Global Retailing139136
Step 6: Develop a Retail Mix to Implement theStrategy 149Retailing View 5.4:7-Eleven Is Trendy Hangout inIndonesia 141Entry Strategies142The Strategic Retail Planning Process142Step 1: Define the Business Mission143Step 2: Conduct a SWOT AnalysisStep 7: Evaluate Performance and MakeAdjustments 149Strategic Planning in the Real WorldpNummary144Step 3: Identify Strategic Opportunities148 Step 4: Evaluate Strategic Opportunities148Key TermsCHAPTER 6Chapter Endnotes168169Using the Strategic Profit Model to Analyze OtherDecisions 170157Strategic Profit Model168Asset Turnover Management Path156Personal Objectives151151Profit Margin Management PathRetailing View 6.1: One for One to Achieve TOMSShoes’s Societal Objectives 156Societal Objectives151Evaluating Growth Opportunities154155Financial Objectives150Discussion Questions and ProblemsFINANCIAL STRATEGYObjectives and Goals149Get Out and Do It!Step 5: Establish Specific Objectives andAllocate Resources 149149vSetting and Measuring PerformanceObjectives 171157157Retailing View 6.2: Nordstrom and Walmart: SuccessfulRetailers Using Different Retail Strategies 159Profit Margin Management PathTop-Down versus Bottom-Up Process171Who Is Accountable for Performance?171Performance Objectives and MeasuresTypes of Measures160172172Assessing Performance: The Role of BenchmarksRetailing View 6.3: Calculating the Costs and Profits ofOnline Channels 161Asset Turnover Management PathChapter EndnotesImplications for Improving Financial PerformanceRETAIL LOCATIONSUnplanned Locations178Freestanding Sites178Urban LocationsMain Street182183Merchandise Kiosks192Density of Target MarketUrban Sprawl184192194Zoning194Summary187Key Terms189Larger, Multiformat DevelopmentsRetailing View 7.3: Subway Goes to Church190195196197198Discussion Questions and ProblemsChapter Endnotes189-197Get Out and Do It!188194.195Building CodesRetailing View 7.2: For China’s High-End FashionConsumers, “Italy” Is Now Just a Bullet Train Away195Opposition to Big-Box Retailers187190Shopping Behavior of Consumers in Retailer's TargetMarket 192Societal and Legal Considerations186Theme/Festival Centers191Uniqueness of Retail OfferingRetailing View 7.1: How Apple Stores Transformthe Mall Equation 185Outlet CentersStore-within-a-StoreLocation and Retail StrategyConvenience, Neighborhood, and CommunityShopping Centers 183Mixed-Use Developments190 .Pop-Up Stores and Other Temporary Locations181Lifestyle Centers175175Nontraditional Locations176179Enclosed Shopping Malls175167178Shopping Centers and Planned Retail LocationsPower Centers174Discussion Questions and ProblemsCombining the Profit Margin and Asset TurnoverManagement Paths 167Types of Retail Locations174Get Out and Do It!Retailing View 6.4: Basing Inventory Levels onCrowdfunding Campaigns 165CHAPTER 7SummaryKey Terms163173198198
CHAPTER 8RETAIL SITE LOCATION200Evaluating Areas for Locations and Determining theNumber of Stores in an Area 201Metropolitan Statistical Area202Considerations in Evaluating Store Locations202Retailing View 8.1: Big Payoff from Small TownsNumber of Stores in an AreaEvaluating Specific SitesSite Characteristics203206212Measuring the Trade Area for a Retail Site212Sources of Information about Trade Areas213Retailing View 8.3: How Lululemon’s Flagship StoreSummarizes Its Location Strategy 215Competition in the Trade AreaINFORMATION SYSTEMSAND SUPPLY CHAINMANAGEMENT 226Retailing View 9.1: Kroger’s Communications withSuppliers Benefits Customers 229230Improved Product Availability230231221221222223224Get Out and Do It!224Discussion Questions and ProblemsChapter EndnotesRetailing View 9.2: The IKEA WayThe Distribution (or Fulfillment) CenterSystem Design Issues and Trends237Pull and Push Supply Chains241242Radio Frequency identification Devices242244Reverse LogisticsSummaryKey Terms245245247247247Chapter Endnotes248248Developing CRM through Frequent-ShopperPrograms 259Effectiveness of Frequent-ShopperPrograms 259252252253253Making Frequent-Shopper Programs MoreEffective 259Retailing View 10.2: Whole Foods’s Loyalty ProgramGoes Beyond Other Grocers’ 260254Privacy and CRM Programs241Outsourcing Supply Chain FunctionsDiscussion Questions and ProblemsCUSTOMER RELATIONSHIPMANAGEMENT 250Collecting Customer Shopping Data239Inventory Management through Just-in-TimeInventory Systems 240Get Out and Do It!Distribution Centers versus Direct StoreDelivery 235Overview of the CRM Process224225Customer Store PickupThe Flow of Merchandise through a SupplyChain 235255Analyzing Customer Data and Identifying TargetCustomers 256Identifying the Best CustomersRetail Analytics220Retailing View 9.3: A Robotic Supply Chain, All the Wayfrom the Warehouse to Customers’ Doors 244233Identifying InformationKey TermsDrop ShippingVendor-Managed Inventory and CollaborativePlanning, Forecasting, and Replenishment 234Data Warehouse219Supply Chain for Fulfilling Catalog and InternetOrders 243The Flow of Information through a SupplyChain 232 -The CRM Process218217Creating Strategic Advantage through Supply ChainManagement and Information Systems 228CHAPTER 10Negotiating a LeaseSummaryFactors Affecting the Size of the Trade AreaData WarehouseStep 1: Conduct Competitive AnalysisTerms of the Lease210Higher Return on AssetsIllustration of Site Selection: Edward Beiner Purveyorof Fine Eyewear 218Types of Leases209210Strategic Advantage2'18Step 4: Match Characteristics of Present Trade Areawith Potential Sites 221Locations within a Shopping CenterCHAPTER 9Analog Approach217217Step 3: Identify Trade Area Characteristics206Trade Area DefinitionRegression AnalysisStep 2: Define Present Trade Area204Retailing View 8.2: It Pays to Locate on the Right Sideof the Road 207Defining Trade AreasEstimating Potential Sales for a Store Site256257Retailing View 10.1: How CVS Uses Loyalty Data toDefine Coupons 257Retailing View 10.3: InCircle Builds Neiman Marcus’sShare of Wallet 261Implementing CRM ProgramsCustomer PyramidCustomer Retention262263262
Retailing View 10.4: Staples’s App-Based SmallBusiness Community 265SummaryKey TermsCustomer Conversion: Making Good CustomersBest Customers 265Dealing with Unprofitable Customers266267Get Out and Do It!266Chapter EndnotesSECTION IIICHAPTER 11268268MERCHANDISE MANAGEMENTMANAGING THE MERCHANDISEPLANNING PROCESS 272Merchandise Management OverviewThe Buying Organization275Control System for Managing Inventory of FashionMerchandise 296276Evaluating Merchandise ManagementPerformance 277Improving GMROIAllocating Merchandise to Stores297Amount of Merchandise Allocated279Type of Merchandise AllocatedRetailing View 11.1: How Macy’s Manages ItsMerchandise 280Merchandise Planning ProcessesAnalyzing Merchandise Management Performance283Evaluating the Assortment Plan Using ABCAnalysis 301284Retailing View 11.3: Weather’s Effects on RetailSales 285Forecasting Fashion Merchandise CategoriesSales Forecasting for Service RetailersSummary . 303285Key Terms304Get Out and Do It!287304Discussion Questions and ProblemsDeveloping an Assortment Plan288Category Variety and Assortment288Setting Inventory and Product Availability LevelsModel Stock PlanBUYING MERCHANDISE314National Brands314310312Retailing View 12.2: The Search for Cheaper GarmentFactories Leads to Africa 321Negotiating with VendorsKnowledge Is Power315Generic BrandsChapter Endnotes291Brand AlternativesStore Brands290290Product AvailabilityCHAPTER 12305Appendix 11A Merchandise Budget Report andOpen-to-Buy System for a Fashion MerchandiseCategory 306288Determining Variety and Assortment300Evaluating the Merchandise Plan Using Sell-ThroughAnalysis 300284Forecasting Staple Merchandise298Retailing View 11.4: Customer-Centric MerchandiseAllocation at Saks Fifth Avenue 299281Retailing View 11.2: Fast Fashion at Mango297297Timing of Merchandise AllocationTypes of Merchandise Management PlanningSystems 282Forecasting Category SalesEstablishing a Control System for ManagingInventory 292Control System for Managing Inventory of StapleMerchandise 292275Merchandise Category—The Planning Unit 267Discussion Questions and ProblemsNegotiation Issues316National Brands or Store Brands?316323323324Tips for Effective Negotiating326Retailing View 12.1: Kroger’s Store Brands HaveIt All 317Strategic RelationshipsBuying National-Brand MerchandiseRetailing View 12.3: Zappos Values Relationships withIts Vendors, the Merchandise Experts 329Meeting National-Brand VendorsNational-Brand Buying Process318318Maintaining Strategic Relationships329330Retailing View 12.4: It Isn’t Easy to Sell toWalmart 330320Sourcing Store-Brand Merchandise327Building Partnering Relationships320Developing and Sourcing Store-BrandMerchandise 320Developing Store Brands327Defining Strategic Relationships320
Legal, Ethical, and Social Responsibility Issues forBuying Merchandise 331Legal and Ethical Issues337Discussion Questions and Problems335Chapter Endnotes337337336CHAPTER 13RETAIL PRICINGPricing Strategies342High/Low Pricing340Coupons342Zone PricingAdvantages of the Pricing Strategies344358358Leader Pricing344359Price Lining359Odd Pricing359NLegal and Ethical Pricing IssuesCustomer Price Sensitivity344Deceptive Reference PricesPredatory PricingRetailing View 13.2: The Increasing Costs of Play:New Offers and Pricing by Disney and UniversalTheme Parks 347Competition358Quantity DiscountsRetailing View 13.1: Walmart Offers Low-PricedOrganic Foods 343Setting Retail Prices358Price Bundling342Everyday Low Pricing360360360Resale Price Maintenance360Retailing View 13.4: What Makes a PriceRegular? 361347Pricing of Services347Using Analytical Tools to Set PricesMarkdowns336Get Out and Do It!331Corporate Social ResponsibilitySummaryKey Terms348353Horizontal Price Fixing361Bait-and-Switch Tactics361SummaryReasons for Taking Markdowns353Key TermsPricing Techniques for Increasing Sales and ProfitsDynamic Pricing356356Promotional Markdowns362362Get Out and Do It!363Discussion Questions and Problems356Chapter Endnotes363364Retailing View 13.3: Changing Once, Changing Twice,Changing 3 Million Times: How Amazon Prices toWin 357Clearance Markdowns for FashionMerchandise 358CHAPTER 14RETAIL COMMUNICATIONMIX 366New Media ElementsOnline Media368368Retailing View 14.1: Getting Shoppers to Stop at theSite, Even If Just for a Quick Read 370Retailing View 14.2: Analyzing the Unmeasured: ASnapchat Experiment by Domino’s to Test theChannel’s Effectiveness 371Social Media372Establish ObjectivesTraditional Media ElementsMass Media Advertising373Determine the Communication BudgetAllocate the Promotional BudgetRetailing View 14.4: Does the Future of CouponingLook Different Than Its Past? 378Personal Selling380Public Relations380378V385388393393Chapter Endnotes377In-Store Marketing/Design ElementsKey Terms394Discussion Questions and Problems375382Plan, Implement, and Evaluate CommunicationPrograms—Three Illustrations 389Get Out and Do It!374382Retailing View 14.5: Retailing Communicationsand Communicaciones Venta al PorMenor 383SummaryRetailing View 14.3: YouTube and HSNSales PromotionsPlanning the Retail Communication Program394394
SECTION IVHUMAN RESOURCES AND STORE MANAGEMENTCHAPTER 15HUMAN RESOURCES ANDMANAGING THE STORE 398Acquire and Retain Human ResourcesRecruit Retail EmployeesInventory Shrinkage400400415The Organization Structure for a Retail FirmRetailing View 15.1: How Can Retailers Best RecruitMillennial Employees? 401Train and Acculturate EmployeesMotivate EmployeesRetailing View 15.4: Can Retailers Call on EmployeesAnytime? Should They? 415403416Organization of a National Retail Chain418Human Resource Management Legal Issues405Equal Employment OpportunityRetailing View 15.2: Motivated by Ownership atPublix 406CompensationRetailing View 15.3: Dressing Employees for RetailSuccess 407Employee Safety and HealthEvaluate Employees407Labor RelationsControlling Costs414STORE LAYOUT, DESIGN, ANDVISUAL MERCHANDISING 426427Visual Merchandising428Control Costs to Increase ProfitsFixtures430431Store Design ElementsColor452452SummaryRetailing View 16.2: Finding Ways to GetModern Shoppers to Buy Candy, Gum, andMagazines 439Key TermsChapter Endnotes462Standardized Service463Customer Evaluations of Service QualityPerceived Service464Role of Expectations455456Discussion Questions and Problems460Balancing Customer Service: Personalization versusStandardization 462454455Get Out and Do It!440453453Just How Exciting Should a Store Be?435CUSTOMER SERVICE451452MusicTastePersonalized Service449452Scent437CHAPTER 17448Retailing View 16.3: The Primary Colors of Scents432432Signage and Graphics443447Creating an Appealing Store AtmosphereLighting442448Presentation TechniquesMeet Legal Considerations—Americans withDisabilities Act 430Store Exteriors442Space Allocated to Merchandise CategoriesDetermining Store SizeRetailing View 16.1: Saks: LuxuryShopping as Both Functional andExperiential 429Design Trade-OffsSpace ManagementLocation of Merchandise Categories427427Increase Sales on VisitsFeature Areas423424413Implement the Retail StrategyLayouts423Discussion Questions and ProblemsChapter EndnotesStore Design ObjectivesBuild Loyalty423Get Out and Do It!413Store MaintenanceCHAPTER 13412413Labor Scheduling422422Key TermsMaintaining Morale421421410412Leader Decision-Making Style421Sexual HarassmentSummaryLeadership420420421Employee PrivacyReward and Compensate Employees416Organization of a Single-Store Retailer456457Retailing View 17.1: How Appealing to Women HasHelped Home Depot 467The Gaps Model for Improving Retail CustomerService Quality 468Knowing What Customers Want: The KnowledgeGap 468464Setting Service Standards: The StandardsGap 470466XXV
Retailing View 17.2: Using Analytics to Reduce WaitTime at Kroger 472Meeting and Exceeding Service Standards: TheDelivery Gap 472Service Recovery477Listening to Customers477Providing a Fair Solution477Resolving Problems QuicklyRetailing View 17.3: Service-Providing RetailRobots 475SummaryKey TermsCommunicating the Service Promise: TheCommunication Gap 476478478478Get Out and Do It!479Discussion Questions and ProblemsChapter EndnotesSECTION V2. Find “Good Stuff Cheap” at Ollie’s BargainOutlet 4853. Tractor Supply Company Targets the Part-TimeRancher 4864. Build-A-Bear Workshop: Where Best FriendsAre Made 4875. Blue Tomato: Internationalization of aMultichannel Retailer 4886. Staples, Inc.8. Ashley StewartParisian Patisserie “Maison Laduree” GoesGlobal 49925. Kroger and Fred Meyer: Sourcing Products in aGlobal Marketplace 51852252430. Target Marketing with Google AdWords31. Diamond in the Rough52632. A Stockout at Discmart52652434. Zipcar: Delivering Only as Much Driving asYou Want 52850135. A Musical Quandary in an Italian Restaurant50336. Yankee Candle: Product Management andInnovation 53015. Tiffany and TJX: Comparing FinancialPerformance 50518. Avon Embraces Diversity51651733. Customer Service and Relationship Managementat Nordstrom 52712. Retailing in India: The Impact ofHypermarkets 500Hutch: Locating a New Store23. Developing an Assortment Plan for Hughes24. Preparing a Merchandise Budget Plan29. Promoting a Sale10. Home Depot: Opportunities and Challengesin China 49616. Choosing a Store Location for a Boutique22. Mel’s Department Store under NewManagement 51527. How Much for a Good Smell?9. The Decision-Making Process for Buying aBicycle 49514. Starbucks’s Expansion into China51421. Active Endeavors Analyzes Its CustomerDatabase 51528. See It! Scan It! Buy It! Shortening the Path toPurchase with Mobilibuy’s Technology 52249313. Diamonds from Mine to Market20. Attracting Generation Y to a Retail Career26. American Furniture Warehouse SourcesGlobally 5204907. Remixing a Green Business: The GreenPainter 49117.480CASES1. Making Macy’s Meaningful: Moves by the RetailChain to Maintain Its Competitiveness 48411.47950650751219. Sephora Loyalty Programs: A Comparisonbetween France and the United States 51237. Interviewing for a Management TrainingPosition 531Glossary 535Index 550530
Retailing View 5.2: Starbucks's Expansion in Italy 134 Growth Opportunities and Competitive Advantage 135 Global Growth Opportunities 135 Retailing View 5.3: Uniqlo: The Brand without . The CRM Process 252 Overview of the CRM Process 252 Collecting Customer Shopping Data 253 Data Warehouse 253 Identifying Information 254
