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Summer 2012
Master of Business Administration - MBA Semester 3
MK0012– Retail Marketing - 4 Credits
Book ID: B1222
Assignment Set- 1 (60 Marks)
Note: Each question
carries 10 Marks. Answer all the questions.
Q.1 How has the
growth of retail sector helped the Indian economy?
Answer :
Contribution of Retail:
What, How and For Whom The presence of retail sector in
India has been in limelight for the last few years. Its significance has been
undoubted. Policymakers are quite optimistic that the evolution and steady
maturation of organized retailing will take the economy to new highs. Besides,
it will also help strengthen the linkages between the different sectors so as
to break the vicious circle of poverty and ensure a bright future for the next
generation. The benefit of retailing to general public includes growing
awareness and brand consciousness.
Indian Retail: Past
Vs Present
It is widely accepted that the retail industry has undergone
a drastic change in last five years and there is yet more to come. Let us
compare the image of Indian retailing in 2004-05 to that of its status in
2007-08 in the following table:
Magnification of the
Indian Retail Industry
Yardstick
Situation in 04-05
Situation in 07-08
Value of retail sales
Rs. 10,20,000 crore
Rs 12,00,000 crore
Annual growth rate
5%
5.7%
Value of organized
market
Rs 35,000 crore
Rs 55,000 crore
Share of organized
market in the sector
3.4%
4.6%
Forecasts (after 5
years) about size of organized retail market
Over Rs. 1,00,000
crore
Rs. 2,00,000 crore
Forecasts about
growth rate of organized retail market
Around 30%
Around 40%
The above table clearly shows that the retail market as well
as the mindset required for it has experienced a thorough revisal in the last
three years. This is just the beginning and Indians are sanguine that the
sector will see rosy days in the future. This confidence has helped India
acquire the No.1 position among 30 most attractive retailing destinations in
the world according to the Global Retail Development Index of 2005 (by AT
Kearney, India). Among emerging markets, India holds the second position after
China in the list of most favoured retail destinations.
The retail industry employs a huge share of the total
workforce in India. It is the second largest employer after India. Presently 7
percent of the total labour force is employed in the retail sector. According
to available data it is also the largest employer in the services sector and
maximum growth in the non-agricultural sector has been witnessed by retail
trade. According to market analysts 300 new malls, 1,500 supermarkets and 325
departmental stores are going to come up in India in the next few days. The
shopping revolution that has led to this retail boom is going to continue and
this is a good news for the government as well as those who wish to work in the
organized sector.
Contribution of FDI in Retailing
Permitting Foreign Direct Investment in the retailing sector
can have immense benefits. It can generate huge employment for the semi-skilled
as well as illiterate population which otherwise can't be employed in the
already confined rural and organized sector. The retail sector is highly
dependent on the rural sector. Thus it can facilitate the improvement of the
standard of living of farmers by purchasing commodities at a reasonable cost.
It also stems out an indirect employment generation channel by training and
employing people in the transportation and distribution sectors such as
drivers, mechanics etc. It is also evident that real estate is a genuine
challenge for organized retailing. Traditional retailers can use this situation
in their favour by taking franchisees of the mega players of this industry. On
the other hand, the consumer gains from the wide variety of choices and a more
diversified basket of prices available under one roof. Secondly the indirect
benefits like better roads, online marketing, expansion of telecom sector etc.
will give a 'big push' to other sectors including the rural one itself. Last
but not the least the huge tax revenue generated from these retail biggies and
collected in government coffers will gradually wipe out the ugly looking fiscal
and revenue deficits. Besides the transaction in foreign currencies by these
MNCs will create a balance in exchange rate and will bring in stable funds in
the economy as opposed to FII's hot money. This will in turn act as a boost to
the developing (or 'transforming', as suggested by the USAID) economy of India.
The phobias relating to FDI in the retail sector are
unfounded as neither the retailing sector in India is an infant industry, nor
it can outweigh the paramount local tastes and preferences.
Let's pray that the retail sector like the IT and
manufacturing sector brings happiness in the eyes of the people and help remove
the regional and class-based disparities.
Q.2 Discuss different
types of store based retailer. Give examples of each.
Q.3 Explain the GAP
Model of service quality.
Q.4 Define Retail
store image & describe factors influencing it.
Q.5 What is
positioning? Discuss various positioning approaches.
Q.6 Explain the
various elements of communication mix included in retail chain.
Summer 2012
Master of Business Administration - MBA Semester 3
MK0012– Retail Marketing - 4 Credits
Book ID: B1222
Assignment Set- 2 (60 Marks)
Note: Each question
carries 10 Marks. Answer all the questions.
Q.1 How does advertising
help in retail promotions? Discuss the various appeals being used.
Advertisements play a crucial role in promoting a brand and
creating its awareness amongst the masses.
They help in creating an image of a particular product or
brand in the minds of the potential customers. Such a mechanism is also called
Brand Positioning.
What is Advertising ?
Advertising is a medium through which an individual or
organization highlights the USPs and benefits of a product or service to
influence the buying behaviour of the individuals.
It helps to create a positive image of a particular brand in
the minds of the customers and prompts them to buy the same.
Role of Advertising
in Retail
The retailer through various ways of advertising strives
hard to promote his brand amongst the masses for them to visit the store more
often.
Advertisements attract the customers into the store. They
act as a catalyst in bringing the customers to the stores.
The advertisement must effectively communicate the right
message and click on the customers. It should be a visual treat and appeal the
end-users.
Advertisements have taglines to create awareness of a
product or service in the most effective way.
·
The tagline has to be crisp and impressive to
create the desired impact.
·
The tagline should not be lengthy else the
effect gets nullified.
·
It has to be catchy.
·
It should be simple to memorize.
·
The moment an individual hears “Just Do it”, he
knows he has to visit a “Nike Store”. That’s the importance of a tagline.
Modes of Advertising
Nothing works better than promoting a brand through
signboards, billboards, hoardings and banners intelligently placed at strategic
locations like railway stations, crowded areas, heavy traffic crossings, bus
stands, near cinema halls, residential areas and so on. Such advertising is
also called as out of home advertising.
·
Out of home advertising is a way to influence
the individuals when they are out of their homes. The hoarding must be
installed at a height visible to all even from a distance.
·
Make sure it catches the attention of the
passing individuals and influences them to visit the store.
·
Keep it simple and make sure it doesn’t confuse
the customers; instead it should convey the information in its desired form.
·
Print media is also one of the most effective
ways to promote a brand. Newspapers, magazines, catalogues, journals make the
brand popular amongst the individuals. Retailers can buy a small space in any
of the leading newspapers or magazines; give their ads for the individuals to
read and get influenced.
·
Television also helps the brand reach a wider
audience. Now a day’s retailers also use celebrities to endorse their products
for that extra zing. Celebrities are shown using the particular brand and thus
making it a hit amongst the masses.
·
Sachem Tendulkar - the famous Indian cricketer
endorses Castrol India, MRF tyres, Adidas, Boost etc.A child gets influenced to
drink Boost because his favourite cricketer drinks the same.
·
Radio Advertisements also help in creating brand
awareness.
·
Social networking sites have also emerged as one
of the easiest and economical ways to promote a product or brand.
Two approaches may be
used to increase both customer traffic in your store and the sale of specific
items or merchandise lines. These approaches, best used in conjunction with
each other, are:
Ø
Retail
advertising - which addresses those potential customers who are not within
the store
Ø
In-store
promotions - which can attract the attention of customers within the store
or via window displays
Ø
Retail Advertising
- Retail Promotion
Although the primary purpose of this section is to discuss
merchandise management, advertising is so important to the concept that its
inclusion, though brief, is necessary.
There are two major
types of advertising:
Advertising to acquaint potential buyers with the special
features of a product. With many industries, advertising of this type is done
by the manufacturer of the product. Quite often, however, the retailer must do
some of this advertising. When this occurs, it is often necessary to work with
an advertising agency so they may help you write the copy (wording) such that
the advertising will bring the best results. Such advertising concentrates
almost solely on the single featured product.
Advertising the availability and price of nationally known
merchandise. Much retail advertising is merely directed at letting potential
customers know that the product is available and informing the customer of
special prices or promotions which may encourage her/him to buy, at your store.
This is perhaps best done through 'Omnibus' ads which feature many products,
their prices, and brief slogans about their benefits. Consumers very often
"shop" such ads and will come into your store to buy one or two of
the items listed. While there, they buy other things on impulse.
Whatever your message may be, there are many ways to
advertise - depending on how much information you wish to impart to prospective
consumers, what kind of information (audio and/or visual), and how many
consumers you wish to reach.
Retailers who cater to local clientele may use advertising
methods such as:
·
In-house flyers indicating products and bargains
·
Signs both internal and external to the store
·
Informative in-house displays of merchandise
·
Direct mail advertising
·
Local newspapers
·
Distribution of flyers by hand or using the
local newspaper deliveries (some papers have such arrangements)
·
Those retailers who wish to launch a large scale
campaign may, of course, resort to advertising via radio, television, or widely
circulated newspapers.
It is very important to remember that for any kind of
advertising, single ads bring very sparse results. In order to make an
advertising campaign successful, it is usually necessary to advertise
repeatedly (five or six times during a one to two week period) to acquaint
consumers with your service or product and, most important, with your store. It
is also necessary to maintain a regular program of advertising throughout the
year in order to continue bringing customers into the store.
Continual experimentation is necessary to determine which
approaches are best. Although proper advertising may involve an initially high
expense, if it succeeds both in drawing more clientele into your store and in
increasing sales in both advertised and unadvertised products, the initial
investment may more than pay for itself.
Once advertising has brought the consumer into your store,
promotion and sales efforts must transfer the customer's attention and interest
into desire and action to buy.
Ø
In-Store
Promotion
Promoting merchandise may often be achieved by special
arrangements with a manufacturer or a wholesaler. Often new merchandise will be
offered at low introductory prices and the manufacturer or wholesaler will
provide the retailer with special informative displays of the product as well
as offer special rewards to the consumer.
Many times a manufacturer will not offer displays but you
will want to promote certain merchandise nevertheless. Basic ways through which
you may create your own in-store promotions are:
·
window displays
·
special in-store displays
·
signs and posters
·
personal selling efforts
·
Retail Displays
·
Both in-house displays of merchandise and
advertising displays should be:
·
attention getting in coloration and layout
·
informative in regard to the product
·
either a direct or subtle sales pitch to
convince the customer that he or she needs the product
·
informative of price, especially if it is a
'special price'
·
Both display advertising and in-house displays
often do well to feature a number of related products, some of which may or may
not be on sale.
Past studies in advertising have shown that a person's eye
is generally attracted to the center of a display, then off to the right of
center and lastly reaches the edge of the display. It is therefore good
practice to place a featured item, which may be on sale, at the center of the
display and another product for which you most wish to generate sales, to the
immediate right of the featured item. Other related products may be placed
outward from around the center of the display.
When creating a display, it is important to tie-in
merchandise lines with one another wherever possible. In this way, customers
who are in the market for a specific product are also exposed to many related
products and accessories which they will often buy. Such tie-in displays also
create a more organized appearance of your store and will make products easier
to find. For example, a person looking for toothpaste might be more likely to
buy a toothbrush, dental floss, or mouthwash if those products are in close
proximity to the toothpaste.
Tie-in displays also help to generate impulse buying. Quite
often an advertised or 'sale' product will draw people into the store who will
buy not only the advertised product but will also buy, on impulse, other
unadvertised merchandise. Sales are often helpful to impulse buying since, when
people feel they are getting a good bargain, they are often likely to
reciprocate by purchasing other merchandise from you with money saved from the
sale.
Sales Effort.....................
Q.2 What is the
significance of proper merchandise presentation? What is cross-merchandising?
Q.3 What is
psychological pricing? Determine its effectiveness.
Q.4 Differentiate
relationship marketing and transaction marketing.
Q.5 Explain the
concept of social marketing. Discuss the P’S under social marketing.
Q.6 Discuss the
advantages and disadvantages of E-Tailing.
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