Background of The Study

MARKETING RETAIL THROUGH STORES AND ONLINE
Background of the Study
Marketing is a business term that experts have defined in dozens of different ways. In
fact, even at company level people may perceive the term differently. Basically, it is a
management process through which products and services move from concept to the
customer. It includes identification of a product, determining demand, deciding on its
price, and selecting distribution channels. It also includes developing and implementing
a promotional strategy. Marketing is the management process responsible for identifying,
anticipating and satisfying customer requirements profitably.
Marketing in retail store can be can be physical or intangible. Either way, it’s important to
compartmentalize whatever you’re offering into a neat unit. Retail stores that sell directly
to consumers face a different set of marketing challenges than other industries. Small
business owners can easily get too involved in the day-to-day operations of their retail
stores to spend any time brainstorming marketing ideas or promotional events. Some
retailers worry that marketing is too expensive, others may find it too time-consuming.
There are 97% of people start their search for local retail businesses online, 90% use
search engines to do so.
Years ago, when people wanted to find a particular product, they would turn to the phone
book. Today, their “phone books” are search engines, business directories, and review
sites.
Local search marketing will ensure that your business website is prominently placed in
front of potential customers with tools such as: Business listing optimization - Ensure
people know your business exists with a strong digital footprint. Map optimization - make
it easy for people to see your locations and get directions. Local search optimization -
Attract local searchers seeking what you offer with geographic and product-specific
keywords. Local online advertising - Optimize PPC and social ad campaigns to target
your specific audience. Customer reviews - 80% trust online reviews as much as
recommendations from friends. Product feeds - Submit your products to search engines,
comparison shopping sites, and more. Blogging - Bolster your search rank and keep
people on your site with high-quality content. Email marketing - Stay in contact and keep
your audience engaged with helpful, relevant information.
Retailers use various advertising and communication tools to grow awareness and
considerations with future customers. Finding the right marketing mix can lead to a
profitable growth and a higher return on investment. By considering the right advertising
strategy retailers can persuade consumers to choose to do business with their retail
brand. The fundamental approach used my modern retailers in marketing their products
is the Four Ps of Retail Marketing.
Product: There are two primary types of merchandise. Hard or durable goods like
appliances, electronics, and sporting equipment. And soft goods like clothing, household
items, cosmetics, and paper products. Some retailers carry a range of hard and soft items
like a supermarket or a major retail chain while many smaller retailers only carry one
category of goods, like a boutique clothing store.
Price: Pricing is a key element to any retail strategy. The retail price needs to cover the
cost of goods as well as additional overhead costs. There are four primary pricing
strategies used by retailers:
1. Everyday low pricing: The retailer operates in thin margins and attracts customers
interested in the lowest possible price. This strategy is used by big box retailers like
Wal-Mart and Target.
2. High/low pricing: The retailer starts with a high price and later reduces the price when
the item’s popularity fades. This strategy is mainly used by small to mid-sized
retailers.
3. Competitive pricing: The retailer bases the price on what their competition is charging.
This strategy is often used after the retailer has exhausted the higher pricing strategy
(high/low pricing).
4. Psychological pricing: The retailer sets the price of items with odd numbers that
consumers perceive as being lower than they actually are. For example, a list price
of $1.95 is associated with spending $1 rather than $2 in the customers mind. This
strategy is also called pricing ending or charm pricing.
Place: The place is where the retailer conducts business with its customers. The place
can be a physical retail location or a non-physical space like a catalog company or an e-
store. While most retailers are small, independently owned operations (over 90%), over
50% of retail sales are generated by major retailers often called “big box retailers” (see
the list of the top 20 big box retailers below).
Promotion: Promotion is the final marketing mix elements. Promotions include personal
selling, advertising, sales promotion, direct marketing, and publicity. A promotional mix
specifies how much attention to pay to each tactic, and how much money to budget for
each. A promotion can have a wide range of objectives, including increasing sales, new
product acceptance, creation of brand equity, positioning, competitive retaliations, or the
creation of a corporate image.
In recent years, to address the need of taking a more customer-oriented approach to

marketing, the 4 Ps of Retail Marketing have been revised and replaced by the 4 Cs:
Consumer, Cost, Communication, and Convenience.
Consumer (versus Product): Instead of focusing on the product the retailer wants to
sell, a smart retailer studies the wants and needs of its consumers before going to market.
The more clearly a retailer understand the wants and needs of its customer base, the
greater chance it will have of attracting customers and increasing sales.
Cost (versus Price): In retail a cost is the value of money that has been used up to
produce something. Factors that influence cost include the customer’s cost to change to
a new product and the customer’s cost for not selecting a competitors product.
Convenience (versus Place): The Internet has made Place less of a factor in consumer
purchasing decisions. Convenience addresses the ease of completing a transaction
including the ease of finding information about a product, finding the right product, and
purchasing a product.
Communication (versus Promotion): Communications including a range of efforts

including advertising, public relations, grassroots efforts, social media, and any other form
of communication between the company and the consumer.
Becoming aware of the fundamentals of retail marketing (the four Ps and the four Cs) is
critical to becoming a best-in-class retailer.

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MARKETING RETAIL THROUGH STORES AND ONLINE

Background of the Study

In recent years, to address the need of taking a more customer-oriented approach to

Communication (versus Promotion): Communications including a range of efforts

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