Marketing Key Terms

Exam 2 Key Terms

CH.7

TRADE AREA- geographic are that incompasses most of the customrs who would patronize specific retail site.
FREESTANDING SITE- indivisual isolated store unconnected to other retailers.
OUTPARCELS- not connect to other stores in a shopping center but located on the premaces.
CENTRAL BUSINESS DISTRICT- traditional downtown business are in city or town.
MAIN STREET- shopping area in smaller town or to a secondary business district in suburb or within a larger city.
INNER CITY- high density urban. Higher unemployment and lower median income.
SHOPPING CENTER- a group of retail or other establishments that are planned, developed, owned and managed as a single property.
NEIGHBORHOOD CENTER- strip shopping centers: attached rows of non enclosed stored with on site parking infront of store.
COMMUNITY STRIP SHOPPING CENTER- same
STRIP SHOPPING CENTER- same
POWER CENTER- consists of collection of big box retail stores. (lowes, staples, barnes and nobles)
SHOPPING MALL- enclosed climate controlled lighted – FUCKING MALL
LIFESTYLE CENTER- open air configuration of specialty sotres.
MIXED USE DEVELOPMENT- (retail, office, residential, hotel, recreation)
OUTLET CENTERS- outlet malls
POP-UP STORES- temp locations for limited or new products
MERCHANDISE KIOSKS- FUCKING KIOSK

CH.8

METROPOLITAN STATISTICAL AREA- 50,000 or more inhabitants
MICROPOLITAN STATISTICAL AREA- 10,000 inhabitants
TRAFFIC FLOW- number of vehicles and pedistrians that pass by site.
ACCESSIBILITY-ease in and out of site
NATURAL BARRIERS- rivers or mountains
ARTIFICIAL BARRIERS- railroad tracks etc
CONGESTION- traffic results in customer delays
VISIBILITY- see store from street
CUMULATIVE ATTRACTION- stores that attract same consumers. Locations with complimentsry , competing adjacent retailers that have potential to build traffic.
TRADE AREA – area that accounts for majority of a stores sales and customers
PRIMARY TRADING AREA- 50-70% of customers
SECONDARY TRADING AREA – 20-30%
TERTIARY TRADING AREA - remainder
FRINGE - same
PARASITE STORE – doesn’t create own traffic and trade area is determined by dominant retailer in shopping center (dry cleaner to walmart store)
CENSUS- population count
GEOGRAPHIC INFORMATION SYSTEM- store retrieve and map and analyze geographic data
PERCENTAGE LEASE- rent based on % of sales
FIXED RATE LEASE- fixed amount a month for life of lease

CH. 9

EMPLOYEE PRODUCTIVITY- retailer sale or profit divided by number of employees
EMPLOYEE TURNOVER- number of employees leaving job/ number of positions
ORGANIZATION STRUCTURE- activites to be performed by specific employees and determines authority and responsibility in the firm.
SPECIALIZATION- employees responsible for 1 or 2 tasks
BUYER- handles advert and slection and inventory managegment
MERCHANDISING PLANNER- aloocate merch and tailor assortment of catergories of specific stores in geographic area
CENTRALIZATION- when authority for retail decisions in delegated to corporate manager
DECENTRALIZATION- assigned to lower levels
ORGANIZATION CULTURE- values of a firm that guides employee behavior
EMPOWERMEN- procees where managers share power and decision making authority with employees.
FLEXTIME – scheduling system to be able o choose time to work
JOB SHARING – two employees voluntarily responsible for job held by another person
GLASS CEILING- invisible barrier making difficult for growth in minorities and women.
ILLEGAL DISCRIMINATION- members of a protected class treated unfairly.
PROTECTED CLASS- group of individuals that share common characteristics as defined by the law
DISTRIBUTIVE JUSTICE- hen 0utcome received are viewed as fair with respect of the outcomes received by others.
PROCEDURAL JUSTICE- based on fairness of process used to determine the outcome.

CH. 10

SUPPLY CHAIN MANAGEMENT- set of activites and teqhniques to manage flow of merch from vendors to retail customers.
STOCKOUT- SKU is not available
UNIVERSAL PRODUCT CODE- UPC: barcode – description and info
ADVANCED SHIPPING NOTICE- tells distrib center when and where its being delivered
ELECTRONIC DATA INTERCHANGE- computer to computer exchange of business documents in a standardized format.
SECURITY POLICY- set of rules that apply to activites involving computer and communication resources that belong to an organization.
LOGISTICS- aspect of supply chain management that refers to to plan& implementation of everything
CROSS-DOCKED –items unloaded from shippers truck and reloaded to trucks going to stores immediately.
PULL SUPPLY CHAIN- request from merch generated from store level based on sales data.
PUSH SUPPLY CHAIN- merch allocated to stores on basis of forecasted demand.
REVERSE LOGISTICS- process of capturing value from properly disposing of merch retirned by customers or stores.
DROP-SHIPPING – retailers receive orders from customers and relay the orders to vendors and then vendors ship merch directly to customers.
CONSUMER DIRECT FULLFILLMENT- same
VENDOR MANAGED INVENTORY- improving supply chain effeciancy in which vendor in responsible for maintining the retailers inventory level.
COLLABORATIVE PLANNING FORECASTING & REPLENISHMENT- CPFR: sharing of forecast and related business info and collaborative planning between retailers and vendors to improve supply chain efficiency and product replenishment.
RADIO FREQUENCY IDENTIFICATION- tech that allows object or person to be identified at a distance by means of radio waves.

CH. 11

CUSTOMER RELATIONSHIP MANAGEMENT- philosophy that focus on identifying and building loyalty with retailer and most valued customers.
SHARE OF WALLET- % of customers purchases made from the retailer.
CUSTOMER LOYALTY- committed to buying merch from retailer.
CUSTOMER DATABASE- all data the firm has collect abou the customers and is first step of CRM process.
FREQUENT SHOPPER PROGRAM- identify and provide reward for customer who patronize a retailer
LOYALTY PROGRAM- same
OPT IN- EUROPEAN costumer owns personal info. Retailer must get consumer to agree to share the info
OPT OUT- US personal info is in public domain and retailers use however they want and consumers tell retailer not to use info.
MARKET BASKET ANALYSIS- type of retail analytics that focuses on examining the composition of products purchased by a household during a single shopping occasion.
CUSTOMER LIFETIME VALUE- expected contribution from the cosutomers to the reailer profits over their entire relation with retailer.
80/20 RULE- 80 % of the profits come from 20% of customers.
RFM ANALYSIS- recency, frequency and monetary analysis: often used by retailer and direct marketers, identifies retailers best prospects based on how much they have bought how recently they’ve bought and how frequent they buy.
ADD-ON SELLING – offering and selling more products and service to existing customer to increase retailer share of wallet with these customers.

CH.12

MERCHANDISE MANAGEMENT- right quantity, merch , place and time
MERCHANDISE GROUP- FIRST LEVEL group within organization managed by sr vp responsible for several departments.
DEPARTMENT- SECOND LEVEL managed by divisional merch managers
CLASSIFICATION- THIRD LEVEL GROUP OF ITEMS TARGETING SAME CUSTOMER TYPE
STOCK KEEPING UNIT- smallest unit available for inventory control.
MERCHANDISE CATEGORY- assortment of items that customers see as substitutes for one another.
CATEGORY MANAGEMENT- assigns one buyer or category manager to oversee all merch activities for the entire category.
CATEGORY CAPTAIN- works with retailer to develop a better understanding of shopping behavior, create assortments that satisfy consumer needs and improve the profitability of merch category.
STAPLE MERCHANDISE- in continuous demand over extended time period.
BASIC MERCHANDISE- same
FASHION MERCHANDISE- in demand over short period of time.
SEASONAL MERCHANDISE- sales flux with time of year.
DEPTH INTERVIEW- unstructured personal interview where interviewer uses extensive probing to get individual respond to talk in detail about subject.
FOCUS GROUP- small group of respondence interviewed by moderator using loose format
ASSORTMENT PLAN- set of SKU that a retailer will offer in a merchandise category in each of its stores.
VARIETY- breadth. # of categories offered
ASSORTMENT- depth. # of SKUs within category
BACKUP STOCK- inventory using to guad against going out of stock when demand exceeds forecast or merch is delayed.
BUFFER STOCK - same
SAFETY STOCK - same
PRODUCT AVAILABILITY - % of the demand for a particular SKU that is satisfied.
CYCLE STOCK – inventory for which level goes up and down due to replenishment process.
BASE STOCK- same
LEAD TIME- amnt of time between recognition of when order needs to be placed and the point which merch arrives at store and is ready for sale.
FILL RATE- % of complete orders received from a vendor
ORDER POINT- amount of inventory below which quantity available shouldn’t go or item will be out of stock before other order arrives.
OPEN-TO-BUY – used to keep track of merchandise flows: i.e. when present inventory level is, when purch merch is scheduled for delivery, how much has been sold.
SELL-THROUGH ANALYSIS- compares actual and planned sales to determine whether more merch is needed to satisfy demand or whether price reductions are required.
MARKDOWN MONEY- funds provided by a vendor to a retailer to cover decreased gross margin from markdowns and other merchandising issues.
ABC ANALYSIS- identifies the performance of individual SKUs in the assortment plan.
VIDEO:
Mall of the Americas:
-Super Mall
-Environmental Factors: 1. large local market: 3 million ppl live around. * 67,000 median income (average) 2. Natural tourist area * 10,000 lakes 3. Consumer desire to combine shopping/ entertainment
-Not work: 1. Decline in shopping malls. (built in 1992) 2. Stores don’t want get in because of too much competition.
-5 Challenges 1. Getting investors (never ben done) 2. Authorizations (5 yrs to get through govt) 3. Design (how to design so big) 4. logistics (bathroom, parking) 5. Advertising (tourism manager)
-Why locate there? * high foot traffic
-Why not: 1. high rent 2. people there just for entertainment. 3. Size: too intimidating.

VIDEO
Dominoes Pizza
-Cultural and Societal Differences *Adjust to local taste *Consistent signage and logos *High traffic
-Entry Strategy *Master Franchising Strategy -Partner with entrepreneur in that country

CASE:
Stephanie Wilson Boutique
-PLUS and MINUSES
1. Downtown Arcade + center of business district wasn’t opened yet, not sire what customers would like.
2. Tenderloin Village + favorable lease terms + upscale clients small traffic
3. Apple Tree Mall + High foot traffic competitive high rent
-Changes Merchandise Based On:
1. Cater to working women more traditional: DWNTN ARCADE
2. Charge more- eclectic clothes: TENDERLN VILLAGE
3. Charge less and sell at high volume.: APPLE TREE MALL

VIDEO
Suburban Regional Malls
-SWOT
*Strength- secure/safe. Protected from weather *Weakness- high rent/ age *Opportunity- renovation/ combine entertainment with shopping. *Threats- interest rates/ over supply of retail space.

-Description
1. Neighborhood center *food or drug store anchor
2. Regional Mall *department store anchor with inline specialty store
3. Power center *free standing stores. Typically category killers
4. Outlets *owned by manufacturer themselves

-Function
1. Tends to attract more ppl
2.Larger ad budgets

-Zonal Merchandising: group similar retailers by category to allow comparison shopping.

-Type of Entertainment Sources
1. Movies
2. Restaurants
3. Mixed use developments

VIDEO
Lifestyle Center
-What is it?
1. hybrid mall w/ high end retailer and easy parking.
2. Social experience
3. Designed for convenience and people who don’t want to browse.

-Appealing
1. convenient
2. smaller
3. catered to adult men
4. occupancy cost/ opp restrictions are lower

CASE
Hutch Women Apparel

-How people in trade are compete with their target market?
1. price conscious woman
2. 18 – 40 yr old
3. Dalton is larger but Hinesville is growing faster.
4. Dalton is more affluent and Hinesville is more educated.
5. Dalton has a larger % of ppl in the target age group, Hinesville is more attractive from competition standpoint

-How do locations fit with requirements
1. Location range: population between 10-15 thousand ppl.
2. Trade area: 50- 100K ppl
3. Major Issues *D: drout *H: 80% of town military.

-Which location and Why? *D: demand perspective more effective *H: under stored

VIDEO
Patagonia

-Why good place to work? 1. Employee Loyalty *support from founder * loyal customers *little turnover 2. Benefit offered *”let my people surf” *flex hours *internships with grassroots programs 3. Corp. Envir. Values *Do you need this product *1% for planet *Employees serve on grants committees.

CASE
Avon

-Why so commited to diversity?
*Women know what women want

-Why not follow the lead?
*Different target market
*Different selling approaches

-Opportunities
1. International Expansion
2. Appealing to young
3. Appealing to men

VIDEO
Physical Distribution Video

-Key benefits to barcodes in the retail supply chain
1. warehouse and distribution cost savings, 25-30% savings
2. accuaracy and ability to handle more data
3. less paperwork
4. lower cost for consumer
-Advantages/disadvatages of RFID technology -Advantages 1. Read out of line of sight 2. Accuarcy is constant regardless of where the chip is -Disadvantages 1. Cost is higher than barcodes

CASE
Diva and Generation Y Case

-How Diva can make Gen Y employees aware of opportunities
1. Career progression
2. Share success stories
- Pros and Cons Pros
1. Improve goal setting/self improvement
2. Could lead to good salary
Cons.
1. may not attract gen y
-How others attract Gen y
1. flexible work environment
2. lack of corporate culture
3. very engaging workplace

VIDEO
Creston Vineyards Video
-Business functions and value provided by distribution channel
1. transactional
2. logistical
3. facilitating adds value 1.provide assortment 2. breaks down bulk 3. hold inventory 4. provide services
-Channels they use
1. traditional channel of brokers and distributors
2. wine clubs
3. trader joes
-Firms involved in their primary channel and their role
1. distributor take title
2. broker does not take title but makes a commission
-Why use multiple channels?
1. To reach different segment
-Selling Online Opprotunities
1. can sell for cheaper cause avoids middle man
Problem
1. Illegal in certain states

CASE
Nordstrom Loyalty Program

-Design Characterisitics
1. must be tiered, more you spend the greater the savings
2. have a lot of choices for rewards
3. reward all transactions
4. transparency and simplicity
-Effectiveness in developing customer loyalty
1. Select one day a year when they offer double or triple point on a non traditional shopping day
-Who they should target?
1. frequent shoppers
2. moving second tier to first tier
- Is it worth what they are spending? Cost
1. Rewards themselves
2. Training
3. Database
Benefits
1. Repeat customers
2. Cross selling opportunites
3. Great share of wallet
-Role of luxury consumers
1. Into personalized service
Stregths of fashion rewards
1. gives you points if you shop outside the store
Strength of incirle
1. know for rewards themselves

VIDEO
Rubios Video

-Why high failure rate?
1. Considereable competition casue cost of entry is low
2. selling service more than a product
-Franchising Advantage
1. capital from franchise
2. mangers more motivated
- Franchising Disadvantage
1. less cash flow and profits
2. less control of operation
3. Free riding (when franchisee invesrt properly so brand suffers)
- Why no franching for higher quality restaurants?
1. has a unique asset (ex. Chef)

VIDEO
West Point Market Video

-How can they compete in a market served by a number of larger supermarkets?
Most supermarkets target broad middle market while west point offers unique high quality merch for upscale customers

CASE
Lindsy Bridal Shop

-Should she change the emphasis of her merchandise mix to increase sales?
Yes. Deemphasize flowers.
-Which products should have more emphasis? Les?
Items for men
-Lindys personal decision?
1. herself. How committed she is going to be.
2. needs to hire business manager
-How to balance family and business?
Be full time in both