Reading...
Play button
Play button
Use LEFT and RIGHT arrow keys to navigate between flashcards;
Use UP and DOWN arrow keys to flip the card;
H to show hint;
A reads text to speech;
60 Cards in this Set
- Front
- Back
|
Wholesalers
|
sell to retailers but not directly to consumers (may sell to consumers but mostly to retailers)
|
|
|
Retail mix
|
a retailer’s combination of merchandise, prices, advertising, location, customer services, selling, and store layout and design that is used to attract customers
|
|
|
Standard stock list
|
requires that all stores in a chain stock the same merchandise
|
|
|
Optional stock list
|
allows each store in a chain the flexibility of tailoring its merchandise mix to local tastes and demands
|
|
|
Category captain
|
a vendor who helps the retailer manage its limited shelf space by determining “what kind” and “how many” units of a specific product to carry on the shelves in each store
|
|
|
Private-label branding
|
a retailer, or its wholesaler, develops its own brand name
|
|
|
Gross margin
|
net sales minus the cost of goods sold
|
|
|
Gross margin percentage
|
how much gross margin the retailer makes as a percentage of sales (aka gross margin return on sales); 40% gross margin means that for every dollar of sales, the retailer generates 40 cents in gross margin dollars
|
|
|
Operating expenses
|
the expenses the retailer incurs in running the business other than the cost of the merchandise (e.g. rent, advertising, etc.)
|
|
|
Inventory turnover
|
the number of times per year, on average, that a retailer sells its average inventory (ex: avg. inventory=$40 and annual sales=$240, inventory turnover=6 times per year)
|
|
|
Relationship between gross margin percentage and inventory turnover
|
retailers can make profit by earning and/or by turning (high gross margin percentage and/or high inventory turnover); high profit retailers are those that do both
|
|
|
Four types of locations for retailers
|
business district, freestanding, nontraditional, mall/shopping center
|
|
|
Anchor stores
|
dominant, large-scale stores that are expected to draw customers to a shopping center
|
|
|
Balanced tenancy
|
occurs where the stores in a shopping center complement each other in merchandise offerings
|
|
|
6 Types of store-based retailers
|
department stores, specialty stores, supermarkets, supercenters, category killers, convenience stores
|
|
|
Category killers
|
carry such a large amount of merchandise in a single category at such good prices that they kill the competition
|
|
|
Scrambled merchandising-
|
selling random merchandise simply because it’s profitable with no regard for product mix or consistency (like makeup in a grocery store)
|
|
|
5 types of non-store retailing
|
street peddling, direct selling, mail order, vending machine operators, and electronic shopping
|
|
|
Atmospherics
|
“feel” of the store; physical layout
|
|
|
SKU
|
stock keeping unit
|
|
|
3 Factors that affect the retailer’s ability to attract customers (beyond their control)
|
store compatibility, natural forces (weather), economic forces
|
|
|
Store compatibility
|
when two similar businesses (e.g. two shoe stores) locate near each other, they achieve an increase in sales compared to when they are located apart
|
|
|
Convergence
|
convergence of consumers, products, prices, and retailers; consumers of all income levels often shop at the same stores, even for the same goods
|
|
|
Direct marketing
|
non-store retailing; communication is direct between marketer and consumer
|
|
|
IMC
|
Integrated Marketing Communications; concept in which all promotional activities are carefully integrated and coordinated to deliver a clear, consistent unified, and compelling message about the organization and its products
|
|
|
Promotion Mix
|
the combination of public relations, sales promotion, direct marketing, guerilla marketing, and personal selling used to communicate with consumers
|
|
|
Personal selling
|
person-to-person communication in which a seller informs and educates prospective customers and attempts to influence their purchase choices
|
|
|
Sales promotion
|
all marketing activities that attempt to stimulate quick buyer action (try to promote an immediate sale) possibly by incentives, etc.
|
|
|
Sponsorship marketing
|
the practice of promoting the interests of a company and its brands by associating the company with a specific event or a charitable cause
|
|
|
Database marketing
|
collecting and electronically storing (in a database) info about present, past, and prospective customers
|
|
|
Pull strategy
|
promotional plan to develop consumer demand for a product and consumers then urge the stores to stock the product
|
|
|
Push strategy
|
promotional plan to have stores stock a product, making it available to consumers
|
|
|
AIDA concept
|
attention, interest, desire, action
|
|
|
Trade shows
|
a temporary forum for sellers of a specific product to exhibit their goods
|
|
|
Trade allowances
|
deals offered to retailers simply for purchasing the manufacturer’s brand or for performing activities in support of the manufacturer’s brand
|
|
|
Off-invoice allowances
|
a type of trade allowance in which the retailer gets to deduct a fixed amount from the price when they order the manufacturer’s product
|
|
|
Trade promotions
|
special incentives offered by manufacturers to their retailers/wholesalers, which are meant to be passed along to consumers in the form of discounts, etc.
|
|
|
Forward/bridge buying
|
when retailers buy enough of a product during the manufacturer’s off-invoice allowance period to carry them over until the next one
|
|
|
Consumer promotions
|
directed at end users rather than at the trade (e.g. sampling, rebating, etc.)
|
|
|
5 Ms of advertising
|
mission (what do you want to accomplish?), money (how much to spend?), message (what’s the main idea?), media (what communications form to use?), measurement (how to evaluate results?)
|
|
|
Guerilla Marketing
|
use of unconventional low-cost techniques to attract consumer attention to and interest in the product
|
|
|
Viral Marketing
|
the internet equivalent of WOM; e-mail messages, offers spread by customers online
|
|
|
Sales process
|
prospecting & qualifying, preapproach, approach, presentation/demonstration, handling objections, closing, follow-up
|
|
|
Prospecting & qualifying
|
finding customers who are qualified to buy
|
|
|
Preapproach
|
the salesperson learns as much as possible about the prospect prior to the initial visit
|
|
|
Features of managing the sales force
|
strategy and structure, recruitment and selection, training, compensation, supervision and motivation, evaluation
|
|
|
Types of sales force structure
|
territorial structure, product structure, customer/industry structure, national accounts
|
|
|
Territorial structure
|
each salesperson is assigned an exclusive geographic territory and represents the company’s entire product mix
|
|
|
Product structure
|
salespeople specialize in selling only one product line
|
|
|
Customer/industry structure
|
salespeople specialize in needs of one customer or one industry
|
|
|
National accounts
|
large national accounts may be handled by special teams with other customers handled by customer/industry specialists
|
|
|
3 Types of sales compensation methods
|
straight salary, straight commission, salary plus commission
|
|
|
CRM
|
customer relationship management; holding info about individual customers to enable employees to act in ways that maximize customer loyalty
|
|
|
Predatory pricing
|
selling below cost with the intention of driving a competitor out of business
|
|
|
Deceptive pricing
|
stating prices or savings that are misleading or are not actually available
|
|
|
Price fixing
|
talking to competitors and agreeing on pricing (this is anti-competitive)
|
|
|
Demand elasticity
|
how sensitive consumers are to price changes; in some markets customers are very sensitive to price increases and will reduce purchases (elastic demand); in others they are not sensitive (inelastic demand)
|
|
|
Capacity
|
when capacity exceeds supply sellers can use price to shift demand to times when excess capacity exists (e.g. matinees at a movie theater)
|
|
|
Price competition
|
marketer emphasizes price to gain customers; attempts to match or beat competitor’s prices; products are generally standardized
|
|
|
Non-price competition
|
marketer emphasizes factors other than price to distinguish products
|
