what marketing decisions do these marketing intermediaries make ?
TRANSCRIPT
Until a target market is not defines , consistent decisions
cannot be made about product assortment , décor and
advertisements .and service levels
Fashion and You , the online retail portal has found success by offering brands at discounted prices to its customers
Channels
Fabindia reaches individuals and institutional buyers with its unique ethnic offerings through multiple channels.Some of which includes Internet , stores and catalogs
Product Assortment
( A)
( B )
( C )
( D )
Product assortment is done on basis of1)Length2)Breadth
(a)Narrow and shallow assortment –Small lunch
counters(b)Narrow and deep
assortment-Delicatessen
(C)Broad and shallow assortment –Cafeteria
(d) Broad and deep assortment -Restaurant
Some possibilities of product assortment :
•Feature Exclusive national brands that are not available at competing retailers –Wills Lifestyle has added Wills Luxuria, an expensive men’s wear range .
•Feature mostly private labelled merchandise –Benetton and GAPmostly carry privately labelled clothing in their stores.
•Feature surprise or ever changing merchandise –Men’s Wearhouse offers a surprise assortment of export surplus at heavy discounts .
Feature blockbuster distinctive merchandise events
Bloomingdale’s ran a month
long celebration for the Barbie doll’s 50thanniversary
Feature the latest or newest
merchandise first
ZARAexcels in and profits from being first to market with appealing new looks
Use of computers to track inventory , compute economic order quantities , order goods and
analyse money spent on vendors and products.
Radio frequency Identification ( RFID )- Is used to to monitor inventory and track goods
in real time .
Direct product profitability ( DPP )- to measure a product’s handling costs from the time it reaches the warehouse until a customer buys it in the retail store.
All retailers want HIGH (turns X earns)
But both do not go together
Most of then fall into :(1) high markup–lower volume(2) low markup–higher volume
Store Activities and experiencesThere has started a fight between Internet and Store shopping.
Stores can use this fact as a plus point .Customers can first experience the product and then buy which is not possible
in online shopping
Panasonic and Sony create a Home like environment at their stores to let their customers experience their home theatre
Communications
Ads in magazines like Vogue, Vanity Fair etc
•Discount coupons •Membership cards •Special sales on
holidays
(1)Shopping Strips(2)Store inside a large store(3)Stand alone stores
(1)Shopping Strips
(2)Store inside a
large store3)Stand alone stores
More stocking
Faster DeliveryBut , Higher Cost
To reduce costs : •Centralize the inventory •Use faster transport •Assembly, packaging , and constructing promotional display in the plants itself
INVENTORY COST:
cost related to storing, maintaining its inventory over a period of time .Increases at an accelerating rate
ORDER POINT:
-- inventory draws down(at what level to place a new order).-Should maintain the balance.
-Balance the risks(stock-out against the cost of overstock)
Order processing cost-stable setup costs, running costs(of items)
a. Low setup cost- stable average cost
b. High setup cost- reduce the average cost
•Larger the quantity ordered, less frequently an order needs to be placed
•ORDER-PROCESSING COST, compared with INVENTORY CARRING COSTS.
•Order processing cost and inventory:
carrying costs sum up at different order levels graph.
•POSITIONING OF INVENTORY ITEMS-according to risk and opportunity.
-bottleneck items(high risk, low opportunity)-critical items(high risk, high opportunity)-Commodities items(low risk, high opportunity)-Nuisance items(low risk, low opportunity)
•NEAR ZERO INVENTORY STRATEGY-build for order, not for stock also known as SOMO, “sell one, make one.”
Criteria to keep in mind while for shipping :
•Speed•Frequency•Dependability
•Capability•Availability•Traceability•Cost
Containerization
consists of putting goods
in boxes or trailers that are easy to
carry between two
transport modes.
Fishyback
Trainship
PiggybackAirtruck