The retail industry plays a vital role in the economy of the vast majority of industrialized countries. Although it can be an immensely complex enigma to master marketing in retail, it is vital to the success of any retail business. In today’s highly competitive global economy, the inability to effectively develop and implement marketing strategies that are specific to a particular retail brand or industry will inevitably lead to the failure due to poor performance of that retail business.
For the sake of lucidity, retail can be defined any company that focuses its marketing strategy on satisfying the need of the final customer through the organized method of offering and selling services and goods as a means of final distribution. Basically, retail is the most direct manner in which goods and services are provided to a customer — in contrast to manufacturing and wholesale distribution.
Just as with manufacturing and wholesale distribution, retail has its own particular system and methodology when it comes to marketing the brands, products and services that are sold through a particular business.
Effective Marketing in Retail
In order for any retail business to be effective, the products and services that are offered must have a certain level of relevance and attractiveness to the audience or customer base that is being targeted. This necessary attraction can be motivated through need or desire, but it must find a place of relevancy in the mind of the potential customer of the marketing efforts of the business will not be efficacious.
There are two primary approaches to achieving the desired end result in this spectrum of business. A retailer can choose the service or product they prefer to specialize in, subsequently determining the appropriate target audience for that particular type of merchandise. This approach allows the retailer to work with a product that they are familiar and comfortable with. They will then have to conduct the market research to determine the demographic that is most likely to purchase their product.
The second approach is what can be called the “demand” approach. In this particular approach, a retailer will recognize a specific need or demand in a specific geographical location. Once the demand has been identified, the retailer has to conduct the appropriate research to identify the most effective ways to present the product or service to the target audience. In low competition areas, such as small towns, the approach is rather straight forward. The retailer simply has to make sure that the target audience is aware of their existence.
For competitive markets, retailers will have to discover and develop creative methods distinguishing themselves from their competitors. There are multitudinous ways that this can be accomplished. Two ways that have proven highly productive throughout history is building value through competitive pricing and building value through a qualitative differential. The latter is accomplished by presenting a product that noticeably superior to that of the competition. When the competition is offering the same product or services as a retailer. The marketing strategy generally shifts to an image, which is normally established through numerous public relations campaigns.
The Golden Rule of Marketing
If there is a golden rule of marketing, it can be expressed as such, “he who has the gold makes the rules.’ This simply means that the customer is king. Businesses are centered on meeting the expectations of the customer. There are numerous aspects of marketing that must be approached with at least moderate perspicacity.
Some of the aspects of marketing that are vital to the success of any retailer are:
*The management function of the strategy
*The capacity to organize and control the direction of the campaign and the consumer
*The ability to understand who marketing efforts will equate to conversions
*Understanding the importance of proper pricing based on the purchasing power of the customer base.
*The ability to effectively engage the consumer for the purpose of gathering customer intelligence as well as developing an ongoing relationship with the customer throughout the customer lifecycle.
All of the above mechanisms must be managed within the confines of the principle that the customer is king. The ultimate goal is to produce a happy and satisfied customer.
When the average person thinks of marketing, they might envisionsadvertisements, emails, TV commercials and other forms of call to action activity; however, marketing actually begins with the collection of data that is accomplished in a number of ways. The data that is collected is commonly referred to as customer intelligence or CI. CI is the information that is used by the retailer to determine the best method of presenting their brand or product to a particular group. This customer intelligence can tell the retailer what the purchasing triggers are for a customer or what will turn off a customer from buying.
One of the primary methods of containing customer intelligence is through research. There are literally tons of information available through studies, articles and white papers that provide valuable insight on any demographic and any retail industry.
Another method of collecting customer intelligence is to engage the customer directly. This can be done through surveys, mail outs, etc. One method of direct contact that is gaining momentum is engaging customers through social media. It is a non-invasive method of getting individuals to reveal numerous things about themselves. It is also a good way to develop relationships with the customer, which helps to increase the trust between the customer and the retailer. In such a competitive market, trust is an invaluable asset.
When considering a marketing strategy, the retailer must consider a number of things, such as store location, the ambience of the store, the level of customer service and more. The retailer also has to be aware of the competition and the manner in which they are courting the customer. At the end of the day, marketing is about understanding the best way to engage the customer.
The Principles of Retail
As with anything in life, business enterprise function on a bed of principles that work to guarantee a certain standard and level of success; retail is no exception to that rule. There are five primary principles of retail that work to increase the level of success drastically.
The customer is king: The customer is the most important aspect of the retail puzzle. No matter what product is being sold, the success of the business rests on the satisfaction of the customer.
Retail is detail: The ability to manage detail is key in the retail business. It can be a challenge for retailers to determine what details will garner the bulk of their attentions, but this can often be determined by referring to principle number one. When a retailer takes the time to understand the type of customer that will be the primary buyer of their product of services, they will be better equipped to manage the details that matter.
Understand the Four Ps: Product, price, place and promotion. When the retailer has maters this, they will be able to create highly sophisticated marketing strategies that will have great efficacy.
Go the Extra Mile: Customer service is essential to a successful retail business. There are many times in which the only thing to distinguish the difference between two competing retailers is the level of customer service. Customers have come to demand great customer service.
Location: This something that any expert will mention a thousand times. Location is key. Choosing the right location can be the difference between success and failure. Historically, more businesses have failed because of poor location than any other single factor.
Understanding these principles and mastering marketing concepts will not necessarily guarantee retail success, but it definitely increases the odds.
Danny Chard is the Managing Director of Assigns Point-of-Sale and Graphic Display Systemsin both standard and customised formats and sizes. Our range of Retail Display Stands is designed to enable retailers to get their products and services noticed on all levels, whatever the retail environment.