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Positioning, image and the

marketing of multiple retailers
a
Gary Davies
a
Post Office Counters Professor of Retailing ,
Manchester Business School , Manchester, UK
Published online: 28 Jul 2006.

To cite this article: Gary Davies (1992) Positioning, image and the marketing of
multiple retailers, The International Review of Retail, Distribution and Consumer
Research, 2:1, 13-34, DOI: 10.1080/09593969200000002

To link to this article: http://dx.doi.org/10.1080/09593969200000002

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 Positioning, image and the
marketing of multiple
retailers
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Gary Davies

Abstract

Retailers can compete on price or can insulate themselves from direct price
competition through location. Alternatively retailers can add value to the basic
utility of place through appropriate marketing. One objective of retailer marketing
is argued to be concerned with achieving a differentiated image through
positioning. Attributes that can position a multiple retailer and segment the
customer base are identified and their use illustrated in food retailing through
image mapping. Changes over time in types of attribute, labelled as the ideal set
and the segmenting set, are identified. How it is possible for a retail multiple, who
compete in more than one product sector, to position themselves using some
similar segmenting attributes in each sector is demonstrated using the example of
Marks & Spencer competing in food, ladieswear and menswear.

Keywords

Positioning, store image, marketing, food retailing, UK.

Introduction

The purpose of this paper is to report on the results from a series of

positioning studies analysing retailer marketing conducted during the last
ten years. A longitudinal study of food retailing from 1983 to 1990 is used to
examine trends over time in one sector, and the particular case of Marks &
Spencer in 1988/90 is used to examine the positioning of the same retailer
across three sectors: food, menswear and ladieswear.
The context for the research is the market served by multiple retailers,
where a multiple is defined as trading from ten or more outlets, selling under
the same name and in a similar product field. Since 1900 the share of retail
sales achieved by multiples, excluding co-operatives, has grown from 10 per
cent to over 50 per cent (Davies and Harris 1990). If co-operatives are
 14 G. Davies

included within the definition of multiples, then such large-scale retailers

account for over 60 per cent of sales. The early rise of multiple retailing has
been ascribed to economy of scale, specialism in management functions and
advertising (Jeffreys 1954). Operational factors, such as self-service in
supermarkets, have also been noted (Kirby and Dawson 1979).
The abolition of resale price maintenance in the 1960s freed multiples
from any major constraint on using the cost advantages they had developed
over the independent sector to reduce relative selling prices (McClelland
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1967). Retailers have a number of options for lowering costs: increasing the
size of a store (NED0 1979); the use of part-time staff (Sparks 1987); keen
negotiation with suppliers (Grant 1987); and technology (Ford 1990).
Although many innovations in cost reduction can be readily copied, many
such factors will favour the large-scale operator over the independent
retailer. Retailers of any size can insulate themselves from price competition
through location, particularly in sectors such as food where shoppers appear
to prefer to patronize the nearest outlet, but increased mobility among
shoppers and, more recently, the possibility of saturation (Duke 1991) have
reduced the potential for competitive advantage through location.
By the 1980s, in the views of practitioners, the cost structures of multiple
retailers were often similar (Davis 1982), and low prices even seemed to be
taken for granted by shoppers (Street 1986). Furthermore, the competition
facing many multiples was no longer a disarray of independents but a
number of equally professional large multiples. Multiple retailers now have
little option but to examine non-price means of competition and, even in
food, means that do not rely totally on location.

Retailer marketing

Retailing is fundamentally concerned with offering the customer the utility

of place. Adding value to the utility of a commodity, that is otherwise sold on
price, is one role of marketing. Adding value to the utility of place should
therefore be a central role for retailer marketing but the study of marketing
in retailing, either as a philosophy or as a management tool, remains
underdeveloped (Berry et al. 1990).
Conceptually, the marketing of a retailer is synonymous with the
presentation of a whole business. An immediate issue is whether retailer
marketing as a topic should draw as much from the literature on business
strategy as from that on marketing itself. The two subjects have a number of
concepts in common, including segmentation and positioning (Biggadike
1981; Greenley 1984). Further, in reviewing the application of a number of
the strategic models developed in the early 1980s to retailing, Lees and
Worthington (1989) recommended that retailers should aim for a differenti-
ated position in the consumer's mind. The higher the level of differentiation
in any market, the higher the levels of profitability appear to be (Buzzell and
 Positioning, image and the marketing of multiple retailers 15

Gale 1987). Achieving differentiation is also central to the concept of

branding in marketing (Doyle 1990). Porter (1980) described competitive
strategy as 'positioning a business to maximize the value of the capabilities
that distinguish it from its competitors'. Positioning in the marketing
literature is linked to using image in general and advertising in particular to
locate products in market gaps (Ries and Trout 1981) and to identifying the
dimensions along which customers distinguish between offers (Johar and
Sirgy 1989). Positioning and branding have long been linked in definitions of
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brand image such as that from Joyce (1963), 'The set of associations which a
brand has acquired for an individual'.
Views differ on the practical value of 'branding' as a concept in retailing.
Ryan (1989) sees branding as shaping retailer strategy, overlaying the detail
of the retailer's offer which might vary from store to store. Kreitzman (1986)
in contrast claims that it is often difficult to determine the market position of
a retail brand. However, the retail brand is seen as a product of many
interacting factors (D'Arcy et al. 1989), and Murphy (1990) quotes a director
of Tesco explaining that 'the shop itself, its location, its atmosphere, the
service it offers and the range of goods and prices can become the brand'.
Explained this way, the notion of a retail brand appears allied to that of a
retailer's image, one area of retailer marketing that has received attention.
Early research into retail image looked to identify lists of factors that might
contribute to what Martineau (1958) had described as the 'personality' of the
store. Lindquist (1974) noted that nine types of attribute could be identified
in such studies: those associated with merchandise; service; clientele;
physical facilities; convenience; promotion; atmosphere; institutional factors;
and post-transaction satisfaction.
Most image studies have been limited to one retail sector and to one point
in time, but Hansen and Deutscher (1977) demonstrated that cleanliness
was ranked more highly in grocery shopping than in department stores and
Bates and Gabor (1987) showed how convenience had become more
important from the 1960s to the 1980s. Even the product type being bought
(Cardozo 1974) and the department the product is sold in (McGoldrick
1979) can affect the image the shopper holds of the store. Retail image is
likely therefore to be context specific, changing with the purchase situation.
Within this complexity, the marketing of a multiple retailer, the development
of a retail brand, should aim simultaneously for differentiation, a valued
position in the shopper's mind and a clear image that is to be relevant across
a range of products or departments, when the retailer retails more than one
product area, and, for a multiple, across all outlets in the chain.

A rnethodoloa for studying retailer marketing

The results reported below are part of a project that was begun in the early
1980s. A methodology was required that was reliable but also relevant to the
 16 G. Davies

issue of retailer marketing and in particular to the assessment of

differentiation. The established tradition of image measurement implied a
reliable and relevant perspective. The particular technique of Multidimen-
sional Scaling (MDS) was chosen primarily because its associated method-
ology involves measuring the perceptions of shoppers as to how different
retailers appear to be. MDS is also a multivariate technique that can be used
to produce models of markets that visualize the positioning of competing
retailers. A number of studies of retail sectors had already been conducted
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using MDS (Doyle and Fenwick 1975; Jain and Etgar 1976/7) and others
were soon to be published (Korganokar and El Shenshai 1982; Hooley and
Cook 1983).
The variant of MDS chosen (MINISSA) is a non-metric routine where
the modelling depends only on the rank order of perceived differences
between retailers. Attributes were added to the market model, produced
from MINISSA, using the scaling programme PROFIT (see Coxon 1982).
MDS itself is an analytical technique, rather than a methodology. It
requires a certain form of data but its only value is that it can identifl patterns
in those data that are difficult to perceive otherwise. The normal methodology
is to ask respondents in a market survey to assess how different or similar they
perceive, in this case, retailers to be. Most users ofMDS then ask respondents
to compare products or services with a list of image factors. Advocates of
MDS recommend the inclusion of a hypothetical 'ideal' when modelling
markets as the relative distance from the ideal could indicate preference
(Green et al. 1989). The distance from such an ideal deduced by MDS
modelling has been used to improve the prediction of food retailer patronage
made using a gravity model (Stanley and Sewall 1976, 1978). It was decided
therefore to introduce such an ideal into the research methodology.
The notion of an ideal retailer in any sector suggested a bundle of
attributes that were desired by all those shopping in that sector. Levitt (1980)
argued that all products or services consist of a hierarchy of attributes.
Certain attributes are generic to the needs of customers and others are
expected by them. Levitt described these as 'table stakes', things that a
business has to offer to compete in a market. He differentiated these
attributes from others that augment or extend the product or service offered,
and implied that augmenting factors offer the greater potential for
differentiation. A similar model is described by Kotler (1988), but neither
author offers any empirical support for his models.
In retailing the main generic factor is the utility of place and the expected
factors are all those attributes that every shopper would like to see in an
outlet he or she patronizes. This suggests it would be useful to identify
which attributes constitute the expected product (the ideal retailer) and
which, while relevant to the retail sector, are not expected by all shoppers.
This second group would be likely to augment the core offer of any retailer
choosing to adopt them and, if Levitt were correct, would offer a better
source of differentiation.
 Positioning, image and the marketing of multiple retailers 17

A final decision concerned the level of aggregation in research method for

both shoppers and retailer outlets. Research into image can focus on the
individual shopper and the individual store, the benefit being that links
between motivation, image and patronage can, potentially, be evaluated.
Another option is to examine aggregate shopper attitudes towards individual
stores, arguing that stores might differ within the same retail chain in terms
of image and that competition between stores is local rather than national
from the perspective of the shopper. However, the emergent issue in
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multiple retailing appeared to be whether a national image could be

established to the population as a whole and so the focus for the research
became the image of the multiple as a whole as perceived by a cross-section
of shoppers.

Multiple food retailing in 1990

The results of a national study of food retailing conducted in 1990 are now
presented in some detail to illustrate the methodology used in each of the
studies whose results are discussed later. The main focus of each study
would be to identify the augmenting attributes that differentiated between
competing retailers.
Potential attributes were defined for food retailing by recording and
analysing the results of focus group discussions, analysing the content of
retailer advertising, using word association in semi-depth interviews and
from the results of earlier studies. Lindquist's notion of nine groups of
attribute type was used to ensure that a wide range of attributes was
identified. T o identify the set of attributes that constituted the ideal retailer's
image these potential attributes (some seventy-two in number) were
screened in a survey of 270 food shoppers in the greater Manchester area.
Each respondent was asked to rate each potential attribute on a seven-point
scale with the lowest point labelled 'describes your idea of the ideal food
retailer perfectly' and the highest point labelled 'does not describe your idea
of the ideal food retailer at all'. Some of the words or phrases used, such as
'socially aware', appeared confusing to respondents and the resulting
distribution of marks on the semantic scale appeared random. Others such
as 'sells economy packs' or 'has instore demonstrations' appealed strongly to
no respondents. However, two types of attribute could be usefully identified
from examining histograms of responses as illustrated in Figure 1.
'Hygienic' and 'Good for fresh produce' were rated as describing the ideal
food retailer perfectly by a clear majority of respondents, whereas 'Good for
own label' was seen as ideal by less than half. A more rigorous test of any
differences between the distribution frequencies, the Kolmogorov-Smirnov
non-parametric test (Siege1 and Castellan 1988) shows that the distribution
of responses for 'Good for fresh produce' and 'Hygienic' is not significantly
different at the 99 per cent level whereas the distribution of responses for
 Percentage
1 0 0 1 7 -
-1
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Good for own label

Good for fresh produce

Hygienic
Figure 1 Examples of response patterns for ideal and segmenting attitudes
 Positioning, image and the marketing of multiple retailen 19

'Hygienic' and 'Good for own label' is significantly different (at the 99.5 per
cent level). 'Hygienic' and 'Good for fresh produce' and others with a similar
distribution of responses were labelled as attributes within an ideal set.
Collectively such attributes were taken to define the ideal food retailer.
Attributes such as 'Good for own label' might seem to be of less
importance, but in marketing and positioning terms they could be highly
significant. While the average rating for the attribute is lower than for those
in the ideal set, the attribute still appeals strongly to a minority. Such
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attributes are inherently capable of segmenting the food retail market. A

retailer choosing to position itself against such an attribute would appeal
differentially to those valuing such an attribute. Attributes which received a
similar response pattern to 'Good for own label' were labelled as segmenting
attributes. Collectively they appear to offer a number of options for
segmentation.
Figure 2 presents the ideal and segmenting attribute sets for the 1990
study and, for comparison, those sets defined in similar studies conducted in
1983, 1984, 1985 and 1989. In each case the allocation between attribute
sets is demonstrated by the level of significance of the distribution of
respondent ratings compared to the attribute most often rated as ideal (either
clean or hygienic). In 1989 and 1990 the overall number of attributes is
longer but a number of attributes appear to overlap and cover the same
underlying concept. This represented an attempt to increase the level of
detail possible in the analysis. What are more significant about Figure 2 are
the similarities in and the movements between the two attribute sets over
time.
'Value for money' moved firmly into the ideal set in 1984 and remained
there while 'competitive prices', or a similar description, formed part of the
segmenting set throughout. This reinforces the view reported earlier that
price was less important overall by the 1980s. However, price would still
appeal strongly to a minority. A number of service attributes could be found
in the ideal set in the early 1980s and some, such as 'well trained staff' and
'quality service', moved into the ideal set. By the 1990s service had become
part of what shoppers expected in food retailing.
Figure 2 emphasizes the importance of not relying upon the same list of
attributes to monitor change in a market over time. For example, the
attribute 'sells environmentally sound products' did not emerge in the
qualitative research conducted in the early 1980s but was clearly important
in 1989 when there was widespread concern over the environment in general
and in particular the potential links between certain chlorofluorohydro-
carbons and holes in the ozone layer. It was not mentioned in the qualitative
research in 1990.
 FOODRETAILING 1983 FOOD RETAILING 1984 FOOD RETAILING 1985 FOOD RETAILING 1989 FOOD RETAILING 1990
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ldeal Attributes ldeal Attributes ldeal Attributes ldeal Attributes ldeal Attributes
Clean Clean Clean Hygienic Hygienic
Hygienic Convenient Polite Staff Good Service Quality Service
Fresh Value for Money Value for Money Value for Money Well Trained Staff
High Standards Fast Checkouts Fast Till Service Efficient Checkouts Value for Money
Good Quality Products Quality Products Sells Environmentally Sound Good for Fresh Produce
Long Opening Hours Products Short Queues
Good for Fresh Foods Long Opening Hours Easy to Shop At
Good for Fresh Foods Long Opening Hours
Wide Product Range Quality Products
Good Standards Good for Basics
Good for Basic Products Well Laid Out
Your Choice in Stock
Easy to Find What You Want
Segmenting Attributes Segmenting Attributes Segmenting Attributes Segmenting Attributes Segmenting Attributes
Good Standard+ Quality Products+ Good for Basic Products+ Good Packing Service++ Has Cheerful Staff+
Value for Money+ Competitive Prices+ Steady Prices+ Steady Prices+ Has Well Stocked Shelves+
Good Service+ + Good Customer Well Trained Staff + Knowledgeable Staff+ Carries a Wide Range+
Organized+ Relations Well Laid Out+ Well Laid Out+ Convenient Location+
Wide Range+++ Well Laid Out+ Wide Product Range++ Good Product Information++ Well Presented Staff + +
Convenient+ + Wide Product Range+ + Good for Specialist Food+ + +
Good for Specialist Food+ + Is Good for Own Label+ +
Good for Fresh Foods++ Good for Own Label+++ Sells Speciality Products++
Has Competitive Prices++ Has Good Packing Service++
Caring+++ Sells Interesting Products+
Range of Payment Facilities+ + Supports the Community+++
Carries Special Offers++ Offers Trading Stamps+ ++
Has Easy Car Parking+ Has Competitive Prices+
Innovative Products+ + + Has lnstore Concessions+ ++
Significant Difference over CleanIHygienic
+ 99%
++ 99.5%
+++ 99.9%
Figure 2 Attribute sets for food retailing 1983-90
 Positioning, image and the marketing of multiple retailers 2 1

Market modelling

In a second stage in the methodology a national sample of food shoppers was

surveyed to provide data on the structure of the food retail market in 1990. A
sample of 314 in a quota structured for sex, age and socio-economic group
taken from published data on the relative purchasing of food shoppers
(Harris 1988: Table 1) were asked to assess the similarity between the nine
leading food retailers and the ideal food retailer. They were also asked to
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assess how well the list of segmenting attributes described each retailer. A
seven-point scale was used, as in the earlier survey. A screening question
was used to ensure respondents did shop for food and specific responses
were included only where the individual claimed some knowledge of any
particular store being compared.

Table 1 Sample structure for the 1990 food retailing study (38 sample points were
used throughout England and Wales in June of that year)
Male 113
Female 20 1
SEG ABCl 110
C2 105
DE 90
Age 15/34 123
35/64 119
65+ 62

The similarity data between stores and the ideal in Figure 3 were used to
construct a map of food retailers using MINISSA. One measure of how well
the map represents the data in Figure 3 is Kruskal's stress factor, measured
here at 0.12 for the map of stores in Figure 5, implying a good representation
of the market research data (Kruskal and Wish 1978). Ratings of each
retailer against the attribute list (Figure 4) were overlaid onto this structure
using PROFIT. Those attribute vectors with a correlation coefficient of
greater than 0.5 are included in the final model (Figure 5) so as to identify
those segmenting vectors that can also be used to explain the market
structure. The relative appeal of individual stores can also be judged from
the rating data in Figure 4.
The overall market structure revealed in Figure 5 shows a typical price/
service dimension with the ideal retailer at the service end of the model.
Product, staff and choice associated vectors define the other dimensions
capable of explaining the differentiation between competing stores.
Sainsbury were seen in 1990 to be positioned close to the ideal store
position. A cluster of superstore operators, Asda, Tesco and Safeway,
formed a secondary group. The vectors suggest that Safeway was positioned
 22 G. Davies
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Figure 3 Similarity data

as selling specialist products, a position also associated with Marks &

Spencer, while Asda was seen as being distinguished for carrying a wide
range. Marks & Spencer were differentiated by having well-presented and
cheerful staff and by selling interesting products.
At the other end of the model Kwik Save were seen as far from the ideal
but most closely associated with competitive prices (the distance along the
vector is the measure of association, rather than the proximity of the retailer
to the vector line). The Co-op was most closely associated with offering
trading stamps, as can also be seen from Figure 4, but this was the least
desired attribute of those included in Figure 5. Spar and Gateway were not
positively associated with any attribute included in the model but could be
positioned as not carrying a wide range and not having well-stocked shelves.
While this cannot be taken as proof that Spar and Gateway had no clear
positive image, Gateway was still seeking to forge a single identity from a
number of established names and Spar's traditional advantage of convenience
and long opening hours had probably been eroded by the growth in the
number of multiple outlets and their extending of opening hours.
 TESCO 2.75 3.92 3.07 3.20 2.51 2.84 3.58 5.43 4.37 3.51 2.23 2.71 2.10
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SAINSBURY 2.25 3.04 2.48 2.90 1.56 2.63 3.31 6.17 4.85 3.50 2.28 3.15 2.40
GATEWAY 4.17 4.65 4.45 4.08 3.64 3.97 4.80 5.56 4.97 3.96 3.58 3.48 3.49
ASDA 2.85 4.19 3.56 3.34 3.25 3.50 4.05 5.82 3.85 4.04 2.72 2.89 2.62
SAFEWAY 3.25 3.76 3.73 3.71 3.70 3.64 4.44 6.09 5.05 4.15 2.98 3.57 2.88
KWlK SAVE 5.12 5.43 5.55 4.74 5.50 4.87 5.29 5.68 5.44 4.56 4.50 2.28 4.28
MARKS & SPENCER 1.71 3.33 2.04 2.27 1.69 2.03 3.30 6.44 3.91 3.39 3.37 4.70 3.20
CO-OP 4.50 4.58 4.62 3.91 3.89 4.14 3.99 2.96 4.41 3.40 3.64 3.04 3.89
SPAR 5.35 4.14 6.85 4.20 5.50 4.32 5.59 5.71 5.93 3.62 3.84 3.35 4.50
THE IDEAL STORE 1.58 2.12 2.19 1.88 2.32 2.08 3.06 5.71 4.52 1.66 1.54 1.81 1.60

0 LL
LL
0 IJ:
8a $ 2

0
0
y a y 0
- I c n c n Q c n a L L c n c n c n v , r r
W W Q : Q: a Q :
" I I * I V ) I I I I O

Figure 4 Attribute rating against retailers

 24 G. Davies

\ Kw ik Save

%, Co-op
- apar
a
\ aGatewa
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.""@ ~ r i ~ >
Tesco se
.A\\

Figure 5 Market map of food retailers overlaid with segmenting attributes

Marks & Spencer's image across three sectors

The previous analysis is presented to illustrate how positioning might be

explained through the identification of segmenting attributes, and how
segmenting and ideal-attribute sets can change over time. But what of the
issues facing a retailer competing in more than one sector?
Marks & Spencer are one of the largest of British retailers selling nothing
but their own brand. They rank fifth in terms of market share in food with 5
per cent market share and are prominent if not dominant in clothing with 18
per cent of the UK market (Marks & Spencer 1990). In food, as Figure 5
implies, they have a distinctive offer of 'interesting' and 'specialist' products,
having developed a range of cook-chill ready meals. By 1988 they held some
75 per cent of this one sector (EIU 1989). In 1990 clothing accounted for 49
per cent of turnover and food 38 per cent. While the company had a strong
presence overseas, 86 per cent of turnover came from sales in Britain,
representing over 1 per cent of all that country's total consumer expenditure.
Figures 6 and 7 present the rank order of retailers included in studies of
ladieswear and menswear in 1988 against those attributes found to form the
segmenting set in each sector. Figure 8 abstracts those attributes most
closely associated with Marks & Spencer in both studies for comparison with
similar data from the 1990 food retailing studies and with the respective
ideal sets.
 Positioning, image and the marketing of multiple retailers 25
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Figure 6 Female fashion retailing 1988: rank order of concepts against

retailers

In each sector Marks & Spencer is associated with a different sub-set of

segmenting attributes but service factors appear in each of the three sub-
sets. Attributes associated with staff are prominent, possibly reflecting the
company's human relations policy, described by Tse (1985) as a theory Z
model operating along Japanese lines.
Service seems to act as an umbrella across each sector for Marks &
Spencer. It represents a point of differentiation and a market position
irrespective of the product sold. This is in addition to any specific advantage
the retailer might hold in each product sector and represents the equivalent
of an umbrella brand to the business. But is there any clear link between
expenditure on staff and this image for service?
Marks & Spencer's human relations policy is referred to frequently in the
many histories written about the company. By 1990 over 40 thousand
employees were eligible for profit sharing and a substantial benefits package
 26 G. Dwies

had been developed since a welfare department had first been established in
the 1930s. However the image the company had achieved for service and
quality of employees was, even in 1990, not reflected in the proportion of
turnover spent on the payroll, which at around 10 per cent, was one of the
lowest in British retailing. Neither is there any clear picture of a retailer
operating with a high ratio of employees to customers. Table 2 presents data
comparing the number of paying customers and the number of employees
for Marks & Spencer and similar retailers. Even allowing for any differences
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in the way employees are deployed, Marks & Spencer's reputation for
service does not appear to stem from a relatively high ratio of employees to
customers; other factors must be more important in the creation of such an
image in the customer's mind.

Discussion

Market maps, such as that in Figure 5, can be used to represent the

perceived positioning of competing retailers. Further, the nature of such

I Good to Look Around 2 6 8 3 5 1 1 0 6 9 1010 3 1 3

a: a:
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Z
d cn
W 0 0
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8
3
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Y
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5n :r +n 23 px 5n <a ;: Ew po ~ ~ c
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a ~ I w O w o ~ a : V ) 3 3 o
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Figure 7 Male fashion retailing 1988: rank order of concepts against

retailers
 LADIESWEAR (7988) MENSWEAR (1988) FOOD (1990)
Fair Returns Policy Good Returns Policy Sells Interesting Product
Well Stocked Spacious Sells Speciality Products
Wide Range Well Laid Out Has Cheerful Staff
Spacious Friendly Assistants Has Well Presented Staff
Good for Browsing
After Sales Service
Comfortable
Environment

IDEAL SET IDEAL SET IDEAL SET

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Good Value Stylish Hygienic

Well Displayed Quality Products Quality Service
Merchandise Good Service Well Trained Staff
Helpful Staff Clean Value for Money
Well Trained Staff Value for Money Good for Fresh Produce
Clean Well Trained Staff Short Queues
High Quality Attractive Merchandise Easy to Shop At
Organized Quick Service Long Opening Hours
Good Service Quality Products
Polite Staff Good for Basics

LADIESWEAR MENSWEAR
Sample Size
Quota 15-24
% 25-44
45-64

Figure 8 Segmenting attributes most closely associated with Marks &

Spencer and the ideal set

Table 2 Shopper and employee numbers

Retailer No. ofshoppers No. of empl ees Shoppers per
in 1987 (M)' 1987/88P employee

Marks & Spencer

BHS
Woolworth
Debenhams
House of Fraser
John Lewis
Lewis's
Owen Owen

Sources 1 Gordon Simmons Research Ltd Chain Store Index; 2 Corporate Intelligence Group
The Retail Rankings, 1989 edition.
 28 G. Davies

positioning can be analysed using the concept of an attribute hierarchy

proposed by Levitt (1980). Attributes can be categorized into two broad
groups, those that a substantial majority see as describing the ideal retailer
and those that appeal in this way only to a minority. The first group represent
the cost of credibility in a retail sector, those things that shoppers expect
from a store.
If a retailer, such as Kwik Save, cannot or chooses not to position itself
advantageously against the ideal set of attributes, it must associate itself
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strongly with one or more segmenting attributes, such as low price, to offer
at least some shoppers a valued reason for shopping there. The identification
of segmenting attributes, particularly those that can explain market
structure, represents a way for retailers to identify a market position that
simultaneously segments the market.
What is surprising is that so few of these attributes could be identified in
food retailing that also explained the market structure. Indeed some of the
vectors in Figure 5 seem to duplicate each other, suggesting that as few as
four or five attributes segment the food market. This conclusion may be a
function of the methodology but it could also be due to a lack of creative
marketing thus far by retailers in identifying and promoting differentiated
positions in the market that are clearly valued by shoppers. If this is the case
then, as and when image becomes an important determinant of patronage,
the number of clearly differentiated retailers could become limited by the
number of available positions.
Rather than aim to appeal to a segment of the market, retailers might aim
to move close to the ideal, the position that would appeal to the majority. It is
likely that all large retailers invest in market research and identify what
shoppers desire most. In food this is value for money, a hygienic store, one
that offers fresh produce, makes shopping easier and is run by trained staff.
But if all the leading retailers in a sector choose to concentrate exclusively on
offering shoppers the same bundle of ideal attributes, the consequences are
likely to be an overall reduction in differentiation.
There is some evidence that a number of the leading food retailers are
adopting quite similar strategies. The superstore with a good display of fresh
produce has become the norm. Own label is well developed and sold more
on quality than on price. Customer care training is widely used to promote
service.
In 1990 Sainsbury were positioned closest to the ideal in food retailing.
Tesco appeared to believe that they were better overall than they were
perceived to be and launched a major advertising campaign costing some
E50 million (Sunday Times 1990). Asda had developed a strong non-food
offer which made them appear similar to many Continental hypermarket
retailers but their promotion did not mention the word hypermarket and
instead Asda emphasized its new range of own label products in its attempt
to match Tesco and Sainsbury. In 1990 British food retailers enjoyed net
margins considerably higher than those of similar retailers in other countries
 Positioning, image and the marketing of multiple retailers 29

(Economist 1991). Differentiation insulates against price competition and the

level of differentiation in British food retailing is one possible explanation for
the retailer's relatively high margins. But if all superstores become perceived
to be the same and location less important, then price competition becomes
inevitable and with it the danger of reduced margins.
At the price-led end of the market Kwik Save might have been similarly
tempted to reposition closer to the ideal, while still retaining its association
with competitive prices and with not selling own label. This would explain
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their building new outlets, rather than continuing the practice of locating in
second-hand sites, and expanding in range and a general emphasis on
factors other than price. The danger in such a strategy is that a gap might
open up at the price-led end of the market that could be exploited by the
likes of newcomers Aldi and Netto.
Both Sainsbury and Kwik Save needed to be concerned not only with
their own positioning but with what others were aiming to achieve.
Positioning can be likened to driving a car on a crowded motorway. The
driver needs to know where he or she is going but must also be prepared to
take evasive action against those with conflicting objectives and indeed those
who may not be concentrating on the consequences of where they are
heading.
The rules of the positioning race can be changed by the actions of the
players but the rules also change themselves over time. The attributes that
segment a market will change if one or more attributes become desired by all
shoppers. Having a good fresh produce section was not necessary at one
time, now it is, unless the retailer can offer compensation in the way of low
prices, for example, or be located near to a greengrocer.
Positioning a multi-product business adds further complications. The
table stakes, as Levitt called them, vary with the product sector. Arguably a
retailer can divide its store into departments and market each separately. But
if there is a need to market the store as a coherent entity, then there probably
needs to be some coherence in image across departments. The example of
Marks & Spencer illustrates that such coherence is possible, in their case
because their service in general and their staff in particular were perceived to
be distinctive. If retailers do continue to become less product-specific in the
future, then this issue of coherence will increase in importance, unless
retailers are able to market their departments separately.

Conclusions and implications for further work

Levitt's model of marketing, the concept of the ideal retailer and the
perspective of image positioning, has been used to structure a study of
retailer marketing. The study in turn has provided some empirical support
for Levitt's model. The implications of the study include that food retailers
may be limited in their choice of positioning strategies, as few attributes
 30 G.Davies

could be identified that both explained market structure and segmented the
market. Instead, it appears that food retailers might be aiming to improve
their position against the ideal, thus reducing the overall level of
differentiation.
Figure 9 modifies Levitt's model in the case of retailer marketing and
represents a schematic of the hierarchy of attributes that need to be
considered in positioning. The generic attributes of place that all retailers
must offer are supplemented by the expected attributes, labelled here as the
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ideal set.

Generic

Attributes

Figure 9 Schematic of retailer image and positioning

Retailers can choose to position themselves against the ideal attribute set
or to associate themselves with one or more additional attribute($ that are
not valued highly by every shopper. These attributes inherently segment the
customer base and can often explain the differentiation between competing
retailers.
The marketing of each retailer in a sector could concentrate on
positioning it against the ideal attribute set. However, this could reduce
overall differentiation in the market-place. Idenafling or creating segmenting
attributes in addition to, or as an alternative to, such a strategy would be
desirable.
Both ideal and segmenting attribute sets vary with the product type; they
are context specific. Retailers seeking to market a coherent image across
1 Positioning, image and the marketing of multiple retailers 3 1

~ various product types may benefit by associating themselves with certain

attributes that are common to all the product areas they offer.
Ideally, measures of image should not only be useful in monitoring and
assessing market position, they should also be useful in predicting retailer
performance. Some links have been argued between change in image and
sales volume growth (Brooks 1988) and the level of differentiation and
overall financial performance (Davies and Brooks 1989), but there is little in
the way of firm proof of any dominant association between image and, in
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particular, patronage.
Many models of patronage for food and similar types of retailing have
traditionally relied upon the physical proximity of shopper to the competing
store. Attempts have been made to introduce measures of image to improve
such gravity models (Stanley and Sewall 1976, 1978; Moore 1988), but
image factors are sometimes regarded as merely part of the residual variance
that cannot be explained by measures of physical proximity (Rodgers 1985).
In some retail sectors image is expected to have a more significant impact on
patronage (Breheny 1988) and it was argued earlier in this paper that image
could become more important in determining patronage for all retail sectors.

~
However, image is not a mono variable and some models have already been
proposed that might include image in patronage more realistically (Peterson
and Kerin 1983). The effects of image can also be modelled by multiple
correlation of the impact of individual attributes on patronage (Breheny
I
1988), but what might be equally important is the degree of differentiation
that is caused by association with attributes, rather than just the drawing
power of the individual attributes themselves. Put another way, if shoppers
are faced with three outlets positioned close together, both physically and in
image, they may divide one type of purchase between all three and spend, on
average, more with a fourth retailer positioned closely geographically but
who offers a different proposition. A measure of differentiation could be
useful in modelling patronage, where image is an important variable.
Finally, how image is created and modified needs further research.
Mazursky and Jacoby (1986) argued a cognitive process with the shopper
extracting certain data from the physical store environment to acquire their
image of the store. As to how retailers might create image, the value of
advertising in the marketing of services in general has been questioned by
Gronroos (1984) and Davies (1991) has questioned the value of advertising
in developing as opposed to supporting retail image. In the study reported
here Marks & Spencer's held an image for service that somewhat belied its
expenditure on staff. The same retailer also traditionally spends little on
advertising and none of what it does spend seems to be aimed at promoting an
image for service. The company's image for service may stem more from its
personnel policies; however, by 1991 these policies appeared to be changing.
The annual report referred to the 'culture of the business progressing from
paternalism to partnership'. One retail analyst was quoted as observing that
'we are seeing the transition from a safe jobs for life type of organisation into
 32 G. Davies

a meritocracy' (Thornbull and Summers 1991). In the same year a number

of redundancies were declared and the recruitment of graduates was
deferred. What effect might such changes in employee relations have on an
image for service?
In summary, certain other questions remain on image management. How
best can retailers build image, how can they best sustain it and what options
are there if they lose position? Such an understanding would appear
necessary for retail marketers who seek to add value to the utility of place
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and who prefer not to compete on location or price.

G a y Davies
Post Ofice Counters Professor
of Retailing,
Manchester Business School,
Manchester, UK

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