Retail Pricing

Chapter 3

Copyright © 2003 by Nelson, a division of Thomson Canada Limited.

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Factors Determining Price
Price is the factor which is the only source for revenue.
Store policies

Target market & demand

Retail Price

Competitors price

Economic Conditions

Chapter 3

Copyright © 2003 by Nelson, a division of Thomson Canada Limited.

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3-3 .Retail Pricing Policies & Strategies Cost oriented Demand oriented Competition oriented Chapter 3 Copyright © 2003 by Nelson. a division of Thomson Canada Limited.

Chapter 3 Copyright © 2003 by Nelson. 3-4 .Cost Oriented Pricing Retail price=cost +mark up Cost=retail price-mark up Mark up=retail price-cost Difference between the selling price and the cost is the mark up price. a division of Thomson Canada Limited.

leader pricing:selling one or few items in deep discounts 5.200. .300 6.price bundling:package pricing 4.odd-pricing:99.market skimming.199 8.Pricing Strategies 1.every day low pricing 7.single pricing 9.high price 2.market penetration-expansionistic pricing-low price 3. two shirts Rs.multi-unit pricing:one shirt Rs. a division of Thomson Canada Limited.multiple pricing:discount on bulk purchase 3-5 Chapter 3 Copyright © 2003 by Nelson.

3-6 . a division of Thomson Canada Limited.psychographics.geographic.STP Approach Segmentation:demographic.lifestyle Target market:whom to cater to Positioning: positioning the product in the mind of the prospect Chapter 3 Copyright © 2003 by Nelson.

Chapter 3 Copyright © 2003 by Nelson.Retail Image Retail image has to be created keeping the target audience in mind-the kind of environment and the services thy would like to get. a division of Thomson Canada Limited. 3-7 .

3-8 .Retail Communication Mix Sales promotion Public relations advertising Retail Communication mix Direct marketing Personal selling Chapter 3 Copyright © 2003 by Nelson. a division of Thomson Canada Limited.

Creating about the product or store Create a desire to want a product To communicate the store policies on various issues Posters and leaflets Mediums like radio.Advertising 1. 2. Chapter 3 Copyright © 2003 by Nelson. 3-9 . 3. 5. 4.television.outdoor hoarding.internet etc. a division of Thomson Canada Limited.

a division of Thomson Canada Limited. 3-10 .Sales Promotion To induce trial purchases To encourage repeat purchase To encourage larger purchases Tools: Coupons Contests Demonstrations samples Frequent shopper programmes Chapter 3 Copyright © 2003 by Nelson.

3-11 . Stimulus-Response 2.Personal Selling Basic Types of Selling Approaches 1. a division of Thomson Canada Limited. Need Satisfaction 3. Problem-Solution Chapter 3 Copyright © 2003 by Nelson.

Skills Required Pre-Interaction Interaction Post-Interaction Skills: • Pre call Planning Skills: •Relating •Need discovery •Advocating •Closing Skills: •Supporting •Implementing •Dealing with dissatisfaction •Enhancing the relationship 3-12 Chapter 3 Copyright © 2003 by Nelson.Personal Selling The Selling Process . . a division of Thomson Canada Limited.

a division of Thomson Canada Limited. 3-13 .Personal Selling Pre-Call Planning What do I want to accomplish? What do I know about the prospect? Where can I find the information? What am I going to say? Chapter 3 Copyright © 2003 by Nelson.

4. 6. 3. a division of Thomson Canada Limited. 2. 3-14 . Chapter 3 Reducing Relationship Anxiety Needs Discovery Anticipating Buyer Questions Understanding Buyer Motives Advocating/Handling Concerns Closing the Sale Copyright © 2003 by Nelson. 5.Personal Selling Interaction Phase 1.

process. views. 3-15 . dress appropriately Know your product/service. acquaintances Intent Chapter 3 Reveal purpose of call. a division Thomson Canada Limited. third-party references Competence Commonality Common interests.Personal Selling The Approach: Reducing Relationship Anxiety Propriety Show buyer respect. and payoff to the of buyer Copyright © 2003 by Nelson.

Point of display Promotional signs and interior displays. a division of Thomson Canada Limited.often located at the point of sale or alongside display of merchandise. Chapter 3 Copyright © 2003 by Nelson. 3-16 .

a division of Thomson Canada Limited.Retail store design and visual merchandising Store design: •Store Image •Store Atmosphere •Store Themes Chapter 3 Copyright © 2003 by Nelson. 3-17 .

promotional graphics Chapter 3 Copyright © 2003 by Nelson.campaign graphics. Aesthetics:size.lighting.Interior Store Design Space planning:the amount of space allocated within the store for the merchandise.texture(feel within the store) Fixtures Flooring and ceiling Lighting Graphics and Signages-theme graphics.colour. a division of Thomson Canada Limited. Specific locations for impulse products etc. 3-18 . Store atmospherics:visual communication.music. The location of various departments The location of various products within the deptt.colour.

a division of Thomson Canada Limited.Types of Layout Grid layout: Mostly used in supermarket and discount stores while one area of display is along the walls of the store and the other merchandise is displayed in the parallel manner Racetrack layout:loop layout. 3-19 . Chapter 3 Copyright © 2003 by Nelson. Department stores Freeform layout:it allows free movement .often used in Department stores to encourage the people browse the shop.

a division of Thomson Canada Limited.Planogram Helps to determine the location within a store Diagrams of how to exhibit selections of merchandise within a store How displays has to be done Chapter 3 Copyright © 2003 by Nelson. 3-20 .

store windows and floor displays.fixtures.signs. Chapter 3 Copyright © 2003 by Nelson.systematic.logical and intelligent way of putting stock on the floor SKU planning.space design. a division of Thomson Canada Limited. 3-21 . mannequins etc.Visual Merchandising Termed as the orderly.

Methods of Display Colour dominance Co-ordinated presentation Presentation of price Chapter 3 Copyright © 2003 by Nelson. 3-22 . a division of Thomson Canada Limited.