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RETAIL RESEARCH

DEFINITION
Retail research is the process of assimilating, absorbing, analyzing and interpreting facts pertaining to the shoppers behavior; so as to implement them by the retailers in order to better understand the psyche of the consumer and create value. Dr. RamKishen Y.

DEFINITION
Hence, retail research is the methodology of studying retail behavior. Retailers need to have a short-term outlook and timely information due to the changing dynamics of the market environment. A retailer needs to be aware of the stores current position in the market and also forecast what customers will demand.

Types of Retail Research


QUANTITATIVE
Retail Audits: consists of a physical inspection of the store operations and an assessment of the documented programs that support the various aspects of the operation. Includes: store layout and visibility management; instore management; customer relations and interface; visual merchandising; ambience and hygiene management; manpower planning and responsibility allocation; sales and cash management

Types of Retail Research


QUANTITATIVE
Retail Process Audit: to examine a stores efficiency in terms of its operating process or reduce the cycle time, hence the retailer can identify ways in which to improve customer service deliveries and performance and thus reduce the turnover time.

Types of Retail Research


QUANTITATIVE
Retail Store Audit: by counting the inventory in the store and recording deliveries to the store since the last visit. Auditor will collect observable information such as shelf prices, display space, the presence of special displays and in-store promotion activities to project and arrive at nationwide and regional estimates of total sales, inventories, etc. Formula: Sales for the period = Beginning inventory + Deliveries to the store Last inventory

Types of Retail Research


QUANTITATIVE
Contents of a Nielson Store Audit Report
Sales Distribution Selling prices Retailer support Media advertising Special analyses

Types of Retail Research


QUANTITATIVE
Consumer Research: to determine and analyze consumer behavior. Consumer research enables the retailer to study and understand consumers needs, wants, and how they make purchase decisions with the goal to improve managerial decision-making

Types of Retail Research


QUALITATIVE TOOLS
To determine consumers perceptions of the store and products. To familiarize with the range and complexity of consumer activity and concerns. To obtain new ideas for promotional campaigns and products that can be tested more thoroughly in larger and more comprehensive studies

Types of Retail Research


QUALITATIVE TOOLS
Ghost Shopping
Ghost shoppers are agents who visit clients retail premises to make an evaluation of the service standard of the store to understand whether it is meeting or failing to meet its customers needs. Ghost shoppers are people who visit stores as anonymous customers, and in the process, help these stores better understand how they can meet customers needs.

Types of Retail Research


QUALITATIVE TOOLS
Ghost Shopping
Companies use mystery shoppers to understand and improve the typical customer experience at each location and throughout the organization. Ghost shopping is useful for studying the customers awareness of a brand and the number of outlets that are selling the product. Obtain information about its competitors in terms of new product launches, market share, new promotions, campaign, etc.

Types of Retail Research


QUALITATIVE TOOLS
Ghost Shopping
Obtain information about the placement of the product in the outlet; whether the product has the right place on the shelf, the visibility of the product, how fast the product of a particular brand is moving and the products impulse buying appeal. Benefits: product placement, point of selling, visibility, customer demand, repurchases, brand recall, and awareness.

Types of Retail Research


QUALITATIVE TOOLS
Ghost Shopping
Tools:
In-person Assessment: it involves analysis based on text-based questions of which a few require narrative responses. Digital video recordings or photographs are included for clarification of the assessment Phone surveys: this involves text-based reporting to describe their experience. Digital audio is used to provide data and tracking and interpreting the moves that the user makes while navigating a retailers site Online Channel Assessment: a special behavioral browser guides users to respond to online assessment objectives by asking appropriate questions, collecting data and tracking and interpreting the moves the user makes while navigating the retail stores site.

Types of Retail Research


QUALITATIVE TOOLS
Ghost Shopping
Variants of ghost shoppers:
Level 1: a mystery telephone call Level 2: a quick purchase with little or no interaction Level 3: initiating a conversation using a script Level 4: The agent has excellent communication skills and knowledge of the product

Types of Retail Research


QUALITATIVE TOOLS
Mall Rats: are individuals who go to malls but dont shop, that is, they are passive and not active customers.
Types:
Rattus Mallus: this common mall rat is generally found in enclosed malls, and can also thrive in a shop-cluster. Normally found in packs, the group has some unique characteristics

Types of Retail Research


QUALITATIVE TOOLS
Types:
Time: normally these mall rats visit malls in the evenings, on weekends and public holidays Feet: these mall rates enjoy cruising and they invariably are on the move. Some covers as much as five kilometers over a few hours in large malls or shopping clusters. Mind: According to their peer groups, these rodents are at the forefront of fashion. They seem to possess a subliminal understanding of which mall or shopping cluster is popular and which is out of fashion Wallet: these mall rats typically spend money on food and low-cost category

Types of Retail Research


QUALITATIVE TOOLS
Focus Group Discussions
8-12 members (usually paid) Homogeneous in terms of demographic and socio-economic factors but have heterogeneous views experience related to the product of issue being discussed 1.5 2 hour sessions Client may sit behind a one-way mirror Qualified moderator Conversation may be video and/or audio-taped or notes may be taken

Types of Retail Research


QUALITATIVE TOOLS
Observation Techniques: research involves researchers following customers as they shop, work and relax at home in order to see how they make decisions, use products, etc (ethnographic). Tools:
Watching what people do Helpful conditions Approaches to observational research Machine observation:

Types of Retail Research


QUALITATIVE TOOLS
Tools:
Machine observation: Traffic counters: time spent and flow into retail store Behavior management: involves examining peoples habit Physiological measurement: EEG (electroencephalogram) GSR (Galvanic skin response) Pupil meters (measure pupil dilation)

Types of Retail Research


QUALITATIVE TOOLS
Observation Techniques Types:
Casual Observation: it takes place when managers monitor variables such as competitive prices and advertising activities, the length or queue of the customers waiting for service, etc. on a continuous basis. Systematic Observation: it can be used as a supplement for another tool. For instance, during home interview, the interviewer may have the opportunity to observe and note down the condition and size of the house and the type of neighborhood and quality of the residence.

STRATEGIC FRAMEWORK FOR RETAIL RESEARCH


Formulate the retail research problem List out research objectives Determine the research design Design data collection methods and forms Analyze and interpret the data Prepare the research report

FUTURE OF RETAIL RESEARCH


SPSS, LISREL, PSPP, R, EVIEW, ETC.

Questions for Practice


Define Retail Research. What are the different types of retail research? Explain the Strategic Framework of retail research by giving suitable examples. Do you think Retail Research will help retailers in finding vital information about shoppers buying behavior? Give Reasons.