LECTURE 3:

RETAIL STRATEGY TWO: PLANNING A

RETAIL FUTURE
Retail Marketing C10RS
WHAT’S HAPPENING
IN RETAIL THIS
WEEK?
Some interesting retail updates:

https://www.cnbc.com/2020/09/24/plastic-pollution-body-shop-will-buy-600
-tons-of-waste-plastic.html

https://www.cnbc.com/2020/09/24/retailers-resume-rent-payments-but-are-
still-fighting-with-landlords.html

https://www.cnbc.com/2020/09/24/unilever-in-data-pilot-to-check-for-defor
estation-in-its-supply-chain.html

https://insideretail.asia/2020/09/25/starbucks-singapore-opens-in-heritage-
building-at-katong-square/

https://www.timeout.com/tokyo/restaurants/the-most-beautiful-starbucks-i
n-japan
What’s Happening in Retail?
• Changing Consumer?
• Retailer Response?
• Retail Structural Change?
• Impact of economic changes on retail?
• The next big retail trends?
Today’s Session
A. What’s Happening?

1. Stages in Strategic planning

2. Re-evaluation of Mission
3. Segmentations
4. Targeting
5. Positioning
6. Summary

C. NEXT WEEK
7. Preparation for next week
8. References
Lecture Three - Objectives
These are the key learning objectives for this weeks lecture:

1. BE ABLE TO 2. UNDERSATND 3. UNDERSTAND 4. UNDERSTAND

EXPLORE THE SEGMENTATION THE PROCESS OF POSITIONING
RE-EVALUATION THEORY TARGETING PROCESS
OF THE • Understand the Understand the • Consider the
BUSINESS segmentation concept of customer means by which
strategy and a brand is
ETHOS: profiling
variables positioned
Consider the
evolution of the
values, mission and
vision
Stages in Strategic Planning
1. VALUES, MISSION & VISION
Where are we now?
How did we get here?
2. INTERNAL ENVIRONMENT
PLANNING AT
CORPORATE OR SINGLE
BUSINESS LEVEL 3. EXTERNAL ENVIRONMENT

4. (RE) EVALUATION OF VALUES, MISSION & VISION Where are we heading?

Where would we like to be?

5. STRATEGIC OPTIONS

How so we get there?

PLANNING AT 6. STRATEGIC OBJECTIVES
OPERATIONAL OR
PRODUCT LEVEL
TACTICAL PLANS

CONTROLS Are we on course?

REVIEWING THE
FINDINGS
• Based on the review of the internal
analysis and external analysis.
• It is important brand prioritise.
• Budgets are not endless and it is
impossible to solve all problems.
• Where do you focus the resources?
04
RE-
STAGE
VALUATION
OF MISSION
Microsoft Examples

2013 Balmer Microsoft was to 2015 Satya Nadella ”

"create a family of devices and ‘To empower every person and every
services for individuals and STRATEGIC
organization on CHOICES
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employees strategic
"deeply care about
taking options
things global
for and making a
difference in livesand
evaluation and organizations
in all corners of the planet.’
selection
Creating new values….

https://www.researchgate.net/publication/
334773849_Analysis_of_corporate_value_statements_an_empirical_study
Creating new mission and vision statements
SEGMENTATION, TARGETING &
POSITIONING
Retail Marketing Strategies
• SEGMENTATING, TARGETING, POSITIONING

SEGMENTATION
Customer focus

TARGETING
Customer profiling

POSITIONING
To attract and retain customers
 S e g m e n t a t i o n , Ta r g e t i n g &
Positioning.

• Practical techniques and tools used in order

to refine and pursue strategic objectives
• How can we achieve objective X?
• Segmentation: Who are the most
attractive customers for us? How can we
give them what they want?
• Targeting/Profiling: How can we better
understand our customers?
• Positioning: How do we position
ourselves against the competition, so
that customers choose us?
SEGMENTATION
 ‘the process of identifying groups of people
who behave in simialr ways to each other, but
somewhat differently than other groups with
the purpose of improving customers’
satisfaction and retailers’ profitability.’’

Blackwell et al., 2006 p41

WHY SEGMENT?
• Too many consumers in the market,
so retailers need to break the market
down
• Focus on specific types and groups
of customer
• Identify and cater for key needs
• Focus on most profitable customers
• Develop reputation and
customer loyalty
A- Segmentation Bases (Shiffman et al 2011)
GEOGRAPHIC
S E G M E N TAT I O N
• Definition – groups consumers by
country or region e.g., UK can be
split into counties or larger
regions.
• Particularly good method for
retailers since their outlets are
based in specific locations.
• Geodemographic segmentation
places people into groups
according to type of neighborhood
in which they live, in the
expectation that consumers who https://www.weforum.org/agenda/2020/08/3d-mapping-global-
population-density?
live there have similar traits. utm_source=facebook&utm_medium=social_scheduler&utm_term=Cities
+and+Urbanization&utm_content=27/09/2020+09:00&fbclid=IwAR013-
A5LOLh-L71kRy-85KxaAmHuxUwhGrxnzz7hJgE70SpGrgzL2xlFDg
 DEMOGRAPHIC
S E G M E N TAT I O N
• Definition – ‘statistics that
measure observable aspects of a
population’ (Solomon 2006)
including:
• Age, gender, occupation,
income, martial status, ethic
group and religion.
• Knowing demographic
characteristics of a given
population can be beneficial to
retailers in various situations -
doe defining target
segmentation or selecting
appropriate store locations.
Socio- Description and Example of Occupation %o
Economic Population
Group
A Higher Managerial, Administrative, Professional 4
Chief Executive, Company Director, Senior Civil Servant, Dental Surgeon With Own
Practice, Bank Manager, MP, Judge, Professor, Newspaper Editor, Restaurateur,
Football Manager
B Intermediate Managerial, Administrative, Technical 22
Fund Manager, Engineer, Lecturer, Chef (With More Than 10 Staff), Secondary
School Teacher, Area Sales Manager, Account Director, Solicitor, Airline Pilot, Doctor

C1 Supervisory, Clerical, Junior Managerial, Skilled Non-Manual 27

Shop Floor Supervisor, Bank Clerk, Receptionist, Primary School Teacher, Dancer,
Model, Staff Nurse, Footballer, Athlete, Journalist, Cabin Crew
C2 Skilled Manual Workers 22
Electrician, Carpenter, Bricklayer, Bus Driver, Hairdresser, Dog Handler, Bespoke Tailor,
Fireman, Boat Builder, Deep-sea Diver
D Semi-skilled And Unskilled Manual Workers 16
Assembly Line Worker, Refuse Collector, Messenger, Au Pair, Security Guard, Dog
Breeder, Barman, Bus Conductor, Supermarket Shelf-stacker
E Casual Labourers, Pensioners, Unemployed, Anyone Living On Basic Benefits 9
PSYCHOGRAPHIC
S E G M E N TAT I O N
• Definition –is dividing your market based
upon consumer personality traits, values,
attitudes, interests, and lifestyles.
• Consumers lifestyle characteristics,
personality and attitudes can be used to
describe then in detail and can be more
appropriate than demographic factors as
consumers in the same age groups and
regions can often have different lifestyles
and values.
• Psychographic segmentation is a
particularly apt method for retailers to use
since consumers will purchase items to
enable them to pursue their chosen
lifestyle.
 B E H AV I O U R A L
S E G M E N TAT I O N
• Definition – relates to the customers’ usage
of a product, e.g. if they are highly loyal
regular or infrequent users of a product or
service.
• A loyal customer may buy most of a certain
type of product at a particular retailer,
whereas others may only shop there
occasionally, thus affecting their patterns of
behaviour.
• Arnold and Reynolds motives for shopping –
• Seeking adventure
• Socialising
• Seeking gratification
• Searching for ideas
• Buying for others
• Searching for value
Shopping Motivation Groups
Shopper Shopper Characteristics
Segments

Minimalists Mainly male, high proportion over 25 years and over, lacking hedonic motivation

Gatherers Mainly male, high proportion under 35 years old, looking for ideas and buying for others.

Providers Mainly female, high proportion 25 years and over, looking for value and buying for others

Enthusiasts Mainly female, high proportion under 25 years old, with hig levels of hedonic motivation

Traditionalists Slightly more females than males, fairly even spread between age groups, with moderate hedonic
motivation

Arnold and Reynolds, 2003

TARGETING AND CUSTOMER PROFILES
Profiling builds an
understanding of
target customers
• Deep and accurate portrait
• Who/Where/What are they?
• What do they like/dislike?
• How do they behave?
• What are their interests?
• What are their aspirations?

Methods of profiling
• Using market research
• Market intelligence (data)
• Socio-economic trends
• Government statistics
• Corporate and consultants’ reports
https://
www.techtarget.
com/
searchcustomere
xperience/tip/
How-to-create-
customer-
profiles-with-
examples
(Osterwaler, & Peigner, 2010)
POSITIONING
‘Positioning can be defined as the compass of
brand identity, directing the corporation to the
place where it can leverage the most powerful
position in the category in which it competes
and establishes a mostly powerful position
within the lives of its potential
consumers/customers.’
(Tadevosyan et al. 2008, p.52)
Influences on Positioning a Brand
Product
Range

Performance
Media Used
and Quality

Customer
Prices
Experience
Brand
Positioning

Word of Distribution
Mouth Channel

Advertising
Customer
and
Profiles
Promotion

Wilson & Gilligan, 2005

Influences on Positioning a Retail Brand
Location

Credit
Store
facilities/returns
size/format
policy

Shopping
Price
experience

Brand
Positioning

Value for
Convenience
money

Quality/service
Added extras
levels

Merchandise
offer
Wilson & Gilligan, 2005
BASIC BRAND POSITIONING MAP
PRICE
Upmarket retailer

Average retailer

QUALITY

Discount or ‘value’ retailer

Source: Goworek & McGoldrick, 2015, p97

Semiotic Positioning Maps
BASIC BRAND POSITIONING MAP
High

Retail
designer
brands
Retail
premium
foods
QUALITY/FASHION
Retailers' mainstream own
Low brands High

Basic
Clothing
Affordable
Generic
Fashion
Groceries

PRICE
Low
Source: Goworek & McGoldrick, 2015, p97
 Importance of Getting it Right
To avoid the pitfalls of:…

CONFUSED OVER-POSITIONING – UNDER-POSITIONING –

• Where customers perceive • Where the message is too
POSITIONING –
products to be expensive and vague and customers have no
• Where customers are unsure real idea of what the
fail to recognise value
of what the brand/company brand/company stands for or
stands for how it differs from
• e.g. Gap misjudgement of competitors.
market in 2001

Newman & Patel (2004) ‘The marketing directions of two fashion

retailers’, European Journal of Marketing, 38 (7), pp. 770-789.
 References
Berman and Evans (2010) Retail Management: a strategic approach, Ch. 18 & 19
Gilbert (1999) Retail Marketing Management, Chapter 9
Omar (1999) Retail Marketing
Kapferer (1997) Strategic Brand Management
McGoldrick (2002) Retail Marketing
Sullivan and Adcock (2002) Retail Marketing
Brassington and Pettit (2006) Principles of Marketing
Wilson and Gilligan (2005) Strategic Marketing Management
Kumar and Steenkamp (2007) Private Label Strategy: How to Meet the Store Brand Challenge
Blythman (2005) Shopped: the shocking power of British supermarkets
Morgan (2008) Visual Merchandising: window and in-store displays for retail
Mulhern, F.J. (1997) ‘Retail Marketing: from distribution to integration’, International Journal of Research in Marketing,
Vol.14, pp.103-124’
Power and Huage (2008) ‘No mans brand – brands, institutions and fashion’, Growth and Change, 39 (1), pp. 123-143
Quinn et al. (2007) ‘Making sense of market segmentation: a fashion retailing case’, European Journal of Marketing, 41
(5/6), pp. 439-465
Kotler (1973) ‘Atmospherics as a marketing tool’,Journal of Retailing, 49(4), pp.48-64
Buttle (1984) ‘Merchandising’, European Journal of Marketing, 18 (6/7), pp. 104-123
Whyatt & Koscheck (2010) ‘Implementing relationship marketing: supermarkets’ perspective’, Marketing Intelligence &
Planning, 28 (5), pp. 582-599
 QUICK QUIZ!
List the key points that you got from
the Reading List this week
Shaw, E. H., (2012), Marketing strategy, From the origin
of the concept to the development of a conceptual
framework, Journal of Historical Research in Marketing,
Vol. 4 No. 1, 2012, pp. 30-55
marketing strategy.pdf

https://qrgo.page.link/btSGK
Reminder for Tutorial 3

- Sample Assessment Available – Where to find?

- Must complete Worksheet from Tutorial 2 to progress to

Activities in Tutorial 3
THANK YOU.
Any questions?