Retail marketing includes all of the ways a business sells its goods and services to customers and makes money. Retail marketing strategies affect almost every part of a business, from getting customers into the store to category management and merchandising that choose products that people in your target market will like. Retail marketing also includes signs, store layout, sales and promotions, pricing strategies, advertising, checkout processes, customer service, experiential marketing events, and almost everything else on a store's sales floor.
A retail marketing mix is comparable to the traditional one, often known as the "four Ps." They include products, pricing, location, and promotion. However, the retail marketing mix includes two additional elements: people and shopper experience. These traits show how important salespeople and other retail workers are and how vital customer engagement is in retail settings.
The correct marketing mix is a must-have differentiator in the increasingly competitive retail industry. There are many ways to test and improve the mix when you have a lot of information about your customers' demographics, their behavior in the store, and their preferences for products and forms of engagement. Some of these strategies are better in-store marketing and merchandising, combining online and offline data, using effective pricing strategies, increasing sales per square foot, and making shopping, in general, a better experience. Retail data could help all kinds of stores, from small "mom-and-pop" shops to big-box stores with stores all over the country, improve their marketing mix.
As previously said, the four pillars of marketing are product, pricing, place, and promotion. People (labor experience management) and presentations (shoppers experience management) make the mix unique to the retail marketing mix.
Product: The product is the merchandise purchased by the customer. An effective product must meet a customer's requirements and expectations or perform the required purpose. A customer can buy a set of merchandise from different product categories as a bundle if placed in proper order or in adjacent areas to suggest or complement each other.
Price: The merchant determines a product's pricing, which is how much money the consumer spends on acquiring it. Price can influence a product's appeal, especially if consumers believe the price is low in comparison to the value it provides.
Placement: The location of the product is referred to as its placement. For example, does a retailer sell a product in its shop, online, or both? Also, some products may be sold in some stores (such as supermarkets) but not others (like department stores).
Promotion: Promotion traditionally refers to the various marketing efforts to increase interest in a product and drive sales. Advertising, public relations, aggressive field marketing, and special deals are all promotional methods (for example, discounts or special offers). Most retailers historically depend on product promotion to bring shoppers into a store or their website in the hope they will buy more products while there. However, this strategy has become less effective as increasing consumer affluence makes the experience more important than the price discount.
People: People refers to retail employees, contractors, or partners who interact with customers on the sale floor. These people might answer product-specific questions or verify product availability and sale price. However, with the growing cost and scarcity of labor, more retailers learn to depend on retail marketing solution technology and product manufacturers to provide more profound product knowledge to the customers in their stores. In some retail settings (for example, store sampling events), people can be directly responsible for converting "just looking" shoppers into purchasing customers.
Presentation: Presentation relates to the experience design aspects of a retail environment. Examples of presentation components include planograms, shelving, furniture, signs, and decor of the retail area to music, smells, and activities conducted to engage shoppers, such as in store demo events in supermarkets or cooking classes in the appliance area of a department store.
Three groups of retail employees are explicitly responsible for the development and execution of retail marketing strategy in most physical stores:
A retail marketing manager uses online and offline marketing tactics to drive awareness and traffic into the company stores. The retail marketing manager may be a sole practitioner or may be part of a team of marketing managers. The retail marketing manager may work alone or as part of a team of marketing professionals. While retail marketing managers may spend time in retail stores, most of their time, they operate at a home or corporate office. If the marketing managers report to the corporate or headquarters office's marketing director or Chief Marketing Officer (CMO), their responsibilities include:
In some cases, the retail marketing manager reports to a director of retail operations (for example, the director for a particular store or the regional director of in-store operations). In such a situation, the retail marketing manager could be responsible for the store guest services, loyalty program execution, and store sampling coordination.
In addition to these duties, the retail marketing manager is involved in retail-specific activities. These activities include in-store displays and promotions, in-store circulars, point-of-sale brochures, and window banners. Furthermore, retail marketing managers are often involved in ads in discount circulars, magazines, and local newspapers. Some retail marketing executives run advertising on local radio and television stations.
Generally speaking, most of their efforts (80%-90%) are involved in promoting the store brand and delivering shoppers into the stores. In contrast, retail marketing managers invest only 10%-20% of their time in shopper engagement and conversion.
That is where merchandising specialists pick up the baton creating and exhibiting items in a retail setting to engage customers and increase sales. The merchandisers construct aesthetically appealing displays highlighting a product's look, features, advantages, and usage.
In general, larger organizations have merchandisers who can collaborate closely with retail marketing teams developing displays that complement the brand's overall image and aims. The essential point to remember is that visual marketing is about more than just making things look great.
It all comes down to presenting them in a way that generates measurable revenue increases.
However, regardless of how many shoppers come to a store and how visually pleasing is the store's environment and displays, the proper selection of merchandise is desirable for the shoppers to make operations profitable. It is the responsibility of the retail organization's Category Managers. Category managers are primary users of large volumes of data produced inside the organization and externally to determine which products sell well (reported by point-of-sale systems), product movement information provided by product manufacturers, brokers, and wholesalers as well as market research addressing customer preference patterns and trends.
When these three brunches of marketing work well together, retailers can enjoy leadership positions in their respective markets and healthy profitability. Most of the time, these teams are not exceptionally well coordinated, even when they report to the same executive - Chief Marketing Officer or CMO. As a result, some very successful parts of retail marketing strategy are not being effectively addressed because they fall between the cracks of these marketing groups' competencies. The examples are a need for partnerships with product manufacturers to generate ongoing experiential marketing events in the stores and a shortage of word of mouth marketing efforts.