The overall objective of retail marketing is creating and developing services and products that meet the specific needs of customers and offering these products at competitive, reasonable prices that will still yield profits.
Businesses must realize that, in retail, the customer lies at the center of any organization’s marketing efforts, determining the overall success of the product or service.
Understand Your Customer
It is imperative that you understand your target customer. If you primarily sell children’s clothing, you should be targeting females in their 20s and 30s. Your business should take the time to know these women: what reaches them, what makes them tick, what they truly need out of your product. Your understanding of your target customer will allow you to communicate better with them, identify their market potential, customize product offers to them according to various market segments and consider their needs during product changes and updates.
A primary goal of retail marketing is understanding the connections between the customer’s lifestyle and spending characteristics and why he chooses one product over another. Using this knowledge, businesses can develop their products with a competitive advantage. This requires research and time as you delve into questions of brand loyalty, quality of product and pricing.
Improve Direct Marketing
Businesses must test to ensure that they are sending the appropriate message to the appropriate households. They also must send this message at the appropriate time using the appropriate media. Your communications must be spot-on, selling the benefits of your product or service in such a way that a prospect becomes a paying customer.
Increase Customer Loyalty
To increase customer loyalty, businesses must develop relationships with customers, continually selling the value of the product in their situation. Never over or under sell; instead, operate with integrity. Matching competitors’ prices, developing special rewards for loyal customers — such as a frequent purchase card with discounts, priority service or personalized offers — and referral programs are effective avenues to increasing customer loyalty.
Make the Product Known
If you know your target customers, understand their needs and have developed the perfect product, you have to get the word out. Using your knowledge of your customers, you must communicate using the right channel. Using the example of children’s clothing, you should advertise your business in parenting and family magazines, on channels featuring children’s programming and in or near toy and book stores.
It is advertising the product or service on communication media. The retailer can advertise on electronic media such as television, radio, mobile, and Internet. Print media such as newspaper, brochures, handbills, product catalogues, are also popular among retailers to publish Ads. Retail advertising enables the retailer to reach out to a large number of people and create awareness among them about the product’s availability.
The success of an Ad on a particular media depends upon the literacy level of the customers, their age and location.
Sales promotion is the communication strategy designed to act directly as an inducement, as added value, or as incentive for the product to the customer. Advertising may create desire to possess the product but sales promotion actually helps conversion to sales.
Sales promotion drives existing customers’ loyalty, attracts new customers, influences customers’ buying behavior, and increases sales. It includes the following techniques −
Point of Purchase (POP) Displays
They are Ads placed near the merchandise to promote the sale where the customer makes buying decision.
Point of Sale (POS) Displays
They are Ads placed near the checkout or billing counters to promote on-the-fly purchase that the customer makes at the last minute.
Some techniques such as Loss Leading (where irrespective of how luxurious the product is, retailer offers steep discount), Markdown (where retailer brings down the prices for wide range of products in the store), and Bundle Pricing (Buy one get one free or Get 3 pay for 1) are used in promotional pricing.
Retailers conduct loyalty program for the customers who make frequent purchase by offering first access to new products, free coupons, or special discounted price on particular days.