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Key Issues

What is retail strategy statement


How does it differ from mission and
tactics
Career-search strategy
The building blocks of retail strategy
Process of developing retail strategy
The characteristics of a window of
opportunity
SWOT analysis

Retail Market Strategy 5.1


Strategy vs Tactics

Strategy Tactics
Planning, Direction Implementation
Broad Specific, detailed
Unstructured Structured
Problem solving Problem solving
Creative Analytical
External focus Internal focus
Irregular Regular
Long-term Short-term
Difficult to evaluate Easy to evaluate

Success comes from having a good strategy


& executing it well

Retail Market Strategy 5.2


The Building Blocks of Retail Strategy

Controllable Uncontrollable
What are the
What areVariables
the elements Variables
environmental
of the retail mix?
variables?
Store Location Consumers
Store Format & Layout Competition
Merchandise Management Technology
Pricing Economic Conditions
Communications Seasonality
Legal Restrictions

Retail Market Strategy 5.3


E.g., McDonalds Retail Strategy

What is McDonalds
Target market
Retail format
Bases for competitive advantage
What threats might it face in the future?

Retail Market Strategy 5.4


Developing an Overall Retail Strategy

Whats the
3rdTarget
element
of retail
Market
Retail Marketing Mix: Strategy? Competition & Environment:
Controllable Factors Uncontrollable Factors

Controllable Uncontrollable
Variables Variables
Retail
Store Location Strategy Consumers
Store Format & Layout Competition
Merchandise Management Technology
Pricing Economic Conditions
Communications Seasonality
Legal Restrictions

The main focus:


Bringing harmony between the controllable
variables and the uncontrollable ones.
Uncontrollable variables drive the controllable ones!
Retail Market Strategy 5.5
Which are Sustainable
Competitive Advantages?

Dropping prices
Building a store at the best location
Selling hot merchandise
Increasing advertising
Attracting better sales associates by
paying higher wages
Providing better customer service

Retail Market Strategy 5.6


Sources of Sustainable
Competitive Advantages

More Sustainable Less Sustainable

Retail Market Strategy 5.7


Process of Retail Strategy
Define the
Mission

Situation
Audit

Identify Strategic
Opportunities

Evaluate Strategic
Alternatives

Establish Objectives,
Allocate Resources

Develop a
Retail Mix

Evaluate Performance,
Make Adjustments
Retail Market Strategy 5.8
Situation Analysis
Organizational Mission Statement
Define the
Ownership & Management
Mission
Product Category
SWOT Analysis

Retail Market Strategy 5.9


Form for Mission Statement

A mission statement should include:


The product/service to be delivered
The stores claim (USP)
Other important claims
Identification of the target segment
What the segment will get
What the segment must give up

Retail Market Strategy 5.10


Situation Analysis
Organizational Mission Statement
Define the
Ownership & Management
Mission
Product Category
SWOT Analysis

Retail Market Strategy 5.11


Window of Opportunity
Strong

Weak
High
Window
of
Opportunity

Low
High Low
Retail Market Strategy 5.12
SWOT Analysis
SWOT Analysis is a Strengths Weaknesses
systematic approach Retail Mix plus Retail Mix plus
Management capabilities Management capabilities
to optimizing the fit Financial Resources Financial Resources
between external & Overhead Cost Structure Overhead Cost Structure
Merchandising Capabilities Merchandising Capabilities
internal vars Store Management Capabilities Store Management Capabilities
Store Locations Store Locations
Loyalty of Customers Loyalty of Customers

Opportunities
Consumer Trends
Competitiion
Economic Conditions
Seasonality
Legal Restrictions
Identify the
Threats Strategies
Consumer Trends
Competition
Economic Conditions
here
Seasonality
Legal Restrictions

Retail Market Strategy 5.13


Process of Retail Strategy

Situation
Analysis Sales & Profit

Corporate Satisfaction of Publics


Objectives
Image & Positioning

Identify As a result of the


Consumers Situation Analysis

Retail Market Strategy 5.14


Objectives Statement
Any objective must be clear, concise, and realistic.
Objectives are often based on profit, market share,
growth, etc.

E.g., to get a 15% market share and maintain a


profit margin of 25% by the end of the fiscal year for a
particular store. Or, to increase comp store sales by
15% by end of the year.

Note that each objective must have a time frame.

15%

Retail Market Strategy 5.15


Suggest Objectives for:

Krispy Kreem
Wal-Mart
Burger King

Retail Market Strategy 5.16


Finalizing Retail Strategy

Situation
Analysis Sales & Profit

Corporate Satisfaction of Publics


Objectives
Image & Positioning
Image = how a retailer
Identify wants to be perceived by
Consumers consumers
Positioning = the strategy
Overall to project this image
Strategy

Retail Market Strategy 5.17


Finalizing Retail Strategy
Situation
Analysis

Corporate
Objectives

Identify
Consumers

Overall Retail Mix Variables


Strategy Uncontrollable Variables

Specific Short-term operations


Activities
(Tactics) Response to the
environment

Retail Market Strategy 5.18


Monitoring Retail Strategy
Situation
Analysis

Corporate
Objectives

Identify
Consumers

Overall Retail Mix Vars


Strategy Uncontrollable Vars

Specific Short-term operations


Activities
(Tactics) Response to environ.

Evaluation
Control
(Monitoring) Adjustment

Retail Market Strategy 5.19


E.g., Chevrons Control Mechanisms

Retail Market Strategy 5.20


Developing an Overall Job Strategy

Whats
Yourthe
rd
3 element
Target
of retail
Your Marketing Mix: Jobs
Strategy? Competition & Environment:
Controllable Factors Uncontrollable Factors

Controllable Uncontrollable
Variables Variables
Your education Job
Job history Strategy The economy
Skills Job availability
Interests The competition
Commitment Etc.
Ability to distinguish
yourself

The main focus:


Bringing harmony between the controllable
variables and the uncontrollable ones.
Uncontrollable variables drive the controllable ones!
Retail Market Strategy 5.21
Your Own Product Strategy

Determine your target market


Area of country
Type of company
Type of position
Assess & exploit your competitive advantage
Unique skills
Experience
Knowledge
Develop then present yourself as a desirable
product

Retail Market Strategy 5.22


What Firms Want
% 54
50
49 Specific Business
Concentration
40

33
30 31

Being a Relevant Work


22 24
20 21 Bus. Major 21 Experience
17 16 21 16
16
12 14
GPA
10 10
9
10
8

How Important is this Characteristic? 1


0
Critically Extremely Very Somewhat Not
Retail Market Strategy 5.23
What Firms Want

% Critically
Attribute Important
Integrity 96.7
Strong work ethic 86.9
Professional demeanor 85.2
Initiative 83.6
Emotional maturity 80.3
Self confidence 79.0
Leadership ability 78.7
Personable 62.9
Creativity 55.0

Retail Market Strategy 5.24


E.g., Interpreting a Mission
Action Skill Derived
Knocking on doors Self-motivation, self-discipline,
handling rejection, creativity

Teaching Contacts Training, interpersonal skills, self-


confidence, goal setting

Missionary Training Leadership, time management,


planning, communications

Learning a 2nd Language Learning skills, adaptability to


new concepts, perseverance

Living in a Foreign Culture Ability to work with a new culture,


tolerance
Working Long Hours Dedication & hard work
Retail Market Strategy 5.25
What Is the Interviewer Really Asking?

Tell me about yourself


Why are you interested in this position?
What are your geographical requirements?
What are your salary requirements?
Tell me a story!
Do you have any questions?

Retail Market Strategy 5.26


Selling Yourself
Preparation & Interview

Practice Cover Information


Network Interviews letter/ Interviews
Resume

Self- Placement Alumni InfoTrac,


Testing Resume Evaluation Center Database Lexis/Nexis,
Library Internet

Self- Employer
Knowledge Knowledge

A Career Position
Retail Market Strategy 5.27
Telling the Same Thing

Should we tell the same story to every


interviewer?
Should we customize our presentation?
our resume?
our cover letter?
Why? (Or why not?)
For the same reasons, retailers must focus
their strategy on their target market

Retail Market Strategy 5.28