Retailing

All the activities directly related to the sale of goods and services to the ultimate
consumer for personal, non-business use.

Retail Merchandising

Retail selling effort that is the principal task of in-store sales personnel through the
use of promotions designed by a manufacturer, such as unique displays, giveaways, or
discount and premium offers. In this case, merchandising is the act of managing and
arranging the merchandise on display in a store so as to promote its sale.

Merchandising Basis of retail merchandising

 Product and merchandising management is key activity in the management of retail

business.

 The primary function of the retailing Is to sell Merchandise.

 One of the most strategic aspects of the retail business is to decide the merchandise
mix and quantity to be purchased .

 Merchandising can be termed as the planning, buying and the selling of

merchandising .

 Define Merchandising as “The analysis, planning, acquisition, handling and control of

merchandise investments of a retail operation.”

 Merchandising is the core of retailing.

 The function of merchandising is an integral part of retailing and also one of the most
challenging functions.

 AMA define “The planning involved in marketing the right merchandise at the right
place at the right time in the right quantities at the right price.”
 Size of organisation

Merchandise to be carried
Organisation Structure

Merchandising function

Types of store

Factors Affecting the Merchandising Function

 Merchandising does not function in isolation.

 It is affected by various factors like the organization structure, the size of the retail
organization and the merchandise to be carried.

 Rarely are any two stores organized in the same way.

 The function of the merchandising is vary from one organization to another.

 Size: The needs of the individual retailers vary from those of large chain store
operation.
Role & Responsibility of Merchandiser

 Planning: Though the merchandising may not be directly involved in the actual
purchase of merchandise.

 They formulate the policies for the areas in which they are responsible.

 Forecasting sale for the forth coming budget period and can estimate the consumer
demand and the impact of changes in the retail environment.

 Directing: Guiding and training buyers as and when the need arises, is also a function
of the merchandiser.

 The buyers have to be guided to take additional markdowns for products which may
not be doing too well in the stores.

 Co-ordinating: Merchandise managers supervise the work of more than one buyer.

 They need to coordinate the buying effort in terms of how well it fits in with the store
image and with the other products being bought by other buyers.

 Controlling: assessing the buyers performance , is a also part of the merchandise

manager’s Job.

 This includes evaluated on the basis of net sale, maintain mark up percentage, gross
margin % and stock turn

VISUAL MERCHANDISING

Visual merchandising is the activity of promoting the sale of goods, especially by their
presentation in retail outlets. This includes combining products, environments, and spaces
into a stimulating and engaging display to encourage the sale of a product or service. It has
become such an important element in retailing that a team effort involving the senior
management, architects, merchandising managers, buyers, the visual merchandising director,
industrial designers, and staff is needed.

Purpose
Retail professionals display to make the shopping experience more comfortable, convenient
and customer friendly by:

 Making it easier for the shopper to locate the desired category and merchandise.
 Making it easier for the shopper to self-select.
 Making it possible for the shopper to co-ordinate & accessorize.
 Informing about the latest fashion trends by highlighting them at strategic locations.
Merchandise presentation refers to most basic ways of presenting merchandise in an orderly,
understandable, ’easy to shop’ and ‘find the product’ format. This easier format is especially
implemented in fast fashion retailers.

Variances
Planogram

A Planogram allows planning of the arrangement of merchandise on a given fixture

configuration to support sales through proper placement of merchandise by Style, Option,
Size, Price points, etc. It also enables a chain of stores to have the same merchandise
displayed in a coherent and similar manner across the chain.

The main purpose is to support ease of applicability to the merchandiser while also increasing
selection & enhancing the merchandise display in a neat and organized manner.

Window Displays

Display windows may communicate style, content, and price point. A window might
combine seasonal and festive points of the year such as Back-to-school, Spring, Summer,
Easter, Christmas, New Year approaching, Diwali, Valentine's Day, Mother's Day,Women's
Day, etc.

Food Merchandising

Restaurants, Grocery Stores, and C-stores are using visual merchandising as a tool to
differentiate themselves in a saturated market. With Whole Foods leading the way, many are
recognizing the impact that good food merchandising can have on sales. If a food
merchandising strategy considers the 5 senses, it will keep customers lingering in the store,
and help them with the buying decision process. Aroma, if pleasant, can be used to help sell
product and visual graphics on the boxes and packaging can make them “look” as good as
they taste. Texture can be utilized to entice customers to touch, and samples are the best form
of food advertising. Especially for large quantity items, the ability to experience the product
before committing to the purchase is critical. Food merchandising should educate customers,
entice them to buy, and create loyalty to the store.
CONSUMER BEHAVIOUR
Consumer behaviour is the study of when, why, how, and where people do or do not buy a
product. It blends elements from psychology, sociology, social anthropology and economics.
It attempts to understand the buyer decision making process, both individually and in groups.
It studies characteristics of individual consumers such as demographics and behavioural
variables in an attempt to understand people's wants. It also tries to assess influences on the
consumer from groups such as family, friends, reference groups, and society in general.

Factors influencing Consumer Behaviour in Retail Marketing

Cultural Factors

Culture is the most basic cause of a person’s wants and behaviour. Growing up, children
learn basic values, perception and wants from the family and other important groups.
Marketing are always trying to spot “cultural shifts” which might point to new products that
might be wanted by customers or to increased demand.

Each culture contains “sub-cultures” – groups of people with share values. Sub-cultures can
include nationalities, religions, racial groups, or groups of people sharing the same
geographical location. Sometimes a sub-culture will create a substantial and distinctive
market segment of its own.

For example, the “youth culture” or “club culture” has quite distinct values and buying
characteristics from the much older “gray generation”

Social Factors

A customer’s buying behaviour is also influenced by social factors, such as the groups to
which the customer belongs and social status.

In a group, several individuals may interact to influence the purchase decision. The typical
roles in such a group decision can be summarised as follows:

Initiator

The person who first suggests or thinks of the idea of buying a particular product or service

Influencer

A person whose view or advice influences the buying decision

Decider

The individual with the power and/or financial authority to make the ultimate choice
regarding which product to buy

Buyer

The person who concludes the transaction

User

The person (or persons) who actually use the product or service

Personal Factors

Consumer’s purchase decisions are also affected by his personal characteristics such as age,
sex, and stag in family life-cycle, education, occupation, income, life-style, his overall
personality and overall self-concept. We shall now discuss some of the influences.
The first factor influencing buyer’s decision is his age. The need for different products and
services changes with age. Babies and children have special needs for products such as milk
powder, baby foods and toys. Young adults need cloths, recreational and educational
facilities, transportation and a host of other age and fashion related consumption needs. For
the convenience of customers organized retail outlets usually create separate racks or area for
the baby products, youth products etc. Sex is another important factor which affects the
behavior of customers in retail marketing. There are certain physiological differences
between men and women which result in their having different consumption needs. Women
need specialized medical facilities for pregnancy and delivery. Their requirement of cloths
and cosmetics is different from that of men. Each gender thus has its own need for specific
products and services. There are some retail shops which are operating exclusively for men
and women like Raymond, Scullers, Innershop etc.

Psychological Factors

Motivation

Motivation is the inward drive we have to get what we need.

Perception
Perception is how you interpret the world around you and make sense of it in your brain. You
do so via stimuli that affect your different senses—sight, hearing, touch, smell, and taste.
How you combine these senses also makes a difference.

Learning

Learning refers to the process by which consumers change their behavior after they gain
information or experience a product

Attitude

Attitudes are “mental positions” or emotional feelings people have about products, services,
companies, ideas, issues, or institutions. Attitudes tend to be enduring, and because they are
based on people’s values and beliefs, they are hard to change.

STAGES OF THE BUYING DECISION PROCESS IN RETAIL MARKETING

Problem Recognition

Information Search

Evaluation of Alternatives

Post purchase Behaviour

Purchase Decision