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1243013504_Chap005(2) - 5-1Market Penetration■Attract...

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Unformatted text preview: 5-1Market Penetration■Attract customers from target market – Walgreens “on every corner”■Get current customer to visit store more often or buy on each visitCross Selling– sales associates in one department sell complimentary merchandise from other departmentsExample: Manicurist sells services plus hand lotion or nail polishExample: Salesperson sells leaf blower directs customer to electricaldepartment to purchase a 100 foot extension cord.5-2Market Expansion■Market expansion growth opportunity involves using the existing retail format in new market segmentsDunkin’ Donuts – new stores (and at gas stations) outside northeasternAbercrombie & Fitch (for college students) opens lower-priced chain Hollister Co. for high school students 5-3Retail Format Development■Develops a new retail format with a different retail mix for the same target market■Multi-channel retailing■UK based TESCO:Tesco Express: small stores located close to where customers live and workTesco Metro: bring convenience to city center location by specializing in ready-to-eat mealsTesco Superstores: traditional storesTesco Extra: one-stop destination with the widest range of food and non-food products5-4Diversification■Introduces a new retail format toward a market segment that is not currently served by the retailer■Related diversification■Unrelated diversification■Vertical integration into wholesaling or manufacturing5-5Global Growth OpportunitiesSteve Cole/Getty Images■Specialty store retailers with strong brand and unique merchandise? McDonald’sStarbucksZaraH & M■Discount and food retailers with deep assortments and low prices?Wal-MartCarrefourRoyal AholdMetro AGWho Is Successful and Who Isn’t?5-6IKEA■Operates 254 stores in 35 countries■Unique, well-designed, functional furniture at low prices for consumers who have sophisticated tastes, but have no intention to spend a lot ■“You do our part. We do our part. Together, we save money.”5-7Why Do Category Killers and Supercenters Succeed Globally?■Developed operating expenses■Scale economies for buying merchandise globally■Unique systems and standardization formats which facilitate control over multiple stores■Understand that consumers are willing to forego service for lower pricesRyan McVay/Getty Images5-8Key to Success in Global Retailing■Globally sustainable competitive advantageLow cost, efficient operations - Wal-Mart, CarrefourStrong private label brands: Starbucks, KFCFashion Reputation - The Gap, Zara,...
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1243013504_Chap005(2) - 5-1Market Penetration■Attract...

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