Some retailers have abandoned ―sales pricing‖ in favor of everyday low pricing (EDLP). EDLP could lead to lower advertising costs, greater pricing stability, a stronger store image of fairness and liability, and higher retail profits. General Motors‘ Saturn division states a low list price for its dealers don‘t bargain. Promotion decision
Retailers use a wide range of promotion tools to generate traffic and purchases. They place ads, run special sales, issue money saving coupons, and run frequent shopper-reward programs, in-store food sampling, and coupons on shelves or at checkout points. Each retailer must use promotion tools that support and reinforce its image positioning. Fine stores will place tasteful full-page ads in magazines such as Vogue and Harper’s. They will carefully train salespeople to greet customers, interpret their need, and handle complains. Off-price retailers will arrange their merchandise to promote the idea of bargains and large savings, while conserving on service and sales assistance. Place decision
Retailers are accustomed to saying that the three keys to success are ―location, location, and location‖. Customers generally choose the nearest bank and gas station. Department-store chains, oil companies, and fast food franchisers exercise great case in selecting locations. The problem breaks down into selecting regions of the country in which to open outlets, then particular cities, and then particular sites.
Retailers can locate their stores in the central business district, a regional shopping center, a community shopping center, a shopping strip, or within a large store. Central business districts: This is the oldest and most heavily trafficked city area, often known as ―downtown.‖ Store and office rents are normally high. Regional shopping centers: These are large suburban malls containing 40-200 stores. They usually draw customers from 5- to 20-mile radius. Typically, malls feature one or two national known anchor stores, such as JCPenney or Lord & Taylor, and a great number of smaller stores, many under franchise operation. Malls are
attractive because of generous parking, one-stop shopping, restaurants, & recreational facilities. Successful malls change high rents and get a share of stores‘ sale. Community shopping centers: These are smaller malls with one anchor store and between 20-40 smaller stores.
Strip malls. These contain a cluster of stores, usually housed in one long building, serving a neighborhood‘s needs for groceries, hardware, laundry, shore repair, and dry cleaning. They usually serve people within a five- to ten-minute driving rang. A location within a larger store: Certain well known retailers McDonald's, Starbucks, Nathan‘s, Dunkin‘ Donuts- locate new, small units as concession space within larger stores or operations, such as airports, schools, Wal-Marts, or department stores. In view of the relationship between high profits and high rents,, retailers must decide on the most advantageous locations for their outlets. They can use a variety of methods to assess location, including traffic counts, surveys of consumer shopping habits, analyses of competitive locations.
Retailers can assess a particular‘s stores sales effectiveness by looking at 4 indicators: (1) number of people passing by on an average day; (2) percentage who entered the store; (3) percentage of those entering who buy; (4) average amount spent per sale.
