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Retailing > Test 2: Terminology > Flashcards

Test 2: Terminology Flashcards

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1
Q

Complexity

A

The ease with which consumers can understand and use a new fashion

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2
Q

Cross-Shopping

A

A pattern of buying both premium and low-priced merchandise or patronizing expensive, status-oriented retailers and price-oriented retailers

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3
Q

Everyday Low Pricing (EDLP)

A

) A pricing strategy that stresses continuity of retail prices at a level somewhere between the regular nonsale price and the deep-discount sale price of the retailer’s competitors

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4
Q

Impulse Buying

A

A buying decision made by customers on the spot after seeing the merchandise.

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5
Q

Information Search

A

The stage in the buying process in which a customer seeks additional information to satisfy a need.

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6
Q

Lifestyle

A

Refers to how people live, how they spend their time and money, what activities they pursue, and their attitudes and opinions about the world they live in.

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7
Q

Mutliattribute Attitude Model

A

A model of customer decision making based on the notion that customers see a retailer or a product as a collection of attributes or characteristics. The model can also be used for evaluating a retailer, product, or vendor. The model uses a weighted average score based on the importance of various issues and performance on those issues

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8
Q

Postpurchase Evaluation

A

The evaluation of merchandise or services after the customer has purchased and consumed them.

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9
Q

Satisfaction

A

A post-consumption evaluation of the degree to which a store or product meets or exceeds customer expectations.

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10
Q

Store Advocates

A

Customers who like a store so much that they actively share their positive experiences with friends and family

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11
Q

Gentrification

A

A process in which old buildings are torn down or restored to create new offices, housing developments, and retailers.

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12
Q

Inner city

A

Typically a high-density urban area consisting of apartment buildings populated primarily by ethnic groups.

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13
Q

Main Street

A

The central business district located in the traditional shopping area of smaller towns, or a secondary business district in a suburb or within a larger city.

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14
Q

Accessibility

A

(1) The degree to which customers can easily get into and out of a shopping center; (2) ability of the retailer to deliver the appropriate retail mix to customers in the segment.

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15
Q

Customer Spotting

A

A technique used in trade area analysis that “spots” (locates) residences of customers for a store or shopping center.

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16
Q

Geodemographic Segmentation

A

A market segmentation system that uses both geographic and demographic characteristics to classify consumers.

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17
Q

Utilitarian Needs

A

satisfied when purchases accomplish a specific task

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18
Q

Hedonic Needs

A

satisfied when purchases accomplish a need for entertainment, emotional, and recreational experience as in department stores or specialty stores

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19
Q

Factors Affecting Amount of Information Search

A

Product Characteristic: Complexity, cost
Customer Characteristic: Past experience, perceived risk, time pressure
Market Characteristic: Number of alternative brands

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20
Q

Sources of Information (Internal, External)

A

Internal: Past Experiences, Memory
External: Consumer reports, advertising, word of mouth

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21
Q

How can retailers limit the information search?

A

Information from sales associate, provide an assortment of services, provide good assortments, everyday low pricing, credit

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22
Q

Consideration Set

A

The set of alternatives the customer evaluates when making a selection

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23
Q

Top-of-mind Awareness

A

Getting exposure on search engines like Google, try to be the top of the page; more stores in the same area

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24
Q

Ways to increase chances of store visit after getting into the consideration set

A

Increase Performance Beliefs of Your Store
Decrease Performance Beliefs About Competitor
Increase Importance Weight of Attributes on which You Have an Advantage
Add a New Benefit on which You Excel

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25
Postpurchase Evaluation
Post-consumption evaluation of how well a store or product meets or exceeds customer expectations
26
3 Types of Buying Decisions
Extended Problem Solving: High financial or social risk Limited Problem Solving: Some prior buying experience Habitual Decision Making: Store brand, loyalty
27
Extended Problem Solving and how to engage customers
- Financial, physical, and social risks | - Provide a lot of information and reduce risks for customers
28
Limited Problem Solving and how to engage customers
Involve moderate amounts of effort and time, occurs when customers have had prior experiences with products/services
29
Impulse buying
A common type of limited problem solving, influenced by prominent point-of-purchase sales
30
Habitual Problem Solving and how to engage customers
- Decision involves little to no effort, for purchases that aren't important or for brand loyal consumers - Offer good service and rewards to loyal customers
31
Social factors that influence the buying decision process
Family Reference Group Culture
32
Reference Group
One or more people whom a person uses as a basis of comparison for beliefs, feelings and behaviors
33
Culture
Culture is the meaning, beliefs, morals and values shared by most members of a society
34
4 Criteria for Evaluating Market Segments
Actionable: how to satisfy customer needs in the segment Identifiable: know which customers are in the segment Substantial: Segment must be large enough or have significant buying power to generate profits Reachable: Retailer can target promotions and other elements of the retail mix to the segment
35
Approaches for Segmenting Markets
Geographic, Geo-demographic, Demographic, Buying situations, Benefits, Lifestyle
36
Lifestyle/Psychographics
How people live, how they spend their time and money, what activities they pursue, and their attitudes and opinions about the world in which they live
37
Trade-offs for selecting a particular store location
Size of trade area, occupancy cost, pedestrian and vehicle traffic, restrictions, convenience
38
Freestanding Sites
Location for individual store unconnected to other retailer
39
City/Town Locations
Gentrification of the city/town, low occupancy costs, high pedestrian traffic
40
Central Business District
Traditional downtown business area in a city/town; lots of residents and pedestrian traffic, draws a good crowd during business hours
41
Main Streets
The traditional shopping area in a smaller town or to a secondary business district in a suburb; much like a CBC but lower occupancy costs
42
Inner City
High density urban area that has a higher unemployment and lower median income than the metro area
43
Shopping Center
Group of retail and other commercial establishments that are planned, developed, and owned and managed as a single property (combining many stores in one location)
44
Anchors
One or two major retailers that attract a significant amount of consumers to a shopping center
45
Neighborhood and Community Shopping Center
Attached rows of nonenclosed stores, with on-site parking; offers convenient location and parking, and have low occupancy costs
46
Power Centers
Shopping centers that consist primarily of collections of big-box retail stores (full-line discount stores, off-price, warehouse clubs, and category specialists)
47
Shopping malls
Enclosed, climate-controlled, lighted shopping centers with retail stores (classified by size)
48
Lifestyle Centers
Shopping centers that have an open-air configuration of specialty stores, entertainment, and restaurants
49
Mixed-Use Developments
Combines several different uses into one complex including retail, office, residential, hotel, recreation, or other functions (pedestrian oriented)
50
Outlet Centers
Shopping centers that contain mostly manufacturers' and retailers' outlet stores
51
Theme/Festival Centers
Shopping centers that typically employ a unifying theme carried by the individual shops in their design and merchandise
52
Omnicenters
New shopping center developments that combine enclosed malls, lifestyle centers, and power centers
53
Other Location Opportunities
Airports, Resorts, Store within a Store, Temporary or Pop-Up Stores
54
Matching Location to Retail Strategy
Must be consistent with: the shopping behavior, size of target market, and the retailer's position in its target market
55
3 Types of Consumer Shopping Situations
Convenience shopping: minimizing effort Comparison shopping: know generally what they want, but doesn't have a brand/model preference Specialty shopping: Consumers know what they want
56
Legal Consideration for Location
``` "Above-ground" risks (construction-oriented) Hazardous materials Zoning and Building Codes Signs Licensing Requirements (liquor licenses) ```
57
4 Factors for Evaluating Specific Areas for Locations
1. Strategic Fit with Target Market 2. Economic Conditions (growth of population & employment) 3. Competition 4. Cost of Operating Stores
58
Economies of Scale
Increasing number of stores in an area to help with promotion and distribution
59
Evaluating a Site for a Retail Store
Consider: Characteristics of site, characteristics of the trading area, estimated potential sales that can be generated
60
Cumulative Attraction
A cluster of similar and complementary retailing activities will generally have greater drawing power than isolated stores that engage in the same retailing activities
61
Trade Area
``` A contiguous geographic area that accounts for the majority of a store's sales and customers Primary zone (shopping derives 50 to 70 percent of its customers) Secondary Zone (Customer sales generates 20 to 30 % of site's sales) Tertiary Zone (customers who occasionally shop at the store/center) ```
62
Factors Affecting Size of Trade Area
Accessibility, natural and physical barriers, type of shopping area, type of store, nature of merchandise, assortment, location of alternative sources, competition, parasite stores
63
Parasite Store
One that does not create its own traffic and whose trade area is determined by the dominant retailer
64
Customer Spotting
Process of locating the residences of customers for a store on a map and displaying their positions relative to the store location
65
Geographic Information System
A system of hardware and software used to store, retrieve, map and analyze geographic data along with the operating personnel and the data that goes into the system
66
Tapestry Segment
Classifies US residential neighborhoods by lifestyles and consumer behavior patterns; etc. Metro Renters (young, well-educated, professional, live in large cities, 50K, spend money on themselves)
67
Spending Potential Index
Compares the local average expenditure by product to the national average amount speent
68
Estimating Potential Sales for a Store Site
1. Huff's gravity model 2. Analog Approach 3. Regression Analysis
69
Huff's Gravity Model
probability which a given customer will shop in a particular store or shopping center becomes larger as the size of store or center grows and distance or travel time from customer shrinks
70
Multiple Regression Analysis
Factors affecting the sales of existing stores in a chain will have the same impact upon the stores located at new sites being considered
71
Analog Approach
Retailer describes the site and trade area characteristics for its most successful stores and attempts to find a similar site
72
Types of Leases
1. Percentage: lease based on a % of sales 2. Fixed-Rate: Retailers also typically pay a maintenance fee-based on a percentage of their square footage of leased space
73
Variations of Percentage Leases
Percentage lease with specified maximum - percentage of sales up to a maximum amount. Rewards retailer performance by allowing retailer to hold rent constant above a certain level of sales Percentage lease with specified minimum - retailer must pay a minimum rent no matter how low sales are. Sliding scale - percentage of sales as rent decreases as sales go up.
74
Fixed Rate Leases
Fixed Rate Leases - used by community and neighborhood centers. Retailer pays a fixed amount per month over the life of the lease. Not as popular as percentage leases Graduated Lease - a variation of the fixed rate lease Rent increases by a fixed amount over a specified period of time.
75
Cotenancy Clause
In some retail leases; some require that a certain percentage of a shopping center be leased, while others name specific retailers or types of retailers that are to remain open
76
Prohibited Use Clause
Limits the landlord from leasing to certain tenants
77
Exclusive Use Clause
Prohibits the landlord from leasing to retailers selling competing merchandise

Retailing (3 decks)

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