1. Retail Communications mix

2. Objectives
• The communication program informs the customers
about the retailer as well as the merchandise/services
• Develops repeat visits and customer loyalty
• Have a short and long term effects on retailers
business
• Can be used to create and maintain a strong
differentiation for the retailer and his brands
• Image develops customer loyalty and creates strategic
advantage
• Complements the retailers CRM program

3. USING COMMUNICATIONS PROGRAM TO
DEVELOP BRAND IMAGES AND BRAND
LOYALTY

4. Brand and Brand image
• A distinguishing name or symbol such as a logo that
identifies the products or services offered by the seller and
differentiates those products and services from the
offerings of the competitors. Eg Walgreens Aspirin (private
brand)
• Brand provide value to both customers and retailers
• Convey info to consumers about the nature of the
shopping experience- the retailers mix- they will encounter
when patronizing a retailer
• Affect customers confidence in purchase decisions
• Enhances customer satisfaction with the
merchandise/services they buy. Eg Buying jewelry from
local jeweller than from branded outlet.

5. Brand equity
• Value that brand image offers retailers is brand equity
• Strong brand names affect- customers decision making
process, motivate repeat visits and purchases and build
loyalty
• Enables retailers to charge higher prices and lower
marketing costs
• Customer loyalty to brand arises – from increased
awareness for the brand and emotional ties to it
• Enables retailers to increase their margins.
• High customer loyalty- premium pricing
• Can use to leverage their brands to new retailer concepts
with minimum marketing effort. Eg Toys r us- Babies r us

6. Building brand equity – for private label brands
• Create high level of brand awareness
• Develop favorable associations with the brand name
• Consistently reinforce the image of the brand

7. Brand awareness
• is the ability of a potential customer to recognize or recall that the
brand name is a type of retailer or product/service
• It is the strength of the link b/w the brand name and the type of
merchandise /service in the minds of the customers
• Aided recall: consumers indicate that they know the brand when
the name is presented to them
• TOM awareness: occurs when the consumer mentions a specific
brand name first when they are asked about the type of
retailer/merchandise category/type of service. Eg xerox
• Retailers build TOM awareness by having memorable names,
repeatedly exposing the name through advt and having memorable
symbols
• Sponsorship of well publicized events can provide exposure and
increase awareness

8. Brand awareness

9. Brand associations
• are anything linked to or connected with the brand
name in a consumers memory
• Eg french fries,burgers,Ronald Ms Donald: McDonalds
• Associations that retailers develop for their brand are
as follows
- Merchandise category: to link retailer with the
category of merchandise office supply: staples
- Price/quality: Walmart- low prices
- Specific attributes: with attribute such as convenience
- Lifestyle/activity For eg: Reading books- Crossword

10. Consistent Reinforcement
• The retailers brand image is developed and maintained
through the retailers communication program and other
elements of the communication mix- merchandise
assortment/pricing, store design, website customer service
• to develop a strong association and consistent brand image
– retailer needs to be consistent in portraying the same
message to customers over time and in all elements of
marketing mix
• Through an IMC: A program that integrates all
communications elements to deliver a strong consistent
message.
• For eg TV ad for retailer may emphasize customer service
,where as sales promotional emphasizes low prices- wrong

11. Retailers communicate with customers thro..
• Advertising
• Sales promotion
• Publicity
• Store atmosphere
• Visual merchandising
• Personal selling

12. Methods of communicating with Customers
Advt
Sales promotion
Store
atmosphere
Website
Personal selling
Email
Publicity Word of mouth
IMPERSONAL PERSONAL
PAIDUNPAID

13. Paid Impersonal communication
• Advt: form of paid
communication to
customers using
impersonal mass media
such as
newspapers, TV, radio,di
rect mail and the
internet

14. Paid Impersonal communication
• Sales promotion: offer
extra value and incentives
to customers to visit a
store or purchase
merchandise during a
specific period of time
• Use in store demos, offer
free samples of
merchandise to build
excitement and stimulate
purchases
• Eg fashion shows,cooking
demos

15. Paid Impersonal communication
• Contests: promotional
games of chance
• Eg with major films
and sports events

16. Paid Impersonal communication
• Coupons: offer a
discount on the price of
specific items when
they are purchased at
the store.
• Used by supermarkets
and distributed through
the newspapers

17. Paid Impersonal communication
• Store atmosphere:
Reflects the combination
of stores physical
characteristics such as
architecture, layout,
signs, displays, color,
lighting sounds which
create an image in the
customers mind
• communicates info about
the store services pricing
and merchandise

18. Paid Impersonal communication
• Website: use to build
brand image, inform
customers abt store
locations, special
events, merchandise
availability and sell
merchandise and
services

19. Paid/un paid Personal
Communications
• Personal selling: sales people help customers
• E mail: used to inform customers of new
merchandise, confirm the receipt of an
order, and indicate when an order has been
shipped.
• Publicity: through significant unpaid
presentations about the retailer ,usually a
news story in impersonal media
• Word of mouth : if favorable can affect the
store sales

20. Comparison of communication methods
CONTROL FLEXIBILITY CREDIBILITY COST
Paid Impersonal
Mass media advt High Lowest Lowest Modest
Direct mail Highest High Low Modest
Sales promotion High Low Modest
Store atmosphere High Low Modest
Website High Modest Low Modest
Paid Personal
Sales person Modest Highest Low Highest
Email Highest High Low Low
Unpaid impersonal
Publicity Low Low High Low
Unpaid personal
Word of mouth Low Low High Lowest

21. PLANNING THE RETAIL
COMMUNICATION PROGRAM

22. Steps in developing a retail
communications program
Establish
objectives
• Positioning
• Sales goal
• Communication
objectives
Determine budget
• Marginal
analysis
• Objective and
task
• Rules of thumb
Allocate budget Implement and
evaluate program

23. Establish objectives
• Provides direction for people implementing the program
• a basis for evaluating its effectiveness
• Long term objectives: creating/altering retailers brand image
• Short term objectives: increasing store traffic on holiday weekends
• Communication objectives: are specific goals related to the
communication mix`s effects on customers decision making process
• To effectively implement and evaluate a communications program, the
objectives must be clearly stated in quantitative terms. The TG for the
communication mix needs to be defined ,along with the degree of change
expected and the time period over which the change will be realized
• For eg communication objective for a supermarket can be to increase
from a 45% to 55% within 3 months the % age of customers having a
favorable attitude towards the store.- here the objective is clear and
measurable, indicates the task the program should address. People who
implement this program thus know what they are supposed to accomplish

24. Establish objectives
• The communication objectives and approaches for retailers and vendors
differ
• Some potential conflicts are
- Long term vs short term goals: most commn done by vendors are directed
towards building a long term image of the product. Retailers whereas use
only for short term goals to announce sales and special offers
- Product vs location: When vendors advt their brands, they don’t care
from where the customer buys them, whereas retailer don’t care what
brands customer buys, as long as they buy from them
- Geographic coverage: People tend to shop at stores close to
home/workplace, retailers use local newspaper, TV, radio to target their
communication. Vendors use national media
- Breadth of merchandise: vendors- small no to promote, retailers – wide
choice
- Eg vendor and retailer work together- Walmart- Coppertone tie up

25. Setting the communication budgets
• Many use marginal analysis: is the approach which
retailers should use when making all of the resource
allocation decisions, including the no of locations in a
geographic area, the allocation of merchandise to
stores, the staffing of stores and the floor/shelf space
devoted to merchandise categories
• Marginal analysis is based on the economic principle
that firms should increase communication
expenditures as long as each additional dollar spent
generates more than a dollar of additional contribution

26. Setting the communication budgets
• Objective and task method: determines the
budget required to undertake specific tasks to
accomplish communication objectives
• To use this method ,the retailer first
establishes a set of communication objectives
, and then determines the necessary tasks and
costs
• The total of all costs incurred to undertake
the tasks is the communication budget

27. Objective and task method- Eg
• Objective: Increase the % age of target market
(working women living or working within 10 miles of
our store) who know of our stores location and that it
sells women's business attire from 25% to 50% over
the next 12 months
• Task: 480,30 s radio spots during peak commuting
hours- Rs 12 L
• Task : Sign with store name near entrance to mall: Rs
5000
• Task : Display ad in yellow pages: Rs 10000 and so on
• Total budget:

28. Rule of thumb method
• Using past sales and communication activities to
determine the present communication budget
Methods used
- Affordable budgeting method: sets the communication
budget by determining what money is available after
operating costs and profits are subtracted
- % age of sale method: as a fixed % age of forecasted
sales
- Competitive parity method: the communication
budget is set so that the retailers share of
communication expenses equals its share of market

29. Allocation of Promotional budget
• Retailer decides how much of an budget to
allocate to specific communication elements,
merchandise categories, geographic regions or
long/short term objectives
• Use the principles of marginal analysis

30. IMPLEMENTING RETAIL
ADVERTISING PROGRAMS

31. IMPLEMENTING RETAIL ADVT
PROGRAM
• Developing the advt message
• Choosing the specific media to convey the
message
• Determining the frequency and timing of
message

32. Developing the Advertising message
• Most retail advt messages have short life and
designed for immediate attention
• calls for copywriting style that grabs the
readers attention
• Suggestions for developing a local ad

33. Developing the Advertising message
• Have a dominant
headline: need to
feature the principal
benefit being offered in
the headline along with
a reason why consumer
should act immediately

34. Developing the Advertising message
• Use a dominant
element: large picture
or headline. Photos of
real people, action
photos

35. Developing the Advertising message
• Stick to a simple layout: ads layout should lead
the readers eye through the message from the
headline to the illustrations and then to copy.
Complex elements, decorative borders distract
readers attention from the message

36. Developing the Advertising message
• Provide a specific complete presentation: readers look out for info
that will help them decide whether to visit the store . Ad must contain
all info pertinent to this decision, type of merchandise, brands, price,
sizes and colors

37. Developing the Advertising message
• Use easily recognizable
art elements: people
see countless ads.
Clutter breaking ads are
easily remembered.
Must make it visually
distinct by using
art/design elements

38. Developing the Advertising message
• Give the stores name: name and
location are the two most important
aspects of retail ad.

39. Assistance in advt
- Co-op advt: vendor pays half of the retailers advt,
but dictates some conditions.
• Enables the retailer to increase its advt budget
• Can lead to conflict in retailer-vendors goals
regarding brand placement/store location
- Agencies: to develop ads
- Media companies: sell newspaper space,
broadcast time, advt planning, market research

40. Choosing the effective media
• medium to communicate the message
• Newspaper
• Magazines
• Direct mail
• Radio
• Tv
• billboards
• Internet
• Shopping guides
• Yellow pages

41. Newspaper
• Display ads
• Include preprints or free standing inserts: an
advt which is printed at retailers expense and
then distributed
• useful in targeting retail advt
• offer quick response service
• effectively convey lot of detailed info
• Low cost

42. Magazines
• Local area magazines and regional editions
• High lead time for ad submission

43. Direct mail
• use data collected at POS terminals to target
the advt and sales promotions to specific
customers using direct mail
• can also purchase database
• Message can be personalized
• Costly
• many customers ignore it as junk

44. Television
• Commercials can be placed on
national/regional channels
• called as spots
• use it as an opportunity to communicate
using image and sound
• High production costs
• broadcast time is expensive

45. Radio
• messages can be targeted to a specific
segment of the market
• some audiences are highly loyal of the
announcers
• low cost
• limits attention span

46. Internet
• Banner ads and affiliate programs to generate
awareness
• Websites to provide info about merchandise
and special events
• Emails to target customers and messages

47. Outdoor billboards
• effective vehicles for creating awareness
• Provide limited info to narrow audience

48. Considerations in selecting media
• Coverage: refers to the number of potential
customers in retailers target market that could be
exposed to an advt in a given medium
• Eg Assume size of tgt mkt is 1,00,000 customers.
The local newspaper is distributed to 60% of
customers in tgt mkt,90% of local customers
subscribe to local cable,5% drive past the
billboard. Thus coverage for newspaper would be
60000,TV:90000,billboard: 5000

49. Considerations in selecting media
• Reach: Is the actual no of customers in an tgt
mkt exposed to an advt medium.
• So if 60% of potential customers who receive
the newspaper actually read it,then
newspapers reach would be 36000. (60% of
60000)
• Cost: Cost per thousand or CPM is used to
compare media
• Impact: ads effect on the audience

50. Determining advt frequency and Timing
• Determine how often and when customers
will see the retailers message
• Frequency: how many times a potential
customer is exposed to an ad. For eg for
internet advt: how many times the webpage
with the ad is downloaded
• Timing: ad should appear/slightly precede the
days consumers are most likely to purchase