Retail Marketing Management

1. By
NAVIN RAJ SAROJ
MBA (MARKETING)

2. THE GROWING ROLE OF INFORMATION
TECHNOLOGY IN RETAILING
A visit to any large store will show that information technology (IT) has
become a vital part of retailing. The laser-scanners used in most of the
large stores to read product bar codes, check the details on their
product file, and provide correct price in fractions of a second are
among the most distinctive examples of modern computer technology.

3. Information Technology (IT) refers to the technology
of the production, storage and communication of
information using computers and micro electronics.
It requires “Hardware” (the term used for the
equipment which handles data, using computer
equipment), “Software” (the instructions that control
the way hardware accepts data input, and then
processes, stores, and communicates that data), and
“communications”.

4.  With the increasing globalization of retailing, both in
terms of their points-of-sale and their points-of-supply;
the information technology (IT) spend in the retail
sector has increased significantly. IT plays an
increasingly important role in the management of
complex retail operations.
 Market knowledge, as well as control of data and
information, is key to obtaining a competitive
advantage in the retail sector. Markets are continuing
to grow and become more complex; the simple process
of retailing has started to deploy more advanced retail
information systems to cope with all the transactions
involved.

5.  To increase the company’s ability to respond to the
evolving marketplace through enhanced speed and
flexibility.
 To collect and analyze customer data while enhancing
differentiation.
 To work effectively; retailers need one system working
across stores (or even across national borders) to make
sure the most effective use of stock and improve
business processes.
 Retailers are beginning to notice that technology’s role
is one of an enabler. Essentially, information technology
can speed up processes and deliver cost saving benefits
to the company.

6. All the retailers uses IT to carry out basic functions
including selling items, capturing the sales data by
item, stock control, buying, management reports,
customer information, and managing the finances of
the business.
For IT to provide competitive advantage it needs to
cut costs, differentiate the retailer’s service offer, or
provide innovation in ways that are prized by the
customer.

7. There have been three main ways in which retailers have
used IT, Positioning themselves at the cutting edge of
technological development,’ compared with
manufacturers. These are:
1. Investment in IT along with the Organizational
changes, improved retail logistics, reducing delivery
lead times, resulting in a progressive reduction in
retail inventory holdings,
2. Better information about consumer demand
supported retail policies in own brand, product
development, and the refocusing and redefinition of
many of the most successful firms,
3. Cutting labour cost by effective staff scheduling and by
using more part – time and casual staff.

8. • Point Of Sale. The physical location of a transaction but
usually refers to any device or system used to record the
transaction for the retailer.
• CPOS: A computer-based POS which employs software
to implement the POS functionality
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9. POS System Cash Register
Inventory Control Yes No
Invoicing and Receiving Yes No
Interfacing with Accounting Yes No
Reports Yes No
Enforced accuracy Yes No
Integrated CC handling Yes Limited
General Ledger Yes No
Accounts Payable Yes No
Accounts Receivable Yes No
Preferred by tax consultants Yes No
9

10. • Display / Touch screen
• Cash Drawer
• Receipt Printer
• Bar code scanner (fixed, attached, portable)
• Label / Report printer
• Mag stripe reader
• POS Keyboard
• Scales
• PDA
• Pole Display
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11. Three Types
• Dot Matrix
• Thermal
• InkJet
Link
• Separate unit
• Integrated with other device
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12. • LED
• CCD
• Laser
• Fixed
• Attached
• Portable
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13. A POS keyboard more closely resembles a cash register
key layout and usually has programmable keys. Some
have integrated card swipes.
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14. • Serial Port I/F to your PC
• POS Calculates total
• Desktop units / Built-in units
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15. • Item and price information
• Customer comfort
• Display Advertising
• Serial Port I/F (RS-232)
• Characters per line / number of lines
• LED, Plasma
• Character sets (Chinese?)
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17. Cost and Productivity Benefits:
 Efficiency of the time/transaction speed increases,
 Reduced queuing times,
 Operating cost reductions, e.g. less ticketing,
 Increased accuracy of all aspects of the sales transaction,
 Improved administration/invoices,
 No new keying required,
 Shorter lead times,
 Reduction in stock outs and stock holding,
 Pricing can be change easily and accurately.

18. Marketing Benefits
 Improved Data – effectiveness of promotions, forecasts
of sales, stock records etc.,
 Faster distribution cycle system,
 Improved trading partner relationships,
 Ability to incorporate faster responses to changing
market conditions,
 Consumer benefits from operational efficiencies e.g.
shorter queues,
 Can lead to the building of loyalty schemes and
databases,
 Additional selling space owing to reduced stock
holding.

19.  Automating Processes: It enables to speed up customer service,
 Collecting Data about the customer: Personal Information of
Individual customer can be analyzed, e.g Loyalty card data base,
 Feedback on Marketing decisions: Data can be analyzed to show
quickly the effects of promotions, prices, new products and
packaging changes.
 Communications: stores can be communicate with suppliers to
send documents such as purchase orders, stock and sales
information over third party communications networks.
 Tools to plan the business: sophisticated computer software
packages may help retailers to plan, budget and forecast, to
choose the most successful locations, and to control their
business. Data mining tools can analyze information in a database,
and networks can see changing patterns in complex data.
 Adding value to the Retail Transaction: IT provide assistance for
transactional speed, accuracy, and convenience.

20. Technological enabled shopping: Selling goods over
the Internet is likely to become increasingly
important. Electronic means of selling include the
following:
 Products: range of grocery, clothing and footwear,
music, books, videos, cameras, computer parts etc.
 Services: retail banking, personal insurance,
financial service, stock and shares, travel and
holidays.

21. Retail data capture (or data collection) of every sales transaction
at the point of sale is one of the most important elements of
retail IT, whether data capture occurs through and EPOS
(Electronic Point of Sale) device or is directly entered into
computer using a keyboard. To know exactly how well or badly
the new season’s colours or designs are selling in the first week
enables merchandisers and buyers to turn provisional orders
into firm orders and to make purchases in the other territory.
Data Capture involves three elements on a practical level:-
1. A coding System,
2. A code symbology,
3. The means used to capture the data in a form that can be
fed to the computer.

23.  Coding Systems: The retailer must decide how
merchandise will be coded. The code structure adopted
must uniquely identify every product line to prevent
confusion (and pricing errors).
 Code Symbology: How will this code be represented in
a machine readable form? Retailers who use EAN
(European Article Numbering – 13 digits.
 Data Capture: There are several options available to
the retailer in capturing sales data. Data can also be
captured automatically by using a hand scanner or
some other portable scanning device.
 Communicating Store Data: Stores and depots transmit
EPOS (Electronic Point of Sale) sales data files, financial
transactions data, amount deposited in bank, along
with a range of other data such as staff hours worked,
dispatch information, and stock levels, electronically to
head office computers for processing and analysis.

24. A database is a computer system used to store and
analyze large volumes of data. Data relating to item sales,
customer information and the range of goods bought by
customers can be held on a database and use for
marketing purposes.
Data Mining involves extracting and analyzing different
types of data to direct patterns that are not immediately
obvious and might never be discovered using normal
reporting systems. It helps to know best customers and
their preferences, Price affordability etc.
Business Intelligence Manager’s can easily identify the
competitors brand choice and it’s negligence through
data’s available at retail store.

25. Why
Information
Is
Needed
Marketing
Environment
Strategic
Planning
Customer
Needs
Competition
Strategic
Planning

26. Rapid data communication have been an essential element in the
application of new IT systems to retailing. Computer files with the
data arranged in a specified way are switched between individual
retail stores, depots, head offices and suppliers using a range of
networks including ordinary public telephone lines dedicated
networks and secure public data lines or by satellite link. The most
significant involve computerized ordering and messages providing
sales or promotional information, which help suppliers to know how
and where to keep retailers effectively stocked with merchandise.
There are four main types of systems for business communications
and exchanging data:
1. E-commerce and EDI (Electronic Data Interchange),
2. Trading exchanges and e-tendering,
3. Extranet,
4. Intranet.

27. Sending orders to suppliers and to depots electronically
saves time and avoids the need to re-key order
information. An e-commerce order can be received by a
manufacturer, accepted, and immediately passed into the
distribution system for order picking in the warehouse
and delivery.
EDI (Electronic data interchanges) is a highly structure
variant of e-commerce used mainly for order messages
between large retailers and their suppliers.

28.  Extranet: To control new product
introduction by sending EPOS sale data to
suppliers. Higher any agency by permitting
to track the progress of their orders by
accessing the information over a dedicated
extranet. External communications system
that uses the Internet and is shared by two
or more organizations
 Intranet: an intranet is a formal system to
permit the electronic exchange of business
data within an organization, mostly
between managers and senior staff.
Trading exchanges and e-tendering: an electronic trading
exchange provides a relatively simple method for retailers to
put contracts our to suppliers without the costs and delays of
preparing documents.

29. Electronic retailing to consumers (B2C) was first developed on a
large scale in the 1980s. Electronic delivery systems do not
necessarily require direct human interaction and, as such, they
offer specific advantages. The key underlying reasons behind
electronic retailing are; consumer time poverty, consumers
wanting to have more control over time and place of
transaction, the technology convergence allowing change to
take place and growing experience of the benefits of the
medium.
1. Passive Systems: These are one way media, where the
retailer can decide upon the content and timing of messages
i.e. one way shopping cable networks
2. Interactive Systems: These are two way interaction and
includes the Internet or promotional touch screen booths
and kiosks for items such as airline or holiday bookings.

30. The retailers that undertake electronic commerce can
be classified in three main ways:
1. Virtual retailers : online shopping website,
2. Two – channel retailers : retail stores and online
shopping website
3. Multi – Channel retailers: shops, telephone
ordering, Internet, catalogues and TV.

31. Limitations of the Web
Network Limitations:
Demographic:
Culture:
Future Trends
IT has already had a tremendous effect on the retail sector. A
member of new IT innovation lie in store for shops.
Some of the trends predicted for the future of IT innovation in
retailing are;
 Smart Cards,
 E-cash,
 Tablets,
 Multimedia Kiosks,
 Customer Specific Offers,
 Electronic Body scanners,