Wal-Mart retail marketing - Research Paper Example

? Retail marketing Introduction Marketing is one or the most important activities of an organization. It plays a big role in the success of any business organization. The main objective of a business is to make as much profit as they can. In doing so, organizations need to maximize income and at the same time ensure that expenses are minimized as much as possible. The one way that an organization can ensure maximum income is through maximizing its sales revenue. One of the surest ways to ensure that an organization makes maximizing sales is through ensuring good marketing strategies. Marketing is all about convincing potential customers to buy the organization’s products and at the same time ensuring that the current customers are maintained. In addition, marketing strategy should involve strategies to maximize customer satisfaction (Cant et al. 2005). Marketing has become a more significant activity in the global world. In the wake of globalization, international marketing has become common among organizations. Most business organizations are joining the international market in the bid to expand their current markets and at the same time increase their revenues and chances of success. Retailers have also been actively involved in the international marketing. There are a number of retail organizations that are operating in the international market. Considering the scope of operation of a retail store, it's inevitable that a retailer needs to have a very strong strategy and ensure a winning retail mix for it to be successful in the international market (Madaan, 2009). Retailers should establish a retail mix that will enable them gain a competitive advantage so is to enhance their chances of international growth and also enable them to effectively overcome the challenges they are likely to face in their bid to grow internationally. In this essay, an international retail organization will be analysed on the basis of its retail mix. In addition, the challenges the organization faces in its international growth will be evaluated together. The retail store to be analysed is Wal-Mart. It is an organization based in the United States of America and has stores across the United Kingdom. It is one of the biggest retail shops in the world. Retail marketing It is important to understand the concept of retail marketing mix before analysing its elements. Retail mix refers to the features that are involved in the retail marketing strategy planning. The elements that retailers use in order to meet consumer needs and wants are what comprise retail mix (Dennis, Fenech & Merrilees, 2005). The retailers should therefore purpose to blend traits that have the capability to work together and result to maximum customer satisfaction. Considering the importance of retail mix, it is therefore worth for a company to invest considerable time strategizing its retail mix. It is important to note that the more time and efforts a company puts on ensuring maximum customer satisfaction, the more customers it is likely to get. In addition, consumer satisfaction will be significant in ensuring a competitive advantage for the organization. For instance, once customers are satisfied there is a high probability that they will develop loyalty towards the organization and will not move on to the competitor organizations. Further, it will be possible to acquire more new customers. Nothing can feel good for any business person than making their business more profitable as compared to that of their competitors. A good retail mix will ensure this form of success. To develop a good retail mix, the retailer has to consider a number of elements namely; pricing, store layout and design, merchandising, location, communication and customer service. The retail mix for Wal-Mart are analysed below; a) Merchandise range and assortment This is a retail mix element that focuses on the type of goods the organization sells. Each organization has its own target market and target customers (Pradhan, 2010). When deciding on which merchandise to deal with, the most important thing is first to carry out a thorough research of the target market as well as the target customers and define what is good for that market. Once the retailer has identified the market and the customers they are dealing with, they should then come up with a strategy that will help them supply complete merchandise. For instance, if the target customers are the youths, then the retail organization should ensure that they sell all products that the youths are likely to use. This will ensure their maximum satisfaction. Wal-Mart targets a wide range of customers. For that reason, it stocks a diverse and wide variety of goods that serve the wide range of customers. In fact, Wal-Mart is considered a one-stop- shop. In the United Kingdom, Wal-Mart is known for its expansive stores and its ability to stock many products. In fact, when one steps into a Wal-Mart store, they are almost sure to get anything they want. Among the products that are available in Wal-Mart store include electronics, kitchen items, clothing, jewellery, shoes, toys, cosmetics, foodstuffs, beverages as well as furniture. From this variety, it is clear that Wal-Mart targets customers of all ages, all genders and all classes. For instance, young people are likely to buy cloths, footwear and jewellery. The older people who have families are likely to buy furniture, kitchen ware and probably electronics. There are toys for children as well as children wear. In addition, the products are arranged in a manner that makes it easier for a customer to select whatever they want hence making shopping an easy task. Customers would like to spend less time in their shopping. Wal-Mart ensures convenience for customers and saves time for them (Morgan, 2008). Customers might be having other activities to attend to and therefore do not have much time to spend on shopping. In such cases, they will not go to stores where he cannot get what they want. They are likely to go where they will get everything they need and if possible under one roof. This is exactly what Wal-Mart does for its customers. They shop everything under one roof and have the convenience to attend to other activities. It is important for the retailer to understand the assortment before determination of merchandise. Assortment will help to increase the satisfaction consumers get from the organization. In addition, the retailer should ensure variety. Assortment refers to the depth that is available in the merchandise. In other words, assortment is the amount of various items available in a merchandise variety or category. For instance, if the organization is selling mobile phones, it should offer phones from various companies. This is one of the shortcomings of Wal-Mart. The numbers of items available for each category are few. The indication of this is that there are only a few distributors who supply Wal-Mart with items for sale. For instance, the company sells electronics. There is a possibility that there will be many electronics in the stores. However, the electronics are from a few companies or distributors may be like from Sony, Samsung, LG and Philips. This limits the customers with the number of choices available for them. The effect of this is that customers will only have to buy what I available even if they did not want electronics from the available categories or they will have to walk away to other shops so that they can get what they want. Despite the fact that there are electronics the customers wanted, they do not get the brands of their choice. This is an issue that is likely to reduce the level of satisfaction the consumers get from Wal-Mart and is likely to make them move on to competitor retailers. Wal-Mart will lose sales in the process; they will lose customers and a competitive advantage. b) Marketing communications Communication is the process by which a message is passed from one party to another. Communication is very important in any setup. It is an issue that plays a great role in the success of a business organization. In marketing, communication is very crucial. It is the promotional part of marketing that involves 4Ps (promotion, place, price and product). The marketers need to pass the right message to the potential and current customers. The aim of marketing is to convince customers to buy the organization's products. For them to successfully convince customers, they need to have excellent communication skills (Byrom, Medway & Warnaby, 2003). An organization can communicate with their customer using different ways and different media. Therefore, the most important things is to select the right mix that will help it reach as many customers as possible. Selecting the media to use will highly depend on the target customers (Kovacs, 2004). For instance, if most of the organization’s customers are old people, the best way to reach them will be probably through TV, radio or newspaper. Most old people watch TV to catch the news and therefore it is easy to reach them on that media. On the other hand, most young people are available in the social media. Therefore, the organization can reach them through the social media. Wal-Mart has established effective communication channels so as to ensure that its promotional messages reach the right people and at the right time. It uses a number of media to reach its audience. The more people the adverts reach, the more the potential customers it is likely to reach and hence the more the competitive advantage it is going to gain (Gronroos, 2004). Wal-Mart in the UK uses TV to make its advertisement as well as newspapers. It is imperative to note that TV advertisements are likely to reach a wide range of customers from different age groups and classes for very many people watch TV. When making the TV adverts, the company includes the prices for various products as well as the various promotions available. They can reach many potential customers who are watching TV and hence this enhances the effectiveness of their adverts. Newspapers are also usually effective for many people who are looking for places to shop are likely to refer to the newspaper classified part. In addition, the company uses posters and billboards in various places across the UK. The social media is the latest means through which the company advertises is products. It has a fan page that has millions of fans and hence it is sure to reach many potential customers through the social media. Effective marketing communication ensures that Wal-Mart has a competitive advantage over its rivals. It is important to note that the higher the frequency of making the advert, the higher the chances of reaching many people and at the same time convince more people to buy their products (Gronroos, 2004). c) Store layout, design and visual merchandising The way goods are displayed in an organization’s store is very important in attracting customers to buy the products. It is important to display the goods in a manner that is attractive and appealing to the eye (Cao & Pederzoli, 2013). In addition, the display should be in such a manner that it makes it easy for customers to select what they want and hence make it easier for them to shop. Customers do not want to spend much time in the store looking for what they want to buy. In such a case, they are likely to move on to another retailer where they can easily find what they want. Visual merchandising is a way of displaying goods in three dimensions in a manner that they are attractive to customers and in turn will maximize sales (Morgan, 2010). Visual display has the advantage of attracting customers, then engages and motivates them to buy. Prices can be indicated as well as the content and features of the products. At Wal-Mart, the store layout is done in an attractive manner where some products are displayed in a more eminent way. The prices for various products are indicated on the well-arranged shelves. In addition, the products are arranged according to their suppliers. For instance, in the case of refrigerators they are arranged in order of their model and suppliers such that those supplied by Samsung are in one location, those by LG in their separate location and so on. The refrigerators are all found in one section but separately arranged depending on the supplier. It is the same order for all other products. The fact that the displays are attractive and appealing ensures that many customers come in to check on the products. It is not necessarily that when customers come in to check the products that they will buy but it is likely that they will come back to buy in the future. When they check the displays, they will be aware of the prices and the features and hence it will be easy for them to plan to come back in the future to buy the products (Chuang et al. 2011). The design in the UK Wal-Mart stores is such that the space between shelves is big enough to allow customers to move around freely pushing their shopping trolleys. The space avoids collisions with other shoppers ad also enables customers to explore all parts of the store to find what they want. The visual merchandise at Wal-Mart is amazing. Goods are well displayed and attractive with all features and prices indicated. d) Customer service and facilitating services Good customer service is one of the best ways to win their trust and loyalty and hence maintain them. In addition, if an organization offers more services to customers as per their requirements, it can increase the prices for its products and still maintain the customers (Hu?bner, 2011). As the organization offers better services, it can increase prices for its merchandise and in turn make higher profits. Wal-Mart offers excellent service to its customers. Attendants are always there for customers, providing them with the information they need and offering any kind of assistance. They are friendly to customers and always willing to help. The customer care representatives are well distributed within the stores so that customers can get the information they need more efficiently. To further enhance the efficiency of providing assistance, customer care assistance understands the products within the store well so that any information that the customers ask for them they can provide it precisely and quickly. This facilitates the shopping experience and increases the consumer confidence of the organization such that they will be willing to come back to shop again in the future (Singh & Sahay, 2012). e) Store formats and locations Tore formats should be in such a way that they allow accessibility easily and conveniently. Accessibility will give the organization a competitive advantage in that more customers will come to shop since they find it easy to access the stores. Wal-Mart stores around the UK are strategically located such that it is easy to access them from anywhere. It is strategically located at Odhams Industrial Estate, St Albans Rd, Watford, Hertfordshire, United Kingdom. This makes it accessible by motorists along the St Albans road. Motorists can also easily access Wal-Mart from Wellington Road as well as from Bradley Avenue. Its location increases accessibility and hence competitive advantage. f) Pricing strategy and tactics Pricing strategy should help the organization gain a competitive advantage over its rivals (Mills, 2002). The strategy should be such that it is attractive to customers. When coming up with a pricing strategy, it is important to consider the target customers and also the services offered. If the target customers are the youths, then the price should be low since most young people do not have a source of income. Considering the services, better services are accompanied by higher prices. It is important to note that better services increase customer satisfaction and hence worth the additional cost but the cost should be reasonable. Wal-Mart is known for its low priced products (Chuang et al. 2011). Its mission is to improve the living standards of people at the lowest cost possible. Therefore, its pricing strategies are geared towards ensuring best quality at the lowest possible prices. Wal-Mart in the UK offers goods at a relatively lower price as compared to other retail stores in the area. This ensures that customer come in constantly to shop with the aim of saving money. Future Trends The environment in which Wal-Mart operates is dominated by technological advancement. Competitor organizations are exploring technologies that can help them in their businesses. Wal-Mart should therefore be open to changes in technology a factor that will enhance its innovation. It should ensure that its employees are well motivated by providing them with a good working environment and competitive remuneration. Its growth objectives should be dynamic (Wigley & Chiang, 2009). For instance, one of its weaknesses is that it does not provide products from a wide range of suppliers (assortment). For it to expand its consumer base, it should ensure more variety goods in store to ensure that customers are not limited in terms of choice. Its market has a large prospect of growing in the future. To capitalize on this, it should enhance its advertisement strategies by utilizing any media that have the ability to reach a large audience. Market selection should be based on the cost of goods, the variety available and services offered. Wal-Mart targets a wide range of customers. Its goods are mostly cheap and hence it targets mostly low income earners. It should expand the market by targeting the high income earners as well. For instance, the internet is an upcoming Wal-Mart operates in a highly competitive environment. There are other retail customers all of which are trying to expand their market shares and gain competitive advantage. Therefore, Wal-Mart needs to be aware of this and should come with strategies that will help it stay in the competition. Reference List Byrom, J, Medway, D & Warnaby, G. 2003, "Strategic alternatives for small retail businesses in rural areas", Management Research News, Vol. 26 Iss: 7, pp.33 – 49 Cant, M. C., Gerber-Nel, C., Stanford, C., & Nel, D. 2005, Introduction to retailing. Cape Town: Juta Academic. Cao, L, & Pederzoli, D, 2013, "International retailers' strategic responses to institutional environment of emerging market: Multiple case studies in China", International Journal of Retail & Distribution Management, Vol. 41 Iss: 4, pp.289 - 310 Chuang, M, Donegan, J. 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