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Merchandising philosophy sets the guiding principles for all the merchandise decisions that a retailer makes.
Must reflect target market desires, retailer's institutional type, marketplace positioning, defined value chain, supplier capabilities, costs, competitors, product trends and other factors.
An assortment is the selection of merchandise a retailer carries.
Width of assortment refers to the number of distinct goods/services categories (product lines) a retailer carries.
Depth of assortment refers to the variety in any one good/service category a retailer carries.

Costco:
Vast shelf and stock space
Large assortment
Big width and depth of assortment

7/11:
Limited shelf and stock space
Smaller assortment
Narrow width and depth of assortment

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Everyday Low Pricing (EDLP) – Version of customary pricing whereby a retailer strives to sell its goods and services at consistently low prices throughout the selling season.

High/Low Pricing – Prices pitched at market price and discounted for short periods of time.

Cost-Oriented Pricing – A retailer usually computes merchandise and retail operating costs and adds a profit margin to these figures.

Competition-Oriented Pricing – Approach in which a firm sets prices in accordance with competitors’.

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Price, place, product, promotion and people. (5p’s). Definition of each element.

Ex: Zara, H&M, Country Road (make a venn diagram between the 3). Explain what all 5 elements together portray for the image of each brand. What is the overall brand position given by these 5 elements.

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ADVANTAGES for advertising

Ø  introduces a new product in the market

Ø  Expansion of the market

Ø  Increased Sales

Ø  Fights competition

Ø  Enhances good-will

Ø  Educates the consumer

Ø  Elimination of the Middlemen

Ø  Better quality Products

Ø  Supports the Salesmanship

DISADVANTAGES for advertising

§  Cost (expensive)

§  Undermines social values

§  Confuses the buyers

§  Some advertisements may be perceived as ‘bad taste’

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ADVANTAGES FOR PERSONAL SELLING

·       2 WAY COMMUNICATION

·       PERSONAL ATTENTION

·       DETAIL DEMONSTRATION

·       COMPLEMENTARY RO OTHER PROMOTIONAL TOOLS

·       IMMEDIATE FEEDBACK

·       INDIVIDUAL SERVICES

·       FLEXIBILITY

·       CUSTOMER CONFIDENCE

·       IMPROVING IMAGE

DISADVANTAGES FOR PERSONAL SELLING

·       HIGH COST PER ACTION

·       TRAINING COSTS

·       JOB SUITABILITY

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ADVANTAGES FOR SALES PROMOTION

·       Creates differentiation

·       Creates new content and communication opportunities

·       Creates upsell and cross sell opportunities

·       Drives customer decision making

·       Creates word of mouth opportunities

·       Creates training opportunities for your staff

·       Creates company focus on marketing

·       Creates testing opportunities

·       Gross revenue

DISADVANTAGES FOR SALES PROTION

·       Increased price sensitivity

·       Quality Image may become tarnished

·       Merchandising support from dealers in doubtful

·       Short-term orientation

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Retailer Owned Product Brands Examples
- Costco: Kirkland
- BBQ's Galore: Zeigler & Brown
- Woolworths: Woolworths Select
Advantages
- Higher profit margin (No middle man to add extra markup)
- Exclusivity
(Can't buy a Costco pizza at Woolworths)
-  No competition or price matching
(can price match a weber bbq with a ziegler and brown)
- Perception of being better value
(2L milk $2)
- Encourage store loyalty
(Parts for Ziegler BBQ only available at BBQ's Galore)
- No promotion costs built into price from supplier.
Disadvantages:
-  Not as well known or credible.
(Head&Sholders has a better reputation than Woolworths Select shampoo)
- Risk of stock entirely on the retailer.
( Cant send product back to supplier for refund if there is an issue)
- Promotion costs are the responsibility of the retailer.
(McCain has its own ads so Woolworths don't have to.)

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ADVANTAGES FOR PUBLIC RELATIONS •	Information on a product published in a newspaper or magazine may have greater credibility to the public than would an advertisement.•	Lower cost is another advantage since these articles are not paid for, unlike advertising.•	Avoidance of the clutter of advertising and image building opportunities are other •	Crisis management •	DISADVANATGES FOR PUBLIC RELATIONS •	No direct control – unlike advertising, you can’t exactly control how your business is portrayed by the media, when your message will appear, and where it will be placed.•	No guaranteed results – you may spend time and money on writing a press release, getting suitable photography and speaking with journalists, but you can never guarantee your story will be published. This can result in a poor return-on-investment.•	Evaluation – it can be difficult to measure the effectiveness of PR activities. You can count media mentions and published stories, but it’s harder to determine the impact this has on your audience. 

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ADVANTAGES FOR PUBLIC RELATIONS •	Information on a product published in a newspaper or magazine may have greater credibility to the public than would an advertisement.•	Lower cost is another advantage since these articles are not paid for, unlike advertising.•	Avoidance of the clutter of advertising and image building opportunities are other •	Crisis management •	DISADVANATGES FOR PUBLIC RELATIONS •	No direct control – unlike advertising, you can’t exactly control how your business is portrayed by the media, when your message will appear, and where it will be placed.•	No guaranteed results – you may spend time and money on writing a press release, getting suitable photography and speaking with journalists, but you can never guarantee your story will be published. This can result in a poor return-on-investment.•	Evaluation – it can be difficult to measure the effectiveness of PR activities. You can count media mentions and published stories, but it’s harder to determine the impact this has on your audience. 