Customer Service and Sales

Customer Service and Sales

1.1 Define Retail

Retail Industry Overview:

• Defining retail and recognizing the distribution channel

• Describe the retail ecosystem, multichannel retailing and omnichannel retailing.

Retail Industry Overview

• Recognizing the different types of ownership

• Discuss new and future retail capabilities

• Describe the economic impact of retail.

Answer the Following Questions

• If you received a $100 gift card, where would you go and what would you purchase?

• What is your favorite retail store and why?

• What will your next major purchase be and why?

• IF you were to open a retail store, what would you sell, and what would your store be called?

• How do your purchasing habits vary from those of your parents?

What is Retailing?

• Retail is defined as a business that sells products and/or services to consumers.

• A Retailer is a business or person that sells products or services to customers.

• Customers or shoppers, are people who purchase foods or services from a business

• Services are intangible, They can not be physically owned by the customer.

The Goal of Retailing

To provide customers with the merchandise and services they want, when, where, and how they want to purchase them.

Exercise #1

• List as many retailers as you can think of

• Group those retailers into categories based on the types of products they sell

• How many categories did you come up with?

Begin your Retail Profile

• Based on first impressions, are you more interested in a business that sells products or services?

• Why?

• Which type of products and servixes might interest you in a job?

The Distribution Channel

• In order to provide products to consumers

• Retailers are linked in the channel of distribution.

• This allows product to flow from manufactures to the customer.

• The distribution channel is comprised of the following elements:

Reatil Industry Overview

• Manufacturer - Produces the product

• Wholesaler-Buys large quantities of products directly from the Manufacturer, breaks them into small units and sell them to Retailer

• Retailer receives, stores, displays and sells the product to customers

Retail Reimagined

• Retailers want to be where the customer is in both physical and digital environments

• Retailers are constantly evolving in order to make shopping more convenient and fun for customers.

• Retailers enchance the shopping experience by combining technology and human interaction = which improves, price, selection and service

Retail Ecosystems

An interconnected system of approaches for meeting the goal of retailing - which is to provide customers with the merchandise and services they want - when, where and how they want to experience and purchase them.

Retailers Reimaged Ecosystem

• Offer a Network or Physical Store format

• Direct or Phone sale options

• E-commerce sites, Apps, Targeted Marketing

• May be a Multi or Omnichannel Environment

Retail Ecosystems

• Retail is thriving through the growth of commerce and physical store channels

• Globally, commerce will be the largest retail channel in the world by 2021.

• In the United States: Grew 300% between 2018 - 2020

Multichannel Retailing

• Customers can interact with multiple options in their ecosystem.

• Retailers Multiple channels are available to customers to use, but are not necessarily connected to each other.

• Example: A multichannel retailer may carry specific merchandise in their physical stores and offer different goods via E Commerce - Two Distinct Channels.

Omnichannel Retailing

• Similar to Multichannel Retailing - Customers can interact with all available channels of ecosystem

• Omnichannel integrates the channels to create a seamless consumer experience through use of technology.

• Example: If a customers previous purchase indicates they like Nike Shoes, in size 12. The Nike app pushes a notification to the customer when some are available. Customer completes purchase in app and shoes are shipped to their home.

Benefits of Omnichannel Retailing

• Employee with a mobile device greets customer, helps customer find what they are looking for, processes payment on the spot - customer never waits.

• Retailers enable purchase history tracking so customers can easily buy items again.

• Customer uses an app to locate an item in the store and then scans the product code to find specific information about the item.

• If an item is out of stock in the store, A sales associate locates the item elsewhere in the company and ships it directly to the customer.

Exercise #3

• Open a new Google Doc in your exercise folder - Title it Exercise #3 - Retail Channels - How do your buy?

• Answer the following questions.

• Name some products you usually purchase in a store. Which retailers to you choose? Why

• What are some items you have purchased online using a retailers website?

Exercise #3 - con't

• Name some products and services that may be purchased by calling a company's customer service number.

• When you are thinking about buying an item that you have never bought before. What steps do you take before making the purchase? How are you influenced about items to be purchased?

• Describe some ways that you have experienced multi or Omnichannel retailing.

Types of Retail Ownership

Independent: Typically a single store or a small, regional chain - These retailers are able to tailor their offerings to meet the needs of local customers. EXAMPLE: "Mom-and-Pop" stores - Nan and Pap's - Locker22

Types of Retail Ownership

Corporation: A business owned by shareholders through publicly traded stock. These retailers usually have centralized decision making for their multiple store locations. EXAMPLE: Walmart, Kroger, Target

Types of Retail Ownership

Private Ownership: Ownership limited to a single or small number of owner investors. Private businesses can be large companies with many retail locations and centralized business operations. EXAMPLE: Albertsons, Ashley Stewart

Types of Retail Ownership

Franchise: A license is granted to another entity to retail a company's products or services in a particular area; Consistency in the customer experience is critical. EXAMPLE: KFC, Pizza Hut, McDonalds.

My Retail Profile

• Go to your folder - Retail Profile - Open up the document

• Write down your thoughts on:

• Which types of products and/or services might interest you in a job?

• What channels (For example: stores, door-to-door sales, custer service over the phone) would you enjoy working in? Why?

• Which retail ownership model appeals to you? Why?

The Ever - Changing Future of Retail

• Online stores open physical locations and vice versa to increase opportunities to satisfy customer needs

• Artificial intelligence enables voice activated ordering

• Receipts are emailed to customers to save paper and reduce waste.

• Subscription commerce customers receive curated merchandise shipped directly to them on a regular basis.

• Robots perform customer service, logistics and operational efficiency tasks in stores.

Economic Impact of Retail

• Retail is one of America's largest industries

• Approximately 3.8 million retailers

• Near $4 Trillion in total sales

• Leading indicator of job growth, consumer spending, sales and inventory.

Retail Drives the US Economy

• Retailers support 1 in 4 US Jobs

• Support 42 Million employees across the nation

• Retail industry is the largest employer of teenagers - hiring over half of all working teens.

• Ohio: 1,584, 470 Jobs or about 24% of total jobs.

Retail Helps Communities:

• Volunteering

• Joining Civic Organizations - Chamber of Commerce

• Providing Community Education

• Sponsoring events, clubs, projects

• Going green: recycling, water conservation, providing meals

Retail is Global

• Nearly 70% of the top 250 US Retailers have: Stores, e commerce, or support functions in countries around the world.

• Retail is the driver of employment and commerce in other countries.

• EXAMPLE: Alibaba, China's largest online retailer, has over 66,000 full time employees.

Knowledge Check

1.1 Welcome to Retail

1.2 Understanding the Customer

Recognizing the Customer's Mindset

• Customers value different things from Retailers

• This is a result of their Mindset

• People approach purchasing in multiple ways

• Allows retailers to personalize their services, delivering a better customer experience.

Let's Think About your Own Habits

• Do you shop for fun or only when you need something?

• Do you prefer to shop alone or with friends or family?

• Do you research purchase options ahead of time?

• Do you follow retailers on social media?

• Are you loyal to specific brands or stores?

• Are you the first to purchase new technology?

• Do sales promotions, coupons, discouts or advertising influence you to purchase?

Customer Mindsets

As you greet customers and get to know their needs, identifying their mindset helps you tailor the service experience to best fit their expectations.

Comparison Shopper

• Spends time checking products and prices

• Through: Online Sites, Visiting Different stores, Comparing Ads, Getting Opinion of Others

• Can take a long time to make a purchase decision

• These shoppers want the best price

Recreational Shopper

• Views shoping as a fun occasion vs looking for specific items

• Their mindset is adventure

• Enjoys: walking through stores, trying on clothes, testing things, talking to sales associates and learning about new products

• Shopping does not necessarily include making a purchase.

Impulse Buyer

• Mindset allows for quick purchase decisions - usually for inexpensive items with no importance to the buyer.

• Retailers entice shoppers in stores to purchase additional items at checkout

• Online shoppers can also have an impulse mindset.

Innovation / Trend Buyer

• Important to be the first to purchase the newest item.

• They have an early adopter mindset

• Wants to be recognized as a trendsetter.

Follower

• Wants to find out what is trendy before making a purchase.

• More cautious mindset, reluctant to be the first to try a new product

• Look to established brands or previously purchased brands and trust before making a decision

Loyal Customer

• Loyal to specific stores - based on repeated and positive customer experience.

• Spend more money with retailers and brands they love.

Exercise #5

• Open a new Google Doc in your Exercise Folder - Title it: Exercise #5 - What Kind of Customer Are You?

• Type the question and then answer the question:

• Imagine you need to buy a new cell phone. Which type of customer would you be? Describe the purchase experience that you might have.

Exercise #5 cont'd

• Now imagine you need some dish soap. Does your mindset change? If so, in what ways?

• Why is it important to understand customer mindsets?

The Customer Loyalty Life Cycle

Shows the points where customer service can influence purchase decisions. When service is good - customers more likely to return.

Customer Loyalty Life Cycle Steps

• The Customer was a want or need.

• The Customer considers different purchase options.

• The Customer chooses a buying option - in store or online

• The Customer likes or does not like their store experience

• The Customer had a good customer service experience and purchases from the retailer again.

• The Customer tells others about the good experience

Customer Loyalty Life Cycle Disruptions

• Employees deliver poor customer service

• Competitors may offer better products, services or prices

• An online site or app may be difficult for customers to use

• Product quality could be low - customer returns merchandise

• Bad Experience - tell others - a lot of others

Consumer Behavior

Successful retailers don't try to be all things to all people. They identify specific markets who have the ability to buy their products. They do this through analyzing consumer data.

Five Stage Decision Making Process

Steps may be lengthy or completed very quickly. Customers usually progress through each of the following steps.