Retail strategy is a holistic marketing plan for a product or a service to reach the final retail channel and influence the consumers. This strategy covers everything from what retail channels a product or service will be available in to what should be the price or sales incentive to be given and how to display the product in the shelf.
Retail strategy is developed for product to be distributed through retail outlets. When a product is sold through a retail outlet, a number of factors affect the sale of the product.
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Some of the factors as already mentioned below are:
1. Pricing/discounting of the product
2. Incentive structure followed
3. Promotions planned
4. Placing of the product
5. Display attractiveness
6. Incentive structure for the retailers
7. Overall Consumer Behavior
These are some of the major factors and is not inclusive of all. Strategizing on how to proceed in all these friends to finally influence the consumer to buy your product is the development of retail strategy.
The above mentioned factors are the controllable variables of a retail strategy as shown in the picture. Apart from planning for these a retail strategy should also take into account the uncontrollable factors like seasonality, legal restrictions, economic conditions etc. in order for the strategy to be effective.
One of the examples of the retail strategy can be placement of the product at the retail channel. Many times when we go to a retail store, just before the billing counter, we see products like gums, chocolates and other products with smaller SKUs which can just be picked while the customer is waiting at the billing counter.
This is a part of retail strategy and helps both the brands as well as the retail chain by driving sales even at the end of the journey.
Hence, this concludes the definition of Retail Strategy along with its overview.
This article has been researched & authored by the Business Concepts Team. It has been reviewed & published by the MBA Skool Team. The content on MBA Skool has been created for educational & academic purpose only.
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