l i a t e R MAY 2014
FASHION RETAIL MARKETING BA FASHION MARKETING EMILE PESTININKAITE STUDENT NO : 425681796
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Contents 1. INTRODUCTION
3 - 4
2. KEY STRATEGIES 5
3. FLAGSHIP STORE
6 4. SITE SELECTION 7 - 8
5. STORE ENVIRONMENT 9 6. STORE DESIGN AND VISUAL MERCHANDISING 10 - 11
8. TECHNOLOGY IN-STORE 12
9. FUTURE GROWTH 13
10. MERCHANDISE PLAN 14
11. CONCLUSION 15 12. BIBLIOGRAPHY 16-17 13. APPENDIX 18-20
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INTRODUCTION
The purpose of this report is to introduce the reader to a conceptual brand ‘Cruxx’ and its’ future internationalization plans. It talks about the different methods to enter the market and underpins which method could be used as an entry point to enter a new market. The chosen market for a short term internationalization is United Arab Emirates and a method to open this emerging market is direct export by establishing a flagship store in Masdar City. The report also covers the basics plan of visual merchandising of the store, store environment and merchandising plan. The primary and secondary researches have been taken in order to evaluate what would work the best for the retailer and the report was written using references of various academic journals, academic books, online articles, videos, magazine articles and adapting different theories.
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Cruxx is a middle-market fashion retailer that uses only organic and natural materials in order to compliment and promote a healthy lifestyle. Cruxx aim is to deliver trendy and long lasting fashion to women that care about an environment and health. It is an innovative, sustainable and elegant brand which differentiates it from other sustainable fashion brands. The idea of delivering elegant and fashionable pieces, concentrating on the clothing shapes and fitting rather than colors and patterns are the factors that help the brand to address and attract its’ target consumer - healthy lifestyle and fashion lover woman. Cruxx is a UK based brand which targets upper middle-class and middle class women with the good signs to expand into other countries and continents. The mission statement of the retailer is to lead the global middle market in the demand for organic materials offering a healthy lifestyle option brand which will be reached by expanding into emerging markets. By evaluating a research on expending markets, the UEA market was defined as the most suitable for the Cruxx to expand as a short term plan. UAE is one of the fastest growing and dynamic economical blocks in the world with positively changing consumer demand in women’s wear from the Cruxx brand perspective
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KEY STRATEGIES There are several different mechanisms for internationalization: Acquisition, or Merger Franchise Internal, or organic expansion Joint venture or non-controlling interest As its’ future plans, brand Cruxx is going to enter other emerging markets such as Brazil, China, Africa and other European countries, using the strategies of franchising as a medium term plan, and possibly wholesaling as a long term plan. ( Moore, CM, 2007 [9]) There are several factors that influent the retailer to growth internationally. One of them is to take advantage of opening windows in new developing and fast growing markets such as UAE. This action would help the brand to maintain being innovative within the organic clothing market and to create stronger and lasting value as a global brand ‘Brand value matters because by investing in brands, a company can create a sustainable financial advantage’ Joanna Seddon 2008. Secondly, the international expansion will have positive effects on retailer’s revenue factor. The third motivation to grow is to be ahead by the competitors and become the first organic UK based brand entering the UAE market. To enter a new market, different brands use different strategies such as wholesaling, franchising, licensing and etc. More and more fashion brands now choose to be more independent and retail oriented by going into new markets with setting up the flagship stores or branded chains or stores. (Moore, CM, 2010 [8] )
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FLAGSHIP STORE There is always a risk involved by entering new markets. To avoid the high risk and huge possible profit loss, Cruxx choses the strategy to enter the market by opening one flagship store in one country, which will bring the brand considerably low amount of operating profit and market potential, but at the same time low amount of risk. The strategy that brand will use for entering a new market is a direct exporting strategy. (Appendix 1) The vehicle of entering a new market will be a flagship store. This method of a market entry is the most suitable for the brand because it offers greater control of overseas operation, is less costly and less risky, although it will require more financial commitment. Therefore, the international markets entry methods such as Joint Venture, franchising and wholesaling offer much less control of overseas market (Moore, CM, 2010). [8]. It is crucial for a young retailer to have a full control of the shops performing internationally in direction of spreading the brands name around the globe with a good reputation. After opening a Flagship store, Cruxx will be able to open more stores around the UAE market. The first Flagship store will be positioned in the Masdar City to outline Cruxx identity and unique selling proposition and also will be used as testing grounds for innovation and experimentation. [10]
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The store will be targeting middle-income shoppers and those who consider shopping in flagship stores as a hobby. The aim is not only to gain market share within different foreign markets and expand across the globe, but also to strengthen the branding and the values that Cruxx stands for. Masdar City is an emerging global clean-technology cluster that inspires innovation and empowers business. Cruxx is a fashion brand which is known for its usage of natural organic fabrics as well as innovations in store in terms of newest technology. The mega trend of going organic and being environmental friendly is something that more and more businesses and people get involved into As an example ‘the organic food segment is growing at an estimated 20% annually: from a $23 billion market in 2002, global organic food sales had more than doubled to $52 billion by 2008.’ Green Industry Analysis 2014 - Cost & Trends. 2014. This shows that people get more concerned about their health as well as being sustainable which motivates them into buying organic apparel. As all flagship stores differed in their design and physicality; they must have the best locations and the most prestigious address. The Masdar city is already the most sustainable city on earth and in the future will be a capital of sustainable technologies and trends. The flagship store serves as a model for presenting the brand lifestyle concept. (Moore, CM, 2010. [8])
SITE SELECTION
? w o r g o t e wher Retail area Masdar City
Shopping Mall
Masdar retail area
‘The social and political changes that have continued resonate in the wake of the 2011 ‘Arab Spring’ may lead to greater freedom within the region for citizens, consumers and organizations to push sustainability as a concept further up social, environmental and economic agendas’ Frank-Martin Belz 2012 As a City of Masdar is still being built and is expected to fully operate in 2020, it is crucial to understand the economic, political and environmental situation of the region, which includes consumers shopping habits, the demand and expectations. Under a revised design, public transport within the city will rely on methods other than the PRTs. Masdar will instead use a mix of electric vehicles and other clean-energy vehicles for mass transit inside the city. The majority of private vehicles will be restricted to parking lots along the city’s perimeter. Abu Dhabi’s existing light rail and metro line will connect Masdar City’s centre with the greater metropolitan area. Easy and alternative access will bring around more tourists which are possible customers of Cruxx brand.
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‘Knowledge gained from meeting Masdar City’s sustainability targets can be used at a retailer’s other operations, thereby saving money, enhancing its green credentials and helping save the planet. Companies that have already signed up to operate from Masdar City include: Caribou Coffee, health insurance provider Daman, telecom provider Etisalat, Sumo Sushi, express delivery company Aramex, Omeir Travel, Organic Foods & Cafe and National Bank of Abu Dhabi.’ Retail in Masdar City 2011 The Masdar city offers a quick and easy way to set-up for new foreign businesses : • easy set-up with a one-stop shop for registration, government relations and visa processing • 100% foreign ownership • Zero percent import tariffs • Zero percent taxes on companies and individuals • No restrictions on capital movements or profits Although Masdar is a small city with an area of 6km2 , the shop will still be located in a city centre which is considered as a primary location. The retail type is a local store. Although the Masdar city offers to set up in the Shopping mall, Cruxx is going to open a stand-alone shop in the retail are of the Masdar city which is located in the City Center and will have a highest footfall. As a city of Masdar is designed into areas, the only possible location is a retail area to open the shop and it is located in a city center. World Retail Congress, Empik Media & Fashion president and chief executive Maciej Dyjas said: “You need to be very humble and understand the markets where you are going.” Cruxx will follow the rule of ‘thinking locally and acting globally’ which is one of the keys for international retailer’s success according to Mango executive vice-president international expansion Isak Halfon ,Retail well 2014.
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Cruxx will continue to follow British fashion trends, but it will take the lifestyle of local UAE women lifestyle into account. A contemporary woman of UAE values the price and quality. Given the relatively short life cycle fashion products have, most consumers do not believe in spending ridiculous prices on them as they possess no stability due to changing trends. Meanwhile, Cruxx offers a timeless fashion products with a twist of luxury at affordable middle-market price which UAE women is looking for (FERNANDES, C, 2013[2] ) Although the main shopping destination in UAE is Dubai (Central place) (Appendix 2) the nearest place that offers required goods and services, the chosen site of Masdar City (Spatial interaction) (Appendix 2) is more suitable for the brand Shoppers, in other words, customers may bypass the nearest centre offering the desired merchandise for a more distant but better-appointed destination, an alternative destination which offers alternative goods and unforgettable shopping experience. (Brown, S, 2006 [1]) Setting up a shop in Masdar city will as well strengthen the values of Cruxx such as being alternative, eco-friendly and sustainable. For a residence this will be a central chopping location. Masdar City's population is expected to grow from 1,000 to 4,000 in 2014 and it is predicted that the city's population will hit 10,000 in three to five years.
STORE ENVIRONMENT
The store environment can be defined as external to the retailer’s target consumer. The environment can influence the behavior of consumers and their decisions. It is crucial for the retailer to satisfy it’s customer needs by providing the environment where the customer will feel welcome. Cruxx target consumer is someone who is maintaining healthy lifestyle and as an outcome of it has chosen to buy into organically made clothes. In terms of needs of people maintaining healthy lifestyle are most likely to feel the need of security, be well respected by society and have self-respect ( Appendix 3 )followed by sense of belonging and keeping warm relations with others are their prior needs. By having an engaged sales assistants and creating a cosy atmosphere Cruxx will be providing an environment that the target customers are looking for. The interior of the store will be minimalistic and clean, so as the products of Cruxx.
A lot of an empty space and clearly laidout products on the shop floor will let the customer to brows easily as well as will give a feeling of luxury and clean atmosphere that the customer of Cruxx is expecting for. Lighting is one of the key elements to a successful store environment. Well-designed lighting will create a desirable friendly and organic atmosphere as well this will guide consumer eyes to key sales points.( KERFOOT, S, 2003 [5] )The light colors in the shop will give the feminine and minimalistic feel which is what the Cruxx shop stands for, being basic, minimalistic and providing the best shopping experience for its’ customer. ( Appendix 4) In addition, light colours are often being associated with exclusivity which will add a luxurious look to the store ( KERFOOT, S, 2003 [5] The natural lighting will be a key in-store to create a natural and organic atmosphere. The big and clear shop window will not be blocked with stickers or any other noise except the mannequins and essential windows displays. The loft feel will be created by placing a ceiling very high ( ~ 5 meters) which will make the shop floor naturally light and spacious. Loud music is one of the major irritants of shopping, which is why the music in store will be always played at an appropriate sound volume, suitable for child’s ear too.
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STORE DESIGN AND VISUAL MERCHANDISING Orienting factors: Lynch (1960) devised the acronym ‘PLEND’ to describe the ability of individuals to find they way by reference to: Paths, Landmarks, Edges, Nods and Districts (MOHAN, G, 2013 [7]). In other words, these factors are called guides that will guide the visitors through the shop floor. The store will use the fixtures to break up the floor and paths that will be designed to stand out physically from the rest of the floor as they will be made of the different colour marble. According to the shopworks.co.uk, it cannot be predicted whether a customer will turn right or left when entering the store, even though the most of the world’s population are right-handers, but a good layout of the store will help to guide the consumer and effective store layout plan will maximize retail performance. (Shopwrks, 2014 ‘Right or Wrong?) By entering the store customers will most likely choose to turn left towards hanging clothing fixtures or either will walk straight towards folded clothing. If turning left, the customer will be led around the ground shop floor with having an opportunity to go upstairs to the second floor or at the back of the shop floor there shoes and handbags will be displayed clearly. Studies have showed that there is a tendency within the customers to turn 45o angles and not turn back which leads to placing the fixtures the way that every time customer turns at different angle they would be facing another fixture filled with products (appendix 5 ).
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The shop floor will be divided into four areas: Platinum, Gold, Silver and Bronze according to the theory store layout( Appendix 6 ). The prime selling space will stock the most expensive products. The entrance is the only part of the store which every customer passes through, resulting in placing the most valuable products in the front so every customer would be able to pass through them. The store layout will be divided into 4 areas according to the theory of platinum, gold, silver and bronze areas. The platinum space will also be used to place the promoted or discounted items in order to attract more customers from outside. The most expensive lines will be hanging on the fixtures which will make them readily visible and will also help the consumers to visualize outfits. The other folded lines will give a feeling of neat atmosphere and as most of the products will be stocked in the stockroom and only few displays will be places on the shop floor, this will let to keep the store tidy and spacious. (KERFOOT, S, 2003 [5]).
Cruxx will use coordinated merchandising technique to display the products, which means the collections will be grouped together to create the cohesive look. In some places the displaying product collections technique will be applied, for example displaying jeans together with jeans and tops with tops on the particular fixtures. The fitting rooms will be suited on the second shop floor which will encourage the customer to go and brows the second floor too. The mannequins will be displayed on the window display space to attract the customers from outside, as well as to save an expensive space on the shop floor. There will be created an open space in between a ground shop floor and a second floor (HOT SPOT). The space will be used to place the mannequins which will be seen from the first floor all around the shop floor, as well as climbing the stairs to the first shop floor. This use of mannequins will save the space on the shop floor, will wisely use the space of loft kind of high ceiling and will give a flagship store something that will differentiate it from other stores. The space will be able to access by the staff members and only seen but not accessed by visitors. Every new season the display will be changed according to the collection. The use of mannequins will also let the customers see the designs, entire outfits and create an image of what the clothes will look like on which will lead the customers to multiple purchases (MOHAN, G, 2013 [7]) . The photographs from the season collection look book will be hanging on walls in order to inspire the customers. There will be a sofa and a coffee table on the ground shop floor as a welcoming gesture. Although this area will take a valuable space, according to the needs of Cruxx target consumer it is something that they value and it would make them stay longer in a shop and be approached by a staff member, encouraged to spend more.
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The less valuable products will be places next to the tills where customer waiting in a queue could notice. The products will be used as a tool to increase the impulse buying behavior (appendix 7) of the customers by creating a store environment where the products might be noticed and purchased by an impulse. (MOHAN, G, 2013 [7])
retail design blog 2014
Anonymous
Rick Owens
‘Robert Kalinkin’ Vilnius
TECHNOLOGY USAGE IN-STORE It is crucial to let the consumers know why they should choose organic products priced higher rather than non-organic lower priced products. The customer will want to know how the product has been made and what makes it environment-friendly. In order to keep the customers informed, Cruxx will use the iPad devices placed on the walls next to products which every customer will be allowed to use and the help from sales associates will be provided. The iPad’s will store the information about every product and how it has been made. According to the academic article Article citation: Tasha Lewis, Suzanne Loker, (2014) “Technology usage intent among apparel retail employees” One study reported that 49% of a retailer sample indicated that educating and empowering employees with technology was an opportunity to improve store experiences and 70% rated in-store technologies as important to improved customer experiences ( LEWIS, T, 2014 [6])
‘As concerns grow over the “Big Brother” nature of Big Data, savvy retailers have proposed the opposite by emphasizing technology as a way to personalize experiences, enhance a sense of community and connect with consumers in real time. Jack Dorsey, CEO of Square, stresses the connective experience that cloud-based CRM can provide. If consumers’ profiles are generated by an opt-in program on a mobile device when they walk into a store, employees are alerted to their names and purchasing profiles, thereby allowing them to greet customers on a first-name basis. This is a succinct example of what some might call “invasive” technology being used to enhance personal interaction.’ Stylesight.com 2014 12
The use of this innovative technology will help the brand to interact with consumers personally, let them feel special and welcome. It will also help the brand to build customers loyalty and will be beneficial to the both parties, consumer and the retailer. The use of this innovative technology will help the brand to interact with consumers personally, let them feel special and welcome. It will also help the brand to build customers loyalty and will be beneficial to the both parties, consumer and the retailer. According to WGSN Newsteam, ‘Consumers
are willing to share their personal information with retailers if they get good value in exchange, a new study showed Monday. It also showed the importance of omnichannel, and features such as price consistency across stores and online, plus the ability to return online goods via the retailer’s physical store.’. (WGSN Newsteam. 2014). For sharing a personal information, customers will get a personal customers service in return which will help them to shop quicker and feel welcomed.
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THE FUTURE GROWTH For the future growth, as an organic and sustainable products retailer Cruxx will not be using a new supply chain model which is based on pull (appendix 8) distribution which is based on accurate customer demands and proper feedback methods. This type of supply chain will benefit the brand with : Costs saving and higher profitability Long term growth plan and strategies are alighted with the company mission and vision Strong connection between the suppliers Reduction of inventory waste (Traditional Vs. New Supply Chain Models CrackMBA . 2014)
As Cruxx brand stands in a considerably niche market it has its’ own design team, sourcing and buying teams that work together in order to create a desirable product. For the future expansion the retailer is about to use a franchising model as an international growth strategy. It will allow the retailer a quick access to the new markets, will require a less capital investment and will be managed an experienced parties that have a better knowledge and understanding within the market and consumer demand. In addition, it will still allow the company to make decisions and keep a control within a network, avoid a risk to damage the brands values and identity. The franchising strategy will mainly be used for overseas expansion in emerging markets such as USA and Asia. The brand will supply the products for a franchisee who will pay franchise fee which will guarantee the retailer inflowing money. The franchisee will also help in finding a location and will be trained in all aspects of the business. For the further expansion through Europe markets Cruxx will use Flagship stores and stores as a vehicle to enter the markets. (Hoffman, RC, 2004[3]) 13
MERCHANDISE PLAN The general merchandise planning will start 8 months before the new season launch. The planning will be based on top-down theory (appendix 9) In order to keep up with the latest fashion trends the planning will not start earlier than 8 months, but will also leave enough time for the buyers, merchandisers and the designers to create the range and get it done before the deadline in case of unpredicted situations what might happen entering a new market which could cause the loss of profit. If everything goes well, the following ranges will be planned only 6 months ahead of the season. “Women who are Muslim have been dressing fash-
ionably, in different ways, for a very long time. But, I think what we are seeing now — and what the market is beginning to be interested in — is the commercial development of self-consciously Muslim or Islamic fashion.” editor of Modest Fashion: Styling Bodies, Mediating Faith. Muslim women are allowed to dress the way they want unless they want to protect themselves from the eyes of people on the streets. Cruxx offers a variety of light and natural material clothes that covers all the skin except the face and feet. Other clothes can be worn under traditional Muslim cover-ups such as Hijaad and Khimar. Masdar Cruxx will offer a prospectively wider range of clothing pieces that cover all the body to meet local women needs. World Retail Congress, Empik Media & Fashion president and chief executive Maciej Dyjas said: “You need to be very humble and un-
derstand the markets where you are going.”
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The climate in this area of the world is fairly consistent throughout the year with little variation, and the weather in the Middle East is easy to describe: hot and dry. A predictable weather will let the Cruxx merchandising team to plan the ranges easily, and the product line will be the same as in the United Kingdom. In order for a foreign brand to adapt locally, it will stock more products with long sleeves or long skirts rather than short ones, to satisfy Arab women needs. It will still stock the other products such as trousers and t-shirts which less conservative or religious women are becoming more keen on buying as they want to dress like western culture women. As the time of seasons is different from the UK, for example : Christmas and New Years are celebrated in the mid-summer, the special ranges for such occasions will be introduced at an appropriate time which is different from the one in the UK. Cruxx offered product sectors will be : apparel, footwear and accessories. The assortment plan that covers women’s casualwear can be found at the end of this report under Appendix. Besides the casualwear, Cruxx brand will also stocks the product ranges suck as out-going range, underwear range and formal clothing.
CONCLUSION All the retailers need to look into the future.
By entering a new emerging market brand should focus on its’ customers demand. Cruxx has to find the way to excite the customers and attract the new ones. The balance have to be find between thinking globally and locally for the brand to succeed. By looking into the emerging market of the UAE, Cruxx brand found the opportune place to expand and open a flagship store - Masdar City, probably the most environmental friendly place on the planet. By opening a store in the selected site Cruxx will not only start its’ journey as a global brand but also will have an opportunity to strengthen the brand values such as being ethical and sustainable friendly. Many things have to be considered before opening the store, such as store environment, store design and etc. By choosing the right store format according to the consumer demand, Cruxx brand will likely to succeed internationally and expand into other emerging markets in the future by adopting different market entry strategies, according to the situation in the market.
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BIBLIOGRAPHY BOOKS: Belz, F.M. and Peattie K. (2012). Sustainability marketing. 2nd ed. Cornwall: TJ International. 21-49. Brown, M (2008). The Global Brand. United States: Palgrave Macmillan. 1-205. Cox, R. and Brittain P. (2004). Retailing an Introduction. 5th ed. Great Britain: Dorset Press. 99-114. Fernie J, Fernie S and Moore C (2003). Principles of Retailing . Oxford: Butterworth-Heinemann. 16-372. Jackson, T. and Shaw, D. (2001). Mastering Fashion buying and merchandising management. Basingstoke: Palgrave. 3-195. Kent, T. and Omar, O. (2003). Retailing. New York: Palgrave Macmillan. 116-143. Kunz, G.I (2005). Merchandising theory, principles and practice. New York: Fairchild Publications, Inc.. 4-76. Morgan, T (2008). Visual merchandising: Window and in-store display for retail.. London: Lawrence King. 14-126. Poloian, L.G (2009). Multichannel Retailing. USA: Fairchild Books. 48. WEBSITES: Fashion’s Missed Muslim Market Opportunity - BoF - The Business of Fashion. 2014. Fashion’s Missed Muslim Market Opportunity - BoF - The Business of Fashion. [ONLINE] Available at: http://www.businessoffashion. com/2014/05/fashions-missed-muslim-opportunity.html. [Accessed 10 May 2014]. Global Flagship Retail Stores - Worldwide Retail Landmarks and Destination Stores of U.S. and UK - Retail Industry Largest Stores of Top Retail Chains. [ONLINE] Available at:http://retailindustry.about.com/od/technologyinnovations/a/flagshipstores.htm. [Accessed 09 May 2014]. Green Industry Analysis 2014 - Cost & Trends. 2014. Green Industry Analysis 2014 - Cost & Trends. [ONLINE] Available at:https://www.franchisehelp.com/industry-reports/green-industry-report/. [Accessed 09 May 2014]. Retailers must ‘think global, act local’ for international success | News | Retail Week. 2014. Retailers must ‘think global, act local’ for international success | News | Retail Week. [ONLINE] Available at: http://www.retail-week. com/retailers-must-think-global-act-local-for-international-success/5002431.article. [Accessed 09 May 2014] . Traditional Vs. New Supply Chain Models | CrackMBA . 2014. Traditional Vs. New Supply Chain Models | CrackMBA . [ONLINE] Available at: http://crackmba.com/traditional-vs-new-supply-chain-models/. [Accessed 09 May 2014]. UAE Clothing. 2014. UAE Clothing. [ONLINE] Available at: http://www.grapeshisha.com/about-uae/ uae-clothing.html. [Accessed 10 May 2014]. WGSN Newsteam. 2014. Wgsn. [ONLINE] Available at: http://www.wgsn.com/content/report/News/2014/ Jan_Stories/Jan_14/News_Story_Jan_14_3.html. [Accessed 08 May 14].
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ACADEMIC JOURNALS [1] Brown, S, 2006. Retail location theory: evolution and evaluation. The International Review of Retail, Distribution and Consumer Research, 3:2, 188-229. [2] FERNANDES, C, 2013. Analysis of counterfeit fashion purchase behaviour in UAE. Journal of Fashion Marketing and Management, 17, 85-97 [3] Hoffman, RC, 2004. Global franchising: current status and future challenges. ournal of Services Marketing, 18, 101-113. [4] ILONEN, L, 2010. The role of branded retail in manufacturers’ international strategy. International Journal of Retail & Distribution Management, 42 (6), 415 – 425 [5] KERFOOT, S, 2003. Visual Merchandising and The Creation of Discernible retail Brands. International Journal of Retail & Distribution Management, 31, 143-152. [6] LEWIS, T, 2014. Technology usage intent among apparel retail employees. International Journal of Retail & Distribution Management, 42, 1-6. [7] MOHAN, G, 2013. Impact of store environment on impulse buying behavior. European Journal of Marketing, 47, 1711-1732. [8] Moore, CM, 2010. Flagship stores as a market entry method: the perspective of luxury fashion retailing. European Journal of Marketing, 44, 139-161. [9] Moore, CM, 2007. The operationalisation of international fashion retailer success. Journal of Fashion Marketing and Management, 11, 1361-2026.
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APPENDIX Appendix 1 Direct export In direct exporting, the firm becomes directly involved in marketing its products in foreign markets, because the firm itself performs the export task (rather than delegating it to others). This necessitates the creation of an export department responsible for tasks such as: Marketing research, Pysical distribution, export documentation, pricing.This approach to export requires more corporate resources and also entails greater risks. The expected benefits are: increased sales, greater control, better market information, development of expertise in international marketing.
Appendix 2 Location theory
Central place – Variously described as ‘the most innovative and most successful attempt to construct a fully realised theory of spatial structure’ (Stevens 1985: 672) and ‘too implausible to serve as a basis for empirical work’ (Marshall 1978: 125), central place theory is a powerful, elegant and, down the years, much maligned conceptualization (see Beavon 1977; King 1984; Marshall 1989). As formulated by Christaller (1933) and subsequently Losch (1940), it describes the number, size, spacing and functional composition of service centres in a micro-economic world where there is a uniform distribution of identical, equally affluent, fully informed consumers, all of whom are served by sellers that price f.o.b., enjoy equivalent costs and free entry and behave in a rational, perfectly competitive, profit-maximizing manner. Travel, moreover, is uniformly priced and equally easy in all directions, consumers patronize the near- est centre that purveys the merchandise required and a separate, single- purpose shopping trip is made for each individual item. spatial interaction theory : If the central place and spatial interaction theories are similar in terms of their ability to generate research activity, they differ in respect of their basic as~um~tions.~ Whereas traditional central place theory assumes that consumers patronize the nearest centre that offers the required good or service, spatial interaction theory is based on the sup- position that consumers trade off the attractiveness of alternative shop- ping areas against the deterrent effect of distance. Shoppers, in other words, may bypass the nearest centre offering the desired merchandise for a more distant but better-appointed destination. Alternatively, they may choose to patronize a convenient neighbourhood centre despite the limited range of goods available (see Openshaw 1975; Haynes and Fotheringham 1984; Fotheringham and O’Kelly 1989). Appendix 3 Maslow’s hierarchy of needs theory: Maslow (1943) stated that people are motivated to achieve certain needs. When one need is fulfilled a person seeks to fullfil the next one, and so on.The earliest and most widespread version of Maslow’s (1943, 1954) hierarchy of needs includes five motivational needs, often depicted as hierarchical levels within a pyramid.
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Appendix 4 Survey: I have created a primary research survey to understand what would work for a target consumer of Cruxx in terms of in-store design and environment. The survey can be reviewed on this address https://www.surveymonkey.com/s/ X6JKP2R 43 people have completed the survey from which 37 were around age 18 to 34. 64% of the candidates go shopping for clothes 2-3 times a month. The results showed that 83% of participants prefer shopping in-stores and 75% think that interior of the store is very important. I have also asked to tell and comment what type of interior would they prefer and 82% answered they would choose a light interior, mainly because It associates with welcoming atmosphere and exclusivity. The following question was whether they prefer clothes to be hanging in a store or folded on fixtures. 12 % said they prefer clothes to be hanging, 10 % to be folded, 30 % didn’t mind and the rest chose ‘both’ as the answer. Lastly, I have asked whether the participants would pay more for the product in a return of perfect atmosphere in-store, 73 % indicated ‘Maybe’ for the answer. Appendix 5 Most people do not approach stores in a straight line. Angles of approach are often determined by external factors such as the position of columns, parked cars or shopping mall travelators. These external factors therefore have a strong bearing on which side of the store is most easily visible and accessible. Combine these factors with shoppers’ tendency to turn at 45 degree angles and not to turn back on themselves, and the most likely outcome is they will continue travelling into the store in the direction they came from.
Appendix: 6 Platinum, Gold, Silver and Bronze areas theory In the book of Visual Merchandising: Window and In-Store Display for Retail, divided the floor layout into four sections named by colors: platinum area, gold area, silver area and bronze area. The platinum area is usually near the entrance where attractive products - new arrival, discount products, and high fashions are displayed. The gold area is just followed after the platinum area when consumer walk through the store. The silver area lies at the back of the store. The bronze area lies the end. Bronze area is considered as having fewer customers due to the far distance. It is recommended to display basic products or popular band to attract more customers for a good traffic flow in the store, (Morgan 2008)
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Appendix 7 IMPULSE BUYING behaviour
Appendix: 8 A pull strategy involves motivating customers to seek out your brand in an active process. “Getting the customer to come to you” EXAMPLES OF PULL TACTICS • Advertising and mass media promotion • Word of mouth referrals • Customer relationship management • Sales promotions and discounts
Appendix : 9 Top-Down merchandise planning : Top-down planning is what we do when we impose a number at a consolidated level. For example we might look at a Total Product level sales plan and decide to impose a high level change because there is a gap between this number and the previously agreed strategic targets. This change would then cascade down to all component members of Total Products.
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