Information Gathering and Processing in Retailing

1. Information Gathering and Processing in Retailing

2. Information Flow in a Retail Distribution Channel Information And the Supplier Information And the Retailer Information And the Consumer

3. Information Flow in a Retail Distribution Channel • A supplier- the manufacturer or wholesaler- provides information to both the retailer (such as market forecast) and the consumer (such as an ad describing a new product). • The supplier determines the information needs of the retailer and the consumer through conversations, surveys, feedback forms, and so forth.

4. Information Flow in a Retail Distribution Channel • A retailer provides information to both the supplier (such as store unit sales) and the consumer (such as salesperson answering questions). • The retailer determines the information needs of the supplier and the consumer through conversations, surveys, feedback forms and so forth.

5. Information Flow in a Retail Distribution Channel • A consumer provides information to the supplier and retailer through his or her purchase, credit card data, conversations, feedback forms, complaints and so forth. • In return, the total retail experience is enhanced by the supplier and retailer, since they better understand the consumer and provide better information to the consumer.

6. Avoiding Retail Strategies Based on Inadequate Information • Following strategies must be avoided by a retailer: • Using intuition • Continuing what was done before • Copying a successful competitor’s strategy • Devising a strategy after speaking to a few individuals about their perceptions • Automatically assuming that a successful business can easily expand

7. The Retail Information System Retailer’s Philosophy And Objectives Strategic Plans Environment • Data collection, • analysis, and • interpretation Information Collection Centre (b) Data storage and Retrieval (c) Updating of files Retail Operations Implementation Feedback

8. Building & Using A Retail Information System (RIS) • In building a retail information system, a number of decisions have to be made: • How active a role should the RIS have? • Should an RIS be managed internally or be outsourced? • How much should an RIS cost? • How technology-driven should RIS be? • How much data are enough? • How should data be disseminated throughout the firm? • How should data be stored for future use?

9. Data-base Management • In database management, a retailer gathers, integrates, applies, and stores information related to specific subject areas. • Database management should be approached as a series of five steps: • Plan the particular database and its components and determine information needs. • Acquire the necessary information. • Retain the information in a usable and accessible format. • Update the database regularly to reflect changing demographics, recent purchases, and so forth. • Analyze the database to determine company strengths and weaknesses.

10. Retail Database Management in Action Data Warehouse Dissemination of Information Executives and Other Company Employees Channel Partners Customers Data Mining Micro-marketing

11. Retail Database Management in Action • The data warehouse is a place where information is collected, sorted and stored centrally. • Information is disseminated to retailer personnel, as well as to channel partners and customers. • In data mining, retail executives and other employees analyze information by customer type, product category and so forth in order to determine opportunities for tailored marketing efforts. • With micro-marketing, the retailer applies differentiated marketing.

12. The Marketing Research Process Define issue Or problems to be researched Examine Secondary Data Generate Primary Data Implement Findings Make recommendations Analyze Data

13. The Marketing Research Process • Issue definition involves a clear statement of the topic to be studied. • When secondary data are involved, a retailer looks at data that have been gathered for purposes other than addressing the issue or problem currently under study. • When primary data are involved, a retailer looks at data that are collected to address the specific issue or problem under study. • At this point, the pros and cons of each alternative are enumerated. • Recommendations are then made as to the best strategy for the retailer. • Lastly the recommended strategy is implemented.

14. Secondary Data • Advantages: • Data assembly is inexpensive. • Data can be gathered quickly. • There may be several sources of secondary data-with many perspectives. • A secondary source may possess information that would otherwise be unavailable to the retailer. • When data are assembled by a source. • The retailer may have only a rough idea of topics to investigate.

15. Secondary Data • Disadvantages • Available data may not suit the purposes of the current study because they have been collected for other reasons. • Secondary data may be incomplete. • The accuracy of secondary data must e carefully evaluated. • Some secondary data sources are known for poor data collection techniques. • In retailing, many secondary data projects are not retested and the user of secondary data has to hope results from one narrow study are applicable to his or her firm.

16. Secondary Data • Sources • Internal secondary data • Available within the company • From the data bank of a retail information system • External secondary data • They are available form outside the firm. • They should be consulted if the internal information is insufficient.

17. Primary Data • Advantages • They are collected to fit the retailers specific purposes. • Information is current • The units of measure and data categories are designed for the issue being studied. • The firm either collects data itself or hires an outside party. • There are no conflicting data from different sources. • When secondary data do not resolve an issue, primary data are the only alternative.

18. Primary Data • Disadvantages • They are normally more expensive to obtain than secondary data. • Information gathering tends to be more time consuming. • Some types of information cannot be acquired by an individual firm. • If only primary data are collected, the perspective may be limited. • Irrelevant information may be collected if the issue is not stated clearly enough.

19. Primary Data • Sources • The first decision is to determine who collects the data • A retailer can do it itself or hire a research firm. • Internal collection is usually quicker and cheaper. • External is usually more objective and formal.

20. Primary data • Second, sampling method is specified. • Instead of gathering data from all stores, all products, and all customers, a retailer may obtain accurate data by studying a sample of them. • With a probability (random) sample, every store, product, or customer has an equal or known chances of being chosen for study. • In non-probability sample, stores, products, or customers are chosen by researcher.

21. Primary Data • Third, the retailer chooses among four methods of data collection. • Survey • Observation • Experiment • Simulation

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