Market Segmentation
What is a Target Market?
A group of consumers that the retailer is seeking to serve.
What are Store-Based Retailers?
Retailers that operate from a fixed store location and require customers to travel to the store to make a purchase.
Weaknesses of Central Business District
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-Inadequate parking
-Older stores
-Higher rent/taxes
-Potentially higher crime rates
Weaknesses of Shopping malls
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-Inflexible hours
-Higher rents
-Restrictions on merchandise
-Too much competition
Characteristics of Free-Standing Locations
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-Located along major traffic routes
-Lack of adjacent retailers selling competitive products
-Typically large, well-known retailers
What is Market Segmentation?
The method retailers use to break down heterogeneous consumer populations into smaller homogeneous groups.
What are Nonstore-Based Retailers?
Retailers that reach the customer at home, work, or any place other than at a traditional store.
Strengths of Central Business Districts
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-Easy public access
-Wide assortment of products sold
-Proximity to commercial activities
Strengths of Shopping malls
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-Heavy traffic
-Cooperative planning/sharing of costs
-Access to highways
-Clean and neat
-Decreased crime rates
Strengths of Free-standing locations
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-Lack of direct competition
-Generally lower rent
-Freedom in operations and hours
-Facilities that can be adapted to the retailer's own needs
-Inexpensive parking
For a segment(s) to be considered attractive enough for becoming one's target market, it must meet what 3 criteria?
1. It must be measurable
2. It must be accessible
3. It must be substantial
Give an example of a Store-Based Retailer and a Nonstore-Based Retailer
Store-Based Ex: TJ Maxx, Marshall's, Boutiques, Thrift Stores
Nonstore-Based Ex: Wish, Shein, Amazon
3. Characteristics of Central Business Districts
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-Usually located around a geographic point with public transportation systems
- Make-up usually depends on history, past retail trends, and luck
-Attractiveness is usually in decline, but can become enhanced
Characteristics of Shopping Centers/Malls
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-Centrally owned
-Planned
-Balanced tenancy
-Large amounts of parking
Weaknesses of Free-standing locations
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-Lack of drawing power
-Difficulty in attracting customers
-Higher advertising and promotional cost
-Cannot share operating costs
-Stores being built, not rented
-Zoning Laws
Characteristics of Secondary Business District
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-Smaller than CBD
-Revolves around at least one department/variety store
-Located at major street intersection
Characteristics of Neighborhood District
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-Smaller than SBD
-Evolves to satisfy convenience
-Generally many smaller stores centered around one supermarket/variety store
-Located on a major area of residential area