Chapter 14 – Retail Communication Mix
14-1
CHAPTER 14
RETAIL COMMUNICATION MIX
ANNOTATED OUTLINE
INSTRUCTOR NOTES
I. Introduction
• The communication program informs customers about the
retailer, describes the merchandise and services offered,
and plays a critical role in developing repeat visits and
customer loyalty.
• Communication programs can have both long-term and
short-term effects on a retailer’s business. From a long-
• Advertising is paid communications delivered to customers
through nonpersonal mass media such as newspapers,
television, radio, direct mail, and the Internet. Today,
successful retailers utilize an integrated marketing
communication (IMC) program in which they integrate a
variety of communication elements to deliver a
• These media elements vary on five dimensions:
Ask students how new forms of
social media elements (YouTube,
blogs, Twitter, Facebook) have
impacted retailers today in terms
of personalization, interactivity,
and costs.
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II. New Media Elements
• Over the past decade or so, the use of newer forms of
LO 14-1 Identify the new media
elements.
A. Online Media
1. Websites
• Retailers use their websites to build their brand image;
inform customers of store locations, special events, and
the availability of merchandise in local stores; and sell
merchandise and services.
2. E-mail
• E-mail involves sending messages over the Internet to
specific individuals. Retailers use e-mail to inform
See PPT 14–14
3. Mobile Marketing
• Mobile marketing, also called mobile commerce, M-
commerce, or mobile retailing, is marketing through
wireless handheld devices such as cellular telephones.
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experience with their mobile interface.
B. Social Media
• Social media include various forms of electronic
• Sentiment analysis is the process of analyzing data
posted on social media sites to assess customers’
overall valence (positive, neutral and negative) and
1. YouTube
• On this video-sharing social media platform, users upload,
share, view, and comment on videos. This medium gives
Ask students if they have ever
looked up “how to do” something
on YouTube. Discuss how retailers
could benefit by demonstrating
2. Facebook
• This social media platform with more than 1.5 billion active
users gives companies a forum to interact with fans.
3. Blogs
• On a blog (weblog), an individual blogger or a group of
users regularly post their opinions and various topical
information on a web page.
Ask students to share some of
their favorite blogs and the
characteristics of the blog that
make them loyal readers.
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4. Twitter
• Twitter is a microblog—a short version of a blog—in which
users are limited to 140-character messages.
III. Traditional Media Elements
• Retailers use various traditional media elements: mass
media advertising, promotions, in-store marketing,
LO 14-2 Identify the traditional
media elements.
See PPT 14–5
A. Mass Media Advertising
1. Advertising
• This form of mass media entails the placement of
announcements and persuasive messages purchased by
retailers and other organizations that seek to inform
and/or persuade members of a particular target market or
See PPT 14–6 and 14-7
Discuss with students the benefits
and drawbacks of different types
of advertising. For example, why
might a retailer choose to run a
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2. Newspapers
• Retailing and newspaper advertising grew up together over
the past century. But the growth in newspaper advertising
by retailers has slowed recently as retailers have begun
using other media.
3. Magazines
• Advertising in national magazines is mostly done by
national retailers such as Target and Sephora.
4. Direct Mail
• Direct mail refers to any brochure, catalog, advertisement,
or other printed material delivered directly to the
consumer.
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5. Television
• Television commercials can be placed on a national
network or local station. Retailers typically use TV for
image advertising, to take advantage of the high
6. Radio
• Many retailers use radio advertising because messages can
be easily targeted to a specific segment of the market.
7. Billboards
• Billboards are outdoor advertisements that are generally
large and appear adjacent to and above roads or highways.
Chapter 14 – Retail Communication Mix
B. Sales Promotions
• Sales promotions are special incentives or excitement-
building programs that encourage consumers to purchase
a particular product or service.
See PPT 14–8 and 14-9
Ask students how they respond to
sales promotions. Do sales
promotions generate excitement?
Do they expect certain retailers to
engage in more sales promotion
activities than other?
1. Coupons
• Coupons offer a discount on the price of specific items
when they’re purchased at a store.
price returned to the buyer in the form of cash.
2. Rebates
• Rebates provide another form of discounts for consumers.
3. Premiums
• A premium offers an item for free or at a bargain price to
reward some type of behavior, such as buying, sampling, or
testing.
C. In-Store Marketing/Design Elements
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1. Point-of-Purchase Displays
• Point-of-purchase (POP) displays are merchandise displays
2. Samples
• Samples offer potential customers the opportunity to try a
3. Special Events
• A special event is a sales promotion program comprising a
number of sales promotion techniques built around a
seasonal, cultural, sporting, musical, or some other type of
activity.
or sports and entertainment sectors.
E. Personal Selling
• Personal selling is a communication process in which sales
associates help customers satisfy their needs through face-
to-face exchanges of information.
Communicating through
salespeople is much more
expensive than communicating
through advertising. Ask students
why department stores place
more emphasis on paid personal
versus impersonal
communications. Why do
supermarkets do just the
opposite?
F. Public Relations
Ask students to describe some
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maintaining positive relationships with the media.
Why don’t retailers rely on public
relations rather than advertising?
1. Neiman Marcus and Its Christmas Catalog
• The Neiman Marcus Christmas book is perhaps the nation’s
2. Macy’s and Cause-Related Marketing
• Macy’s has partnered with many charities in a successful
3. Retailers and Product Placement
• When retailers and vendors use product placement, they
IV. Planning the Retail Communication Program
• The four steps in developing and implementing the retail
LO 14-3 List the steps involved
in developing a communication
program.
A. Establish Objectives
• Retailers establish objectives for their communication
programs to provide (1) direction for people implementing
the program and (2) a basis for evaluating its effectiveness.
See PPT 14–22
Discuss the goals for a
communications program.
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making process.
• To effectively implement and evaluate a communication
program, objectives must be clearly stated in quantitative
terms.
customers found the location very
inconvenient?
Illustrate which methods are more
B. Determine the Communication Budget
• The second step in developing a retail promotion program
is to determine a budget.
See PPT 14–23
Review the methods for setting a
budget and illustrate the
difference in the logic between
1. Marginal Analysis Method
• Marginal analysis is based on the economic principle that
See PPT 14–24
2. Objective-and-Task Method
• The objective-and-task method determines the budget
required to undertake specific tasks for accomplishing
communication objectives.
See PPT 14–25
As in the marginal analysis, the
relationship between the
expenditures and the objective
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3. Rule-of-thumb Methods
• In the previous two methods the communication budget is
set by estimating communication activities’ effects on the
See PPT 14–27
Ask students why the marginal
analysis and objective-and-task
a. Affordable Budgeting Method
• When using the affordable budgeting method,
retailers first forecast their sales and expenses,
b. Percentage-of-Sales Method
• The percentage-of-sales method sets the
communication budget as a fixed percentage of
The typical advertising
expenditures for food stores are
1.4% of sales. Ask students
whether they would expect the
c. Competitive Parity Method