Retail Marketing Terms

Discover the fundamentals of retail marketing terms and promotions. This glossary breaks down crucial terms, from digital strategies to traditional advertising techniques, equipping you with the knowledge to craft impactful marketing campaigns.

Customer Engagement

• Brand Loyalty: The tendency of some consumers to continue buying the same brand of goods rather than competing brands.
• Conversion Optimization: The process of increasing the percentage of users who perform a desired action on a website.
• Customer Segmentation: The practice of dividing a customer base into groups of individuals that are similar in specific ways relevant to marketing.
• Inbound Marketing: A business methodology that attracts customers by creating valuable content and experiences tailored to them.
• Market Segmentation: The process of dividing a target market into smaller, more defined categories.
• Target Audience: A specific group of people identified as the intended recipient of an advertisement or message.
• User-Generated Content: Content created by the users of a brand or product, often shared via social media or other platforms.
• Customer Experience (CX): The product of an interaction between an organization and a customer over the duration of their relationship.
• Personalization: Tailoring a service or a product to accommodate specific individuals, sometimes tied to groups or segments of individuals.
• Contests, Sweepstakes, and Games: Used to generate excitement for the product or service. Includes contests where consumers submit entries to be judged, sweepstakes involving drawings of price winners, and games that engage consumers with purchases​​.
• Demonstrations: Promoting new brands through demonstrations at various events or locations, employed for products like cosmetics, household appliances, and beverages​​.

Digital Marketing

• Content Marketing: A strategic marketing approach focused on creating and distributing valuable, relevant, and consistent content to attract and retain a clearly defined audience.
• Digital Marketing: Marketing of products or services using digital technologies on the Internet, through mobile phone Apps, display advertising, and any other digital mediums.
• Influencer Marketing: A form of social media marketing involving endorsements and product placements from influencers, people and organizations who have a purported expert level of knowledge or social influence in their field.
• PPC (Pay-Per-Click): An internet advertising model used to drive traffic to websites, in which an advertiser pays a publisher when the ad is clicked.
• SEO (Search Engine Optimization): The practice of increasing the quantity and quality of traffic to your website through organic search engine results.
• SEO Keywords: Words and phrases in your web content that make it possible for people to find your site via search engines.
• Social Media Marketing: The use of social media platforms and websites to promote a product or service.
• Affiliate Marketing: A marketing arrangement by which an online retailer pays commission to an external website for traffic or sales generated from its referrals.
• Content Curation: The process of gathering information relevant to a particular topic or area of interest to add value for your audience.
• Mobile Marketing: Marketing on or with a mobile device, such as a smartphone, targeting consumers through their mobile devices.

Marketing Communication

• AIDA: Attention, Interest, Desire, Action – the process a prospect goes through before deciding to purchase.
• Advertisement: Non-paid form of communication by an identified sponsor aimed at a target audience.
• Promotion Mix: The combination of tools like advertisement, sales promotion, personal selling, publicity, PR, and direct marketing used to promote offerings.
• Hierarchy of Affects: Theories describing the steps a prospect takes while analyzing marketing communication before making a purchase decision.
• Direct Marketing: A method that includes all types of non-store retailing such as direct mail, catalog retailing, and televised shopping. It’s defined as using advertising to contact consumers directly, prompting purchases without visiting a retail store​​​​.

Macro Environmental Forces

• Demographic Environment: The study of population size, distribution, and trends, affecting marketing practices and strategies.
• Political / Legal Environment: Comprises laws, government agencies, and pressure groups that impact marketing decisions and practices.
• Social / Cultural Environment: Involves societal values, norms, and cultural shifts that influence marketing opportunities and threats.
• Economic Environment: Considers the purchasing power, economic conditions, and their impact on marketing efforts​​.

Sales Promotion Strategies

• Brand Awareness: The extent to which consumers are familiar with the distinctive qualities or image of a particular brand of goods or services.
• Cross-Merchandising: The practice of displaying products from different categories together, in order to generate additional revenue, known also as add-on sales.
• Flash Sales: Limited-time discount offers that involve high discounts on specific products, creating a sense of urgency among customers.
• Remarketing: A way to connect with people who previously interacted with your website or mobile app, aiming to re-engage them based on their past actions.
• Viral Marketing: A marketing strategy that uses social networks to promote a product, typically through self-replicating viral processes.
• Loyalty Programs: Reward programs offered by a company to customers who frequently make purchases.
• Point of Purchase (POP) Display: Specialized sales promotions located at checkout areas or other locations where the purchase decision is made.
• Sales Promotion: Short-term promotional activities designed to influence the customer’s purchase decision.
• Innovation Adoption: The process through which customers adopt new concepts introduced by marketers.
• Every Day Low Pricing (EDLP): A consistent pricing strategy where prices are set below the Maximum Retail Price (MRP) at all times.
• Efficient Consumer Response (ECR): A movement aimed at enhancing customer value by improving supply chain efficiency.
• Gross Margin Return on Investment (GMROI): The ratio of gross margin to average inventory cost, indicating the profitability of inventory investment.
• Team Selling: Utilizing a team of professionals for selling to and servicing major customers, especially when specialized knowledge is required.
• Multi-Unit Pricing: Offering discounts to customers who buy in large quantities or product bundles.
• Discount Pricing: Strategy used by outlet stores offering merchandise at the lowest market prices.
• Every Day Low Pricing (EDLP): A continual low pricing strategy, famously used by retailers like Wal-Mart and Toys “R” Us.
• Odd Pricing: Setting retail prices to end in odd numbers like 99.99 or 199​​.
• Coupons: Certificates entitling the consumer to a specified saving on the purchase of a specified product, generally issued by manufacturers.
• Premium or Bonus Offer: Products or services offered as an incentive to buy other products or services, including types like direct premiums, reusable containers, free in mail premiums, and self-liquidating premiums.
• Money Refund Offers: The manufacturer returns the purchase price if the consumer is not completely satisfied.
• Price Off Promotion: Offers a certain amount off the regular price of a product, prominently printed on the label or package​​.

Inventory Management

• Open-to-buy: The budget allocated for purchasing stock within a specific time period.
• Assortment Plan: Planning the variety and depth of product assortment within a category.
• Stock Turnover Ratio: The rate at which inventory sells and is replenished.
• Merchandise Allocation: Distributing the quantity and quality of merchandise to outlets based on market demand.
• ABC Analysis: Segregating inventory into three categories based on their value contribution to the supply chain.
• Stock Keeping Units (SKUs): Various packaging sizes available for product units.
• Category Management: Deciding on the total range of products in particular categories to be sold, focusing on managing categories as strategic business units rather than individual brands.

Mastering retail marketing terms and promotions is essential for driving retail growth. Utilize this glossary as a guide to navigate the ever-evolving marketing landscape, enhancing your brand’s visibility and customer engagement.