Chapter 17

Question 1

enables customer to locate and purchase products in an efficient and timely manner with minimum hassle

Answer 1

UTILITARIAN BENEFITS

Question 2

offers customers an entertaining and enjoyable shopping experience

Answer 2

HEDONIC BENEFITS

Question 3

area within a store designed to get the customers attention

Answer 3

FEATURE AREA

Question 4

products in complementary categories are placed together to encourage unplanned purchases (products that are displayed side by side)

Answer 4

ADJACENCIES

Question 5

– a diagram that shows how and where specific SKUs should be placed

Answer 5

PLANOGRAMS

Question 6

holds a lot of merchandise, hard to feature specific styles and colors … discount and off-price stores

Answer 6

STRAIGHT RACK

Question 7

smaller than a straight, holds a maximum amount of merchandise, easy to move, no frontal view of merchandise … all types of stores

Answer 7

ROUNDER

Question 8

– holds a lot of merchandise, allows customer to view entire garment, hard to maintain, aka feature fixtures … fashion oriented retailers

Answer 8

FOUR-WAY

Question 9

versatile, hard to view the apparel, used to display flat products … department stores, grocery stores, discount stores

Answer 9

GONDOLA

Question 10

a retailer offers a limited number of predetermined price points within a classification

Answer 10

*PRICE LINING

Question 11

the design of an environment through visual communications, lighting, colors, music, and scent to stimulate customers’ perceptual and emotional responses and ultimately to affect their purchase behavior

Answer 11

STORE ATMOSPHERE

Question 12

OBJECTIVES OF STORE DESIGN

Answer 12

1. ) Implement retailer’s strategy
2. ) Build loyalty
3. ) Increase sales on visits
4. ) Control cost
5. ) Legal considerations – Americans with Disabilities Act

Question 13

STORE DESIGN & CUSTOMER LOYALTY

Answer 13

Customers develop loyalty to the retailer when it provides the type of benefits the customer seeks (i.e. – utilitarian or hedonic)

Question 14

STORE DESIGN & SALES/COST CONTROL

Answer 14

• Store design can influence which products are purchased, how long shoppers stay in the store, and how much shoppers spend
• Control the cost of implementing the store design and maintain the store’s appearance
• Store design influences shopping experience & thus sales, labor costs, and inventory shrinkage

Question 15

STORE LAYOUTS

Answer 15

-to encourage customer exploration and helo customers move through the stores, use a layout that facilitates a specific traffic pattern and provide interesting design elements

1.) GRID LAYOUT
ADV - easy to locate merchandise, allows more merchandise to be displayed, cost efficient
DISADV - doesn’t encourage exploration, can’t see over shelves
** used in discount stores

2.) RACETRACK LAYOUT
ADV - draws customers around the store, provides different viewing angles and encourages exploration & impulse buying
DISADV - not easy to find what you want, requires more sales personnel
**used in department stores

3.) FREE-FORM LAYOUT
ADV - intimate, relaxing environment that facilitates shopping & browsing
DISADV - ambiance doesn’t come cheap, inefficient use of space, more susceptible to shoplifting

Question 16

SIGNAGE

Answer 16

LOCATION – tells customers where to go, where things are located
CATEGORY – identifies types of products that are being offered
PROMOTIONAL – describes special offers
POINT OF SALE – contain price and other detailed information about the product
LIFESTYLE – usually a photo showing the desired lifestyle of the store image

Question 17

SPACE ALLOCATION

Answer 17

Two Decisions – how to allocate stores space to merchandise categories & brands … where to locate departments or merchandise categories in the store
Considerations In Space Planning: productivity of allocated space, inventory turnover, impact on store sales, and display needs for the merchandise
Prime Locations for Merchandise: highly trafficked areas (entrances & checkouts) and highly visible areas (end aisles & displays)
Location of Merchandise Categories: Impulse Merchandise – checkout … demand/destination merchandise – back of store … special merchandise – displays … adjacencies – displayed together

Question 18

CUSTOMER MOVEMENT

Answer 18

-Videotaping consumers – learn customer’s movements, where they pause or move quickly, or where there’s congestion … evaluate the layout, merchandise placement, and promotion
Virtual Store Software – learn the best place to put merchandise and test how customers react to new products

Question 19

PRESENTATION TECHNIQUES

Answer 19

1. ) Idea-Oriented – merchandise presented in a way that represents an idea, store image, or theme
2. ) Style/Item – presenting items based on their style
3. ) Color – organizing according to the color of the merchandise
4. ) Price Lining – organizing and presenting merchandise according to their prices
5. ) Vertical Merchandising – presenting merchandise vertically using walls and high gondolas because of the way consumers read and see things (top to bottom, left to right)
6. ) Tonnage – large quantities of merchandise displayed together
7. ) Frontal – displays as much of the product as possible to catch the customer’s eye

Question 20

STORE ATMOSPHERE

Answer 20

1. ) LIGHTING – highlight merchandise, structure space and capture a mood, downplay features
2. ) COLOR – warm colors (red, gold, yellow) produce emotional, vibrant, hot and active responses, cool colors (white, blue, green) have a peaceful, gentle, calming effect, colors are culturally bounded
3. ) MUSIC – control the pace of store traffic, create an image, and attract or direct consumers’ attention, a mix of classical or soothing music encourages shoppers to slow down, relax, and take a good look at the merchandise and therefore stay longer and purchase more … music can deter unwanted shoppers
4. ) SCENT – has a positive impact on impulse buying behavior & customer satisfaction … scents that are neutral produce better perceptions of the store than no scent at all … customers in scented stores think they spent less time in the store than subjects in unscented stores

Question 21

PROCESSING HANDOUT

Answer 21

FRONT STAGE – visible actions of customer – contact personnel
BACK STAGE – invisible actions of customer – contact personnel
FAIL POINT – spot in the service blueprint where something went wrong or was missing
LINE OF INTERACTION – separates customers & front stage personnel
LINE OF VISIBILITY – separates front and backstage actions, what the customer can and cannot see

Question 22

TYPES OF SERVICES

Answer 22

PEOPLE – something tangible happening to the person (i.e. getting a haircut)
POSSESSION – something tangible happening to your possessions (i.e. getting your car fixed)
MENTAL STIMULUS – intangible process, changing something about your mind, attitude, etc. (i.e. schooling)
INFORMATION – intangible things happening to your possessions (i.e. banking)

Question 23

BLUEPRINTING

Answer 23

specifies how the service is to be carried out in detail
-identifies key activities in creating & delivering services
-clarifies interactions between customers & staff, and support them with backstage activities & systems
-identify fail points
COMPONENTS – main customer actions, specify physical evidence, line of interaction, front stage actions, line of visibility, backstage actions, and support processes involving other service personnel

Question 24

WHY REDESIGN OUR SERVICE PROCESS?

Answer 24

revitalizes a process that has become outdated, changes in external environment make existing practices obsolete and require redesign of underlying processes, rusting occurs internally (natural deterioration of internal processes; creeping bureaucracy, evolution of spurious, unofficial standards)

Question 25

APPROACHES TO REDESIGN

Answer 25

1. ) Eliminate non-value added steps …
2. ) Shift to self-service …
3. ) Deliver direct service …
4. ) Bundling …
5. ) Redesigning physical aspects – focus on tangible elements (include changes to facilities and equipment to improve service experience), cultivate interest in customers, differentiate company, increase customer convenience, enhance the satisfaction and productivity of frontline staff

Question 26

CUSTOMER PARTICIPATION

Answer 26

actions and resources supplied by customers during service production and/or delivery (includes mental, physical, and emotional inputs)
LOW – …
MEDIUM – …
HIGH – …

Question 27

SELF-SERVICE TECHNOLOGIES

Answer 27

ultimate form of customer involvement
-information-based services can easily be offered using SST’s (i.e. ebay – no human auctioneer needed)
ADV – time or cost savings, flexibility, high perceived level of customization, convenience of location, greater control over service delivery