Merchandise Allocation

I think back to when we lived in base housing on what was known as Naval Air Station Joint Reserve Base almost 10 years ago. It is a much different area today than when it was known as Carswell Air force Base. Carswell was built in 1942 and with it a community started to develop. With World War II the base became a major part of history.

After World War II the necessity of the base become less and less. Then in 1993 it was slated to close by 1994. The area around the base became very aged along with the people. Most residence were retirees. This are definitely fit in the “rustbelt Retirees” segment to merchants. Most of the town has small café to sit ands visit and small local stores to shop. Nothing to high end there.

Fortunately the decision was modified in 1994 and the base was converted into what we know as NASJRB. With it came young service men, woman and families. Most of the base housing was sold and moved making way for developers to come in and revitalize the area. It is now a booming retail circus around the base. The area has graduated into the “Laptops and Lattes” segment for merchants. With this change the merchants had to change what was in stores. It was no longer just retires shopping here.
I think now there is a nice mix of retailers. There are merchants here to accommodate everyone.

Frequent Shopper Perks

My wife is a Kroger shopper. She shops the sales but you have to have that Kroger Plus card to benefit from those deals. They make it worth keeping up with that card as annoying as it is. If she spends over $100 she gets $.10 off per gallon of gas at the Kroger pump. That was a huge incentive when gas was almost $4.00 a gallon a few months ago.
But, my wife’s biggest struggle is keeping up with the card. She is always changing purses and coordinating wallets and sometimes that card does not make it into the current purse. This situation can quickly become a dilemma when it is time to shop.
As I read on in chapter 11 about frequent shopper programs it started in about technological advancements. The different ways retailers can get your identity and information without having to ask for it. The one most interesting to me was the fingerprint scanning. With a touch of your finger the retailer can do everything from accrue your frequent buyer points to debit your bank account. Never again would you have to worry about where that card went.
But, with any technological advancement come pros and cons. The pros are that you would not have a card to have to keep up with, no password to memorize and a fingerprint is harder to steal than a card.
Now on to the cons of fingerprint scanning. If you loose a card or forget a password you can get another and start over with a new one. If your fingerprint is stolen…and it can be done..you are stuck with it the rest of your life. An extreme and gruesome reality would be people getting their fingers cut off for their print.
The fingerprint scanning technology is not big in the U.S. yet. But it is a huge success in Germany. Over ¼ billion people now use fingerprint scanning in Germany. You can bet it is just a matter of time before that technology is widely used here.

Location, Location, Location

It is not too surprising the location is a huge consideration for retailers. It can defiantly make or break a business.
Our town started out as a nice quiet “farming” community. Inevitably through time it has evolved to much more. With that growth came the usual anchors such as Wal-Mart, Albertsons and a dozen nail salons. All of which flourish and thrive along with the population.
Our town soon caught the eye of a new company with a new concept called Fresh Lane. This company was started by a mom with young kids. A drive through grocery store was the idea. On a much smaller scale of course but it had all the staples you would need and you never had to leave your car. Great concept right?
It was for me especially when I would get he call while coming home from work. The milk and bread call. I didn’t want to have to park, walk, shop and wait in line forever. The drive through grocery store was an ideal solution.
They had no competition in the area so it should be a win win situation for Fresh Lane. The unfortunate part was that the store was located on the busiest and most congested corner of the main business street. It was hard to get into and with drivers not so polite these days it was even harder to get out of.
Needless to say this store deteriorated in less than a year. The customer service and selection was top notch. They definitely had the traffic flow but too much to cause a problem. This store had horrible site characteristics and no business can prosper without a good location.

Retailing Assortments

When I think of assorted retailing I think of the mall. My daughters love to go to the mall so they can hit all their favorite stores in one (long) day. Not so good for me but great for the retailers.

One of their favorite stores is “Justice”. With their age differences it sometimes hard to find someplace they both like. My oldest daughter says “this store has it all”. Going in I thought it was yet another trending kids clothing store..and it is. But, it does have more to offer. It’s a one stop shop for tweens and younger.

My older daughter is a tween and is now into clothes and fashion more than toys or gadgets. But, I have another daughter who is younger and has the opposite interest at this point. Justice is clever in solving this age gap interest dilemma by offering a wide assortment of merchandise.

The biggest pull to the store is the clothing variety. So, while my fashionable child tried on a mountain of clothes the younger one bounced around the store like a ping pong ball. There was just so much to look at.
One of the cleverest items they have are Webkinz. They have a wall of different kinds and every accessory you could possible put on a stuffed animal. Not to mention trading cards. If that is not enough they also have shoes, jewelry, purses, candy, electronics and make up. What more of a variety of assortments could young girls ask for in one store?

COMPETITORS

Everyone knows what completion among retailers’ means. That is the reason we get to bargain shop the competitive deals. So, I want to discuss a retailer that has made millions and has absolutely no competition. Her name is Sheri Schmetzer and she is the creator of Jibbitz.
Sheri was your everyday Mom who had an eye for flare. Millions of Americans wear Crocs and her family was no exception. To differentiate everyone’s crocs she decided to make them unique. She took rhinestones and clay and stuck them into the holes in the shoes. In no time at all friend and family took notice. Soon after that she was decorating their Crocs.
Her husband was an entrepreneur and very business savvy. He quickly took it to the next level by starting a website. They turned their basement into an assembly line factory. They employed ever friend and family members help to keep up with the stock piled orders. Sheri said on the Oprah Winfrey show that she would get so tired that she would hot glue her fingers together.
Eventually it was just too much for them to keep up with. They decided to outsource to Asia. Production went off the charts. The remarkable thing is how fast this idea took off. In less then 1 year of conception her product was being sold in 3000 stores.
This is where it gets cool. Her daughter went with a friend to their local public pool. By pure coincidence there happened to be a rep for Crocs there with his family. He noticed her Crocs and I am sure immediately saw dollar signs. He gave her a business card to give to her Mom. $20 million dollars later she still has zero competition and continues to expand her ideas.

Gentrification..... What?

I have never heard of this term gentrification. After I read up about it really was interesting. Downtown Fort Worth and specifically Sundance Square are perfect examples of this process. The Fort Worth Stockyards were the original lure that brought the foot traffic to the area. Tourist would wander around the corrals or the general stores for a souvenir or two. But, that was about it for entertainment. Downtown was not considered the safest place to hang out. Boy how that has changed.

I think it started for me when the Tandy Center opened an outlet mall and an ice skating rink. We now had a reason as a family to go downtown. The down side to that was that it was located just blocks from the “projects”. Not very appealing to tourist or locals for that matter.
That all change when the Bass brothers and years later Radio Shack came to town. When the Bass brothers built their towering buildings it was a statement in the skyline of Fort Worth. Not only did they bring jobs to the area but they also put their money into the Sundance Square area. Soon Bass Hall opened and brought in a diverse culture. The streets were lined with coffee shops and ornate landscaping. A place you could stroll through the streets with your family to eat ice cream and feel safe.

Radio Shack decided to move their headquarters to Fort Worth and specifically wanted to build where the projects were located. They did just that. Moving the projects helped people feel a little safer when downtown. Not to mention the cops on bicycles and horse back.
People soon took notice of the change and decided they wanted to live among it. Apartments and lofts are popping up everywhere. The first was the Fire Stone Tire Store. It was built in 1920 and revived into upper scale condos and apartments in 1999. They kept the retro look and it is cool. The newest and most impressive is the Texas & Pacific train station built in 1931. It is massive and very architecturally appealing. Especially to any young yuppie wanting the downtown life.

Sundance Square is a great place to go to do many different things. It is a case of gentrification gone good.

Adaptable McDonald's

You can’t drive more than 15-30 miles without seeing the big golden arches. It is the international sign of McDonald’s. Getting to go to McDonald’s is usually a treat especially if you are a kid. Not only do you get to eat those yummy greasy fries, but you also get to play on the indoor playground and video games. That is a typical trip to an American McDonald’s.

While living in Okinawa, Japan, I experienced a very different McDonald’s. From the outside it was a little more extravagant and appealing than your typical one. American McDonald’s usually have a young pimply kid to greet you ate the register. Most look quite unenthused and would rather be somewhere else. That was not the case in Okinawa. The Japanese for one take great pride in anything they do..no matter how menial. Once I walked inside it was comparable to a 4 star restaurant. I immediately notice the menu was in Japanese and was a little worried about how I would order. They did have great pictures of the meals and tons of soups to choose from. Just another way of adapting to the environment. As I walked up to the counter I was again pleasantly surprised. Everyone was smiling and wearing immaculate uniforms that included pristine white gloves. Nice right? As soon as they noticed I was American they gave us a menu in English. That was courteous and accommodating. I placed my order and promptly had it in my hands. I was taken aback by the size of my meal. It was the equivalent of what our Happy Meals are in the U.S. There was no such thing as “super sizing” in 1995. The food did taste different but good. The only thing I did not like was that it was not customarily to put ice in your drinks.

In Japanese culture eating is a slow enjoyable process. You will not find a drive thru or a massive playground with tons of screaming kids. That was probably the most relaxed meal I have ever had at a McDonald’s.

Retail Competitors

The bombing economy is on everyone’s mind lately. Depending on whom you talk to will depend on what out look you will get. Some think this is really not too bad and that we will soon come out of it. Others say we are in for the long haul and that it will get much worse before it gets better. But, regardless of that we still have to shop. The goal is to get the best deal.
Chapter 1 discusses competition among retailers with the same format. The first two retailers I thought of were Blockbuster vs. the Red Box. If you have never heard of or tried the Red Box you are really missing out on a great deal.

Everyone knows what Blockbuster is. It is the Wal-Mart of video stores…or at least it used to be. When Blockbuster came to our town it quickly put the “Mom & Pop” video store out of business. Who could compete with their selection?

A few years ago I was traveling and I decided to stop at McDonald’s in Missouri for some coffee. There outside the front door in the freezing cold was this big red kiosk that dispensed video. I thought it was kind of cool and went about my business. Then it happened. A big Red Box Kiosk was inside Albertsons. I, like many others, just walked past it with curiosity but did not go any farther. Eventually I decided to try it out. Following prompts on the touch screen I chose between about 100 DVDs, which includes all the new releases.. I swiped my card and for $1.08 a day I had my movie. When I am done with it I turn it back into any Red Box! Can life get much simpler than that? Within a few months everyone it seemed decided to try it. The lines grew with each passing week. So to keep up with the demand Wal-Mart got one. Then Albertsons got another one. So of course Wal-Mart had to get one more. Now even Walgreens is getting in on the action with on outside their doors. I see more people at the Red Box than at Blockbusters now. You do have to go to Blockbuster for games but I am sure that is not far behind for Red Box. In 2007 Red Box surpassed Blockbuster in the number of locations in the U.S. Who would have thought a movie kiosk with 50-200 dvds to select from could pass up the mega store that is Blockbuster?

MK 209 Intro

My name is Scot with one T. I love my family and I love my job. I have been in this area for alittle while now and really enjoy it. I look forward taking this marketing class and learning all that I can about the real world of marketing. Twit you later.