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Retail Communication Mix

Molton Brown

Two of the retail communication mix that is adopted by Molton Brown are:

Store Atomosphere and Visual Merchandising

At Molton Brown, it has a quiet and contemplative atmosphere which leave the customer with an impression of a premium brand that Molton Brown wishes to convey. Often, customers unknowingly spend longer time in the shop due to the aroma of the products, soothing music, the ambience and the wide aisle which make them feel comfortable.

Besides that, products are grouped according to categories in an open and glass fronted cabinets and are displayed in a clean, simple and contemporary manner to ease the search of products for the customers. New arrivals or impulse-buying products are often placed in-front of the store to attracts customers into the store. Store displays are back-lit, visually relaxing and subtly elegant. Molton Brown manages the tester experience by providing a stone sink to test hand-washes and body lotions that can be a welcome refreshment to tired city shoppers.

Reason: To allow each shopping experience in Molton Brown to be pleasurable.

Sales Promotion

In Molton Brown, they use gift vouchers as part of their sales promotion as it can be purchased as a gift to friends or family. Gift voucher helps to prevent an unwanted gift for the customers' friends or family as they can decide on what they want to buy with it. Other than gift vouchers, Molton Brown has other promotions such as discounts and free delivery when an order meets a certain amount.

Carl’s Junior

· I saw two examples of poor customer service.

#1 I waited for more than five minutes just trying to get a refill on beverages, which I never did get. Three employees, including the manager, saw me waiting and ignored me. I could see that they were busy but how long would it have taken to refill two sodas? Why don't they put a soda machine near the counter like every other fast food restaurant?

· An elderly lady next to me had a question about her order. There was a large packet of fries on the tray. She told the guy working the register that she didn’t order it. He argued with her! Not just once, but at least three times he told her that yes, she had ordered it. She ordered small fries. He didn’t understand what she asked for but wouldn’t admit that it was his fault. This kind of customer service leads to loss of customers. I don’t think I’ll be eating there any time real soon.

1. Time waiting- No customers should be left standing at one corner. The very least a waiter or waitress can do is to let the customer know that he or she has been taken note of and will be attended shortly. Never, never, never ignore a customer.

2. Even though the customers may be wrong but it is bad customer service etiquette to argue with them, and in this situation the customer was right and had to be told three times that she was wrong.

3. The place would lose its customers and they will lose the sales. The average business spends six times more to attract new customers than it does to keep old ones. That says a lot about the importance of putting the customer first.

4. Statistics show that the average dissatisfied customer will tell 8 to 10 people about their problem. One in five of those will share that with 20 others. So you can see how repeated offenses of poor customer service can quickly snowball into the downfall of a business.

5. Being polite and courteous should be observed by all the staffs there. This is to make the customers feel good and want to come back again.

Customer service is the provision of service to customers before, during and after a purchase.

It is often categorized into two different headings:
Customization
Standardization
Firstly Customization approach: encourages the individual retailer, outlet or sales person to cater or tailor their service according to the needs, wants or desired feature that that particular customer prefers.

For example during our visits to Molton Brown the sales staff would
address us by name
find out about our preferences of smell and scent
know what type of products are we looking for, such as gifts, personal use, perfume, shower gel

However we noticed that the only weak link for this method was the inconsistency of the service level.

For example as we visit Molton Brown in a group, there would be a few staffs that would be allocated to us and after the shopping experience, some of us left the store feeling well taken care of while others felt that their sales assistant could have done better.

Hence when such a thing arises, as when one staff performs excellent, the rest of her colleges are bound to do less better.

Secondly Standardization approach: they are a set of rules and procedures that are implemented for the staffs to follow consistently.

For example during our visits things such as “hi welcome”, “good evening”, “how may I serve you”, “thank you and come back again” are all basic steps that the sales staff have to follow.

Now I would like to share the various service characteristics that we observed:
Reliability-
When we made a purchase and paid, the billing was accurate and we did not have to worry about whether the cashier had cheated us or not.
As Fessie has a skin allergy, we needed to know if the product contains certain chemicals that would irritate it. The bottle behind states exactly every ingredients that are used to make the product.

Assurance-
When the purchase was made, we were guaranteed that if the product were to turn bad, we would be able to come back and change for another one.
If we did not like the flavour or scent we are allowed to come back and change for another one provided if the bottle was still unopened.

Tangibility-
The staffs were very pleasant and they spoke with confidence. They seemed to know their products very well and were sure of the ingredients used, the prices as well as the intended purpose of the product.

Empathy-
Liked I mentioned above, they found out our names and remembered it throughout the entire visit and addressed us by our names whenever they were to speak to us.
When we had one of our purchase wrapped as a gift, they had a special equipment to label the paper bag as well as the bottle with the person’s name.

Responsiveness-
Whenever we needed help or attention, they were quick to respond and were all ready to open the bottle for us to try the scent.
Before we arrived we called to make sure that they were open, and they took no more than 3 seconds to answer the call.

Merchandise Presentation & Store Design

Free-Form (Boutique) Layout

Fixtures and aisles arranged asymmetrically

• Pleasant relaxing ambience
• Small store experience
• Inefficient use of space
• More susceptible to shoplifting – salespeople cannot view adjacent spaces
• Used in specialty stores and upscale department stores

Store Design

• Wide aisles -> ease of movement
• Convenient to find -> according to the product & variety

Display Areas

Feature areas

• Promotions items & signages are place near entrance
• Display new products on the windows.

Human Resource Management

3 HR PRACTICES - UNIQUELY SINGAPORE!

Below are some examples of unique Human Resource Practices.

IKEA

• IKEA has a strong belief in the importance of family, and it shows in their HR policies as well as their store design and features. IKEA offers co-workers the opportunity to try new positions and actively encourages co-workers to try 10 jobs in 10 years.

• In their corporate headquarters, dress is casual and employees enjoy the opportunity to bring their kids to work on occassion. Co-workers enjoy their own private cafeteria where there's more than just meatballs, and there are even 'quiet rooms' for co-workers in the stores - a secluded place to quietly relax or even meditate while on a break or before or after work.

ESPLANADE

• Many companies have taken steps to put prospective customer service staff through various stages of testing. Often intangible attributes like "a great personality", or a "sense of being ready to help out" are factors for hiring a candidate.

• One example would be when the Esplanade-Theatres on the Bay hired part-time ushers, who was hired depended on the candidates' smiles.

Workforce Development Agency(WDA)

1. Collaboration with key agencies and associations to develop and implement an effective engagement and leadership development strategy with Retail CEs and HR managers to educate them on the importance of training investment and business outcomes, as well as to highlight the rationale of Retail CET Framework and courses. For instance, this can be done through mounting breakfast meetings, priority conversations or industry forums with CEs and HR managers. Renowned retail experts or speakers will also be invited to speak on new ways and ideas of retailing and retail training.

Price Management---- EVERYDAY LOW PRICE?!?!?!?!

What are the methods?

1. Demand-Oriented- whatever price the customer is willing to pay
2. Cost-Oriented- fixed percentage over cost price of product
3. Competitors Oriented- similar to competitor's pricing
4. Mark up pricing- a markup is added on to the total cost incurred by the product
5. Bait and Switch- introduce customer to a cheaper product first

How retailers set their price?

1. Cost of goods- cost of importing the goods
2. Forecasted sales- whether it is feasible
3. Demand- whether the product is in demand
4. Price- how much the customer are willing to pay
5. Customer Income- how much customer earns
6. Need for product- do customer need it
7. Availability of products- whether the customers have a wide choice to choose from
8. Frequency- time spent on product

Price Adjustments

1. Coupons- discount
2. Rebates- money that is returned to customer based on a portion of money spent
3. Variable discount- weekend special, location

Prices to stimulate Sales

1. Leader Pricing- price priced lower than other competitors
2. Price Lining- limited pricing to predetermine price points e.g handphone plans
3. Odd Pricing- price that end with a odd (6.77) or round number ($46)

• Hence we feel that for a premium brand such as Molten Brown, it should be offering a high mark up pricing and the prices should not be determined by competitors products.
• However from visits to the store we noticed that they used Bait and Switch method- as people may be attracted to the low prices that Molten Brown offers at such a high quality.
• Molten Brown from what we observed does not practise leader pricing nor coupons but occasionally they offer variable discount.
• Molten Brown targets at people with money who can afford luxurious goods to pamper themselves thus enabling them to set their price according to customer's income.

Merchandise Management

The Power of Optimization

Your Experience- Buyers rejects you. They do not understand or appreciate your products.

Your Solution- Learn to understand and use Category Management to your advantage and earn money.

Category Management is the process of managing a retail business with the objective of maximising the sales and profits of a category. -To help retailers and suppliers implement Category Management quickly and effectively, or improve their existing processes RETAIL VISION is required.

Basically, Molton Brown has broken down their products into the categories as follow:

1. Gifts
2. Men
3. Bath & Body
4. Hair
5. Make-up
6. Skin care
7. Hand Wash & Lotion
8. Candles & Scent
9. Travel
10. Old Friends

Where does my product fit in?

we suggest-

zero in on the category your product belongs to by undertaking field research at the stores that belong to the chains you want to contact

then

register ALL the products and their street prices that the selected retailer has in the assortment that could be in the category

after

start focusing on the chains with the largest number of products in your category as they(the stores) obviously understand your product best and are more likely to test your product

Developing your Category strategy

Once you know which category (and cell within the category) your product belongs, you can start developing your strategy.
Focus on one of the following 3 strategies:

1. Pushing out competing product-

Evaluate the strengths and weaknesses of your product compared to a specific competing product, in Molten Brown's case, compare the sales of the different scent and flavours in the category that the customer prefers.-All retailers are looking for category killers. A category killer is a product that generates almost all the sales in a category.

2. Expanding a cell (on behalf of another cell)

not all perfumes and scents and body care products will go in the store, hence we can increase the hype on a certain non-moving item and make it seem as a whole collection in itself.

3. Establishing a new type of product (and category).

some products after certain time do not really fit into the existing category they were originally placed in. Selling-up strategy is an old trick where retail attracts customers with low prices that often mean lower profits.

Category ambassadors

So even though it is still the retail chain that will decide if your product will be part of the assortment a category ambassador can actually help by becomming YOUR ambassador.

all about saving cost!!!

By analyzing detailed spending, transactional and pricing data, and continuously monitoring the supply markets, we can

1. routinely identify and implement solutions to further reduce maverick purchasing
2. drive incremental unit-cost reductions through additional sourcing, appropriate specification changes, substitution, better demand management
3. actively target cost-avoidance opportunities in appropriate commodities.

Rationale behind the category management

• Due to customer fragmentation, category management can tuned to various customer needs
• Ease of searching a product
• Creating a pleasant atmosphere so that customers will stay longer
• Assist promotions planning
• Assistance with consumer behavioral/shopping research

at the end it is all about the categories being defined by the customers and making it easier for the customers to get an overview of the products available.

3 Elements in Retail Strategy Target Market

Target Market

To define a target market for your business plan, you should research the potential buying audience for your product. This could range from millions of people if you are starting an online business, to a few thousand individuals if you are opening a retail store in a small town.

1. Study your product or service and determine the most likely consumer.
2. Define the age range, gender, marital status, and income level of the individual most likely to be your customer. 3. Explain the motivations for purchasing your product or service.
4. Is it a necessity or luxury?
5. What value does this product bring?

It's best not to assume or guess.

this is what we decided are the target markets of molten brown.

• Both gender aged 21 & above with a steady income
• We feel that they are targeting individuals who are self-conscious
  

We feel that the target market is expanding due to the growing interest in going green as well as being health conscious. Molton Brown also faces little competition in the industry (body shop, l'occitane, crabtree and evelyn) therefore being able to have more profits.

Retail Format

Basically in a retail format the retailers make their products available to customers in numerous ways at the ease of satisfying a need by the consumer.

In our perspectives, Molton Brown is trying to potray a premium body care product image, by enabling their customers to have ease to choose from a huge array of items at their comfort or even their own home.

• Molton Brown is a specialty store and is located at Raffles Hotel lobby and Takashimaya Shopping Center to uphold an premium brand image
• Molton has a online store for e-buying and home delivery of products.

Bases for Building Sustainable Competitive Advantages

• Exclusive merchandise - They endeavour to use as many naturally derived ingredients as possible, sourced from sustainable sources around the world.

• Their range of products is unique and therefore our ingredients are unique as well. Using the finest ingredients that they source from all over the world depending on the kind of product we want to create (eg: inspiring wild indigo from the Himalaya mountains, relaxing yuan zhi root from China or maracuja passion flower seed oil from the Amazon)

• They have very committed staff with experience and ready to help with any difficulties, are very friendly and warming when it comes to serving us - being consistent with every customer.

• They have a very well organised supply chain back in London, making their supply arrive on time and always available.

• Molton Brown's iconic bottle is fully recyclable, and will be launching ranges in 2008 taking advantage of the most recent environmental advances in packaging. As a business they are currently constructing

1. A five-year plan to become a market leader in environmental ethics

2. Focussed on the reduction of carbon emissions and waste.

• Molten Brown supported during 2008 Cancer Research UK and ChildLine, making it to have a long history of supporting many worthwhile causes.

The Retailing Environment

To discuss more about the retailing environment, we chose Molton Brown as our example.

Molton Brown is a specialty store which started out as hair salon in London, 1973.


By 1980s, Molton Brown began selling plant-based make-up, hair, body, skin and grooming products. As they became famous, they were approached to supply top-end stores,airlines, and hotels in cities around the world.

Their aim is to produce natural products using plants, flowers and marine products and have been against animal testing. Their mild products enable them to be used by people who have sensitve skin

Now you can experience their creations in more than 70 countries world-wide, in their emporium, spas, online and in world's leading luxury hotels and airlines.


Variety & Assortments

They have a wide range of products from

• Men's Grooming - shaving, body wash, cologne, hair wash etc
  
• Bath & Body - body shower, body soother, body cream, body shimmer, body lotion etc.
  
• Hair - hairwash, hair condition, hair treatment
  
• Make Up - face, lipstick & gloss, eye make-up
  
• Skincare - cleansers and moisturiser
  
• Hand Wash & Lotion - hand wash and hand lotion
  
• Candles & Scent - candles and roomspray
  
• Travel packs - travel kits and leather bags

Two Challenges faced by Molton Brown

Not well-known among most Singaporeans and they are only located at Takashimaya and Raffles Hotel.

High competition in the industry e.g. Body Shop, Crabtree & Evelyn

• Doing a market research finding out the consumers' behaviour in Singapore
• Creating brand awareness to the public through roadshows or advertising highlighting the Point-Of-Difference.
• Using celebrities to create buying intention among the consumers.

THIS BLOG WILL BE DEDICATED TO DISCUSS LEARNING POINTS on

Retail Store Operations & Management