The retail sector revolves around 5 ‘P’s- The Product, Price, Promotion, Place and People. These 5’P’s remain the key elements of retail. Each should be considered with utmost importance.
Of all the key elements, Product is of first and foremost importance. It is the product, on which the whole retail depends. An item that is built or produced to satisfy the needs of a certain group of people can be termed as product.
The product can be tangible as well as intangible. In both cases, it plays the hero’s role in the retail market. The selection and designing of the product should be done with utmost care. Right type of product with better demand in market should be chosen, while entering into the retail market.
Extensive researches should be made during the development phase of the products. Marketers should make an effort to make their product unique and hence attractive from each of its competitors, for better results.
Once complete idea about the product is established, pricing decisions can be made. Quantifying the value of an object to the buyer at a particular time can be termed as pricing. Among the five pillars, pricing only generates revenue. This factor determines the survival of the firm. Pricing has an important role in shaping the profit margin, demand, supply and marketing strategy.
Pricing plays a key role in customers’ decision making process. The demand reduces if the price is too high. Low price will not generate enough revenue. Also, a low price means an inferior good to majority of customers. In short, price is the factor that shapes perception of good in customers’ eyes.
Strategies and ideas implemented by marketers to make a reach into the targeted group is termed as promotion. It includes sales organisation, public relations, advertisements, and sales promotion.
Promotions can be done through media including the print, visual and vocal media. In this online era, social media remains an effective platform for promotion. While advertising in print media like newspapers and magazines, and commercials in television and radio are expensive, making a promotion idea in social media like Facebook, twitter etc. costs very less.
Word of mouth is another powerful promotion method, though they remain an informal means of communication. Personal opinions of customers are important as they have a great reach into the public, even through the social media.
Marketing is all about putting right product in right place at right time. Identifying a location with high potential to make a huge number of clients is an important factor of retail business. The real importance of this factor is that it is the only thing that competitors cannot imitate and so it can give a strong competitive advantage.
Proper placement and distribution of the product is really important. It is a long term decision and a long term capital investment. A well located store can attract more customers and hence make the supply and distribution easier.
People include both the customers as well as the employees. While stepping into retail business, thorough researches should be made to ensure if there are enough people in the target market with a demand for the product.
Also, the employees who sincerely work for the company have a lot to contribute for the success of the company. Since they are the ones who deliver service, they play a key role in providing customer satisfaction, especially in brick and mortar stores. Through excellent conduct and communication, the committed employees can attract more customers and thus improve sales.
In short, each of the ‘P’s are important in the retail sector.