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Lesson 6.4 – Merchandising

Lesson 6.4 – Merchandising. Branding & Licensing. LESSON 6.4. Merchandising. In-house Merchandising: Refers to managing the merchandising process within the organization itself, rather than outsourcing or acquiring licenses

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Lesson 6.4 – Merchandising

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  1. Lesson 6.4 – Merchandising

  2. Branding & Licensing LESSON 6.4 Merchandising • In-house Merchandising: • Refers to managing the merchandising process within the organization itself, rather than outsourcing or acquiring licenses • The key benefit of in-house merchandising is the probability of increased profits When the demand for licensed products is minimal, an organization may choose to handle their merchandising in-house

  3. Branding & Licensing LESSON 6.4 Merchandising Steps in the in-house merchandising process 1) Design the logo and slogan or tagline (if it is not already available) 2) Determine merchandise type, quality and quantity 3) Interview local merchants (vendors) and select the company that can best fit the organization’s needs 4) Determine distribution outlets 5) Train sales staff 6) Prepare on-site merchandising strategies

  4. Branding & Licensing LESSON 6.4 Merchandising Outsourcing the merchandising effort If an organization feels an in-house merchandising approach may not be the most efficient strategy, they may choose to outsource the effort to a third party

  5. Branding & Licensing LESSON 6.4 Merchandising For example, last year the Big 10 Conference signed an exclusive five-year deal with sports retail vendor MainGate to sell merchandise for its football championship and the men’s and women’s basketball tournaments

  6. Branding & Licensing LESSON 6.4 Merchandising • The primary purpose is to maximize income for a sports or entertainment event Organizations maximize income through the sales of food and beverage and merchandise On-site Merchandising: Refers to the process of selling merchandise at the physical location of the event

  7. Branding & Licensing LESSON 6.4 Merchandising Four key considerations of on-site merchandising • The location of where the merchandise is being sold • The physical layout and appeal of where the merchandise is being sold • How well the sales operation is performed • The appeal of the merchandise or product itself

  8. Branding & Licensing LESSON 6.4 Merchandising Best practices for selling on-site merchandise • The heaviest traffic for merchandising is upon arrival and departure • Test marketing is important to ensure the effectiveness of a good or service • Training of sales personnel varies with the event

  9. Branding & Licensing LESSON 6.4 Merchandising Making merchandise available online opens up a new sales channel for a sports or entertainment organization to purchase related goods and services Online Merchandising: Refers to the process of selling merchandise on the Internet

  10. Branding & Licensing LESSON 6.4 Merchandising Online Merchandising • Organizations maximize income by providing a customized shopping environment and allowing consumers access to a wider variety of products and services • Global e-commerce sales surpassed $1 trillion in 2013

  11. Branding & Licensing LESSON 6.4 Merchandising Online Merchandising Overall, eMarketer estimates, US retail e-commerce sales will reach nearly $39 billion in 2013, up 56.5% over 2012 and almost triple the amount spent in 2011.

  12. Branding & Licensing LESSON 6.4 Merchandising Online Distribution Methods • Direct shipping to consumer • In-store pickup

  13. Branding & Licensing LESSON 6.4 Merchandising Online Advantages • Easier to control inventory • Opportunity to offer exclusive merchandise • Opportunities to reach out-of-market consumers

  14. Branding & Licensing LESSON 6.4 Merchandising Reaching out-of-market customers Kansas State University’s online store sold $131,500 of Wildcats merchandise and of that revenue, Kansas residents were responsible for just $56,100 of the purchases

  15. Branding & Licensing LESSON 6.4 Merchandising Online Disadvantages • Security concerns in making transactions online • Potentially higher distribution (delivery) costs • Consumers inability to touch, feel or “test-drive” products before buying can be a deterrent and lead to higher return rates

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