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October 20, 2012

Popular terms and concepts in Retailing & Retail Marketing

1.      Slotting fee: A slotting fee, slotting allowance, pay-to-stay, or fixed trade spending is a fee charged to producer companies or manufacturers by supermarket retailers in order to have their product placed on their shelves. The fee varies depending on the product, the manufacturer, and market conditions.

In addition to slotting fees, retailers may also charge promotional, advertising and stocking fees. Many retailers earn more profit from agreeing to carry a manufacturer's product than they do from actually selling the product to retail consumers.

Many argue saying that slotting fees are unethical as they create a barrier to entry for smaller businesses that do not have the cash flow to compete with large companies.

2.      Push money: Push money is a special incentive that is offered to a retailer in exchange for focusing sales efforts on a particular product or brand of products. This incentive may take the form of a special commission for all generated sales related to the specified product or brand, or come in the form of some other type of compensation, such as a paid vacation or holiday.

3.      Point-of-purchase displays, or POP displays: are marketing materials or advertisements placed next to the merchandise it is promoting. These items are generally located at the checkout area or other location where the purchase decision is made. For example, the checkout counters of retail stores are cluttered with cigarette and Chocolates and many other impulse purchase category items.

4.     Point of Sale (POS):  refers to the area of a store where customers can pay for their purchases. The term is normally used to describe systems that record financial transactions. This could be an electric cash register or an integrated computer system which records the data that comprises a business transaction for the sale of goods or services

5.     Mom and Pop stores/Kirana shops: A small, independent, usually family-owned, controlled, and operated business that has a minimum amount of employees has only a small amount of business volume and is typically not franchised, therefore open for business only in a single location. Typically running on a very tight budget and wafer thin margins they are profitable only because the entire family pitches in and run it as a business.

6.      Brick and mortar store:  refers to retail shops that are located in a building as opposed to an online shopping destination, door-to-door sales, kiosk or other similar site not housed within a structure. Brick and mortar are the traditional touch, feel and tryout type of supermarkets. They are real and not virtual.

7.      Planograph: Visual description, diagram or drawing of a store's layout to include placement of particular products and product categories.

8.     Comp sales: Comparable-store sales is a measurement of productivity in revenue used to compare sales of retail stores that have been open for a year or more. Historical sales data allows retailers to compare this year's sales in their store to the same period last year.

9.   Cyber Monday: Cyber Monday is one of the busiest shopping days of the year for online retailers. This comes after the Thanksgiving weekend. Retailers notice a spike in sales on this day as many consumers who were too busy to shop over the Thanksgiving weekend or did not find what they were looking for, headed to the web on Monday from work or home to find bargains.


  1. Its nice to hear terms and concepts in retail marketing and my question to you is how retail like big bazar effecting the small kirana and will they survive in this competitive world? and do you encourage FDI in retail?

  2. Yes and no, FDI is welcome as long as it can improve efficiency and make things better for the consumers and for the producers. But it does not seem to be happening. And India is too big a country and Kirana shops will survive and will prosper.

  3. Dear Sir, kindly explain SKU(stock keeping unit):)

  4. Professor
    Look forward to your review of my book 'Integrated Retail Marketing Communication' published by PHI
    Many Thanks......realll nice blog

    g p sudhakar