Lesson 4 Slides-Merchandising

• Lesson 6.4 – Merchandising

• Merchandising

• When the demand for licensed products is minimal, an organization may choose to handle their merchandising
• in-house

• 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

• LESSON 6.4

• Branding & Licensing

• Steps in the in-house merchandising process

• Merchandising

• 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

• LESSON 6.4

• Branding & Licensing

• 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

• Merchandising

• LESSON 6.4

• Branding & Licensing

• Outsourcing the merchandising effort

• Merchandising

• LESSON 6.4

• Branding & Licensing

• 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

• 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

• LESSON 6.4

• Branding & Licensing

• Four key considerations of on-site merchandising

• 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

• LESSON 6.4

• Branding & Licensing

• Best practices for selling on-site merchandise

• Merchandising

• 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

• LESSON 6.4

• Branding & Licensing

• 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

• LESSON 6.4

• Branding & Licensing

• Online Merchandising

• 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

• LESSON 6.4

• Branding & Licensing

• Online Merchandising

• Merchandising

• LESSON 6.4

• Branding & Licensing

• 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.

• Online Distribution Methods

• Merchandising

• LESSON 6.4

• Branding & Licensing

• Direct shipping to consumer
• In-store pickup

• Online Advantages

• Merchandising

• Easier to control inventory
• Opportunity to offer exclusive merchandise
• Opportunities to reach out-of-market
• consumers

• LESSON 6.4

• Branding & Licensing

• Reaching out-of-market customers

• Merchandising

• LESSON 6.4

• Branding & Licensing

• 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

• Online Disadvantages

• Merchandising

• 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

• LESSON 6.4

• Branding & Licensing