Retailing 8th Edition by Patrick Dunne,Robert Lusch, James Carver

Exercise 2

In this chapter, you learned that a major determinant of retail performance is how broadly or narrowly you define your market. In addition, when planning your retail business it will be important that you develop your retail marketing strategy to appeal to this particular market. For example, a women's apparel store could cater to all age groups, professional working women, or teens; it could also target various income groups such as low, moderate, or high income. Further, it could target women of different sizes from petite to full-figured.
For the store you are planning, assume that there are 21,000 households in your community and that these are within a reasonable driving distance. You have determined that if you broadly define your store's market, 64 percent of households in the community would be shoppers at your store and would shop there an average of 3.3 times per year. On the other hand, if you define your market much more selectively by focusing on a well-defined niche, you estimate only 26 percent of households would shop your store; however, they would shop an average of 9.2 times annually.
In this situation, would a broadly or more narrowly defined market create more customer visits to the store (Hint: Total store visitors, also referred to as traffic, is equal to the total number of households in the market multiplied by the proportion that would shop your store, multiplied by their average shopping frequency.) What other factors should you consider when deciding how narrowly or broadly to define your market