RETAILING INNOVATION AND MARKETING PERFORMANCE OF GROCERY RETAILERS IN CROATIA

Abstract

Increasingly dynamic and competitive marketing environment places new demands on retailers. During the last two decades retail sector has undergone through a tremendous changes fuelled by innovative management thinking and development of technology. Retail companies that developed and/or adopted innovations faster gained competitive edge that enabled them to grow faster and outperform the competition. The major changes in the sector included increase in market concentration, shift of power in the channels of distribution, mergers and acquisitions, increased internationalization, widespread use of technology and innovative marketing concepts in the area of store formats, merchandising, category management, ECR, loyalty schemes, branding and so on. In the midst of economic crisis that globally prevails, at the time when retail consumer spending had dropped sharply in many countries, innovations may prove to be fundamental fuel for further retail growth. The focus on efficiency of operating formats or even new retailing models might become the prime objective and thus lead to replacement of less efficient operating models and further and faster restructuring of the sector. The internationalization of Croatian retail market in a last decade led to faster diffusion of innovation and caused high concentration of the market. In this paper connection between retail innovations and marketing performance of the Croatian retailers has been empirically investigated pawing the way for objective forecasting of future trends in the Croatian retailing.