Final answer:
Employee compensation is not a front on which retailers directly compete for target customers. Price, service level, product selection, and customer experience are the major factors influencing consumers' shopping decisions.
Step-by-step explanation:
Among the five major fronts retailers compete on, employee compensation is NOT one where they compete for target customers directly. Retailers typically compete based on the price for the value offered, service level, product selection, and customer experience. These factors directly influence a customer's decision to shop at a particular retailer. A major factor in retail success, as seen with Amazon, is how they utilize their production model and cost structure to offer competitive pricing. Additionally, in imperfectly competitive markets, like monopolistic competition, there are numerous firms selling differentiated products that compete for customers with unique strategies regarding pricing and product offerings. Lastly, supply and demand, as well as competition, are critical in determining the cost of raw materials, retail prices, and wages, which indirectly affects consumer choices.