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“A study of customer perception on the marketing strategies followed by PANTALOON for brand building”
Faculty Guide: Nageshwar Rao
Submitted By MD. RASHID KHAN 8NBHD008
A THESIS ON
“A study of customer perception on the marketing strategies followed by PANTALOON for brand building”
By MD. RASHID KHAN
8NBHD008 (MBA 2008-10)
A REPORT SUBMITTED IN PARTIAL FULFILMENT OF THE REQUIREMENT OF MBA PROGRAM (2008-10)
This is to certify that the Management Thesis entitled as, “A study of
customer perception on the marketing strategies followed by PANTALOON for brand building” Submitted to INC ASIM in partial fulfillment of the requirement for the award of Master of Business Administration is record of original, project work done by me during the period of study in under the supervision of Mr. Nageshwar Rao (Faculty Supervisor).
Place: HYDERABAD Date:
MD RASHID KHAN (8NBHD008)
TABLE OF CONTENTS
◙ ACKNOWLEDGEMENT ◙ LIST OF TABLES ◙ ABSTRACT/SUMMARY ◙ CHAPTER 1 :INTRODUCTION o Objectives o Limitations o Methodology
◙ CHAPTER 2: INDUSTRY PROFILE
◙ CHAPTER 3: COMPANY HISTORY AND PROFILE
o COMPANY HISTORY o COMPPANY PROFILE o MAJOR PLAYER IN RETAIL INDUSTRY o COMPANY STRATEGIES
◙ CHAPTER 4: THEORITICAL BACKGROUND (ABOUT TOPIC )
◙ CHAPTER 5: REVIEW OF LITERATURE ◙ CHAPTER 6: EMPIRICAL ANALYSIS ◙ CHAPTER 7 : FINDINGS ◙ CHAPTER 8: CONCLUSION ◙ CHAPTER 9 : ANNEXURES ◙ CHAPTER 10 : BIBLIOGRAPHY
At the outset, I thank my faculty supervisor Mr.Nageshwar Rao for coordinating the project work and giving me necessary directions on doing this project to the best of my abilities. Heartfelt thanks to all the persons whose ideas, critical insights and suggestions have been valuable in the preparation of this report. I also thank Mr. Trinath (Principal of our INC Adam Smith), who has sincerely supported me with the valuable insights into the completion of this project. I am grateful to my friends who have helped me in the successful completion of this Project.
MD. RASHID KHAN 8NBHD008
LIST OF TABLE AND ILLUSTRATIONS
1) Indian retail market 2) Retail formats available in India 3) Fastest growing retail formats in India 4) Fastest growing retail segment in India
This report discuss about a customer perception and strategies used by retail companies. My topic is customer perception on strategy followed by pantaloon for brand building. To make a good brand image a company need to make a good strategy and all aspects of business that affected by that strategy. As we all know customer is the king of the market the have the right to go any where. A customer thinks very differently that called consumer behavior. A customer wants to get the full value of their money whatever he buys he wants full satisfaction from that product and if the company succeeds to satisfy their customer then the company can easily make their brand image. So the company need to make good strategy and first starts with 4p’s of the company. Product, price, place, promotion these are the most important things to remember in mind. And the porters generic strategy cost leadership, product differentiation and focus these strategies help company to compete with its competitors.
To find out the different strategies used by the company to increase the sales. To find out how this strategies useful to company as well as customers. To find out customers satisfaction level. To get a right feedback from the existing customers.
Pantaloon to hive off Big Bazaar, Food Bazaar
The sales person is busy in our routine work so they refuse to give information. Most of the sales person is not give the information to the customers want and needs. Some store information is confidential.
For Example: - Future plan, Accounting information.
Most of the time customers are saying that they are busy or I have no time.
1. The study involves the primary data which is collected through questionnaire, interview, and observation. 2. It involves use of secondary sources such as web and other research articles printed by various financial institutions and other journals and magazine. 3. It involves analysis and tabulation of data which is collected from customers is done by various means such as line graphs, pie charts and bar graphs. 4. The project involves the study of customer’s perception.
ABOUT RETAIL INDUSTRY IN INDIA
Retail is India's largest industry. It accounts for over 10 per cent of the India's GDP and around 8 per cent of the employment. Retail sector is one of India's fastest growing sectors with a 5 per cent compounded annual growth rate. India's huge middle class base and its untapped retail industry are key attractions for global retail giants planning to enter newer markets. Driven by changing lifestyles, strong income growth and favorable demographic patterns, Indian retail is expected to grow 25 per cent annually. It is expected that retail in India could be worth US$ 175-200 billion by 2016. The organized retail industry in India had not evolved till the early 1990s. Until then, the industry was dominated by the un-organized sector. It was a seller’s market, with a limited number of brands, and little choice available to customers. Lack of trained manpower, tax laws and government regulations all discouraged the growth of organized retailing in India during that period. Lack of consumer awareness and restrictions over entry of foreign players into the sector also contributed to the delay in the growth of organized retailing. Foundation for organized retail in India was laid by Kishore Biyani of Pantaloon Retails India Limited (PRIL). Following Pantaloon's successful venture a host of Indian business giants such as Reliance, Bharti, Birla and others are now entering into retail sector. A number of factors are driving India's retail market. These include: increase in the young working population, hefty pay-packets, nuclear families in urban areas, increasing workingwomen population, increase in disposable income and customer aspiration, increase in expenditure for luxury items, and low share of organized retailing. India's retail boom is manifested in sprawling shopping centers, multiplex- malls and huge complexes that offer shopping, entertainment and food all under one roof. But there is a flip side to the boom in the retail sector. It is feared that the entry of global business giants into organized retail would make redundant the neighborhood Karana stores
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resulting in dislocation in traditional economic structure. Also, the growth path for organized retail in India is not hurdle free. The taxation system still favors small retail business. With the intrinsic complexities of retailing such as rapid price changes, constant threat of product obsolescence and low margins there is always a threat that the venture may turn out to be a loss making one. A perfect business model for retail is still in evolutionary stage. Procurement is very vital cog in the retail wheel. The retailer has to fight issues like fragmented sourcing, unpredictable availability, unsorted food provisions and daily fluctuating prices as against consumer expectations of round-the-year steady prices, sorted and cleaned food and fresh stock at all times. Trained human resource for retail is another big challenge. The talent base is limited and with the entry of big giants there is a cat fight among them to retain this talent. This has resulted in big salary hikes at the level of upper and middle management and thereby eroding the profit margin of the business. All the companies have laid out ambitious expansion plans for themselves and they may be hampered due lack of requisite skilled manpower. But retail offers tremendous for the growth of Indian economy. If all the above challenges are tackled prudently there is a great potential that retail may offer employment opportunities to millions living in small town and cities and in the process distributing the benefits of economic boom and resulting in equitable growth.
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PRESENT INDIAN RETAIL SCENARIO
The retail industry is divided into organized and unorganized sectors. Over 12 million outlets operate in the country and only 4% of them being larger than 500 sq ft (46 m²) in size. Organized retailing refers to trading activities undertaken by licensed retailers, that is, those who are registered for sales tax, income tax, etc. These include the corporate-backed hypermarkets and retail chains, and also the privately owned large retail businesses. Unorganized retailing, on the other hand, refers to the traditional formats of low-cost retailing, for example, the local kirana shops, owner manned general stores, paan/beedi shops, convenience stores, hand cart and pavement vendors, etc.
* Unorganized market: Rs. 583,000 cores
* Organized market: Rs.5, 000 cores * 5X growth in organized retailing between 2000-2005 * Over 4,000 new modern Outlets in the last 3 years * Over 5,000,000 sq. ft. of mall space under development * the top 3 modern retailers control over 750,000 sq. ft. of retail space * Over 400,000 shoppers walk through their doors every week * 47 global fortune companies & 25 of Asia's top 200 companies are retailers * Biggest player in India is Pantaloon Retail India Limited. Growth in organized retailing on par with expectations and projections of the last 5 Years: on course to touch Rs. 35,000 corers (US$ 7 Billion) or more by 2005-06The growth factors of the retail sector of Indian economy:
• • •
Increase in per capita income which in turn increases the household consumption Demographical changes and improvements in the standard of living Change in patterns of consumption and availability of low-cost consumer credit
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Improvements in infrastructure and enhanced availability of retail space
Entry to various sources of financing
EVOLUTION AND TRENDS IN ORGANIZED RETAILING FORMATS AND RETAIL OUTLETS
Historical Indian retail market consisted of weekly markets, village fairs and mela’s and the 19th century gave birth to the retail outlets which took the form of convenience stores, Mom and Pop stores/ kirana stores. This helped the consumers on to stick to a particular store for their day to day requirements and also avail the credit purchasing facility. And in the 1980’s people have seen the new formats like supermarket, departmental stores and discount stores entering into the Indian retail space. In less than a decade hypermarkets have gained all the applause of the retail market and stood above all the other formats by bringing in the concept of “one stop shopping.” This stood as an opening door for the new generation of the retail industry. And very soon the malls became the trend setters in the new millennium. This has coined the term of ‘shoppertainment’ (shopping and entertainment) which can be attributed to the changing life styles of the people. Hypermarket: It is the largest format in Indian retail so far is a one stop shop for the modern Indian shopper. Merchandise: food grocery to clothing to spots goods to books to stationery. Space occupied: 50000 Square feet. and above. SKUs: 20000-30000. Example: Pantaloon retail’s Big Bazaar, RPG’s Spencer’s (Giant), Vishal mega mart. Supermarket: A subdued version of a hypermarket.
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Merchandise: Almost similar to that of a hypermarket but in relatively smaller proposition. Space occupied: 5000 Sq. ft. or more. SKUs: Around 10000. Example: Nilgiris, Apna Bazaar, Trinethra/more. Convenience store: A subdued version of a supermarket. Merchandise: Groceries are predominantly sold. Space occupied: Around 500 Sq. ft. to 3000 Sq. ft. Example: stores located at the corners of the streets, Reliance Retail’s fresh Department store: A retail establishment which specializes in selling a wide range of products without a single prominent merchandise line and is usually a part of a retail chain. Merchandise: Apparel, household accessories, cosmetics, gifts etc. Space occupied: Around 10000 Sq. ft. – 30000 Sq. ft. Example: Landmark Group’s LifeStyle, Trent India Ltd.’s Westside. Discount store: Standard merchandise sold at lower prices with lower margins and higher volumes. Merchandise: A variety of perishable/ non perishable goods. Example: Viswapriya Group’s Subiksha, Piramal’s TruMart.
Specialty store: It consists of a narrow product line with deep assortment. Merchandise: Depends on the stores Example: Bata store deals only with footwear, RPG’s Music World, Crossword.
MBO’s: Multi Brand outlets, also known as Category Killers. These usually do well in busy market places and Metros. Merchandise: Offers several brads across a single product category.
Kirana stores: The smallest retail formats which are the highest in number (15 million approx.) in India.
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Merchandise: Mostly food and groceries. Space occupied: 50 sq ft and even smaller ones exist. Malls: The largest form of organized retailing today located mainly in metro cities, in proximity to urban outskirts. Merchandise: They lend an ideal shopping experience with an amalgamation of product, service and entertainment, all under a common roof. Space occupied: Ranges from 60,000 sq ft to 7, 00,000 sq ft. Example: Pantaloon Retail’s Central, Mumbai’s Iorbit.
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In the above graph it shows that the in India the fastest growing retail segment is food and grocery because in India people spend more on eating. Then dressing because India is now turning to modern age and the people of modern age like to dress well and look well.
In the above graph it shows that the there are many formats of retailing in India but the specialty store and supermarket is fastest growing formats in India.
Key part of the general corporate strategy
A marketing strategy is most effective when it is an integral component of corporate strategy, defining how the organization will successfully engage customers, prospects, and competitors in the market arena. It is partially derived from broader corporate strategies, corporate missions, and corporate goals. As the customer constitutes the source of a company's
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revenue, marketing strategy is closely linked with sales. A key component of marketing strategy is often to keep marketing in line with a company's overarching mission statement.
1) Target Audience 2) Proposition/Key Element 3) Implementation
Pantaloon Retail Pantaloon Retail (India) Limited is India's leading retailer that operates multiple retail formats in both the value and lifestyle segment. Pantaloon has ushered a retail revolution in India and its founder Kishore Biyani is known as India's "King of Retail". Pantaloon's headquarter is in Mumbai. The company currently operates over 5 million square feet of retail space and has plans to increase it to 30 million sq. ft by 2011. Pantaloon has plans to open over 3000 new stores by 2010. Pantaloon's origin can be traced to 1987 when the company was incorporated as Manz Wear Private Limited. The company launched Pantaloons trouser, India's first formal trouser brand. In 1992, Pantaloon launched its IPO. In 1994, The Pantaloon Shoppe - exclusive menswear store in franchisee format was launched across the country. Pantaloon started distribution of distribution of branded garments through multi-brand retail outlets across the nation. In 2001, Big Bazaar, India's first hypermarket chain was launched. In 2002, Food Bazaar, the supermarket chain was launched. In 2006, Future Capital Holdings, the company's financial arm launched real estate funds, "Kshitij" and "Horizon"
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and private equity fund "In division". The company is also planning forays into insurance and consumer
Pantaloon Retail (India) Limited is India’s leading retailer with gross sales of Rs. 2,019 crores for the financial year ending June 2006. The company operates across multiple segments including –Food, Books & Music, Fashion, Telecom & IT, Home & Electronics, General Merchandise, Leisure & Entertainment, Wellness, Health & Beauty and E-tailing and that helps the company cater to every Indian customer. Some of the leading formats include, Pantaloons (department store), Central (seamless malls), Blue Sky (fashion accessories) and all (fashion apparel for plus-size individuals), Big Bazaar (hypermarket), Food Bazaar (supermarket), Fashion Station (popular fashion), Collection i (home furnishings), E-Zone (consumer electronics), Depot (books and music) and Shoe Factory (footwear). Company Name: Key People: Listed on: Stock Code: Fiscal Year Ending: Major Industry: Employees: Pantaloon Retail (India) Limited Kishore Biyani, MD & Group CEO Bombay Stock Exchange BOM: 523574 June Retailing and Dept. Store Chains 35,000 (June, 2008)
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Corporate Headquarters: Pantaloon Retail (India) Limited Knowledge House, Shyam Nagar Off Jogeshwari-Vikhroli Link Road Jogeshwari (East), Mumbai 400 060 Tel: +91 22-6644 2200 Fax: +91 22-6644 2222
Pantaloon Industries Ltd. Home Solutions Retail (India) Ltd. Future Capital Holdings Converge M Retail (India) Ltd. Indus League Clothing Ltd. Galaxy Entertainment Corporate Ltd.
Joint Ventures Companies
Planet Retail Holdings Ltd. Foot mart Retail GJ Future Fashions CapitaLand Retail India ETAM Future Fashions India Pvt. Ltd. Background: Founded in 1987 as a garment manufacturing company, the
company forayed into modern retail in August 1997 with the launch of its first department store, Pantaloons in Kolkata.
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Pantaloon Retail is a listed company on the Bombay Stock Scrip Code: 523574) and National Stock Exchange (NSE,
BOARD OF DIRECTORS
Mr. Kishore Biyani, Managing Director Kishore Biyani is the Managing Director of Pantaloon Retail (India) Limited and the Group Chief Executive Officer of Future Group. Mr. Gopikishan Biyani, Wholetime Director Gopikishan Biyani, is a commerce graduate and has more than twenty years of experience in the textile business. Mr. Rakesh Biyani, Wholetime Director Rakesh Biyani, is a commerce graduate and has been actively involved in category management; retail stores operations, IT and exports. He has been instrumental in the implementation of the various new retail formats. Mr. Ved Prakash Arya, Director Ved Prakash Arya, is an engineer by training and is a graduate of the Indian Institute of Management, Ahmedabad. Prior to joining Pantaloon Retail, he was the CEO of Globus.
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Mr. Shailesh Haribhakti, Independent Director Shri Shailesh Haribhakti, is a Chartered Accountant, Cost Accountant, and a Certified Internal Auditor. He is the Deputy Managing Partner of Haribhakti & Co., Chartered Accountants and past president of Indian merchant Chambers. He is on the Board of several Public Limited Companies, including Indian Petrochemicals Corporation Ltd., Ambuja Cement Eastern Ltd. etc. He is on the Board of Company since June 1, 1999. Mr. S Doreswamy, Independent Director S. Doreswamy, is a former Chairman and Managing Director of Central Bank of India and serves on the board of DSP Merrill Lynch Trustee Co and Ceat Limited Dr. D O Koshy, Independent Director D. O. Koshy, holds a doctorate from IIT, Delhi and is the Director of National Institute of Design (NID), Ahmedabad. He has over 24 years of rich experience in the textiles and garment industry and was instrumental in the setting up of NIFT centres in Delhi, Chennai and Bangalore. He is a renowned consultant specializing in international marketing and apparel retail management. Ms. Anju Poddar, Independent Director Anju Poddar, holds a Bachelor of Engineering from University of Oklahoma and is a Director, NIFT, Hyderabad chapter. She also serves on the board of Maharishi Commerce Ltd and Samay Books Ltd, Ms. Bala Deshpande, Independent Director
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Bala Deshpande, is Independent Director, Pantaloon Retail (India) Ltd. and also serves on the boards of Deccan Aviation, Nagarjuna Construction, Welspun India and Indus League Clothing Ltd, Mr. Anil Harish, Independent Director Anil Harish, is the partner of DM Harish & Co. Associates & Solicitors and an LLM from University of Miami. He also serves on the board of Mahindra Gesco, Unitech, IndusInd Bank and Hinduja TMT,
1987 Company incorporated as Manz Wear Private Limited. Launch of Pantaloons trouser, India’s first formal trouser brand. 1991 Launch of BARE, the Indian jeans brand. 1992 Initial public offer (IPO) was made in the month of May. 1994 The Pantaloon Shoppe – exclusive menswear store in franchisee format launched across the nation. The company starts the distribution of branded garments through multi-brand retail outlets across the nation. 1995 John Miller –Formal shirt brand launched. 1997 Pantaloons – India’s family store launched in Kolkata. 2001 Big Bazaar, ‘Is se sasta aur accha kahi nahin’ - India’s first hypermarket chain launched. 2002 Food Bazaar, the supermarket chain is launched. 2004 Central – ‘Shop, Eat, Celebrate in the Heart of Our City’ - India’s first seamless mall is launched in Bangalore. 2005 Fashion Station - the popular fashion chain is launched
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2006 Future Capital Holdings, the company’s financial arm launches real estate funds Kshitij and Horizon and private equity fund In division. Plans forays into insurance and consumer credit. Multiple retail formats including Collection i, Furniture Bazaar, Shoe Factory, EZone, Depot and futurebazaar.com are launched across the nation. Group enters into joint venture agreements with ETAM Group and Generali.
ABOUT THE COMPANY
Pantaloon Retail (India) Limited, is India’s leading retailer that operates multiple retail formats in both the value and lifestyle segment of the Indian consumer market. Headquartered in Mumbai (Bombay), the company operates over 10,000,000 square feet (930,000 m2) of retail space, has over 1,000 stores across 61 cities in India and employs over 30,000 people. The company’s leading formats include Pantaloons, a chain of fashion outlets, Big Bazaar, a uniquely Indian hypermarket chain, Food Bazaar, a supermarket chain, blends the look, touch and feel of Indian bazaars with aspects of modern retail like choice, convenience and quality and Central, a chain of seamless destination malls. Some of its other formats include, Depot, Shoe Factory, Brand Factory, Blue Sky, aLL, Top 10 and Star and Sitara. The company also operates an online portal, futurebazaar.com.
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A subsdiary company, Home Solutions Retail (India) Limited, operates Home Town, a large-format home solutions store, Collection i, selling home furniture products and E-Zone focussed on caterng to the consumer electronics segment. Pantaloon Retail was recently awarded the International Retailer of the Year 2007 by the US-based National Retail Federation (NRF) and the Emerging Market Retailer of the Year 2007 at the World Retail Congress held in Barcelona. Pantaloon Retail is the flagship company of Future Group, a business group catering to the entire Indian consumption space.
Future Group is one of the country’s leading business groups present in retail, asset management, consumer finance, insurance, retail media, retail spaces and logistics. Future Group is present in 61 cities and 65 rural locations. The group’s flagship company, Pantaloon Retail (India) Limited operates over 10,000,000 square feet (930,000 m2) of retail space, has over 1,000 stores and employs over 30,000 people. Some of its leading retail formats include Pantaloons, Big Bazaar, Central, Food Bazaar, Home Town, eZone, Depot, Future Money and online retail format www.futurebazaar.com. Future Group companies includes, Future Capital Holdings, Future Generali India, Indus League Clothing and Galaxy Entertainment which manages Sports Bar, Brew Bar and Bowling Co. Future Capital Holdings, the group’s financial arm, focuses on asset management and consumer credit. It manages assets worth over $1 billion that are being invested in developing retail real estate and consumer-related brands and hotels.
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The group’s joint venture partners include Italian insurance major Generali, French retailer ETAM group, US-based stationary products retailer Staples Inc and UK-based Lee Cooper and India-based Talwalkar’s, Blue Foods and Liberty Shoes. Future Group’s vision is to, “Deliver Everything, Everywhere, Everytime to Every Indian Consumer in the most profitable manner.” The group considers ‘Indian-ness’ as a core value and its corporate credo is - Rewrite rules, Retain values.
Lines of Business
The company is present across several lines of business which have various formats (stores) operational under it. These include:
Food - Food Bazaar, Chamosa, Spoon, Brew Bar, Sports Bar & Sports Bar Express, Cafe Bollywood, Fashion - Pantaloons, Central, aLL, Brand Factory, Blue Sky, Top 10, Fashion Station, Big Bazaar, Lee Cooper (JV), General Merchandise - Big Bazaar, Shoe Factory, Navras, Electronics Bazaar, Furniture Bazaar, KB'S FAIR PRICE Electronics - eZone, Home Improvement - Home Town Furniture - Collection i, Furniture Bazaar, Home Bazaar E-tailing (Online Shopping) - www.futurebazaar.com Books & Music - Depot Leisure & Entertainment - Bowling Co., F123
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• • • • • •
Wellness - Star & Sitara, Tulsi Telecom & IT - Gen M, M Bazaar, M-Port, ConvergeM
Pantaloon Retail is the flagship company of Future Group. The lines of business of Future Group are: E-commerce Pantaloon's website Futurebazaar.com has revolutionized the e-commerce business in India. It offers a wide range of products at affordable prices. It has been named as Best Indian Website 2007 in the Shopping category by PC World. Food In food business, the group offers a host of options. Food Bazaar - a chain of large supermarkets; Brew Bar - a beer bar; café Bollywood - a national chain of eateries; Chamosa - a pan-Indian chain of snack counters, and Sports Bar - a bistro focused on the world of sports.
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Fashion The group offers a variety of options in fashion. Its brands include aLL, Blue Sky, Central, Etam, Fashion Station, Gini & Jony, Navaras, Pantaloons, and Top 10. Home & Electronics Options include: Collection is - a lifestyle furniture store; Electronics Bazaar offers branded electronic goods and appliances; e-zone - trendiest electronics items; Furniture Bazaar - entire range of Home Furniture; Home Town - one stop destination for all the home needs.
Leisure & Entertainment Options are: Bowling Co. - state-of-the-art premium family entertainment centre, offering multiple, novel and unique leisure and entertainment options; F 123 - offers a wide range of gaming options ranging from bowling and pool to redemption and interactive video games to bumper cars.
Wellness & Beauty Options are: Health Village - a state-of-the art spa and yoga centre; Star & Sitara: Beauty salon for men and women; Tulsi - provides access to the best allopathic, ayurvedic and homeopathic medicinal products; Turmeric - offers beauty products like color cosmetics, fragrances, herbal and specialty skin items, hair products and bath accessories.
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Books & Music Future Group's brand - "Depot" offers Books, CDs, and stationery items.
MAJOR INDIAN RETAILERS
The low-intensity entry of the diversified Mahindra Group into retail is unique because it plans to focus on lifestyle products. The Mahindra group is the fourth large Indian business group to enter the business of retail after Reliance Industries Ltd, the Aditya Birla Group, and Bharti Enterprises Ltd. The other three groups are focusing either on perishables and groceries, or a range of products, or both. RPG Retail-Formats: Music World, Books & Beyond, Spencer’s Hyper, Spencer’s Super, Daily & Fresh Pantaloon Retail-Formats: Big Bazaar, Food Bazaar, Pantaloons, Central, Fashion Station, Brand Factory, Depot, aLL, E-Zone etc. The Tata Group-Formats: Westside, Star India Bazaar, Steel junction, Landmark, and Titan Industries with World of Titans showrooms, Tanishq outlets, Chroma. K Raheja Corp Group-Formats: Shoppers’ Stop, Crossword, Hyper City, In orbit Lifestyle International-Lifestyle, Home Centre, Max, Fun City and International Franchise brand stores.
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Pyramid Retail-Formats: Pyramid Megastore, TruMart Nilgiri’s-Formats: Nilgiri's’ supermarket chain Subhiksha-Formats: Subhiksha supermarket pharmacy and telecom discount chain. Trinethra- Formats: Fabmall supermarket chain and Fabcity hypermarket chain Vishal Retail Group-Formats: Vishal Mega Mart BPCL-Formats: In & Out Reliance Retail-Formats: Reliance Fresh Reliance ADAG Retail-Format: Reliance World German Metro Cash & Carry Shoprite Holdings-Formats: Shoprite Hyper
Market strategy is defined as an action plan for influencing customer choices and obtaining a market share. Market strategy should entice customers to buy the product or service. Market strategy encompasses customer perception of the relationship between price and quality. Is the quality of the product or service worth the price? Is the price too low for the quality the customer desires? Is the price higher than the customer's perception of quality? Market research identifies the price and quality relationship customers perceive to be important. Remember, customer perception is the bottom line. Market strategy also includes the distribution channels for the product, pricing and terms of sale, promotion and advertising plan, marketing budgets, inventory selection and management, visual merchandising, customer relations and an evaluation of the marketing strategy. The marketing plan provides information on what the market will be (retail, wholesale) and what specific customer groups will be targeted, what will be sold, where it will be sold, and how wide the area of distribution will be.
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Ideally, market segments with a potential for high sales, profits, growth and a minimum of competition are the most attractive. A marketing strategy is a process that can allow an organization to concentrate its limited resources on the greatest opportunities to increase sales and achieve a sustainable competitive advantage. A marketing strategy should be centre around the key concept that customer satisfaction is the main goal.
Following strategies adopted by the organization.
1. A strong quality of the product and customer satisfaction: Customers always believe in good quality product. In my survey I found that in percentage term more people is quality conscious and not price conscious. Customer satisfaction is very important part of the organization that at any cost they have to fulfill. 2. A growing relationship with customer and customer retention: Nowadays a good relation with customer is very important for organization. Sale is totally depending on the relation with the customers. Customer's retention is also a major aspect for growing business. It means keep the old customer and try to make new customer. 3. Focus on competitor’s activity: Every organization should must be careful about it's competitors step, because they can disturb the growing sales process of the organization. 4. A growing emphasis on global thinking and local marketing planning: Companies are increasing by pursuing market beyond their borders. When they enter other countries they must follow the tradition of that country and also they make plan for local market that which type of product has more demand and how can it run in the market. 5. Promotional Strategy: Under the market strategy promotional idea is very important. Organization provides some schemes or rebates to retailers or consumers. They make advertisement according to convenient of the people and the feature of the product. So on the basis of marketing strategy a organization runs in the market. It is several types of which makes helpful to increase sales and turnover of the organization.
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6. Growth through private labels: A striking characteristic of Pantaloons has been the
strength of its private label programme. In Pantaloons 70% of apparel sales come from own labels. John Miller, Ajile. Scottsville, Lombard, Annabelle, Honey, Bare are some of the successful brands created by the company.
MARKETING MIX STRATEGY PRODUCT
Quality Design Features Brand name Services Warranty
PRICE List price Discount Allowances Payment period Credit term
PROMOTION Advertising Public relation Sales forces Direct marketing
PLACE Channel Coverage Location Assortment Inventory Transport
Unique Customer Perception (UCP)
Marketing is a domain which is dynamic i.e. involves change, an important phenomenon not to be overlooked. We have come across a term “Unique Selling Proposition”(USP) which companies feel as a constant factor . Every organization is an open system of management which means change is inevitable and is associated with environmental factors. Companies need to focus not only on USP of their products but also on the “Unique Customer Perception” (UCP) of the final end users.
The prop of marketing is based on the need identification and the USP's are prepared based on the identified needs. If the needs are wrongly identified then even the USP's which are
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unique to the product would not serve the purpose. USP identifies a product/service from its competitors while UCP is the perception or picture a customer develops from all types of promotional inputs from the company about their product or service. It is often seen that some brands do extremely well compared to other brands having the same resources. The reason for the brands not to do well is probably the communications which does not reflect the customer’s perception. So it is not the USP but UCP that plays an important role .This has lead to the concept - “Customer Perception is the Rule and not Customer Satisfaction”. Remember that a customer always buys a product or service with a lot of expectations which he has derived from the promotional inputs of the company or other sources including wordof- mouth. So a customer would be satisfied when Performance is equal to Expectation while would not be satisfied when Performance does not match with Expectations. Now this expectation is what has been derived from perception. Perception is not good or bad, right or wrong, it is just the way someone judges an experience based on their value system of what they believe should happen. Since people are unique, each of their perceptions are unique .On the other hand each situation is a "point of contact" with an employee that will tell the customer a "truth" about the company's idea of customer service. Each situation will create expectations’ of what the next experience will probably be like. Companies spend considerable amount on advertisement and in this world of competitive advantage advertisement has to be repetitive in nature. Brand hammering results in brand recall which is a costly affair. So companies need to understand the Unique Customer Perception to facilitate advertising and Sales Promotional (ASP) efforts towards a better bargain. The cost incurred on advertisement is huge i.e. if we refer to the 5 M's of advertising, Money is a budgetary constrain for an ideal advertising campaign. Thus UCP has to be rightly analyzed for better results by the company to match performance and expectation.
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REVIEW OF LITERATURE
PJ GERMAIN The customer's perception: Customer perception is an important component of our relationship with our customers. Given that 90% plus of our orders at some point involve the phone, how we handle the telephone is essential to creating a perception for our customer that aligns with the company mission of service. Smiling stretches your vocal cords, and gives a more upbeat presentation to the customer. Slowing down ensures that the customers perception is of an organized systematic company that can handle their project. Getting it done right and on time consistently. Article source: http://www.fibre2fashion.com BY SOUMEN CHATTERJEE Unique customer perception (UCP): According to soumen, Unique Customer Perception is what is required by companies instead of Unique Selling Proposition. It is ultimately that customer look for satisfaction based on the picture of perception derived from various sources. If these perceptions of customer can be analyzed then promotion would be easier for customer centric marketing. This has lead to the concept - “Customer Perception is the Rule and not Customer Satisfaction”.
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Article Source: http://EzineArticles.com/?expert=Soumen_Chatterjee BY JEN B Brand recognition will change customer perception: According to JenB, for a bigger stronger business you have to get some serious brand recognition happening. People need to know your name before any thing else. You want people to thing of you a certain way too. This is the ticket to getting the image that you want. If you get a lot of blank looks from people that are not current customers then you probably have no recognition at all. That means it is time for an advertising switch. Even if people don’t buy the product they will recognized the name. Remembering a business is one step closer to trusting a business. Brand recognition is accomplished only by people seeing your logo and business name over and over again. This will create the repetition that your customers and future customers need to pick your product out of a crowd time and time again. Article Source: http://www.a1articles.com/article_1035917_15.html
HUAWEI Satisfy customers perception is the biggest challenge: In meeting customers' requirements and measuring customers' satisfaction indexes, customer perception should be definitely a key consideration. Qualified services in the operation execution layer, technical management layer and business development layer are necessary. It is more important to understand customer expectations and make efforts to exceed their expectations. In customer satisfaction management, the biggest challenge is customer perception management, or customer perception satisfaction. The major characteristics of service is intangible, hence the core value of services is not like a physical product but the spiritual experience and perception of customers. The final aim and ideal effect of service provisioning is to have customers perceive and enjoy the service. Such perception is both at psychological and behavior levels, and it is the contents of high quality life in the modern society. Customers are seeking for material deliverables as well as perceptive enjoyment when purchasing a service product. Since perceptive enjoyment is a vital service objective, one of the key service management objectives shall be meeting customers' perceptive enjoyment. Article source: Huawei Technologies Co., Ltd
MORGAN STANLEY Quick Comment – Impact on our views: We met Rakesh Biyani, Director Future Group, who heads the retail business. Our investment thesis regarding improving business outlook and availability of capital to fund growth plans continues to hold good. Management has consciously shifted focus to growth quality rather than just growth. We reiterate our Overweight rating and believe that any volatility in the stock price should be viewed as an
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entry opportunity. Here are the key takeaways from the meeting: Aggressive growth and margin targets: PRIL has set an aggressive 16-17% same store growth (SSG) target for F2010. This compares with F2009 SSG of 7.0%. The company plans to achieve this target by adopting active merchandise management. First, the company is likely to ensure that its fastest-selling products don’t go out of stock. It has increased its order per SKU range from 900-1,400 to 600-6,000 to ensure reduced stockouts for fast-selling products. Second, it has put in place a system to continuously monitor underperforming categories/segments/SKUs so that they can be immediately replaced. Third, it has improved product quality and pricing across its merchandise (particularly private label) to ensure market share gains. Fourth, it has now set store-wise, product-wise and SKU-wise, daily/weekly sales targets so that the monitoring and feedback system improves significantly. Focus on efficiency to improve margins: The management is targeting 200-250 bps improvement in gross profit margin, a 30% reduction in logistic costs, and a reduction in nonstore inventory during F2010. Gross margin improvement is likely to be driven by improvement in sell-through ratio (% of products sold through the primary store), from 79% in F2009 to 89% in F2010. The company achieved 79% in F2009, which was an improvement from 64% in F2008. Significant improvement in private label contribution, particularly in the apparel segment, may also help the overall mix improvement. TRENT LEYSHAN Creating the right ‘Value Perception’ for your Customers: According to Trent Leyshan Value Perception (VP) is the opinion your potential and current customers have of your product or service. This perception determines the value it adds to them in line with the problems it needs to solve or aspirations they want it to fulfill. Irrespective of your customer’s opinion being right of wrong in your mind, their opinion matters none the less, in fact, critically so. Some may suggest; “But the customer my have it wrong” In this instance we respond: whose fault is that: the customer, sales person, sales manager, marketing dept or Company Directors? One this is for sure, it certainly isn’t the customers fault. Value cascades down the value deliver system into the customer. A breakdown on any level can be detrimental to a company’s success. The customer’s positive perception, along with an effective sales process will help the customer make the appropriate buying decision. Article source: www.trentleyshan.com |
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Pantaloon Retail is investing in new business lines, which would catalyze consumption within the company's retail stores. In line with this strategy, the company has invested in different new businesses such as capital, consumer finance, brands, and media, through joint ventures with various companies across the world. Pantaloon is planning to strengthen its business in India through openings new stores in all retail formats, technology up gradation to maintain a cost effective inventory management and better customer service. Pantaloon operates in three segments of the retail value chain: wholesale (procurement of stocks), operations and distribution (warehousing and transportation) and sales (physical store operations, online sales and other channels). The company does not have a presence in two other sections of the retail value chain: raw materials and manufacturing. Pantaloon has entered several joint ventures to add new and branded products in its portfolio. The company offers office products through a joint venture with Staples, and telecom
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equipments through an alliance with Axiom Telecom. Such alliances would help it attain international appeal and enhance the customer shopping experience The company is planning to launch more several brands across categories in the near future including kid's wear, innerwear, sportswear and possibly home textiles. Pantaloon's production facilities are concentrated on trousers, shirts and jeans.
The company has stores in nearly 30 cities across the country, constituting over 2.7 million square feet of retail space. The company has also signed close to 10 million sq. ft. of retail space to be operational by end 2008, which represents 20-30 % of all modern retail space coming up in the next three years. Over 200 million footfalls are expected in our stores by 2006-07.
1) The graph given below shows that the most of the people like to buy
their product at the beginning of the month and they like to buy their products once in a month.
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2) From the survey I found that the more people like to buy their
product from pantaloon retail because they know the brand very well.
3) In the present scenario the customers likes to spend money because it
shows the living status in the society.
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4) From the graph given below it shows that the 62% of the people
think that the location of the store is perfect because it’s in the main market area and any one can come easily.
5) Assortment of the product is very important so that customer can get their product easily.
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6) People think that the quality of the product is good.
After sale service 12.5%
7) This is one of the best strategy adopted by the pantaloon that they provide free home delivery if a customer purchase over Rs 500.
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8) CUSTOMERS SATISFACTION TABLE
No. customers Very Satisfied 40 10
Very Dissatisfied 0
Analysis: - In my research I analyze the more no. of customers are satisfied and some customers are very satisfied and less no. of customers are dissatisfied.
0% 13% 25% VERY SATISFIED SATISFIED VERY DISSATISFIED DISSATISFIED 62%
P ALOONCUS ANT TOMERSS TIS ACTION A F
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9) In customer perception Pantaloon Company used by the marketing strategy is Good for the customers or Not
No. of Customers 40
During the period of research I analyze the maximum customers are
think Pantaloon Company used by the marketing strategy is good for the customers and very less customers are think it is not good.
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10) Promotional strategy used by the pantaloon this is also a strategy
used by the company to make a brand they use all the tools of advertising like news papers, radio, internet, television and banners. That’s why people know them very well and they have a positive perception about the pantaloon retail India limited.
News paper 30%
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I am find out the which strategies used by the company. As well as customer satisfaction level. I was met forty customers of Pantaloon Company. And ask the some questions and find out the customer perception as well as satisfaction level. In my serve I am find out the more than 50% customers satisfied to the pantaloon services. In customers perception companies marketing strategy is very good and helpful to the company and the customers.
The company’s goods & services, quality product, price, after sale services, assortment of the product, etc. all part is suitable for the customers that’s why customers are buying the goods.
Location of the store is convenient of the customers. They are thinking for the customers it means what are the needs of the customers, what they want, etc. As per customers wants they are providing goods and services to the customers.
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I conclude that the Pantaloon Company is the big company. And its marketing strategy is very effective. They know very well how to attract the customers. As per they are using the strategy many customers give preference to the Pantaloon Company. And they also have a good brand name their promotion strategy is good they know how to retain a customer and how to make a loyal customer and they believe to make a loyal customer because they know one loyal customer can make many customer. They also maintain a clean floors and nice staff who always ready to help you because a good behavior is also a reason for increase in sales. If they not behave properly with the customer so that can be a big loss for the company. They also maintain a good relationship with their customer they don’t want to disappoint any customer that is why they provide a good service to customer. The Pantaloon Company is providing to the good services, after sales service, quality product, reasonable price, etc. that’s why pantaloon customers satisfied level is high.
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1. How often do you buy your product? a. Once a week b. Once a month c. Once in a three month d. Once in a six month e. Once in a year
2. From where do you buy your product?
a. b. c. d. e.
Pantaloon Vishal mega mart Reliance Spencer’s More
3. How much do you normally spent in a single shopping? a. Less than 500 b. Between 500 to 1000 c. Between 1000 to 2000 d. Between 2000 to 5000 e. More than 5000
4. What do you think this is the perfect location of the store?
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5. Assortment of the product in store is suitable for you? a. Yes b. No
6. On which basis you have purchase the goods? a. Price b. Quality c. Services d. After sales services .
7. According to you free home delivery providing to the shop is one
of the reason of increase the sales?
8. Are you satisfied with the services of the store? a. Very satisfied b. Satisfied c. Very dissatisfied d. Dissatisfied
9. What do you feel he marketing strategy adopted by the company is good for customer or bad?
a. Yes good
b. No bad
10. How do you come to know about this location of store?
a. News paper b. Radio c. Television
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NAME OF THE PANTALOON CUSTOMERS
1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24. 25. 26. 27. 28. 29. 30.
K. Ram Kishan K.Suresh M. pand Rangachary Dr sermista chandraShekar Waghmare P. Anuradha Vishwanathan V. S. Sharma Uma Maheswar Rao Bhavani Y. Sai Shrikant Shiv Parvati Madhusudan Narsing Rao Pravin Kumar Kishan Srikrishna Srinivas G. Yadatah D.R. Sarloe R. Uarilal Ravindarnath Pravin Kumar Shekhar Kiran K Srinivas Rao K Sevarth Papa Rao Rasamal Rao Nageswar Rao
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31. 32. 33. 34. 35. 36. 37. 38. 39. 40.
M.S.Devikar Alim Ranga swami B.S.Yousuf sharief D.Nagabhushan K.Ehcari Ranga Reddy Jaganmohan Rao Venkat Narsaya Madhukar Raj
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Www.pantaloon.com www.datamonitar.com www.fibre2fashion.com www.rediff.com www.scribd.com
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