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CRM in Apparel Retail Sector
SUBMITTED BY: Enrollment No. : A0102107042 MBA (E&L) Class of 2009
Under the guidance of Professor , HOD Economics Department.
Mr. Jitender Kumar
In Partial Fulfillment of Award of Master’s Degree In Business Administration
AMITY BUSINESS SCHOOL
AMITY UNIVERSITY UTTAR PRADESH
AMITY UNIVERSITY UTTAR PRADESH
AMITY BUSINESS SCHOOL
I, KAPIL BHATI student of Masters of Business Administration from Amity Business School, Amity University Uttar Pradesh hereby declare that I have completed Dissertation on “CRM IN APPAREL RETAIL SECTOR” as part of the course requirement. I further declare that the information presented in this project is true and original to the best of my knowledge.
Date: Place: Noida
Name: Kapil Bhati Enroll No: A0102107042 Program: MBA (E&L)
AMITY UNIVERSITY UTTAR PRADESH
AMITY BUSINESS SCHOOL
I, ………………………………..hereby certify that Kapil Bhati, student of Masters of Business Administration at Amity Business School, Amity University Uttar Pradesh has completed dissertation on “CRM in Apparel Retail Sector ”, under my guidance.
Mr. Jitender Kumar Professor , HOD Economics Deptt.
“No Project is ever a work of only one person and this one is no exception”
This project is the product of many hands, and countless hours from many people. My thanks go out to all those who helped, whether through their comments, feedback or suggestions. It gives me immense pleasure to express my deep sense of gratitude to Ms. Varsha Khattri (Faculty guide) for her valuable guidance, constant supervision and above all her continuous encouragement & support during the tenure of this project. I am deeply indebted to all the Store Managers of different Lifestyle Stores, for providing me with best information and shared their vast knowledge and technical expertise for completing this project. Sincere thanks to all the people who have worked under this project. Lastly, no words could adequately convey my heartfelt thanks to the family members and friends who indirectly co-operated with us.
Kapil Bhati A0102107042 MBA (E&L)
1 Pantaloon Retail (India) Limited 2.2 Drivers for retail transformation in India 1.5 Lifestyle International (Pvt) Limited . Industry Insight – Indian Retail Industry 1.2 Evolution of Retail 1.2.1. 1 Introduction 1.1.5 Marketing segmentation of retail industry 2.1 New Retail Entrepreneurs 2.No.3 From Franchise to Company Owned 2.3 Challenges for organized retail 1.4 Some Facts 1. Chapter Name Page No.3 Major Players 2.1 Introduction 1.3 Some Facts about Indian Apparel Industry 2.3 Retailing Formats in India 1.3.1 Growth in organized retail 1.3.3 Shopper’s Stop Limited 2.1.1 Overview 2.2 Globus 2.3.2. Apparel Retail in India 2.CONTENTS Declaration Certificate from Faculty guide Certificate from Industry Guide Acknowledgement S.3.2 Characteristics of Apparel retail sector 2.4 Trent Limited 2.3.2 Changing Consumer Behavior 2.2.
3 Customer Retention Profile 3.2. Customer Relationship Management 3.6 comparison between different players 2.5 Future Outlook 2.3.4 CRM & IT 2 3 4 5 6 References Annexure Literature Review Problem Statement Methodology Results & Discussions Suggestions & Conclusion .6 Retail Touch points 3.4 Managerial Challenges 2.1 Introduction 3.2 Dimensions of CRM 3.
With changing demographic and economic profile of the Indian population. hypermarkets. Along the way. to McKinsey. .Industry Insight – Indian Retail Industry: The retail sector in India is witnessing a huge revamping exercise as traditional markets make way for new formats such as departmental stores. Modern retailers will not only create employment opportunities but also would help raise India’s overall economic productivity and could also result in lowering prices of goods. At present India’s modern retail business accounts for only about 5% of the country’s annual retail business. it is believed that India is expected to experience accelerated consumption over the next few years. the country’s overall retail sector will become a $450 billion (Rs20. With an expanding economy. supermarkets and specialty stores. Food and beverages. it is also believed that increase in consumer spending would be driven by nuclearisation of families. the modern retail business will create about 1. The Indian Retail Sector The Indian Retail Sector is at an inflexion point. Further. Western-style malls have begun appearing in metros and second-rung cities alike introducing the Indian consumer to a shopping experience like never before. with changing demographics driving growth of organized retailing and driving growth in consumption. Not only are the demographic factors becoming more favorable but also the growing media penetration is leading to a convergence of aspirations of various classes of consumers. apparel and consumer durables are the top three categories of consumer spend and form 87% of the total retail sales in India.85 trillion) business by 2015. increasing population of working women and new job opportunities in emerging service sectors such as IT Enabled Services.6 million jobs in the next five years acc. With declining interest rates an average Indian is not averse to taking loans.
org/artdisplay. Organized retail derives its advantages in generating operational efficiencies while simultaneously catering to rising consumer aspirations. In the past. negative yield spread on leased property and lack of bank funding due to unorganized property market resulted in a dearth of quality retail space in the country. The inability of the unorganized sector to offer a wide range of products along with artificially inflated costs due to various factors have presented opportunities for growth in the organized retail sector migration from unorganized to organized retail has been visible with economic development in most economies. Availability of quality retail space has been one of the main constraints for development of organized formats in India. greater selection. However. most of these retail outlets belong to the unorganized sector. improved service and in store ambience. Drivers for retail transformation in India A number of factors that drive transformation in retail – such as income growth. and lowers logistics and marketing costs while delivering better value to customers in terms of lower price. With close to 12 million retail outlets India has the largest retail density in the world.aspx?tdy=1&cat_id=60&art_id=20386 Growth in organized retail In sharp contrast to the global retail sector. better quality. The Indian retail industry is evolving in line with changing customer aspirations across product groups. changing demographic profiles and socio-economic environment – are already in place in India. Size drives economies on procurement. organized retail has to overcome significant challenges in terms of regulations and infrastructural barriers in order to realize its full potential. The spread between yield on property and its financing cost has turned positive with the .ibef. with modern formats of retailing emerging. However. retailing in India – though large in terms of size – is highly fragmented and unorganized.Source: 1) www.
The retail sector has not been granted industry status. FDI restrictions have also restricted entry of international majors in retailing in India. Most of the world’s leading brands are now present in India.This adds to cost and complexity of distribution as this necessitates multiple warehouses and does not allow for centralization of certain 16 procurements given the incidence of local levies. there is large-scale sales tax evasion by smaller stores who derive significant cost advantage through such evasion. Similarly. which could have Otherwise helped the industry develop with funding as well as bringing in of best practices and systems. At the same time. Attractive yields on investments have resulted in sharp increase in property development. Consumerism and brand proliferation has been another enabler for organized retailing in India.html Challenges for organized retail There exist differential sales tax rates across states in India . the ability of the retail business to hire and retain quality people is under pressure. The availability of trained manpower poses a key risk for the retail sector.fall in interest rates. both vendor management and logistics management are still undeveloped. The capital requirements for a retailer are in real estate (which banks have historically restricted lending to) and for working capital requirements. With growing opportunities in the emerging service sectors such as ITES. equity options are also restricted with Foreign Direct Investment not being permitted in the retail sector. Value Retailing . with growing size of operations. the smaller ones are constrained for growth funding. While some of the leading retailers are still able to get bank funding. However. In India. supply chain efficiencies will become a key differentiator of profitability in retail. Supply chain management efficiencies are essential to retailers to maintain and improve margins.indianmba. Source: www.com/Faculty_Column/FC460/fc460. limiting funding from banks and financial institutions.
These stores primarily retail primarily food and house hold items. The share of expenditure on food and grocery in a consumer’s wallet. though some of them focus on their in house store label (on the lines of Marks & Spencer’s and St. Food world) has presence in metros and mini metros. availability of a vide variety of products at a reasonable price are the main factors which has contributed to the growth of this segment. These are primarily large stores with volume based discounted prices. Lifestyle retailing These stores retail primarily non-food items such as apparel. Star India. footwear. They stock multiple brands across product categories. Michael). The larger chain of supermarkets and hypermarkets (namely Big Bazaar. Nilgiris. The convenience factor coupled with the inspirational perception of shopping in a department store has contributed to their growth. These stores are found on high streets and as Anchor Tenants of shopping malls. Westside. Evolution of Retail . accessories. Several local department store chains have opened shop in India in the past five years. cosmetics and household products. The larger chains of department stores (Namely Pantaloons’. Shoppers’ Stop. and Lifestyle) have presence in the metros and mini metros.
Source: 1) www.ey.com/india India’s five main consumer segments: .
scribd. www.Source: 1. . service and entertainment. the Mumbai books retailer Crossword. Specialty Stores: Chains such as the Bangalore based Kids Kemp. Examples include Shoppers Stop. Ranges from 60. Located mainly in metro cities. in proximity to urban outskirts. Pyramid. all under a common roof.000 sq ft and above.000 sq ft to 7. They lend an ideal shopping experience with an amalgamation of product. and Pantaloon. 2. are focusing on specific market segments and have established themselves strongly in their sectors. 00.com/doc/47945/McKinsey-MGI-india-consumer-full-report/ Central Statistical Organization(CSO) & Technopak Analysis Retailing Formats in India: Malls: The largest form of organized retailing today. RPG's Music World and the Times Group's music chain Planet M.
the biggest success is K Raheja's Shoppers Stop.scribd.000 sq. feet located near residential areas. seven days a week. Super Markets can further be classified in to mini supermarkets typically 1. These are located in or near residential high streets. Among these.500 sq ft to 5.Discount Stores: As the name suggests. Prices are slightly higher due to the convenience premium. The product category can range from a variety of perishable/ non perishable goods Department Stores: Departmental Stores are expected to take over the apparel business from exclusive brand showrooms. . which started in Mumbai and now has more than seven large stores (over 30. These stores today contribute to 30% of all food & grocery organized retail sales.000 sq ft. Hyper marts/Supermarkets: Large self service outlets. These usually do well in busy market places and Metros. also known as Category Killers.com/doc/4782190/The-Indian-Retail-Snapshot Convenience Stores: These are relatively small stores 400-2.000 sq ft to 2. They stock a limited range of high-turnover convenience products and are usually open for extended periods during the day. Source: 1) http://www. MBO’s: Multi Brand outlets. catering to varied shopper needs are termed as Supermarkets. offer discounts on the MRP through selling in bulk reaching economies of scale or excess stock left over at the season.000 sq. discount stores or factory outlets. ft) across India and even has its own in store brand for clothes called Stop!. having a strong focus on food & grocery and personal sales. offer several brands across a single product category.000 sq ft and large supermarkets ranging from of 3.
fashion in India is becoming more stratified.Some Facts: • • • • • • • • Global Retail industry is of size USD 8 Trillion Over 50 of the Fortune 500 companies are retailers 25 of the Asian Top 200 companies. Top-notch fashion professionals came together four years ago to form the Fashion Design Council of India. As lifestyles change.110. Technology. and quickly. ideas and lifestyles are moving concurrently. fashion has also played an important role in shaping apparel consumerism. Companies and brands that offered monotonous. are retailers Fortune #1 “Wal-Mart” is a Retailer Over 12 Million Outlets in India Organized Retail < 3% Set to grow to 8-10% by 2010 Organized Retail expected to be around Rs. Under the aegis of the Union textile ministry and in tandem with . mundane products for years have now tripled their product ranges and new appealing shapes and forms are being launched each Season.scribd.000 Cr(USD 25 b) by 2010 Share of all the segments in retail: Source: 1) http://www. as in the West.com/doc/4782190/The-Indian-Retail-Snapshot APPAREL RETAIL: Moving Beyond Customer Expectations The influence of fashion clearly.
But now. Today many leading fashion labels are being associated with Indian products. Now. The 1996 Indian textile exports approximately amounted to Rs. just like their Indian counterparts. and forward linkages with the retail and distribution network. given its large population and growing household incomes. Source: 1) http://apparel.indiamart. Yet it has now set up its own stand-alone stores. with the government’s proposal to let in branded retail players— brands like Benetton and Lacoste currently sell mostly through the franchise route—investments in India’s apparel sector are likely to go up substantially.000 crores of which apparel occupied over Rs14. . nevertheless. tells only part of the story. A few significant foreign players—such as Levi Strauss. Indian Apparel Industry. India is increasingly being looked upon as a major supplier of high quality fashion apparels and Indian apparels have come to be appreciated in major markets internationally. The boom in domestic apparel. global apparel brands are setting up their own apparel outlets. instead of just selling through departmental stores.000 readymade garment manufacturing units and around three million people are working in the industry.35. enthusiasm in the minds of the foreign buyers is also at a high. has a limited range exhibited in generic department stores located in metro cities.an Overview: The apparel industry is one of India's largest foreign exchange earners. for example. which showcase all the company’s brands. India has huge potential as a market for foreign clothing.html It has been estimated that India has approximately 30. Ralph Lauren.National Institute of Fashion Technology.000 crores. accounting for nearly 16% of the country's total exports. FDCI now provides professional inputs for designing labels and is now working towards developing the fashion supply chain through backward linkages with suppliers and mills.com/lib/garments/indian07251998. Today not only is the garment export business growing. Benetton and Lacoste—have been selling their branded apparel in India for a number of years. The credit for this goes to our exporter community.
The industry will be soon faced with open competition shorn of quotas or tariffs. Latin America and Australia is also mandatory for export growth. improving technical capabilities and putting together an attractive and wide merchandise line has paid rich dividends. Central Africa. there is no reason for complacency on the part of Indian exporters or of the garment industry. India is a film-crazy nation.000 every year. footwear. with more than 1.Consistent efforts towards extensive market coverage. apparel retailers. Upper income urban women are adopting ethnic chic. affluent urban Indian women are shopping like never before. Though these are expected to fizzle out soon. and set the popular fashion trend. In the large urban centres. Bollywood fashions have become pan Indian.ibef.org They spend mornings browsing in stores looking for deals or latest styles. These are designer clothes that incorporate Indian motifs. and the largest producer of films. But till today. our clothing industry is dominated by sub-contractors and consists mainly of small units of 50 to 60 machines. With growing working women wearing western wear to work. It is the largest Sector. Source: 1) www. East European countries. weddings and fashion accessories. like Shoppers Stop. clothing retail accounts for 36% of organized retail business. They provide entertainment and an escape from reality for India’s masses. India's supply base is medium quality. Westside and Pantaloon . Ready-made apparel accounted for an estimated 20% of domestic clothing sales in 2005. but small volume business. They affect various sectors of the market including clothing. relatively high fashion. market for good readymade clothes is likely to grow. Inculcation of a spirit of innovation by way of research and development and tapping new markets especially in South Africa. In India. ethnic fabrics and are a fusion of western and Indian styles. CIS. With the advent of modern format retailers and the growth of plastic cards. Thus the need of the hour is to enlarge both manufacturing as well as the marketing base. and pressed for time. Recent recession in Europe and the South Asian currency crisis have also contributed their own bits to the decimating Indian exports.
while Pantaloons offers a `Green Card' Rewards programmes. retailer ensures that there is no repetition of same. Customers look to design and fit of the clothes. colour. Customers have loyalty to a store rather than any particular garment brand. Westside carries only its own private labels. This has led to a thriving unbranded or local brand market for ready-to-wear clothes leading to severe competition. a player needs to keep a close watch on fashion amongst teenagers as they are the trend setters. Category management becomes very crucial function as transformation of design into production and delivery has to be completed before fashion or fad changes in the market. Apparel retailer needs to understand critical role of sales promotions. stock piling and brand switching on the part of a consumer which substantially reduces retailer’s financial and inventory risk and . Importance of store layout. 20-30% of their apparel turnover is from private labels. It gets replaced by different design. Seasonal variations on stocking pattern and need to clear inventory at the end of season should be understood by apparel retailer. Typically once an item is sold from the outlet. Indian textile and clothing industry during 2006 is estimated to be about INR1. Hence organized retailers like Lifestyle. style. while for the other stores. and use the shop’s name as a quality standard. for instance. décor is very critical. A browser visiting the store frequently likes to see changes in the layout otherwise he may carry the impression that stocks are not moving out of the store. women and kids . which have attracted urban shoppers. Characteristics of Apparel retail sector As apparel retail is led by fashion. Role of Bollywood in spreading fashion needs to be understood. Attractive promotions induces purchase acceleration. goes down substantially and inventory carrying burden turns out to be very high. This highlights the importance of sales promotions. has a loyalty programme called `The Inner Circle'.short term activities which induces trade or consumer to buy now rather than in future as the value of apparel after the season.511 billion ( USD 38 billion) .have popularized their private labels. which includes apparel of men. Westside has `Club West' to Woo the customers.
then company has doubled its presence to 14 stores in 2006. company should have best CRM strategies.consumer’s financial risk and psychological risk. Source: 1) www. the company is expanding to other north Indian states. and that’s a bit of a surprise in a country where preferences change every 25 km and loyalties change for a 10% difference in pricing.earlier owns seven stores located across various metro cities. the New Retail Entrepreneurs Delhi-based Ebony has commenced a massive expansion in northern India with eight new stores and a combined retail space of 150.ernet. its brands and promote new brands. growing numbers of nuclear families in urban . Branded apparel merchandising is gathering critical momentum in India. occupying a combined retail space of one million square feet. Mumbai-based lifestyle chain Pantaloon spends around US $ 840000 in a year to revitalize Shoppers Stop –has more than 35 more Outlets. Lifestyle. If the customer will purchase first then only he/she can be loyal so in order to retail the existing & attracting the new ones.iimahd. brands have started shaping buying behavior.in/publications/data/2007-07-01Preeta. Enter.000 square feet.pdf Changing Consumer Behavior But suddenly. Spykar has set up approx 35 stores across the country in all the major cities. A large young working population with a median age of 24 years. a part of the Dubai-based Landmark Group retail chain. Besides sprucing up exiting stores in Delhi and Punjab. Bangalore-based TCNS Clothing has more than 37 stores across the country.
Industry experts believe that apparel sales in retail stores posted a growth of between 2530 per cent in 2003 and according to an estimate by McKinsey.000 sq ft stores to sell its flagship brand apparel: Arrow. the consumer boom is being driven by a new openness about using credit cards. after food products.areas. the store is designed to function at three levels—ground. apparel buying is the second biggest consumption category at malls. Now. semi-ground and . Apparel retailing is no longer a metropolitan phenomenon. According to ICICI Bank. Madura Garments and Zodiac Clothing building extensive retail networks. Arvind Mills. Because the market potential was still relatively small in the nineties. Now. Raymond’s – the flagship brand of the Singhania Group-. From Franchise to Company Owned Larger textile manufacturers were the first off the block in the nineties. the company management has closed down a number of these small stores and gone in for bigger stores. Until recently. Madura Garments has opened up a mega store in the heart of Bangalore that sells the company’s flagship brand. the Arvind Mafatlal Group had a chain of below-1.is revamping its chain of 300 stores—known as Raymond’s Shops—and focusing on readymades at a cost of around US $ 35 million. Previously. The logic: the contribution of readymade apparel to total sales has gone up 25-30 percent compared to the previous year. Over the last two years. Without question. across metros. and nearly per cent of Arvind’s apparel business comes from these outlets. with big players like Raymond. Likewise. the branded apparel market—is now worth nearly $ 3 billion. Spread over a carpet area of 1350 square feet. usage of credit card has increased a lot. most players used the franchise route to expand. increasing working-women population and emerging opportunities in the services sector have increased the average consumer spend on branded clothing. Peter England. quality retailing was limited to high streets and standalone departmental stores.500 square feet space. companies are using their own funds to increase the capacities of their retail stores. The new stores have a minimum 1. companies are now quickly branching to smaller cities in an effort to cash in on the consumer boom.
Encouraged by this success. www. the company has opened a second mega store and is planning a third in the near future.ibef. there is a fivefold difference in per capita income in apparel . Spurred by these successes. This is followed by grocery stores Following the past trends and business models in the west retail giants such as Pantaloon. this single store logged sales of nearly US $ 205. Last year. Some Facts about Indian Apparel Industry: • India’s top retailers are largely lifestyle.com/doc/2100112/Indian-Retail-Sector\ www. clothing and apparel stores.scribd.aspx?tdy=1&cat_id=60&art_id=20386 • Even within the top income segments.000. 2. a slew of new retail entrepreneurs chains are investing heavily to cash in on India’s US $ 15 billion clothing market. Shoppers’ Stop and Lifestyle are likely to target metros and small cities almost doubling their current number of stores • Source: 1.mezzanine.org/artdisplay.
1992 the name was changed to Pantaloon Fashions (India) Limited and in the same year the Company made an initial public offering. 1991 and on September 25. 1987 as Manz Wear Private Limited. Source: 1) www.pantaloon.Some of the major Indian Players: • • • • • • • • Pantaloons Globus Lifestyle Ebony Westside Shopper’s Stop Metro Pyramid Introduction to some retail stores: • Pantaloons: This Company was incorporated on October 12.scribd.com/companyinfo.asp Pantaloons believes in managing customer expectation by offering them all the requirements for their entire family under one roof is the key to being a successful .com/doc/47945/McKinsey-MGI-india-consumer-full-report 2) www. The Company was converted into a public limited company on September 20. Later they changed their name to Pantaloon Retail (India) Limited on July 7 1999.
Globus is a part of the Rajan Raheja group. started in the year 1991 with its first store in Andheri. Pantaloons clearly define Lifestyle products under Private Labels and third party brands. promotion and special shopping hours. The company opened its first store in 1999 at Indore followed by the launch of its second store in Chennai (T-Nagar). by World Retail Congress at Barcelona. 2008 Shopper’s stop has co-branded credit card tie-up with Citibank to provide its customers with exclusive benefits for shopping. The Globus has a Privilege Club card which is very unique in a way that Members are immediately rewarded for purchases at any of their stores. in addition to a host of other privileges such as exclusive tie ups. • Globus : Launched in January 1998. It is divided hierarchically into one star. and hence have built their business model around ‘Family focus’ rather than ‘individual focus’. This is why Globus offers 2 different card categories. They have a loyalty card programme with a name of ‘Green Card'. three star and five star. on April 10. To each his own individual needs vary. Every point generated at all the levels is equivalent to Rs. Mumbai Shoppers Stop Ltd has been awarded "the Hall of Fame" and won "the Emerging Market Retailer of the Year Award". • Shopper’s Stop: Shoppers Stop is an Indian department stores promoted by the K Raheja Corp Group (Chandru L Raheja Group).1 .1 It also stays in touch with its loyal customers through Mailers. each with it own benefits designed to suit the needs of the customers.retailer. The Company has launched a new consumer promotion called ‘Make Your Own Sale Day’. Shopper’s stop has a loyalty card program with the name of first citizen card wherein Every point generated at all the levels is equivalent to Rs. SMS’s E-mails and Telephone informing them about the developments and promotions.
With over 30 years’ experience in retailing.100 is received. Lifestyle India began operations in 1999 with its first store in Chennai. Westside idea is Club West. gift voucher of Rs. 1 point is earned.chipsbooks. the Group has become one of the foremost retailers in the Gulf. home delivery of alterations. For every 100 points earned.000-plus members of this club get rebates at restaurants and on holiday packages from the Taj Group of Hotels.• Westside: Established in 1998 as a part of TATA group. Lifestyle has a loyalty card programme Known as the ‘The Inner Circle ' For every Rs. and best of all. • Lifestyle Lifestyle International (P) Ltd is part of the Landmark Group. youthful and vibrant brand that offers customers a wide variety of merchandise at an exceptional value for money.globus.org/wiki/Shoppers'_Stop Comparison Between different players: .in 2) http://www.com/lifestyl. special shopping hours on the first day of any discount sales event organized by the chain.htm 3) en.wikipedia. a Dubai – based retail chain. The 30.50 spent at any of the stores. Source: 1) www. Positioned as a trendy. a customer loyalty programme launched in May 2001.
In electronic store (SMS. . Loyalty card Programme 4. Festive Promotions (Diwali.print. women & children Rs. free Lucky draw. hoardings. Print & electronic media. footwear & accessories Rs199-1999 Family store Unique & high quality Family Store Apparel accessories for men. Hoardings. electronic.1800 Apparel accessories for men. In store Print. POP Price off. Email. Hoardings. Christmas etc) 3. Media used Yes Yes No Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes (Exchange offer ) Yes No No No No Yes No No No Hoardings. In store Cause related Discounts. women & children Rs. 800 Family store categories Apparel accessories for men. 300-999 Multibrand Exclusive Tata Trent group Style & affordability Stylized clothes. 7. Special Promotion (event) 5.Store Name Pantaloons lifestyle Globus Shopper’s Stop Westside Format Type Positioning Multibrand Multibrand Exclusive own private labeled brand Fashion at afforfability Apparel & accessories for men. Hoardings. In store gift vouchers. Joint promotion 6. women Rs.1200 Average billing per customer Average footfalls 1000on weekday & 1500 to 2000 on weekends. holidays 1200 in week days & 6000 during week end 2000 in week days & 7400 durin week end 1200 in week days & 7000 during week end 25-45 per hour Sales promotion: 1. women & children Rs. End of season 2.
Indian brands will have to withstand turbulent conditions and learn to survive. Using tools such as secure Web portals. enabling maximum responsiveness . Retail Touch Points: Pull preferred over Push: A “pull” supply chain driven by actual consumer demand is preferable to a “push” supply chain driven by manufacturer and retailer promotion. insight-driven retailers propagate current consumer demand data throughout the supply chain. If the role of such activities is understood well it may help any player a long way to survive and grow. are no longer interested in being told what products to buy. thanks to the Internet and personal electronic devices. They will bring many promotional practices which they have been following in developed markets which will increase the use of sales promotion activities even further. Customers who are used to literally having the world at their fingertips. Many multinational players either have already plunged into Indian market or plan to do so in apparel sector.Future outlook Apparel sector is likely to grow with growing Indian economy.
Every experience should be completely satisfactory. Best CRM strategies should be implemented helping the customers to save the money. responsiveness and market trends. forecasted demand. and profit potential. . marketing effectiveness.” Localized Product Assortments: By localizing the merchandising and assortment plans at the individual store level. as well as tangible benefits. increases customer satisfaction levels and market basket sizes. The more useful way to think about CRM is as a process that will help bring together lots of pieces of information about customers. creating 5 to 10 percent improvements in gross margin dollars and improved inventory turn Space Optimization : It allows retailers to use every square inch of selling space to its maximum profit potential. some delightful. as well as decreases the amount of unsold inventory in the supply chain and even levels of “safety stock.and agility. time and heartburn by providing comprehensive customer reviews at a click. It is a process or methodology used to learn more about customers' needs and behaviors in order to develop stronger relationships with them. Assortment plans can thus be executed in a manner that maximizes the sales potential of floor selling space. forecasting and optimization practices can improve the accuracy of buying and allocating merchandise. sales. but thinking about CRM in primarily technological terms is a mistake. Retailers who embed customer SKU preferences into their profiling. This. CRM stands for Customer Relationship Management. in turn. What is CRM ?? What ever the customer buys for him. a store can reap significant intangible benefits. There are many technological components to CRM. Optimization systems take in information such as store sales. customer preferences and product sizes to produce space plans based on business rules. such as higher margins and increased basket sizes. such as improved customer satisfaction levels. Source: 1) Article from Oracle Retail by Dave Boyce.
analyzing and trying to utilize customer data by turning it into information and knowledge that is actionable. E-retailing has added to the avalanche of data.com/ca/eng/main/home/index. Loyalty programs have allowed retailers to collect and analyze vast quantities of data on purchases by individuals. While this information is essential to understanding changing customer needs and expectations. retailers spend an excessive amount of time and money collecting. the question is how to create and maintain customer satisfaction. Now a days many retail outlets are using the IT advisory services that will enable them to gather and evaluate critical customer information. Loyal employees help bring in the business. Source: 1) 2) http://www.creatingloyalty. it's important that the systems you use to gather this information are efficient and cost-effective.Dimensions of CRM: • • • Identifying the customers Acquiring the customers Retaining the customers A store should be customer-oriented .pwc. Also employees should be trained in much better way because if the employees will be loyal only then customers can be loyal. CRM acts as a central repository of information on clients and potential clients of any store.com/story. assess customer requirements and develop customer plans and strategies.html Every business organization depends on customers for sustenance. especially in our technology rich and information based society.cfm?article_id=625 http://www. . the design everything should be geared to making the buying experience as good as possible.the technology. the supply chain. Every business communicates with their clients in many different ways. How we treat all of this information is where CRM plays a key role. Foremost thing for better CRM: Getting value out of real time customer information Today.
from manufacture to checkout and compared to Universal Product Code (UPC) bar coding. In a matter of seconds. The new developments create an easy way for users to generate bar codes on demand for asset tracking. distribution. This enhanced visibility could significantly decrease warehouse. and enhance customer service. The macro-areas where RFID can be utilized are: EAS (Electronic Article Surveillance) systems: The use of tags and antennas usually inside a retail setting for tracking articles.Customer Relation-Profile When mapping the quality of a customer relationship. and other business productivity improvements. increase margins. compliance labeling. Customer Relations Management (CRM) and Technology in Retail Over the years as the consumer demand increased and the retailers geared up to meet this increase. The hardware and software tools that have now become almost essential for retailing can be into 3 broad categories. All that the consumer has to do is to pay for the goods. technology evolved rapidly to support this growth. RFID proactively transmits information. and inventory costs. RFID (Radio Frequency Identification) is now the buzzword in retail. use pre-stored data to calculate the cost and generate the total bill for a client. Tunnel Scanning is a new concept where the consumer pushes the full shopping cart through an electronic gate to the point of sale. the items in the cart are hit with laser beams and scanned. the following model is being used symbolizing the communication and co-operation. which RFID promises to replace. Customer Interfacing Systems Bar Coding and Scanners Point of sale systems use scanners and bar coding to identify an item. It is real time tracking of every single product. document tracking. and the Legs concern the responsibility and professionalism with which we implement or deliver the competencies we have agreed upon. . eliminating the manual point-and-read operations needed with bar coding.
Internet Internet is also rapidly evolving as a customer interface. processes a cheque electronically by transmitting transaction information to the retailer and consumer's bank. getting his supplies on time. mail order and the Internet has provided retailers with real access to consumer data. Electronic cheque conversion. removing the need of a consumer physically visiting the store. along with the various available CRM (Customer Relationship Management) Systems. preventing stock-outs and thus reducing his costs. while transponders are placed on moveable items. Operation Support Systems ERP System Various ERP vendors have developed retail-specific systems which help in integrating all the functions from warehousing to distribution. Networked systems: fixed position readers those are directly connected to centralized information management system. Positioning systems: Used for automated location identification of tagged items or vehicles Payment Payment through credit cards has become quite widespread and this enables a fast and easy payment process. Data warehousing & mining technologies offers retailers the tools they need to make sense of their consumer data and apply it to business. the retailer voids it and hands it back to the consumer along with a receipt. which makes the process very fast. Portable Data Capture systems: portable RFID systems that can be used anywhere. . Rather than manually process a cheque. while servicing the customer better. having digitally captured and stored the image of the cheque. a recent development in this area. This. An integrated supply chain helps the retailer in maintaining his stocks. front and back office store systems and merchandising. CRM Systems The rise of loyalty programs.
These APS packages complement existing (but often limited) ERP packages.allows the retailers to study the purchase behavior of consumers in detail and grow the value of individual consumers to their businesses. Visual Merchandising The decision on how to place & stack items in a store is no more taken on the gut feel of the store manager. They enable consolidation of activities such as long term budgeting. Advanced Planning and Scheduling Systems APS systems can provide improved control across the supply chain. A larger number of visual merchandising tools are available to him to evaluate the impact of his stacking options. Today. all the way from raw material supplier’s right through to the retail shelf. software packages are helping retailers not only in their locational decisions but in decisions regarding store sizing and floor-spaces as well. Strategic Decision Support Systems Store Site Location Demographics and buying patterns of residents of an area can be used to compare various possible sites for opening new stores. CRM MODEL . monthly forecasting. weekly factory scheduling and daily distribution scheduling into one overall planning process using a single set of data.
The essence of this process is mutually to discover weak. If organization want an "easy to use tool" to realize how organization can maximize business relations. strong and wanted sides of the organizations. this is the tool for organization and organization. Using the Customer Relation Profile. organization should be able to identify the terms of relationship with others and the profile will indicate what to focus on if organization want to develop it further. in order to improve future relations. Customer Loyalty: .
we all face time and cost trade-offs. and then being held hostage by the checkout process. As busy consumers. over a long period of time. One way to take action on customer feedback would be to develop training programs geared toward those responsible for fostering the customer experience in the store.It is becoming more and more evident to retailers that the customer shopping experience is a critical pathway to the financial success of the store. Surprisingly. easily located products. Literature Review: . and checkout experience. Without that help and support they become easily frustrated. Even in today's self-service retailing environment. stores with higher levels of customer loyalty should see higher same store sale increases year over year. Not that pricing is inconsequential or immaterial to the consumer's choice of where to shop. and eventually shop at the competition. It is not until a store is confronted with unacceptable scores that they take the time to understand what to do with the customer feedback information. finding exactly what you want. There are a lot of components to the shopping experience such as availability of parking. price is an element we do not find to be a significant driver of loyalty. These programs would teach what actions are necessary to improve low scores. customers still need to be guided into finding the right products. There is nothing worse than having a great shopping experience. Setting aside unique location or competitive differences. Likewise. It is not surprising that the personal interaction of store associates is a significant component of driving loyalty. bad customer service will result in brand and profitability erosion. Loyalty is most influenced by the shopping experience and the brand (the cumulative impact of many experiences over time). friendliness and helpfulness of sales staff. but if price were the only thing driving loyalty we would all be frequenting garage sales and flea markets. Retailers figuring out the best ways to make the checkout process more effective through the use of technology are the most successful in the long run. store cleanliness.
(2000) examined Prestige clothing shopping by consumers by a confirmatory assessment and refinement of the PRECON scale. mandate for most of these early adopters seems to be “customer loyalty at any cost-even is we don’t see a return on investment. Goebel. Aspects studied include background on the symbolic aspects of consumption. Ginger A. Kincade.Several studies on CRM and apparel retail sector are reported in the context of developed markets. A brief overview is presented below: According to Pine and Gilmore (1999) experiences can be described by two dimensions. prestige shopping behavior. Results indicated that monetary support was regarded as the most important promotional support.. In the recent information Week survey. A positive and . Daniel J. The paper concludes with managerial implications for the United States apparel retailers dealing in prestige clothing. The second dimension of experience describes the degree to which the customer adsorbs or immerses the experience. Bitner and Zenithal (2003) stated that satisfaction is the customer’s evaluation of a product or service has met their needs & expectations. reassessment and refinement of the PRECON scale and impact of income and age on prestige shopping. of the companies actively implementing CRM. Doris H. and to investigate the relationship between offering frequency and perceptions of importance. The Second highest percentage. Jesse N. Dawn R. Park. 93 percent claimed increased customer loyalty and customer Satisfaction would justify their CRM investment. Moore. Haesun (2002) studied Buyer–seller relationships for promotional support in the apparel sector which is critical for success.. stated the need to demonstrate increased revenue.. you need to sell maximum products over a long period of time and across different product lines.” Peppers and Rogers (1993) stated that to build the relationships with your individual customers.. to identify the retailer's perceptions of the offering frequency and importance of the promotional support. Deeter-Schmelz. 83 percent. The purpose of the study was to define promotional support categories offered to apparel retailers by manufacturers. The implied. The first dimension refers to the customer’s degree of active participation in the creation of the experience. Woodard..
and perceptions of the impact of foreign retailers on local communities. apparel product country of manufacture and price. . Thus there is a need to consider patronage to decide rewards for loyalty programmes. Miguel Angel Gomez (2005). The study examined consumers' store patronage and apparel purchase behaviour. Alejandro Molla. Christophe. In contrast. (2006) studied the Impact of Loyalty Programmes on Repeat Purchase Behaviour based on the Behavior Scan single-source panel which has been compared with the store data base . Karen. national brands and store layout. the study found out that consumers who were heavy buyers at the beginning of a loyalty program were most likely to claim their qualified rewards. product assortment. The study emphasized that speciality retailers' success in international markets is contingent upon their knowledge of culturally-defined values. For light buyers. Meyer-Waarden. norms and behaviour that influence consumer decision making and impact acceptance of products and services. Liu. When all companies had loyalty programs. the market was characterized by an absence of change of the competitive situation. (2007) found out the Long-Term Impact of Loyalty Programs on Consumer Purchase Behavior and Loyalty. In the context of French market. Using longitudinal data from a convenience store franchise. The double jeopardy phenomenon was present and loyalty programmes did not substantially change market structures. Benavent. Yuping.significant correlation was found between items the buyers perceived as important and the frequency of offerings of these items. Eckman. Molly. payment options. consumers whose initial patronage levels were low or moderate gradually purchased more and became more loyal to the firm. It found out that the perceptions differed regarding quality. fashionability. Borja. the loyalty program broadened their relationship with the firm into other business areas. Consumers' acceptance of US apparel brands was a function of age. Descals. acceptance of US apparel brands. convenience of location. but the program did not prompt them to change their purchase behavior. household income. perceptions of retailers' products and services. extent and quality of customer service. studied Spanish consumers' perceptions of US apparel speciality retailers' products and services. Lars. Hyllegard.
Woodard.. Feb2006.. 4 Issue 5. Winter2005 Issue 48. 7. Borja.” Journal of Marketing. 17p. Benavent. Jeff. Lars. 18p. ”Spanish consumers' perceptions of US apparel speciality retailers' products and services “Journal of Consumer Behaviour. International Journal of Consumer Studies.com/lib/textile/textile07301998. Hyllegard. (2000).indiamart. Journal of the Academy of Marketing Science 28(1). September 15. Haesun.” The Long-Term Impact of Loyalty Programs on Consumer Purchase Behavior and Loyalty. Ph. p19-35. Liu.” European Retail Digest. Sep2005. “Consumer Lifestyles in India” Euromonitor.”. “Global Apparel. Jesse N. Alejandro Molla. 5. Vol. 6. Oct2007.” Information Week via COMTEX online.. Daniel J. Meyer-Waarden. New York:Doubleday. 71 Issue 4. The one to one future: Building Relationships One Customer At a Time. Lara. Dawn R.html 2. p61-88.scribd. Deeter-Schmelz.References: 1.com/doc/95637/Customer-Relationship-Management . http://apparel. Vol.” prestige clothing shopping by consumers: a confirmatory assessment and refinement of the precon scale with managerial implications”.A. Dec2002.” Journal of Marketing Management. p43. http://www.. 26 Issue 4.. 3. Accessories and Luxury Goods” Datamonitor.” The Impact of Loyalty Programmes on Repeat Purchase Behaviour.D.. 8 Issue 4. Eckman.. Moore.” Exploring the Benefits Obtained in a Loyalty Programme applied to Retailing. 12. 9p. p48-52. Zeithaml.. Descals. Vol. and the economic worth of customers: Wwhat we know and what we need to learn.. Fall2000. Christophe. Karen. Ginger A. 22 Issue 1/2. 7 charts. Journal of Marketing Theory & Practice. Park. Vol. Vol. Sweat. p345-362. Peppers. Doris H. 28p. Pedro Reinares. Kincade. 16p. profitability. MiguelAngel Gomez. Service quality. International Consumer Lifestyles Database(2005) 9. 67-85 11. 4. 8. Molly. (2006) 10.2000. 5p.1993 13. Yuping. p294-302. “Lots of companies are thinking about customer relationship management. But progress can be very slow-CRM under scrutiny. V. Don and Martha Rogers. Goebel.
RESEARCH DESIGN Research objectives The survey was conducted among the customers shopping in the mall. interaction and customization. which indicates the strength and direction of association between the two variables.0 and +1. terms of CRM To get an insight of the Retailer’s perspective towards the customer’s expectation in The research instrument The research instrument used was developed to measure both the expectations and perceptions of the customers of the Lifestyle Stores. the applications of IT. The level of association as measured by Pearson’s co-efficient falls between -1.0. were distributed to the people in a mall. . Use was made of a five-point Likert scale. The measure was standardized through computation of reliability & validity. Statistical analysis The statistical treatment of the study included the determination of the association between the steps in the CRM model and the customer service offered by the organization. to measure the respondents’ perceptions and expectations. Qualitative Analysis of the Retailer’s Perspective was done to get an insight of their perception towards the customers expectations & to study the CRM strategies implemented by them esp. differentiation. The main body of the questionnaire included 11 questions reflecting customer service. identification. Use was made of Pearson’s coefficient to determine the level of association between the store attributes. The two questionnaire were developed hypothesis were formulated to reflect the associations between the different Lifestyle Stores and the customer service offered by them. To study the perception of customers towards the CRM strategies implemented by the different Lifstyle Stores. To do the comparative analysis of different Lifestyle Stores on different store dimensions. customer service & the customer loyalty. Also to evaluate the different Gender’s opinions towards the Customer services they are getting from the lifestyle stores & to evaluate the retailer’s perception about the customer’s expectations. Structured questionnaires. T-test was applied in order to compare significant difference between the store attributes of different lifestyle store. To study the association between the Customer’s Services & the Customer Loyalty. A total of 200 questionnaires were distributed to the people.
The brand’s recent revival was a result of several key strategic plans. CONCLUSIONS The luxury goods industry is unique in a sense that it relies solely on promotion and marketing to sell products and not so much on product attributes but on the individual images certain brands convey. The lifestyle stores find customer loyalty to be of utmost importance and would do almost anything to attract new customers while trying to keep existing customers. For consumers Luxury means exclusivity. industry types will attempt to provide styles of clothing that will keep up with the current season’s trends and for which they are able to command a price premium. Key strategic initiatives included: “the muchvalued positioning as a lifestyle brand. However the lifestyle stores are is very fascinating and the products themselves signify prestige and status. It is also an industry that is well guarded and difficult to find any information on.The companies serve two types of consumers: for the practical consumer. But every customer has a different perception Although a select few are able to afford luxury goods. One can come to the conclusion that the designer clothing industry is pretty volatile and subject to unpredictable swings which is reflected in the quality. The store focuses on accessibility while maintaining its exclusivity and protecting its tradition and heritage while striving to be innovative and inspiring. and for the fashion-conscious consumer. flagship stores and presence in high-end department stores. The demand for Apparels are affected by general economic trends . . the vast majority of people who are exposed to advertisements for certain products generally have aspirations of being able to own these products someday. expansion of licenses into areas such as watches and sunglasses and a product mix toward accessories and gifts. they provide sensible and affordable clothing whose styles will not change drastically from year to year. The apparel industry exists in a very competitive environment where companies need to adopt new technologies in order to improve profitability and lower costs.
To study the perception of customers towards the CRM strategies implemented by the different Lifstyle Stores. the presence of competition. To do the comparative analysis of different Lifestyle Stores on different store dimensions. Both Exploratory & Causal Research Design were taken Research objectives: The survey was conducted among the customers shopping in the mall. The main factors in such a study were customer demographics. RESEARCH DESIGN The study is exploratory in nature with survey method being used to complete the study. The allure for many designer products is people’s desire for wealth and status.In the past three years. but for everyone else luxury goods are items that many aspire to be able to own someday. For the wealthy. An example of this would be the Consumer’s make a use of internet. Also to evaluate the different Gender’s opinions towards the Customer services they are getting from the lifestyle stores & to evaluate the retailer’s perception about the customer’s expectations. which is ultimately the end product that is consumed. It is an idea of status and exclusivity that makes these brands sought-after by people from many different walks of life. To study the association between the Customer’s Services & the Customer Loyalty. To get an insight of the Retailer’s perspective towards the customer’s expectation in terms of CRM The Research Instrument The research instrument used was developed to measure both the expectations and perceptions of the customers of the Lifestyle Stores. The two questionnaire were developed hypothesis were formulated to reflect the associations between the different Lifestyle Stores and the customer service offered by them. luxury goods reinforce their status as a member of the upper class. physical store . luxury goods brands have been broadening their appeal to a wider consumer base. companies have realized the importance of e-commerce and how the Internet can be advantageous for Lifestyle Stores to create and reinforce their brand image and at the same time increasing brand awareness.
the applications of IT.0 and +1. Discussion of the specific findings H1: Identifying new and existing clients increases the level of customer service. Statistical analysis The statistical treatment of the study included the determination of the association between the steps in the CRM model and the customer service offered by the organization. Use was made of Pearson’s coefficient to determine the level of association between the store attributes. The measure was standardized through computation of reliability & validity.characteristics. which indicates the strength and direction of association between the two variables. A total of 200 questionnaires were distributed to the people. to measure the respondents’ perceptions and expectations. Use was made of a five-point Likert scale. Structured questionnaires. The main body of the questionnaire included 11 questions reflecting customer service. CRM technologies and the characteristics of Customer Service Representatives etc. sales promotions. H2: Differentiating between the services offered to new and existing clients increases the level of customer service. H3: The level of customer service is increased if there is an active interaction with potential and offered according to each individual client’s needs. . identification. T-test was applied in order to compare significant difference between the store attributes of different lifestyle store. were distributed to the people in a mall. Qualitative Analysis of the Retailer’s Perspective was done to get an insight of their perception towards the customers expectations & to study the CRM strategies implemented by them esp. customer service & the customer loyalty. The level of association as measured by Pearson’s co-efficient falls between -1.0. interaction and customization. quality. differentiation.
5 43.5 25.5 25.0 100.5 43.0 Valid Business Service Student Total Frequency 63 87 50 200 Percent 31.5 75.0 100.0 Valid Percent 31.0 100.DATA ANALYSIS 1) Occupation * How often do you make your purchase of Apparels? Cross tabulation Count How often do you make your purchase of Apparels? Weekly Occupation Business Service Student Total 8 7 4 19 Monthly 24 53 9 86 Twice in a Month 6 21 2 29 Occasionall y 25 6 35 66 Total 63 87 50 200 Occupation Cumulative Percent 31.0 .
i.i. 44%. The business class people prefer to make the purchase of apparels occasionally but sometimes monthly too.Results: • The service class people prefer to make the purchase of apparels monthly i.e.25% • • .e.e.31% While a student prefer to make the purchase of apparels occasionally.
0 31.5 15.e.e.34% .5 100.5 15.5 34.5 100.0 34.5 65.0 34.1) Income * How often do you make your purchase of Apparels? Cross tabulation Count How often do you make your purchase of Apparels? Weekly Income <12 K 12-18 K 18-30 K >30 K Total 3 2 6 8 19 Income Cumulative Percent 19.0 Monthly 5 20 34 27 86 Twice in a Month 2 2 19 6 29 Occasionally 29 6 3 28 66 Total 39 30 62 69 200 Valid <12 K 12-18 K 18-30 K >30 K Total Frequency 39 30 62 69 200 Percent 19.5 100.0 31.0 Valid Percent 19. • People from income group of >30 K prefer to make the purchase of apparels occasionally. 31%.i.0 Results: • People from income group of 18-30 K prefer to make the purchase of apparels monthly i.
0 Valid Percent 52.0 100. .• People from income group of <12 K prefer to make the purchase of apparels occasionally i.0 48.0 Results: • Out of 104.i.15% • 2) Gender * Do you owe Loyalty Cards? Cross tabulation Count Do you owe Loyalty Cards? Yes No 74 69 143 Gender Cumulative Percent 52.0 100.0 100.20%.0 48. 74 Male respondents have the loyalty cards of different lifestyle Stores.e.e.0 Total 30 27 57 104 96 200 Gender Total Male Female Valid Male Female Total Frequency 104 96 200 Percent 52. People from income group of 12-18 K prefer to make the purchase of apparels monthly.
• Out of 96. . Finding: Females are prone to shopping that is why maximum females have loyalty cards. 69 Female respondents have the loyalty cards of different lifestyle Stores.
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