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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)
3 Challenges for organized retail 1.1 New Retail Entrepreneurs 2.3.2 Characteristics of Apparel retail sector 2.2 Globus 2.No.1 Growth in organized retail 1. Industry Insight – Indian Retail Industry 1.1 Introduction 1.4 Some Facts 1.4 Trent Limited 2.CONTENTS Declaration Certificate from Faculty guide Certificate from Industry Guide Acknowledgement S.2 Changing Consumer Behavior 2.2 Evolution of Retail 1.3 Shopper’s Stop Limited 2.1 Pantaloon Retail (India) Limited 2. 1 Introduction 1. Apparel Retail in India 2.1 Overview 2.5 Marketing segmentation of retail industry 2.2.2 Drivers for retail transformation in India 1.2.3 Some Facts about Indian Apparel Industry 2.1.3 From Franchise to Company Owned 2.3 Major Players 188.8.131.52 Lifestyle International (Pvt) Limited .3.1. Chapter Name Page No.3 Retailing Formats in India 184.108.40.206.
4 Managerial Challenges 2.1 Introduction 3.3 Customer Retention Profile 3.5 Future Outlook 2.6 comparison between different players 2.4 CRM & IT 2 3 4 5 6 References Annexure Literature Review Problem Statement Methodology Results & Discussions Suggestions & Conclusion . Customer Relationship Management 3.2 Dimensions of CRM 3.2.6 Retail Touch points 3.3.
85 trillion) business by 2015. 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. supermarkets and specialty stores. Western-style malls have begun appearing in metros and second-rung cities alike introducing the Indian consumer to a shopping experience like never before. Along the way. The Indian Retail Sector The Indian Retail Sector is at an inflexion point. Further. 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. the country’s overall retail sector will become a $450 billion (Rs20. With changing demographic and economic profile of the Indian population. hypermarkets. to McKinsey. With declining interest rates an average Indian is not averse to taking loans. the modern retail business will create about 1. apparel and consumer durables are the top three categories of consumer spend and form 87% of the total retail sales in India. With an expanding economy. . with changing demographics driving growth of organized retailing and driving growth in consumption.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. Food and beverages. it is also believed that increase in consumer spending would be driven by nuclearisation of families. it is believed that India is expected to experience accelerated consumption over the next few years. increasing population of working women and new job opportunities in emerging service sectors such as IT Enabled Services. At present India’s modern retail business accounts for only about 5% of the country’s annual retail business.6 million jobs in the next five years acc.
with modern formats of retailing emerging. 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. The spread between yield on property and its financing cost has turned positive with the . In the past. However. However. Availability of quality retail space has been one of the main constraints for development of organized formats in India.org/artdisplay. 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.Source: 1) www.ibef. greater selection. 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. most of these retail outlets belong to the unorganized sector.aspx?tdy=1&cat_id=60&art_id=20386 Growth in organized retail In sharp contrast to the global retail sector. Organized retail derives its advantages in generating operational efficiencies while simultaneously catering to rising consumer aspirations. With close to 12 million retail outlets India has the largest retail density in the world. retailing in India – though large in terms of size – is highly fragmented and unorganized. Size drives economies on procurement. and lowers logistics and marketing costs while delivering better value to customers in terms of lower price. improved service and in store ambience. organized retail has to overcome significant challenges in terms of regulations and infrastructural barriers in order to realize its full potential. Drivers for retail transformation in India A number of factors that drive transformation in retail – such as income growth. better quality.
html Challenges for organized retail There exist differential sales tax rates across states in India . equity options are also restricted with Foreign Direct Investment not being permitted in the retail sector.com/Faculty_Column/FC460/fc460. limiting funding from banks and financial institutions. Similarly. At the same time. Most of the world’s leading brands are now present in India. With growing opportunities in the emerging service sectors such as ITES. The capital requirements for a retailer are in real estate (which banks have historically restricted lending to) and for working capital requirements. The retail sector has not been granted industry status. Consumerism and brand proliferation has been another enabler for organized retailing in India. with growing size of operations. there is large-scale sales tax evasion by smaller stores who derive significant cost advantage through such evasion. In India. both vendor management and logistics management are still undeveloped. Supply chain management efficiencies are essential to retailers to maintain and improve margins. Value Retailing . supply chain efficiencies will become a key differentiator of profitability in retail. However.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.fall in interest rates. the ability of the retail business to hire and retain quality people is under pressure.indianmba. the smaller ones are constrained for growth funding. FDI restrictions have also restricted entry of international majors in retailing in India. Attractive yields on investments have resulted in sharp increase in property development. Source: www. which could have Otherwise helped the industry develop with funding as well as bringing in of best practices and systems. The availability of trained manpower poses a key risk for the retail sector. While some of the leading retailers are still able to get bank funding.
The larger chains of department stores (Namely Pantaloons’. They stock multiple brands across product categories. though some of them focus on their in house store label (on the lines of Marks & Spencer’s and St. Several local department store chains have opened shop in India in the past five years. and Lifestyle) have presence in the metros and mini metros. Michael). The convenience factor coupled with the inspirational perception of shopping in a department store has contributed to their growth. Nilgiris. Star India. cosmetics and household products. The share of expenditure on food and grocery in a consumer’s wallet. The larger chain of supermarkets and hypermarkets (namely Big Bazaar.These stores primarily retail primarily food and house hold items. Evolution of Retail . Lifestyle retailing These stores retail primarily non-food items such as apparel. availability of a vide variety of products at a reasonable price are the main factors which has contributed to the growth of this segment. Food world) has presence in metros and mini metros. Westside. These are primarily large stores with volume based discounted prices. Shoppers’ Stop. accessories. These stores are found on high streets and as Anchor Tenants of shopping malls. footwear.
com/india India’s five main consumer segments: .ey.Source: 1) www.
Located mainly in metro cities. Ranges from 60. are focusing on specific market segments and have established themselves strongly in their sectors. They lend an ideal shopping experience with an amalgamation of product.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. Specialty Stores: Chains such as the Bangalore based Kids Kemp.000 sq ft to 7. Pyramid. . Examples include Shoppers Stop.scribd.000 sq ft and above. the Mumbai books retailer Crossword. 00. www. and Pantaloon. service and entertainment. in proximity to urban outskirts. all under a common roof.Source: 1. 2.
the biggest success is K Raheja's Shoppers Stop.scribd.500 sq ft to 5. Super Markets can further be classified in to mini supermarkets typically 1.Discount Stores: As the name suggests. These are located in or near residential high streets. offer discounts on the MRP through selling in bulk reaching economies of scale or excess stock left over at the season. These stores today contribute to 30% of all food & grocery organized retail sales. catering to varied shopper needs are termed as Supermarkets.000 sq ft to 2. having a strong focus on food & grocery and personal sales. also known as Category Killers. These usually do well in busy market places and Metros. 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. MBO’s: Multi Brand outlets.000 sq ft. offer several brands across a single product category. Prices are slightly higher due to the convenience premium.000 sq. discount stores or factory outlets.000 sq. They stock a limited range of high-turnover convenience products and are usually open for extended periods during the day.000 sq ft and large supermarkets ranging from of 3. ft) across India and even has its own in store brand for clothes called Stop!. Hyper marts/Supermarkets: Large self service outlets. Among these. . which started in Mumbai and now has more than seven large stores (over 30.com/doc/4782190/The-Indian-Retail-Snapshot Convenience Stores: These are relatively small stores 400-2. Source: 1) http://www. seven days a week. feet located near residential areas.
and quickly.110. ideas and lifestyles are moving concurrently. mundane products for years have now tripled their product ranges and new appealing shapes and forms are being launched each Season. Top-notch fashion professionals came together four years ago to form the Fashion Design Council of India. 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 . fashion in India is becoming more stratified.com/doc/4782190/The-Indian-Retail-Snapshot APPAREL RETAIL: Moving Beyond Customer Expectations The influence of fashion clearly.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.scribd. As lifestyles change.000 Cr(USD 25 b) by 2010 Share of all the segments in retail: Source: 1) http://www. Companies and brands that offered monotonous. fashion has also played an important role in shaping apparel consumerism. as in the West. Technology.
000 crores. Yet it has now set up its own stand-alone stores. India has huge potential as a market for foreign clothing. Now. Today not only is the garment export business growing. tells only part of the story.35. A few significant foreign players—such as Levi Strauss. enthusiasm in the minds of the foreign buyers is also at a high. But now.000 crores of which apparel occupied over Rs14. and forward linkages with the retail and distribution network. has a limited range exhibited in generic department stores located in metro cities. given its large population and growing household incomes. instead of just selling through departmental stores. nevertheless. The 1996 Indian textile exports approximately amounted to Rs. 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. accounting for nearly 16% of the country's total exports. Source: 1) http://apparel. Today many leading fashion labels are being associated with Indian products.html It has been estimated that India has approximately 30. for example. just like their Indian counterparts. The boom in domestic apparel. Ralph Lauren.com/lib/garments/indian07251998.indiamart.an Overview: The apparel industry is one of India's largest foreign exchange earners. Indian Apparel Industry. The credit for this goes to our exporter community.000 readymade garment manufacturing units and around three million people are working in the 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. 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. global apparel brands are setting up their own apparel outlets. Benetton and Lacoste—have been selling their branded apparel in India for a number of years. which showcase all the company’s brands.National Institute of Fashion Technology. .
there is no reason for complacency on the part of Indian exporters or of the garment industry. relatively high fashion. affluent urban Indian women are shopping like never before. Ready-made apparel accounted for an estimated 20% of domestic clothing sales in 2005. clothing retail accounts for 36% of organized retail business. These are designer clothes that incorporate Indian motifs. India is a film-crazy nation. Westside and Pantaloon . Inculcation of a spirit of innovation by way of research and development and tapping new markets especially in South Africa. With growing working women wearing western wear to work. But till today. With the advent of modern format retailers and the growth of plastic cards. market for good readymade clothes is likely to grow. India's supply base is medium quality. improving technical capabilities and putting together an attractive and wide merchandise line has paid rich dividends. East European countries. like Shoppers Stop. ethnic fabrics and are a fusion of western and Indian styles. In India. and the largest producer of films. Recent recession in Europe and the South Asian currency crisis have also contributed their own bits to the decimating Indian exports. Though these are expected to fizzle out soon.000 every year. Latin America and Australia is also mandatory for export growth. In the large urban centres. but small volume business. with more than 1. footwear. our clothing industry is dominated by sub-contractors and consists mainly of small units of 50 to 60 machines. They provide entertainment and an escape from reality for India’s masses. Upper income urban women are adopting ethnic chic.org They spend mornings browsing in stores looking for deals or latest styles. It is the largest Sector. Source: 1) www. Bollywood fashions have become pan Indian. Thus the need of the hour is to enlarge both manufacturing as well as the marketing base. They affect various sectors of the market including clothing. apparel retailers. and pressed for time. weddings and fashion accessories. CIS.ibef.Consistent efforts towards extensive market coverage. The industry will be soon faced with open competition shorn of quotas or tariffs. Central Africa. and set the popular fashion trend.
Importance of store layout. Typically once an item is sold from the outlet. Attractive promotions induces purchase acceleration.511 billion ( USD 38 billion) . which includes apparel of men. Customers have loyalty to a store rather than any particular garment brand. goes down substantially and inventory carrying burden turns out to be very high. Role of Bollywood in spreading fashion needs to be understood. Characteristics of Apparel retail sector As apparel retail is led by fashion. Customers look to design and fit of the clothes. It gets replaced by different design. Westside carries only its own private labels. colour. retailer ensures that there is no repetition of same. for instance.short term activities which induces trade or consumer to buy now rather than in future as the value of apparel after the season. 20-30% of their apparel turnover is from private labels. Westside has `Club West' to Woo the customers. has a loyalty programme called `The Inner Circle'. while for the other stores. This has led to a thriving unbranded or local brand market for ready-to-wear clothes leading to severe competition. Indian textile and clothing industry during 2006 is estimated to be about INR1. 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. and use the shop’s name as a quality standard. Hence organized retailers like Lifestyle. while Pantaloons offers a `Green Card' Rewards programmes. a player needs to keep a close watch on fashion amongst teenagers as they are the trend setters. Seasonal variations on stocking pattern and need to clear inventory at the end of season should be understood by apparel retailer. style. which have attracted urban shoppers.have popularized their private labels. stock piling and brand switching on the part of a consumer which substantially reduces retailer’s financial and inventory risk and . Apparel retailer needs to understand critical role of sales promotions. This highlights the importance of sales promotions. women and kids . 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.
brands have started shaping buying behavior.ernet. Spykar has set up approx 35 stores across the country in all the major cities.pdf Changing Consumer Behavior But suddenly. Lifestyle. Branded apparel merchandising is gathering critical momentum in India.iimahd. Bangalore-based TCNS Clothing has more than 37 stores across the country.earlier owns seven stores located across various metro cities.in/publications/data/2007-07-01Preeta. the company is expanding to other north Indian states. its brands and promote new brands. If the customer will purchase first then only he/she can be loyal so in order to retail the existing & attracting the new ones. a part of the Dubai-based Landmark Group retail chain. Mumbai-based lifestyle chain Pantaloon spends around US $ 840000 in a year to revitalize Shoppers Stop –has more than 35 more Outlets. then company has doubled its presence to 14 stores in 2006. 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. Enter. occupying a combined retail space of one million square feet. Besides sprucing up exiting stores in Delhi and Punjab. company should have best CRM strategies.000 square feet. 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. A large young working population with a median age of 24 years.consumer’s financial risk and psychological risk. growing numbers of nuclear families in urban . Source: 1) www.
areas. Peter England. Madura Garments has opened up a mega store in the heart of Bangalore that sells the company’s flagship brand. companies are now quickly branching to smaller cities in an effort to cash in on the consumer boom. Apparel retailing is no longer a metropolitan phenomenon. usage of credit card has increased a lot. Over the last two years. and nearly per cent of Arvind’s apparel business comes from these outlets. Madura Garments and Zodiac Clothing building extensive retail networks. increasing working-women population and emerging opportunities in the services sector have increased the average consumer spend on branded clothing. semi-ground and . Likewise. From Franchise to Company Owned Larger textile manufacturers were the first off the block in the nineties. most players used the franchise route to expand.is revamping its chain of 300 stores—known as Raymond’s Shops—and focusing on readymades at a cost of around US $ 35 million. Spread over a carpet area of 1350 square feet. the branded apparel market—is now worth nearly $ 3 billion. Raymond’s – the flagship brand of the Singhania Group-. The new stores have a minimum 1. the company management has closed down a number of these small stores and gone in for bigger stores. apparel buying is the second biggest consumption category at malls. Because the market potential was still relatively small in the nineties. Previously. the Arvind Mafatlal Group had a chain of below-1. quality retailing was limited to high streets and standalone departmental stores. 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. Without question. Now.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.500 square feet space. with big players like Raymond. Until recently. Arvind Mills. The logic: the contribution of readymade apparel to total sales has gone up 25-30 percent compared to the previous year. the store is designed to function at three levels—ground. after food products. According to ICICI Bank. companies are using their own funds to increase the capacities of their retail stores. across metros. Now.
2. Encouraged by this success. www.mezzanine. Some Facts about Indian Apparel Industry: • India’s top retailers are largely lifestyle. Shoppers’ Stop and Lifestyle are likely to target metros and small cities almost doubling their current number of stores • Source: 1.org/artdisplay.000.com/doc/2100112/Indian-Retail-Sector\ www. there is a fivefold difference in per capita income in apparel . the company has opened a second mega store and is planning a third in the near future. This is followed by grocery stores Following the past trends and business models in the west retail giants such as Pantaloon.scribd. a slew of new retail entrepreneurs chains are investing heavily to cash in on India’s US $ 15 billion clothing market. this single store logged sales of nearly US $ 205. clothing and apparel stores.aspx?tdy=1&cat_id=60&art_id=20386 • Even within the top income segments. Last year.ibef. Spurred by these successes.
1987 as Manz Wear Private Limited. Later they changed their name to Pantaloon Retail (India) Limited on July 7 1999.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.com/doc/47945/McKinsey-MGI-india-consumer-full-report 2) www. 1992 the name was changed to Pantaloon Fashions (India) Limited and in the same year the Company made an initial public offering.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 . Source: 1) www.scribd. The Company was converted into a public limited company on September 20. 1991 and on September 25.
promotion and special shopping hours. • Shopper’s Stop: Shoppers Stop is an Indian department stores promoted by the K Raheja Corp Group (Chandru L Raheja Group). Every point generated at all the levels is equivalent to Rs.1 . Mumbai Shoppers Stop Ltd has been awarded "the Hall of Fame" and won "the Emerging Market Retailer of the Year Award". each with it own benefits designed to suit the needs of the customers.1 It also stays in touch with its loyal customers through Mailers. They have a loyalty card programme with a name of ‘Green Card'. SMS’s E-mails and Telephone informing them about the developments and promotions. Globus is a part of the Rajan Raheja group. This is why Globus offers 2 different card categories. three star and five star. • Globus : Launched in January 1998. 2008 Shopper’s stop has co-branded credit card tie-up with Citibank to provide its customers with exclusive benefits for shopping. in addition to a host of other privileges such as exclusive tie ups. started in the year 1991 with its first store in Andheri. and hence have built their business model around ‘Family focus’ rather than ‘individual focus’. The Company has launched a new consumer promotion called ‘Make Your Own Sale Day’. 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. It is divided hierarchically into one star. 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. The company opened its first store in 1999 at Indore followed by the launch of its second store in Chennai (T-Nagar). on April 10. Pantaloons clearly define Lifestyle products under Private Labels and third party brands.retailer. by World Retail Congress at Barcelona. To each his own individual needs vary.
wikipedia. and best of all. gift voucher of Rs. Lifestyle has a loyalty card programme Known as the ‘The Inner Circle ' For every Rs. Positioned as a trendy.• Westside: Established in 1998 as a part of TATA group. Westside idea is Club West.htm 3) en.100 is received. a customer loyalty programme launched in May 2001. With over 30 years’ experience in retailing. • Lifestyle Lifestyle International (P) Ltd is part of the Landmark Group.org/wiki/Shoppers'_Stop Comparison Between different players: .chipsbooks. Source: 1) www.000-plus members of this club get rebates at restaurants and on holiday packages from the Taj Group of Hotels.globus. For every 100 points earned. 1 point is earned. Lifestyle India began operations in 1999 with its first store in Chennai. a Dubai – based retail chain.50 spent at any of the stores.com/lifestyl. the Group has become one of the foremost retailers in the Gulf. special shopping hours on the first day of any discount sales event organized by the chain. home delivery of alterations.in 2) http://www. The 30. youthful and vibrant brand that offers customers a wide variety of merchandise at an exceptional value for money.
End of season 2. women Rs. In store Cause related Discounts.1200 Average billing per customer Average footfalls 1000on weekday & 1500 to 2000 on weekends.1800 Apparel accessories for men.print. . women & children Rs.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. Special Promotion (event) 5. In store Print. POP Price off. Christmas etc) 3. In electronic store (SMS. 7. hoardings. footwear & accessories Rs199-1999 Family store Unique & high quality Family Store Apparel accessories for men. 800 Family store categories Apparel accessories for men. Hoardings. 300-999 Multibrand Exclusive Tata Trent group Style & affordability Stylized clothes. women & children Rs. electronic. Email. 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. Hoardings. Loyalty card Programme 4. Hoardings. Joint promotion 6. In store gift vouchers. free Lucky draw. Festive Promotions (Diwali. 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. Print & electronic media. women & children Rs.
Indian brands will have to withstand turbulent conditions and learn to survive. enabling maximum responsiveness . 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. 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.Future outlook Apparel sector is likely to grow with growing Indian economy. If the role of such activities is understood well it may help any player a long way to survive and grow. 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. Using tools such as secure Web portals. insight-driven retailers propagate current consumer demand data throughout the supply chain.
some delightful. It is a process or methodology used to learn more about customers' needs and behaviors in order to develop stronger relationships with them. as well as decreases the amount of unsold inventory in the supply chain and even levels of “safety stock. Every experience should be completely satisfactory. marketing effectiveness. in turn. CRM stands for Customer Relationship Management. forecasted demand. Best CRM strategies should be implemented helping the customers to save the money. This. increases customer satisfaction levels and market basket sizes. customer preferences and product sizes to produce space plans based on business rules. forecasting and optimization practices can improve the accuracy of buying and allocating merchandise. Optimization systems take in information such as store sales. Source: 1) Article from Oracle Retail by Dave Boyce. a store can reap significant intangible benefits. responsiveness and market trends. 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.” Localized Product Assortments: By localizing the merchandising and assortment plans at the individual store level. but thinking about CRM in primarily technological terms is a mistake. Assortment plans can thus be executed in a manner that maximizes the sales potential of floor selling space. such as higher margins and increased basket sizes. time and heartburn by providing comprehensive customer reviews at a click.and agility. as well as tangible benefits. and profit potential. What is CRM ?? What ever the customer buys for him. Retailers who embed customer SKU preferences into their profiling. There are many technological components to CRM. sales. such as improved customer satisfaction levels. . The more useful way to think about CRM is as a process that will help bring together lots of pieces of information about customers.
. Source: 1) 2) http://www. CRM acts as a central repository of information on clients and potential clients of any store.the technology. Also employees should be trained in much better way because if the employees will be loyal only then customers can be loyal. While this information is essential to understanding changing customer needs and expectations. Loyalty programs have allowed retailers to collect and analyze vast quantities of data on purchases by individuals. Now a days many retail outlets are using the IT advisory services that will enable them to gather and evaluate critical customer information.html Every business organization depends on customers for sustenance. the question is how to create and maintain customer satisfaction. Loyal employees help bring in the business. assess customer requirements and develop customer plans and strategies. the supply chain. Every business communicates with their clients in many different ways.Dimensions of CRM: • • • Identifying the customers Acquiring the customers Retaining the customers A store should be customer-oriented . How we treat all of this information is where CRM plays a key role. especially in our technology rich and information based society.creatingloyalty. analyzing and trying to utilize customer data by turning it into information and knowledge that is actionable.com/story.com/ca/eng/main/home/index. E-retailing has added to the avalanche of data.pwc. it's important that the systems you use to gather this information are efficient and cost-effective. the design everything should be geared to making the buying experience as good as possible. retailers spend an excessive amount of time and money collecting. Foremost thing for better CRM: Getting value out of real time customer information Today.cfm?article_id=625 http://www.
eliminating the manual point-and-read operations needed with bar coding. and other business productivity improvements. RFID (Radio Frequency Identification) is now the buzzword in retail. Tunnel Scanning is a new concept where the consumer pushes the full shopping cart through an electronic gate to the point of sale. increase margins. In a matter of seconds. All that the consumer has to do is to pay for the goods. 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. and the Legs concern the responsibility and professionalism with which we implement or deliver the competencies we have agreed upon. compliance labeling.Customer Relation-Profile When mapping the quality of a customer relationship. It is real time tracking of every single product. Customer Interfacing Systems Bar Coding and Scanners Point of sale systems use scanners and bar coding to identify an item. document tracking. The hardware and software tools that have now become almost essential for retailing can be into 3 broad categories. the items in the cart are hit with laser beams and scanned. 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 new developments create an easy way for users to generate bar codes on demand for asset tracking. from manufacture to checkout and compared to Universal Product Code (UPC) bar coding. and inventory costs. distribution. . and enhance customer service. use pre-stored data to calculate the cost and generate the total bill for a client. the following model is being used symbolizing the communication and co-operation. RFID proactively transmits information. This enhanced visibility could significantly decrease warehouse. which RFID promises to replace. technology evolved rapidly to support this growth.
processes a cheque electronically by transmitting transaction information to the retailer and consumer's bank. Internet Internet is also rapidly evolving as a customer interface. 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. This. . CRM Systems The rise of loyalty programs. Data warehousing & mining technologies offers retailers the tools they need to make sense of their consumer data and apply it to business. a recent development in this area. Operation Support Systems ERP System Various ERP vendors have developed retail-specific systems which help in integrating all the functions from warehousing to distribution. removing the need of a consumer physically visiting the store. Rather than manually process a cheque. having digitally captured and stored the image of the cheque. while transponders are placed on moveable items. front and back office store systems and merchandising. which makes the process very fast. while servicing the customer better. Portable Data Capture systems: portable RFID systems that can be used anywhere. Networked systems: fixed position readers those are directly connected to centralized information management system. An integrated supply chain helps the retailer in maintaining his stocks. preventing stock-outs and thus reducing his costs. mail order and the Internet has provided retailers with real access to consumer data. Electronic cheque conversion. along with the various available CRM (Customer Relationship Management) Systems. the retailer voids it and hands it back to the consumer along with a receipt. getting his supplies on time.
monthly forecasting. They enable consolidation of activities such as long term budgeting. CRM MODEL .allows the retailers to study the purchase behavior of consumers in detail and grow the value of individual consumers to their businesses. weekly factory scheduling and daily distribution scheduling into one overall planning process using a single set of data. software packages are helping retailers not only in their locational decisions but in decisions regarding store sizing and floor-spaces as well. Today. A larger number of visual merchandising tools are available to him to evaluate the impact of his stacking options. 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. 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. These APS packages complement existing (but often limited) ERP packages. all the way from raw material supplier’s right through to the retail shelf. Advanced Planning and Scheduling Systems APS systems can provide improved control across the supply chain.
Using the Customer Relation Profile. If organization want an "easy to use tool" to realize how organization can maximize business relations. strong and wanted sides of the organizations. 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.The essence of this process is mutually to discover weak. this is the tool for organization and organization. in order to improve future relations. Customer Loyalty: .
but if price were the only thing driving loyalty we would all be frequenting garage sales and flea markets. bad customer service will result in brand and profitability erosion. Setting aside unique location or competitive differences. and eventually shop at the competition. and then being held hostage by the checkout process. stores with higher levels of customer loyalty should see higher same store sale increases year over year. 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. and checkout experience. Literature Review: . Without that help and support they become easily frustrated. friendliness and helpfulness of sales staff. There is nothing worse than having a great shopping experience. store cleanliness. price is an element we do not find to be a significant driver of loyalty. 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. It is not surprising that the personal interaction of store associates is a significant component of driving loyalty. These programs would teach what actions are necessary to improve low scores.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. we all face time and cost trade-offs. As busy consumers. customers still need to be guided into finding the right products. Even in today's self-service retailing environment. 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. Loyalty is most influenced by the shopping experience and the brand (the cumulative impact of many experiences over time). Not that pricing is inconsequential or immaterial to the consumer's choice of where to shop. Surprisingly. There are a lot of components to the shopping experience such as availability of parking. easily located products. Likewise.
Deeter-Schmelz.. Daniel J. 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. to identify the retailer's perceptions of the offering frequency and importance of the promotional support. 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. Moore.Several studies on CRM and apparel retail sector are reported in the context of developed markets. you need to sell maximum products over a long period of time and across different product lines. stated the need to demonstrate increased revenue. Kincade. The purpose of the study was to define promotional support categories offered to apparel retailers by manufacturers. 83 percent. Jesse N. Aspects studied include background on the symbolic aspects of consumption.. Dawn R. The implied. A positive and . prestige shopping behavior. (2000) examined Prestige clothing shopping by consumers by a confirmatory assessment and refinement of the PRECON scale. Park. Ginger A. of the companies actively implementing CRM.. and to investigate the relationship between offering frequency and perceptions of importance. Results indicated that monetary support was regarded as the most important promotional support. The paper concludes with managerial implications for the United States apparel retailers dealing in prestige clothing. A brief overview is presented below: According to Pine and Gilmore (1999) experiences can be described by two dimensions.. In the recent information Week survey. Haesun (2002) studied Buyer–seller relationships for promotional support in the apparel sector which is critical for success. Goebel.. The Second highest percentage. reassessment and refinement of the PRECON scale and impact of income and age on prestige shopping. The first dimension refers to the customer’s degree of active participation in the creation of the experience. Woodard.” Peppers and Rogers (1993) stated that to build the relationships with your individual customers. 93 percent claimed increased customer loyalty and customer Satisfaction would justify their CRM investment. Doris H.
fashionability. but the program did not prompt them to change their purchase behavior. Benavent. the loyalty program broadened their relationship with the firm into other business areas. (2007) found out the Long-Term Impact of Loyalty Programs on Consumer Purchase Behavior and Loyalty. In contrast. product assortment. payment options. Alejandro Molla. national brands and store layout. Lars. . Using longitudinal data from a convenience store franchise. Molly. Liu. 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. When all companies had loyalty programs. Hyllegard. Karen. and perceptions of the impact of foreign retailers on local communities. perceptions of retailers' products and services. The double jeopardy phenomenon was present and loyalty programmes did not substantially change market structures.significant correlation was found between items the buyers perceived as important and the frequency of offerings of these items. Borja. In the context of French market. Yuping. (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 . It found out that the perceptions differed regarding quality. convenience of location. consumers whose initial patronage levels were low or moderate gradually purchased more and became more loyal to the firm. studied Spanish consumers' perceptions of US apparel speciality retailers' products and services. household income. Thus there is a need to consider patronage to decide rewards for loyalty programmes. Christophe. extent and quality of customer service. The study examined consumers' store patronage and apparel purchase behaviour. Descals. For light buyers. the market was characterized by an absence of change of the competitive situation. acceptance of US apparel brands. norms and behaviour that influence consumer decision making and impact acceptance of products and services. Miguel Angel Gomez (2005). Meyer-Waarden. Eckman. The study emphasized that speciality retailers' success in international markets is contingent upon their knowledge of culturally-defined values. Consumers' acceptance of US apparel brands was a function of age. apparel product country of manufacture and price.
Pedro Reinares. Sweat. ”Spanish consumers' perceptions of US apparel speciality retailers' products and services “Journal of Consumer Behaviour.. Doris H. September 15.html 2. p48-52. Vol. Moore. New York:Doubleday. http://www. Winter2005 Issue 48. International Consumer Lifestyles Database(2005) 9. Don and Martha Rogers. 9p. Vol.”. 8. Ph. Ginger A.” Journal of Marketing. “Global Apparel.2000.” Journal of Marketing Management. Eckman. Feb2006. Sep2005. Benavent. MiguelAngel Gomez. 28p. Zeithaml. p43. p19-35. profitability.” Information Week via COMTEX online.scribd. Oct2007... Daniel J. 5.. Accessories and Luxury Goods” Datamonitor. Journal of the Academy of Marketing Science 28(1). Vol. Kincade. Vol. 67-85 11. Deeter-Schmelz. 6. Jeff. Vol. Peppers.indiamart. 5p. Haesun.” prestige clothing shopping by consumers: a confirmatory assessment and refinement of the precon scale with managerial implications”. 3. (2000).. p61-88. 4. Christophe. International Journal of Consumer Studies. Descals. and the economic worth of customers: Wwhat we know and what we need to learn. Liu. Journal of Marketing Theory & Practice. Borja. Hyllegard. Fall2000. “Consumer Lifestyles in India” Euromonitor. Dec2002. 22 Issue 1/2. Service quality..com/lib/textile/textile07301998. 7. Goebel.” Exploring the Benefits Obtained in a Loyalty Programme applied to Retailing. Lara. 71 Issue 4.References: 1. Karen. 12. p294-302. p345-362.” The Long-Term Impact of Loyalty Programs on Consumer Purchase Behavior and Loyalty.D. Jesse N..” European Retail Digest. Lars... 18p. 16p. Woodard.1993 13. 17p.com/doc/95637/Customer-Relationship-Management . Alejandro Molla. Dawn R. 7 charts. The one to one future: Building Relationships One Customer At a Time. Molly. Yuping. V. http://apparel. 4 Issue 5. 8 Issue 4. But progress can be very slow-CRM under scrutiny. Meyer-Waarden. Park. (2006) 10. 26 Issue 4. “Lots of companies are thinking about customer relationship management.” The Impact of Loyalty Programmes on Repeat Purchase Behaviour.A.
The two questionnaire were developed hypothesis were formulated to reflect the associations between the different Lifestyle Stores and the customer service offered by them. 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. The level of association as measured by Pearson’s co-efficient falls between -1. which indicates the strength and direction of association between the two variables. Structured questionnaires. To study the association between the Customer’s Services & the Customer Loyalty. T-test was applied in order to compare significant difference between the store attributes of different lifestyle store.RESEARCH DESIGN Research objectives The survey was conducted among the customers shopping in the mall. Use was made of Pearson’s coefficient to determine the level of association between the store attributes. the applications of IT. to measure the respondents’ perceptions and expectations. Use was made of a five-point Likert scale. identification. To study the perception of customers towards the CRM strategies implemented by the different Lifstyle Stores. were distributed to the people in a mall. A total of 200 questionnaires were distributed to the people. The measure was standardized through computation of reliability & validity. 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. The main body of the questionnaire included 11 questions reflecting customer service.0.0 and +1. interaction and customization. customer service & the customer loyalty. differentiation. . 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. To do the comparative analysis of different Lifestyle Stores on different store dimensions. 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.
The apparel industry exists in a very competitive environment where companies need to adopt new technologies in order to improve profitability and lower costs. and for the fashion-conscious consumer. the vast majority of people who are exposed to advertisements for certain products generally have aspirations of being able to own these products someday. 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. expansion of licenses into areas such as watches and sunglasses and a product mix toward accessories and gifts. 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. they provide sensible and affordable clothing whose styles will not change drastically from year to year. The brand’s recent revival was a result of several key strategic plans. flagship stores and presence in high-end department stores.The companies serve two types of consumers: for the practical consumer. 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. 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 demand for Apparels are affected by general economic trends . But every customer has a different perception Although a select few are able to afford luxury goods. 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. . For consumers Luxury means exclusivity. Key strategic initiatives included: “the muchvalued positioning as a lifestyle brand. The store focuses on accessibility while maintaining its exclusivity and protecting its tradition and heritage while striving to be innovative and inspiring.
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. luxury goods reinforce their status as a member of the upper class. luxury goods brands have been broadening their appeal to a wider consumer base. 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 allure for many designer products is people’s desire for wealth and status. To do the comparative analysis of different Lifestyle Stores on different store dimensions. The two questionnaire were developed hypothesis were formulated to reflect the associations between the different Lifestyle Stores and the customer service offered by them. RESEARCH DESIGN The study is exploratory in nature with survey method being used to complete the study. Both Exploratory & Causal Research Design were taken Research objectives: The survey was conducted among the customers shopping in the mall. the presence of competition. but for everyone else luxury goods are items that many aspire to be able to own someday.In the past three years. 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. To study the perception of customers towards the CRM strategies implemented by the different Lifstyle Stores. The main factors in such a study were customer demographics. To study the association between the Customer’s Services & the Customer Loyalty. An example of this would be the Consumer’s make a use of internet. For the wealthy. It is an idea of status and exclusivity that makes these brands sought-after by people from many different walks of life. which is ultimately the end product that is consumed. physical store .
identification.0. H2: Differentiating between the services offered to new and existing clients increases the level of customer service. quality. 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. . differentiation. were distributed to the people in a mall. A total of 200 questionnaires were distributed to the people. to measure the respondents’ perceptions and expectations. T-test was applied in order to compare significant difference between the store attributes of different lifestyle store. The main body of the questionnaire included 11 questions reflecting customer service. The measure was standardized through computation of reliability & validity. Use was made of a five-point Likert scale. customer service & the customer loyalty. The level of association as measured by Pearson’s co-efficient falls between -1. Discussion of the specific findings H1: Identifying new and existing clients increases the level of customer service.0 and +1.characteristics. Structured questionnaires. CRM technologies and the characteristics of Customer Service Representatives etc. 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. the applications of IT. which indicates the strength and direction of association between the two variables. Use was made of Pearson’s coefficient to determine the level of association between the store attributes. interaction and customization. sales promotions. 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.
5 25.0 Valid Business Service Student Total Frequency 63 87 50 200 Percent 31.0 .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 31.5 43.5 75.0 Valid Percent 31.5 43.0 100.0 100.0 100.5 25.
Results: • The service class people prefer to make the purchase of apparels monthly i.e.25% • • .e.i. 44%. The business class people prefer to make the purchase of apparels occasionally but sometimes monthly too.31% While a student prefer to make the purchase of apparels occasionally.i.e.
5 100.i.0 Valid Percent 19.5 34.34% . • People from income group of >30 K prefer to make the purchase of apparels occasionally.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. 31%.5 65.0 Results: • People from income group of 18-30 K prefer to make the purchase of apparels monthly i.5 15.0 31.e.5 100.0 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 19.0 34.e.0 34.0 31.5 15.5 100.
74 Male respondents have the loyalty cards of different lifestyle Stores.20%.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 Valid Percent 52.0 48.e.0 100.e.i.0 Results: • Out of 104.0 100.0 100. People from income group of 12-18 K prefer to make the purchase of apparels monthly.0 48.• People from income group of <12 K prefer to make the purchase of apparels occasionally i. .0 Total 30 27 57 104 96 200 Gender Total Male Female Valid Male Female Total Frequency 104 96 200 Percent 52.
69 Female respondents have the loyalty cards of different lifestyle Stores. . Finding: Females are prone to shopping that is why maximum females have loyalty cards.• Out of 96.
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