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Business strategy

Business strategy of

BIG BAZAAR, SHOPPERS STOP, PANTALOONS, LIFESTYLE

Submitted by: Group 6 Anshumali Anupriya Verma Vinay Rao Prashant. K Girish. P

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PANTALOON-BUSINESS STRATEGY INTRODUCTION


_ Pantaloon Retail (India) Limited is Indias largest leading retailers. It operates on

multiple platforms like Value and life style segment in the Indian consumers market. Company head quarters located in Mumbai. Company operates over 12 million square feet of retail space, 1000 stores in 71 cities with employee strength of 30,000 people. The company is in aspect of giving retailing a modern look with reachable for middle and middle lower class people. Retailing includes retail formats like Pantaloons, Big bazaar, Food bazaar, brand factory, Blue sky, and Top 10, Star & sitar and e zone. The company also operates on online future bazzar.com for upper class that can get internet connectivity.

LEADERSHIP AND HOLDING COMPANY BACKGROUND Pantaloon Retail is the flagship company of Future Group, a business group catering to the entire Indian consumption space. Future Group led by its founder and Group CEO, Mr. Kishore Biyani, is one of Indias leading business houses with multiple businesses spanning across the consumption space. While retail forms the core business activity of Future Group, group subsidiaries are present in
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http://www.scribd.com/doc/36606651/Fmcg-Companies-in-Rural-Markets consumer finance, capital, insurance, leisure and entertainment, brand

development, retail real estate development, retail media and logistics.

POSITIONING OF PANTALOONS Pantaloons are positioned as a departmental store catering to the middle and upper middle class sections of the society. Its core offering is branded merchandise, retailing international, national and regional brands as well as private labels. Pantaloons believe that they will be drivers of fashion. Thus the store focuses on providing value for money proposition as it provides quality products at affordable prices. Initially positioned as a family store, it finally veered towards becoming a fashion store with and emphasis on youths and clear focus on FRESH FASHION. They are targeting youth and even women, since they are the ones defining most purchasing decisions. PRODUCTS AND OFFERINGS Pantaloons have a wide range of brands in menswear, women wear and kids wear. Pantaloons have the best known national, international and regional brands apart from stocking its own private label. Some of the brands they stock include Ajile, Akkriti, Bare, Bare Denim, Bare Leisure, Chalk, Honey etc. BUSINESS STRATEGY

http://www.scribd.com/doc/36606651/Fmcg-Companies-in-Rural-Markets Diversification strategy The company started its business as textile manufactures but growth in modern organized retailing attracted the company to switch diversify to the next consumption pattern. The company diversified and acquired a large business in organic and inorganic way. But company did not forget ripe its strategy and values in the diversified company. In every new business company started to rewrite the rules by retaining values. The company in latter stage organized to support each other by physical material flow if required. Diversification is done in two main categories RETAIL FORMATS and SPECIALIZED BUSINESS.

Classes destination strategy Future group has diversified its business keeping the retiling as common goal. To set and concentrate on one stratum is main objective of this strategy. Each business is set to operate on defined strata. Company has divided Indian customers in three different groups. INDIA ONE, INDIA TWO, INDIA THREE. Each has different values, products and quality requirements. INDIA ONE or consuming class .The population of this constitutes only 14%.Till recent times the modern retiling formats is offered for this class. According Maslows theory of hierarchy the 14% people are in self actualization and Esteem needs in the pyramid. For this class pantaloon

http://www.scribd.com/doc/36606651/Fmcg-Companies-in-Rural-Markets patterned Future bazaar, E zone, Central, brand factory, Home town and star Galaxy entertainment. INDIA TWO or the serving class it includes people like house hold helpers, office peon etc. This is the people who make service INDIA ONE class. The population of this class is more than 30%. In the needs hierarchy they are located in for Social and security .Earning capacity of this class is 60% lesser than INDIA ONE. For this class as the big bazaar, Food bazaar, Future money and other retail formats are presented. INDIA THREE or struggling class. The class led life on hand to mouth existence. They cant afford for beater living style. This segment doesnt contribute much in the contribution cycle. The need of the segment is local as they are finding it cheaper. The present business model is not addressing this class. Figure 1 shows change in consumption patter by different class in 2001-02 and 2007-08.INDIA ONE has changed from 25% to 35% normally the total profit in this segment will comparatively 20% more than they are sold in next segment. As ambiance is factor and other pleasuring non value added services are necessary. INDIA TWO has not changed it conception level. INDIA THREE has seen 10 % decline.

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Maximum market shares strategy The retail chain by pantaloon in all business patterns tries to achieve maximum market share in all the products or service it provides .The Company does not bothers about short term profit or loss by a strategy. This are considered as learning. The business will sell at marginal profit some times to attract the new customer who will prove potential customers in future. The strategy achieved by focusing pricing factors in INDAI TWO and on service and quality in INDIA ONE.

Pricing strategies Pricing is strategy used by Pantaloon retail chain to attain maximum market shares. The company offers numerous schemes to attract the new customer as well as to retain the present customers. The companys schemes are categorized in following groups y Value pricing This approach is used where external factors such as recession or increased competition force companies to provide 'value' products and services to retain sales. The product value will be associated with external factors. y Promotional pricing

http://www.scribd.com/doc/36606651/Fmcg-Companies-in-Rural-Markets Pricing to promote a product is a very common application. The application of this done by BOGO (Buy one Get One), BTGO (Buy Two Get One Free) etc. y Bundling Bundling is marketing tool sell two or more complementary product as a package with attractive price. The price is will lesser then individual selling price. Example: A Person needs one soap for a period of time But bundling with attractive price with more than 3 soaps can attract them. y Low interest rate financing Future money helps in asset purchase at 0% interest. y Physiological discounting In India this approach is called as Bata rating system. Organization utilizes this approach when product has emotional value rather than rational value. Example a product is priced for 99 instead of 100.When board shows price reduction from 100 to 99, Consumer looks at 3 digits to 2 digits rather than exact value. y Time pricing The innovative way of attract the customer is Timely pricing it is known that during holidays rate of customer is more. Reduction of profit margin with lot of advertisement will invite new customers. The company has learnt it from strategy made on public holiday 26-Feb.

http://www.scribd.com/doc/36606651/Fmcg-Companies-in-Rural-Markets When the turnover of the day reached 30 cores where average is 5 cores. With such experience crowded management is essential so to divert potential customers Wednesday bazaar where it will offer less profit margin sales. The Right Joint Ventures at the Right Time In accordance with its experimentation policy Pantaloon has formed key joint ventures with a number of popular names like Staples and Starbucks. With its firstmover advantage, it actively shut doors for the competition by snapping up major brands before others could get to them. FUTURE OF PANTALOONS We believe that Pantaloons would continue to experiment, might push its private label hard. Private label is gaining popularity in India and Pantaloons with its superior brand image would reap rich dividends with its private label offering. CONCLUSION Pantaloon retail India evolved its business strategy based on understudying customers. The organization deploys the cultural and regional strategies to attract the customers. The changing emotions of customers are tracked and they are linked with the power of modern retailing environment. But still the company has introduce modern retailing malls to the social class people of India it has fear of threat of business decline from the competitors like Reliance fresh.

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ITC LIFESTYLE-ANALYSIS
COMPANY PROFILE

ITC Lifestyle Retailing Business Division made foray into the Rs. 200 billion ready to wear apparel industry with the launch of its Wills Sport range of internationally-styled premium relaxed wear for men & women in the year 2000. The companys first exclusive store Wills Lifestyle was opened in South Extension in Delhi in July 2000. The WLS chain of exclusive stores later expanded its range to include Wills Classic formal wear in 2002 and Wills Clublife evening wear in 2003. Later in
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http://www.scribd.com/doc/36606651/Fmcg-Companies-in-Rural-Markets 2006, WLS became the title partner of the premium fashion event India Fashion Week. This association has helped the brand grow stronger and also make the product portfolio richer. The lifestyle retailing business division also caters to the mid-segment market through its brands John Players and Miss Players.

PRODUCTS ON OFFER Wills Lifestyle, the fashion destination, offers a tempting choice of Wills Classic work wear, Wills Sport relaxed wear, Wills Clublife evening wear, fashion accessories and Essenza Di Wills an exclusive range of fine fragrances and bath & body care products and Fiama Di Wills - a range of premium shampoos and shower gels. POSITIONING AND VALUES OFFERED Elegance, sophistication and exclusivity sum up the core values of Wills Lifestyle. International premium quality and vitality are imageries that the brand evokes. Lifestyle provides a different shopping experience through world-class ambience, customer facilitation and clearly differentiated product presentation Life style positions itself as a sophisticated retailer who offers the best in class products and shopping experience to its target group-the upper strata of the society. Life style has positioned itself in the premium segment of the market and it has been successful in establishing a well entrenched customer base consisting of the upwardly mobile urban professionals.
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BUSINESS STRATEGIES

GOING THE WHOLE HOG-STRATEGIC TIEUPS Even as Wills Lifestyle was busy preparing itself to rule the premium segment,
many premium category players like Westside, United Colours of Benetton, Provogue, Madura Garments, ArvindMills, etc. entered the fray targeting the young and upwardly mobile urban consumers. ITC changed gears, and sought international advice in areas like people training, store designing, merchandising, and fashion trends to keep its loyal customer base intact. The company tied up with the US based Friedman group to train its people in selling skills thus converting more footfalls into sales. It has also tied up with the London-based Elemental Design on visual merchandising to make in-store product presentation more attractive. The company also collaborated with the Italian design studios Alessandra Macchi Studio for flat knits and Ricardo Rami Studio for fashion wear for women. Recently, it has roped in FRCH, a LasVegas-based architectural, planning and interior design services firm, to get a new-look. Since then, there has been a 20 percent increase in footfalls across its stores and 15-20 percent rise in productivity.

INNOVATIVE MEDIA MIX


Most of the marketing strategy for the brands revolves around its flagship event association with the fashion week, as it gives it a clear chance to promote its flagship Signature collection in a big way. Besides, the chain does extensive promos through mass media advertising like magazines, newspapers, etc. In the light of the slowdown, its channeling its marketing spend more towards BTL initiatives like activation, loyalty leveraging and promo. BTL spends are expected to go over 60 percent of the total spends. The company spends roughly 12 percent of its turnover on advertising and marketing, and is also looking at Face Book and YouTube to attract the youth, through personalized marketing.

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A RAMPS-TO-RACKS PRESENCE-BRAND MANAGEMENT


After creating its retail presence and establishing premium brand imagery, the brand needed something to keep itself up-to-the-minute to get to the next level. And being a premium brand, it found an easy-fit with India Fashion Week, a bi-annual event title-sponsored by Wills Lifestyle for some years now. Company emphasises that there's a perfect synergy between its brands and the fashion week. The whole idea is to take designer wears from the ramp to the rack, making sure that the designer wear is glamorous, aspirational and at the same time accessible and affordable. The fashion week provides a great opportunity to create global benchmarks and has worked very well For its regular wear range, it has an in-house talent pool of 30 fashion designers, who are clued on to the latest fashion trends across the world. That apart, to ensure future supply of talent and to promote fashion further, it has tied up with leading fashion institutes like NIFT, NID and Pearl Academy to help budding designers showcase their talent, with an eye on building future capacity and the capability of the fashion industry. FUTURE PROSPECTS The lifestyle retail group believes that in hotel retailing and franchising is the way forward. Wills Lifestyle will also open boutique stores across the group's hotels. A 1,500 sqft boutique is already operational at the ITC Maurya in New Delhi, and soon Chennai and Bangalore hotels will too have them. Currently lifestyle has no plans to go global rather its future strategy is hinged on the great Indian boom. CONCLUSION Lifestyle has carved a niche for itself in the high end retail segment. The main reason for its success is the synergy and the capitalization of ITCs powerful brand name. The major learning outcome from this analysis is that a group like ITC which has strong brand image can diversify and be successful thanks to customer patronage and forceful strategies.

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