Problems Identified

1. High Competiton

Competition in business refers to the struggle or rivalry between the organizations

that provide comparable goods , services which also targeting the same customer base in an
effort to outperform competitors in terms of sales, revenue and market share (Pahwa,
2022). Base on the baby products existing there are many sole ownership competitors who
has strong brand marketing and product service globally. Initially, Baby Dreams’ first branch
was located at Jalan Persiaran Tanjung, Taman Cempaka, Johor Bahru. Then, with the help
of her father, she launched the second branch at Jalan Skudai lama, Tampoi. After observing
a good response from the market, she launched the third outlet at Jalan Wang Ah Fooq,
Johor Bahru. However, after several years operating her first two outlets, she had to close
them due to the stiff competition. High Number of competitors and strong competitors will
pull down individual companies market share which significantly will also decrease available
customer base as there are too many competitors.

Base on the case study, competitors of Baby Dreams could be divided into two
categories which are the corporate companies and sole ownership (individual company).
Corporate companies consist of the multinational companies such as Mothercase and
Johnson’s, and local companies consist of Carrie, Anakku, Pureen and Fiffy. The sole
ownership company consists of Pasarayaku, Honey Bee, Damia and Baby Dreams. These
companies are said to be her competitors because most of them operate in supermarkets,
hypermarkets and shopping malls which have easy access compared to her branch which
are located as standalone stores which may not attract customers to shop as there are no
other facilities or services available around as most would like to shop in malls,
supermarkets or hypermarket where many things can be occupied.

2. Customer or Demographic Classification or Distribution

Customer segmentation or market segmentation is often referred to dividing

customers into subgroups to make it easier for the company to target the group based on
the needs more effectively. For Baby Dreams initially their focus is to attract more low
incomed customers with implementing low price strategy which is not suitable for since
there are many category customers with different household incomes as well as different
level of buying power. Customers buying power sometimes not only determined by lower
price strategy but also considering on the quality of product or services which they prefer to
engage on. Therefore , underestimating customer buying power and only focusing on giving
lower price will attract customer will not sustain Nora’s business for long term. Moreover,
considering success from one outlet with customers demand is not a good strategy for Nora
to consider opening another outlet but there are many other aspects to be considered when
deciding to open another standalone stores.

Besides that, demographic aspects also is not considered as Nora only depends and
evaluate success with customers response and buying power. Opening two other outlet
cause her loss as she did not consider a strategic location which can attract customers, or
maybe access to her outlet is not convenient. This also can be to the demographic area is
not occupied with residents where limited access to her store. Moreover soe places can be
rural and not strategic to reach out to customers, not friendly and can be over crowded with
competitors as well. As mentioned above, many aspects to be considered in opening one
store compared to looking at customers response from one outlet only. Considering
strategic location can help to gain customers attention to visit your Nora’s outlet.

3. Poor Marketing Strategy or Plans

Lastly, a good marketing strategy is crucial to any business or organization in

sustaining their brands, outlets, and services in these highly competitive market. It assists in
enhancing awareness and provides additional information about the company’s product or
services which can strongly give information to customers and attract them to shop. Looking
at this case study, Nora has failed to identify proper marketing channel or maybe did not
give much importance in providing good information or promoting their products, outlets or
services in the market which failed to reach out to customers. There are no effective
marketing strategies set by Nora for short or long term in gaining customers loyalty
moreover with many competitors providing same products and services in the market.
Setting good marketing strategy term by term will not lead Nora to close her outlets. Poor
exposure and understanding of the market contributed failure to Nora’s daily operation.

In this case study, we understand that Nora is facing challenges with the pricing
strategy which led to poor sales while focusing on low and middle -incomed group. However
besides understanding the market channel where there are many aspects that she can
improve on to sustain her business in the market focusing on proper targeted market.
Firstly, Nora would have to need understand and identify their company pricing position ,
segment and capability in attracting customers in the market, as all companies has different
pricing strategy and when comes to competitor for baby products most companies sells
almost the same products and sub brands. Therefore each companies pricing strategies and
tactics vary from company to company, countries to countries, cultures , industries and the
influential of surrounding economic and household income. Nora will need to do
competitors price research base on location and products.

Secondly, Nora will need to determine type of customers shops in her outlet as there
are high income, medium and low income customers involved. Understanding the
demographic and customers factor plays a huge part in deciding the price that she will need
to set base on where her outlets are located. For example, one of her outlet is located near
to Singapore borders where attracting many foreign customers, she will need to set a high
range of price as the cost involved in her operation there should be slight high , customers
has high bargaining and buying power compared to other locations in Johor Bahru where
she can focus on lower price strategy. Gaining the advantage of having outlet near to
Singapore border she can set a high price and varieties of baby products and brands which
are available in the market to attract customers to shop in her outlet. Nora’s low- price
strategy will need to consider all the cost of shipment, logistics, salaries, management,
brands and market demand as well and in this case it is not suitable as focusing only on low
and middle incomed groups which will not only have lower demand, buying power and
sales. Lowering price and giving short term discount is suitable for short term strategies to
attract customers to chop while babies necessities are always on demand therefore proper
setting of price base on her location, demographic and channelled customers are important.
Her strongest point is that one of her outlet focuses on Singapore or foreign customers,
therefore proper price setting, varieties of products and services will set high income to her.

Thirdly, is the high competition in this business line as there are many other
companies are promoting same products , brands while operating in in supermarkets,
shopping malls which has more easy access to customers compared to her outlets are
located individually in selected locations. Understanding and market research strategies
used by sole ownership companies like Honey Bee, Pasarayaku in marketing and attracting
customers to shop with them. Despite owning own outlet, Nora will need to think on
competitors strategies in marketing their products, price placing strategies in attracting
customers to shop with them on these selected outlets or malls. Moreover, to be better
than competitors customers will mostly focus on the customer service provided by any
companies, therefore Nora can strategies and analyse their customer service segment if it is
recommendable and gives pleasant shopping experience to customers. Customer focus will
always be main priority for many companies and competitors in attracting customers to
their outlets despite if the price is comparably high in the market as this touches customers
sentiment and gives great hospitality to customers. Significantly, looking after existing
customers by improving customer service by giving more importance to customer needs,
expectation and pleasant shopping experience is highly recommendable in attracting new
customers to shop and existing customers to stay loyal.

Last but not least, marketing strategies in giving information to customers and
attracting them to shop. Marketing is not only involving giving vouchers, all time low price
guarantee tagline but also on how we can provide good and valuable information to
customers in purchasing any of the brands or products that Nora’s business are focusing in.
More advertisement, banners, information on babies health issue and the type of products
which is beneficial for babies use is important in attracting parents to shop for their babies.
Effective marketing involves, short and long term strategies in attracting customers
therefore Nora and her team will need to strategies proper marketing strategies involving
products, price, demographic and economic aspects in attracting customers. Focusing on
the business strength and weaknesses as benchmark to set a strategy to attract customers,
improve good sales and expending business in important for Nora to sustain in the highly
competitive baby product market.