SWAYAM SIDDHI COLLEGE OF MANAGEMENT & RESEARCH
A PROJECT REPORT ON STUDY ON CONSUMER SALES PROMOTIONS OF APPAREL RETAIL STORES
SUBMITTED BY: PARINAY SHASHIKANT MATKAR MMS BATCH 2008-2010 (MARKETING)
UNDER THE GUIDANCE OF
PROF. TUSHAR CHAKRAVARTY
IN THE PARTIAL FULFILLMENT OF MASTERS OF MANAGEMENT STUDIES (MMS) OF
UNIVERSITY OF MUMBAI
[Approved by AICTE, Affiliated to University of Mumbai & Govt. of Maharashtra DTE Code – MB 336] (An ISO 9001-2000 Certified Institute) Sonadevi Weight Bridge, Near Octroi Naka, Kalyan Road, Temghar, Bhiwandi, Dist. Thane – 421 302
CERTIFICATE This is to certify that Mr. PARINAY SHASHIKANT MATKAR (Roll No.1328) No.1328) student of Second Second Year Master of Manageme Management nt Studies Studies (MMS (MMS/M /MBA BA)) of SWAY SWAYAM AM SIDD SIDDHI HI COLL COLLEG EGE E OF MANA MANAGE GEME MENT NT & RESEARCH has successfully completed the winter project work titled “STUDY STUDY ON CONS CONSUM UMER ER SALES SALES PROMO PROMOTIO TIONS NS OF APPARE APPAREL L RETAIL STORES” STORES” in partial fulfilment for the degree of Master of Management Studies of University of Mumbai.
Date:
/ /2010
Signature of the project guide
Prof. Tushar Chakravarty
Director
Dr. Nilesh Chatterjee
Declaration I, Mr. Parinay Shashikant Matkar, hereby declare that the project report titled “Study on consumer sales promotions of apparel retail stores ” is the record of authentic work carried out by me during the academic year 2008 – 2010 and has not submitted to any other university or institution towards the award of any degree.
Date: / /2010
______________________ ______________________ Signature (Parinay S. Mtakar)
Acknowledgement I, Mr. Parina Parinay y Shashi Shashikan kantt Matkar Matkar (Swaya (Swayam m Siddhi Siddhi Colleg Collegee of Manage Managemen mentt and Research, Bhiwandi), would like to thank my project guide, Prof. Tushar Chakravarty for his valuable guidance and support which has helped me immensely in completing this project. I also want to thank the college director Mr. Nilesh Chatterjee and other professors, my friends and colleagues, who have directly or indirectly helped me out in the completion of my project. Lastly, I would like to thank the entire staff of all the stores for their cooperation during my project work.
INDEX
Title
Page no.
Introduction to retailing
1
Apparel Retail Industry
3
Major players in Apparel Retail
6
Sales Promotion
8
Objectives
11
Research Methodology
12
Analysis
15
Findings
41
Conclusion
43
Bibliography
44
Executive Summary In a market like India, there is a constant clash between challenges and opportunities but chances favour those companies that are trying to establish themselves. To sustain in such a volatile market, companies have to bring innovative solutions. With the advent of modern format retailers and the growth of plastic cards, affluent urban Indians are shopping like never before. As apparel retail is led by fashion, a retailer needs to keep a close watch on fashion amongs amongstt teenag teenagers ers,, as they they are the trend trend setter setters. s. Season Seasonal al variat variation ionss on stocki stocking ng pattern and need to clear inventory at the end of season should be understood by appare apparell retaile retailer. r. This This highli highlight ghtss the import importanc ancee of sales sales promot promotion ionss- short short term activities which induces trade or consumer to buy now, rather than in future, as the value of apparel after the season goes down substantially and inventory carrying burden turns out to be very high. Apparel retailer needs to understand critical role of sales promotions. The topic of the project is to perform a study on consumer sales promotion activities of the apparel retail stores in Mumbai. To accomplish the above, three apparel retail stores stores of differe different nt well well known known busine business ss groups groups,, locate located d in Mulund Mulund (W) area of Mumbai were surveyed and interviewed. The responses were analyzed and results were obtained. The core purpose of the survey was to study the sales promotion activities performed by apparel retail outlets which results in stimulating product interest, trial, purchase and stock clearance.
Introduction to retailing
The revolution in retailing industry has brought many changes and also opened door for many Indian as well as foreign players. players. In a market market like India, India, there is a constant constant clash between challenges and opportunities but chances favour those companies that are trying to establish themselves. Thus, to sustain in a market like India, companies have to bring innovative solutions. Indian market has potential to accommodate many retail players, because still a small proportion of the pie is organized. Retailing is still in its infancy in India. In the name of retailing, the unorganised retailing has dominated the Indian landscape so far. According to an estimate, the unorga unorganiz nized ed retail retail sector sector has 97% presen presence ce whereas whereas the organi organized zed account accountss for merely 3%. Industry has already predicted a trillion dollar market in retail sector in India by 2010. However, the retail industry in India is undergoing a major shake-up as the country is witnessing a retail revolution. The old traditional formats are slowly changing into more complex and bigger formats. Malls and mega malls are coming up in almost all the places, be it metros or the smaller cities, across the length and breadth of the country.
A McKins McKinsey ey report report on India India (2004) (2004) says says organi organized zed retaili retailing ng would would increas increasee the efficiency and productivity of entire gamut of economic activities, and would help in achieving higher GDP growth. At 6%, the share of employment of retail in India is low, even when compared to Brazil (14%), and Poland (12%). Govt of India’s plan of changi changing ng the FDI guidel guideline iness in this this sector sector speaks speaks of the import importanc ancee attach attached ed to retailing. retailing. Recent moves by big corporate houses like Reliance Reliance Industries Industries has further further fuelled the major investments in retail sector. A strategic alliance, land acquisitions in prime areas give the essence of the mood in this sector. Both MNCs and Indian firms want to get their share of this burgeoning pie. Notable in Indian firms are Pantaloons Retail & Big Bazaar, Trent’s Westside, Shopper’s stop, Reliance, Subhiskha, Wills Lifest Lifestyle yle stores stores,, Cafe Cafe Coffee Coffee Day, Day, which which are presen presentt in India India in differe different nt retail retail formats. Wal-Mart stores have just started operations in India. Some leading retail coffee chains of the world like Starbucks, Starbucks, Barnies are planning planning to expand expand in a major way in India.
The Indian retail sector
India is the country having the most unorganized retail market. Traditionally it was a family’s livelihood, with their shop in the front and house at the back, while they run the retail business. More than 99% retailer’s function in less than 500 square feet of shopping space. The Indian retail sector is estimated at around Rs 900,000 crore, of which the organized sector accounts for a mere 3 per cent indicating a huge potential market opportunity that is lying in the waiting for the consumer-savvy organized retai retailer ler.. Purc Purcha hasi sing ng powe powerr of Indi Indian an urba urban n cons consum umer er is grow growin ing g and and bran brande ded d merchandise merchandise in categories categories like Apparels, Apparels, Cosmetics, Cosmetics, Shoes, Watches, Watches, Beverages, Beverages, Food and even Jewellery, are slowly becoming lifestyle products that are widely accepted by the urban Indian consumer. Indian retailers need to take advantage of this growth and aiming to grow, diversify and introduce new formats has to pay more attention to the brand building process. The emphasis here is on retail as a brand rather rather than than retaile retailers rs sellin selling g brands brands.. The focus focus should should be on brandi branding ng the retail business itself. There is no doubt that the Indian retail scene is booming. A number of large corporate houses —Tata’s, Raheja’s, Piramals’s, Piramals’s, Goenka’s Goenka’s — have already made their foray into this arena, with beauty and health stores, supermarkets, selfservice music stores, new age book stores, every-day-low-price stores, computers and peripherals peripherals stores, office equipment stores and home/buil home/building ding constructio construction n stores. stores. Today the organized players have attacked every retail category.
Apparel retail industry
In India, clothing retail accounts for 36% of organised retail business. It is the largest sector. Ready-made apparel accounted for an estimated 20% of domestic clothing sales in 2005. With growing working women wearing western wear to work, and pressed for time, market for good readymade clothes is likely to grow. India is a filmcrazy nation, and the largest producer of films, with more than 1,000 every year. They provide entertainment and an escape from reality for India’s masses, and set the popular fashion trend. Bollywood fashions have become pan Indian. They affect various sectors of the market including clothing, footwear, weddings and fashion accessories. With the advent of modern format retailers and the growth of plastic cards, affluent urban Indian women are shopping like never before. They spend mornings browsing in stores looking for deals or latest styles. Upper income urban women are adopting ethnic wears. These are designer clothes that incorporate Indian motifs, ethnic fabrics and are a fusion of western and Indian styles. In the large large urban urban centres centres,, apparel apparel retaile retailers, rs, like like Shoppe Shoppers rs Stop, Stop, Westsi Westside de and Pantaloon have popularised their private labels, which have attracted urban shoppers. Westside carries only its own private labels, while for the other stores, 20-30% of their apparel turnover is from private labels. Customers have loyalty to a store rather than any particular garment brand. This has led to a thriving unbranded or local brand market for ready-to-wear ready-to-wear clothes leading to severe competition. competition. Hence organized organized retailer retailerss like like Lifest Lifestyle yle,, for instan instance, ce, has a loyalt loyalty y progra programme mme called called `The `The Inner Inner Circle', while Pantaloons offers a `Green Card' Rewards programmes, Westside has `Club West' to woo the customers. Customers look to design and fit of the clothes, and use the shop’s name as a quality standard. Characteristics Characteristics of Apparel retail sector
As apparel retail is led by fashion, a player needs to keep a close watch on fashion amongst teenagers as they are the trend setters. Role of Bollywood in spreading fashion needs to be understood. Seasonal variations on stocking pattern and need to clear clear inve invent ntor ory y at the the end end of seas season on shou should ld be unde unders rsto tood od by appa appare rell reta retail iler. er. Typically once an item is sold from the outlet, retailer ensures that there is no repetition of same. It gets replaced by different design, style and colour. Importance of store layout, décor is very critical. A person 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. 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. This This highli highlight ghtss the import importanc ancee of sales sales promot promotion ionss- short short term term activi activities ties which which induces trade or consumer to buy now rather than in future as the value of apparel after the season goes down substantially and inventory carrying burden turns out to be very high. Apparel retailer needs to understand critical role of sales promotions. Attractive promotions induces purchase acceleration, stock piling and brand switching on the the part part of a cons consum umer er whic which h subs substa tant ntia iall lly y redu reduces ces retai retailer lers’ s’ fina financ ncia iall and and inventory risk and consumers’ financial risk and psychological risk.
Seasons of Retailing
Summer Season •
It is usually from May to July.
•
Low sales are recorded during this period.
•
This This season season is good good for promot promotion ionss and launch launching ing new adverti advertisem sement ent
campaigns. Fall Season •
August and September are important months.
•
Retailers are provided a good opportunity to increase their share.
Holiday Season •
It begins usually at the end of October and carries through the fourth
quarter ending in January. •
Festivals Festivals like Dusherra, Dusherra, Diwali, Christmas Christmas and New Year Eve bring more
customers. •
Usually it is the best time for retailers.
Spring Season •
It lasts from February to May
•
Fewer footfalls are recorded in malls.
Customers Men •
While men tend to prioritize fashion to a lesser degree than women, “right-
look” and the “descent” image is still important to them. •
Men tend to spend more money on electronic gadgets, food, sports goods
and music. Women •
“Teen” girls represent a lucrative opportunity for retailers. They are going to
become the future buyers. •
“Teen” girls are more trend savvy. It is not just the clothes and accessories, but
the whole look that the teen girls aspire to define. •
Wome Women n spen spend d more more on jewe jewell ller ery y and and hous househ ehol old d item itemss and and thus thus they they
contribute a lot more in terms of revenue.
Major Players in apparel retail
Shopper’s Stop
K. Raheja group of companies founded Shoppers' Stop on October 27, 1991.The organization had already made its presence felt in the hospitality and real estate sector, and now it has created a landmark in the Retail sector with Shoppers' Stop. Shoppers' Stop is famous for the expertise and acumen relating to the current practices of the industry. industry. It provides provides quality services, services, products products and the right kind of shopping shopping environment environment.. It has developed developed itself as a household name and has set high standards standards for itself with the mission statement: “Nothing but the best". In 2005, the company had 25 stores with a turnover of Rs. 1000 crores and 7 lakh sq. feet retail space in the year 2005. The average age of the employees in the organization is 25 years.
Pantaloon Retail (I) Ltd.
Pantaloon Retail is the flagship enterprise of the Future Group. Pantaloon Retail (India) Limited has spread across various businesses and cities in India. Pantaloon owns multiple multiple retail formats and is able to cater to a large section section of the society. society. The company has over 140 stores across 32 cities in India and 14000 employees. The organization made an incursion into the modern retail (fashion) in 1997. Big Bazaar, a hype hyperm rmar arke kett chain chain,, was was intr introd oduc uced ed in the the year year 2001 2001,, with with an Indi Indian an touc touch h of convenience and hygiene. Food Bazaar, food and grocery chain, and Central Mall located at various Metros are other important parts of the group.
Westside
Tata Group founded Trent Ltd. (Westside) in 1998. The acquisition of a London based retail chain Littlewoods by the Tatas was followed by the establishment of Trent
Ltd,
which
was
later
renamed
as
Westside.
It is one of the largest and fastest growing chains serving the customers in various categories, including men's wear, women's wear, kid's wear, footwear, cosmetics, perfu perfumes mes and handba handbags, gs, househ household old access accessori ories, es, linger lingerie ie and gifts. gifts. The The compan company y offers offers produc products ts with with a balanc balancee betwee between n style style and price. There are 25 Westsi Westside de departmental stores operating in various cities like Mumbai, Hyderabad, Pune, Delhi, Banglore, Noida, Gurgaon, Nagpur, Kolkata and many others.
Lifestyle International Pvt. Ltd.
Lifestyle is an international fashion store of the Landmark Group, a Dubai-based company. Lifestyle created a revolution in the Indian Retail Industry by bringing a truly international shopping experience. It was launched in Chennai, and now it is one of the largest professional retailers spread across 3,25,000 sq. ft. in various cities such as Chennai, Gurgaon, Mumbai, Hyderabad and Banglore. It is a heaven for shoppers with a vibrant and spicy lifestyle. It provides a wide choice of products at affordable prices with a convenient world-class environment and a friendly layout. Being one of the best shopping destinations, it has won the ''Most Respected Company in the Indian Retail Sector' and the 'Most Admired Large Format Retail Company' awards in India.
Globus
Globus was launched in 1998 as a part of the Rajan Raheja Group. The company opened its first outlet in Indore followed by two more in Chennai. The flagship store was opened on 1st November 2001 in Mumbai, followed by a vibrant store in New Delhi. Delhi. Subseq Subsequen uently tly,, its stores stores were were launch launched ed in Bangal Bangalore ore,, Ghaziab Ghaziabad, ad, Kanpur Kanpur,, Ahmedabad,
Noida,
Lucknow,
Varanasi
and
Hyderabad.
The organization has an innovative and adaptive environment. Globus has achieved custom customer er deligh delightt by presen presentin ting g value value produc products ts and servic services es throug through h contin continuou uouss improvement.
Wills Lifestyle
ITC has made a presence in the Retail sector through its exclusive specialty store 'Wills Lifestyle'. It has developed itself as a fashion destination offering a range of apparels and accessories. Top designers of the industry design these clothes. The store offers Wills Classic work wear, Wills Sport relaxed wear, fashion accessories and bath & body care products. Wills Lifestyle has also developed John Players as a brand that offers a fine collection of clothes for dynamic and vibrant people. ITC believes in the philosophy of enjoying the changing environment. This season Wills Lifestyle has brought a complete array of products for very aspect and mood of life be it work, relaxati relaxation on or party. party. The store store offers offers a truly truly 'Inter 'Internat nation ional al Shoppi Shopping ng Experi Experienc ence' e' through world-class environment and a robust r obust portfolio of offerings.
Sales Promotion
Sales promotions are short-term incentives to encourage the purchase or sale of a product or service. Sales promotion includes several communications activities that attempt to provide added value or incentives to consumers, wholesalers, retailers, or other organizational customers to stimulate immediate sales. These efforts can attempt to stimulate product interes interest, t, trial, trial, or purcha purchase. se. Exampl Examples es of devices devices used used in sales sales promot promotion ion includ includee coupons, samples, premiums, point-of-purchase (POP) displays, contests, rebates, and sweepstakes
Sales Promotion Strategies There are three types of sales promotion strategies: Push, Pull , or a
combination
of
the two. A push strategy involves convincing trade intermediary channel members to "push" the product through the distribution channels to the ultimate consumer via promotions and personal selling efforts. The company promotes the product through a reseller who in turn promotes it to yet another reseller or the final consumer. Trade-promotion objectives are to persuade retailers or wholesalers to carry a brand, give a brand shelf space, promote a brand in advertising, and/or push a brand to final consumers. Typical tactics employed in push strategy are: allowances, buy-back guarantees, free trials, contests, specialty advertising items, discounts, displays, and premiums.
A pull strategy attempts to get consumers to "pull" the product from the manufacturer through the marketing channel. The company focuses its marketing communications efforts on consumers in the hope that it stimulates interest and demand for the product at the end-user level. This strategy is often employed if distributors are reluctant to
carry a product because it gets as many consumers as possible to go to retail outlets and request the product, thus pulling it through the channel. Consumer-promotion objectives are to entice consumers to try a new product, attract customers away from compet competitor itors’ s’ produ products cts,, get consum consumers ers to "load "load up" on a mature mature produc product, t, hold hold & reward loyal customers, customers, and build consumer consumer relationship relationships. s. Typical Typical tactics tactics employed employed in pull pull stra strate tegy gy are: are: samp sample les, s, coup coupon ons, s, cash cash refu refund ndss and and reba rebate tes, s, prem premiu iums ms,, advertising advertising specialties, specialties, loyalty loyalty programs/p programs/patron atronage age rewards, rewards, contests, contests, sweepstakes sweepstakes,, games, and point-of-purchase (POP) displays. Reasons for Sales Promotions •
This could be a way of monitoring the performance of product management.
Since sales promotion can possibly provide immediate impact on consumer sales, it is not unusual to use these strategies to attain their sales objectives. •
Compan Companies ies have have to cope cope with with pressu pressure re on sales sales margin marginss which which they they can
achieve achieve through through paying closer attention attention to cost-effectiv cost-effectivee sales volume. volume. Since the results of using sales promotional techniques can be determined accurately, sales volumes can be easily predicted. •
More importantly, sales promotions are not only effective in attaining short-
term term sales sales;; they they are also also more more cost cost-e -effe ffect ctiv ivee comp compar ared ed to othe otherr inte integr grat ated ed mark market etin ing g
comm commun unic icat atio ions ns
tool toolss
such such
as
adve advert rtis isin ing. g.
The The
prog progre ress ssiv ivee
fragmen fragmentati tation on of audien audiences ces and the increa increase se in media media costs costs have have tipped tipped the balance in favor of sales promotion techniques which are more likely to deliver demonstrable results. Popularity of Sales Promotions
The reason sales promotions are gaining popularity is due to the fact that product and sales management are very confident in their ability to handle the techniques of sales promotion promotion.. Other forms of integrated integrated marketing communication communication tools need to go through a lot of thought and internal debates before funds are allocated or decisions are arrived at.
Product managers also are more in control of the determination and implementation of sales sales promot promotion ional al activi activities ties.. They They have have a freehan freehand d when when it comes comes to what what sales sales strategies to use. The importance of sales promotions as an integrated marketing communications tool could be attributed to the increase in number of specialist sales promotions agencies operating in certain places. In the past, sales promotion was viewed as part of other marketing communications techniques. Today, it is one of the stand-alone effective marketing tools. Disadvantages of Sales Promotions •
On the downs downside ide,, the sales sales promot promotion ions, s, unlike unlike other other integr integrated ated market marketing ing
communication tools, work often on a short-term basis only. •
Unlike advertising or public relations, for instance, sales promotions strategies
may have no lasting impact on the brand.
.. .
Objectives of the project To study study the sales sales promot promotion ion activit activities ies conduc conducted ted by the selecte selected d three three modern modern apparel retail outlets in Mumbai, namely Pantaloon Retail (I) Ltd., Westside and Shopper’s stop.
Sub-Objectives
To study the current scenario of the retail industry in India
To study the current scenario of the apparel industry in India
To understand the importance of sales promotion activities
To study and analyse the sales promotion activities conducted by the selected three apparel retail outlets in Mumbai
Research Methodology 1. Type Type of of Res Resea earc rch h Research is an original contribution to the existing stock of knowledge making for its advanc advanceme ement. nt. This This researc research h is an amalga amalgamati mation on of both both formul formulari arize ze as well as descriptive research.
2. Rese Resear arch ch appro approac ache hess There are two basic approached to research, quantitative approach and the qualitative approach. The former involves the generation of data in quantitative form, which can be subjected to rigorous quantitative analysis in a formal and rigid manner. This approach is further sub-divided into inferential approach is to form a database from which to infer characteristics or relationship of a population. This usually means survey survey resear research ch where where a sample sample of popula populatio tion n is studie studied d using using questi questionn onnair airee to determine its characteristics and it is then inferred that the population has the same characteristics.
Qualitative approach to research is concerned with subjective assessment of attitudes, opinions and behaviour. Research in such a situation is a function of researcher’s insight and impressions. Such an approach to research generates results either in nonquantitative form or in the form, which are no subjected to rigorous quantitative analysis.
Qualitative approach was been adopted in this study where data was collected by personally interviewing the staff of the selected stores.
3. Sour Source cess of Data Data The first part of the project was to study the current trends and the future of retail and apparel industry in India and also to gain some basic knowledge on sales promotion. This consisted of doing a secondary research about the industry with the help of some text books and also through the internet.
Once the secondary research was done, a personal visit was conducted to the three well known known appare apparell retail retail outlet outletss in Mumbai Mumbai namely namely,, Pantal Pantaloon oon Retail Retail (I) Ltd., Ltd., Westside and Shopper’s stop all of which are located in Mulund (W). The sales promo promotio tion n activit activities ies conduc conducted ted in the stores stores were were minute minutely ly observ observed. ed. Person Personal al interviews with few of the staffs of each store were conducted to gain the in-depth knowledge about the seasonal and non-seasonal sales promotion activities conducted by the stores.
4. Samp Sampli ling ng Pla Plan: n: (1) Population and Sampling unit
The sample unit is the individual unit of the selected sample. Here the sample unit were the apparel retail outlets in Mumbai.
(2) Sample Size
This refers to the number of items selected from the universe to constitute the sample. For the purpose of this study, a sample size of three apparel retail outlets were selected, all of which are owned by the three different well known business groups.
(3) Sampling Procedure
There There are variou variouss sampli sampling ng proced procedure uress for selecti selecting ng the sample sample proced procedure ures. s. The sampling procedure followed here is Simple random sampling.
ANALYSIS
Pantaloon Retail (India) Limited, is India’s leading retailer that operates multiple retail formats in both the value and lifestyle segment of the Indian consumer market. Headquartered in Mumbai (Bombay), the company operates over 12 million square feet of retail space, has over 1000 stores across 71 cities in India and employs over 30,000 people. The company’s leading formats include Pantaloons, a chain of fashion outlets, Big Bazaar, a uniquely Indian hypermarket chain, Food Bazaar, a supermarket chain, blends the look, touch and feel of Indian
bazaars
with aspects of modern retail
like choice, convenience and quality and Central, a chain of seamless destination malls. Some of its other formats include Brand Factory, Blue Sky, aLL, Top 10 and Star and Sitara. The company also operates an online portal, futurebazaar.com- a subsidiary company, Home Solutions Retail (India) Limited, operates Home Town, a large-format large-format home solutions solutions store, Collection i, selling selling home furniture products and eZone, focused on catering to the consumer electronics segment. Pantaloon Retail was recen recentl tly y award awarded ed the the Inte Intern rnat atio ional nal Retai Retaile lerr of the the Year Year 2007 2007 by the the US-b US-bas ased ed National Retail Federation (NRF) and the Emerging Market Retailer of the Year 2007 at the World Retail Congress held in Barcelona. Pantaloon Retail is the flagship company of Future Group, a business group catering to the entire Indian consumption space.
Future Group manifesto
“Future” – the word which signifies optimism, growth, achievement, strength, beauty, rewards and perfection. Future encourages group to explore areas yet unexplored, write rules yet unwritten; create new opportunities and new successes. To strive for a glorious future brings group’s strength, ability to learn, unlearn and re-learn ability to evolve. The Future Group will not wait for the Future to unfold itself but create future scenarios in the consumer space and facilitate consumption because consumption is development. Thereby, the future groups will effect socio-economic development for the customers, employees, shareholders, associates and partners. The customers will
not just get what they need, but also get them where, how and when they need. Future Group will not just post satisfactory results, but will write success stories. Future Group will not just operate efficiently in the Indian economy, will evolve it. Future Future Group will not just spot spot trends, trends, group will set trends trends by marrying marrying their their understanding of the Indian consumer to their needs of tomorrow. It is this understandin understanding g that has helped Future Group succeeds. succeeds. This will help group succeed in the Future. The group shall keep relearning and in this process, do just one thing. “Rewrite Rules. Retain Values”
Group Vision
Future Group shall deliver Everything, Everywhere, Every time for Every Indian Consumer in the most profitable manner.
Group Mission •
To share the vision and belief that the customers and stakeholders shall be
served only by creating creating and executing future scenarios in the consumption consumption space leading to economic development. •
To be the trendse trendsetter tterss in evolvi evolving ng delive delivery ry format formats, s, creati creating ng retail retail realty, realty,
making consumption affordable for all customer segments – for classes and for masses. •
To infuse Indian brands with confidence and renewed ambition.
•
To be efficient, cost- conscious and committed to quality in whatever we do.
•
To ensure that positive attitude, sincerity, humility and united determination
shall be the driving forces to make the organization successful.
Formats, Group Companies & JV of Pantaloon Retail India Ltd
Men Section
Women Section
SWOT Analysis of Pantaloon Retail (India) Ltd. Strength
Industry leader
First Mover Advantage
Higher Bargaining Power to higher number of store and good coverage
Weakness
Government rules and regulations
are not favorable FDI policy not so favorable for tie-
ups
Highest number of formats of stores
Cannibalization within the formats
Easy to attract talent
Recession and global melt-down
Highest market share in Organized retail
affected the performance of the
Strong Good Will in market which helps
book
them in raising money for expansion, forming JV, entering new market or new
Shrinking margins due higher
input costs
format
Diversified business
Stronger private label brands
Opportunities
Luxury brand segments untapped by
pantaloon
Tie-up with foreign player to bring in technical expertise and funds to expands
Threats
Rapid expansion by current players
like Trent, Shoppers Stop, Reliance, More, Bharti and Spencers
Tie-up of competitors with foreign
aggressively
retail giants. For example Bharti &
Smaller formats should expand more
Walmart
aggressively in tier II and tier III cities
Scope of Private labels
Integrating supply chain with other retailers
License agreement with foreign brands
Restaurant and fast food chain included in the current formats
Market conditions highly volatile
last year due to meltdown
Real estate price & Rentals lowering
Sales Promotion techniques at Pantaloon Retail (I) Ltd. 1. Price-off offer: Under this offer, products are sold at a price lower than the original price. This type of scheme is designed to boost up sales in off-season and sometimes while introducing a new product in the market. Example: •
Buy 2 men T-shirts at Rs. 599/- and 1 T-shirt at Rs. 399/- (MRP: Rs.399/Tshirt).
•
Buy 2 men T-shirts at Rs. 749/- and 1 T-shirt at Rs. 499/- (MRP: Rs.499/Tshirt).
•
Buy 3 men round neck T-shirts for f or Rs. 399/- (MRP: Rs.199/Tshirt). •
Buy 2 men V neck T-shirts at Rs. 499/- and 1 T-shirt for Rs. 299/- (MRP:
Rs.299/Tshirt). •
•
Buy 3 women T-shirts at Rs. 399/- (MRP: Rs.199/Tshirt). Buy 1 woman top and get Rs. 100/- off on the bottoms.
2. Discounts:
Under this, the products are sold at a discounted price with percentage discounts on the original price. This type of scheme is designed to boost up sales in off-season. Example: •
30% off on all the men formal shirts and trousers.
•
30 % off on all the women formals and casual outfits.
3. En End d of of sea seaso son n sal sale: e:
End of Season sale or stock Clearance sale is been conducted at Pantaloon Factory Outlets. They are offering surprising discounts as if you buy 2 any items of garments and you will get 3 more with your choice absolutely free. These offers are given as celebration of New Year.
4. Seas Season onal al offe offers rs::
Pantaloon provides the customers with various discounts and price-off offers at the stores and factory outlets on the seasons like winter and monsoon. This type of scheme is designed to boost up sales in these seasons.
5. Fest Festiv ivee offe offers rs::
Pantaloons have come up with festive offer during Diwali and Christmas by giving away gifts for purchases that are made at the store for cheaper price. If you shop for Rs. 4500 you get a Strolley bag worth Rs. 1299 for Rs. 149 only. If you shop for Rs. 2400 and above you get a lemon set, which is said to be imported, worth Rs. 649 for Rs. 99 only.
6. New New Yea Yearr off offer ers: s:
Pantaloons Pantaloons offers gifts for purchases purchases that are make at the store during the New Year for cheaper price. If you shop for Rs. 3500 you get a Imported Designer Glass Set for Rs. 249 only. If you shop for Rs. 2500, you get a 3 nights and 4 days holiday package for a couple on an International cruise.
7. Disc Discou ount nt Cou Coupo pons ns::
Pantaloon offers 25% discount on its large range of apparels. The coupon is valid for limi limited ted peri period od.. This This coup coupon on is vali valid d for for 25% 25% off off on any any prod produc uctt purch purchas ased ed from www.pantaloon.futurebazaar.com.
8. Gift Gift Vouc Vouche hers rs::
Pant Pantal aloo oons ns Fres Fresh h Fash Fashio ion n offer offerss many many Pant Pantal aloo oons ns vouc vouche hers rs rangi ranging ng diffe differe rent nt denominations like Rs100, Rs.250, Rs.1000 and Rs.2000. These Pantaloons vouchers are exchangeable with the products by the customers at all the Pantaloons Showrooms in India. The vouchers are a better option rather than gifts for the employees and customers as they are not bound for a particular thing to accept. They are given free choice for choosing better gifts for themselves by using vouchers. Pantaloons vouchers offer a wide range of products and services for shopping. It has got coverage in 15 cities including including 22 outlets. It thus offers good gift vouchers vouchers to its customers, clients and sales force also to keep good relationships amongst each other. The most famous famous Gift Vouchers by Pantaloons Pantaloons Fresh Fashion are Trendsetters and Connoisseurs Choice. Trendset Tren dsetters ters Gift Voucher Voucher: This Pantaloons voucher to the customers for the
products of value of Rs.500 at all showrooms of Pantaloons all over India. This voucher voucher is valid for all apparels apparels only. The amount of the products products bought have to be within the face value of the voucher, if it exceeds the actual amount the customer has to pay the exceeded amount after the shopping. This gift voucher is valid till 1 year from the issue date. It can not be exchanged to part or full cash.
Connoisseurs Choice: This Pantaloons voucher is available for the products valued
at Rs.500 at all Pantaloons showrooms. This is known to be as good as the cash under Pant Pantal aloo oons ns.. This This is vali valid d for for one one year year after after issu issuan ance. ce. The The vouc vouche herr can can not not be
exchanged neither it can be encashed. The voucher can be converted for once. Any balance on voucher will not be exchanged as cash or any product. The pantaloons all over India have got this facility so that the customers can avail it any time any where.
9. Pantaloo Pantaloon n loyalt loyalty y progra program m (Gree (Green n card) card)::
Green Card is a passport to a whole new world of exclusive benefits and privileges to the customers. •
Instant discounts for every time you shop at Pantaloons.
•
Exclusive shopping days to get hold of latest merchandise.
•
Regular updates on collections and promos via catalogues, sms and email.
•
Special invites to the most happening events.
•
Extended exchange periods and complimentary drops for alterations.
•
Exclusive billing counters and much more.
Shopper’s Stop Ltd., has redefined retail in India, taking it to the next level. From being just the sale of goods to consumers, the company has created a unique aura aroun around d retai retaill and and turn turned ed it into into an expe experi rien ence, ce, an indu indulg lgen ence ce.. The The pion pioneer eer of organized retail in India, Shopper’s Stop Ltd., has been instrumental in bringing about a retail revolution in the country and has become the highest benchmark for the industry. With its growth plans firmly in place and undeniable leadership in the field, Shopper’s Stop Ltd., is well on its way to raise the bar of performance even higher. Shopper’s Stop Ltd. has made this purchase of goods extremely pleasurable. The stores have redefined shopping by making it more than just a transaction. The entire shopping process is the coming together of an amazing array of offerings, warm but unobtrusive service and special privileges and benefits that translate every visit into customer delight.
Since its inception in 1991, Shopper’s Stop Ltd., which was founded by the K Raheja Corp. Group (Chandru L Raheja Group), one of the leading players in the country in the business of real estate development and hotels, has been offering premium and luxury value for the entire family. Shopper’s Stop Ltd. has metamorphosed from being a chain of retail stores to emerging as a Fashion & Lifestyle destination, which now now incl includ udes es retai retaill conc concep epts ts such such as book bookst stor ores es,, cafés cafés and and high high-en -end d lifes lifesty tyle le mercha merchandi ndise se for the growin growing g afflue affluent nt middle middle class class in India. India. Today Today,, its name name is synonymous with superior quality product, services and above all, an international shopping experience. In order to enhance the level of customer service and gain insight into new and emerging emerging practices followed internationally, internationally, Shopper’s Shopper’s Stop Ltd. is a member member of the Inter Continental Continental Group of Department Department Stores (IGDS). It is the only Indian member along along with with 29 othe otherr expe experie rienc nced ed retai retailer lerss from from all all over over the the worl world. d. Leve Levera ragi ging ng expertise, excellence and experience, Shopper’s Stop Ltd. has become a benchmark for for the the Indi Indian an reta retail il indu indust stry ry to foll follow ow.. A pion pionee eerr of orga organi nize zed d reta retail il in Indi India, a, Shoppers’ Stop today, is the country’s biggest Department Store Chain. It offers custom customers ers an intern internati ationa onall shoppi shopping ng enviro environme nment nt and a worldworld-clas classs shopp shopping ing experience through its 20 stores in 11 cities. It houses a host of international and domestic brands across categories such as apparel, accessories, cosmetics, home & kitchenware as also its own private brands. Shoppers’ Stop offers a wide range of brands (more than 400 brands) for the entire family to choose from. Exclusive and
established established brands brands share shelf space space to offer an array of choices customers customers across all ages, tastes and occasions. Shoppers’ Stop is the single largest retailer for Levi’s Strauss, Pepe, Lee, Arrow, Zodiac, Ray-Ban, Swatch, among others.
Private Labels Shoppers Stop has a range of Private Labels across Men's casual wear to formals to Women's wear. Private Labels contribute a mere 20% to its Total Sales. Here are the Private Labels Sold in Shoppers Stop outlet, •
Kashish - Mens's Ethnic Wear
•
Stop - Western Wear - Men & Women
•
Life - Mens Casual Wear , Jeans Wear
•
Mario Zegnoti - Men's Formal Wear
•
Acropolis - Men's Formal Wear
•
Push and Shove - Eye Wear
•
Vettorio Fratini - Premium Men's Wear
Men Section
Women Section
SWOT ANALYSIS OF SHOPPERS STOP:
Strengths
Weakness
•
Variety
•
Very high prices
•
Range
•
Less Schemes
•
Different Brands
•
Less Discounts
•
Pioneer
•
Competition from standalone stores
•
Loyal customer
•
Late entry into value retailing
•
Low risk
•
Store makeover expenditure
•
Good financial position
•
Presence across various segments
•
Parikrama the festival
Threats
Opportunities
•
Government Policies
•
Awareness about the brands
•
Entrance of New Players
•
Quality
•
High attrition
•
Youngsters
•
Lesser consumer spending
•
Higher disposable income
•
Entry of foreign players
•
Collaborate
•
Unorganized sector
•
Private levels
•
Independent stores
•
Tier 2 & tier 3 cities
•
Enter new consumer goods segments
Sales Promotion techniques at Shoppers stop 1. Price-off offer: Under this offer, products are sold at a price lower than the original price. This type of scheme is designed to boost up sales in off-season and sometimes while introducing a new product in the market. Example: •
Buy 2 men T-shirts at Rs. 799/- and 1 T-shirt at Rs. 499/- (MRP: Rs.499/Tshirt).
•
Buy 3 women T-shirts at Rs. 999/- (MRP: Rs.499/Tshirt).
2. Discounts:
Under this, the products are sold at a discounted price with percentage discounts on the original price. This type of scheme is designed to boost up sales in off-season. Example: •
20% off on all the men formal shirts and trousers.
•
20 % off on all the women formals and casual outfits.
3. En End d of seas season on sale sale::
End of Season sale or stock Clearance sale is been conducted at Shopper’s stop. They are offering surprising discounts upto 50% on all the men and women apparels. These offers were given last year for limited period in the month of September.
4. Seas Season onal al off offer ers: s:
Shopper’s stop provides the customers with various discounts and price-off offers at the stores on the seasons like winter and monsoon. This type of scheme is designed to boost up sales in these seasons. Different offers are provided by the stores during these periods from June to January.
5. Fest Festiv ivee off offer ers: s:
Shopper’s stop have come up with festive offer during Diwali and Christmas by giving away gifts for purchases that are made at the store for cheaper price or free. If you purchase men apparel worth Rs. 6000/-, the you are entitled to get a Polo bag worth Rs. 2000/- absolutely free.
6. Gift Vouchers: Shoppers Stop offer Gift Vouchers of denomination ranging from Rs. 250 to Rs. 5000.
7. Repu Republ blic ic Day Day offe offer: r:
Shopper’s stop conducted 3 Day Surprise offer on the occasion of Republic Day, giving flat 20 percent discount coupons on purchase of goods worth Rs. 3000/-, which can be redeemed on the next purchase.
8. Contests: Shoppers Stop has announced a 101-day Shopping Bonanza to pull in customers into the stores. Lucky draw winners of the contest will get to see one of the seven wonders of the world and two lucky couples who get the grand prize will be treated to a roundtrip which will cover all the seven wonders of the world.
9. Shopper’ Shopper’ss stop loyalty loyalty program program (First (First Citizen Citizen Citibank Citibank credi creditt card)
As s First Citizen Credit card member, you get the benefits of the Shopper’s Stop loyalty program, First Citizen. The First Citizen membership entitles you to exclusive privileges such as product previews, priority billing and other special benefits. Add to this, the fabulous experience of shopping at the premier Shopper’s stop outlets across the country.
10. Exchange Exchange offer: offer:
Under this offer, you have to bring in you old salwar kameez and take away a new one with discounted price.
Style, affordable prices, quality these are the factors that have shaped Westside's success story in the retail fashion stores business. Launched in 1998 in Bangalore, the Westside chain has, ever since, been setting the standards for other fashion retailers to follow.
Established in 1998 as part of the Tata Group, Trent Ltd. operates Westside, one of India's largest and fastest growing chains of retail stores. The Westside stores have
numerous departments to meet the varied shopping needs of customers. These include Mensw Menswea ear, r, Wome Women’ n’ss wear wear,, Kid’ Kid’ss wear wear,, Foot Footwe wear ar,, Cosm Cosmet etic ics, s, Perfu Perfume mess and and Handbags, Handbags, Household Household Accessories, Accessories, lingerie, lingerie, and Gifts. The company has already already established 36 Westside departmental stores (measuring 15,000-30,000 square feet each) in Ahmedabad, Bangalore, Chennai, Delhi, Gurgaon, Ghaziabad & Noida (to be consid considere ered d as 1 city), city), Hydera Hyderabad bad,, Indore Indore,, Jaipur Jaipur,, Kolka Kolkata, ta, Ludhia Ludhiana, na, Luckno Lucknow, w, Mumbai, Mysore, Nagpur, Pune, Rajkot, Surat, Vadodara and Jammu. The company hopes to expand rapidly with similar format stores that offer a fine balance between style and price retailing. Trent ventured into the hypermarket business in 2004 with Star Bazaar, providing an ample assortment of products made available at the lowest prices, aptly exemplifying its ‘Chota Budget, Lambi Shopping’ motto. At present Star Bazaar has 4 stores in 3 cities located in Ahmedabad, Mumbai and Bangalore. This store offers customers an eclectic array of products that include staple foods, beverages, health and beauty products, vegetables, fruits, dairy products, c onsumer electronics and household items at the most affordable prices. This story began circa 1998 when The Tatas acquired Littlewoods – a London based retail chain. This acquisition was followed by the establ establish ishmen mentt of Trent Trent Ltd (a Tata Tata enterp enterpris risee that that presen presently tly operate operatess Westsi Westside) de).. Litt Littlew lewoo oods ds was was subs subseq eque uent ntly ly rena rename med d We West stsi side de.. In a rapi rapidl dly y evol evolvi ving ng retai retaill scenario, Westside has carved a niche for its brand of merchandise creating a loyal following. Currently, the company has 36 Westside stores measuring 15,000-30,000 square feet each across 20 cities. With a variety of designs and styles, everything at Westside is exclusively designed and the merchandise ranges from stylized clothes, footwear and accessories for men, women and children to well-co-coordinated table linens, artifacts, home accessories and furnishings. Well-designed interiors, sprawling space, prime locations and coffee shops enhance the customers’ shopping experience.
SWOT ANALYSIS OF WESTSIDE:
Strengths
Weakness
•
Growing at the faster pace
•
Brand name of TATA’s.
•
Good customer base.
•
Apparels are cheaper
•
Attractive promotional schemes
•
Not much product range for middle class
•
Facing problems due to political environment
•
Need help in taking over properties and real estate
and heavy discounts •
Quality and branded stuff only
•
Location advantage
•
Need some concessions from labor laws
•
Lack of differentiation
•
Poor inventory turns and stock availability
Opportunities •
Huge untapped market
•
Rising disposable income
•
Urbanization
Threats •
Competition from organized retail players
•
Ladies Section
Competition from local retailers.
Men Section
Kids Section PRIVATE LABELS
Private label products or services are typically those manufactured or provided by
one compan company y for offer offer under under anothe anotherr compan company's y's brand. brand. Privat Privatee label label goods goods and services are available in a wide range of industries from food to cosmetics to web hosting. They are often positioned as lower cost alternatives to regional, national or international brand. Westside has many private labels in its merchandise portfolio. Private labels in Westside include•
2F4U
•
SRC
•
Gia
•
Urban angel
•
Intima
•
David Jones
•
Ascot
All these brands are produced produced for Westside only and can be found in Westside Westside only. These apparel brands are given separate space for displaying their merchandise and more promotional offers are there on them to increase their sales. At some places, these private brands are mixed with branded clothes so in that case these private labels are put in lower shelves. At eyesight level, branded clothes are put.
Sales Promotion techniques at Westside 1. Fest Festiv ivee off offer ers: s:
With this Diwali Delight offer from Westside if you shop from their store for Rs. 5000 and above you get a gift voucher from them for Rs. 1000 for free. And if you shop for Rs. 2500 and above you get a free gift voucher worth Rs. 400. This is valid only if you purchase their in-house merchandise or brands only and not valid if you chose
to
buy
other
2. En End d of seas season on sale sale::
brands
available
at
their
store.
End of Season sale or stock Clearance sale is been conducted at Westside. They are offering surprising discounts upto 50% on all the men and women apparels. These offers were given last year for limited period in the month of January and July.
3. Gift Gift Vouc Vouche hers rs::
Westside offers Gift Vouchers of denomination ranging from Rs. 100 to Rs. 10000.
4. Westside loyalty program (Club west card program): An assured return-and-exchange policy reinforces customer confidence in the chain. Another winning Westside idea is Club West, a customer loyalty program launched in May 2001. The 30,000-plus members of this club get rebates at restaurants and on holiday packages from the Taj Group of Hotels, home delivery of alterations, and best of all, special shopping hours on the first day of any discount sales event organized by the chain.
5. Contests:
Shop for Rs 1,000 at Westside, participate in the lucky draw and win the grand prize a complete holiday packages for two to Macau. You could also win holiday packages to bre breath athtak taking ing bea beach ch des destin tinati ations ons in Ind India ia inc includ luding ing Goa Goa,, Kov Kovalam alam,, Pur Purii and Pondicherry.
6. Discounts:
Under this, the products are sold at a discounted price with percentage discounts on the original price. This type of scheme is designed to boost up sales in off-season. Example: •
20 - 50% off on all the men formal shirts and trousers.
•
20 – 50 % off on all the women formals and casual outfits.
Findings
Sales Promotion
Pantaloon
Westside
1.End of season
Yes
Yes
Shopper’s Stop Yes
2.Festive Promotions (Diwali, Christmas etc)
Yes
Yes
Yes
Loyalty card Programme
Yes
Yes
Yes
Special Promotion (event)
Yes (Exchange offer)
No
Yes (Exchange offer)
Joint promotion
No
No
No
Media used
Hoardings, print, electronic (SMS, E-mail), POP In-store media
Print, electronic, hoardings, In-store media
Print, electronic, hoardings, In-store media
Promotion type
Price off, free gifts, exchange offer, Festive offers, End of season sale, Loyalty program
Gift vouchers, discount, contest, End of season
Discounts, gift vouchers, free gifts, exchange offer, End of season sale, Loyalty program
•
From the above table, it is clear that all three stores engage in end of season sale. This This reinfo reinforce rcess the fact fact that that season seasonali ality ty affect affectss appar apparel el sector sector and hence hence it bec becom omes es criti critica call for for a reta retail iler er to clea clearr off off the the stoc stocks ks at the the end end of seas season on,, otherwise, he may have to incur substantial inventory carrying costs, allocate scarce scarce shelf space space and out of fashio fashion n appare apparels ls maybe maybe worthle worthless. ss. Thus Thus stock stock clearance seems to be very important objective for apparel retailer in using end of season sale wherein discount given is upto 50% of the MRP (Maximum retail price).
•
All the three stores use loyalty cards to reward loyal users and encourage them to visit the store often and buy more by offering wide range for men, women and childr children. en. Some Some store store also also offer offer home home furnis furnishin hings, gs, access accessori ories es and footwe footwear, ar, thereby providing convenience for one stop shopping.
•
Joint sales promotion involves tieing up with other brands like, MacDonald, Havmore, Gold’s (local) Gym and Kaya skin clinic, etc. None of the three stores has yet explored avenue of joint sales promotion. Such joint promotions have have adva advant ntag ages es in terms terms of shari sharing ng cost costss of prom promot otio ions ns,, cros crosss sell sellin ing g opportunities to each other’s customers, higher visibility etc .
•
In term termss of type type of cons consum umer er sale saless prom promot otio ions ns,, almos almostt every everyon onee used used discount, coupon programmes and lucky draws, contests, gift, buy one get one free type of promotions . Pantaloon and Shopper’s Stop uses exchange offer.
Conclusion Usage of sales promotion activities has a direct impact on consumer behaviour as it motivates a consumer to buy now rather than in future, enhances value of an offer temporarily temporarily till the promotion promotion period, encourages encourages switching, switching, reinforce reinforce or reward loyalty etc. Broadly, objectives set for these activities are; •
To generate store traffic,
•
To move excess inventory,
•
To enhance store image and
•
To create a price image (high or low).
Traffic building is achieved by special event promotions like Diwali, Rakshabandhan promotions; inventory reduction through end of season sale; creation and building store image through feature advertising and displays and joint promotions and price image by highlighting the discounts. It helps consumer reduce not only financial risk but also psych psycholo ologic gical al and social social risk risk by making making consum consumer er confid confident ent of his/he his/herr purcha purchase, se, conformation to group norms by shopping at famous stores/brands and possibility of acquiring well known branded apparel during promotions. Promotions may induce non buyers to walk in to the store and loyalty programmes may encourage them to buy more, more more often often or upgrad upgradee to better better qualit quality. y. Exciti Exciting ng promot promotion ionss also also have have tenden tendency cy to generate positive word of mouth and help consumer feel a smart shopper. Thus, not only provi provide de utilita utilitarian rian benefi benefits ts like, like, saving saving of money, money, time time or qualit quality y up gradat gradation ion but hedoni hedonicc benefit benefitss like like feeling feeling confid confident ent,, feeling feeling of excite excitemen mentt and entert entertainm ainment ent etc. Execution of the sales promotion activities also require proper coordination of selling effort and availability of promoted merchandise. Apparel sector is likely to grow with growing Indian economy. Many multinational players either have already already plunged into Indian market or plan to do so in apparel sector. 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. Indian brands will have to withsta withstand nd turbul turbulent ent condi conditio tions ns and learn to surviv survive. e. If the role role of such such promot promotion ional al activities is understood well, it may help any player a long way to survive and grow.
Bibliography
•
www.google.com
•
www.pantaloon.com
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www.mywestside.com
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www.shoppersstop.com
•
http://besteoffers.blogspot.com/2009/1 http://besteoffers.blogspot.com/2009/12/free-discount2/free-discountcoupon-of-25-of.html
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www.futurebazaar.com
