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INDEX
CONTENT
CHAPTER-1
Introduction of the Project
CHAPTER-2
Objective, Scope & Limitations of the Study
CHAPTER-3
Research Methodology
CHAPTER-4
Data collection & Analysis
CHAPTER-5
Findings of the study
CHAPTER-6
Conclusion
Suggestion
Appendix
Bibliography
Questionnaire
Retailing sector of India can be split into two segments. They are the informal and the formal
retailing sector. The informal retailing sector is comprised of small retailers. For this sector, it is
very difficult to implement the tax laws. There is widespread tax evasion. It is also cumbersome
to regulate the labor laws in this sector. As far as the formal retailing sector is concerned, it is
comprised of large retailers. Stringent tax and labor laws are implemented in this sector.
If the retail industry is divided on the basis of retail formats then it can be split into the modern
format retailers and the traditional format retailers. The modern format retailers comprise of the
supermarkets, Hypermarkets, Departmental Stores, Specialty Chains and company owned and
operated retail stores
The traditional format retailers comprise of Kiranas, Kiosks, Street Markets and the multiple
brand outlets. The retail industry can also be subdivided into the organized and the unorganized
sector. The organized retail sector occupies about 3% of the aggregate retail industry in India.
next to China. Among all the global markets, the Indian retail market is the most expanding. This
is owing to absence in restriction at the entry level. So the large foreign companies can reap the
benefits of economies scale by entering the green retail fields of India. There are many reasons
why the retail industry in India can reach the zenith.
Firstly the organized retail sector in India has a very low contribution to the entire retail sector in
the country. Hence there is ample scope for the new players to achieve success in the backdrop of
soaring disposable income of the upcoming generation. Secondly, not only have the incomes
increased but there has been a sea change in the preferences of the consumers. These factors have
acted as a stimulus for the ushering of foreign players retailing in apparels, accessories,
electronic appliances etc. Large shopping malls have already mushroomed in the metropolitan
cities. There still lies untapped potential in the Indian Retail Market.
The size of retail industry in an economy depends on many factors and the level of consumer
spending is the most important among these factors. The retail sector in India has grown by leaps
and bounds in the last five years. The reason behind this growth has been the synergy of many
propellants. However the growth is not always genuine as there are exaggerations as well. But
these exaggerations also have benefits since they given a feel of growing competition all around.
Secondly the present situation is just a depiction of nascent stage. The future of the trajectory
may not be as steep as it is now or may be even slope downward. 'What will be the future size of
the retail industry' is the mind boggling question. Another moot point that will gain importance
in due time concerns the future of the unorganized retail market which constitute a significant
proportion of the whole industry. The retail stores have proved to be a vantage point for the
customers. This implies that the small farmers who used to sell their product in the sabji-mandis
and on roadsides are going to lose a significant market share as they can't employ the two profit
maximizers-economies of scale and economies of scope.
Rs. 12,00,000 crore($270 billion) and the annual growth rate is 5.7 percent. Retail market for
food and grocery with a worth of Rs. 7, 43,900 crore is the largest of the different types of retail
industries present in India. Furthermore around 15 million retail outlets help India win the crown
of having the highest retail outlet density in the world. The contribution of retail sector to GDP
has been manifested below:
Country
Retail
Sector's
India
USA
China
Brazil
in GDP (in %)
10
10
8
6
share
As can be clearly seen, retailing in India is superior to those of its contenders. Retail sector is a
sunrise industry in India and the prospect for growth is simply huge. There are many factors that
have stimulated the rise of the shopping centers and multiplex-malls in a jiffy. Some of them can
be listed as follows:
Rise in the purchasing power of Indians- the rise in the per capita income in the last few
years has been magnificent. This has led to the generation of insatiable wants of the upper
and middle class. The demand of new as well as second hand durables has risen
throughout the country thus providing the incentive for taking up retailing.
Favorable to farmers- retailing has helped in removing the middlemen and has thus
enhanced the remuneration to farmers. This is a new revolution in the agricultural sector
in India and will go a long way in amending the condition of agriculture, a major concern
among policy makers.
Use of credit- a typical Indian is most conversant with using credit cards than carrying
money. These have led to a shift of the consumer base towards supermarkets and make
the payments in the form of credit.
Comfortable Atmosphere- a visit to a retail store appears to be more soothing for the
generation-Y. People and kids prefer to shop in an air conditioned a tech savvy manner.
The retail industry is the second largest employer in India. It currently employs about 7
percent of the total labor force in India. Finance Minister P. Chidambaram's recent
statement salaries ought not to be legislated is a welcome move as most of the
organized retail is in private hands. However only about 4.6% of the total retail trade is in
organized sector. It generates about Rs.55, 000 crore ($12.4 billion). The major and minor
players desperately need to work hard in this direction so that next time the figures look
more decent. The government must also make an attempt to ameliorate the situation as
political instability and infrastructure namely power and roads are the major roadblocks
in the path of smooth functioning of the market.
gradually came down. The organized retail sector in Japan couldn't perform at its full efficiency
because of collapse of the 'bubble economy' in the early 90s.
The distribution sector bridges the gap between the producer and consumer and thus forms a
crucial link. Distribution of retail in India has multiple dimensions. Its uniformity is difficult to
decide and easy to argue. Distribution in any sector is usually measured by the reach of its
products to people. But in case of the retail sector in India it also implies the dispersion among
the organized and unorganized spheres. The question of distribution hovers mainly around the
intentions of private players to reach out to the less rich people. But the point that has caught
the public eye recently is the ambiguous mood of the beneficiaries and the chauvinist
government that produces civil service.
on groceries (foodstuffs). These figures are intensified by the fact that Indians have special
preference for lifestyle products and they feel comfortable in buying against credit as the credit
card and mortgage market has been growing by more than 30%.
We present the results from another survey below in order to strengthen our findings.
Number
of
stores
India
Japan
USA
The above table reinforces our view that India has done a great job in retailing. One
noteworthy point here is that Japan in spite of being one of the most densely populated
countries has fared poorly than India. But this euphoria loses its charm if we compare the
percentage of organized retail in the total value generated by the retailing sector.
retailing So it is high time that the retail industries pay importance to diversification and reach
out to non-urban markets. If they remain confined to the metropolis then they will soon hit a
ceiling and will be able to grow no more. But at the same time they must realize that the rustic
people are sceptic about the urbane lifestyle habits. The mega retail players will have to drop
their policy of full extraction of consumer surplus and will have to employ the local people to
overcome the myth that entry of a branded retail will displace the millions of traders,
shopkeepers and hawkers. Protests must be welcomed and meetings encouraged making life
saner.
Retail markets in Germany, South Africa and many other countries allow 100% foreign
investment in retail. This has helped in setting up of cash and in creating wholesale markets.
However, in India, only 51% FDI is allowed in single-brand retail and that too with prior
approval. In case of multi-brand retail, FDI is completely prohibited. This is a perfect
beginning but foreign investment should be gradually liberalized to modernize farming and
help farmers scale up. Moreover, restricting FDI for protecting mom-and-pop stores seems
unjustifiable since Tata, Reliance and Bharti have already made a foray in the sector.
However, according to the survey conducted by KPMG for Federation of Indian Chamber of
Commerce and Industry (FICCI), among these, the food and grocery is expected to witness the
fastest growth followed by clothing as the second-fastest growing segment.
Marketing Strategies
Marketing strategy is a method of focusing an organization's energies and resources on a
course of action which can lead to increased sales and dominance of a targeted market niche. A
marketing strategy combines product development, promotion, distribution, pricing, relationship
management and other elements; identifies the firm's marketing goals, and explains how they
will be achieved, ideally within a stated timeframe. Marketing strategy determines the choice of
target market segments, positioning, marketing mix, and allocation of resources. It is most
effective when it is an integral component of overall firm strategy, defining how the organization
will successfully engage customers, prospects, and competitors in the market arena. Corporate
strategies, corporate missions, and corporate goals. As the customer constitutes the source of a
company's revenue, marketing strategy is closely linked with sales.
Types of strategies
Marketing strategies may differ depending on the unique situation of the individual business.
However there are a number of ways of categorizing some generic strategies. A brief description
of the most common categorizing schemes is presented below:
10
Strategies based on market dominance - In this scheme, firms are classified based on their
market share or dominance of an industry. Typically there are four types of market
dominance strategies:
o Leader
o Challenger
o Follower
o Nicher
Porter generic strategies - strategy on the dimensions of strategic scope and strategic
strength. Strategic scope refers to the market penetration while strategic strength refers to
the firms sustainable competitive advantage. The generic strategy framework (porter
1984) comprises two alternatives each with two alternative scopes. These are
Differentiation and low-cost leadership each with a dimension of Focus-broad or narrow.
o Product differentiation
o Market segmentation
Innovation strategies - This deals with the firm's rate of the new product development and
business model innovation. It asks whether the company is on the cutting edge of
technology and business innovation. There are three types:
o Pioneers
o Close followers
o Late followers
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Growth strategies - In this scheme we ask the question, How should the firm grow?.
There are a number of different ways of answering that question, but the most common
gives four answers:
o Horizontal integration
o Vertical integration
o Diversification
o Intensification
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RELIANCE RETAIL LTD has launched its much-awaited hypermarket format (which also
happens to be Indias largest hypermarket) called Reliance Mart at Iscon Mall, SG Highway,
Ahmadabad on August 15. After the successful launch of the supermarket format Reliance
Organized
Supermarkets
Hypermarkets
Unorganized
Kiranas:
Traditional Mom
and Pop Stores
Kiosks
Department
Stores
Specialty Chains
Street Markets
Company Owned
Company
Operated
Exclusive
/Multiple Brand
Outlets
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Fresh and the consumer electronics concept mega store Reliance Digital, the hypermarket is
the third retail format launched by Reliance Retail.
Spread across 165,000 square feet of shopping area, Reliance Mart will provide the shoppers a
never-before-experienced shopping delight. The hypermarket will carry a range of over 95,000
products catering to the entire family. Shoppers will have the option to choose from a wide array
of products in every category ranging from fresh produce, food & grocery, home care products,
apparel and accessories, non-food FMCG products, consumer durables and IT, automotive
accessories, lifestyle products, footwear and much more.
Commenting on the launch, Shri. Mukesh Ambani, Chairman and Managing Director, Reliance
Industries Ltd, said: Organized retail has the potential to trigger socio-economic transformation
on an unprecedented scale in our country and will bring about enormous spin-off benefits to the
Indian economy and its various constituents.
The launch of Reliance Mart is yet another step by Reliance Retail towards providing
international shopping experience to all our customers at unmatched affordability, guaranteed
quality and choice of products and services. Reliance Mart marks the achievement of another
milestone in our effort to unleash a retail revolution in India. Shri Ambani added.
Reliance Mart offers some unique services to the shoppers like tailoring, shoe repair, watch
repair, a photo shop, gift services and laundry services, all within the store. The store also houses
its own fresh bakery, serving hot, off-the-oven bread and bread products throughout the day
and local savouries, an ice-cream train for the kids, a chakki, ready-made batter and loose tea and
pickle for the housewives.
Reliance Mart will also sell fine jewellery and fashion jewellery as
The hypermarket also launched a host of Reliances own brands in select categories with superior
quality and affordable prices like First Class, Network, Netplay, Team Spirit and Sparsh in
Mens and Womens Formal / Casual and Ethnic wear, DNM- X in the jeans category for men
and women, Panda for kids clothing and Grip in the luggage section. The footwear category
will carry Zig in formal wear. Hi Attitude for semi -formal, Tosco for party wear and
Monza for the sports enthusiast. There are many products that will be exclusively available in
Reliance Mart stores only.
Reliance Mart, with 61 check-out counters has for the first time in India introduced the Mobile
POS system for faster check outs. This is aimed at reducing customer wait-time. The store
planning, atmospherics and layout has been designed specifically to provide a complete
solution to the customer. Reliance Mart will remain open from 10:00 a.m. to 10:00 p.m., seven
days a week. The store has over 400 highly skilled and trained customer sales representatives.
Reliance Mart will continue to offer all its customers Reliance One, a common membership and
loyalty program across all its formats, which follows the philosophy of Earn Anywhere, Spend
Anywhere. Reliance Mart will also provide easy and attractive finance options, including 0%
financing for your purchases on select products. Reliance Retail plans to have a pan-India
presence by opening over 30 Reliance Mart hypermarkets this year and over 500 by the end of
2010.
Services Offered
It offers some unique services to the shoppers like tailoring, shoe repair, watch repair, a photo
shop, gifting services and laundry services all within the store under one roof and also it has its
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Future Plans
The next two hypermarkets are to be opened in Jamnagar in Gujarat and in the NCR by next
month with plans to open 30 such marts by the year. Raghu Pillai, President and CEO (operations
and strategy), Reliance Industries Limited (RIL) said the company is planning to set up 500
hypermarkets across 784 towns by 2010.
Strategy
The hypermarket would be selling the products on EDLP (every day low price) basis at prices
15-20 percent lower than market prices.
In order to grow faster and better in local markets with higher margins, it has focused largely on
local brands instead of national brands or private labels. Local brands include Induben
Khakrawalas Namkeens, Lijjat Papad, Wagh Bakri and Madhur (spices brand). This is in
addition to 100 private labels that Reliance plans to display. Companys Sources says that the
share of regional brands in the hyper marts would be over 10%.
Strengths
Keeping local brands at the outlets is more profitable and also makes the supply chain more
efficient. Being a bulk purchaser, Reliance Mart can offer products at very low prices. Also
taking into consideration the local brands, the products at the outlets would be easily acceptable
by the customers. And there would be comparatively less efforts needed by the marketer to
explain the product to the consumers.
Weaknesses
In some cases, few regional brands strongly liked by the consumers offer lower margins than that
16
offered by the national brands. It has to face a tough competition by big shopping malls i.e. Big
Bazaar, Spencer Hyper, Vishal Mega Mart and the upcoming Wall Mart.
Zeppelin :
Mens Shirts & Trousers
Kitaan Studio : Mens Shirts & Trousers
Fizzy Babe :
Jasmine :
Paranoia :
Soil :
Chlorine :
Mens Shirts
Massa Bay :
Mens Shirts
Mens Trousers &
Bermudas
Product
Vishal Mega Mart offers a wide range of products which starts from apparels to food items,
footwear to home furnishing, crockery to sport items, child care products to toys, watches, drinks
etc. There are many in house brands promoted by Vishal Mega Mart. In pursuance of their
business plan to diversify their portfolio of offerings, FMCG products play a key role.
Price
17
Vishal Mega Mart promises its consumers the lowest available price. The concept of
psychological discounting (Rs. 99, Rs. 49, etc.) is used as promotional tool. Vishal Mega Mart
also caters on Special Event Pricing (Close to Diwali, Christmas, New Year etc.). Selling combopacks and offering discount to customers. The combo-packs add value to customer. Through
Bundling, they also reduced the price of the products. In addition to VRPLs strategy to continue
procurement of goods from small and medium size vendors and manufacturers which leads to
cost efficiencies, VRPL intend to procure FMCG and apparels from low-cost production centers
located outside India. Towards this objective, VRPLs propose to increase their procurement of
finished and semi-finished goods from China and thereby realize economies of scale and pass on
the benefits so accrued to their customers.
Place
Vishal Mega Mart stores are located in 110 cities with more than 180 outlets. Vishal Mega Mart
has presence in almost all the major Indian cities. They are aggressive on their expansion plans.
VRPL intend to increase their penetration in the country by setting up new stores in cities where
they already have presence, as also entering into new areas in the country. In particular, they
intend to focus on expansion in Tier II and Tier III cities. VRPL target locations with good
infrastructural facilities such as easy accessibility, provision for water, electricity, parking,
security and other basic amenities.
Promotion
Advertising has played a crucial role in building of the brand. Vishal Mega Mart advertisements
are mainly seen in print media i.e. newspapers, Television with Tina Parekh as there in
advertisement, and sometime road-side bill-boards. VRPLs category management system is used
to plan promotional schemes. They launch promotional schemes weekly. Apart from general
sales promotion, the category manager formulates promotional plans for slow movers. In
addition, to promote sales, they focus on layout of the stores and positioning, presentation and
display of merchandise, in order to appeal to the customer. In addition, VRPL have introduced, in
association with SBI Cards & Payment Services Private Limited, a co-branded credit card.
VRPLs propose to continuously undertake such initiatives to increase the satisfaction of their
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customers. Some of the features of the co-branded card include Rs 250 discount voucher on
signing up for the card and a process by which the cardholder earns five reward points on every
Rs 100 spent. A cardholder accumulates points on the basis of purchases made and the points
accumulated can be redeemed for gifts or purchases. In September 2005, VRPL entered into a
long term advertising agreement with Bennett, Coleman & Company Limited (BCCL). Under
the agreement, they are entitled to fixed discounts for their advertisement in print publications of
BCCL for a period of five years from the date of the agreement. As a part consideration, VRPL
had issued 1,670,605 Equity Shares of Rs. 10 each and 384,190 Preference Shares of Rs. 146
each amounting to an aggregate of Rs. 300 million.
Strong understanding of the value retail segment
VRPLs business plan involves implementation of the concept of the value retailing, targeting
the middle and lower middle income groups, which constitute majority of the population in
India. VRPL intend to provide quality products at competitive prices. VRPL sell a vast range of
merchandise across apparels and accessories, FMCG products, food products and consumer
durables. VRPLs emphasis has been to maximize the value that the customers derive in spending
on goods bought in their stores. VRPL endeavor to continuously reduce their costs through a
variety of measures, such as, in-house production of apparels, procurement of goods directly
from the small and medium size vendors and manufacturers, efficient logistics and distribution
systems along with customized product mix at their stores depending on the regional customer
behavior and preferences. Central to their value retail strategy is to pass on the benefits of cost
reduction measures to their customers.
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Today Vishal Retail Limited, Flagship Company of Vishal Group, engaged in Hyper Market
stores with an average area of 25,000 to 30,000 sq. ft. through an impressive chain of more than
100 fully integrated stores in spread of more than the area of around 22, 00,000 sq. ft. in 69 cities
across India & has a plan to cross total retail area of 35 lakh sq. ft. in tier II and tier III cities by
the end of 2009
.
According to Mr. Ram Chandra Agarwal, CMD, Vishal Retail Limited, the group owes its
origin to a small 50 sq ft shop in Kolkata's Lal Bazaar that started selling readymade garments.
In tune with the pulse of the market, he envisioned a mega store that would sell garments at
prices none other could match. . The first big store opened in Calcutta's Esplanade area in 1997,
under the banner of Vishal Garments. He was involved in all the aspects of the business: right
from sourcing the garments to interacting with customers. And this led to his greatest finding
The Vishal Group.
After identifying the immense market in fashion garment for the masses, He moved to Delhi in
2001 and opened his first store in Delhis Rajouri Garden by the name of Vishal Mega Mart (The
jewel in Vishal Groups crown) and then there was no looking back for Mr. Ram Chandra
Agarwal. At present, in addition to garments, Vishal Mega Mart stores retail the entire range of
household products, FMCG and electronic goods. Vishal's prices are roughly 15 to 20 per cent
less than other mass market garment labels.
20
Mr. Ram Chandra Agarwal, CMD, Vishal Retail Limited believes that the shopping habits of
Indians are changing due to their growing disposable income, higher aspirations, relative
increase in the younger population, and the change in attitudes towards shopping. The emphasis
has changed from price consideration to design, quality and trendy. Age is also a major factor
that affects the spending decisions of an individual. Consumer spending is an important factor
that affects the economic growth and development in a country. As a trend, consumer is more
educated. He has access to all reforms taking place through various arrays of communication. He
is becoming a value shopper everyday.
Keeping this in mind, the group is now looking for franchisees to join hands with Vishal and
grow under common banner. This partnership will help small retailers to survive the onslaught of
organized retail as it will enhance their competitiveness. Small stores can avail of the benefits on
account of the economies of scale, a key advantage for big retailers. As per the plans, Vishal
Retail will completely take over the supply chain of its franchisees and provide them with
technology, new practices, visual merchandising skill and special promotional schemes, besides
its brand and costumer base.
Some of the Franchisee exclusive business categories are
Mens Fashion
Ladies and Kids
Footwear
Toys and Games
Home General
Convenience (FMCG)
CDIT
Watches
Mobile
The Group also has a plan to raise around Rs 200 crore through preferential issue in the next few
months to fund the companys expansion plan. Mr. R C Agarwal said Rs 100 crore corpus raised
through the initial public offering had already been utilized and more money was required to
push the expansion plans further.
21
The group has registered a consistent growth over the years. It recorded a whopping turnover
of more than Rs.700 crores in 2008-09 as opposed to a turnover of Rs 550 Crore for 20072008. This ascent has inspired the Group to chalk out an ambitious expansion program, with
expansion and growth plans being implemented on different dimensions.
Retailing is an engine for taking merchandise to the end-users. There is a lot of opportunity in
this sector for us since demand of the potential consumers are not being met under the existing
facilities. Therein lies the road to success. says Mr. R C Agarwal
Product Categories
- HOME FURNISHING
Drawing Room
Door Mat
Carpet
Curtains
Kitchen
Apron
Kitchen Napkin
Bedroom
Bed Sheet
Pillows
Pillow Cover
Bathroom
Bath Mats
Towel Gift Sets
FOOTWEAR
BOYS
Shoes
Sandals
LADIES
Shoes
Slippers
GIRLS
Slippers
Sandals
MENS
Shoes
Slippers
MENS
Upper
Shirt Casual
Shirt Formal
Ethnic & Sports
Night Suits
T-Shirts
Dupatta
Lower
Jeans(MP)
Cotton Trouser(MPC)
Winter Wear
Suit(WMC)
Blazer(WMB)
Windcheater(WMW)
22
Sherwani
Jacket
LADIES ACCESSORIES
Upper
Kurta
Skirt Top
Ethnic
Nighty
Lancha
Sharara
Salwar Suit
Lower
Pants Jeans
Capri
Winter Wear
Jackets
Stawl
Blazer
Track Suit
INFANTS
Garments
Hot Pant
Frock
Baba Suit
Accessories
Bed Sheet
Under Garments
Socks
WOMEN
Sarees
Fancy(SRF)
Synthetics
Banarsi
Jewellery
Necklace
Ring
Personal Items
Cap(LCA)
Socks(Las)
Cosmetics
LIp Gloss
Nail Polish
KIDS BOYS
Lower
Jeans
Bermudas
Dungries
Upper
Shirt Formal
T-Shirt
Sets
Night Suit
Baba Suit
Winter Wear
Suit
Blazer
Jacket
Ethnic
Kurta- Pyjama
Sherwani
KIDS GIRLS
Lower
Hot Pant
Skirt
Dungries
Upper
Tops(GWT)
Frock(GFK)
Sets
Night Suit
Capri Set
Winter Wear
Hipster Set
Blazer
Jacket
Ethnic
Sharara
Lancha
23
HOUSEHOLD
Dinner Set
Home Aids
Floor Wiper
Sanitary Brush
General Plastic Goods
Coffee Mug
Bucket
Glass Ware
Cup
L$emon Set
Jug
Pressure Cooker
Cooker
Pressure Pan
Electrical App.
Chopper
Microwave Oven
Thermo Ware
Tiffin
Container
Cake Server
Non Stick
Handi
Dosa Tawa
Bone China
Soup Set
Dessert Set
Porcelain
Cup & Saucer
Time Zone
Ladies Wrist Watch
Mens Wrist Watch
Mens Accessories
Opticals
Ladies Sun Glass
Mens Sun Glass
Electric & Electronics
Belts
Wallets
Items
Battery(ABT)
Calculator(EEC)
Spray
Deo
LIFESTYLE
Dolls
Musical Toys
Non-Musical
Board Games
Wooden Blocks
Puzzles
Barbie Doll
Other Dolls
Infant Toys
Teether
Swing
Cycles
Scooters
Video Games
T.V. Video Game
Hand Video Game
FOOD MART
FOOD & BEVERAGES
Snacks
Drinks
Objectives of Study
1. To Study the promotional strategies of RELIANCE MART & VISHAL MEGA MART.
24
2. To study the challenges and future prospects of RELIANCE MART & VISHAL MEGA
MART.
3. To study the different Brand offerings by RELIANCE MART & VISHAL MEGA MART.
4. To study the distribution strategies of RELIANCE MART & VISHAL MEGA MART.
LIMITATION
Although it would have been nice to conduct a perfect research study, but this study is conducted
under certain limitations, which were faced while doing this research. So it is highly
recommended to consider these limitations while going through the project study.
These limitations are as follows
1. LIMITATION OF DATA
The statistical data regarding the city was not available to us on secondary source of data
and to generate such data on the primary source was a task, which cannot be achieved in
such a short time.
2. LIMITATION OF TIME
The limitation of time was another constraint in the study as the study had to be
conducted in few months therefore many aspects have been left unexplored. Research
period is not just much enough to know fully about the strategies & consumers
perception
3. INHIBITIONS OF THE RESPONDENTS
25
The respondents did not reply the question with precision as they were busy with their
own work or they were not interested in taking part in such a research. Employees
sometimes feel hesitated while telling about their view about their marketing strategies.
4. RESEARCH HAS BEEN CONDUCTED IN A LIMITED AREA
The research has been conducted for the Vishal mega mart(sec-31.fbd) & reliance
mart(Crown Interiors Mall, Faridabad) but not all their retail outlet have been covered
therefore it has been mentioned that the research has been conducted in a limited area.
These limitations were very common and yet we came across these with a positive note and the
subsequent chapters in this report shall explain the rationality behind the structural compilation.
Research Methodology
Research Methodology is a way to systematically solve the research problem. When we talk to
research methodology we not only talk of research methods but also consider the logic behind
the method we use in the context of our research results are capable of being evaluated either by
researcher himself or by other.
26
The purpose of this section is to describe the methodology carried out to complete the work. The
methodology plays a dominant role in any research work. The effectiveness of any research work
depends upon the correctness and effectiveness of the research methodology.
This section deals with research design used, data collection, methods used and sampling
methods used.
Research design
A research design specifies the methods and procedures for conducting a particular research.
According to Ker linger Research design is a plan, structure and strategy of investigation
conceived so as to obtain answers to research questions and have to control variance.
My research design
I have chosen descriptive research design for my study because I am interested in knowing the
marketing strategies adopted by Reliance Mart & Vishal mega mart
To accomplish the predefined objectives of the research, descriptive research design is used to
collect the require information from the sources. Its a fact finding approach generalizing a cross
sectional study of the present situation.
Sampling method
27
Specific sampling method was used to collect the data from the respondents because sample size
is large. Customers & employees of Reliance Mart & Vishal mega mart were selected for the
survey.
Sampling unit
The data was collected from the Customers & employees by questionnaire and observation
method in the Reliance Mart (Crown Interiors Mall) & Vishal mega mart (sec-31.faridabad)
Sample size
The data were collected from:
50 customers
50 employees
Data collection:
There are two major methods of data collection:
Primary data
Secondary data
Primary data collection is used when there is need for collecting first hand data. In such cases, no
adequate and usable data is available to the researcher.
Secondary data collection is used where adequate and usable data is available to researcher.
Primary data collection by one person may become secondary data for another.
In my research study I have used both primary as well as secondary data collection method. For
primary data observation method is used, and for secondary data the sources used are books,
journals, magazines and Internet.
28
Data analysis
All the recommendations in this project have been suggested keeping in mind the thorough
analysis of all the steps in recruitment process.
Data collection methods
The method used for the survey process is through questionnaire.
29
Customer retention policy implementation is at the zonal level. Generally each state is
regarded as a zone and the offers and discounts in a zone are not available in other zones. Such
policy helps reliance retail to understand and capture the local markets better.
The products which show improvement due to offers and discounts on them are repeated with
these offers again so as to retain the sales of the customers who bought it the last time.
Also such the days best offers are constantly announced in the store making the regular
customers aware about them.
Maintaining a good store ambiance is also a part of customer retention policy of reliance retail.
Clean and hygienic environment with properly and well spaced products along with a uniform
color theme attracts the existing customers to the store again and again.
A fast billing system and good and easy grievance handling system which can be accessed thru
customer service desk and company website, ensures that customers feel satisfied with the store
management. Less harassment to customers means better customer retention.
Communication to existing customers takes the form of sms and e-mails, generally sent to
reliance one members. They get information about ongoing offers and also information and latest
news about their nearest stores and the company in general.
Another source of customer database is the information collected during the organizing of special
events in the stores. Customers participating in such events provide their contact information
which are also used in form of database for communication purposes.
Thank you and festive cards on special occasions are an innovative way of communicating with
the customers.
Trained salespersons make customer gratification very easy. A simple thank you with a smile
goes a long way for the store to keep the customers happy.
The special events organized by the stores across india are also a way to gratify the customers by
allowing them to play and win prizes.
Gift vouchers and discount coupons are an attraction for the customers and give them the feel
that the store cares about them and their money.
30
Local customers many a times make limited personal contacts with the store staff just like that
made at a kirana store and help the store to some extent to maintain a relationship with the
customers.
The implementation of the policies brings out certain limitations in them. Few major ones are as
follows
The personal contact numbers of reliance one members are open to tele marketing calls from
various marketers as they leak out of the reliance retails database, causing unnecessary
harassment to customers.
The customer communication policy is less followed in small towns and cities and is more
concentrated towards the metro cities.
There is a common crm policy for both reliance fresh and mart. This should not be the case as
both the stores offer different kinds of merchandize and generally attract different kinds of
customers.
Reliance retail generally delays the processing of permanent membership cards to those
customers who have not paid for such a card. Customers have been waiting for over three
months for their card. Those who have paid the nominal fee of rs. 50 get their permanent card
within 15 days but the rest who have optioned not to pay the fees do not receive the card until too
late.
Unmanned billing counters create long queues at the open counters. This creates impatiens in the
customers as they expect faster billing at the stores and do not want to stand with too much of
goods held in their hands while billing.
Differentiate customers in terms of: (1) their needs and (2) their value to company.
Interact with individual customers to improve the knowledge about individual needs and
to build stronger relationships.
There are four type of analysis done for analysis of CRM
o Periodic Surveys: Its done on quarterly, its an overall survey done by the future
group authorities and CRM is a part of it.
o Customer Loss Rate :
o Mystery Shoppers: They pose as normal customers perform specific taskssuch
as purchasing a product, asking questions, registering complaints or behaving in a
certain way and then provide detailed reports or feedback about their
experiences
o Monitor Competitive Performance
32
Responding -- The response is made clear and appropriate. The customer must
understand the response, and the response must address the issues raised in the
customer's original complaint.
An explanation of decision preserves the goodwill of customer, even if the decision itself
is adverse
33
Weakness:
Unable to meet store opening target so far
34
Opportunity:
Organized retail is just 4.15%of total pie of Indian retail market
Evolving Customer preferences in recent years.
Threat:
Competitors, global big players planning to foray into market
Government policies are not well-defined in India
Unorganized retail market of India
RELIANCE MART
Strengths:
High quality,
latest in-style products,
international shopping experience
value for money pricing
loyal following
Own brand of merchandise, which is both trendy and individualistic.
new introductions every week
variety of designs and styles
exciting mix with a range extending from stylized clothes, footwear and accessories for
men, women and children to well-co-coordinated table linens, artefacts, home accessories
and furnishings.
35
Well-designed interiors, sprawling space, prime locations, lovely coffee shops add to the
customers shopping experience.
Weakness:
Needs to expand faster to maintain market share
Size of the stores should be increased to stock more products.
Targets the middle-class segment. Higher class customers do not prefer west side.
Trent limited may not be able operate west side efficiently due to its other operations.
OPPORTUNITIES:
To survive in todays world globalization is important. Reliance mart have a wide
opportunity to go more global to improve and expand its business.
They also have the opportunity to consider more overseas supplier which will actually
give them cost advantage, rather than suppliers available on a local level.
They also have the opportunity to maximize the use of available technology to improve
their functioning and to gain competitive advantage.
Threats:
If the unorganized retailers are put together, they are parallel to a large supermarket with
no or little overheads, high degree of flexibility in merchandise, display, prices and
turnover.
36
Shopping Culture: Shopping culture has not developed in India as yet. Even now malls
are just a place to hang around with family and friends and largely confined to Windowshopping.
Competition from future group and various other retail stores which are growing rapidly.
INDIAN CONSUMERISM
The lifestyle and profile of the Indian consumer is going through a rapid transformation. The
population of India is young, energetic and full of enthusiasm. 50% of the Indian population is
under the age of 25. There has been a transition from price consideration to quality and design, as
the focus of the customer has changed. The upper and middle- class population of today needs a
feel good experience even if they have to spend a little more for that. People are moving towards
luxury and want to experiment with fashion and technology. There is an increasing need of better
apparels, cars, mobile phones and consumer durables.
ANALYSIS
Q1) What Retail chain do you usually go to?
Reliance mart
Vishal mega mart
Any other
37
Any other
18%
38%
44%
The observation shows that 44 % of people out of 100 person surveyed prefer to go to Vishal
mega mart and only 38 % & 18% prefer to go reliance mart & any other retail outlet respectively.
38
The observation shows that 42 % of people out of 100 person surveyed visits retail stores once in
a month and only 38 % & 20% visits the retail stores twice & thrice in a month respectively.
2500-7500 Rupees
7500-12500 Rupees
9% 5%
52%
34%
The observation shows that 52 % of people out of 100 people surveyed spend Rs 2500-7500 on
shopping in a month. There are only 5% people who spend more then 12500 on shopping out of
100 people surveyed.
39
1/2- 1 hour
1-2 hours
Over 2 hours
9%
12%
49%
30%
The observation shows that 49 % of people out of 100 people surveyed spend 1-2 hours in
shopping mart and 30 % people spend -1 hour on shopping at retail store. There are only 9 %
people who spend more than 2 hours at shopping mart.
With 1 person
2-4 people
20% 4% 25%
51%
The observation shows that 51 % of people out of 100 people surveyed goes along with 2-4
person for shopping & there are only 4 % people who goes for shopping along with more than
four persons...
40
Q6) Please rate the following, according to your personal choice, for both Reliance mart &
Vishal mega mart.
Questions
Reliance mart
Accessories
Household
Lifestyle
Quality of products
5
4
Realince mart
Vishal mega mart
3
2
1
Accessories
Questions
Household
Lifestyle
Reliance mart
Accessories
1
2
41
Household
Lifestyle
Prices of products
5
4
Reliance mart
2
1
0
Accessories
Questions
Household
Lifestyle
Reliance mart
Behaviour
Manners
Helpfulness
1
2
42
Service
Staf
5
4
Realiance mart
Vishal mega mart
3
2
1
Questions
Reliance mart
Promotional offers
Variety of products
1
2
43
Relaince mart
Vishal mega mart
Questions
Reliance mart
Billing Problems
Heavy Rush
2
Personnels lack of
knowledge
Problems faced
5
4
3
2
1
Reliance mart
Vishal mega mart
44
Questions
Reliance mart
People
Ambience
Overall Experience
5
4
3
2
1
0
Products
People
Reliance mart
Ambience
Findings
1. The choice of a store location has a profound effect on the entire business life of a retail
operation. A bad choice may all but guarantee failure, a good choice, and success.
2. Choosing a retail location is, at best, a risky undertaking. Considering the consequences
of choosing a location that proves to be unsuitable, it pays to get as much assistance as
possible. According to a survey more than 60% of the customer prefers to shop in a retail
store which is easily accessible to them.
45
3. Advertising plays a very important role in achieving growth for any retail company. This
is evident from the fact that Advertising by Retail Industry registered a rise of 14 percent
during January - May 2009 over January - May 2008.
4. The right location, trained manpower, software assistance, product with a distinct
differentiation, a strong value proposition, efficient supply chain management - these are
the factors that influence the success of a retail outlet. With competition in this segment
increasing, differentiation and a strong value proposition assume significance. Retail
chains are realizing that they cannot be another me-too store. The differentiation today
among the 5-6 retail chains has come through private labels, which in some cases account
for as much as 70 per cent of the total merchandise in the outlet.
5. Variety offered by any retail store is of very much important to attract all type of
customers in the stores. A large variety of products caters to each segment of customers.
6. Shopping experience within a store also has a great impact on selecting a product from a
particular retail store. Overall ambience includes infrastructure facilities provided by the
store such as air conditioners, lighting etc.
7. Pricing is in fact a dramatic controller of at least 3 key strategic elements to any
company's success: Companys image, the product and services company sells and
consumer behavior. The Importance of Pricing their Products' will give them an insight
into developing appropriate costing methods and the impact of getting it wrong in today's
competitive creative market. This topic should be of interest to anyone who is unsure if
they are getting it right. Remember the difference between over or under-pricing their
work can mean a very short future for any business. Approximately 60% customers think
that Price is the most important factor while they go for shopping in a retail stores
8. Quality in everyday life and business, engineering and manufacturing has a pragmatic
interpretation as the non-inferiority, superiority or usefulness of something. This is the
most common interpretation of the term. The quality of a product or service refers to the
perception of the degree to which the product or service meets the customer's
expectations. Quality has no specific meaning unless related to a specific function and/or
object. Quality is a perceptual, conditional and somewhat subjective attribute. And in
addition to that, more than 90% of customers place quality as the most important factor
than anything else in the list to shop in a retail store.
46
9. More than 70% of customers place variety as an important factor to shop in a particular
retail store.
10. Brands name bears an important role while shopping of any type of goods. So building a
brand for a retail store is important as 80% of customer still prefer to buy branded clothes
in the retail store instead of local or unbranded clothes.
Conclusion
Given the developments and prospects, the Indian retail sector is in its nascent stage of evolution.
While there are obstacles, there are clear opportunities in modern retailing in India. There are
many lessons that India can take from other countries, which have moved along the path of retail
evolution. The retail sector has proved to be of immense significant from macro-economic point
of view. The sectors capability to give strong growth momentum by creating multiplier effects
on other sectors is not in dispute. It is now necessary to cautiously expand and develop the
sector, as the government, at present, has done by permitting partial FDI in the sector. Given the
scope, the retail sector is certainly expected to fetch the long-term economic benefits for the
country.
The convenience and personalized service offered by the unorganized sector holds its future in
good stead for the future. Organized retail of late has seen a tremendous boom and is attracting
more people to the malls.
What is to be seen is how organized retail can duplicate the same level of personalized customer
service levels offered by the unorganized sector to have a higher conversion ratio.
The target audience for both the organized and unorganized retail formats remains relatively the
same. When shopping in malls, people value the experience related to the trip the most and
return most frequently for the same. Besides, while enjoying the experience they seem to buy
high ticket and items of conspicuous consumption most frequently.
47
Gaining and maintaining consumer preference is a battle that is never really won.
Continued and consistent branding initiatives that reinforce the consumers purchase decision
will, over time, land the product in consumer preference sets. Attaining and sustaining preference
is an important step on the road to gaining brand loyalty
Suggestions
1. Include more trained sales person to help customers in the store while shopping.
2. Improve quality of the products especially clothes.
3. Play good songs or soothing music in the store rather than cheap filmy songs.
4. Customer care service can be introduced
5. More branded products can be displayed in the store as people still prefer branded clothes
than offered by local vendors.
6. Constant reminder of discounts through pamphlets, speakers inside the store for inducing
consumers for impulse buying.
7. Add more cosmetic products as its having a huge market of consumers attached to it.
8. Display of product should be improved so that the product is easily visible to the
consumers.
9. Proper advertisement in press and outdoor to make Vishal Mega Mart should be visible in
the eyes of consumers.
10. Should have parking spaces in front of every store.
11. Hire more salesgirls as in ladies section its very difficult for both the consumers and
salesman to interact with each other.
12. Regular training to sales person to improve there overall performance.
13. Customization of clothing should be given an important consideration.
14. Proper packaging and provide contrast labelling in displays of product.
15. Should apply electronic supply chain management for better inventory management.
16. Proper power back up as air conditioners are not working to their full capacity at many
stores.
17. Proper placements of Gondola in the stores as space between them are very less.
48
18. Proper display in the gondola and top most rack of the gondola should be used for storing
of inventory rather than display of product.
19. Should provide more festival schemes and at proper time.
20. Should use psychological pricing-more discounts by increasing the price
21. Proper display of cutlery items
22. Clothes should be in sync with fashion.
BIBILIOGRAPHY
Books referred:
Retailing Management
Pradhan, Swapna
49
Websites:
www.google.com
www.wikipedia.com
www.vishalmegamart.com
www.reliancemart.com
www.indianretailindustry.com
QUESTIONNAIRE
Dear Sir/Madam,
Name:
Age:
Profession:
Sex:
50
With 1 person
2-4 people
More than 4 people
Q6) Please rate the following, according to your personal choice, for both Reliance mart &
Vishal mega mart.
Questions
Reliance mart
Accessories
Household
Lifestyle
Questions
Reliance mart
Accessories
1
2
52
Household
Lifestyle
Questions
Reliance mart
Behaviour
Manners
Helpfulness
Service
1
2
Questions
Reliance mart
53
Promotional offers
Variety of products
Questions
Reliance mart
Billing Problems
Heavy Rush
2
Personnels lack of
knowledge
2
Questions
People
1
2
Reliance mart
3
54
Ambience
1
2
55