1. INTRODUCTION To retail Industry .

RETAIL INDUSTRY In the Indian retailing industry, food is the most dominating sector and is growing at a rate of 9% annually. India retail industry is progressing well and for this to continue retailers as well as the Indian government will have to make a combined effort. The branded food industry is trying to enter the India retail industry and convert Indian consumers to branded food. Since at present 60% of the Indian grocery basket consists of non- branded items. India retail industry is expanding itself most aggressively; as a result a great demand for real estate is being created. Indian retailers preferred

means of expansion is to expand to other regions and to increase the number of their outlets in a city. It is expected that by 2010, India may have 600 new shopping centers. The Indian retail market, which is the fifth largest retail destination globally, according to industry estimates is estimated to grow from the US$ 330 billion in 2007 to US$ 427 billion by 2010 and US$ 637 billion by 2015. Simultaneously, modern retail is likely to increase its share in the total retail market to 22 per cent by 2010. Continuing the robust growth of the organized retail in India, according to the Credit Rating and Information Services of India, the industry raked in US$ 25.44 billion turnover in 2007-08 as against US$ 16.99 billion in 200607, a whopping growth rate of 49.73 per cent.

India retail industry is the largest industry in India, with an employment of around 8% and contributing to over 10% of the country's GDP. Retail industry in India is expected to rise 25% yearly being driven by strong income growth, changing lifestyles, and favorable demographic patterns.

"The story is not about us, but this story is about the people who visit our stores. This is a proud moment for India."

One of the biggest retail here in India we know is Kishore Biyanis big bazaar. The company ended 2007-08 with Rs5048crore in revenue. Biyani's and Big Bazaar's, march comes at a time when several new retailers are slowing expansion, reducing the number of outlets, effecting

layoffs, even exiting the business.

By 2011, he claims, there will be 300 Big Bazaars, and Pantaloon Retail (India) Ltd, his flagship, will have revenue of Rs13000crore.

Thus here we will know about the company profile, operations and also about the consumer behavior towards the schemes, discount, etc which are offered by the store to facilitate customers.

PRODUCT LINE Here, one finds over 170,000 products under one roof that cater to every need of a family, making Star Bazaar Indias favorite shopping destination. Where STAR Bazaar scores over other stores is its value for money proposition for the Indian customers. Star Bazaar, one finds a huge variety of products to select from with a good price and quality. With the ever increasing array of private labels, it has opened the doors into the world of fashion and general merchandise including home furnishings, utensils, crockery, cutlery, sports goods and much more at surprisingly low prices. In recent years, Star Bazaar has adopted value pricing in which they win loyal customers by charging a fairly low price for a high quality offering. However, consistent low price for the products is not only the universally desired characteristic.

Pricing Strategy Beginning Star Bazaar for a shopping spree

Hypermarkets offer customers a value equation that includes quality and convenience in an unbeatable combination Hypermarkets like Star Bazaar are changing the way people shop for their groceries and household essentials. People who used to visit the local shops and vegetable markets frequently are now buying at hypermarkets such as Star Bazaar that offer customers a variety of products at affordable prices, in a comfortable environment. But while affordability is a big factor for customers, they also seek value and quality which they know they will get at Star Bazaar, a Tata enterprise.

The uniqueness of each Star Bazaar store lies in the size and spread of its merchandise range. Shoppers can select from a large range of staples, fresh goods, apparel, luggage, consumer durables, household products and much more and also enjoy the benefit of generous reductions on the market rate. "A customer who is buying in a hypermarket is, in his mind, comparing it with what is available elsewhere. There is always in the customers mind a value equation and we have to be able to deliver that," says Neeti Chopra, head, marketing, Trent. The stores stock goods according to regional customer preferences, as customers in different regions favour different essentials. For instance, in Gujarat, people tend to stock up on their pulses whereas in northern India, basmati rice is a big item. Star Bazaar is aware that people today look at value as a critical component while shopping. And that the first visit may be put down to curiosity, but customers will keep coming back only if they are satisfied with the choices, the quality and the value of the products on sale. So the big focus is on understanding its customers who they are, what they want, what is relevant to them, and how to package it in a manner that makes the store more attractive to them. Regionalism also comes into play in the back end of the retail operation Star Bazaar has tied up with local and regional vendors for supplies and transportation of goods. The chain will focus largely on the metros; by year 2010, the chain hopes to

have 20-25 stores across the country.

PRICING: Pricing is basically setting a specific price for a product or service offered. In a simplistic to the concept of price as the amount of money that customers have to pay to obtain the product. Setting a price is not something simple. Normally it has been taken as a general law that a low price will attract more customers. It is not a valid argument as customers do not respond to price alone; they respond to value so a lower price does not necessarily mean expanded sales if the product is not fulfilling the expectation of the customers Generally pricing strategy under marketing mix analysis is divided into two parts: price determination and price administration (ibid). Price determination is referred to as the processes and activities employed to arrive at a price for a product including consideration of relative prices of products within the same line, and differences in price for similar products of differing grades and qualities. Price administration is referred to as the activities involved in fitting basic prices to particular sales situations such as geographic locale, functions performed by customers, position of distribution channel members, or special sales situations.

MARKETING STRATEGY

PROCESS FOLLOWED Segmentation, targeting, and positioning together comprise a three stage process. a. Determine which kinds of customers exist, b. Select which ones we are best off trying to serve, c. Implement our segmentation by optimizing our products/services for that segment and communicating that we have made the choice to distinguish ourselves that way. SEGMENTATION: Segmentation involves finding out what kinds of consumers with different needs exist. In the auto market, for example, some consumers demand speed and performance, while others are much more concerned about roominess and safety. In general, it holds true that You cant be all things to all people, and experience has demonstrated that firms that specialize in meeting the needs of one group of consumers over another tend to be more profitable. Several different kinds of variables can be used for segmentation:1. Demographic variables essentially refer to personal statistics such as income, gender, education, location (rural vs. urban, East vs. West), ethnicity, and family size. Campbells soup, for instance, has found that Western U.S. consumers on the average prefer spicier soups thus, you get a different product in the same cans at the East and West coasts. Facing flat sales of guns in the traditional male dominated market, a manufacturer came out with the Lady Remmington, a more

compact, handier gun more attractive to women. Taking this a step farther, it is also possible to segment on lifestyle and values. 2. Some consumers want to be seen as similar to others, while a different segment wants to stand apart from the crowd.

3. Another basis for segmentation is behavior. Some consumers are brand loyali.e. they tend to stick with their preferred brands even when a competing one is on sale. Some consumers are heavy users while others are light users. For example, research conducted by the wine industry shows that some 80% of the product is consumed by 20% of the consumerspresumably a rather intoxicated group.

4. One can also segment on benefits sought, essentially bypassing demographic explanatory variables. Some consumers, for example, like scented soap (a segment likely to be attracted to brands such as Irish Spring), while others prefer the clean feeling of unscented soap (the Ivory segment). Some consumers use toothpaste primarily to promote oral health, while another segment is more interested in breathe freshening.

TARGETING:

1. In the next step, we decide to target one or more segments. Our choice should generally depend on several factors:First

How well are existing segments served by other manufacturers? It will be more difficult to appeal to a segment that is already well served than to one whose needs are not currently being served well.

Secondly How large is the segment, and how can we expect it to grow?

Thirdly Do we have strengths as a company that will help us appeal particularly to one group of consumers?

2. Star Bazaar targets higher and upper middle class customers. 3. The large and growing young working population is a preferred customer segment. 4. StarBazaar specifically targets working women and home makers who are the primary decision makers. It is part of Star Bazaars new Guerrilla Marketing Strategy. 5. Guerrilla force is divided into small groups that selectively attack the target at its weak points. Guerilla marketing is just one of the strategies and surely one can learn a lot from the ongoing battle, especially people interested in marketing/marketing techniques. POSITIONING:

Positioning involves implementing our targeting. For example, Apple Computer has chosen to position itself as a maker of user-friendly computers.

RETAIL MIX: 1. Merchandise assortment The company was looking for a solution that would bring all of its businesses and processes together. After a comprehensive evaluation of different options and software companies, the management at Pantaloon decided to go in for SAP. Some of the qualities of SAP retail solutions are that it supports product development, which includes ideation, trend analysis, and collaboration with partners in the supply chain; sourcing and procurement, which involves working with manufacturers to fulfil orders according to strategic merchandising plans and optimise cost, quality, and speedvariables that must be weighted differently as business needs, buying plans, and market demand patterns change; managing the supply chain, which involves handling the logistics of moving finished goods from the source into stores and overseeing global trade and procurement requirements; selling goods across a variety of channels to customers, which requires marketing and brand management; managing mark-downs and capturing customer reactions, analysing data, and using it to optimise the next phase of the design process. 2. Place In the channels of distribution, the physical facilities point of location. 3. Price 4. Visual merchandising Visual merchandising supports:a. sales

b. retail strategies c. communicates with customers d. communicates image e. supports retailing trends. Visual merchandising includes:1. Interior merchandising Sufficient visual merchandizing within the store that included danglers, signage, standees, distribution of pamphlets, which gave details of the offer. Display, point of purchase, fixture, equipment and furnishings store layout. Product packaging and labels. 2. Exterior merchandising TVC on popular entertainment channels like Star Plus, Sony, Set Max, and Star One. Road shows carried out by the Big Bazaar staff with announcements about the offer to make people aware. Newspaper ads in almost all the local dailies like Sakal, The Times of India, on different days during the period of the offer. Store atmosphere.

8. SUPPLY CHAIN: Supply chain, is a coordinated system of organizations, people, activities, information and resources involved in moving a product or service in physical or virtual manner from supplier to customer. Supply chain activities transform raw materials and components into a finished product that is delivered to the end customer.

COMPETITORS Star bazaar operates in a competitive environment. For each line of business, they face competition from established national and regional companies. In the fashion segment, they probably face competition from Shoppers Stop, Trent and Lifestyle. The hypermarket business is relatively new, being just about three to four years old in the country. Star bazaar faces competition from the likes of RPG (Spencers), and with Shoppers Stop too indicating their entry into the hypermarket segment. In the Food business, Star Bazaar faces competition from Subhiksha, Food World to name a few. a. RPG GROUP: Spencer & CompanyLimited is another large retail group in the country withsupermarkets,music stores, and the beauty and health chainHealth & Glow. Food world, operated by Food World Supermarkets Limited, while Health &Glow by the RPG Group. It is also Planning IPO, will have 450plus Music World, 50-plus Spencer's Hyper covering 4 mn sq.ft by 2010.

b.KRAHEJAS DEPARTMENTSTORE CHAIN:

K Rahejas Shoppers Stop, is the second largest retailer in the country and became in retailing operation an Indian success story. It also acquired the Crossword chain of bookstores. It Operates Shoppers Stop, Crossword, In orbit Mall, and 'Home

Stop' formats. Will operate 55 hyper city hypermarkets with US$100 million sales across India by 2015. c.SUBHIKSHA SUPERMARKET: Subhiksha was immensely popular in the South, particularly in Chennai, where it sold groceries and pharmaceutical products below the MRP. It expected to earn a total turnover of Rs 1,200 crore in 200809 as it planned to expand outside Tamil Nadu and Pondicherry. It planned for 550 stores in the next five years.

d. RELIANCE RETAIL:

Investing Rs.30000 crore ($6.67 billion) in setting up multiple retail formats with expected sales of Rs.90,000 crore-plus ($20 billion) by 2009-10.

e. LIFESTYLE:

Investing Rs.400 crore-plus ($90 mn) in next five years on Max Hypermarkets & value retail stores, home and lifestyle centers.

f. PIRAMYD RETAIL:

Aiming to occupy 1.75 million sq.ft retail space through 150

stores in next five years.

BUYING PROCESS a. NEED RECOGNITION: The customer first points out the things which he need. His good part of income is spend on things of his daily requirement. b. INFORMATION SEARCH: Before purchasing of a product, customer research internally and externally. Internally-retrieving information about similar purchase made earlier, decision about choice criteria, brand included, or advertisement related to the product. Externally- source such as family, friends, commercial sources, etc. c. EVALUATION OF ALTERNATIVES: Before, purchasing customer looks for the alternatives of that product. Customer goes for good quality in cheapest rate. d. PURCHASES: Purchaser many times faces cognitive dissonance which arises due to uncertainty of making right decision. This is because choice of one product often means rejection of attractive features of the alternatives.

e. AFTER PURCHASE EVALUATION: Customer by using the product comes to know about the real value of product.

CONCLUSION:

It should be considered that big bazaar targets every class. Thus we know that different people have different thinking style. Most of their buying decisions or his behavior depends on his:a. PERCEPTION: Perception is the process by which a customer makes sense of information that he receives. Therefore, it is to be tried that customer receives the right information about every product and about its scheme, because a single error in communication to customer can create confusion to him and he may not buy the product. b. LEARNING: It is the change in the content or organization of long time memory and is a result of information processing. Thus company should try to hit the customers memory. I.e. Company should have good impression on the memory of the customer. As this memory acts as a internal information source in the decision making process. c. MOTIVATION: Motivation helps a lot to maintain loyal customers. A customer is loyal only when he sees any extra benefits. Thus discounts, free gifts, free coupons, etc such schemes motivate them a lot. Many times, good quality of the product, reasonable prices, packaging, etc also works as motivational tool.

d. PERSONALITY:

Personality can be of many types as introvert-extrovert, sociableloner, and competitive-cooperative. Brand personality is the

characterization of brands as perceived by customers. Brand may be as for young like branded jeans of Levis, Lee, Woodland, etc. Big bazaar also target same concept.

e.

CUSTOMER LOYALITY AND PROFITABILITY:

Relationship between loyalty and profitability should be decided on the basis of loyal customers that are really profitable for company. The loyal customers are believed to be cost less to serve, they are willing to pay more than other customers and act as a wordof- mouth promoters for the company. It is believed that one sure way to earn greater profits is to win loyalty of customers. TO GET THE RIGHT POSITIONING PRODUCT UNDER SCHEME: DONE OF THE

It is the customers beliefs about the companys product being of, say, high quality, or low price, or durable, etc. Thus it is very necessary that product should be according to the customers need. It should not be damaged, in store product should be given open facing. For pack of two the products were given alternate 4 facing. I.e., one row of single and other row of double

TO MAINTAIN STOCK ON THE FLOOR: In retail stores less stock is maintained. This stock on other hand is sufficient enough to fulfill the demand of that vary product in store. To know the exact amount to be maintained on floor it is very necessary to know:a. Product facing b. Capability to maintain stock in warehouse c. Demand of the product. d. Profit margin on the product. 5.3.4. TO UPDATE THE PRICES: Pack of two was the new scheme, so its prices to be get changed on rem for those products whose prices have changed by the producing company. The work was to report DM or team leader about the increase in prices and get it updated on rem so that discount could be given accordingly. 5.3.5. DISCOUNT CRITERION: a. The discount was given on the scheme of pack of two. b. The discount was 1/4th on the profit of the retail company. c. I. e if the company is getting profit of rs10 on a product, whose mrp is 100. d. Then after discount it is sold at rs97.5 in the store.

5.3.6. INVENTORY CONTROL: Since inventory represents cost, managers seek stock minimization. To always have in stock every conceivable item that a customer might order would normally be prohibitively expensive for companies marketing many items.

One solution is to separate items into those that are in high demand and those that are is slow moving. Two related inventory decisions are knowing when and how much to order so that stocks are replenished. This is because there is a lead time between ordering and receiving inventory, and there should not be stock out as the company is waiting for the order items to arrive. The more variable the lead time and higher will be the safety or buffer stock that the company will be required to keep to prevent a stock out.

At the store (Lucknow) I saw this problem many times with many of the products. The stock order placed should be more in the starting of the month as at that time customers purchasing power is more. But I usually saw that order placed was somewhat same throughout the month due to which there was stock out in some of the items in food.

HOW TO WORK ON BARCODE TENDER: Barcodes are the labels which shows price of product after giving the discount on that product. Bar tender is the software by which we use to take out the bar codes. Process:a. To select items according to their EAN numbers export exit enter. b. No. of quantity done. select the items; Include for

c. now go to next program of print ok

EMPLOYMENT GENERATION:

Finally, but most importantly, the employment generated by organized retail is building a quality labour class that is gaining vocational training in skilled and unskilled jobs at the graduate and tenth class level Foreseeing the demand for trained staff, leading organized retailers are creating their captive human resources pool through internal

COMPETITORS STRATEGY: Subhiksha Value

Low-price high-volume strategy: by keeping no fancy frills frontend and by becoming an intermediary at the back end, Subhiksha leverages on discounted prices on bulk purchases and cash payments.

Trent Limited Lifestyle & Value

Single- brand strategy: leverages on high margins in private labels, and targets consumers in socio-economic class B and C.

ITC Choupal Sagar & Choupal Fresh Value

Backward integration through IT-based business model: leverages by building direct relationship with the supply source, the farmers, to sell as well as purchase products and services.

Spencers Retail Value

The duck and the duckling model: by having two- or three- value segment stores, backed by a cluster of small-sized Fresh, Daily, and Express stores, to leverage on economies of scale at back-end value chain.

NDDB: Mother Dairy Value Operates on a co-operative model with the objective of increasing farmers welfare. Has a strong presence in Delhis NCR region. Strategically located in residential areas and follows a low-price strategy for fruit and vegetables.

Sources of Conflict Personal/ Role Conflict: conflict between whattheir job requires and their own personalities,self perceptions, and beliefs Organization/ Client Conflict: dilemma of whether they should follow the companys rulesor satisfy customer demands. Interclient Conflict: conflict between customers.Eg: speaking o mobile phone in a cinema hall,noisy guests in a restaurant

Pricing VALUE PRICING (EDLP) PROMOTIONAL PRICING - LOW INTEREST FINANCING - PSYCHOLOGICAL DISCOUNTING

- SPECIAL EVENT PRICING (GUDI PADVA) DIFFERENTIATED PRICING - TIME PRICING BUNDLING

PEOPLE
Well Trained Staff Appearance Empowered Individual Encouraged To Think Out Of The Box Employ close to 10,000 people and recruit nearly 500 additional people every month

 Use Scenario Planning as a tool for Quick Decision Making Security Gaurds At All Gates

Strength - High Brand Equity - State-of-art infrastructure - EDLP - PoP promotions - Variety of stuff

Weakness
- Unable to meet store opening targets - Falling revenue/sq. ft. - General perception

under single roof

Opportunity
- Organized retail (4.15%) - Evolving consumer preferences

Threat
- Competitors - Government policies - Unorganized retail

The Critical Importance Of Service Employees Key focus on customer contact service employees because: They are the service They are the organization in customers eye They are the brand They are the marketers Their importance is evident in: The Services Marketing Mix (People) The Service-Profit Chain The Services Triangle

The Service Triangle

Sources of Conflict Personal/ Role Conflict: conflict between what their job requires and their own personalities, self perceptions, and beliefs Organization/ Client Conflict: dilemma of whether they should follow the companys rules or satisfy customer demands. Interclient Conflict: conflict between customers. Eg: speaking o mobile phone in a cinema hall, noisy guests in a restaurant

TARGET AUDIENCE: Star Bazaar targets higher and upper middle class customers The large and growing young working population is a preferred customer segment Targets specifically working women and home makers who are the primary decision makers

CORE VALUES:

 Indian ness: Confidence in ourselves Leadership: To be a leader, both in thought and business Respect&Humility: To respect every Individual and be humble in conduct Introspection: Leading to purposeful thinking Openness: To be open and receptive to new ideas, knowledge and information Valuing and Nurturing relationship: To build and maintain long term relationships Simplicity&Positivety: Simplicity and positive approach in though, business and actions Adaptability: To be flexible and adaptable, to meet challenges

STAR BAZAAR-USP: 1Billion population. Availability of Liquid Cash \Disposable Income among Young Generation Affordable man power Craze, Passion among Mr. Customer (Consumer) More products .Under ONE roof

 Affordable price Sentiments -To infuse confidence in Indian brands Schemes-Buy 01 gets one free, 20% dis...etc

STRATEGIES:

To minimize Retailing cost: Operating: Fewer staff on the floor-one person for every 500 sq ft Minimize the Furniture cost Sourcing: Cut Down 25-30 % Channel-Cut Down 15-20% Saving Shelf Space Way to deal unsold stock off Plans to have In-Store promotions as well slow-moving products off To ensure enough pull to snatch away customers from the neighborhood

OPPURTUNITIES: Early Entry in Indian Retail Organized retail Evolving consumer preferences Targeting area more prone to developments Global Expansion In-Store Experience improvements

THREATS: Government policies like complex sales and excise policies. Unorganized retail. Large Foreign Competitors like Wal-Mart, Metro and Domestic player like Reliance. Burgeoning real estate prices which leads to high rentals. Economic Conditions Lowering Margins OPPURTUNITIES: Early Entry in Indian Retail Organized retail Evolving consumer preferences Targeting area more prone to developments Global Expansion In-Store Experience improvements

THREATS:

 Government policies like complex sales and excise policies. Unorganized retail. Large Foreign Competitors like Wal-Mart, Metro and Domestic player like Reliance. Burgeoning real estate prices which leads to high rentals. Economic Conditions Lowering Margins

PEST ANALYSIS:

Political and Legal Factors: A stable government at the centre will facilitate speedy economic recovery and create an encouraging investment climate Problems of getting subsidy from Octrai and on different taxes like land, water taxes Problems of taking over properties and real estate

Economical: India, one of the fastest growing economies(6-6.5% GDP growth rate) Retail Industry to grow to 300 billion by 2010 Increase in the percentage contribution of the service sector to GDP

 Increase in the investment on IT with focus on cost minimization

Socio-Cultural Factors: Increase in Nuclear families People prefer to shop in local stores with the reasonable prices Increase in working womens proposition Life style changes Shift in Product and service preferences Increase in Young population

Technological: Technological development for fast billing and the service Better applications of information technology in the modern retail industry, like in supply chain management, store management, point of sale and customer relationship management

CORE COMPETENCIES:
A choice of more than 20,000 products Delivery across more than 1500 cities and towns in India covering around 16,000 pin codes Fast deliveries tie ups with world leaders in logistics & transportation services

 A dedicated Customer Care helpline for any queries Always offering Manufacturers guarantee as opposed to Sellers guarantee, which most of the other online shopping sites offers Talks of Quality and Cost Special emphasis on apparels and life style products Providing interesting discounts

RECOMMENDATIONS:

Retailing through Internet & web based technologies. Star Bazaar needs to focus more on Customer Relationship Management {CRM} and improved in-store assistance (Building loyal customers base and developing a more profitable loyalty cycle). Customer Care Centre to guide and counsel about customer loyalty program. Training must be provided to sales personnel not only of their counters but for other functions also. Job rotation and training will enhance their knowledge, job profile and boost the morale of employees to effectively perform their duties and the responsibilities. Stress Buster Exercises must be organized during evenings in sessions as employees have to stand all throughout the day.

 More hoardings could be placed that could bring awareness to people (at metro station). More brands should be included. Exchange offers must be made clear as the consumers are often not clear about how to use them. Seating arrangements must be made for customers as well as for employees also. Customers usually face problem in billing their purchased goods. Waiting in long queues forces them to leave certain products thereby loss of sale to Star Bazaar. So billing counters must be increased and employees at the billing should be given training so that they could bill the products in much lesser time and the people at the billing stations should have the information about the special offers and the events that are being conducted at the store so that the customer inflow can be accordingly handled. Care to be taken to maintain proper inventory levels and the varieties and offer the customer what is needed rather than offering what is available.(Brands like Nike, Adidas, Reebok,etc) Invest in supply chain infrastructure Ease distribution infrastructure creation

 Aggressive expansive plans in II tier cities will open up new world of opportunities Added on facilities like Home Delivery and to an extent credit it plays an important role in Customer Acquisition and retention programs. Offer most exclusive brands under all categories