Pantaloon Retail India PRJT

8/7/2019 Pantaloon Retail India PRJT

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PANTALOON RETAIL INDIA (LIMITED)

PROJECT REPORT

CONSUMER INTRECTION & CONSUMER SERVICE

KRISHNA PAL VERMA

8/27/2009


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Guided By

Mr. UMESH PANDAY,DM

Submitted by

KRISHNA PAL VERMA

JPPGDM-080121

Contect no.-09452967144

J.P. Institute of Management

Meerut


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Distribuyion Channel


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Board of directors

Mr. Kishore Biyani, Managing Director

Kishore Biyani is the Managing Director of Pantaloon Retail (India) Limitedand the Group Chief Executive Officer of Future Group. To know more.


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Mr. Gopikishan Biyani, Wholetime Director

Gopikishan Biyani, is a commerce graduate and has more than twenty years ofexperience in the textile business.

Mr. Rakesh Biyani, Wholetime Director

Rakesh Biyani, is a commerce graduate and has been actively involved in

category management; retail stores operations, IT and exports. He has beeninstrumental in the implementation of the various new retail formats.

Mr. Vijay Kumar Chopra, Independent Director

V.K.Chopra is a fellow member of The Institute of Chartered Accountants ofIndia (ICAI) by profession and is a Certified Associate of Indian Institute of

Bankers (CAIIB). His banking career spans over 31 years and he has served

senior management positions in Central Bank of India, Oriental Bank ofCommerce, SIDBI, Corporation Bank and SEBI.

Mr. Shailesh Haribhakti, Independent Director

Shri Shailesh Haribhakti, is a Chartered Accountant, Cost Accountant, and aCertified Internal Auditor. He is the Deputy Managing Partner of Haribhakti& Co., Chartered Accountants and past president of Indian merchant

Chambers. He is on the Board of several Public Limited Companies, includingIndian Petrochemicals Corporation Ltd., Ambuja Cement Eastern Ltd. etc. Heis on the Board of Company since June 1, 1999.

Mr. S Doreswamy, Independent Director

S. Doreswamy, is a former Chairman and Managing Director of Central Bank

of India and serves on the board of DSP Merrill Lynch Trustee Co and CeatLimited among others.

Dr. D O Koshy, Independent Director


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D. O. Koshy, holds a doctorate from IIT, Delhi and is the Director of NationalInstitute of Design (NID), Ahmedabad. He has over 24 years of rich

experience in the textiles and garment industry and was instrumental in the

setting up of NIFT centres in Delhi, Chennai and Bangalore. He is a renownedconsultant specializing in international marketing and apparel retail

management.

Ms. Bala Deshpande, Independent Director

Bala Deshpande, is Independent Director, Pantaloon Retail (India) Ltd. and alsoserves on the boards of Deccan Aviation, Nagarjuna Construction, Welspun

India and Indus League Clothing Ltd, among others.

Mr. Anil Harish, Independent Director

Anil Harish, is the partner of DM Harish & Co. Associates & Solicitors and anLLM from University of Miami. He also serves on the board of Mahindra

Gesco, Unitech, IndusInd Bank and Hinduja TMT, among others.


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Specialized besinesses


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CONTENTS

y Acknowledgement

y Preface

y

Ex

ecutive Summaryy Objective of the project

y Research Methodology

y CompanyProfile

y MarketingPlan

y Management Hierarchy

y Findings AndAnalysis

y Limitation

y Suggestions/Recommendations

y Bibliography

y Questionnaire


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ACKNOWLEDGEMENT

A work is never a work of an individual. We owe a sense of gratitude to

the intelligence and co-operation of those people who had been so easy to let us

understand what we needed from time to time for completion of thi s exclusive

project.

We want to express our gratitude towards Mrs. Ismeet dheer ,HR,

Pantaloons :: DT City Center:: Delhi ,for giving us an opportunity to do this

project. Last but not the least, we would like to forward our gratitude to

Mr.Avnish pariyar, store head,Mr.Umesh Panday,DM Internet & J.P.

Institute of Management College. Meerut. who always endured us and stood

by us and without whom we could not have envisaged the completion of our

project.

KRISHNA PAL VERMA

PGDM (2nd

YEAR)


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PREFACE

Business,theworld over are struggling to suction conpetitiveness in a

rapidly globling economy. The boundaries of traditional trade partner are

getting dissolved and emerging market present future opportunities as well as

new rivals. In such competitive global environment, it is imperative for every

organization to generate the highest level of customer satisfaction. To attain

these objectives, it has become necessary for the organization to look for the

high skilled and employee according to job.

These days, corporate across the world are facing a difficult task of

Customer interaction. Retaining its best employees, a company can improve

customer satisfaction, product sales etc. in other words a business can be

improve in all over direction.

Future group is a reputed company; future group brand store such as life

style, shoppers stop, etc..Pantaloons store sailing many home brand

international brand for man casuals and formals and also for kids and ladies.

During working on this project I have observed how the pantaloon store because

they perform our job very honestly and they maintain the section perfectly.


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Major Milestones

1987 Company incorporated as Manz Wear Private Limited. Launch ofPantaloons trouser, Indias first formal trouser brand.

1991 Launch of BARE, the Indian jeans brand.

1992 Initial public offer (IPO) was made in the month of May.

1994 The Pantaloon Shoppe exclusive menswear store in franchisee

format launched across the nation. The company starts thedistribution of branded garments through multi -brand retail outletsacross the nation.

1995 John Miller Formal shirt brand launched.

1997 Pantaloons Indias family store launched in Kolkata.

2001 Big Bazaar, Is se sasta aur accha kahi nahin - Indias first

hypermarket chain launched.

2002 Food Bazaar, the supermarket chain is launched.

2004 Central Shop, Eat, Celebrate In The Heart Of Our City - Indias

first seamless mall is launched in Bangalore.

2005 Fashion Station - the popular fashion chain is launched

aLL a little larger - exclusive stores for plus-size

individuals is launched

2006 Future Capital Holdings, the companys financial arm launches realestate funds Kshitij and Horizon and private equity fund Indivision.

Plans forays into insurance and consumer credit.

Multiple retail formats including Collection i, Furniture Bazaar, Shoe

Factory, EZone, Depot and futurebazaar.com are launched across thenation.

Group enters into joint venture agreements with Generali.


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What is Pantaloons ?

Celebrate the Fresh Look, Fresh Feel & Fresh Attitude at Pantaloons Fresh

Fashion !

Fashion is all about the now. Why, then should people not see a fresh look

every time they walk into a Pantaloons store? That is the thought behind

'Fresh Fashion'. An idea that has captured the imagination of young India.

With a focus on the youth of today, Pantaloons offers trendy and hip

fashion that defines the hopes and aspirations of this demography.

Pantaloons Fresh Fashion stands out as a fashion trendsetter, on the lines

of how fashion is followed internationally. The look and whats in today

for the season is sacrosanct.

Pantaloons takes its promise of 'fresh fashion' very seriously making

available to its customers the latest in fashion every week!

All Pantaloons stores reflect the new ideology -- Fresh Feeling, Fresh

Attitude, Fresh Fashion. The stores offer fresh collections and are visually

stimulating thanks to appealing interiors and attractive product display!

The first Pantaloons was opened in Gariahat in 1997. Over the years, it has

undergone several transitions. When it was first launched, this store mostly

sold external brands. Gradually, it started retailing a mix of externalbrands while at the same time introduced its own private brands. Initially

positioned as a family store, it finally veered towards becoming a fashion

store with an emphasis on 'youth' and clear focus on fresh fashion.

Today, the fashion store extends to almost all the major cities across

the country. Pantaloons has established its presence with stores not just in

the metros, but also in smaller towns.

Pantaloons stores have a wide variety of categories like casualwear,

ethnicwear, formalwear, partywear and sportswear for Men, Women and

Kids


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Images Fashion Forum 2009

Most Admired Fashion Group Of The Year - Future Group

Most Admired Private Label - Pantaloons, the lifestyle format

Critics Choice For Pioneering Effort In Retail ConceptCreation - Central

Coca-Cola Golden Spoon Awards 2009

Most Admired Food & Grocery Retailer Of The Year

Most Admired Food Court

Most Admired Food Professional

2008

Indian Retail Forum Awards 2008

Most Admired Retail Company of the year - Future Group

Retail Face of the Year - Kishore Biyani

Best Retailer Of The Year ( Hypermarket) - Big Bazaar

Future Group was awarded the Most Admired Retail Company of the year by

the Indian Retail Forum at a glittering ceremony organised in Mumbai. Mr

Kishore Biyani also won Retail Face of the Year.

India Retail Forum (IRF) is a platform for intellectual insights and

information exchange for the retail business in the Indian subcontinent. Theforum presents the business of retail in the region to a global audience, with

the express aim of facilitating understanding about and encouraginginvestment in this massive marketplace.

Big Bazaar, the value format of Future Group bagged the Best Retailer OfThe Year ( Hypermarket).

The INDIASTAR Award 2008

Food Bazaar: Best Packaging Innovation

Food Bazaar bagged the INDIASTAR Award for Best Packaging Innovation

in India, for its private label brand Fresh And Pure Chakki Atta.

INDIASTAR Award is a biennial event which aims to promote and


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encourage excellence in packaging design, innovation and t echnology. Thecontest was established in 1972 and is considered as the most popular and

premier event for Indias packaging fraternity. This year there were around357 entries and the participants had to submit a sample of their designs for

selection.

With this award, Pantaloon Retail (India) Limited becomes the first IndianRetailer to win the prestigious INDIASTAR Award.

Retail Asia Pacific 500 Top Awards 2008

Gold Winner -Top Retailer 2008 Asia Pacific

Retail Asia Publishing Pte, the institutor of these awards, aims to set a

platform that appraise, raises and recognizes the development and growth of

retailing throughout the Asia Pacific region.

Coca-Cola Golden Spoon Awards 2008

Most Admired Food & Grocery Retail Visionary of the Year: KishoreBiyani

Most Admired Food & Grocery Retailer of the Year Supermarkets:Food Bazaar

Most Admired Food & Grocery Retailer of the Year - Hypermarkets: BigBazaar

Most Admired Retailer of the Year - Dynamic Growth in NetworkExpansion across Food, Beverages & Grocery: Future Group

Most Admired Food & Grocery Retailer of the Year - Consumer's Choice:Big Bazaar

The Coca-Cola Golden Spoon Awards 2008, were given away for the first

time as a culmination of the Food Forum India 2008 a two dayconvention, which saw the participation of leading brands, retailers & retail

support organizations from across the globe. The awards were presented to

honour enterprise, innovation and achievement in the food retailing businessas a benchmark of excellence.

The Reid & Taylor Awards For Retail Excellence 2008

Retail Leadership Award: Kishore Biyani

Retail Best Employer of the Year: Future Group


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Retailer of The Year: Home Products and Office Improvements:HomeTown

The Reid & Taylor Awards for Retail Excellence are an important feature of

the Asia Retail Congress, Asias single most important global platform to

promote world-class retail practices. These awards are aimed at honouringthe best, in the Asian Retail scenario. India played host to Asia RetailCongress 2008.

2007

Images Retail Awards

Most Admired Retail Face of the Year: Kishore Biyani

Most admired retailer of the year: Large format, multi product store: BigBazaar

Most admired retailer of the year: Food and Grocery: Food Bazaar

Most admired retailer of the year: Home & office improvement: HomeTown

Most admired Retail Company of the year: Pantaloon Retail (India) Ltd.

Images Retail Forum followed strict international benchmarks in decidingthe top honours for Images Retail Awards 07, with IRIS as knowledgepartner and global consulting firm AT Kearney as the Process Approver .

National Retail Federation Awards

International Retailer for the Year 2007 Pantaloon Retail (India) Ltd

The National Retail Federation is the worlds largest retail trade

association with over 1.4 million members in the US and across theworld. Some of the past winners of the award include Metro AG

(Germany), Carrefour (France), Zara (Spain), Boticario (Brazil) and ItoYokado (Japan). The award was presented at the Retails Big Show held

in January 2007 in New York.

World Retail Congress Awards

Emerging Market Retailer of the Year 2007 Pantaloon Retail (India) Ltd

The inaugural World Retail Congress held in Barcelona, Spain in March2007 attracted over one thousand retail professionals from over sixtycountries. The awards were decided by a multinational Grand Jury.


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Winners in other categories included Inditex, Mall of Emirates, Marks &Spencer and IKEA.

Hewitt Best Employers 2007

Best Employers in India (Rank 14th) Pantaloon Retail (India) Ltd

Leading human resources consultancy, Hewitt Associates conducts an

annual survey of the best employers in India, as part of its globalinitiative. It is based on CEO interview, People Practices Inventory and

Employee Opinion Surveys. Pantaloon Retail became the only retailer tofeature among the twenty-five best employers in India.

PC World Indian Website Awards

Best Indian Website In The Shopping Category - Futurebazaar.com

PC World, a leading consumer technology magazine selected the bestIndian websites in various categories based on use of technology for

delivering solutions, information being presented in an intuitive a ndconcise manner and overall experience aided by design.

Readers Digest Trusted Brands Platinum Awards

Trusted Brands Platinum Award (Supermarket Category) Big Bazaar

The Readers Digest awards are based on surveys done among consumersby independent research agency, Nielsen Media Research. This is thesecond consecutive time Big Bazaar has won this award.

2006

Retail Asia Pacific Top 500 Awards

Asia Pacific Best of the Best Retailers Pantaloon Retail (India) Ltd

Best Retailer in India Pantaloon Retail (India) Ltd

The Retail Asia publication in association with EuroMonitor and KPMG

honours the best retailers in 14 countries across the Asia Pacific region.The awards were presented in Singapore in October, 2006.

Asiamoney AwardsBest Managed Company in India (Mid-cap) Pantaloon retail (India) Ltd.

The Asiamoney publication conducts a poll among fund manages andinvestors and does a quantitative analysis of financial performance toselect best managed companies in Asian countrie s.


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Ernst & Young Entrepreneur of the Year AwardErnst & Young Entrepreneur of the Year (Services) Kishore Biyani

Considered to be one of the most prestigious business awards in India, ajury comprising leading names in Indian business selected the win nersbased on courage, creativity, passion, endurance and vision.

CNBC Indian Business Leaders Awards

The First Generation Entrepreneur of the Year Kishore Biyani

Organized by CNBC-TV18, the twelve awardees in various categories aredecided by a high profile jury, along with research partners - TheUniversity of Chicago Graduate School of Business, Development

Dimensions International (DDI) and AC Neilson ORG MARG.Lakshmipat Singhania IIM Lucknow National Leadership AwardsYoung Business Leader Kishore Biyani

The award recognizes and honors individuals who have contributedconsistently to the betterment of our country through their pursuit of

excellence. The awards were presented in New Delhi by the PrimeMinister Dr. Manmohan Singh in December, 2006.

Images Retail Awards

Best Value Retail Store Big BazaarBest Retail Destination Big BazaarBest Food & Grocery Store Food BazaarRetail Face of the Year Kishore Biyani

The Images Retail Awards are decided through a nationwide consumer &

industry poll and nominations followed by performance assessment byteam of analysts and jury.

Readers Digest Awards

Platinum Trusted Brand Award - Big Bazaar

The Readers Digest awards are based on surveys done among consumersby independent research agency, Nielsen Media Research.

CNBC Awaaz Consumer AwardsMost Preferred Large Food & Grocery Supermarket Big Bazaar


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Conducted in association with AC Nielsen-ORG Marg across 21 majorcities, nearly 10,000 consumers were asked to choose their most prefe rredbrands.

Reid & Taylor Awards for Retail Excellence

Retail Entrepreneur of the Year Kishore Biyani2005

Images Retail Awards 2005

PRIL- Most Admired Retailer of the Year

Food Bazaar- Retailer of the Year(Food and Grocery)

Big Bazaar-Retailer of the Year(Value Retailing)

Central-Retail Launch of the Year

Voted by Business Today magazine as one of the

Top 20 Companies in India to watch in 2005

Indias most investor-friendly companies in the top 75

Indias Biggest wealth creators in the top 100

DAKS London

PRIL- Brand Builder of the Year

2004

Images Retail Awards 2004

PRIL- Most Admired Retailer of the Year

Food Bazaar- Retailer of the Year(Food and Grocery)

Big Bazaar-Retailer of the Year(Value Retailing)

Central-Retail Launch of the Year

Reid & Taylor and DLF Awards

PRIL - Retailer of the year

2003

Indian Express Award


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PRIL Marketing Excellence and Excellence in Brand Building

Indusland Bank (India Brand Summit)

PRIL - Excellence in Brand Building

CONSUMER BUYING BEHAVIOR

Understanding the buying behavior of the target market is the essential task

of marketing management under marketing concept. The consumer market

consists of all the individuals and households who buy or acquire good and

services for personal consumptions. The buying behavior tries to find out the

answers for the questions, who buys? How do they buy? Where do they buy?

Do they buy?

(A) FACTORS INFLUENCINGCONSUMERBUYINGBEHAVIORThere are four major factors that influence the buying behavior such as cultural

factors, social factors, personal factors, and psychological factors.

i. CULTURAL FACTORS: Culture is the most fundamental determinant

of a person wants and behavior. Values, per ceptions, preferences, and

behavior are the main variable under culture of an individual. Each

culture contains sub-culture like nationality, religious group, geographical

area, and linguistic divisions etc.

ii. SOCIAL FACTORS: A consumer behavior is also influenced by social

factors such as the consumer reference group family and social roles and

status.

iii. PERSONAL FACTORS:A buyer decision is also influenced by his or

personal characteristics, notably the buyers age, lifestyle, occupation,

economic circumstances etc.


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PSYCHOLOGICAL FACTORS: a person buying choice is also influenced

by four major psychological factors such as motivation, perception, learning

belief and attitudes.

(B)BUYING DECISIONPROCESS

It includes buying roles, types of buying and steps in buying process.

I. BUYING ROLE

The buying role could be classified into four parts. These are initiator,

influencer, decider and buyer.

II. TYPES OF BUYING BEHAVIOR

Consumer decision taking varies with the type of buying decision. There are

four types buying behavior such as Complex buying behavior, Habitual buying

behavior, Variety seeking buying behavior.

III. STAGES IN BUYING DECISION PROCESS

Here are five stages in buying decision process namely problem recognition

search, evaluation of alternatives purchase decision and past purchase behavior.

NEED RECOGNITION

The buying process starts with the buyers recognition of a problem of need.

The buyer senses a difference between his actual state and desired state.

INFORMATION SEARCH

There are different sources from where a consumer can gather information like

personal sources commercial sources, experimental sources.

EVALUATIONOFALTERNATIVES

After gathering information about different products the customer will be in a

fuss as to choose which product among the mainly alternatives consumer


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usually evaluate the alternatives on traditional basis, on the basis of utility

function etc. from the many alternative consumers at last choose the best one for

him.

PURCHASEDECISION

A consumer who decides to execute purchase intention will be making up to

five purchase decisions.

POSTPURCHASEBEHAVIOR

After purchasing the product and services the consumer will experience some

level of satisfaction or dissatisfaction with the product and se rvices that will

influence subsequent behavior. If consumer is satisfied he may show the

probability of buying the product the next time, satisfied customer will say good

thing about the product, proving the statement that "satisfied customer is the

best

advertisement. A dissatisfied customer may take some action against it. They

may try to reduce the dissonance by abandoning returning the product.

Understanding consumer needs and buying process is the foundation of any

company. By understanding how buyer s go through problem recognition,

information search evaluation of alternatives, the purchase decision and post

purchase behavior marketers can pick up many clues as to how to meet buyers

need.


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LITERATUREREVIEW

Marketing

Marketing is a societal process by which individuals and groups obtain what

they need and want through creating, offering and freely exchanging productsand services of value with others or other wise it is the process of planning and

executing the conception, pricing, promotion and distribution of ideas, goods,

services to create exchanges that satisfy individual and organizational goals.

MarketingStrategy

Marketing strategy is a set of objectives, policies and rules that leads the

company's marketing efforts. It is the marketing approa ch to accomplish the

bread objective of the marketing approach to accomplish the bread objective of

the marketing plan. The various process of marketing strategy are given below.

1. Selecting largest markets segmentation

2. Positioning

3. Product

4. Price

5. Place

6. Promotion

7. Research and development

8. Marketing research

Marketsegmentationandselectingtargetmarket

It is an effort to increase a company's precision marketing. The starting point of

any segmentation discussion is mass marketing. In mass marketing, the seller

engaged in the mass production, mass distribution and mass promotion of one


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product for all buyers. Market segment consists of a large identifiable group

within a market with similar wants, purchasing power geographical location,

buying attitudes or buying habita. It is an approach midway between mass

marketing and individual marketing. Through this the choice of distribution

channels, and communicaton channels become much easier. The researchers try

to form segments by looking at consumer characteristics; geographic,

demographic, and psychographic. After segmenting the market then target

market selected.

2. Positioning: - The positioning is a creative exercise donw with an existing

product. the well known products generally hold a distinctive position in

consumer's minds. The positioning requires that every tangible aspect of

product, price, place and promotion must support the chosen positioning

strategy. Company should develop a unique selling proposition (USP) for each

brand and stick to it, PPL consistently promotes its DAP fertilizer by Higher

yield at lower cost. As companies increase the number of claims for their br and,

they risk disbelief and a loss of clear positioning. In general a company must

avoid four major positioning errors. Those are under positioning over

positioning, confused positioning and doubtful positioning.

3.Product: - A product is any offering that can satisfy a need or want. The

major types ofbasicofferings aregoods, services, experiences, events, places,

properties, organizations, information and ideas. The company gives more

importance in quality, packaging, services etc. to satisfy the cust omers. The

products has it's life cycle. The product strategies are modified in different

stages ofproductlifecycle.


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4.Price: -Itis themostimportantaspect incompany's pointofview. Priceof

the productwillbedecidedbythecompanyaccordingto thecompetitor's price.

5. Place: - This plays amajorroleintheentiremarketing system. Thecompany

emphasis onit's distributionnetwork. Properdistributionnetworkgives properavailabilityofthe product.

6. Promotion: - Promotion is the one of the major aspects in marketing

strategies. By adopting various promotional activities the company create

strongbrandimage.Italsohelps inincreasingthe brandawareness.Itincludes

advertising, sales promotioins andpublicrelations etc.

7.Research and Development: -After testing, thenew product manager must

develop a preliminarymarketing strategy planforintroducingthenew product

in to the market. The plan consists of three parts. The first part describes the

target market's size, structure and behavior. The second part out lines the

plannedprice, distribution strategyandmarketingbudgetforthefirstyear. The

third partofthedevelopmentdescribes thelongrun sales andprofitgoals and

marketingmix strategyovertime.


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MARKETING MIX

Target Market

Product Price Promotion Place

Product variety List price Sales promotion Channels

Quality Discounts Advertising Coverage

Design Allowances Sales forces Assortments

Features Payment period Public relation Locations

Brand name Credit terms Direct marketing Inventory

Packaging Transport

Sizes

Services

Warrantie

returns


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MARKETING STRATEGY

Marketing is not Euclidean geometry a fixed system of concept. Rather

marketing is one of the dynamic fields with in the management arena. The

market faces continually a new challenge everyday and companies mustrespond to it positively. Therefore it is not surprising that new market idea keep

surfacing to meet new market place challenges.

The market process is applicable to more than goods and services.

Anything related to market including ideas, events, policies, prices and

personalities comes under market strategy. However it is important to

emphasize opportunity in the market through market strategy.

Following strategies adopted by the organization.

A strong quality of the product and customersatisfaction:

Customers always believe in good quality product. in my survey I found that

in percentage term more people is quality conscious and not price conscious.

Customer satisfaction is very important part of the organization that at any cost

they have to fulfill.

A growingrelationship with customerand customerretention:

Nowadays a good relation with customer is very important for organization.

Sale is totally depending on the relation with the customers. Customer's

retention is also a major aspect for growing business. It means keep the old

customer and try to make new customer.

Focus on competitors activity:

Every organization should must be careful about it's competitors step,

because they can disturb the growing sales process of the organization.

A growing emphasis on global thinking and local marketing planning:


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Companies are increasing by pursuing market beyond their borders. When

they enter other countries they must follow the tradition of that country and also

they make plan for local market that which type of product has more demand

and how can it run in the market.

Promotional Strategy

Under the market strategy promotional idea is very important. Organization

provides some schemes or rebates to retailers or consumers. They make

advertisement according to convenient of the people and the feature of the

product.

So on the basis of marketing strategy a organization runs in the market. It is

several types of which makes helpful to increase sales and turnover of the

organization.


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A.SECONDARY RESEARCH:

A comprehensive secondary research was carried out to find out the

various factors that affect the buying decisions of the consumers in a

department store. The main objective of this study was to analyze how

much significant effect each of these factors has on conversion rate of a

store and also their influence on the buying decisions of the consumers.

It consisted of:

-Searching secondary data sources, which included books, journals,

magazines, Internet, library, etc.

-Research and analysis of the secondary data collected from the store to

determine the trends.


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2.4b SCOPE OF THE STUDY

y The study is limited to the customers visiting the store from the entire

NCR region.

y The study is also limited to a particular store only.


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SSSEEECCCOOONNNDDDAAARRRYYY RRREEESSSEEEAAARRRCCCHHH

3.1 SCIENCE OF SHOPPING

The science of shopping is a hybrid discipline, part physical science and part

social science and only part science at all because it is also an art. It is a

practical field concerned with providing information that can improve the

retailer's edge and the odds of making a wrong decision. Much of the value of

the science lies in the ability to go beyond collecting data and making educated

guesses about what it means and how best to respond.

1

A recent study discovered that 75-80 per cent of shoppers often leave a

store without any purchases due to the inability to find products or

differentiate between them. Here comes the two-fold challenge. How to

connect with the customer and at the same time grow in a competitive

marketplace crowded with similarities at every level? Since the mass market

and universal audience are things of the past, traditional advertising no longer

works to convey a brand's image with a difference. In search for growth,

companies must think beyond conventional avenues. For most, growth is not

always about square footage expansion but making the most of what they

already have.

The very concept of conversion rate implies that shoppers need to be

transformed into buyers, i.e. when potential customer becomes an actual

customer. Conversion rates vary widely depending on what kind of store or

product we're talking about. In some sections of the supermarket, conversion

rate is probably 100% (dairy or toilet paper). In an art gallery full of paintings,


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probably the conversion will be less than 1%. Conversion rate measures what

you make of what you have - it shows how well or how poorly the entire

enterprise is functioning.


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3.2 CUSTOMER SERVICE

For a retailer, it costs more to get new customers than to keep the ones you

have. Also the longer you can keep a customer, the more valuable that

customer becomes. Studies done by consultants such as McKinsey have shown

that repeat customers generate over twice as much gross income than new

customers.

2"Firms that only understand buyer behavior may do a good job of selling

existing products within existing channels of distribution. But firms that

understand consumption behaviors are able to create value with new or

improved products and distribution channels.

For example, if an apparel retailer wants to find out what types of clothing its

typical customers really want to buy, it might want to get into consumers'

closets, literally. Enlightened retailers might ask women to show them how they

put together their wardrobes -- how they use the fashions they own, which may

span several years. From such an exercise, retailers can learn how consumers

mix and match items, which items they choose to keep in their closets for many

years, and why.

However, many organizations do not allocate the time, or the money, to educate

and train their employees to deliver the service customers want. Often, thereason is that those organizations don't realize how important customer service

is to their bottom lines.

Importance of a good customer service:


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Educating employees to provide quality service works to an

organization's advantage in many ways. Of primary importance is that it

improves customer retention. By finding out what services customers

want -- and then delivering them -- businesses can develop and nurture a

strong, loyal customer base.

Loyal customers are not only important, they are essential. 3Research

shows 65 percent of a typical organization's business comes from

current loyal customers.

Besides making up a base of customers who continue to purchase a

company's products or services, those loyal customers help drive the

company's business by delivering the most powerful and cheapest form

of advertising available: word of mouth. A strong customer base is the

most credible source to potential customers, spreading the reputation of the

business, free of charge, and attracting new customers.

4As a customer's relationship with [a] company lengthens, profits rise.

Customer defections have a surprisingly powerful impact on the

bottom line. It is common for a business to lose 15 to 20 percent of its

customers each year. When defections are cut in half, the average

growth rate more than doubles. A five percent change in rate of

retention swings profit increases from 25 percent all the way to 100

percent.

Bad service has another pitfall: It causes employee turnover. Studies

have shown that employee turnover was inversely proportional to

employee perceptions of the quality of service provided by the ir


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employers. When service is perceived as bad, not only do consumers not

like to patronize the company, but employees don't like to work for it.

The highest turnover rates are associated with companies possessing the lowest

employee ratings of service qua lity. That finding was confirmed when Sears

surveyed customers in 771 of its stores. In stores that received relatively high

customer service ratings, 54 percent of the sales force turned over in a year

compared with 83 percent at stores with low customer service scores.

How we treat customers throughout the year when they are

purchasing or even when they are returning items, sets the stage for

their future business. Contradictions in consistency will drive them to

the competition. You see the gift at the holidays, is the gift our customers

give us by coming back to show how much they have appreciated us all

year long!

Employees are not bad performers, just poorly trained. In order to

have consistent service, employees must have consistent training on a

continual basis. What's more is that they must be held accountable for

their performance on a continual basis, not just at a once a year review

time. Lastly, employees need to be rewarded consistently so that they

realize their importance in the company. Wi thout them, there would be no

business, now would there?

Treating Customers Well:

We make it difficult for them to buy and then we make it more difficult

for them to bring it back and we wonder why they choose to shop

elsewhere?


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Train the employees to have patience to work within store policy and to do it

positively while showing how proud they are of the store and its products.

PANTALOONS: Fashion by Pantaloons

Pantaloons is the company's departmental store and part of life style retail

format. In fact, PRIL took its very initial steps in the retail journey by setting up

the first Pantaloons store in Kolkata in 1997. In a short time Pantaloons has

been able to carve a special place for it self in the hearts and minds of the

aspirational Indian customers. The Stores have entire range of Menswear,

Womenswear, Kidswear, Activewear, Accessories, Cosmetics, Fragrances,

Homeware, Jewellery, Toys, Books, Music, Stationery, Gift, Novelties, etc.

With 16 stores across the country and an ever-increasing stable of private

brands, Pantaloons - in the coming years is poised to become a leading fashion

trendsetter.

Growth through private labels: A striking characteristic of Pantaloons has been

the strength of its private label programme. In Pantaloons 70% of apparel sales

come from own labels. John Miller, Ajile. Scottsvile, Lombard, Annabelle,

Honey, Bare are some of the successful brands created by the company.

Manufacturing: There is a drive for backward integration, into manufacturing.

Pantaloons is a manufacturer retailer. Manufacturing helps the company plan

the products better depending on what is selling at the stores and also helps

better margin. The company has trouser manufacturing unit in Tarapur and a

denim plant in Goregaon, Mumbai.


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Customer Relationship Management (CRM)

CRM is a management approach that seeks to create, develop and enhance

relationships with carefully targeted customers to maximize customer value,

corporate profitability and shareholder value. CRM leverages informationtechnology (IT) to implement relationship-marketing strategies. Already

customers are getting actively involved, either directly or indirectly with

production processes. They make suggestions, they ask for smaller, brighter,

easier-to-use products.

CRM is not a tool that is specific to any industry type, so there is no one single

definition of Customer Relationship Management. It is up to the organization to

formulate one for itself in order to achieve the CRM goals that it sets for itself.Companies that have adopted CRM regard every customer as an individual with

specific needs and tailor their services accordingly. Information Technologycomes into the picture to help manage Customer relationships in an organized

way.

On an average a company has only a 5 to 20 percent probabil ity of making a

successful sale to a new prospect but has a 60 to 70 percent probability of

selling again to active customers. It would be wiser to invest in encouraging an

existing customer to purchase again. Companies that followed up lapsed cases

experienced 20 to 40 percent successful sales. Without a doubt customer

retention is vital to every company's long -term profitability and success and

CRM, through target selling and customer loyalty programs, can help to

motivate the best customers and to remain loyal as a method of increasing

revenues internally.

Rising customer expectations have stiffened the competition among companies

to improve their customer support services. Todays customer has access to the

latest technological devices that give him ins tant information, allows him to

make instant transactions, buy, sell or transfer money, he has access to it all

over his palm top, PDA, mobile phone or desktop. Todays customer is

knowledgeable, he knows what he wants and the Internet is a powerful tool i n

his hands.


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More than ever, customers today have an important role to play in the product

lifecycle. Customers are continually pressing for improved support services interms of product coverage, business-ease, response-time and price (or at least

value-for-money!). With a wide variety of services available at competitiveprices and easily accessible at the click of a button, improved customer servicesare becoming the need of the day. Customers are driving companies to migrate

from being purely product-centric to purely customer-centric, taking care of allcustomer requirements even before they are demanded.

From current customer trends, it is easy to define the future customer. The

volume of information available via the Internet will make the future customer a

knowledgeable one. As more customers and businesses go online, the Internet

will foster a global community that communicates at real -time. Customers will

have access to a wider variety of products and prices to choose from. To stay

ahead of competition, companies will have to anticipate customer needs even

before a need arises. As more and more women began to drive two wheelers in

India, the smarter manufacturers realized that one factor that might hold a sari -

clad woman back, would be having to kick-start her bike. Along came the self-

starter button and presto, a surge of women two wheeler drivers! The success of

companies will depend on how well they are able to predict customer behavior,

anticipate requirements and provide for them. The future customer will have a

larger stake in the companys project plans, his input will have value and his

feedback will be consequential to the development of products or the way a

service is delivered. This implies a significant alteration in the supply chains

that we see today.


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The CRM strategy should include:

(a) Operational CRM: Automating interaction with the customers and sales

force, and

(b) Analytical CRM: Sophisticated analysis of the customer data generated by

operational CRM and other sources like POS (Point of Sales) transactions, web

site transactions, and third-party data providers.

A typical retail organization has a huge customer base and often customer'sneeds are fairly differentiated. Without the means to analyze voluminous

customer data, CRM Strategy is bound to be a failure. Hence, Analytical CRM

forms the core of a retailer's customer relationship strategy. Marketing and sales

functions are the primary beneficiaries of Analytical CRM and the

Main touch points from where the insights gained about the customer is

absorbed in the Organization. Analytical CRM uses the key business

intelligence tools like data warehousing, data mining, and OLAP to present a

unified view of the customer.

Following are some of the uses of Analytical CRM In Retailing


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Customer Segmentation

Customer segmentation is a vital ingredient in a retail organization's marketing

recipe. It can offer insights into how different segments respond to shifts in

demographics, fashions and trends. For example it can he lp classify customersin the following segments

1) Customers who respond to new promotions

2) Customers who respond to new product launch

3) Customers who respond to discounts

4) Customers who show propensity to purchase specific products

Campaign/ Promotion Effectiveness Analysis

Once a campaign is launched its effectiveness can be studied across different

media and in terms of costs and benefits; this greatly helps in understanding

what goes into a successful marketing campaign.

Campaign/ promotion effectiveness analysis can answer questions like:

Which media channels have been most successful in the past for various

campaigns?

Which geographic locations responded well to a particular campaign?

What were the relative costs and benefits of this campai gn?

Which customer segments responded to the campaign?


44/60

Customer Lifetime Value

Not all customers are equally profitable. At the same time customers who are

not very profitable today may have the potential of being profitable in future.

Hence it is absolutely essential to identify customers with high lifetime value;

the idea is to establish long-term relations with these customers. The basic

methodology used to calculate customer lifetime value is - deduct the cost of

servicing a customer from the expected future revenue generated by the

customer, add to this the net value of new custo mers referred by this customer,

and discount the result for the duration of the relationship. Though this sounds

easy, there are a number of subjective variables like overall duration of the

customer's relation with the retailer, gap between intermediate c ash flows, and

discount rate. We suggest data mining tools should be used to develop

customized models for calculating customer lifetime value.


45/60

Customer Loyalty Analysis

It is more economical to retain an existing customer than to acquire a new one.

To develop effective customer retention programs it is vital to analyze the

reasons for customer attrition. Business Intelligence helps in understandingcustomer attrition with respect to various factors influencing a customer and at

times one can drill down to individual transactions, which might have resulted

in the change of loyalty.

Cross Selling

Retailers use the vast amount of customer information available with them to

cross sell other products at the time of purchase. This effort is largely based on

the tastes of a particular customer, which can be analyzed using BI tools based

on previous purchases. Retailers can also 'up sell' - sell more profitable products

- to the customer at the time of contact.

Product Pricing

Pricing is one of the most crucial marketing decisions taken by retailers. Often

an increase in price of a product can result in lower sales and customer adoption

of replacement products. Using data warehousing and data mining, retailers can

develop sophisticated price models for different products, which can establish

price - sales relationships for the product and how changes in prices affect the

sales of other products.

Target Marketing

Retailers can optimize the overall marketing and promotion effort by targeting

campaigns to specific customers or groups of customers. Target marketing can

be based on a very simple analysis of the buying habits of the customer or thecustomer group; but increasingly data mining tools are being used to define

specific customer segments that are likely to r espond to particular types of

campaigns.


46/60

FFFiiiggguuurrreee


47/60


48/60

AAAnnnaaalllyyysssiiisss ooofffQQQuuueeessstttiiiooonnnnnnaaaiiirrreee

Most of the respondents go to near by areas to shop. The malls in Mumbai

where weekend rush is a major pinpoint. The others are markets like Crawford ,

Heera panna.

46

39

15

ere o you like to s o ?

Malls Markets Others


49/60

The preference towards the area of Mall holds the key to where people

frequently shop. The success of a store is concentrated towards the area of the

place and the brand value it holds in terms of the changing consumer lifestyles.

The average walk ins are high in Shoppers stop because of the wholesome

entertainment in the location of the store. I believe if Pantaloon as a store can

look for opportunities where there is wholesome entertainment along with the

Mall E.g. Forum in Kolkotta it would surely add to their profits.

6%

36%

40%

12%6%

Which Shopping store's do you like toshop?

Life style

Pantaloon

Shoppers Stop

Westside

Others

44

31

Are you a member of any

Shopping Store LoyaltyProgram

NO


50/60

The Loyalty club members are less because of the number of people who

frequently shop at the same store in a particular area. The respondents I askedquestionnaire vary from places in Pantaloon, Shoppers Stop, Internet andmarketing my mailers.

As you can see majority of the loyalty programs members are through In store

purchases. The loyalty clubs in India are at initial stage of getting the customers.

There are similar programs of every organized retailer for membership. The

criteria for Pantaloon are higher because of majority of respondent from being

collected from that area.

3 2 1 2 03

22 18 10 70

0 30

005

10152025

30

bony Pantaloon Shoppers

Stop

Westside thers

How did you come to know about

the loyalty club?

riends In store Internet


51/60

0 0 0 0 00 0 0 0 00 0 0 0 000.20.40.60.8

1

0 0 0 0 0

How did you come to know

about the loyalty club?

#REF! #REF! #REF!

0%0%0%0%0%

Which shopping club are you a

member?

0 0 0 0 0


52/60

Most of the people who frequently shop at the same stores are members of two

or more loyalty club programs. Most of the common is being Shoppers Stop and

Pantaloon. Shoppers Stop is most preferred loyalty club with members getting

updates and knows how about the store regularly. Pantaloon loyalty program

isnt followed in terms of its CRM processes unlike Shoppers Stop. Westside

stores follow up is very punctual in terms of their reminders to their selected

customers.

0%0%0%0%0%

Rate o r refere l

0 0 0 0 0


53/60

All the loyalty programs provide similar offers. They invite you to different

events depending upon your membership relating to the card you hold.

00.10.20.30.40.50.60.70.80.9

1

0 0 0 0 0

What offers do you get by those

clubs?

#REF! #REF! #REF! #REF!


54/60

The respondents who were members of pantaloon loyalty club were 24. The

graph clearly shows that the staff of pantaloon is very good and helpful in termsof the services. Unlike most of the shoppers people arent satisfied enough with

0

5

10

15

20

Pa taloo oyalty cl i terms

of services

eward

tructure

Promotion

Offers

chemes

privileges

edemption

options

0

5

10

15

20

25ense of

bonding with

staff

Value Addedservices of the

store

Other

preferences:-

Parking

preferences


55/60

the kind of reward structure the company provides. But, the best part of the

people is the kind of promotion offers differs from the rivals. I think this can bea Unique Selling Preposition for pantaloon stores all over India.

Most of the time the shoppers arent interested in any sort of loyalty programbecause it doesnt add to much to their value. The criteria for the shopping

stores to have a loyalty program is to increase the frequent purchases of the

store but, somehow it isnt able to cater the services of the respondent who is atan age where he or she is doing her graduation or about to start his or her career.

44%

34%

22%

Why aren't you a part of any

shopping store loyalty

program?Minimum

Requirements

Dont shop

frequently at the

same store

ot interested


56/60

Out of the 31 respondents most of the people arent willing to be a member ofany loyalty club as such probably because of shopping at different places in

different areas. One of the mains reason being said by few customers is theydont add to the overall value to their purchases.

32

68

Would you consider being a part of

a loyalty club?

YES NO

48

27

Ratio of Respondent

Male Female


57/60

As you can clearly see from the above graphs the loyalty club members areusually high-end A1 customers who frequently shop at a particular place. Most

of the people are working executives and businessmen who find ambience andlatest fashions the key dominants to shop and enroll for the loyalty program.

FFFiiinnndddiiinnngggsss fffrrrooommm QQQuuueeessstttiiiooonnnnnnaaaiiirrreee

1)People respond better to Internet mailers then courier. I think that thissuggests the loyalty club members are technosavy so, there is a need for all

34

270

14 0102030

40A1

A2

B1

B2

SECClassificatio otal

Series1

23

19

0

2 0

5

10

15

20

25A1

A2

B1

B2

Loyalty Club Members

Series1


58/60

the loyalty clubs to start their online ventures in relation to their CRM

process.2)Most of the organized retailers in India are offering similar services on

customer loyalty programs. From a customers stand he or she would only be

differentiated by the brand name of the company.

3)Shoppers Stop is the number one retailer whose Customer loyalty program isvery well integrated compared to the other retailers.

4)Pantaloon as a store appeals more to the working class and family orientedpeople especially in Gurgoan.

5)Lifestyle is at a initial phase of launching the Customer loyalty program.6)The average number of walks ins in a store is generally on the place of the

mall.7)The CRM strategies of all the organized retailers are still very less integrated

in terms of the international players like Wal- Mart and other multi chain

outlets in the World.

8) I think the changing consumer patterns are not tapped by the retailers for theCustomer loyalty programs

9)Banks provide cash back credit card in form of an extended discount tovarious organized retail outlets.

10)The Reward structure needs a revision to tap in more customers so that the

profit margins can be increased

11)Overall, the companies should start looking for means to attract peoplecoming in at the store in the form of extended shopping hou rs, double points onoff days etc.

12)The pantaloon store should have a small area specified to the entertainment

segment inside the store in the form of contest etc.


59/60

BIBLIOGRAPHY

APPENDIX

BOOKS

AUTHOR PHILIP KOTLER

TITLE MARKETING MANAGEMENT

PLACE OF

PUBLICATION

PRENTICE HALL OF INDIA LTD.

NEW DELHI

DATE OF PUBLICATION SEPTEMBER

NUMBER OF PAGES 31-50

MAGAZINE

AUTHOR MURTHY E.N.

TITLE ANALYST

DATE OF ISSUE JULY 2006

PAGE NUMBER 41-46

INTERNET- www.pantaloon.com

- www.amazon.com

- www.economictimes.com


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QUESTIONAIEER

(1) NAME :

(2) AGE :

(3) ADERSS:

(4) GENDER:

(5) How often do you buy apparels(clothes) ?

- Once a week

- Once in 15 days

- Once a month

- Once every three month

- Once every 6 month

- Once a Year

(6) From where do you buy your apparels(clothes) ?

y Pram id

y Central s

y Shoppers

y Mega mart

(7) How much do you normally spend on apparels(cloths)

bought

from shopping mall in a single shopping

y Less than 500

y Between 500 to 1000



y More than 5000

y Not applicable

(8) Do you have Green Card ?

y Yes

Pantaloon Retail India PRJT

Documents