Retail Marketing Strategy Of Marks And Spencer In Singapore

Focus on Customer Needs and Loyalty

Question:

Discuss about the Marketing Strategy and Plan for Retail Marketing Sustainable Management Futures.

In the current growing market, the term retail marketing is known to become the major trend that is emerging in the whole of the economic cycle. For the consumer, the retail market provides the basic platform is order to encounter with the goods and the shop owner at the start. Fixed locations such as departmental stores, specialty stores, supermarkets, etc. are comprised under the retail market (Goworek & McGoldrick, 2015). Here Marks and Spencer in Singapore is taken as the Non-domestic Retailer.

These are the locations where the consumer is met with the shopkeeper and will make the purchases of the goods in return which has some certain value. All goods are sold by the shopkeepers to the consumers by maintaining a certain margin for gaining the profits. The main purpose of the retail market shopkeepers is just to satisfy the customers. In addition to this, their needs are fulfilled along with the demands (Boboc, Ariciu & Ion, 2015).

In the marketing strategy, the strategy of the Marks and Spencer‘s retail marketing has developed into one of the fundamental elements. In this, a whole lot of planning and the proper implementation of the planning are included (Gupta, 2014). First, the focus should on the nature of the retail which is simple. The major factors in the retail industry are that the marketer has to focus primarily on the desires and the needs of the consumers.

The customer loyalty of Marks and Spencer has to be created by the business which is considered to be the basic function of the retail. This is because if one’s the loyalty of the customer is gained towards your brand than to sustain in the marketplace will not be a difficult task for the longer duration of time. But creating the customer loyalty is not an easy task. It will take years in order to create the customer loyalty by the brand (Miller, 2014).

Retail mix could be defined as a formidable element in the strategic direction of an enterprise and is responsible for accomplishment of retail strategy objectives. The retail mix allows the translation of a strategic planning process into a functional marketing campaign. The comprehensive planning and integration for accomplishing reasonable retail mix objectives is accountable for the outcomes such as improvised differentiation in products, competitive advantage of the retail organization over industry peers and emphasis on the marketplace. The retail mix of Marks and Spencer comprises of six profound factors such as merchandise range and assortment; marketing communications; store layout, visual merchandising and store design; store formats and locations; customer services and delivery of services; and pricing strategy and tactics. The following illustration of the individual elements in the retail mix facilitates a comprehensive evaluation of feasible prospects for realizing retail strategy.

The retail industry primarily relies on the efficiency of the merchandise in attracting as well as retaining customers regardless of the nature of products or services. Therefore the necessity for reflection on product breadth in context of Marks and Spencer range element in the retail mix could be imperatively observed. The merchandise mix could be aptly moderated to the market requirements through determination of a cognizable balance between the product depth and breadth thereby contributing to the success of the retail establishment. Furthermore, these factors are also assumed as generic elements of a retail inventory strategy (Floyd, et al., 2014). Product breadth can be defined as the assortment of product lines provided by the retail establishment and it is also known as merchandise breadth, product line width and product assortment width. The references to higher product breadth are accountable for a larger assortment of product lines without any prominent concerns for brand choices.

The Retail Mix

The efficiency of product breadth in context of Marks and Spencer is also associated with the product mix length that accounts for the total products served by the organization in individual product lines. The definitions of merchandise depth is also a necessary implication for product mix since it serves as the significant half of the retail inventory question alongside product breadth. The merchandise depth is indicative of different variants of specific product facilitated by the organization (Fornari, et al., 2013). The difference in the product line breadth and depth would have to be considered accountable for determining the retail product mix. However, these two elements are responsible for framing the merchandise mix or the product assortment of a retail organization. It could be observed that product breadth is minimal for specialty retailers such as Nike which provide higher product depth i.e. variety in its specific product line. On the other hand, retailers such as Tesco provide higher product breadth and hence customers could be able to access assortment from the merchandise mix (Haddock, et al., 2014).

Marketing communications are assumed as viable resources in the retail mix since they are able to address the promotional requirements for the business. Marketing communications allow the organization to access opportunities for informing, persuading and reminding people regarding the organization and its products. The essential references to the generation of plausible outcomes through store based methods and market based methods for promotion of the organization refer to impact of promotion on beliefs, behavior and feelings. The implementation of communication mix in retail industry is indicative of the outcomes of competitive advantage as well as customer engagement. Necessary elements for store based promotions refer to in-store displays of discounts for specific products and new product arrivals. Point of Sale displays, in-store advertising, personal selling, the sale and in-store sales promotion can be assumed as the profound indicators of store based promotion methods. Store based promotion methods are associated with promising characteristics such as offering products to customers, in-store motivation of customers for purchasing, promotional pricing in a specific period, comprehensive communication with store personnel and in-store customers (Jayasankaraprasad, 2014).

The store layout, design and visual merchandising aspects of retail mix are also accountable for describing the strategic capabilities of the organization to acquire sustainability. The impact of the aesthetics of a store is also considered as prominent inclusion in the retail mix since it influences consumer behavior thereby moderating the implications for sustainability and competitive advantage of the organization. The exterior design is accountable for drawing customers towards the store on the basis of the propagated vision of the organization. Examples of major retail organizations implementing similar store exterior design in various locations could be imperatively observed (Melis, et al., 2015).

The influential factors in context of store layout refer to the functional utilization space, invitation for customers and interior arrangements. Depending on the store location and shopping scenarios, retail store design and visual merchandising approaches could be determined for an organization. The store design and layout offer the customer with a viable impression of the store’s offerings alongside providing retailers with the opportunity to improve communication and create a promising image of the store in customers’ minds. The environment created by the layout and design of the store refer to the exterior look of the store, store interiors, promotions, atmosphere of the store and the themes associated with the store. The exterior design of the store comprises of the location, parking, architecture of the building, ease of access and compliance with health and safety regulations (Oppewal, Tojib & Louvieris, 2013).

Product Breadth and Depth

Providing service of superior standards has always been an objective for Marks and Spencer. To render best service is also challenging and complex at the same time. This is due to the inconsistent and intangible characteristic soft the services that are provided. Standardization and customization are basically used by the retail company to deliver better customer service. Customization of services of Marks and Spencer in accordance with the requirements of the customers while standardization involves following of the guidelines during the delivery of the service.

Different services provided by the retail company can be categorized into three groups such as pre-transaction, post transaction, and transaction services. Availability of information and convenient retailer hours are the pre-transaction services that are commonly offered to the customers by the company (Rolbina, et al., 2016). The customers are targeted for gathering of information regarding a merchandise of a store and the processes to purchase through pre-transaction services. The delivery of the transaction service occurs when the customers are shopping at the store. The retailer provides post-transaction services after the services or merchandise have been purchased. Evaluation of the quality of service is done by the customers through comparison of the delivery of the actual service at the store with the expected service. 

The gap between the expected service quality and the perceived service equality has resulted into the recognition of four types of gaps in the delivered service quality. The retail company has to minimize and try to close the gap between expected and delivered service so as to improve the service quality. The Marks and Spencer can reduce the gap by identifying the expectations of the customers, standards establishment to deliver the service that is expected by the customers, provision of support to the service provider on an instrumental and emotional level, and communicating the service offerings and merchandise to the customers in a practical manner.

The Marks and Spencer can strengthen and re-establish the bonds with the customers by following the procedure of listening to the customers, provision of a practical and fair solution and fast resolution to the issues. Customer service is the major determinant of success in the retail industry. Maximum profits can be earned by the retailer by developing the integrating programs for the customer service (Stovall III, 2015).

The retail formats have evolved over time since as they are considering consumer’s ease and hassle free experience. The retail formats adopted today have made the customer’s experience convenient and simple. The retail formats can be classified into various kinds.  

Departmental stores –

These forms basically deal with wide range of consumer goods like home appliances, apparels, electronic, etc. Premium assortments are stocked and customers can check them and make purchases based on their preferences. Emphasis is laid on quality of products. Eg: Marks & Spencer plc is a British multinational retailer which has multiple stores in Singapore.

Supermarket –

It is a large form of traditional retail store which deals with grocery items like eatables and other household items. Generally it is situated at a location which is easily accessible by customers. Eg Walmart is an American retail supermarket which has international presence. It has over 800 stores in Asia alone.

Marketing Communications

Emporium –

It refers to an outlet which sells large variety of products. Eg: Furniture emporium. The American furniture brand “Ashley Furniture Homestore” plans to open over hundred stores in India.

Superstore:

A superstore can be described as a very large supermarket that is mostly the selling centre for household goods, electrical goods, clothes, foods, etc. Superstores generally charge anywhere from 16 to 45 percent less than the smaller counterparts in the market.

Hypermarket:

The hypermarket is a retail store that includes a grocery supermarket and a departmental store. It is a large establishment that offers a wide range of products such as clothing, groceries, and appliances.

There are various external factors which affect profitability of retail business. Setting up fair price is crucial since it is the only source of revenue generation. Before determining right price they should be aware about costs associated with products. The two prime costs involved are cost of goods and operating cost. The first cost comprises of amount paid for the product, shipping charges. The latter involves expenses incurred for marketing, overhead charges, etc.

The main object of pricing strategy is to cover costs involved in obtaining products and expenses involved in operating in the business. Below are a few major retail pricing strategies:

The pricing technique involves setting a high price for the products or services so that they can encourage customer to have positive perception about the offering (van Loon, et al., 2015). They try to bring about psychological association of “luxury” when they adopt this strategy Eg: Apple.

The strategy is to sell low priced products in large quantities. The object is to increase the sales in peak seasons. Promotional discounts are short-term and are given to increase sales. It is beneficial for customers who purchase in bulk. Eg: Walmart.

With this technique the consumers can purchase products at a low price without having to wait for discount season or promotional events. It helps retail stores to reduce time, effort and expenses involved to reduce prices during specific events. Eg: Procter & Gamble.

This strategy is adopted when high price is charged for a product but once its popularity declines, it is sold at lower price through sales.. Buyers should have a specific preference while making such purchases. A different method of using the strategy involves inflating the price for short duration. Eg: Apparel retailers.

The conclusive interpretation of individual strengths and weaknesses that could be facilitated by the distinct elements of the retail marketing mix should be a promising factor for determining the sustainable competitive advantage that can be acquired by retail organizations. The first element in the retail mix of Marks and Spencer is related to merchandise range or product assortment that could provide considerable competitive advantage (Gruber & Wigmore, 2016).

Retailers face substantial difficulties in attaining sustainable competitive advantage since majority of competitors could purchase products of popular brands and sell them. However, the aspect of formulating private-label brands which indicate the existence of prospects for product development, marketing and sale could be realized in the case of the concerned retail enterprise to obtain sustainable competitive advantage (R?ducan & R?ducan, 2014).

Store Layout and Visual Merchandising

This factor could be considered as the benefit derived from product depth and indicates the pitfalls that could be associated with product breadth. The extent of the product breadth creates choices for competitors to introduce substitutes or sell the nationally accessible brands at rationally minimal prices (Gruber &Wigmore, 2016). Private label brands are also reflective of the potential for quantified results that could be accomplished from the customer loyalty and feedback for a specific product of private label brands.

The store location, design, layout and visual merchandizing can be moderated to adapt to the existing market scenarios which provides advantage. On one hand while these elements in the retail mix are accountable for advantages such as behavioural influences on the customer’s mind-set and creating an amiable environment. However, the changing preferences of customers and the increasing variation in product lines could require changes in the store layout and designs which could involve substantial costs for renovation and remodelling.

While the notable benefits of brand identity and attractiveness could be obtained from this aspect of retail mix, the limitations that could arise in the long term activities of the retail enterprise could reduce the potential of store location and design to accomplish sustainable advantage for the enterprise (Varley&Rafiq, 2014). 

Marketing communications serve as the channel which connects the organization with the customers. Customers have the opportunity to access information pertaining to various product lines and the discounts which are offered for specific products. The use of marketing communications for estimating the prominent factors related to brand attractiveness also serve as prolific advantages for the company (Gruber &Wigmore, 2016).

The critical reflection on the disadvantage that can be noticed in the case of marketing communication refer to the insufficiencies in addressing diverse customer segments and the presence of noise in various marketing channels which could lead to false perception of brand identity  by customers.

Customer service is also accountable for providing sustainable competitive advantage for a retail organization. Customer services have the capability for developing a considerable brand image for a concerned retail organization since the identity of an enterprise is largely framed on the basis of interrelation between reputation, tradition and customer service (R?ducan & R?ducan, 2014). On the contrary, the dependence on human resources and the prospects for sustainable competitive advantage could be acquired only through developing a service reputation.

Formats and locations of stores serve as the critical factors for the decision of customers. The development of strong competitive advantage with respect to the selection of a favourable location could be considered as a prominent advantage of formats and store location in the retail mix. However, a critical gap is also associated with this element of retail mix which refers to requirement of a sustainable location alongside the concerns for establishing strategic approaches to establish various store formats according to location and the type of merchandize that would be provided to customers (Varley & Rafiq, 2014).

Pricing strategy and tactics of Marks and Spencer could provide sustainable competitive advantage when moderated effectively in unison with the merchandise range and customer service aspects of retail mix. One of the formidable strengths of pricing strategy and tactics element in the retail mix is directed towards the immediate acquisition of customers. However, the pricing strategy and tactics are associated with pitfalls in the long term when changes in the enterprise’s external and internal environment or changes in customer preferences could lead to revision of pricing.   

SWOT Analysis of Marks and Spencer:

• Huge competition at international Market
• Due to technical advancement
• Political environment has immense effect on it.
• Need to establish the good relationships with other franchisees.

Conclusion:

With the help of the appropriate retail marketing plan the customer loyalty can be created. Some of the examples of such plans are as follows: promotional activities of sales in the form of gifts, discounts, coupons, reward points, loyalty cards, etc. It is now possible for creating the healthy relationship with the customers with the help of the numerous newly developed sales promotional programs that are promoted by the retail marketing strategies.

During earlier times, it has not taken into consideration in creating the emotional bonding with the customers, and hence customers were just treated as the customers to buy goods and pay the amount. Thus, this is the reason for the lower loyalty of the consumers and therefore gave rise to the wide range of product switching.

Therefore, for igniting the sales target the marketing strategy of creating strong bonding with the customers has to be made by the company so that it can reach its profit level with the increased loyalty for the brand.

References

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Fornari, E., Fornari, D., Grandi, S. and Menegatti, M., 2013. The influence of retailing-mix levers on private label market share: The case of the Italian FMCG market. Journal of Retailing and Consumer Services, 20(6), pp.617-624.

Gruber, P. and Wigmore, T., 2016.Leadership and Management. In Handbook of Intensive care: Organization and Management (pp. 3-25).

Goworek, H. and McGoldrick, P., 2015. Retail Marketing Management: Principles and Practice. Pearson Higher Ed.

Gupta, S., 2014.Retail marketing–an exemplar changeover.ZENITH International Journal of Multidisciplinary Research, 4(8), pp.1-8.

Haddock, C.K., Hyder, M.L., Poston, W.S., Jahnke, S.A., Williams, L.N. and Lando, H., 2014. A longitudinal analysis of cigarette prices in military retail outlets. American journal of public health, 104(4), pp.e82-e87.

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Melis, K., Campo, K., Breugelmans, E. and Lamey, L., 2015. The impact of the multi-channel retail mix on online store choice: Does online experience matter?. Journal of Retailing, 91(2), pp.272-288.

Miller, D., 2014. Retail Marketing: A Branding and Innovation Appraoach.

Oppewal, H., Tojib, D.R. and Louvieris, P., 2013. Experimental analysis of consumer channel-mix use. Journal of Business Research, 66(11), pp.2226-2233.

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Stovall III, G.W., 2015. A Tale of Two Cities-San Francisco and Tucson: The Effects of Retail Mix on the Perceived Value of the City, Urban Identity and Willingness to Pay.

van Loon, P., Deketele, L., Dewaele, J., McKinnon, A. and Rutherford, C., 2015. A comparative analysis of carbon emissions from online retailing of fast moving consumer goods. Journal of Cleaner Production, 106, pp.478-486.

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