Hiresh Lamani-0526-Maketing Strategies of Subhiksha

Marketing Strategies of Subhiksha Retail Outlet in Bangalore 1
MARKETING STRATEGIES OF SUBHIKSHA RETAIL OUTLETS IN BANGALORE

A DISSERTATON SUBMITTED IN PARTIAL FULFILMENT OF THE REQUIREMENTS FOR THE AWARD OF MBA DEGREE OF BANGALORE UNIVERSITY BY
Hiresh Lamani
Reg.No-05XQCM6030
Under the guidance and supervision Of DR K.V PRABHAKAR Senior Professor M P Birla Institute of Management Bangalore
M P BIRLA INSTITUTE OF MANAGEMENT (ASSOCIATE BHARATIYA VIDYA BHAVAN) #43, Race Course Road, BANGALORE. 560001 2007
M.P.Birla Institute of Management
DECLARATION
I hereby declare that this dissertation entitled a study on MARKETING STRATEGIES OF SUBHIKSHA RETAIL OUTLETS IN
BANGALORE is the result of my own research work carried out under the guidance and supervision of Dr. K V Prabhakar, Senior Professor, M P Birla Institute of Management, Bangalore
I also declare that this dissertation has not been submitted earlier to any Institute/organization for the award of any degree or diploma.
Place: Bangalore Date: (Hiresh Lamani)
CERTIFICATE
This is to certify that this dissertation entitled MARKETING STRATEGIES OF SUBHIKSHA RETAIL OUTLET IN
BANGALORE is the result of research work carried out by Mr. Hiresh Lamani under the guidance and supervision of Dr K V Prabhakar, Senior Professor, M.P. Birla Institute of Management, Bangalore.
Place: Bangalore Date:
(Dr. Nagesh S Malavalli) Principal
CERTIFICATE
I hereby state that the Dissertation entitled MARKETING STRATEGIES SUBHIKSHA RETAIL OUTLET IN BANGALORE is the project work carried out by Mr. Hiresh Lamani under my guidance and supervision
Place: Bangalore Date:
(Dr K V Prabhakar) Senior Professor
ACKNOWLEDGEMENT
I am happy to express my gratitude to Dr. N. S. Malavalli, (Principal, M. P. Birla Institute of Management and many valuable ideas imparted to me for my project.
I extend my sincere thanks to Professor Dr. K. V. Prabhakar (Senior Professor) M.P.Birla Institute of Management, Bangalore for providing me all the Information required and the guidance throughout the project without which this project would not have been possible.
Place: Bangalore Date: (Hiresh Lamani)
CONTENTS
SERIAL NO CHAPTER-1 CHAPTER- 2 CHAPTER-3 CHAPTER-4 CHAPTER-5 CHAPTER-6 CHAPTER-7 CHAPTER-8 CHAPTER-9 CHAPETR-10 CHAPTER-11 CHAPTER-12 CHAPTER-13 CHAPTER-14 CHAPTER-15 CHAPTER-16 CHAPTER-17 PARTICULARS EXECUTIVE SUMMERY GROWTH OF RETAIL OUTLETS IN THE MODERN MARKETING SCENARIO INTRODUCTION TO SUBHIKSHA SUBHIKSHA AT BANGALORE OPERATIONAL STRATEGIES OF SUBHIKSHA KALIEDOSCOPE OF STRATEGIC MARKETING AN OVERVIEW OF MARKETING STRATEGIES IN RETAIL OUTLET LITERATURE SURVEY PROBLEM STATEMENT RESEARCH OBJECTIVES RESEARCH DESIGN RESEARCH LIMITATIONS PROFILE OF RESPONDENTS DATA ANALYSIS AND INTERFACES MAJOR FINDINGS RECOMMENDATIONS ANNEXURE PAGE NO 1 2-7 8-11 12-13 14-17 18-21 22-29 30-34 35 36 37-40 41 42-43 44-55 56-57 58-61 62-68
LIST OF TABLES
SERIAL TABLE NO 1 Disposable income Vs No of respondents in % 2 3 4 5 6 7 8 9 10 11 12 Expense on daily needs per month (Rs) Respondents who are buying from subhiksha How often respondents visit Subhiksha Outlet convenience Responses towards brands Media used for communication Response about lowest price in Subhiksha Pricing strategies of Subhiksha Response about pricing strategy Sales promotional activities at Subhiksha Responders ratings towards service activities at Subhiksha PAGE NO 44 45 46 47 48 49 50 51 52 53 54 55
LIST OF CHARTS
SERIAL NO 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 CHART Organized retailing in India Age profile Gender profile Profession profile Disposable income Vs No of respondents in % Expense on daily needs per month (Rs) Respondents who are buying from subhiksha How often respondents visit Subhiksha Outlet convenience Responses towards brands Media used for communication Response about lowest price in Subhiksha Pricing strategies of Subhiksha Response about pricing strategy Responders ratings towards service activities at Subhiksha PAGE NO 6 42 43 43 44 45 46 47 48 49 50 51 52 53 55
EXECUTIVE SUMMARY
The Indian retail sector is going through a transformation and this emerging market is witnessing a significant change in its growth and investment pattern. Both existing and new players are experimenting with new retail formats. Currently two popular formats -hypermarkets and supermarkets are growing very fast. Apart from the brick -mortar formats, brick -click and click-click formats are also increasingly visible on the Indian retail landscape. Consumer dynamics in India is changing and the retailers need to take note of this and formulate their market strategies and tactics to deliver value to the consumer.
The research that forms the basis of this dissertation was carried out at Subhiksha super market, an offline retailer based in Bangalore. The core business of Subhiksha is retailing of food products, fresh vegetables and pharmacy products on discount prices.
The main objective of this project is to formulate the marketing strategies of Subhiksha super market outlet in Bangalore. The research also involves analyzing the past promotional strategies and reach ability and also to determine the future promotional efforts of the company. The research finds that the Subhiksha retail outlet in Bangalore is formulating good marketing strategies which are useful the company and these marketing strategies are generating good result. But some improvements are required as per the respondents.
GROWTH OF RETAIL OUTLETS IN THE MODERN MARKETING SCENARIO
Organized food retailing is a relatively new phenomenon in India, with small Western-style supermarkets only starting to appear since the 1990s. Most food is still sold through local wet market vendors, roadside pushcart sellers or tiny kirana (grocery) stores. Although less than one per cent of food is estimated to be sold through supermarkets, this share is growing rapidly. Most supermarkets resemble the small independent operations that existed in Australian cities and towns about 20 years ago, typically occupying from 275-750 square meters and carrying about 6000 stock-keeping units. Most of the supermarket development has occurred in the south of the country in the major cities of Bangalore, Chennai and Hyderabad, as well as New Delhi and Mumbai in the north. According to the estimated 500 shopping malls are expected to be built by 2010 from a near-zero base in 2000, in a trend that can benefit Australian producers by providing greater visibility and shelf space. Convenience stores are also taking off in major cities, usually in the form of Shell shops or Food Stops attached to petrol station outlets. The format and product range is surprisingly similar to those in Australia, and they often include chilled and refrigerated sections. Market analysts estimate the organised retail sector has been growing by nearly 30 per cent a year since 2000 with similar growth likely in the short-to-medium term. The sector is expected to undergo further change with prospective new domestic and global foreign entrants, and the takeover or exit of some existing participants. Global players such as Wal-Mart (US) and Carrefour (France) have indicated their plans to enter India once Indian foreign investment regulations permit.
Food retailing in India Traditional local markets and small-scale retailing continue to dominate Indias food retail sector. There are an estimated 12 million retail outlets, of which almost seven million sell food and grocery products. The vast majority of these are small kiosks (17 per cent), general provision stores (14 per cent) and grocery stores (called kirana; 56 per cent of all rural retail outlets) run by a single trader and his family. With more than 71 per cent of the population living in small villages and engaged in agriculture, most of India still does its food shopping at small-scale vendors in the local village, or at larger-scale weekly markets often serving several villages in one area, where small individual vendors trade. In the towns and cities, most consumers do their food shopping at the local neighborhood independent small retailers, kiosks and street hawkers. Servants in high income households usually undertake this task. Most cities and towns also have one (or more) large central fresh produce market where wholesalers and retailers (plus some consumers) procure their supplies for the day from individual traders. The Food Corporation of India (FCI) has an extensive nationwide network of about 478,000 fair price shops and sells subsidized food grains and certain other staples, but since the retargeting of the Public Distribution System (PDS) in 1997 to focus on the poor, these are only available for those below the poverty line set by the government. There are also a few other chains of government-operated provisions stores, such as the Kendriya Bhandar (about 120 stores nationwide) run by the Ministry of Personnel, Grievances and Pensions, and the canteen stores (about 34 plus 3400 canteens) run by the Ministry of Defence, which are exclusively for Defence personnel. Thus the majority of food and beverage retailing in India is categorized as belonging to the unorganized sector. There is no firm data for the total value of Indias annual food and beverage expenditure, however there are various calculations and estimates, such as about US$90 billion by 2000 based on
the Indian governments estimates of average urban and rural household expenditure on food and beverages, and about US$135 billion by 2004 and growing at 4-5 per cent a year, based on industry estimates cited by the USDA. However it is commonly believed that less than one per cent of food and beverage retail sales take place through the organized retail sector, though this share is estimated to be growing rapidly. An early form of supermarket has been around in India for some time: the single-unit, smarter family owned grocery and provisions store, now calling itself a supermarket (while others may call it a super-kirana), of which there are at least five to 20 in each city. Another form is a specific food and grocery section contained in some department stores, such as the Sahkari Bhandar department store chain, which has about 16 stores in Mumbai. But it is only in the past decade or so that a form of supermarket akin to a Western-style supermarket, albeit on a smaller scale, has started to appear in India, mainly in certain cities of southern India plus in New Delhi and Mumbai. One of the pioneer supermarket chains was created in 1995 through a technical agreement (and from 1999 by a 51/49 joint venture) between Indias Calcuttabased RPG Group and the UKs Jardine Matheson Groups Hong Kong-based subsidiary Dairy Farm International. The joint venture converted the loss-making old Spencer department store chain owned by the RPG Group into the Food world supermarket chain, with about 94 stores in several southern cities, including Chennai, Bangalore, Hyderabad and Pune, by 2005. While Dairy Farm aims to continue expanding the Food world chain, the RPG Group decided in 2005 to sell its 51 per cent share in the Food world joint venture, though possibly retaining half the supermarkets rebranded as Spencers. RPG Group plans to focus on developing its other retail businesses including the Spencer hypermarket chain, which had three stores opened by 2005 (in Hyderabad, Visakhapatnam and
Mumbai), and a plan for 20 stores across India by 2007 in existing cities plus others such as Chennai, Bangalore, Delhi, Calcutta, Ahmadabad, and Chandigarh. Several other Indian-owned companies have developed chains of supermarkets, hypermarkets or convenience stores, mostly in major cities in the southern states plus in Mumbai and Hyderabad. Another pioneer, the Nilgiri supermarket chain, opened its first supermarket in Bangalore in 1971 and by 2005 had built a network of 30 stores, both company-owned and franchised, in the states of Tamil Nadu, Andhra Pradesh, Maharashtra and Karnataka. The Hyderabad-based Trinethra Group opened its first supermarket in 1986, expanded to 68 stores by 2004, then acquired the 12-store Fabmall chain in Bangalore, in partnership with a new 50 percent equity investor, Bangalore-based GW Capital, to enable further expansion into more states. Fabmall now has a total of 28 stores in Bangalore and Chennai. Other significant chains include the Subhiksha discount supermarket chain, with 72 stores in Tamil Nadu, and Pantaloon Groups 42 Food Bazaar supermarkets and Big Bazaar hypermarkets in major metropolitan centres. The Indian government has taken a cautious approach to allowing foreign direct investment (FDI) in food retailing (and retailing generally), with majority foreign ownership in food retail chains not allowed, and approvals generally given on a case-by-case basis. (In February 2006 the government made a small concession on FDI in retailing, by announcing that up to 51 per cent in retailing of single brand products would be allowed.) Since the joint venture of the RPG Group and Dairy Farm International was approved in 1999, only Germanys Metro Group (with two Metro Cash & Carry wholesale stores opened in Bangalore so far since 2002), and the South African-owned Shop rite Group in partnership with a local investor (with one Shop rite hypermarket opened in Mumbai in late 2004) have been permitted to set up operations. Local foodservice group Radhakrishna has also gained a license for food wholesaling in partnership with Frances Intermarch Group, whereby independent food retailers can sign up for use of the Spar store
brand. Several major multinational corporations, in particular Wal-Mart, have been lobbying the Indian government to allow majority foreign ownership in retailing. Wal-Mart has indicated that it would significantly increase its sourcing from Indian suppliers from its current level of US$1.5 billion a year (so far mainly non-food products, but likely to soon include some food products, such as basmati rice, tea, spices, seafood), if it were allowed to set up retailing operations. Major Indian retail groups, such as the RPG Group and the Pantaloon Group, have expressed their strong opposition to allowing more foreign direct investment into Indian retailing, especially majority foreign ownership. They argue that the sector is still at a very early stage of development and multinationals such as Wal-Mart would swamp local players, especially the kirana-wallahs.
However the Indian government appears to be considering some degree of liberalisation, in the interests of improving efficiency in retailing and supply chains and so strengthening the integration of the Indian agrifood market, plus opening possible new avenues for Indian exports via multinational retailers.
Organized retailing in India
Australian presence in India food retail outlet

Nearly all the major retail outlets, such as Food World, Metro and Nilgiris, sell Australian food but none of them imports directly. There are a number of importers and consolidators based in India that import food products from Australia and distribute to various retail outlets.
The Australian Food to Southern India partners are making significant progress in identifying potential retail partners for Australian exporters. The supply of grocery items destined for Indian retailers usually initially requires consolidation because of small volumes. Market entry best prospects Jams Pasta Sauces Biscuits Confectionary Bar syrups Honey Juices Wines Breakfast cereals Dietary foods Health supplements Canned seafood Tomato paste Ingredients for food service industry Canned fruit and vegetables Bakery ingredients bread improvers, multi-grain flour, essence, marzipan etc If market access is obtained, dairy butter oil, skimmed milk powder and specialty cheese Pulses mung beans, chickpeas, lentils and field peas Fresh fruits mainly apples and also pears, grapes, citrus and stone fruit
INTRODUCTION TO SUBHIKSHA
Founder Subramanian who did his B.Tech from IIT and PGDBM (MBA) from IIM, Ahmedabad has many first to his credit like starting asset securitization in early 90s, IPO financing in 94 and debentures trading. He has established Subhiksha departmental store at Tiruvanmiyoor, Chennai in March 1997.
Entering the retail market ten years ago There was no great logic behind entering the retail market in 1997. They made a study of two areas: software and retail. Between software and retail, they thought they were a bit late for software as Satyam, Infosys, Wipro, TCS, etc had already established by then. They didnt want to be a small and late entrant. In retail, they would be one of the early entrants, so they would have the learning curve much to their advantage. They allocated a Rs 5 crore (Rs 50 million) corpus to it and entered the retail business. There was a lot of thought process behind it. They wanted to attract not the top end customer but the aam aadmi. From their research of three months, they found that consumers prefer buying groceries from closer home. So, they decided to set up 1,000 sq ft shops all across the city and not a 10,000 sq ft big store at one location in Chennai. The next question was why would he come to our store abandoning the existing store? It had to be the price, because ultimately there is no difference between the branded products like say Boost or Surf or such things. So, they decided to sell branded products at a lower price.
On starting Subhiksha They looked at all sorts of names; and finally they chose the Sanskrit word Subhiksha (prosperity) because it reflects the Indian ethos and it is a word that can be understood all over India. What they were trying to do was different from the western model; their model is truly Indian. Their theme was, why pay more when you can get it for less at Subhiksha?
In March, 1997, they opened their first store in Thiruvanmiyoor in Chennai with an investment of around Rs 4-5 lakh (Rs 400,000-500,000). They opened it with the clear idea that it is part of a larger system. They thought the day they opened, there would be a stampede because the prices were low and they would sell goods of Rs 30-40 lakh (Rs 34 million) by the month end. But there was nothing of that sort! They sold goods of only Rs 5-6 lakh (Rs 500,000-600,000) in the first month.
Consumers were very surprised, and they gingerly looked at the products and asked, are they seconds or old stock or defective products? In the first year, they opened ten stores in Chennai. They also started selling medicines at a discount. On the third day of their opening the pharmacy, there were about 100 people outside their store in the morning. They thought all of them were waiting to buy from their store. What they were expecting on day one happened on day three, they thought happily. But they soon found that people who standing outside were not there to buy anything; they were chemists from the neighborhood who had come to do a dharna (protest) saying Subhiksha could not sell medicines at a discount.
Finally they had to go to court, and it was only in 1999 that the Supreme Court gave a ruling that they could sell medicines at a discount. Subhiksha is doing quite well on the pharma front and they enjoyed all the attention they got.
Another thing is the medicines that Subhiksha were selling at a discount were bought mainly by the elderly who have no fixed income and they welcomed any discount. Subhiksha people were quite happy to be able to help them in some way. Medicine retailing is more of a service than business for them. Of course, it is good business for Subhiksha too. But their main motto is service. Expansion plans By March 1999, Subhiksha started expanding rapidly. From 14 stores, they expanded to 50 stores by June 2000. In the next two years, they had 120-130 stores across Tamil Nadu. Another big thing was, in 2000, ICICI Venture invested in their company. Today, they have 145 stores all over Tamil Nadu. Subhiksha saw to it that the moment they got into a city, they started as many stores as possible there. Only that made business sense. Then, till 2004, they made sure that they consolidated before they expanded, though there was a lot of pressure on them to expand nationally. They decided to look at every part of India which is significantly literate and is a significant consumption market. Subhiksha wanted to be everywhere. They looked at the telecom companies as their role model because these companies employed capable regional managers and expanded.
Subhiksha business is also extremely local. They can't sit in Chennai and run a store in Chandigarh. They decided to have very good quality people to run the region, area, town and the store. In 2004-05, they decided to have 420 stores in places like Gujarat, Delhi, Mumbai, Andhra and Karnataka by 2006-07. In 2005, they started recruiting people in various regions. Subhiksha is already India's largest retail chain store with 500plus stores. They plan to have 1,000-plus stores by the end of this year. India is a large country and there are still opportunities to avail of. Though now, the thought of opening stores outside India is not tempting because there are enough opportunities in India. They may look at overseas markets too. Probably they open 2,000 or 2,500 or 3,000 stores in India.
SUBHIKSHA AT BANGALORE
Subhiksha, a Chennai based supermarket and pharmacy discount chain, opened the doors of its first store at Bangalore in the year 2005-2006. Subhiksha has now become Bangalores major discounter outlet. Right now in Bangalore Subhiksha operating 42 outlets and planning to open some more in couple months. They are in Bangalore with four major verticals viz Supermarket / Grocery, Fruit& Vegetables, Pharmacy & Telecommunication.
Some major events/milestones at Subhiksha in Bangalore 42 Subhiksha Fresh stores in operation at prime locations all across the Bangalore Software integration when fully operationalised and its a first initiative of its kind in Indian Fresh produce industry.
Soft launch Catchments and target customer focused low cost but highly effective promos. Full fledged media launch is there by which all businesses at stores going live. 60% of planned volumes and 80% Gross Margin targets in first fortnight of launch itself. Tremendous initial response, unexpected customer pull, good customer feedback Good business. Market information system designed and placed across all the retail, wholesale markets and supply areas in and around the metro city during last couple of months has started yielding dividends. Strategic teams for Backend (Sourcing & Procurement), Warehouse, Logistics, Front-end (Sales & Marketing), Market Information Systems, MIS, Merchandising, Training and Manpower Development getting handson experience. Teams are working 24x7 with great enthusiasm.
Warehouse, Suppliers, Hardware Vendors, Strategic Business partners, Collaborators, legal formalities and other backend infrastructure etc in real time test mode. No major hiccups or show stoppers. Stores fit outs and allied retail infrastructure is in various stages of readiness at many locations in Bangalore. Teams are raring to go for 2nd phase launch of another 30 outlets on second term of 2007. According to Bangalore Subhiksha executives, every outlets presence has registered a 300 per cent increase in footfalls and a 145 per cent growth in sales since the initial campaign was launched. Subhiksha allows a household to save around Rs 400 every month on its basic necessities. On a yearly basis, Rs 48,000 is what the average household spends on items such as groceries, vegetables and toiletries. This amounts to Rs 3,000-4,000 per month, and as Subhiksha offers an 8-10 per cent reduction in price on the same items/brands as other shops, the total saving is about Rs 400 a month.
OPERATIONAL STRATEGIES OF SUBHIKSHA

Subhiksha has not positioned itself against established players like Nilgiris or Food World in retail marketing, who have set up air-conditioned outlets. Rather, it aims to make its aggressive pricing strategy its brand equity against the neighborhood grocery shops. Mr K. Balasubramanian, Manager, Subhiksha Trading Services (P) Ltd, Chennai, told Business Line , ``The company is emulating the worldwide trend of garnering the benefit of organized retailing by efficiencies and economy of scale, which in turn brings down the cost to the consumer.'' Apart from the entire range of branded grocery and cosmetic products, Subhiksha retails medicines at lower prices. In fact, this aggressive pricing of medicines drew strong protests from organized pharma traders. The company was forced to approach the Supreme Court to ensure that its rights were protected and is able to procure and sell medicines at discounted rates to ``Subhikshites''. Explaining how his company was able to sell at a substantial discount to the MRP in spite of its overheads and investment in technology, Mr Balasubramanian said this was possible because of cost-cutting and elimination of waste wherever possible. Besides, it was able to offer sizeable discounts due to its bulk-buying strategy. Subhiksha believed that low margins and high turnover was better than high margins and low turnover. Even top retailers such as Wal-Mart, Metro, Tesco and Carrefour believed that low unit margins (therefore, low unit prices to customers) and high turnover are the ways to succeed in a very competitive environment and Subhiksha was the relevant model in Indian context.
Subhiksha efficiently operated on thin inventories and information technology. However, Subhiksha does not offer its customers the freedom to browse and shop like Nilgiris, Food World or Vitan retail chains. Because for buying cosmetics or grocery, customers look for a quick purchase rather than the shopping pleasure. Therefore, Subhiksha does not view this as a handicap. Subhiksha positioned itself as a destination store for the ``value-conscious'' customer. ``It is a functional and transaction-oriented shop that has no room for unnecessary frills and ambiences,'' On the limited choice for buyers in any particular product range, the company stocked two-three most popular brands in each category as was common with international discounters. This anyway constituted about 95 per cent of sales even in stores stocking larger number of brands. The idea was to stock fast moving brands and not those that had limited appeal. This also helped the company manage an inventory logistics and supply chain as also in offering lower prices. The chain was ``sensitive to customers' needs'', constantly adding or removing products based on customer feedback. Inventory Subhiksha has a centralized purchasing system. This eliminates multiplicity of billings, which would occur if the stores were to make independent purchases. It buys directly from distributors who sell at only a small margin above the mill prices and from 150 odd manufacturing companies. Subhiksha has 3 separate god owns for stocking Pharmacy products, unbranded groceries and branded FMCGs. It has a fleet of 10 tempos, which supplies its stores once a day. As the discount format requires holding costs to be at a
minimum all the stores are connected in an intranet to facilitate inventory planning. Subhiksha makes spot payments against delivery, which enables it to get cash discounts. The supplier helps in inventory control and in return gets an improved cash flow. Customer Education Subhiksha helps the consumer make informed buying decisions. Smaller packs of products in established brands are usually less economical. However, promotional offers by leading brands usually price smaller packs at lower prices to induce buying. For example the gingerly oil brand Idhayam was priced at Rs 14 for a 200 ml pack which works out at Rs 70 per litre while the 500ml was priced at Rs 36 which works out at Rs 72 per litre. Here, Subhiksha would inform buyers to purchase multiple packs of smaller quantities to save money. On products like tea, which have a nil tax on small packs and an 8 % tax on larger packs, the customers are encouraged to buy multiple units of smaller packs, which help them save money. Thus, Subhiksha strategy of having low real estate costs, quick inventory turns and informed customer buying has helped its meteoric growth. Price Control Subhiksha takes extreme care while pricing the products through all its stores. It has employed software, which evaluates the price by minimizing profits. Every store is computerized and utilizes the software to determine the pricing. This helps in ensuring that the products are rationally priced.
The success of Subhiksha indicates that the discount war will hot up in the coming months but it will be the customer who will emerge as the final winner. Subhiksha launches national campaign Discount retail chain Subhiksha has launched its first-ever national TV campaign following its recent expansion across the country. Launched in Hindi, the campaign depicts various shoppers looking for lower prices and opting to shop at Subhiksha, declaring that saving hard-earned money is "bachat mera adhikaar hai" (savings are my right). The company is spending Rs15 crore on this campaign in the first 12 months. Other media it is using include print, outdoor and radio. The ad agency in charge of the campaign is Orchard, Bangalore. Subhiksha Food Card ICICI Bank and Subhiksha have launched a pre-paid food card to be used as an alternative to the cash and meal vouchers. "We are delighted to offer a solution that helps cut down the hassle of carrying cash," said Ms Shanta Vallury, Dy general manager, ICICI corporate payment solutions group.
The pre-paid card, which is re-loaded on a monthly basis, will be accepted at all Subhiksha outlets throughout India and select restaurants. The card is first being launched in Delhi and would soon be available in Mumbai, Hyderabad, Bangalore and Ahmadabad.
KALEIDOSCOPE OF STRATEGIC MARKETING

Marketing has been defined as the management function responsible for identifying, anticipating and satisfying customer requirements profitably. Marketing is, therefore, both a philosophy and a set of techniques which address such matters as research, product design and development, pricing, packaging, sales and sales promotion, advertising, public relations, distribution and after-sales service. These activities define the broad scope of marketing and their balanced integration within a marketing plan is known as the marketing mix. A modification of a definition of marketing by Doyle (2000) suggests that marketing is the management process that seeks to maximize returns to shareholders by creating a competitive advantage in providing, communicating and delivering value to customers thereby developing a long-term relationship with them. This definition clearly defines the objectives of marketing and how its performance should be evaluated. The specific contribution of marketing in the organization lies in the formulation of strategies to choose the right customer, build relationships of trust with them and create a competitive advantage (Doyle 2000, p. 235). A marketing strategy consists of an internally integrated but externally focused set of choices about how the organization addresses its customers in the context of a competitive environment. A strategy has five elements: it deals with where the organization plans to be active; how it will get there; how it will succeed in the marketplace; what the speed and sequence of moves will be; and how the organization will obtain profits (Hambrick and Fredrickson 2001, p. 50). The organization must identify the problem that its customers use its products and services to solve. It is also necessary to identify the benefits customers seek from using a product or service available in the market. A market consists of all the
potential customers who share a particular need or want who might be willing and able to engage in exchange to satisfy that need or want.
A marketing orientation helps to define the organizations business. Marketing is concerned with problem solving and customer benefits. The organization must be able to answer the following questions:
What is the problem customers are trying to solve? What benefits do customers seek? How well does the organizations product solve this problem and provide these benefits?
A statement that the organization is in the movie business is not very useful. An organization is not in the movie business because that says nothing about customer needs. Some movie organizations assumed they were in the movie business when the entertainment business left them behind! Marketing is a philosophy that encourages the organization to ensure that the needs and wants of customers in selected target markets are reflected in all its actions and activities while recognizing constraints imposed by society. This marketing concept first received formal recognition in 1952 by one of its leading exponents, the General Electric Organization the marketing concept:
. . . Introduces the marketing man at the beginning rather than at the end of the production cycle and integrates marketing into each phase of business. . . . marketing establishes . . . for the engineer, the design and manufacturing man,
what the customer wants in a given product, what price he is willing to pay and where and when it will be wanted. Marketing will have authority in product
planning, production scheduling and inventory control, as well as in sales distribution or servicing of the product (General Electric Organization, New York, 1952, Annual Report, p. 21).
Three aspects of this statement are interesting: the customer orientation; the profit orientation; and the emphasis on integrated organization effort. These three aspects are fundamental to the adoption of the marketing concept.
Marketing means, therefore, being oriented to the needs of customers rather than emphasizing what is convenient to produce. Effective marketing requires that the organization analyses the needs that its products are supposed to satisfy. Customers do not buy coffee; they buy a warm stimulating drink or a unique coffee experience if it is Starbucks. Likewise, customers do not buy sisal; they buy a material to make baling rope to tie things together or fiber to serve as backing for a floor covering.
The organization should realize that many alternative products may satisfy the needs identified; there usually are many substitutes for coffee include tea, cocoa, alcohol or soft drinks and for sisal include polypropylene fiber or polythene sheeting.
The real lesson of a marketing philosophy is that better performing organizations recognize the basic and enduring nature of the customer needs they are attempting to satisfy. It is the technology of want satisfaction which is transitory (Anderson
1982, p. 23). The products and services used to satisfy customer needs and wants change constantly.
The adoption of a marketing philosophy confers specific authority and responsibility within the organization in regard to the provision, communication and delivery of customer value. Marketing is concerned with all parts of the organization; it is more than a set of tools, it is an orientation which pervades the thinking of the organization as a whole.
AN OVERVIEW OF MARKETING STRATEGIES IN RETAIL OUTLETS

Marketing strategies outline exactly how marketing objectives will be achieved. For example, if the marketing objective is to increase market share, the marketing strategy states exactly how the market share increase will occur. A marketing strategy is a way to give marketing orientation to a business by deciding to position a product or service in terms of buyer needs and wants. Inexperienced business people often make decisions based on what they like or want, leaving the customer out of the picture. A marketing orientation brings the customer into the center of the picture. The marketing objectives for profits, cash flow and market share can be achieved by increasing the number of users, increasing the rate of purchase, retaining existing customers or acquiring new customers.
Location
Competition, to most Indians, is good thing. It leads to better products and services at lower cost. It can inspire a retail manager to do a better job. However, numerous and/or aggressive competitors in a limited geographical area are costly to the retailer. Too many similar stores serving too few customers cause the sales volume of each store to suffer.
For some type stores, however, the best strategy can be to locate as close as possible to the competition. Competing stores located in the same area may in crease customer traffic. Some cities, for example, have an area with many antique shops. Customers are drawn to the area because of this convenience, and each stores traffic helps the other stores. Retailers should not afraid of competition, but
their mission statement should guide the finding of market where there is an unfilled demand for the type of store create shopping areas where customers can find everything they need in a single area.
The location strategy can be examined by mapping retailers according to the amount of traffic at location (pedestrian and/ or vehicular) and the retailers drawing power. The pedestrian or vehicular traffic is usually fixed at the location unless the retailer has the ability to draw customer to the area just because that is where the store is located. Drawing power represents the natural ability of the store to encourage customers to travel farther to shop there.
Merchandise Planning the merchandising mix is one of the most important aspects of store operations. The merchandise mix represents the full range of products the retailer offers to potential customers. The merchandise a retailer carries defines the store for the customer. Marketing the store as brand is another effective means of competitive differentiation based on merchandise rather than price appeal. This approach is heavily employed in United Kingdom and to a growing extent in the United States and other countries. One manner in which retailers examine their merchandising strategy is by using an assortment/variety graph. Variety refers to the number of different types or classes of products that a retailer carries. Retailer such as Target carries a large variety of merchandise, but a relatively small assortment. The assortment refers to the depth of a product line, or how many different styles and brands a retailer carries in each product line. Stores often have to make the choice to carry either a large assortment or a large variety.
Attempting to carry both would increase inventory costs to the point of being competitive. Price One way to examine the relative strategic positioning of a store is to plot your own retailer against competitors on a margin/turnover graph. To a large extent, these two variables will define not only the success or failure of the retailer but also how that retailer is perceived by the public. As per the graph, it is difficult, if not impossible, to maintain both high margins and high turnover. As retailers increase their process in an attempt to improve margins, customers start seeking competitors from which to purchase goods. In this instance, competition will quickly drive such a retailer out of business. Likewise, it is also impossible to maintain low margins and low turnover. In this instance, the retailers will not make enough money to survive. This leaves the retailer a choice of either a low margin-high turnover or a high margin-low turnover strategy. Discount stores depend partly on lower prices (and thus lower margins) to achieve the high rates of turnover that they need to be profitable. Where as specialty stores depend on higher prices to make up lower turnover. While turnover and margins are good way to examine a relative pricing strategy, this classification is insufficient by itself. Some Retailers found that high margins were insufficient to make up for lower turnover.
Others have run into the opposite problem-that of having a high turnover during sales at less than needed margins. During the mid-1980s Sears found it was having problems selling merchandise at full price. Most merchandise was being sold at the reduced margins as customers learned to expect periodic sales. Instead of paying full price, customers waited for the sale and bought merchandise at discount. This led to a customer image that was consistent with Sears strategy.
Service Each store owner-manager must determine the level of service that is appropriate for the store. This includes both the quality of services provided by the sales people and the quantity of associated services provided by the stores, such as gift wrapping and mailing.
It should be recognized that high levels of service increase cost, and unless increase in sales follow, it may be necessary to raise prices. Retailer must examine the character of the business to identify the features that can be best exploited to create a compelling point of differential from competition. In every type of retail business there are features and variables that, while shared by competitors, can be manipulated in a manner to establish a special character for a retailer over the competition. For example, all retailers provide service of some sort, but service can take many forms. If service is to be employed as a positive differentiator, the key is to understand what particular aspect of service is most appropriate for the type of merchandise being sold and is most important to the shoppers being targeted. While basic services are necessary for a retailer, many firms, such as Wal-mart and other discounters, have tried to minimize their cost. Other retailers have built a strategic advantage around the idea of providing better quality service than their competitors.
Communications Each retailer should have an overall strategy to reach potential consumers. One manner in which this strategy can be examined is in the context of the objectives of the promotional mix. There are four strategic dimensions that can be examined in the communication policy: Reach represents the number of people who will see a promotion or advertisement at least once, where as frequency is the average number of times that customer sees the advertisements. Most retailers use newspapers to communicate with the potential consumers. However, with the advent of inexpensive cable television, more retailers are depending on higher levels of frequency with less reach, to target a specific consumer group. The content of advertisement can be described as either image-or informationoriented. Many larger retailers use national television ads to promote the image of their stores. However most, retail ads tend to be oriented toward providing the consumer with store, product, and price information. Each newspaper carries a great deal of this type of ads. These ads tend to inform the consumer of the products being carried by the store and the price of the products.
Achieving strategic positioning Retailers depend up on the operations management, purchasing/logistics, market research, financing, and technology to achieve their strategic positioning. These variable acts as the tactics to achieve a given strategy. Their functions must be performed on a daily basis, often without the customers direct involvement, to ensure success. Operations The manager must pay the attention to the day to day requirements of running a retail outlet. Included in operations are staffing maintenance, and general management of the store. While each store should have a grand plan or strategy to compete, the daily operations will determine the success or ability to achieve a given strategy. The managers must ensure that the staff provides services consistent with the retail strategy and that the store appearance is maintained to provide an appealing atmosphere. Purchasing/Logistics Retailers are using purchasing and logistics as a competitive advantage. Integrated into the distribution system is the retail buyer. This person is responsible not only to maintain stock level in the store but also to ensure that the goods are those that the consumer wants. Stores are defined by the products that they choose to stock. Logistics planning is also becoming more a competitive weapon. For example, firms such as Wal-Mart use cross-docking, and The limited has reduced turnaround times because of its efficient distribution system. These and other firms have learned to substantially reduce costs or increase service to the customer by
better controlling the distribution channels of their goods. While these options have traditionally been reserved for only the largest retailers, new technologies in
distribution are allowing even the retailers who maintain more traditional distribution channels may find themselves left behind. Market Research In order to satisfy a customer and have store, as discussed later in the chapter, the retailer must be touch with consumer expectations, desires, needs, wants, and behavior. This is often accomplished through a formal market research program. Store managers should always keep in mind that their tastes and preferences do not represent those of the consumers. Too much inventory has been bought with the attitude of I like it instead of the consumer wants this. market research is also necessary to continually adjust to changing consumer trends. Financing The financial performance of a retailer is often viewed as an end retail result, instead of a planning function. However, store managers need to realize that financial planning is an imperative for success. This is often a weak area for store managers. For example, many small retailers are financed with short-term debt that causes problems as it comes due. Often, little attention is paid to the return on debt and equity. By planning for the future, retailers ensure that they have the capital to be successful.
Technology The use of technology has become so pervasive in retailing that it is often considered a strategic decision. In smaller stores technology is used as a support function for other functional areas of business. In retail chains and franchises, technology is often the centerpiece of the system. It allows corporate and store managers to interact on an efficient basis. Technology not only provides store managers with information but also reduces inventory losses and reduces costs.
LITERATURE SURVEY
Author- Neelkanth, from Bangalore, 27/March/2007 www.newretailindia.com
They are positioned as your neighbourhood kirana store with self service and home delivery options - that offers low(er) prices. The interesting thing is that everything in their store, and I mean everything is sold for below the MRP. This is how the kiranas have always done their business - so this about taking their war to them. Subhiksha also has discount pharma and a vegetable and fruits outlet.
When they launched in the area near us, assuming this is how they launch elsewhere, they made a small but significant splash. Door to distribution of membership cards, using the discount pharma (10% off MRP on everything, unlike your friendly neighbourhood pharmacist who charges "Local taxes extra" on the MRP) to attract customers to the other two (groceries and convenience store). With their home delivery option, in time, they may well cause a significant shift from the kirana.
Subhiksha still not have the reach (in terms of number of stores) or the width (they cannot stock as many different items as the local kirana guys) and are also quite constrained by the weights and measures (they sell their stuff packed, so you cant buy 250 grams of something if their package is half a kilo) - but within these constraints, they are a force to reckon with. Today, I would prefer to go to a retailer who bills me (and therefore I hope pays taxes) and someone who gives me more value for money. Therefore, if the impact is severe enough, kiranas may move away from some of the brands and move into the loose niche space.
By Ramesh, from Bangalore on 25/March/2007. www.newretailindia.com
We have covered the retail story quite closely, from the street. As the Retail market enters a steady state phase (its still a long way away), different formats are emerging. There are the Food Bazaar, Big Bazaars , Dmart and the Hypercity (Shoppers Stop group). Where does Subhiksha fit in? Subhiksha is a contrarian model - or an Indian model - call it what you like. It sort of merges the traditional small front end with the economies of scale of the modern back end.
Subhiksha, the shop is a rudimentary shop with racks having most (no the smaller stores do not have a huge variety to choose from) of what a basic shopper would need. The stores are not air conditioned, the receipts are printed on dot matrix printers (not in deskjet ones!!). They are very similar to what Margin Free in Kerala is or what Apna Bazaar or Sahakari Bhandar is in Mumbai.
Will the Subhiksha model succeed when an Apna Bazaar didn't - but Margin Free is a success for sure (more on that later). There is not a huge pricing differentitation between say a Lux soap offered in Big Bazaar v/s that of Subhiksha. Why should people shop in Subhiksha?
Can Subhiksha compete on merely pricing? May be it saves on store setup costs, power costs, but employee and supply chain costs will not vary by much because of its scale. My take here is that Subhiksha does not, unlike Big Bazaar, try and change the consumer behaviour - which is a big big plus point. Big Bazaar except for those who live near one, is a different behaviour. Drive down, stack grocery and shop once a month. Subhiksha says, just do your regular shopping, we are your regular shop, plus 10% every single time, every single item. Their vegetable
and medicine counter are also pretty good. Where Subhiksha takes a hit, more than the look of stores is stocks - here they have to improve.
Author-
Umesh
Hadagali
from
Bangalore
on
1/may/2007
www.newretailindia.com
Will people shop in a rudimentary outlet and save a rupee or two on products or shop in a Big Bazaar that offers more product categories, better ambience - almost like a one stop shop? Perhaps yes, perhaps no, but as of now, unless there is a Big bazaar near every Subhiksha one cant say, and then again we are comparing chalk and cheese. Who will win? Will it be just one winner? My take on it is that it will be Big Bazaar in the long run. Even as Reliance retail opens its doors to its first launch in Hyderabad, Subhiksha launches its newspaper in Bangalore. Yes, you heard that right.
As they say in an old saying, "Saam, Daam, Dand, Bhed" the retail wars will span all three. The newsletter is just one of the many missiles that will be used.
The newsletter explains very well why Subhiksha stores are always away from high streets (rentals), are not airconditioned (who pays for it), is sparsely staffed (who pays for those people?). It also talks about how Subhiksha offers consistent discounts and not bundled products and nor are their discounts promotional - it promises to offer a 10% off on all MRPs.
All of these are intended at Big Bazaar (and perhaps Reliance) among others and big stores that are airconditioned, have a lot of "smiling staff doing nothing" and
are located on prime property. The Subhiksha model is a low operating cost model which passes on the benefits to customers model and by locating themselves closer to their clients, they are pretty much top of mind recall for any grocery. We have seen that happen in our area where Subhiksha is doing pretty well and offers consistent discounts and overall it is a decent experience.
Author-Ravikumar on August 10.2006

Well that's what Subhiksha, the retail chain store that started in 1997 from Chennai means. Subhiksha, India`s largest discount retail chain, announced a Rs 550 mn. Rollout plan in Karnataka, by opening 60 outlets in Bangalore and Mysore, to be operational over the next 12 weeks. Here's the place in Bangalore - Indiranagar to be precise, which we patronise:
I have no qualms stretching money to the max. Many of us do. For people like us, there is a choice in such retail stores, the no frills, no fuss, no fancy stuff type. And who doesn't want discounts? All those who are lying raise your hands. Besides, who doesn't like a bit of honesty and homegrown, successful entrepreneurs? R. Subramanian is one such type. Why not encourage an Indian Sam-Walton in the making?
We're brutally honest people and we believe that there are a lot of people who love brutally honest businesses like ours. "...we also consciously make less money per rupee of sale but make it up with more sales. We are happy to earn 3 per cent on Rs 1,000 rather than 10 per cent on Rs 100." Its my belief that in a city like Bangalore where the ordinary, 'working class' citizens are in the 95% category and struggle to make ends meet, for whom 1015% annual increments, stock options, ESOPS etc make little sense, to whom malls & fancy cars are the stuff of dreams, retail/discount chains like Subhiksha will give more than the good things in life.
Problem Statement Formulation of operational marketing strategies for Subhiksha retail outlets in Bangalore.
RESEARCH OBJECTIVES To examine STPD of Subhiksha. To examine the locational advantage of Subhiksha outlets To scan the pricing strategies of Subhiksha To examine the promotional activities at Subhiksha To identify the growth and expansion potential in Subhiksha
RESEARCH DESIGN
This research investigation is company- specific and highly qualitative in nature. We sought to generate data through a structured questionnaire blended with personal interactions with all the key personnel of Subhiksha retail outlets and also with the customers. We contacted 100 customers, selected on the basis of stratified random sampling method. The data so generated is given qualitative treatment by using the qualitative instruments like rating scales; and inferences have been drawn accordingly.
TYPES OF RESEARCH The type of research method used for this project is Qualitative Research Technique. In this methodology, people were chosen randomly and were asked to respond to the questionnaire. They questionnaire has been designed in such a way that respondent feels easy to answer the questions.
SAMPLING TECHNIQUE In this project two types of sampling techniques are used. 1. Simple random sampling. 2. Stratified Sampling. Simple random sampling technique has been used for general questionnaire as it avoids any kind of bias in choosing the sample. Stratified sampling has been used to interact with Subhiksha outlet people.
SAMPLE SIZE The sample size chosen for the research is 100 out of which 95 are Subhiksha customers and the rest 04 are general people.
RESEARCH INSTRUMENT USED: The research instrument used for this survey is questionnaire. The reasons why this instrument is chosen are: It is free from all bias. It covers a wide area. It helps in getting original data. Not expensive. It is easy to tabulate and understand
DATA COLLECTION PROCEDURE
PRIMARY RESEARCH: The primary data is collected through interviews and questionnaire.
Interviews:
An interview can be qualitative, quantitative or a combination of both. In a quantitative interview, the questions are predetermined and presented together with multiple choice answers. Quantitative means that there must be measurable results. A quantitative interview is conducted in an investigating situation, which resembles an every day situation and an ordinary conversation. The answer to the questions shall be spontaneous and be a result of the interviewees own opinion.
Both, quantitative and qualitative interviews are mutually inclusive. In a quantitative interview the difficulty is in preparing the questionnaire whereas in qualitative interview a lot of effort is required for analysis.
The approach used in this research is qualitative interview methodology. We selected this methodology because it is considered easier to get the responses from the sample within a limited time frame.
SECONDARY RESEARCH The major source of secondary data has been internet from where collected all the relevant information available about the Subhiksha and about its marketing strategies.
We also collected information regarding the Subhiksha's operational strategies in Bangalore and the expansion strategies in Bangalore market. Various other information of interest has also been collected.
RESEARCH LIMITATIONS This research investigation is company-specific and is restricted to Subhiksha retail chain. It is also restricted to a limited sample size. The problem of generalization is, therefore, obvious Time and resource constraints
PROFILE OF RESPONDENTS
Age profile
Age (in years)
40-50 15%
>50 <20 3% 6%
20-30 42% 30-40 34%
<20
20-30
30-40
40-50
>50
Gender profile
Gender Profile
Female, 11
Male, 89
Male
Female
Profession profile
Occupation profile
Others, 10 Unemployed, 6
Self Employed, 2
Students, 18
Service person, 64
Self Employed
Service person
Students
Unemployed
Others
DATA ANALYSIS AND INFERENCE
1) How much is your disposable income? Table-1

Disposable income(Rs) 30,000 20,000 10,000 others No of people in % 40 30 25 5
Source: Field Investigation
Chart-1
Disposable Income Vs No of respondents in %
40 30
No of 20 respondents in %
10 0 30000 20000 10000 Others

Disposable Income( Rs)
Inference: We can infer from the above data that the customers of Subhiksha belong to upper lower, middle and upper middle class.
2) How much is your expense on daily needs per month? Table-2 Expense on daily needs per month (Rs)
7000 5000 4000 3000
No of people in %
25 35 20 20
Source: Field Investigation Chart-2

Expenses on daily needs per month(Rs)
35 30 25 20 15 10 5 0 7000 5000 4000 3000
No of people in %
Expense on daily needs per month(Rs)
Inference: we can infer from the above data that major of the respondents spend their half of the monthly income on their daily needs per month.
3) Are you purchasing all your daily needs from Subhiksha?
Table-3 People who are purchasing their daily needs from Subhiksha
Yes No
No of people in %
60 40
Chart-3
Respondents who are buying from Subhiksha
40% 60%
Yes No
Inference: 60% of respondents purchase from Subhiksha.
4) How often do you visit Subhiksha?
Table-4 Almost daily Weekly Monthly Once in a while 50 30 15 5 Source: Field Investigation Chart-4
How often people visit Subhiksha
50 40
No of people in %
30 20 10 0 Monthly Weekly Almost daily Once in a while
Inference: 50% of people visit monthly, 30% people weekly, 15% almost daily and 5% people visit once in a while.
5) Is this outlet convenience to your residential area?
Table-5 Outlet convenience

Yes No
No of people accepted in %
60 40
40% 60%
Yes No
Inference: 60% Subhiksha outlets are convenient to respondents' residence.
6) Are you getting the entire Domestic and International brands in Subhiksha?
Table-6 Domestic and International brands

Yes No
No of people responded in %
75 25

Responses towrds brands
80 70 60 50 40 30 20 10 0 Yes No
Inference: 75% people have stated that Subhiksha is offering domestic as well as international products but only a few international brands are offered
Responses in %
7) From which media Subhiksha is communicating with you regarding their services? Table-7 Media
News paper TV Hoardings Magazines
No of respondents in %
20 40 25 15

Media used for communication
40 30 Responses in 20 % 10 0 News paper TV Hoardings Magazines
Inference: Subhiksha is using many media for advertisement; TV ads are predominant and other media are also adequate enough to reach the customers.
8) Subhiksha has the lowest prices ever. Is this statement true compared to other retail service outlets?
Table-8 Response
Yes No
Responses 73 27 Source: Field Investigation
Chart-8
27%
73%
Yes
No
Inference: 73% of people state that Subhiksha is offering lowest prices.
9) What are the pricing strategies used by Subhiksha? Table-9 Pricing strategies
List price Discounts Allowance Payment period
No of people responded in % 80 5 5 5
Chart-9
Pricing strategies used by Subhiksha
80% 80 70 60 50 40 30 20 10 0
No of response
5%
5%
5%
List price Discounts Allowance Payment period

strategies
Inference: Subhiksha is using all kinds of strategies but discount strategy is mainly doing well.
10) Are you satisfied with the pricing strategy? Table-10 Response
Satisfied unsatisfied
No of response in %
65 35
Chart-10
Respondents reponse about pricing startegy
35% 65%
Satisfied
Unsatisfied
Inference: 65% of respondents are satisfied with its pricing strategy.
11) Sales Promotional schemes used by Subhiksha. Table-11 Sampling

Door-to-door sampling Event sampling
Discounts
Cash Discounts Trade Discounts
Guarantees
Refund of money replacements
Source: Field Investigation Analysis & Inference: We have given typical sales promotion schemes to respondents and they are asked to select those sales promotion schemes which are popular in their opinion. They stated that Sampling (Door-tosampling, Event sampling), Discounts (cash discounts and trade discounts), Guarantees, (refund of money and replacements) are very popular
12) How much do you rate customer service activities at Subhiksha? Mark 1 to bet the least and 5 to be highly effective. Table- 12 Ratings Responses in % 1 10 2 20 3 40 4 20 5 10
Chart-12
Responsers ratings towards service activiries at Subhiksha
40 35 30 Responses in 25 20 % 15 10 5 0 1 2 3 4 5
Ratings
Inference: Majority of the respondents stated that the customer service provided by Subhiksha is somewhat satisfied and some respondents stated that they are not satisfied.
MAJOR RESEARCH FINDINGS

Respondents who are making purchases under Subhiksha outlets are mainly lower, middle and upper middle class and these outlets are not so well modernized, not attractive for higher class people but more useful to the middle class people From those who are purchasing things in Subhiksha, only a few people are found purchasing their daily needs but some people visiting the store to buy because of discount price. Subhiksha outlets are situated in major places at Bangalore but these are not convenient to some customers and they have to travel from their residence and due to this, these customers visit on monthly basis and on daily basis. In Subhiksha outlets, popular brands are available. Some local brands and international brands are also available at discount prices. This is the main reason why Subhiksha outlets are doing well. Subhiksha launched TV advertisement campaign in Kannada and also in other regional languages; this helped the store to raise its market share in Bangalore. TV Ads in regional languages are more useful not only for customers and for the employees of Subhiksha also. Subhiksha advertises also through Hoardings, News paper and through Magazines.
Subhiksha mainly hits not only in Bangalore but also elsewhere in India because of its tagline Subhiksha has the lowest price ever". This tagline triggers customer traffic at the store. Even today Subhiksha is selling its Food products, Pharma and Fresh vegetable at discount prices.
Subhiksha mainly attracts the customers mainly because of its pricing strategy not by its ambience. Subhiksha focuses more on pricing strategy Apart from price incentives, Subhiksha also uses other sales promotional devices like Sampling and guarantees. The customer service provided by Subhiksha is good
RECOMMENDATIONS
We recommend that the following 'marketing nutrients' be incorporated by Subhiksha in its marketing strategy:
Improvement is needed in pharmaceutical section, because most of the times prescribed medicines are not available in the store TV Ads in regional languages need to be continued, as TV is found to be an effective medium Better utility products should be made available Aggressive promotional schemes should be used, particularly the use of membership of the store More spacious outlets are required Customer care mechanism has to be activated more rigorously so that the customers' shopping experience is enhanced Subhiksha should focus on the store ambience, sophisticated visual merchandizing practices shall be hallmark of the store Convenient store layout is very much required Adequate parking faculties must be provided to ensure ease of shopping Hygienic rest room facilities must be provided Subhiksha should develop its own website e-shopping facilities are needed Delay in home delivery system shall be avoided
In the sum, we recommend the adoption of strategic marketing by Subhiksha in order to reap good results from its retail operations. What is required is strategizing its retailing operations. We give below the strategic marketing inputs which can profitably be applied in this task of strategizing the retail operations:
ANNEXURE
1. Select Bibliography:
(a)Books:
1. 'Retailing' by Roger Cox and Paul Brittain. Pearson Education Publications, Fifth Edition, 2006 2. 'Retail Management--A Strategic Approach' by Barry Berman and Joel R Evans Pearson Education Publications, Ninth Edition, 2006 3. 'Retailing in India' Edited, ICFAI Publications, 2006 4. 'Retailing: General' by Standard & Poor's Surveys 2002 5. ' Retailing Specialty' by Standard & Poor's Survey 2002 6. 'Selection of Retail Locations' by Richard L Nelson, F W Dodge Publications, New York, 2000 7. 'Retailing on the Move: An Era of Change' by Thelma Snuggs, Black Collegian Publications, 2000 8. 'Marketing: Real People, Real Choices' by Michael R Solomon and Elnora W Staurt, Pearson Education Publications, Third Edition, 2006 (Chapter on Retailing) 9.' 'Marketing' By Evans and Burman, Wiley Eastern Publications (Bizantra) 2006 (Chapter on Retailing)
(b). Journals & Magazines:

Journal of Retailing Journal of Marketing Retail Biz Journal of Marketing Research Harvard Business Review Marketing Mastermind Strategist (Business Standard) Brand Equity (Economic Times) Catalyst (Business Line) Business World Fortune
. Websites used: www.thehindubusinessline.com www.sify.com www.startupavenues.com www.newretailindia.com
2. QUESTIONNAIRE: I am a student of M P Birla Institute of Management, Bangalore pursuing MBA Program. As a part of the MBA curriculum, I am carrying out a research investigation on 'Marketing Strategies of Subhiksha', Bangalore. In this connection, I need some information from you. Listed below are some questions. Kindly give your responses to them. I sincerely assure you that the information so provided will be kept confidential and shall only be used for academic purpose. Mr. Hiresh Lamani
Name: ------------------------------------------------Age: -------------- Sex: -------------- Place: ---------------------------Profession---------------------------
1. How much is your monthly disposable income?
2. How much is your expense on daily needs per month?
3. Are you purchasing all your daily needs from Subhiksha? Yes No
4. How often do you visit Subhiksha? (A) Almost daily (B) Weekly (C) Monthly (D) Once in a while 5. Is this outlet convenient to your residential area? Yes No
6. Are you getting the entire Domestic and International brands in Subhiksha? Yes No
7. From which media Subhiksha is communicating with you regarding their services? News paper TV Hoardings Magazines
8. Subhiksha has the lowest prices ever. Is this statement true compared to other retail service outlets? Yes No
Mention some products 9. What are the pricing strategies used by Subhiksha? List price Discounts Allowance Payment period
10. Are you satisfied with the pricing strategy? Yes No
11. Please tick the appropriate items from the sales promotion schemes listed Below which are currently available at Subhiksha: (a) Sampling Door-to-door sampling Sampling through mail In-store sampling On-package sampling Event sampling Inserts in magazines and newspapers requesting samples by phone and use of specialized sample distribution services Internet is yet another way companies are making it possible for consumers to sample their products. There are several online sampling services such as Catalina marketings ValuPage.com and the Sunflower Groups SitelinkPlus
(b) Couponing Premium offers Free premiums: usually inexpensive gifts or items that are included in the product package, distributed with a purchase or sent to consumers who make mail-in-requests along with a proof of purchase. Self-liquidating premiums: those that require the consumer to pay some or all of the cost of the premium plus handling and mailing costs. Selfliquidating premiums can be used to create interest in a brand as well as generate goodwill that enhances the image of a brand (d) Contests & Sweepstakes Types of contests: Photographic Reason-why Sentence completion Lucky baby Coloring Special skills Slogan writing Story writing Picture title Beauty contest Recipe contest Word building (e) Refunds & Rebates (f) Bonus packs (g) Discounts: Cash discount Trade discount Quantity discount Promotional discount (h) Price Deals (i) Frequency programs
(j) Guarantees
Refund of money Replacement Remedy Augmented cash guarantee Competitive guarantee
12. How much do you rate customer service activities at Subhiksha? Mark 1 to be the least and 5 to be highly effective. 1( ) 2( ) 3( ) 4( ) 5( )
13. Please give your recommendations to enhance the utility of the services of Subhiksha---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
THANK YOU FOR SPARING YOUR VALUABLE TIME FOR GIVING YOUR RESPONSES
3. DIRECTIONS FOR FURTHER RESEARCH

The following areas have been identified (carrying considerable research potential) for further research: Customer Perceptions/Expectations of Services Provided by the Store Customer Satisfaction Survey by using the Multi-Attribute Analysis Brand Image Study of the Store Taxonomy of Visual Merchandizing at the Store A Diagnostic Study of Supply Chain Management at the Store Mapping Retail Stores Personality
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Marketing Strategies of Subhiksha Retail Outlet in Bangalore 1

MARKETING STRATEGIES OF SUBHIKSHA RETAIL OUTLETS IN BANGALORE

M.P.Birla Institute of Management

Marketing Strategies of Subhiksha Retail Outlet in Bangalore 2

Place: Bangalore Date: (Hiresh Lamani)

M.P.Birla Institute of Management

Marketing Strategies of Subhiksha Retail Outlet in Bangalore 3

Place: Bangalore Date:

(Dr. Nagesh S Malavalli) Principal

M.P.Birla Institute of Management

Marketing Strategies of Subhiksha Retail Outlet in Bangalore 4

Place: Bangalore Date:

(Dr K V Prabhakar) Senior Professor

M.P.Birla Institute of Management

Marketing Strategies of Subhiksha Retail Outlet in Bangalore 5

Place: Bangalore Date: (Hiresh Lamani)

M.P.Birla Institute of Management

Marketing Strategies of Subhiksha Retail Outlet in Bangalore 6

M.P.Birla Institute of Management

Marketing Strategies of Subhiksha Retail Outlet in Bangalore 7

M.P.Birla Institute of Management

Marketing Strategies of Subhiksha Retail Outlet in Bangalore 8

M.P.Birla Institute of Management

Marketing Strategies of Subhiksha Retail Outlet in Bangalore 9

M.P.Birla Institute of Management

Marketing Strategies of Subhiksha Retail Outlet in Bangalore 10

GROWTH OF RETAIL OUTLETS IN THE MODERN MARKETING SCENARIO

M.P.Birla Institute of Management

Marketing Strategies of Subhiksha Retail Outlet in Bangalore 11

M.P.Birla Institute of Management

Marketing Strategies of Subhiksha Retail Outlet in Bangalore 12

M.P.Birla Institute of Management

Marketing Strategies of Subhiksha Retail Outlet in Bangalore 13

Marketing Strategies of Subhiksha Retail Outlet in Bangalore 14

Organized retailing in India

M.P.Birla Institute of Management

Marketing Strategies of Subhiksha Retail Outlet in Bangalore 15

Australian presence in India food retail outlet

M.P.Birla Institute of Management

Marketing Strategies of Subhiksha Retail Outlet in Bangalore 16

M.P.Birla Institute of Management

Marketing Strategies of Subhiksha Retail Outlet in Bangalore 17

M.P.Birla Institute of Management

Marketing Strategies of Subhiksha Retail Outlet in Bangalore 18

M.P.Birla Institute of Management

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M.P.Birla Institute of Management

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OPERATIONAL STRATEGIES OF SUBHIKSHA

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M.P.Birla Institute of Management

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M.P.Birla Institute of Management

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M.P.Birla Institute of Management

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KALEIDOSCOPE OF STRATEGIC MARKETING

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M.P.Birla Institute of Management