Description
strategic mangement
INTRODUCTION
The BATA shoe organization is one of the world's largest manufacturers and retailers of footwear. The company rapidly expanded after its foundation in 1894 and by 1930's its operated in Switzerland, Germany, England, France, Yugoslavia, Poland, India and Holland. This expansion continued and by 1960, Bata employed over 42,000 employees, owned thousand of company stores and many factories across the world including almost every continent. It has a retail presence in over 50 countries and production facilities in 26 countries. The company has sold more than 14 billion pairs of shoe till now. Every day about 1 million customers are being served throughout its 4,600 retail stores worldwide. The company was founded in 1894 in Zin by Tomas Bata whose family had been cobblers for generations. A large order from the army, military shoe and rising demand for them, during World War I started rapid growth and small manufacture turned into modern industrial concern, one of the first mass producers of shoe. ? TOMAS BATA: Tomas Bata was recognized for his social conscience,
establishing housing, cinemas and advancement programs for his employees. He saw technology as a mean of progress, and wanted to make the shoe as cheaply as possible so that the greatest number of people could access them. He employed 16,560 people, maintain 1645 shops, and 25 enterprises. The total international contribution to the Bata organization at the time of Tomas' death consisted of 20 international enterprises, 132 shops, and 790 employees. ? JAN ANTONIN BATA: After Tomas Bata's plane crash his half-brother Jan
Antonin Bata becomes head of the company; at this time company continues the diversification into the production of tires, aircraft, bicycles, machineries. Under Jan Antonin Bata the company grew quickly, continued its expansion throughout Europe, North America, Asia and North Africa.
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BATA IN INDIA The company was incorporated in the year 1931 as Bata Shoe Company Pvt. Ltd. in Konngar, West Bengal, which was then shifted to Batanagar. Batanagar was the first manufacturing facility in the Indian shoe industry to receive the ISO 9001 certificate. The Company went public in 1973. They changed their name to Bata India Ltd. Over the years Bata India has established a leadership position in the footwear industry and is easily the most trusted name in branded footwear. The company has entered into an agreement with Bata Ltd of Toronto, Canada for supply of technical know- how and services such as footwear technology and design, brand development, product development, retailing and information systems for a period of ten years from January 1, 2001. The company bagged the Retailer of the year award for the year 2006 in the footwear category as a part of the Reid and Taylor Award for Retail Excellence which was presented during the Indian Retail Summit 2006. Bata was honoured with Most Admired Brand of the year 2006-07 in Footwear category. They have been rated as one of the Top 10 super brands in India and awarded Super Brands Award on April 12 2007.Bata has entered into the retail segment and is currently has 1250 stores all over India. For a shoe manufacturing company, brand image depends on various variables like variety of product, availability, price, convenience of location, durability etc. This research is aimed to reveal these variables and their level of influence on the brand image of Bata. The Indian footwear giant Bata is overhauling its retail strategy by getting back into the fast track by devising three strategies. These strategies are to set up 60 large format stores, closing its non profiting stores and by increasing its sales to institutional businesses. Also Bata has recently opened 32 retail stores in a minimum area of 3,000 sq. ft each, defying the trend in the retail industry of putting expansion plans on hold. The stores operate in a four-tier retail format under a new model -- up market flagship stores, smart and trendy city stores and super stores and traditional family stores. These largeformat stores are mostly franchise-run and have helped Bata to bring its contemporary and trendy range of footwear sold in an international style outlet to customers even in
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small towns. The idea behind the adoption of these strategies is swift expansion and up gradation. Bata is also following its second strategy by reducing the number of its unviable stores from 140 to 74 and is ready to shut down more such stores in future. Along with this, the company has also focused upon providing the customers with a novel trendy collection and better shoe designs. The company is also depending on institutional business by starting tailor-made shoes for hospitals, military forces, factory workers and airlines. Bata has already set up a dedicated team headed by a retired Defense man to secure contracts as Defense authorities currently source most of its footwear requirement from unorganized players. The country has 45 million workforce in various manufacturing and mining sector and the company sees this as a good business opportunity. Parent group Bata Worldwide would be providing technology sourced from the Safety and Industrial Centre at Holland. Bata is the largest shoe company in India in terms of sales and revenues. It commands around 35 percent of market share in India. Company‘s 98 percent revenue comes from domestic operation. It owns about 1250 stores spread across India. The company which demonstrated the highest degree of early commitment to the Indian market was obviously Bata, The shoe major invested in a fairly elaborate distribution network with company owned retail shops in even small towns. Bata also took the bold step of targeting the mass markets instead of just milking the premium segments. It targeted middle class Indians with value-for-money products. Indeed, many Indians do not know that Bata is an MNC. In targeting up-market segments, however, Bata began to deviate from this strategy in the late 1980s. Then Bata realized to change its strategy and aligned towards addressing a larger pie, introducing newer product lines and new brands. Bata was also focusing on 'quality sales' with stress on consumer satisfaction as it found that quantity sales could increase the turnover, but quantity without quality would only destabilize the consumer confidence that had taken ages to build.
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MISSION AND VISION OF BATA Bata Shoe Company has been successfully running for years with a mission and vision at the heart of all its operations. MISSION ?Introduction of a strong shoe line targeted to various market segments to maintain leadership through increased market share.? VISSION ?To provide good quality shoes at an affordable price by keeping in mind the comfort that needs to be there and providing new designs with it.? INITIAL POSITIONING AND SUBSEQUENT REPOSITIONING Bata has positioned itself as a one stop family store for all footwear and related products. It has traditionally positioned itself as providing product lines catering to the middle class segment of the society; it has also tried targeting the high class customers. Bata had become a need brand .In terms of the needs, Bata was in a way successful in positioning itself as a brand having stores with products to meet the needs of almost all members of the family, since it had product ranges for children, men, women etc. Till the 1980s, Bata enjoyed an almost monopolistic position in the organized footwear market. It‘s simple, yet iconic, brown leather sandals and blue-and-white rubber slippers were instantly recognizable and also are still recognized. Bata was the choice for everyone in the family. Whether it was shoes for the monsoon, school shoes, formal wear or even comfort wear for the elderly, the brand had something for every member in the Indian household. There was a period in the past in India when anyone mentioned shoes or chappals, there would be a single name Bata. It was one of the most popular names after Tata. The brand Bata was household name then. It ruled market as leader till recent years when various national and international brands came up. The Bata shoe lovers were so addicted with Bata for them thinking shoes other than Bata was an unpatriotic act. People wore Bata proudly.
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It has also come out with new set of brands like hush puppies, Marie Claire brand offering the latest patent, metallic and ethnic styles in footwear. The recently introduced ladies hand bags have also met with a very good response from the youth. Sandak, Batalite and Sunshine labels has continued to allure millions of customers with trendy and lightweight all-weather footwear as these footwear are very light . Bata was considered as manufacturing oriented company who concentrate on producing footwear and sell them in market at anyhow. Bata wanted to change this image of production oriented company to affordable, market driven, fashion conscious, lifestyle brand that is why Bata wanted to reposition itself. Bata is trying to move out of this image of an age old seller of their manufactured goods. They are now concentrating on "product that the customer wants rather than products that they produce." Bata India in a complete process to change from its earlier image. Bata was considered as manufacturing oriented company who concentrated on producing footwear and sell them in market at anyhow. It wanted to change its image from a manufacturing company to a marketing company. Bata wanted to change this image of production oriented company to affordable, market driven, fashion conscious, lifestyle brand. They are focusing on a better brand recall by opening bigger stores in malls etc. It has revamped its stores to look more contemporary, shedding its age old image. The company has decided to be more visible in shopping malls, open up to the franchisee model and also create the shop-in-shop experience in a multi-branded store. A step towards rejuvenating the Bata brand, the company is repositioning itself as a market driven, fashion conscious lifestyle brand with an emphasis on service and production. The company recently introduced international styles and trends for women, men and kids, which have gone a long way in providing a trendy and contemporary image to the company. Revamping its marketing operations, Bata India has introduced the concepts Flagship, City, Family and Bazaar stores that cater to different segments of the market. Further, to capture the retail boom prevailing in the country, the company has decided to move its headquarters to Gurgaon this year. They are also intending to make the shopping
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experience better to their customers by employing skilled salesperson & creating a better ambience. Few Examples are: Hush puppies
This unique invention would not only change the kind of shoes we wear, it would also herald the beginning of today's relaxed style. ? ? Bounce technology for shock absorption and energy return in every step. 100% relax Hush Puppies collection of innovative, authentic casual footwear, mixed textures of soft casual leathers and rich Hush Puppies worry-free suede. North Star: North Star is with street creed. Stylish, trendy comfortable and durable, the range is ideally suited to the urban environment. The youth market is attracted to the brands retro styles, including designs from the late 80s as well as contemporary interpretations, making it a highly sought after brand name. It's a casual yet fashionable street-style shoes that caters to the young at heart. Marie Claire: Marie Claire, a fashion lifestyle brand of shoes with a touch of elegance that caters to the young cosmopolitan women. Bata Brands is the trademark owner of Marie Claire for shoes worldwide. Marie Claire stands for Contemporary and modern styling, adaptive to an active lifestyle yet elegant and feminine. Subtle fashion trend details and quality products with a clean finish, it is a brand that brings out every woman's confidence & individual style.
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ANALYSIS - I
MARKETING RESEARCH ON BATA Marketing research is "the process or set of processes that links the consumers, customers, and end users to the marketer through information — information used to identify and define marketing opportunities and problems; generate, refine, and evaluate marketing actions; monitor marketing performance; and improve understanding of marketing as a process. Marketing research specifies the information required to address these issues, designs the method for collecting information, manages and implements the data collection process, analyzes the results, and communicates the findings and their implications It is the systematic gathering, recording, and analysis of qualitative and quantitative data about issues relating to marketing products and services. The goal of marketing research is to identify and assess how changing elements of the marketing mix impacts customer behavior. The term is commonly interchanged with market research; however, expert practitioners may wish to draw a distinction, in that market research is concerned specifically with markets, while marketing research is concerned specifically about marketing processes. Marketing research is often partitioned into two sets of categorical pairs, either by target market: ? ? Consumer marketing research, and Business-to-business marketing research
Or, alternatively, by methodological approach:
? ?
Qualitative marketing research, and Quantitative marketing research
Consumer marketing research is a form of applied sociology that concentrates on understanding the preferences, attitudes, and behaviors of consumers in a market-based
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economy, and it aims to understand the effects and comparative success of marketing campaigns. The field of consumer marketing research as a statistical science was pioneered by Arthur Nielsen with the founding of the ACNielsen Company in 1923. Thus, marketing research may also be described as the systematic and objective identification, collection, analysis, and dissemination of information for the purpose of assisting management in decision making related to the identification and solution of problems and opportunities in marketing. IMPORTANCE OF MARKETING RESEARCH FOR BATA ? To make marketing decisions
:Marketing research helps the marketers to make a decision about the product or service. Sometimes a marketer might believe that the new product or service is useful for the customers. Good marketing research strives to provide options for the successful introduction of new products and services. This makes the market entry of a new product less risky. ? Survive the competition
Marketing research helps in ascertaining and understanding competitor information such as their identity, marketing network, customer focus and scale of operations. With market research one can understand the under-served consumer segments and consumer needs that have not been met. ? Help to decide target markets
Research helps in providing customers information in terms of their location, age, buying behavior etc. this helps the marketers zero in on the target markets and customers for their products. ? Maximize profits
Apart from profit maximizing steps such as item optimization, customer profitability analysis and price elasticity, marketing research allows one to find out method that can help to maximize the profits. ? Increasing the sales
Increasing the sale helps a company in maximizing its profits. By understanding the
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Customers needs, wants and attitude towards the products and determining whether the product fit the bill, market can increase their sales. ? Consumer perception
It is an important aspect for any industry. Perception is the process by which people select, organize and interpret information to form a meaningful picture of the world. Every day people are exposed to a great amount of stimuli .not all stimuli attracts customers. People also forget whatever they have come across. Bata Use of social networking to overcome inter-generation effects Consumers have forgotten that Bata is a foreign brand due to the long history of the brand in India and its proliferation across the length and breadth of the country. Bata should build a favorable image by the source of internet to combine multiple messages targeted at multiple stakeholders through two-way communication which will increase the involvement levels. Social networking websites and blogs on sport websites , promotion on online gaming ,advertisements on sports news aggregator websites etc. will enhance the image of the brand and create a favorable attitude towards the ad and brand leading to purchase decision. People‘s perception of something can vary greatly from person to person, with each one forming an individual opinion about the stimuli being received. Perception is one of the key psychological factors that influence consumer behavior. The role of perception in consumer behavior is all about recognizing how consumers view a company‘s product. A consumer for buying a particular product often comes down to image. People wish to be perceived as having the ability to make the right? choice sand pick the right products. Marketers use perception to target peoples need to fit in and be a part of a larger group of consumers. Reasons why Bata shares are rising This reports talks about reasons for rising Bata‘s shares. Reasons being: ? ? Shares of footwear maker Bata India traded nearly 7% higher at Rs. 775 on the Bombay Stock Exchange. According to the budget Proposal, Excise Duty exemption on non-leather footwear has been enhanced from Rs. 250 to Rs.500 per pair. Non –leather
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footwear above Rs. 500 per pair will now attract excise duty of 12% from 10% earlier. ? 30% of Bata‘s sales are from canvas and plastic, hence subject to an exemption from the duty. ? Bata pays about 1.5% of sales as Excise duty.
Other factors being culture, family, peers, status, occupation, economic situation, lifestyle etc. ? To investigate about the perception of the consumers
For every company, it is very important to know how the customers perceive its brand. Bata have been perceived as a brand focusing on middle and upper middle class. Consumer perception is not constant it keeps on changing. ? To analyze competitor‘s strategy in the market (Liberty, Relaxo) For every company it is important to keep an eye on what the competitors are up to. It‘s a Competitive world every company tries to bring its product in such a manner that it gets quickly accepted by the audience. Bata till now has been able to secure its position from the rest. ? To know the most effective media or source for the advertisement : Bata has lacking in its promotion. in order to survive in today‘s competitive world and keeping a pace with them it is important for Bata to come up with brand new advertisement be it newspaper or television. E- Marketing is equally important. ? To know the market potential of Gurgaon
:Bata is a well-known brand in India. But it is important to know how the people of Gurgaon perceive it. Is Gurgaon contributing to the market share of Bata as a whole? ? To know future expectations of the buyers
:It is important to know what customers expect out a brand. Do customers prefer Bata for casual footwear or formal footwear? Either they want more variety for both the segments or changes in the existing segment. ? To determine the importance of various attributes of the buyers regarding the choice of their footwear
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:It is crucial for the company to know what attribute of Bata attracts consumers. Attributes are quality, durability, price, etc. ? To determine the annual expenditure affordable by majority of the people or customers on their footwear .
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GLOBAL MARKETING STRATEGIES OF BATA Today Global Marketing is one of the most exciting fields of business. Global Marketing refers to marketing activities coordinated and integrated across multiple country markets. The integration can involve: ? ? ? ? ? ? standardized products, uniform packaging, identical brand names, synchronized product introductions, similar advertising messages, and Coordinated sales campaigns across markets in several countries.
Now a day, there are several global organizations operating in our country following global marketing strategy and tactics. One of such organization is BATA Shoes. Bata Shoes is a large, family owned shoe company. Bata is one of the world's leading footwear retailers and manufacturers with operations across 5 continents managed by 3 regional meaningful business units. The meaningful business units approach provides quality resources and support in key areas to the companies operating in similar markets such as product development, sourcing or marketing support. Each meaningful business unit is entrepreneurial in nature, and can quickly adapt to changes in the market place and seize potential growth opportunities.
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GLOBAL COMPETITORS FOR BATA
Bata has a 13.7 percent market share. It also has to face tough competition from many organized and unorganized sectors. Bata has overcome all the competitors and well sustained with a good market share .it has to watch the other manufacturers and make a counter move to match the competitors move. Leading competitors are Lakhani Shoes, Apex, Liberty Shoes, Action Shoes, Reebok, Woodland, Paragon and Relaxo in organized sector. Unorganized Sector: It has to face a major competition from Chinese footwear market which is imported from china .because Chinese footwear entered Indian market , Bata has to change its policy and also had to face major financial loss. Which also led to fall of Bata‘s market share to 10%.which was a major setback for Bata India. Ba ta then stopped concentrating on lower segment (in which Chinese had an edge: low price) which led Bata to concentrate on other segments like on premium brands also. Bata faces the most competition from the ladies footwear division and that too from the local unorganized shoe manufacturers and Chinese shoe makers.
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ANALYSIS OF COMPETITORS ? Apex: Most of their shoes are expensive. They don't provide any school shoes.
The sports shoe they bring into the market are mostly imported "Addidas" shoes and quite expensive. In the men's section the most dominating colour is black, in women section black and chocolate. They provide sophisticated colour shoe for children. The most dominating sizes of the men, women and children are the average sizes that are sold in any Bata store. They remain open on everyday of the week except any government holiday. Opening hour is 9.00AM-10.00PM. They generally implemented new design after every 6 months according their employees. The most successful sales campaigns are 60% off on specific design. Their market share is about 1.50% in Bangladesh. ? Liberty: Here in this shoe stores the average price of the shoes are also
expensive. Their average retail price is 600+. They also have the same kind of offerings in their respective divisions. Usually the normal colour and size that are sold elsewhere also sold here. They remain open every day except of any government holidays. They open at 10 in the morning and remain open up to 10 in the evening. After 3-6 months they brought new design shoes in the market. The most effective sales campaign is 4060% discount on specific design shoes. The market share of Liberty shoe is about 1%. They are in the market for about 13 years as a franchisee they are from India. ? Reebok: They only sale sports shoes and some children shoes who are
in their teens. The price of all shoes is high 1200+. The colour and design of their shoes are of high quality. Reebok brings different types T -shirts, tracksuits and non-shoes items, which are quite expensive. A fter every 1-2 months new design of shoe comes in their store. 20 -25% discounts on specific design are their most effective sales campaign. About 10% market share Reebok is quickly gaining ground and getting attention of the brand conscious segment of the country. ? Nike: Same as Reebok, Nike only offers high quality sports and some
children shoes. Their shoes are also expensive sports shoes ranging from 2000-5000, which are sold most. Best-sold non-shoe items such as T-shirt,
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tracksuits are ranging from 750-2250 taka. They open their store everyday of the week. They brought new design in the market after every 3 months. They don't have any sales campaign up to now. Same as Reebok but their market share is less than their international rival as they have enter Bangladesh market for 6 or 7 years. ? Woodland: Trendy high quality shoes for all. They don't provide
school shoes. Dust, Brown and Green are their dominating color in every category. They have lots of non-shoes item like T-shirt, trousers, and shoe polish. The most popular price ranges among those are 695 -1395 taka. They open every day from 10.00-9.00. It brings new design in after 3 -4 months. The effective sales campaign is same as Reebok. Very good quality trendy shoes which quickly gaining ground in the country. This is the same company that brings Reebok in the country as franchisee. ? Pegasus: They made their name as sports shoe manufacturer. After that
they come up shoes for both the male and the women. Their best -sold price range is 800-1200 for men, 550-750 for women and 300-500 taka shoes for children. Their best sold sports shoe are ranging from 700 -900 taka. They open their store every day from 9.00-10.00 in the evening. After 2 months they bring out at least some kind of new design in one of their s egments. Most effective sales campaign up to 20% discount. Their market presence in the country is over 25 years but not doing that well. Market share is only 50% mainly the quality of the shoe is moderate. ? Homeland: It is the least known brand among buyers. No non-shoe items. Open
every day 9.00-10.00PM in the evening. On average bring out new design after 2-3 months. Discount up to 20% on specific design are their most effective sales campaign. It is a Bangladeshi company. Not too many people know them but they are in market for more than 10 years. Their main lacking is their poor distribution channel. Only 15-20 stores in the country is the indication of it.
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Independent High: It is most popular among buyers. They are the type of seller
who usually sold relatively high priced imported shoes. Men's best-sold price ranges are 1400-1750 taka, women's 600-750 taka, and no school shoes but have children's shoes 320-400 taka. They remain open every day from 10.30-10.00PM at night. They don't provide any kind of sales campaign, as all of them are bargain stores. They are named as the elephant road shoe market. They have good market share more than 15% and holds a preference in the general people's mind. Though sometimes they bring some new designs but that is slow and the quality of the shoe is also moderate. ? Independent Medium: These types are stores are of plenty in the elephant road
area. They're usual best ranges for men‘s shoe are 500-600 taka, 200-400 taka for women, and 100-250 taka shoe for children. They have no school shoes and non-shoe items. Dominating colour and sizes that are the same as Independent highs. Their opening hours are same as high's. Implementation new design happens after 3-4 months. They hold a major market shares. The bargain price of them attracts people. The quality of their shoe is not up to the standard in many cases. Low establishment cost, no promotion cost makes them sell shoe at a very low cost. STRATEGIES OF BATA Bata is one of the world's leading footwear retailers and manufacturers with operations across 5 continents managed by 3 regional meaningful business units. The meaningful business units approach provides quality resources and support in key areas to the companies operating in similar markets such as product development, sourcing or marketing support. Each meaningful business units is entrepreneurial in nature, and can quickly adapt to changes in the market place and seize potential growth opportunities. Bata's strength lies in its worldwide presence. While local companies are selfgoverning, each one benefits from its link to the international organization for back-office systems, product innovations and sourcing. In Africa: In many forums discussing the continent of Africa, we can hear the sensible claim that Africa is still a continent where a number of adult people die well before they have ever won their first pair of new or any shoes and yet for the large
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number of African children who attend primary school, the one name that is synonymous with and most recognizable brand is Bata. There's no doubt that this is one of the most ubiquitous companies in the main cities of the African continent. Ian Austen reports on the passing on of Thomas Bata, the founder's son who was the Chief Executive has passed on. The story states that the corporation that makes nearly 300 million pairs of shoes annually was indeed run by this "shoemaker for the world". As most firms find out in Africa, the continent is a difficult terrain for business but Thomas Bata's statement declaring that the expansion into Africa was motivated by the desired to sell shoes is clearer than many states. All I am certain of is that he found reasonable returns for his efforts selling shoes to a continent with an uncomfortably large number of the worlds unshod. Bata is the largest shoe company in India in terms of sales and revenues. It commands around 35 percent of market share in India. Company‘s 98 percent revenue comes from domestic operation. It owns about 1250 stores spread across India. The company which demonstrated the highest degree of early commitment to the Indian market was obviously Bata, The shoe major invested in a fairly elaborate distribution network with company owned retail shops in even small towns. Bata also took the bold step of targeting the mass markets instead of just milking the premium segments. It targeted middle class Indians with value-for-money products. Indeed, many Indians do not know that Bata is an MNC. In targeting up-market segments, however, Bata began to deviate from this strategy in the late 1980s. We can also see that the positioning of the brand was very well done in minds of all the segments of the country. The segmentation, target customers were very well focused. The sale of Bata was increasing and it was doing well. But the problem with Bata was that it did not redesign its product. It went on with the similar product range. Taking the advantage of this many competitors entered the market and wiped off a larger market share of Bata. And the market share of Bata had come down from 50 percent to 10 percent.
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Then Bata realized to change its strategy and aligned towards addressing a larger pie, introducing newer product lines and new brands. Bata was also focusing on 'quality sales' with stress on consumer satisfaction as it found that quantity sales could increase the turnover, but quantity without quality would only destabilize the consumer confidence that had taken ages to build. If analysed for the value that Bata was providing to its customers their value proposition may be categorized as follows. ? ? ? Reasonable quality at low or reasonable price. Footwear for the entire family. Footwear catering to various functional needs e.g. sports, casual footwear, formal-
semi formal. ? ? Conveniently accessible outlets in various parts of the country. Prior to entry of local players and the Chinese imports, some sort of social
visibility could also be associated with Bata, as it was one of the two major brands in the country then. Bata has a sizeable brand advantage and a presence across price points, but faces competition from imports and the unorganized sector. Competitive Advantage above the other brands Manufacturing: Bata is dwelling on its international presence which is its competitive edge and importing its best practices from abroad to be able to handle the manufacturing requirements for slightly trendier lines with lesser volumes. It is also utilizing its regional expertise e.g. in Malaysia for rubber based shoes and in China for artificial leather shoes. Customer: The customer value proposition is substantial as Bata offers value for money along with the trust which its customers have because of the established Bata brand. In terms of access, functionality and selection options it always fulfils its promises of being a family outlet where each member of the family can buy something. The service
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standards is strictly monitored and hence an experience fit will be provided to the customers and these customers for this will be willing to pay a bit of premium because of Bata‘s brand and hence the competition undercutting Bata on price would no longer be that big a threat. Internal Process: As far as the internal aspects of the firm are concerned Bata is restoring its operations management processes, customer management processes, innovation processes and regulatory and social processes. Modifications in
the Operations management processes will allow Bata to have low cost to an extent, through economies of scale attained through specialist regions worldwide supplying the products, as import duties would no longer be a barrier, and other stable high volume products being manufactured locally at the Bata plants. Learning and Growth: In order to attain its goals as per the new strategies Bata is consistently putting in quite a lot of effort into training its human resource, especially those at the outlets to provide consistent quality service to its customers so that customers can associate the same experience with which ever outlet they visit of Bata. A culture of empowerment is fostered and younger energetic managers are being appointed given the responsibilities so that they may fill in any leadership void, if created. However overall longer leadership stints for top executives e.g. CEOs would be needed to allow them to take the company towards its goals by implementing the strategy. With these changes in place, Bata would be in a better position to cope with the various challenges posed to it, by its competitors. Distribution Strategy followed by Bata Bata India MD Marcelo Villagran says, "In today's challenging market, our strategy of opening large format stores has been successful and we would continue to invest in expanding our retail business. Along with this, we have also focused upon providing our customers with a new trendy collection and better shoe designs. Our value pricing, coupled with improved customer service, has helped us to grow." Bata has its retail footprints in major metro and other big cities, revamping key stores, more store space in superior retail outlets and closing unviable stores. At present there are
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1200 stores in 400 cities in India, all are company owned and reaching out rural markets through dealer network. The company has a three-pronged strategy; setting up 60 large-format stores every year (minimum area of 3,000 sq ft), closing down the unviable ones and increasing its focus on institutional business. Focus on Product Strategy Creating contemporary look for the product which can be found in almost every retail store and in every occasion, introducing new offerings for men, ladies, sports personnel and children. Initiation of regular customer feedback process, customer research, training of staff, multi pronged sourcing strategy to reach faster, procure faster and more economically, Consolidation of manufacturing operations, restructuring of wholesale division into four independent distribution channels: urban and institutional, safety, branding segment for more impact and better sales. The stores operate in a four-tier retail format under a new model -- upmarket flagship stores, smart and trendy city stores, super stores and traditional family stores. This helps the company service its customers better in places where currently it does not have presence."The large-format stores are mostly franchise-run. The new-design store interiors itself cost the company around Rs 2 core per store," Bata chairman P M Sinha says. These new stores have helped Bata to bring its contemporary and trendy range of footwear sold in an international style outlet to customers even in small towns. The company is also depending on institutional business heavily. "We will have shoes tailor made for hospitals, military forces, factory workers, and airlines. We will also introduce a new range of sports shoes in India this year which will be comparable to the best sportswear brands available.
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ANALYSIS - II
STRATEGIES USED BY BATA SHOE COMPANY Market-Scope Strategy Choices: 1) Single-Market Strategy 2) Multi-Market Strategy 3) Total-Market Strategy Among the three choices Bata has chosen and uses 'Total-Market Strategy's they serve all classes of people with their shoes ranging from 30/- to 2195/-. The specifics of the strategy is provided belowDefinition: Serving the overall market with one or some other kind of offerings. Objectives: To diversify the risk of serving only one market. Requirements: ? ? Carefully selecting all the segments and providing offerings to all. Avoid confrontation with companies serving the entire market.
Expected Results: ? ? Higher Sales Higher Market Share
Market-Geography Strategy Choices: 1) Local Market Strategy 2) Regional Market Strategy 3) National Market Strategy 4) International Market Strategy
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Among the Market-Geography Strategies Bata Bangladesh follows the 'NationalMarket Strategy' in Bangladesh as they distribute their product to the whole of Bangladesh using their own and Danish's distribution channel. Though it is a MNC it operates quite freely here in Bangladesh and operates as National-Market Strategy. Definition: Operating Nationally Objective: To seek growth Requirements: ? ? ? Top management commitment Capital Resources Willingness to take risks
Expected Results: ? ? ? Increased growth Increased market share Keep up with competitors
Market-Entry Strategy Choices: 1) First-In Strategy 2) Early-Entry Strategy 3) Laggard-Entry Strategy Among the Market-Entry choices, Bata Bangladesh uses 'First-in Strategy' which is characterized by the following: Definition: Entering market during the introduction stage. Two modes of entry are feasible: ? ? Conventional marketing strategy Initiator-Entering market with unconventional marketing strategies.
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Objectives: To understand the market first and reap the profit at the beginning and waiting for the competitors and strike them with good lowering price and improved quality. At the same time it offers variety of products. Requirements: ? ? Market research ability Production capability
Expected Results: ? ? ? Putting market on a new growth path. Increased profits. Some growth opportunities.
Market-Dilution Strategy Choices: 1) De-marketing Strategy 2) Pruning-of Marginal Market Strategy 3) Key Markets Strategy 4) Harvesting Strategy Among the market-dilution strategies, Bata Bangladesh uses kind of harvesting strategy in many cases. They also come up with the key markets strategy. Definition: Focusing on overall market and take out the invested profit. Objectives: To serve the market well where they are now. Requirements: ? ? ? Gain continuous knowledge of the local markets. Concentrate all energies on these markets. Develop unique strategies to serve the chosen markets.
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Expected Results: ? ? Increased profits. Increased market share in the selected markets.
Product Strategy choices: 1. Product Positioning Strategy 2. Product Repositioning Strategy 3. Product-Overlap Strategy 4. Product-Scope Strategy 5. Product-Design Strategy 6. Product-Elimination Strategy 7. New-Product Strategy 8. Diversification Strategy Among the product strategies Bata Bangladesh has used ?Product Positioning Strategy’ and ‘Diversification Strategy’ which is characterized by the following: Product Positioning Strategy: Definition: Placing a brand in that part of the market where it will have a favorable reception compared with competing brands. Objectives: ? ? Position product in market so that it stands apart from competing brands. To position the product so that it tells customers what you stand for, what you are, how you would like customers to evaluate you. In the case of positioning multiple brands: ? ? To seek growth by offering varied products in differing segments of the market. To avoid competitive threats to a single brand.
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Requirements: ? ? Use of marketing mix variables (design and communication efforts). Successful management of a single brand requires positioning the brand in the market so that it can stand competition from the toughest rivals and maintaining its unique position by creating the aura of a distinctive product. ? Successful management of multiple brands requires careful positioning in the market so that multiple brands do not compete with nor cannibalize each other. Thus it is important to be careful in segmenting the market and to position and individual product as uniquely suited to a particular segment through designand promotion. Expected Results: ? Meet as much as possible the needs of specific segments of the market. ? Limit sudden change in sales. ? Make customers faithful to the brands. Distribution Strategy Definition: Developing unfamiliar products and markets through ? Concentric diversification (products introduced are related to existing ones in term of marketing or technology), ? Horizontal diversification (new products are unrelated to existing ones but are sold to the same customers), and ? Conglomerate diversification (products are entirely new.) Objectives: Diversification Strategies response to the desire for: ? Growth when current products/markets have reached maturity, ? Stability by spreading the risks of fluctuations in earnings, ? Security when the company may fear backward integration from its major customers, and ? Credibility to have more weight in capital markets.
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Requirements: In order to reduce the risk inherent in a diversification strategy, a business unit should? ? ? ? Diversify activities only if current product/market opportunities are limited, Have good knowledge of the area in which it diversifies, Provide the products introduced with adequate support, and Forecast the effects of diversification on existing lines of products.
Expected Results: ? ? Increase in sales. Greater profitability and flexibility.
Pricing Strategy Choices: 1. For new products: ? ? Skimming Pricing Penetration Pricing
At times Bata Shoe Company in Bangladesh used ?Penetration Strategy‘ which is characterized by the following: Definition: Setting a relatively low price during the initial stages of products life. Objectives: To discourage competition from entering market by quickly taking large market share and by ganging cost advantage by realizing economies of scale. Requirements: ? ? Products must appeal to a market large enough to support the cost advantages. Demand must be highly elastic in order for firm to guard its cost advantage.
Expected Results: ? ? ? High sales volume and large market share. Low margin of sales. Lower unit costs relative to competition due to economies of scale.
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2. For Established products choices: ? ? ? Maintaining the price Reducing the price Increasing the price
When the products of Bata Bangladesh were established in the market they used ?Maintaining the price Strategy’ which is characterized by the following: Objectives: ? ? To maintain position in the market place(i.e. market share, profitability, etc.). To enhance public image.
Requirements: ? ? ? Firms served market is not significantly affected by changes in the environment. Uncertainty exists concerning the need for our result of price change. Firm‘s public image could be enhanced by responding to government requests or public opinion to maintain price. Expected Results: ? ? Status quo for the firm‘s market position, Enhancement of the firm‘s public image.
Price Flexibility Strategy Choices: 1. One-Price Strategy 2. Flexibility-pricing Strategy 3. Bundle-Pricing Strategy 4. Price-Leadership Strategy 5. Pricing Strategy to build market share Among the price-flexible strategies, Bata Bangladesh uses the ‘One-Price Strategy’ and the ‘Pricing Strategy to build market Share’ which are characterized by the following:
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One-Price Strategy: Definition: Charging the same price to all customers under similar conditions and for the same quantities. Objectives: ? ? To simplify pricing decisions. To maintain goodwill among customers.
Requirements: ? ? ? Detailed analysis of the firm‘s position and cost structure as compared with the rest of the industry. Information concerning cost variability of offering same price to everyone. Knowledge of the economics of scale available to the firm.
Expected Results: ? ? ? ? Decreased administrative and selling costs. Constant profit margins. Favorable and fair image among customers. Stable market.
Pricing Strategy to build market Share Definition: Setting the lowest price possible for a new product. Objectives: To seek such a cost advantage that it cannot ever be profitably overcome by any competitor. Requirements: ? ? ? Enough resources to withstand initial operating losses that will be recovered later through economies of scale. Price-sensitive market. Large market.
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?
High elasticity of demand.
Expected Results: ? ? ? Start-up losses to build market share. Creation of a barrier to entry to the industry. Ultimately cost leadership within the industry.
Promotional Strategy Choices: 1) Promotion-Expenditure Strategy 2) Promotion Mix Strategy 3) Media Selection Strategy 4) Advertising Copy Strategy 5) Selling Strategy 6) Sales Motivation and Supervision Strategy Of all the promotional strategies Bata Bangladesh as we observed followed the selling. At least their lack of advertising in the electronic and print media and their target of coming up with new stores reflect that. They try to be at the doorstep of people with their store rather than intense advertising. But they give some ads to the newspaper on their new arrivals sometimes. Distribution Strategy Choices: 1. Direct 2. Indirect Bata shoe company Bangladesh Ltd. uses both direct (i.e. they deliver directly) and indirect (i.e. through a distributor) distribution strategies. The distribution channel of Bata has already described earlier.
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SWOT ANALYSIS OF BATA STRENGTH OF BATA COMPANY Manager may want to evaluate his strength by area, such as marketing, finance, manufacturing, and organizational structure. Strength include the positive attributes of the people involved in the business, including their knowledge, backgrounds, education, credentials, contacts, reputation, or the skills they bring. Strength also include tangible assets such as available capital, equipment, credit, established customers, existing channels of distribution, copyrighted materials, patents, information and processing system, and other valuable resources within the business. Strengths capture the positive aspects internal to his business that add value or offer him a competitive advantage. This is his opportunity to remind himself of the value exiting within his business. ? Intention of Sale Environment: Bata Shoe Company has an intention of creating
a profitable sale environment in them. ? Service Motive: Bata Shoe Company has the motive of better service giving to
the customer. ? Flexibility: Bata Shoe Company is a flexible departmental store. It can perform its
business activities both in much or less space. ? Market Research: The authority does a research over the market position, ups
and downs of prices, needs and wants of the customer to take important marketing decision. ? Supply of goods according to new fashion: It serves the products to the
consumer according to the new style and fashion. I think if they want to increase their strength higher they also follow these rules: ? ? Image of the company Quality Product
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? ? ?
Differentiated line of products Competitive Pricing Strong distribution channel
WEAKNESS OF BATA COMPANY Weaknesses are factors that are within manager‘s control that detract from his ability to obtain or maintain a competitive edge. Weaknesses might include lack of expertise, limited resources, lack of access to skills or technology, inferior service offerings, or the poor location of his business. These are factors that are under his control, but for a variety of reasons, are in need of improvement to effectively accomplish his marketing objectives. Weaknesses capture the negative aspects internal to his business that detract from the value he offers, or place at a competitive disadvantage. These are areas he needs to enhance in order to complete with his best competitor. The more accurately he identifies his weaknesses, the more valuable the SWOT will be for his assessment. Bata Shoe Company has also some weakness. They are? Delay in decision making: The authority has to take decision by consulting with
other members. Sometime long term discussion and arguing make the decision time consuming. ? Lack of Advertising: Advertisement provided by Bata Shoe Company is not
sufficient. The net information does not meet to our need. If they want to improve themselves I think they must overcome the weakness and the weaknesses are from my point of view: ? ? Sufficient promotional activities Bata at present conducts all the store management activity manually. This results lots of lengthy paper works, errors and waste of time. So they can conduct it by machines or other equipments.
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? ? ?
Ability to catch the present trend in time. High competitive price due to high cost structure. VAT & tax barrier.
OPPORTUNITIES OF BATA COMPANY Opportunity Bata India Limited has undertaken initiatives to improve the company‘s cost structure and margins. The company has initiated a financial restructuring exercise to down its interest cost. Financial Re-engineering. The company has tightened controls on costs in all areas of and is looking at global sourcing for raw materials and other inputs. Bata India is also exploring third party manufacturing units in Assam and Jammu & Kashmir as these enjoy tax holidays. Bata Shoe Organization (BSO) has decided to give a breather to its 51 percent subsidiary. ? Goodwill: Bata Shoe Company has created goodwill among the consumer by
providing better service. ? ? Direct Communication: It maintains a direct communication with the consumer. Creating Relationship: Bata Shoe Company creates direct relationship with
consumer. ? Market Expansion: Market expansion opportunity in high fashion & value for
money footwear market for all categories of shoe through Retail & WCSM channels. ? Despite political turbulence: Despite political turbulence a segment of our
middle-class is coming up with reasonable buying power. Many of them are women who are decision maker so the city store concept of Bata can attract them as whole of the family footwear can be available there.
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THREATS OF BATA COMPANY Threat introduction of new brands in the market. Lagging behind in terms of technological factors. Young generation is attracted to the other branded shoes like Addidas, Nike, woodland etc. ? Competitors: Powerful multiple stores like Apex, Ajfal are competitors of Bata
Shoe Company. ? Political Instability: Political instability affects the supply of raw materials and
distribution of finished products. ? Smuggling of shoes: Smuggling of shoes and many stores in the city like the
one's in elephant road are the major market leaders. As they don't have to pay for large amount of money for establishment, production, quality and advertising so they can sell at a much lower price than established brands like Bata.
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RECOMMENDATIONS
I would like to make recommendations to Bata Shoe Organization for their better improvement. ? Company should focus more on Product and Market Development and Market
penetration Strategies. ? More attention should be given to the middle and upper middle class of the
society, because increasing number of people belonging to these segments and also because of their rising incomes. ? Renewed brand image will help Bata to attract upper middle end of the market
and will raise the higher income. ? As footwear industry is highly fashionable industry; Bata must concentrate on
bringing new designs and styles. ? The service standards should be strictly monitored and hence an experience fit
will be provided to the customers and these customers for this will be willing to pay a bit of premium because of Bata‘s brand and hence the competition undercutting Bata on price would no longer be that big a threat. ? It will need to focus on marketing itself as an outlet meeting all basic needs of the
families in its target market segment ? Should provide consistent quality service to its customers so that customers can
associate the same experience with whichever outlet they visit of Bata. ? Internet is a broad medium so they should also improve e-business.
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CONCLUSION
Bata is known as the most respected and popular brand in leather shoes because of its quality, from pre partition days. It is an international renowned brand and caters to the requirements of every country where it is present with respect to its specific cultural requirements, weather conditions and consumers mindset. Bata's sole mission is to provide shoes for everyone, for every occasion and for every profession. Bata offers great value and utmost convenience with an immense variety and styles. It is the only brand in the market which offers products after extensive research and trials. Therefore, users consider Bata shoes distinctively ahead in establishing fashion trends by constantly offering new varieties in men's shoes, women's shoes, kid‘s shoes, school shoes and slippers. The name of Bata is synonymous with quality and trends. Although several new brands have emerged in the market but Bata remains as a brand of a class of its own. Bata is continuously engaged in analyzing trends and develops new models and varieties while maintaining the quality of its products. Because of the environmental condition, people require rugged and high quality products and Bata simply meets their requirements of every market segment. Accordingly the attribute of Familiarity is strongly following the attribute of Quality and indicates well brainstorming on advertising themes for its marketing.
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BIBLIOGRAPHY
www.bata.in www.bata.com www.tomasbata.com www.scribd.com www.shareternpapers.com www.slideshare.net www.managementparadise.com www.business.outlookindia.com www.thehindubusinessline.com www.telegraphicindia.com www.economictimes.indiatimes.com www.wikipedia.com www.bataindustrial.com http://essaysforstudent.com/essay/Factors-affecting-Customers-PreferenceBata/96506.html http://www.scribd.com/doc/44689918/Report-BATA-Shoe-Co
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doc_227252466.docx
strategic mangement
INTRODUCTION
The BATA shoe organization is one of the world's largest manufacturers and retailers of footwear. The company rapidly expanded after its foundation in 1894 and by 1930's its operated in Switzerland, Germany, England, France, Yugoslavia, Poland, India and Holland. This expansion continued and by 1960, Bata employed over 42,000 employees, owned thousand of company stores and many factories across the world including almost every continent. It has a retail presence in over 50 countries and production facilities in 26 countries. The company has sold more than 14 billion pairs of shoe till now. Every day about 1 million customers are being served throughout its 4,600 retail stores worldwide. The company was founded in 1894 in Zin by Tomas Bata whose family had been cobblers for generations. A large order from the army, military shoe and rising demand for them, during World War I started rapid growth and small manufacture turned into modern industrial concern, one of the first mass producers of shoe. ? TOMAS BATA: Tomas Bata was recognized for his social conscience,
establishing housing, cinemas and advancement programs for his employees. He saw technology as a mean of progress, and wanted to make the shoe as cheaply as possible so that the greatest number of people could access them. He employed 16,560 people, maintain 1645 shops, and 25 enterprises. The total international contribution to the Bata organization at the time of Tomas' death consisted of 20 international enterprises, 132 shops, and 790 employees. ? JAN ANTONIN BATA: After Tomas Bata's plane crash his half-brother Jan
Antonin Bata becomes head of the company; at this time company continues the diversification into the production of tires, aircraft, bicycles, machineries. Under Jan Antonin Bata the company grew quickly, continued its expansion throughout Europe, North America, Asia and North Africa.
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BATA IN INDIA The company was incorporated in the year 1931 as Bata Shoe Company Pvt. Ltd. in Konngar, West Bengal, which was then shifted to Batanagar. Batanagar was the first manufacturing facility in the Indian shoe industry to receive the ISO 9001 certificate. The Company went public in 1973. They changed their name to Bata India Ltd. Over the years Bata India has established a leadership position in the footwear industry and is easily the most trusted name in branded footwear. The company has entered into an agreement with Bata Ltd of Toronto, Canada for supply of technical know- how and services such as footwear technology and design, brand development, product development, retailing and information systems for a period of ten years from January 1, 2001. The company bagged the Retailer of the year award for the year 2006 in the footwear category as a part of the Reid and Taylor Award for Retail Excellence which was presented during the Indian Retail Summit 2006. Bata was honoured with Most Admired Brand of the year 2006-07 in Footwear category. They have been rated as one of the Top 10 super brands in India and awarded Super Brands Award on April 12 2007.Bata has entered into the retail segment and is currently has 1250 stores all over India. For a shoe manufacturing company, brand image depends on various variables like variety of product, availability, price, convenience of location, durability etc. This research is aimed to reveal these variables and their level of influence on the brand image of Bata. The Indian footwear giant Bata is overhauling its retail strategy by getting back into the fast track by devising three strategies. These strategies are to set up 60 large format stores, closing its non profiting stores and by increasing its sales to institutional businesses. Also Bata has recently opened 32 retail stores in a minimum area of 3,000 sq. ft each, defying the trend in the retail industry of putting expansion plans on hold. The stores operate in a four-tier retail format under a new model -- up market flagship stores, smart and trendy city stores and super stores and traditional family stores. These largeformat stores are mostly franchise-run and have helped Bata to bring its contemporary and trendy range of footwear sold in an international style outlet to customers even in
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small towns. The idea behind the adoption of these strategies is swift expansion and up gradation. Bata is also following its second strategy by reducing the number of its unviable stores from 140 to 74 and is ready to shut down more such stores in future. Along with this, the company has also focused upon providing the customers with a novel trendy collection and better shoe designs. The company is also depending on institutional business by starting tailor-made shoes for hospitals, military forces, factory workers and airlines. Bata has already set up a dedicated team headed by a retired Defense man to secure contracts as Defense authorities currently source most of its footwear requirement from unorganized players. The country has 45 million workforce in various manufacturing and mining sector and the company sees this as a good business opportunity. Parent group Bata Worldwide would be providing technology sourced from the Safety and Industrial Centre at Holland. Bata is the largest shoe company in India in terms of sales and revenues. It commands around 35 percent of market share in India. Company‘s 98 percent revenue comes from domestic operation. It owns about 1250 stores spread across India. The company which demonstrated the highest degree of early commitment to the Indian market was obviously Bata, The shoe major invested in a fairly elaborate distribution network with company owned retail shops in even small towns. Bata also took the bold step of targeting the mass markets instead of just milking the premium segments. It targeted middle class Indians with value-for-money products. Indeed, many Indians do not know that Bata is an MNC. In targeting up-market segments, however, Bata began to deviate from this strategy in the late 1980s. Then Bata realized to change its strategy and aligned towards addressing a larger pie, introducing newer product lines and new brands. Bata was also focusing on 'quality sales' with stress on consumer satisfaction as it found that quantity sales could increase the turnover, but quantity without quality would only destabilize the consumer confidence that had taken ages to build.
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MISSION AND VISION OF BATA Bata Shoe Company has been successfully running for years with a mission and vision at the heart of all its operations. MISSION ?Introduction of a strong shoe line targeted to various market segments to maintain leadership through increased market share.? VISSION ?To provide good quality shoes at an affordable price by keeping in mind the comfort that needs to be there and providing new designs with it.? INITIAL POSITIONING AND SUBSEQUENT REPOSITIONING Bata has positioned itself as a one stop family store for all footwear and related products. It has traditionally positioned itself as providing product lines catering to the middle class segment of the society; it has also tried targeting the high class customers. Bata had become a need brand .In terms of the needs, Bata was in a way successful in positioning itself as a brand having stores with products to meet the needs of almost all members of the family, since it had product ranges for children, men, women etc. Till the 1980s, Bata enjoyed an almost monopolistic position in the organized footwear market. It‘s simple, yet iconic, brown leather sandals and blue-and-white rubber slippers were instantly recognizable and also are still recognized. Bata was the choice for everyone in the family. Whether it was shoes for the monsoon, school shoes, formal wear or even comfort wear for the elderly, the brand had something for every member in the Indian household. There was a period in the past in India when anyone mentioned shoes or chappals, there would be a single name Bata. It was one of the most popular names after Tata. The brand Bata was household name then. It ruled market as leader till recent years when various national and international brands came up. The Bata shoe lovers were so addicted with Bata for them thinking shoes other than Bata was an unpatriotic act. People wore Bata proudly.
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It has also come out with new set of brands like hush puppies, Marie Claire brand offering the latest patent, metallic and ethnic styles in footwear. The recently introduced ladies hand bags have also met with a very good response from the youth. Sandak, Batalite and Sunshine labels has continued to allure millions of customers with trendy and lightweight all-weather footwear as these footwear are very light . Bata was considered as manufacturing oriented company who concentrate on producing footwear and sell them in market at anyhow. Bata wanted to change this image of production oriented company to affordable, market driven, fashion conscious, lifestyle brand that is why Bata wanted to reposition itself. Bata is trying to move out of this image of an age old seller of their manufactured goods. They are now concentrating on "product that the customer wants rather than products that they produce." Bata India in a complete process to change from its earlier image. Bata was considered as manufacturing oriented company who concentrated on producing footwear and sell them in market at anyhow. It wanted to change its image from a manufacturing company to a marketing company. Bata wanted to change this image of production oriented company to affordable, market driven, fashion conscious, lifestyle brand. They are focusing on a better brand recall by opening bigger stores in malls etc. It has revamped its stores to look more contemporary, shedding its age old image. The company has decided to be more visible in shopping malls, open up to the franchisee model and also create the shop-in-shop experience in a multi-branded store. A step towards rejuvenating the Bata brand, the company is repositioning itself as a market driven, fashion conscious lifestyle brand with an emphasis on service and production. The company recently introduced international styles and trends for women, men and kids, which have gone a long way in providing a trendy and contemporary image to the company. Revamping its marketing operations, Bata India has introduced the concepts Flagship, City, Family and Bazaar stores that cater to different segments of the market. Further, to capture the retail boom prevailing in the country, the company has decided to move its headquarters to Gurgaon this year. They are also intending to make the shopping
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experience better to their customers by employing skilled salesperson & creating a better ambience. Few Examples are: Hush puppies
This unique invention would not only change the kind of shoes we wear, it would also herald the beginning of today's relaxed style. ? ? Bounce technology for shock absorption and energy return in every step. 100% relax Hush Puppies collection of innovative, authentic casual footwear, mixed textures of soft casual leathers and rich Hush Puppies worry-free suede. North Star: North Star is with street creed. Stylish, trendy comfortable and durable, the range is ideally suited to the urban environment. The youth market is attracted to the brands retro styles, including designs from the late 80s as well as contemporary interpretations, making it a highly sought after brand name. It's a casual yet fashionable street-style shoes that caters to the young at heart. Marie Claire: Marie Claire, a fashion lifestyle brand of shoes with a touch of elegance that caters to the young cosmopolitan women. Bata Brands is the trademark owner of Marie Claire for shoes worldwide. Marie Claire stands for Contemporary and modern styling, adaptive to an active lifestyle yet elegant and feminine. Subtle fashion trend details and quality products with a clean finish, it is a brand that brings out every woman's confidence & individual style.
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ANALYSIS - I
MARKETING RESEARCH ON BATA Marketing research is "the process or set of processes that links the consumers, customers, and end users to the marketer through information — information used to identify and define marketing opportunities and problems; generate, refine, and evaluate marketing actions; monitor marketing performance; and improve understanding of marketing as a process. Marketing research specifies the information required to address these issues, designs the method for collecting information, manages and implements the data collection process, analyzes the results, and communicates the findings and their implications It is the systematic gathering, recording, and analysis of qualitative and quantitative data about issues relating to marketing products and services. The goal of marketing research is to identify and assess how changing elements of the marketing mix impacts customer behavior. The term is commonly interchanged with market research; however, expert practitioners may wish to draw a distinction, in that market research is concerned specifically with markets, while marketing research is concerned specifically about marketing processes. Marketing research is often partitioned into two sets of categorical pairs, either by target market: ? ? Consumer marketing research, and Business-to-business marketing research
Or, alternatively, by methodological approach:
? ?
Qualitative marketing research, and Quantitative marketing research
Consumer marketing research is a form of applied sociology that concentrates on understanding the preferences, attitudes, and behaviors of consumers in a market-based
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economy, and it aims to understand the effects and comparative success of marketing campaigns. The field of consumer marketing research as a statistical science was pioneered by Arthur Nielsen with the founding of the ACNielsen Company in 1923. Thus, marketing research may also be described as the systematic and objective identification, collection, analysis, and dissemination of information for the purpose of assisting management in decision making related to the identification and solution of problems and opportunities in marketing. IMPORTANCE OF MARKETING RESEARCH FOR BATA ? To make marketing decisions
:Marketing research helps the marketers to make a decision about the product or service. Sometimes a marketer might believe that the new product or service is useful for the customers. Good marketing research strives to provide options for the successful introduction of new products and services. This makes the market entry of a new product less risky. ? Survive the competition
Marketing research helps in ascertaining and understanding competitor information such as their identity, marketing network, customer focus and scale of operations. With market research one can understand the under-served consumer segments and consumer needs that have not been met. ? Help to decide target markets
Research helps in providing customers information in terms of their location, age, buying behavior etc. this helps the marketers zero in on the target markets and customers for their products. ? Maximize profits
Apart from profit maximizing steps such as item optimization, customer profitability analysis and price elasticity, marketing research allows one to find out method that can help to maximize the profits. ? Increasing the sales
Increasing the sale helps a company in maximizing its profits. By understanding the
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Customers needs, wants and attitude towards the products and determining whether the product fit the bill, market can increase their sales. ? Consumer perception
It is an important aspect for any industry. Perception is the process by which people select, organize and interpret information to form a meaningful picture of the world. Every day people are exposed to a great amount of stimuli .not all stimuli attracts customers. People also forget whatever they have come across. Bata Use of social networking to overcome inter-generation effects Consumers have forgotten that Bata is a foreign brand due to the long history of the brand in India and its proliferation across the length and breadth of the country. Bata should build a favorable image by the source of internet to combine multiple messages targeted at multiple stakeholders through two-way communication which will increase the involvement levels. Social networking websites and blogs on sport websites , promotion on online gaming ,advertisements on sports news aggregator websites etc. will enhance the image of the brand and create a favorable attitude towards the ad and brand leading to purchase decision. People‘s perception of something can vary greatly from person to person, with each one forming an individual opinion about the stimuli being received. Perception is one of the key psychological factors that influence consumer behavior. The role of perception in consumer behavior is all about recognizing how consumers view a company‘s product. A consumer for buying a particular product often comes down to image. People wish to be perceived as having the ability to make the right? choice sand pick the right products. Marketers use perception to target peoples need to fit in and be a part of a larger group of consumers. Reasons why Bata shares are rising This reports talks about reasons for rising Bata‘s shares. Reasons being: ? ? Shares of footwear maker Bata India traded nearly 7% higher at Rs. 775 on the Bombay Stock Exchange. According to the budget Proposal, Excise Duty exemption on non-leather footwear has been enhanced from Rs. 250 to Rs.500 per pair. Non –leather
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footwear above Rs. 500 per pair will now attract excise duty of 12% from 10% earlier. ? 30% of Bata‘s sales are from canvas and plastic, hence subject to an exemption from the duty. ? Bata pays about 1.5% of sales as Excise duty.
Other factors being culture, family, peers, status, occupation, economic situation, lifestyle etc. ? To investigate about the perception of the consumers
For every company, it is very important to know how the customers perceive its brand. Bata have been perceived as a brand focusing on middle and upper middle class. Consumer perception is not constant it keeps on changing. ? To analyze competitor‘s strategy in the market (Liberty, Relaxo) For every company it is important to keep an eye on what the competitors are up to. It‘s a Competitive world every company tries to bring its product in such a manner that it gets quickly accepted by the audience. Bata till now has been able to secure its position from the rest. ? To know the most effective media or source for the advertisement : Bata has lacking in its promotion. in order to survive in today‘s competitive world and keeping a pace with them it is important for Bata to come up with brand new advertisement be it newspaper or television. E- Marketing is equally important. ? To know the market potential of Gurgaon
:Bata is a well-known brand in India. But it is important to know how the people of Gurgaon perceive it. Is Gurgaon contributing to the market share of Bata as a whole? ? To know future expectations of the buyers
:It is important to know what customers expect out a brand. Do customers prefer Bata for casual footwear or formal footwear? Either they want more variety for both the segments or changes in the existing segment. ? To determine the importance of various attributes of the buyers regarding the choice of their footwear
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:It is crucial for the company to know what attribute of Bata attracts consumers. Attributes are quality, durability, price, etc. ? To determine the annual expenditure affordable by majority of the people or customers on their footwear .
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GLOBAL MARKETING STRATEGIES OF BATA Today Global Marketing is one of the most exciting fields of business. Global Marketing refers to marketing activities coordinated and integrated across multiple country markets. The integration can involve: ? ? ? ? ? ? standardized products, uniform packaging, identical brand names, synchronized product introductions, similar advertising messages, and Coordinated sales campaigns across markets in several countries.
Now a day, there are several global organizations operating in our country following global marketing strategy and tactics. One of such organization is BATA Shoes. Bata Shoes is a large, family owned shoe company. Bata is one of the world's leading footwear retailers and manufacturers with operations across 5 continents managed by 3 regional meaningful business units. The meaningful business units approach provides quality resources and support in key areas to the companies operating in similar markets such as product development, sourcing or marketing support. Each meaningful business unit is entrepreneurial in nature, and can quickly adapt to changes in the market place and seize potential growth opportunities.
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GLOBAL COMPETITORS FOR BATA
Bata has a 13.7 percent market share. It also has to face tough competition from many organized and unorganized sectors. Bata has overcome all the competitors and well sustained with a good market share .it has to watch the other manufacturers and make a counter move to match the competitors move. Leading competitors are Lakhani Shoes, Apex, Liberty Shoes, Action Shoes, Reebok, Woodland, Paragon and Relaxo in organized sector. Unorganized Sector: It has to face a major competition from Chinese footwear market which is imported from china .because Chinese footwear entered Indian market , Bata has to change its policy and also had to face major financial loss. Which also led to fall of Bata‘s market share to 10%.which was a major setback for Bata India. Ba ta then stopped concentrating on lower segment (in which Chinese had an edge: low price) which led Bata to concentrate on other segments like on premium brands also. Bata faces the most competition from the ladies footwear division and that too from the local unorganized shoe manufacturers and Chinese shoe makers.
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ANALYSIS OF COMPETITORS ? Apex: Most of their shoes are expensive. They don't provide any school shoes.
The sports shoe they bring into the market are mostly imported "Addidas" shoes and quite expensive. In the men's section the most dominating colour is black, in women section black and chocolate. They provide sophisticated colour shoe for children. The most dominating sizes of the men, women and children are the average sizes that are sold in any Bata store. They remain open on everyday of the week except any government holiday. Opening hour is 9.00AM-10.00PM. They generally implemented new design after every 6 months according their employees. The most successful sales campaigns are 60% off on specific design. Their market share is about 1.50% in Bangladesh. ? Liberty: Here in this shoe stores the average price of the shoes are also
expensive. Their average retail price is 600+. They also have the same kind of offerings in their respective divisions. Usually the normal colour and size that are sold elsewhere also sold here. They remain open every day except of any government holidays. They open at 10 in the morning and remain open up to 10 in the evening. After 3-6 months they brought new design shoes in the market. The most effective sales campaign is 4060% discount on specific design shoes. The market share of Liberty shoe is about 1%. They are in the market for about 13 years as a franchisee they are from India. ? Reebok: They only sale sports shoes and some children shoes who are
in their teens. The price of all shoes is high 1200+. The colour and design of their shoes are of high quality. Reebok brings different types T -shirts, tracksuits and non-shoes items, which are quite expensive. A fter every 1-2 months new design of shoe comes in their store. 20 -25% discounts on specific design are their most effective sales campaign. About 10% market share Reebok is quickly gaining ground and getting attention of the brand conscious segment of the country. ? Nike: Same as Reebok, Nike only offers high quality sports and some
children shoes. Their shoes are also expensive sports shoes ranging from 2000-5000, which are sold most. Best-sold non-shoe items such as T-shirt,
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tracksuits are ranging from 750-2250 taka. They open their store everyday of the week. They brought new design in the market after every 3 months. They don't have any sales campaign up to now. Same as Reebok but their market share is less than their international rival as they have enter Bangladesh market for 6 or 7 years. ? Woodland: Trendy high quality shoes for all. They don't provide
school shoes. Dust, Brown and Green are their dominating color in every category. They have lots of non-shoes item like T-shirt, trousers, and shoe polish. The most popular price ranges among those are 695 -1395 taka. They open every day from 10.00-9.00. It brings new design in after 3 -4 months. The effective sales campaign is same as Reebok. Very good quality trendy shoes which quickly gaining ground in the country. This is the same company that brings Reebok in the country as franchisee. ? Pegasus: They made their name as sports shoe manufacturer. After that
they come up shoes for both the male and the women. Their best -sold price range is 800-1200 for men, 550-750 for women and 300-500 taka shoes for children. Their best sold sports shoe are ranging from 700 -900 taka. They open their store every day from 9.00-10.00 in the evening. After 2 months they bring out at least some kind of new design in one of their s egments. Most effective sales campaign up to 20% discount. Their market presence in the country is over 25 years but not doing that well. Market share is only 50% mainly the quality of the shoe is moderate. ? Homeland: It is the least known brand among buyers. No non-shoe items. Open
every day 9.00-10.00PM in the evening. On average bring out new design after 2-3 months. Discount up to 20% on specific design are their most effective sales campaign. It is a Bangladeshi company. Not too many people know them but they are in market for more than 10 years. Their main lacking is their poor distribution channel. Only 15-20 stores in the country is the indication of it.
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?
Independent High: It is most popular among buyers. They are the type of seller
who usually sold relatively high priced imported shoes. Men's best-sold price ranges are 1400-1750 taka, women's 600-750 taka, and no school shoes but have children's shoes 320-400 taka. They remain open every day from 10.30-10.00PM at night. They don't provide any kind of sales campaign, as all of them are bargain stores. They are named as the elephant road shoe market. They have good market share more than 15% and holds a preference in the general people's mind. Though sometimes they bring some new designs but that is slow and the quality of the shoe is also moderate. ? Independent Medium: These types are stores are of plenty in the elephant road
area. They're usual best ranges for men‘s shoe are 500-600 taka, 200-400 taka for women, and 100-250 taka shoe for children. They have no school shoes and non-shoe items. Dominating colour and sizes that are the same as Independent highs. Their opening hours are same as high's. Implementation new design happens after 3-4 months. They hold a major market shares. The bargain price of them attracts people. The quality of their shoe is not up to the standard in many cases. Low establishment cost, no promotion cost makes them sell shoe at a very low cost. STRATEGIES OF BATA Bata is one of the world's leading footwear retailers and manufacturers with operations across 5 continents managed by 3 regional meaningful business units. The meaningful business units approach provides quality resources and support in key areas to the companies operating in similar markets such as product development, sourcing or marketing support. Each meaningful business units is entrepreneurial in nature, and can quickly adapt to changes in the market place and seize potential growth opportunities. Bata's strength lies in its worldwide presence. While local companies are selfgoverning, each one benefits from its link to the international organization for back-office systems, product innovations and sourcing. In Africa: In many forums discussing the continent of Africa, we can hear the sensible claim that Africa is still a continent where a number of adult people die well before they have ever won their first pair of new or any shoes and yet for the large
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number of African children who attend primary school, the one name that is synonymous with and most recognizable brand is Bata. There's no doubt that this is one of the most ubiquitous companies in the main cities of the African continent. Ian Austen reports on the passing on of Thomas Bata, the founder's son who was the Chief Executive has passed on. The story states that the corporation that makes nearly 300 million pairs of shoes annually was indeed run by this "shoemaker for the world". As most firms find out in Africa, the continent is a difficult terrain for business but Thomas Bata's statement declaring that the expansion into Africa was motivated by the desired to sell shoes is clearer than many states. All I am certain of is that he found reasonable returns for his efforts selling shoes to a continent with an uncomfortably large number of the worlds unshod. Bata is the largest shoe company in India in terms of sales and revenues. It commands around 35 percent of market share in India. Company‘s 98 percent revenue comes from domestic operation. It owns about 1250 stores spread across India. The company which demonstrated the highest degree of early commitment to the Indian market was obviously Bata, The shoe major invested in a fairly elaborate distribution network with company owned retail shops in even small towns. Bata also took the bold step of targeting the mass markets instead of just milking the premium segments. It targeted middle class Indians with value-for-money products. Indeed, many Indians do not know that Bata is an MNC. In targeting up-market segments, however, Bata began to deviate from this strategy in the late 1980s. We can also see that the positioning of the brand was very well done in minds of all the segments of the country. The segmentation, target customers were very well focused. The sale of Bata was increasing and it was doing well. But the problem with Bata was that it did not redesign its product. It went on with the similar product range. Taking the advantage of this many competitors entered the market and wiped off a larger market share of Bata. And the market share of Bata had come down from 50 percent to 10 percent.
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Then Bata realized to change its strategy and aligned towards addressing a larger pie, introducing newer product lines and new brands. Bata was also focusing on 'quality sales' with stress on consumer satisfaction as it found that quantity sales could increase the turnover, but quantity without quality would only destabilize the consumer confidence that had taken ages to build. If analysed for the value that Bata was providing to its customers their value proposition may be categorized as follows. ? ? ? Reasonable quality at low or reasonable price. Footwear for the entire family. Footwear catering to various functional needs e.g. sports, casual footwear, formal-
semi formal. ? ? Conveniently accessible outlets in various parts of the country. Prior to entry of local players and the Chinese imports, some sort of social
visibility could also be associated with Bata, as it was one of the two major brands in the country then. Bata has a sizeable brand advantage and a presence across price points, but faces competition from imports and the unorganized sector. Competitive Advantage above the other brands Manufacturing: Bata is dwelling on its international presence which is its competitive edge and importing its best practices from abroad to be able to handle the manufacturing requirements for slightly trendier lines with lesser volumes. It is also utilizing its regional expertise e.g. in Malaysia for rubber based shoes and in China for artificial leather shoes. Customer: The customer value proposition is substantial as Bata offers value for money along with the trust which its customers have because of the established Bata brand. In terms of access, functionality and selection options it always fulfils its promises of being a family outlet where each member of the family can buy something. The service
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standards is strictly monitored and hence an experience fit will be provided to the customers and these customers for this will be willing to pay a bit of premium because of Bata‘s brand and hence the competition undercutting Bata on price would no longer be that big a threat. Internal Process: As far as the internal aspects of the firm are concerned Bata is restoring its operations management processes, customer management processes, innovation processes and regulatory and social processes. Modifications in
the Operations management processes will allow Bata to have low cost to an extent, through economies of scale attained through specialist regions worldwide supplying the products, as import duties would no longer be a barrier, and other stable high volume products being manufactured locally at the Bata plants. Learning and Growth: In order to attain its goals as per the new strategies Bata is consistently putting in quite a lot of effort into training its human resource, especially those at the outlets to provide consistent quality service to its customers so that customers can associate the same experience with which ever outlet they visit of Bata. A culture of empowerment is fostered and younger energetic managers are being appointed given the responsibilities so that they may fill in any leadership void, if created. However overall longer leadership stints for top executives e.g. CEOs would be needed to allow them to take the company towards its goals by implementing the strategy. With these changes in place, Bata would be in a better position to cope with the various challenges posed to it, by its competitors. Distribution Strategy followed by Bata Bata India MD Marcelo Villagran says, "In today's challenging market, our strategy of opening large format stores has been successful and we would continue to invest in expanding our retail business. Along with this, we have also focused upon providing our customers with a new trendy collection and better shoe designs. Our value pricing, coupled with improved customer service, has helped us to grow." Bata has its retail footprints in major metro and other big cities, revamping key stores, more store space in superior retail outlets and closing unviable stores. At present there are
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1200 stores in 400 cities in India, all are company owned and reaching out rural markets through dealer network. The company has a three-pronged strategy; setting up 60 large-format stores every year (minimum area of 3,000 sq ft), closing down the unviable ones and increasing its focus on institutional business. Focus on Product Strategy Creating contemporary look for the product which can be found in almost every retail store and in every occasion, introducing new offerings for men, ladies, sports personnel and children. Initiation of regular customer feedback process, customer research, training of staff, multi pronged sourcing strategy to reach faster, procure faster and more economically, Consolidation of manufacturing operations, restructuring of wholesale division into four independent distribution channels: urban and institutional, safety, branding segment for more impact and better sales. The stores operate in a four-tier retail format under a new model -- upmarket flagship stores, smart and trendy city stores, super stores and traditional family stores. This helps the company service its customers better in places where currently it does not have presence."The large-format stores are mostly franchise-run. The new-design store interiors itself cost the company around Rs 2 core per store," Bata chairman P M Sinha says. These new stores have helped Bata to bring its contemporary and trendy range of footwear sold in an international style outlet to customers even in small towns. The company is also depending on institutional business heavily. "We will have shoes tailor made for hospitals, military forces, factory workers, and airlines. We will also introduce a new range of sports shoes in India this year which will be comparable to the best sportswear brands available.
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ANALYSIS - II
STRATEGIES USED BY BATA SHOE COMPANY Market-Scope Strategy Choices: 1) Single-Market Strategy 2) Multi-Market Strategy 3) Total-Market Strategy Among the three choices Bata has chosen and uses 'Total-Market Strategy's they serve all classes of people with their shoes ranging from 30/- to 2195/-. The specifics of the strategy is provided belowDefinition: Serving the overall market with one or some other kind of offerings. Objectives: To diversify the risk of serving only one market. Requirements: ? ? Carefully selecting all the segments and providing offerings to all. Avoid confrontation with companies serving the entire market.
Expected Results: ? ? Higher Sales Higher Market Share
Market-Geography Strategy Choices: 1) Local Market Strategy 2) Regional Market Strategy 3) National Market Strategy 4) International Market Strategy
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Among the Market-Geography Strategies Bata Bangladesh follows the 'NationalMarket Strategy' in Bangladesh as they distribute their product to the whole of Bangladesh using their own and Danish's distribution channel. Though it is a MNC it operates quite freely here in Bangladesh and operates as National-Market Strategy. Definition: Operating Nationally Objective: To seek growth Requirements: ? ? ? Top management commitment Capital Resources Willingness to take risks
Expected Results: ? ? ? Increased growth Increased market share Keep up with competitors
Market-Entry Strategy Choices: 1) First-In Strategy 2) Early-Entry Strategy 3) Laggard-Entry Strategy Among the Market-Entry choices, Bata Bangladesh uses 'First-in Strategy' which is characterized by the following: Definition: Entering market during the introduction stage. Two modes of entry are feasible: ? ? Conventional marketing strategy Initiator-Entering market with unconventional marketing strategies.
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Objectives: To understand the market first and reap the profit at the beginning and waiting for the competitors and strike them with good lowering price and improved quality. At the same time it offers variety of products. Requirements: ? ? Market research ability Production capability
Expected Results: ? ? ? Putting market on a new growth path. Increased profits. Some growth opportunities.
Market-Dilution Strategy Choices: 1) De-marketing Strategy 2) Pruning-of Marginal Market Strategy 3) Key Markets Strategy 4) Harvesting Strategy Among the market-dilution strategies, Bata Bangladesh uses kind of harvesting strategy in many cases. They also come up with the key markets strategy. Definition: Focusing on overall market and take out the invested profit. Objectives: To serve the market well where they are now. Requirements: ? ? ? Gain continuous knowledge of the local markets. Concentrate all energies on these markets. Develop unique strategies to serve the chosen markets.
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Expected Results: ? ? Increased profits. Increased market share in the selected markets.
Product Strategy choices: 1. Product Positioning Strategy 2. Product Repositioning Strategy 3. Product-Overlap Strategy 4. Product-Scope Strategy 5. Product-Design Strategy 6. Product-Elimination Strategy 7. New-Product Strategy 8. Diversification Strategy Among the product strategies Bata Bangladesh has used ?Product Positioning Strategy’ and ‘Diversification Strategy’ which is characterized by the following: Product Positioning Strategy: Definition: Placing a brand in that part of the market where it will have a favorable reception compared with competing brands. Objectives: ? ? Position product in market so that it stands apart from competing brands. To position the product so that it tells customers what you stand for, what you are, how you would like customers to evaluate you. In the case of positioning multiple brands: ? ? To seek growth by offering varied products in differing segments of the market. To avoid competitive threats to a single brand.
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Requirements: ? ? Use of marketing mix variables (design and communication efforts). Successful management of a single brand requires positioning the brand in the market so that it can stand competition from the toughest rivals and maintaining its unique position by creating the aura of a distinctive product. ? Successful management of multiple brands requires careful positioning in the market so that multiple brands do not compete with nor cannibalize each other. Thus it is important to be careful in segmenting the market and to position and individual product as uniquely suited to a particular segment through designand promotion. Expected Results: ? Meet as much as possible the needs of specific segments of the market. ? Limit sudden change in sales. ? Make customers faithful to the brands. Distribution Strategy Definition: Developing unfamiliar products and markets through ? Concentric diversification (products introduced are related to existing ones in term of marketing or technology), ? Horizontal diversification (new products are unrelated to existing ones but are sold to the same customers), and ? Conglomerate diversification (products are entirely new.) Objectives: Diversification Strategies response to the desire for: ? Growth when current products/markets have reached maturity, ? Stability by spreading the risks of fluctuations in earnings, ? Security when the company may fear backward integration from its major customers, and ? Credibility to have more weight in capital markets.
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Requirements: In order to reduce the risk inherent in a diversification strategy, a business unit should? ? ? ? Diversify activities only if current product/market opportunities are limited, Have good knowledge of the area in which it diversifies, Provide the products introduced with adequate support, and Forecast the effects of diversification on existing lines of products.
Expected Results: ? ? Increase in sales. Greater profitability and flexibility.
Pricing Strategy Choices: 1. For new products: ? ? Skimming Pricing Penetration Pricing
At times Bata Shoe Company in Bangladesh used ?Penetration Strategy‘ which is characterized by the following: Definition: Setting a relatively low price during the initial stages of products life. Objectives: To discourage competition from entering market by quickly taking large market share and by ganging cost advantage by realizing economies of scale. Requirements: ? ? Products must appeal to a market large enough to support the cost advantages. Demand must be highly elastic in order for firm to guard its cost advantage.
Expected Results: ? ? ? High sales volume and large market share. Low margin of sales. Lower unit costs relative to competition due to economies of scale.
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2. For Established products choices: ? ? ? Maintaining the price Reducing the price Increasing the price
When the products of Bata Bangladesh were established in the market they used ?Maintaining the price Strategy’ which is characterized by the following: Objectives: ? ? To maintain position in the market place(i.e. market share, profitability, etc.). To enhance public image.
Requirements: ? ? ? Firms served market is not significantly affected by changes in the environment. Uncertainty exists concerning the need for our result of price change. Firm‘s public image could be enhanced by responding to government requests or public opinion to maintain price. Expected Results: ? ? Status quo for the firm‘s market position, Enhancement of the firm‘s public image.
Price Flexibility Strategy Choices: 1. One-Price Strategy 2. Flexibility-pricing Strategy 3. Bundle-Pricing Strategy 4. Price-Leadership Strategy 5. Pricing Strategy to build market share Among the price-flexible strategies, Bata Bangladesh uses the ‘One-Price Strategy’ and the ‘Pricing Strategy to build market Share’ which are characterized by the following:
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One-Price Strategy: Definition: Charging the same price to all customers under similar conditions and for the same quantities. Objectives: ? ? To simplify pricing decisions. To maintain goodwill among customers.
Requirements: ? ? ? Detailed analysis of the firm‘s position and cost structure as compared with the rest of the industry. Information concerning cost variability of offering same price to everyone. Knowledge of the economics of scale available to the firm.
Expected Results: ? ? ? ? Decreased administrative and selling costs. Constant profit margins. Favorable and fair image among customers. Stable market.
Pricing Strategy to build market Share Definition: Setting the lowest price possible for a new product. Objectives: To seek such a cost advantage that it cannot ever be profitably overcome by any competitor. Requirements: ? ? ? Enough resources to withstand initial operating losses that will be recovered later through economies of scale. Price-sensitive market. Large market.
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?
High elasticity of demand.
Expected Results: ? ? ? Start-up losses to build market share. Creation of a barrier to entry to the industry. Ultimately cost leadership within the industry.
Promotional Strategy Choices: 1) Promotion-Expenditure Strategy 2) Promotion Mix Strategy 3) Media Selection Strategy 4) Advertising Copy Strategy 5) Selling Strategy 6) Sales Motivation and Supervision Strategy Of all the promotional strategies Bata Bangladesh as we observed followed the selling. At least their lack of advertising in the electronic and print media and their target of coming up with new stores reflect that. They try to be at the doorstep of people with their store rather than intense advertising. But they give some ads to the newspaper on their new arrivals sometimes. Distribution Strategy Choices: 1. Direct 2. Indirect Bata shoe company Bangladesh Ltd. uses both direct (i.e. they deliver directly) and indirect (i.e. through a distributor) distribution strategies. The distribution channel of Bata has already described earlier.
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SWOT ANALYSIS OF BATA STRENGTH OF BATA COMPANY Manager may want to evaluate his strength by area, such as marketing, finance, manufacturing, and organizational structure. Strength include the positive attributes of the people involved in the business, including their knowledge, backgrounds, education, credentials, contacts, reputation, or the skills they bring. Strength also include tangible assets such as available capital, equipment, credit, established customers, existing channels of distribution, copyrighted materials, patents, information and processing system, and other valuable resources within the business. Strengths capture the positive aspects internal to his business that add value or offer him a competitive advantage. This is his opportunity to remind himself of the value exiting within his business. ? Intention of Sale Environment: Bata Shoe Company has an intention of creating
a profitable sale environment in them. ? Service Motive: Bata Shoe Company has the motive of better service giving to
the customer. ? Flexibility: Bata Shoe Company is a flexible departmental store. It can perform its
business activities both in much or less space. ? Market Research: The authority does a research over the market position, ups
and downs of prices, needs and wants of the customer to take important marketing decision. ? Supply of goods according to new fashion: It serves the products to the
consumer according to the new style and fashion. I think if they want to increase their strength higher they also follow these rules: ? ? Image of the company Quality Product
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? ? ?
Differentiated line of products Competitive Pricing Strong distribution channel
WEAKNESS OF BATA COMPANY Weaknesses are factors that are within manager‘s control that detract from his ability to obtain or maintain a competitive edge. Weaknesses might include lack of expertise, limited resources, lack of access to skills or technology, inferior service offerings, or the poor location of his business. These are factors that are under his control, but for a variety of reasons, are in need of improvement to effectively accomplish his marketing objectives. Weaknesses capture the negative aspects internal to his business that detract from the value he offers, or place at a competitive disadvantage. These are areas he needs to enhance in order to complete with his best competitor. The more accurately he identifies his weaknesses, the more valuable the SWOT will be for his assessment. Bata Shoe Company has also some weakness. They are? Delay in decision making: The authority has to take decision by consulting with
other members. Sometime long term discussion and arguing make the decision time consuming. ? Lack of Advertising: Advertisement provided by Bata Shoe Company is not
sufficient. The net information does not meet to our need. If they want to improve themselves I think they must overcome the weakness and the weaknesses are from my point of view: ? ? Sufficient promotional activities Bata at present conducts all the store management activity manually. This results lots of lengthy paper works, errors and waste of time. So they can conduct it by machines or other equipments.
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? ? ?
Ability to catch the present trend in time. High competitive price due to high cost structure. VAT & tax barrier.
OPPORTUNITIES OF BATA COMPANY Opportunity Bata India Limited has undertaken initiatives to improve the company‘s cost structure and margins. The company has initiated a financial restructuring exercise to down its interest cost. Financial Re-engineering. The company has tightened controls on costs in all areas of and is looking at global sourcing for raw materials and other inputs. Bata India is also exploring third party manufacturing units in Assam and Jammu & Kashmir as these enjoy tax holidays. Bata Shoe Organization (BSO) has decided to give a breather to its 51 percent subsidiary. ? Goodwill: Bata Shoe Company has created goodwill among the consumer by
providing better service. ? ? Direct Communication: It maintains a direct communication with the consumer. Creating Relationship: Bata Shoe Company creates direct relationship with
consumer. ? Market Expansion: Market expansion opportunity in high fashion & value for
money footwear market for all categories of shoe through Retail & WCSM channels. ? Despite political turbulence: Despite political turbulence a segment of our
middle-class is coming up with reasonable buying power. Many of them are women who are decision maker so the city store concept of Bata can attract them as whole of the family footwear can be available there.
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THREATS OF BATA COMPANY Threat introduction of new brands in the market. Lagging behind in terms of technological factors. Young generation is attracted to the other branded shoes like Addidas, Nike, woodland etc. ? Competitors: Powerful multiple stores like Apex, Ajfal are competitors of Bata
Shoe Company. ? Political Instability: Political instability affects the supply of raw materials and
distribution of finished products. ? Smuggling of shoes: Smuggling of shoes and many stores in the city like the
one's in elephant road are the major market leaders. As they don't have to pay for large amount of money for establishment, production, quality and advertising so they can sell at a much lower price than established brands like Bata.
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RECOMMENDATIONS
I would like to make recommendations to Bata Shoe Organization for their better improvement. ? Company should focus more on Product and Market Development and Market
penetration Strategies. ? More attention should be given to the middle and upper middle class of the
society, because increasing number of people belonging to these segments and also because of their rising incomes. ? Renewed brand image will help Bata to attract upper middle end of the market
and will raise the higher income. ? As footwear industry is highly fashionable industry; Bata must concentrate on
bringing new designs and styles. ? The service standards should be strictly monitored and hence an experience fit
will be provided to the customers and these customers for this will be willing to pay a bit of premium because of Bata‘s brand and hence the competition undercutting Bata on price would no longer be that big a threat. ? It will need to focus on marketing itself as an outlet meeting all basic needs of the
families in its target market segment ? Should provide consistent quality service to its customers so that customers can
associate the same experience with whichever outlet they visit of Bata. ? Internet is a broad medium so they should also improve e-business.
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CONCLUSION
Bata is known as the most respected and popular brand in leather shoes because of its quality, from pre partition days. It is an international renowned brand and caters to the requirements of every country where it is present with respect to its specific cultural requirements, weather conditions and consumers mindset. Bata's sole mission is to provide shoes for everyone, for every occasion and for every profession. Bata offers great value and utmost convenience with an immense variety and styles. It is the only brand in the market which offers products after extensive research and trials. Therefore, users consider Bata shoes distinctively ahead in establishing fashion trends by constantly offering new varieties in men's shoes, women's shoes, kid‘s shoes, school shoes and slippers. The name of Bata is synonymous with quality and trends. Although several new brands have emerged in the market but Bata remains as a brand of a class of its own. Bata is continuously engaged in analyzing trends and develops new models and varieties while maintaining the quality of its products. Because of the environmental condition, people require rugged and high quality products and Bata simply meets their requirements of every market segment. Accordingly the attribute of Familiarity is strongly following the attribute of Quality and indicates well brainstorming on advertising themes for its marketing.
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BIBLIOGRAPHY
www.bata.in www.bata.com www.tomasbata.com www.scribd.com www.shareternpapers.com www.slideshare.net www.managementparadise.com www.business.outlookindia.com www.thehindubusinessline.com www.telegraphicindia.com www.economictimes.indiatimes.com www.wikipedia.com www.bataindustrial.com http://essaysforstudent.com/essay/Factors-affecting-Customers-PreferenceBata/96506.html http://www.scribd.com/doc/44689918/Report-BATA-Shoe-Co
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doc_227252466.docx