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Marketing Plan for Fabindia, Ahmedabad
 

Marketing Plan for Fabindia, Ahmedabad

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Its a marketing Plan for Fabindia, Ahmedabad

Its a marketing Plan for Fabindia, Ahmedabad

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Marketing Plan for Fabindia, Ahmedabad Marketing Plan for Fabindia, Ahmedabad Presentation Transcript

  • PGP Project PresentationMarketing Planfor FABINDIA, Ahmedabad
    Presented By:
    NIKITA SANGHVI
  • FLOW OF PRESENTATION
    Introduction
    Current Marketing Situation
    Threats and Opportunities Analysis
    Objectives and Issues
    Marketing Strategy
    Action Program
    Recommendations
    Batch 2009-2911
    Stevens Business School
    Marketing Plan
  • INTRODUCTION
    FABRIC OF INDIA
    India's largest private platform for products that are made from traditional techniques, skills and hand-based processes
    Initially commenced as a village based industry in 1960 by John Bissell
    Links over 40,000 craft based rural producers to modern urban markets
    Promotes inclusive capitalism, through its unique COC (community owned companies) model
    Marketing Plan
    Batch 2009-2911
    Stevens Business School
  • INTRODUCTION
    Fabindia Products
    Batch 2009-2911
    Stevens Business School
    Marketing Plan
    TEXTILE BASED
    • ready-to-wear garments
    • accessories for men, women,
    teenagers and children;
    • bed, bath, table and kitchen linen;
    • floor coverings, upholstery fabric and curtains.
    • Cotton, silk, wool, grass, linen and
    jute are the basic fibres used
    NON- TEXTILE BASED
    • Home Products (October 2000)
    furniture,
    lighting,
    stationery, tableware,
    cane baskets
    selection of handcrafted utility items
    NON- TEXTILE BASED
    Organic Food Products (July 2004)
    cereals,
    grains,
    pulses,
    spices,
    sugar,
    tea,
    coffee,
    honey,
    fruit preserves
    herbs
    NON- TEXTILE BASED
    Authentic Personal care products (March 2006)
    soaps,
    shampoos,
    hair oils,
    pure oils,
    moisturizers,
    body scrubs,
    face packs,
    hair conditioners
    special skin care products
  • INTRODUCTION
    Awards for Fab India
    • Awarded “Best Retail Brand, 2004” by The Economic Times of India.
    • Got “Designer Promoting Indian Craft or Technique award” as Hall of Fame reward.
    Annual Report(2008-09)
    Annual turnover of the company is in the range of Rs 500 crore
    Profit ranges between Rs 35- 40 crore.
    Registered a CAGR of about 58% in the period 2006-2008
    Batch 2009-2911
    Stevens Business School
    Marketing Plan
  • INTRODUCTION
    FabindiaStore locations
    108 stores in 40 major cities of India.
    6 stores in international places including UAE, Dubai, Bahrain, Italy and Rome.
    Online Shopping & Exports to 34 countries
    Batch 2009-2911
    Stevens Business School
    Marketing Plan
  • Fab India: timeline
    Early 80’s
    1990’s
    1999
    2001
    2004
    2006
    2010
    1960
    7
    Batch 2009-2911
    Stevens Business School
    Vision:200 stores and a turnover of Rs.1000 crore by 2011
  • CURRENT MARKETING SITUATION
    • A delighted Customer is our Best Brand Ambassador”
    • USP : quality of the fabric and the cultivated image of ‘Indianness’
    • Does not follow any customer acquisition strategy: focuses on customer retention
    • Key element: word of mouth publicity ( Zero advertising except print ads during promotions ), advertorials, mobile marketing, in-store posters
    • Mystery Shopper Program: to check the customer satisfaction level
    • Motivating factor for the customer: quality and consistency of product and the service
    • Over 83% of Fabindia’ s customers go back satisfied, with 58% being highly satisfied with the brand and its offerings
    SOURCE: Interview of Mr. William Bissel, MD, Fabindia published in The Economic Times, Jun 2009
    8
    Batch 2009-2911
    Stevens Business School
  • CURRENT MARKETING SITUATION
    Batch 2009-2911
    Stevens Business School
    Marketing Plan
    FabIndia Store Format
    • It has designed the stores’ decor and ambience keeping this in mind
    • The layout usually keeps clothes section at the back of the store and the entrance area is utilized for home products.
    • The exclusive jewellery counter is also kept in the fronts.
    • Metros
    • Posh locality
    • All product lines
    • Tier II cities
    • Specific products retailing
  • COMPETITION
    • Garments Based (Shoppers Stop, Pantaloons, Westside, Reliance Trends, Globus)
    • Government Handloom Initiatives (KhadiGramodyog, Cottage Industries Emporium, State Government departments)
    • Designer Boutiques
    Ethnic wear retailers like Khadder, W and Good Things, and Stand alone stores like Shristi, Biba, Anokhi
    • Local tailors who provide customised garments to the customers at reasonable prices
    • Local NGOs selling wares,
    • Regional -Law Garden Market for buying handicraft and Gujarati outfits
    10
    Batch 2009-2911
    Stevens Business School
  • STRENGTHS
    Quintessential Indianness in fabric through the years
    Popular for authenticity of hand-woven fabric
    Sourcing system from rural India
    Strong supplier relationship
    Provision of capital loans (in agreement with banks)
    Leniency on order fulfilment & no-return policy
    100% use of supplier’s capacity
    Sustainable employment opportunities to rural skilled poor
    Employees are given autonomy and hence inducing accountability
    Focus on customer retention instead of generation
    Large chunk of buyers are repeat purchasers
    Product quality improvement done keeping this in mind
    • Word-of-mouth strong enough not to require any advertising
  • WEAKNESSES
    Delays in delivery from artisans
    Opportunity losses due to irregularity
    Difficult to predict quantity and time of thaancoming from weaver
    Also arises as different stores are encouraged to order different stock
    Insignificant spend on marketing communications
    Losing out on attracting new customers instead of depending only on repeat purchase
    Not enough personnel to push Fabindia to greater growth
    Unavailability of people experienced in retail sector
    Unavailability of people believing in the same mission
    More formal processes would face resistance from existing employees
    Untimely delivery of products
    Transport, storage and shelf-life issues of organic foods
    Suppliers were spread pan-India
  • OPPORTUNITIES
    Latent potential of organic foods market
    Leveraging changing consumer tastes & perceptions
    Awareness generation of merit in these foods
    Utilize multi-brand retail outlets and construction groups
    Display of Fabindia products in MBOs and department stores
    Leverages footfalls of the store, increasing likelihood of sales
    Use of Fabindia home furnishings in modular flats of buildings
    If consumer buys this flat or any other, and is impressed, will use Fabindia furnishings
    Leveraging Web 2.0 tools and techniques
    Tying up with matrimonial sites for designer fancy wedding wear
    Interactive website for designing as per individual requirements
    Customization level is high
    Lead time between fixing of occasion date and event can be used for delivery
  • THREATS
    Unorganized local operators
    Handloom retail shops/chains in regional pockets
    Souvenir shops providing indigenous products at lower prices
    Entry of organized brands and companies into retail
    High expected growth & entry of business houses in large ways
    Competitors access funds from conglomerate partners or markets
    Tilt of Indian consumers towards foreign brands
    Foreign brands alter lifestyle choices of the target market
    “Imported” or designer home furnishings have greater ‘flaunt value’ vis-a-visFabindia
    Development of government co-operatives
    Boost in future to KVIC and state handloom units
    Improvement in their ambience and shopping experience
    Rising prices of real estate could hamper growth
    Opening new stand-alone stores will be tough
    Experimenting with formats and markets may not be advisable
  • MARKET SURVEY
    Objective: To explore:
    The affective responses Fabindia’s consumers
    Cognitive responses of Fabindia’s consumers
    Purchasing behavior of the consumers for products of apparel category
    Sampling Design
    Sampling Unit : Customers of Fabindia
    Sampling techniques : Convenience Sampling
    Sample size : Customers -30
    Batch 2009-2911
    Stevens Business School
    Marketing Plan
  • MARKET SURVEY
    16
    Batch 2009-2911
    Stevens Business School
  • MARKET SURVEY
    17
    Batch 2009-2911
    Stevens Business School
  • MARKET SURVEY
    18
    Batch 2009-2911
    Stevens Business School
    Which of the following do you think was the instrumental in your choosing to buy the garments? Rank them on the scale of 1 to 5 with 1 being the most important.
  • MARKET SURVEY
    19
    Batch 2009-2911
    Stevens Business School
    Rate your experience at Fabindia in terms of your satisfaction level for the following: (Highly Satisfactory, Satisfactory, Average, Unsatisfactory, Highly Unsatisfactory)
  • SUMMARY OF MARKET SURVEY
    Batch 2009-2911
    Stevens Business School
    Marketing Plan
  • 21
    Batch 2009-2911
    Stevens Business School
  • 22
    Batch 2009-2911
    Stevens Business School
  • Batch 2009-2911
    Stevens Business School
    Marketing Plan
  • FABINDIA: 2011
    Early 80’s
    24
    Batch 2009-2911
    Stevens Business School
  • FINANCIAL COMPARISONS
    Financial aspects of Fabindia have been compared with Pantaloons
    Though not a direct competitor, it represents the Indian Retail Industry very well
    Financials for its direct competitors such as Anokhi, Khadi Gram Udhyog etc. were not available, restricting comparison
    This assessment contrasts the performance of Fabindia with respect to the biggest retailer of India
    Hence, we get a sense of the feasible options available with Fabindia to raise funds
  • INTEREST COVERAGE RATIO
    Batch 2009-2911
    Stevens Business School
    Marketing Plan
    The interest coverage ratio of Fabindia is far higher than that of Pantaloons. Hence, raising funds through debt is not a big challenge.
  • INTEREST COST AS % OF SALES
    Batch 2009-2911
    Stevens Business School
    Marketing Plan
    The interest cost as a percentage of sales for Fabindia is far lesser than that of Pantaloons. Hence, raising funds through debt is again not a big challenge.
  • PROFIT MARGIN RATIO (IN %)
    Batch 2009-2911
    Stevens Business School
    Marketing Plan
    The PAT as a percentage of sales of Fabindia is higher than that of Pantaloons. Though retail industry works at low margins, Fabindia’s margins are quite high. Hence, raising funds through debt is not a big challenge.
  • OPTIONS AVAILABLE
    DEBT FINANCING
    Pros
    The decision authority stay with them, hence can stick to their mission
    Healthy current ratio (around 2:1 throughout years)
    A very healthy interest coverage ratio (as high as 16 times) which is quite higher compared to Pantaloons, Shoppers Stop etc. (1.5%-2.5%)
    A very healthy debt to equity ratio
    Interest cost as a percentage of Sales is very low (0.006%)
    Family owned
    Cons
    Debt acquired may not be huge
    Loose out on the expertise of other organisations which can be brought in through JVs or investments
  • OPTIONS AVAILABLE
    PRIVATE INVESTORS/ JVs
    Pros
    Huge investments can be brought in
    Professional expertise can be brought in
    Cons
    Decision authority gets diluted
    Emphasis may shift to profit maximisation and hence Fabindia’s mission may get diluted
  • CULTURAL EVENT(ON GROUND ACTIVATION)
    • The FabIndia Website gives information about the various fabric crafts like Chikankari, Kalamkari, Batik etc. for the customers.
    • We will bring this art on ground for them to experience it first hand and also learn it.
    • Every metro will have a 2 day workshop cum exhibition where these artists will put up stalls about these crafts and exhibit the work along with “Live Craft Workshop”, workshops (for more knowledge and interest) for keen audience.
    • It will be called “Know what you wear”
    • This makes the customers more aware of the work put in for their fabric and helps them with their association with brand FabIndia.
    • It will also have a regional food festival at the same time to make it an overall fun and enriching experience.
    31
    Batch 2009-2911
    Stevens Business School
  • “WOMEN OF TODAY”
    • As an extended activity, on weekends FabIndia will have “weekend promotions” with special focus on “Women of Today”.
    • Men can be encouraged to increasingly visit the stores with the women in their lives with offers like “ bring your mom/sis/wife/ girlfriend to shop, and get x% off”
    • FabIndia will tie up with various NGOs like Breakthrough, Jagori etc. for their cause of empowering women.
    • Viral video to be launched in association with Breakthrough ( along the lines of Mann keManjeere)
    Objective-
    The passion group identifies with the theme ““Women of Today” and results in new customer acquisition
    32
    Batch 2009-2911
    Stevens Business School
  • RECOMMENDATIONS AT A GLANCE
    Heavy investments in back-end of value chain
    Supply chain development for efficiency and quality management
    Expansion aiding strong regional presence
    Outlets to counter regional competition
    Sourcing from local suppliers for outlet and other regions will be easier
    Growth through harnessing new customers
    Cannot depend on existing customers to counter competition
    Must create new customers in all segments
    Tie up with different types of graduate schools for talent
    Rural management graduates for managing supply chain and rural initiatives
    Management graduates for helping growth in front-end and retail arms
  • THANK YOU
    Batch 2009-2911
    Stevens Business School
    Marketing Plan