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PGP Project PresentationMarketing Planfor FABINDIA, Ahmedabad<br />Presented By:<br />NIKITA SANGHVI<br />
FLOW OF PRESENTATION<br />Introduction<br />Current Marketing Situation<br />Threats and Opportunities Analysis<br />Objec...
INTRODUCTION<br />FABRIC OF INDIA<br />India's largest private platform for products that are made from traditional techni...
INTRODUCTION<br />Fabindia Products<br />Batch 2009-2911<br />Stevens Business School<br />Marketing Plan<br />TEXTILE BAS...
accessories for men, women, </li></ul>teenagers and children; <br /><ul><li>bed, bath, table and kitchen linen;
floor coverings, upholstery fabric and curtains.
Cotton, silk, wool, grass, linen and </li></ul>jute are the basic fibres used<br />NON- TEXTILE BASED<br /><ul><li>Home Pr...
INTRODUCTION<br />Awards for Fab India<br />• Awarded “Best Retail Brand, 2004” by The Economic Times of India.<br />• Got...
INTRODUCTION<br />FabindiaStore locations<br />108 stores in 40 major cities of India. <br /> 6 stores in international pl...
Fab India: timeline<br />Early 80’s <br />1990’s<br />1999<br />2001<br />2004<br />2006<br />2010<br />1960<br />7<br />B...
CURRENT MARKETING SITUATION<br /><ul><li>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 marketi...
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</li>...
CURRENT MARKETING SITUATION<br />Batch 2009-2911<br />Stevens Business School<br />Marketing Plan<br />FabIndia Store Form...
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</li></li></ul><li>COMPETITION<br /><ul><li>Garments Based (Shoppers Stop, Pantaloons, Westside...
Government Handloom Initiatives (KhadiGramodyog, Cottage Industries Emporium, State Government departments)
Designer Boutiques</li></ul>Ethnic wear retailers like Khadder, W and Good Things,  and Stand alone stores like Shristi, B...
Local NGOs selling wares,
Regional -Law Garden Market for buying handicraft and Gujarati outfits</li></ul>10<br />Batch 2009-2911<br />Stevens Busin...
STRENGTHS<br />Quintessential Indianness in fabric through the years<br />Popular for authenticity of hand-woven fabric<br...
OPPORTUNITIES<br />Latent potential of organic foods market<br />Leveraging changing consumer tastes & perceptions<br />Aw...
THREATS<br />Unorganized local operators<br />Handloom retail shops/chains in regional pockets<br />Souvenir shops providi...
MARKET SURVEY<br />Objective:  To explore: <br />The affective responses Fabindia’s consumers<br />Cognitive responses of ...
MARKET SURVEY<br />16<br />Batch 2009-2911<br />Stevens Business School<br />
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Marketing Plan for Fabindia, Ahmedabad

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  • Transcript of "Marketing Plan for Fabindia, Ahmedabad"

    1. 1. PGP Project PresentationMarketing Planfor FABINDIA, Ahmedabad<br />Presented By:<br />NIKITA SANGHVI<br />
    2. 2. FLOW OF PRESENTATION<br />Introduction<br />Current Marketing Situation<br />Threats and Opportunities Analysis<br />Objectives and Issues<br />Marketing Strategy<br />Action Program<br />Recommendations<br />Batch 2009-2911<br />Stevens Business School<br />Marketing Plan<br />
    3. 3. INTRODUCTION<br />FABRIC OF INDIA<br />India's largest private platform for products that are made from traditional techniques, skills and hand-based processes<br />Initially commenced as a village based industry in 1960 by John Bissell<br />Links over 40,000 craft based rural producers to modern urban markets<br />Promotes inclusive capitalism, through its unique COC (community owned companies) model<br />Marketing Plan<br />Batch 2009-2911<br />Stevens Business School<br />
    4. 4. INTRODUCTION<br />Fabindia Products<br />Batch 2009-2911<br />Stevens Business School<br />Marketing Plan<br />TEXTILE BASED <br /><ul><li>ready-to-wear garments
    5. 5. accessories for men, women, </li></ul>teenagers and children; <br /><ul><li>bed, bath, table and kitchen linen;
    6. 6. floor coverings, upholstery fabric and curtains.
    7. 7. Cotton, silk, wool, grass, linen and </li></ul>jute are the basic fibres used<br />NON- TEXTILE BASED<br /><ul><li>Home Products (October 2000)</li></ul> furniture, <br /> lighting, <br /> stationery, tableware, <br /> cane baskets <br /> selection of handcrafted utility items<br />NON- TEXTILE BASED<br />Organic Food Products (July 2004) <br /> cereals, <br /> grains, <br /> pulses, <br /> spices, <br /> sugar, <br /> tea, <br /> coffee, <br /> honey, <br /> fruit preserves<br /> herbs<br />NON- TEXTILE BASED<br />Authentic Personal care products (March 2006)<br />soaps, <br />shampoos, <br />hair oils, <br />pure oils, <br />moisturizers, <br />body scrubs, <br />face packs, <br />hair conditioners <br />special skin care products<br />
    8. 8. INTRODUCTION<br />Awards for Fab India<br />• Awarded “Best Retail Brand, 2004” by The Economic Times of India.<br />• Got “Designer Promoting Indian Craft or Technique award” as Hall of Fame reward.<br />Annual Report(2008-09)<br />Annual turnover of the company is in the range of Rs 500 crore<br />Profit ranges between Rs 35- 40 crore. <br />Registered a CAGR of about 58% in the period 2006-2008 <br />Batch 2009-2911<br />Stevens Business School<br />Marketing Plan<br />
    9. 9. INTRODUCTION<br />FabindiaStore locations<br />108 stores in 40 major cities of India. <br /> 6 stores in international places including UAE, Dubai, Bahrain, Italy and Rome.<br />Online Shopping & Exports to 34 countries<br />Batch 2009-2911<br />Stevens Business School<br />Marketing Plan<br />
    10. 10. Fab India: timeline<br />Early 80’s <br />1990’s<br />1999<br />2001<br />2004<br />2006<br />2010<br />1960<br />7<br />Batch 2009-2911<br />Stevens Business School<br />Vision:200 stores and a turnover of Rs.1000 crore by 2011<br />
    11. 11. CURRENT MARKETING SITUATION<br /><ul><li>A delighted Customer is our Best Brand Ambassador”
    12. 12. USP : quality of the fabric and the cultivated image of ‘Indianness’
    13. 13. Does not follow any customer acquisition strategy: focuses on customer retention
    14. 14. Key element: word of mouth publicity ( Zero advertising except print ads during promotions ), advertorials, mobile marketing, in-store posters
    15. 15. Mystery Shopper Program: to check the customer satisfaction level
    16. 16. Motivating factor for the customer: quality and consistency of product and the service
    17. 17. Over 83% of Fabindia’ s customers go back satisfied, with 58% being highly satisfied with the brand and its offerings</li></ul>SOURCE: Interview of Mr. William Bissel, MD, Fabindia published in The Economic Times, Jun 2009<br />8<br />Batch 2009-2911<br />Stevens Business School<br />
    18. 18. CURRENT MARKETING SITUATION<br />Batch 2009-2911<br />Stevens Business School<br />Marketing Plan<br />FabIndia Store Format<br /><ul><li>It has designed the stores’ decor and ambience keeping this in mind
    19. 19. The layout usually keeps clothes section at the back of the store and the entrance area is utilized for home products.
    20. 20. The exclusive jewellery counter is also kept in the fronts.
    21. 21. Metros
    22. 22. Posh locality
    23. 23. All product lines
    24. 24. Tier II cities
    25. 25. Specific products retailing</li></li></ul><li>COMPETITION<br /><ul><li>Garments Based (Shoppers Stop, Pantaloons, Westside, Reliance Trends, Globus)
    26. 26. Government Handloom Initiatives (KhadiGramodyog, Cottage Industries Emporium, State Government departments)
    27. 27. Designer Boutiques</li></ul>Ethnic wear retailers like Khadder, W and Good Things, and Stand alone stores like Shristi, Biba, Anokhi<br /><ul><li>Local tailors who provide customised garments to the customers at reasonable prices
    28. 28. Local NGOs selling wares,
    29. 29. Regional -Law Garden Market for buying handicraft and Gujarati outfits</li></ul>10<br />Batch 2009-2911<br />Stevens Business School<br />
    30. 30. STRENGTHS<br />Quintessential Indianness in fabric through the years<br />Popular for authenticity of hand-woven fabric<br />Sourcing system from rural India<br />Strong supplier relationship<br />Provision of capital loans (in agreement with banks)<br />Leniency on order fulfilment & no-return policy<br />100% use of supplier’s capacity<br />Sustainable employment opportunities to rural skilled poor<br />Employees are given autonomy and hence inducing accountability<br />Focus on customer retention instead of generation<br />Large chunk of buyers are repeat purchasers<br />Product quality improvement done keeping this in mind<br /><ul><li>Word-of-mouth strong enough not to require any advertising</li></li></ul><li>WEAKNESSES<br />Delays in delivery from artisans<br />Opportunity losses due to irregularity<br />Difficult to predict quantity and time of thaancoming from weaver<br />Also arises as different stores are encouraged to order different stock<br />Insignificant spend on marketing communications<br />Losing out on attracting new customers instead of depending only on repeat purchase<br />Not enough personnel to push Fabindia to greater growth<br />Unavailability of people experienced in retail sector<br />Unavailability of people believing in the same mission<br />More formal processes would face resistance from existing employees<br />Untimely delivery of products<br />Transport, storage and shelf-life issues of organic foods<br />Suppliers were spread pan-India<br />
    31. 31. OPPORTUNITIES<br />Latent potential of organic foods market<br />Leveraging changing consumer tastes & perceptions<br />Awareness generation of merit in these foods<br />Utilize multi-brand retail outlets and construction groups<br />Display of Fabindia products in MBOs and department stores<br />Leverages footfalls of the store, increasing likelihood of sales<br />Use of Fabindia home furnishings in modular flats of buildings<br />If consumer buys this flat or any other, and is impressed, will use Fabindia furnishings<br />Leveraging Web 2.0 tools and techniques<br />Tying up with matrimonial sites for designer fancy wedding wear<br />Interactive website for designing as per individual requirements<br />Customization level is high<br />Lead time between fixing of occasion date and event can be used for delivery<br />
    32. 32. THREATS<br />Unorganized local operators<br />Handloom retail shops/chains in regional pockets<br />Souvenir shops providing indigenous products at lower prices<br />Entry of organized brands and companies into retail<br />High expected growth & entry of business houses in large ways<br />Competitors access funds from conglomerate partners or markets<br />Tilt of Indian consumers towards foreign brands<br />Foreign brands alter lifestyle choices of the target market<br />“Imported” or designer home furnishings have greater ‘flaunt value’ vis-a-visFabindia<br />Development of government co-operatives<br />Boost in future to KVIC and state handloom units<br />Improvement in their ambience and shopping experience<br />Rising prices of real estate could hamper growth<br />Opening new stand-alone stores will be tough<br />Experimenting with formats and markets may not be advisable<br />
    33. 33. MARKET SURVEY<br />Objective: To explore: <br />The affective responses Fabindia’s consumers<br />Cognitive responses of Fabindia’s consumers <br />Purchasing behavior of the consumers for products of apparel category<br />Sampling Design<br />Sampling Unit : Customers of Fabindia<br />Sampling techniques : Convenience Sampling<br />Sample size : Customers -30<br />Batch 2009-2911<br />Stevens Business School<br />Marketing Plan<br />
    34. 34. MARKET SURVEY<br />16<br />Batch 2009-2911<br />Stevens Business School<br />
    35. 35. MARKET SURVEY<br />17<br />Batch 2009-2911<br />Stevens Business School<br />
    36. 36. MARKET SURVEY<br />18<br />Batch 2009-2911<br />Stevens Business School<br />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.<br />
    37. 37. MARKET SURVEY<br />19<br />Batch 2009-2911<br />Stevens Business School<br />Rate your experience at Fabindia in terms of your satisfaction level for the following: (Highly Satisfactory, Satisfactory, Average, Unsatisfactory, Highly Unsatisfactory)<br />
    38. 38. SUMMARY OF MARKET SURVEY<br />Batch 2009-2911<br />Stevens Business School<br />Marketing Plan<br />
    39. 39. 21<br />Batch 2009-2911<br />Stevens Business School<br />
    40. 40. 22<br />Batch 2009-2911<br />Stevens Business School<br />
    41. 41. Batch 2009-2911<br />Stevens Business School<br />Marketing Plan<br />
    42. 42. FABINDIA: 2011<br />Early 80’s <br />24<br />Batch 2009-2911<br />Stevens Business School<br />
    43. 43. FINANCIAL COMPARISONS<br />Financial aspects of Fabindia have been compared with Pantaloons<br />Though not a direct competitor, it represents the Indian Retail Industry very well<br />Financials for its direct competitors such as Anokhi, Khadi Gram Udhyog etc. were not available, restricting comparison<br />This assessment contrasts the performance of Fabindia with respect to the biggest retailer of India<br />Hence, we get a sense of the feasible options available with Fabindia to raise funds<br />
    44. 44. INTEREST COVERAGE RATIO<br />Batch 2009-2911<br />Stevens Business School<br />Marketing Plan<br />The interest coverage ratio of Fabindia is far higher than that of Pantaloons. Hence, raising funds through debt is not a big challenge.<br />
    45. 45. INTEREST COST AS % OF SALES<br />Batch 2009-2911<br />Stevens Business School<br />Marketing Plan<br />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.<br />
    46. 46. PROFIT MARGIN RATIO (IN %)<br />Batch 2009-2911<br />Stevens Business School<br />Marketing Plan<br />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.<br />
    47. 47. OPTIONS AVAILABLE<br />DEBT FINANCING <br />Pros<br />The decision authority stay with them, hence can stick to their mission<br />Healthy current ratio (around 2:1 throughout years)<br />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%)<br />A very healthy debt to equity ratio <br />Interest cost as a percentage of Sales is very low (0.006%)<br />Family owned<br />Cons<br />Debt acquired may not be huge<br />Loose out on the expertise of other organisations which can be brought in through JVs or investments<br />
    48. 48. OPTIONS AVAILABLE<br />PRIVATE INVESTORS/ JVs<br />Pros<br />Huge investments can be brought in<br />Professional expertise can be brought in<br />Cons<br />Decision authority gets diluted<br />Emphasis may shift to profit maximisation and hence Fabindia’s mission may get diluted<br />
    49. 49. CULTURAL EVENT(ON GROUND ACTIVATION)<br /><ul><li> The FabIndia Website gives information about the various fabric crafts like Chikankari, Kalamkari, Batik etc. for the customers.
    50. 50. We will bring this art on ground for them to experience it first hand and also learn it.
    51. 51. 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.
    52. 52. It will be called “Know what you wear”
    53. 53. This makes the customers more aware of the work put in for their fabric and helps them with their association with brand FabIndia.
    54. 54. It will also have a regional food festival at the same time to make it an overall fun and enriching experience.</li></ul>31<br />Batch 2009-2911<br />Stevens Business School<br />
    55. 55. “WOMEN OF TODAY”<br /><ul><li> As an extended activity, on weekends FabIndia will have “weekend promotions” with special focus on “Women of Today”.
    56. 56. 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”
    57. 57. FabIndia will tie up with various NGOs like Breakthrough, Jagori etc. for their cause of empowering women.
    58. 58. Viral video to be launched in association with Breakthrough ( along the lines of Mann keManjeere)</li></ul>Objective- <br />The passion group identifies with the theme ““Women of Today” and results in new customer acquisition<br />32<br />Batch 2009-2911<br />Stevens Business School<br />
    59. 59. RECOMMENDATIONS AT A GLANCE<br />Heavy investments in back-end of value chain<br />Supply chain development for efficiency and quality management<br />Expansion aiding strong regional presence<br />Outlets to counter regional competition<br />Sourcing from local suppliers for outlet and other regions will be easier<br />Growth through harnessing new customers<br />Cannot depend on existing customers to counter competition<br />Must create new customers in all segments<br />Tie up with different types of graduate schools for talent<br />Rural management graduates for managing supply chain and rural initiatives<br />Management graduates for helping growth in front-end and retail arms<br />
    60. 60. THANK YOU<br />Batch 2009-2911<br />Stevens Business School<br />Marketing Plan<br />
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