Reliance Fresh Store Promotions


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Reliance Fresh Store Promotions

  1. 1. Retail Promotions at Reliance fresh From 1/10/2008 to 31/10/2008 Submitted By: Submitted To: Mukesh Kumar Ms. Shalini Srivastava PGDRM-2b Faculty Centre for Retail Retail Promotions FDDI
  2. 2. Executive Summary Retailing is the interface between the producer and the individual consumer buying for personal consumption. This excludes direct interface between the manufacturer and institutional buyers such as the government and other bulk customers. A retailer is one who stocks the producer’s goods and is involved in the act of selling it to the individual consumer, at a margin of profit. As such, retailing is the last link that connects the individual consumer with the manufacturing and distribution chain. The retail industry in India is of late often being hailed as one of the sunrise sectors in the economy. AT Kearney, the well-known international management consultancy, recently identified India as the ‘first most attractive retail destination’ globally from among thirty emergent markets. It has made India the cause of a good deal of excitement and the cynosure of many foreign and domestic eyes. The entry of foreign and Indian retail giants like Wal-Mart, Metro, Reliance, Birla, Tata etc. made Indian market more competitive which is at cut throat level. Sohow retailers can reach to their end customers, to win the mind share and increase the basket size of each shopping trip. Now the role of advertisement and promotions come “If you don't discount you'll lose business fast Money talks louder than into play. nationalistic appeals to the public not to purchase from the lower-priced Advertisement is quot;Foreign storequot; down the road. A large band of wholly Thai-owned stores ranging from small family firms to medium-sized players protested against the way of 7 the presence of the international retailers. ” effective communication to the customers and promotions plays an important role to attract the customer and to do business. To understand the effectiveness and types which are used by the retailers in India this project was done on the “Reliance fresh” a retail chain with a PAN India presence. The role of promotions, Advertisements are now become a strategy to win the race as per the ‘Bangkok Post in year 2001’. After analyzing all the aspects of promotions at Reliance fresh, I concluded that the communication mix used is more effective and penetrating. Reliance fresh is able to attract customer’s attention and earn targets. The area where Reliance fresh needs to focus is the concept ofIMC programme which can make its promotional programme more effective and efficient. At the end congratulations and all the best to whole Reliance fresh team for doing such a wonderful task, this helped me in improving my knowledge. 1.0. Objectives: I. To understand store promotions at Reliance fresh.
  3. 3. II. To understand the different modes of communication used by Reliancefresh. III. To understand IMC tools used by the competitors of Reliance fresh. IV. To analyze the effectiveness of promotion at Reliance fresh. s 2.0. Company Profile:
  4. 4. The Reliance Group, founded by Dhirubhai H. Ambani (1932-2002), is India's largest private sector enterprise, with businesses in the energy and materials value chain. Group's annual revenues are in excess of USD 27 billion. The flagship company, Reliance Industries Limited, is a Fortune Global 500 company and is the largest private sector companyin India. Backward vertical integration has been the cornerstone of the evolution and growth of Reliance. Starting with textiles in the late seventies, Reliance pursued a strategy of backward vertical integration - in polyester, fiber intermediates, plastics, petrochemicals, petroleum refining and oil and gas exploration and production - to be fully integrated along the materials and energy value chain. The Group's activities span exploration and production of oil and gas, petroleum refining and marketing, petrochemicals (polyester, fiber intermediates, plastics and chemicals), textiles and retail. Reliance enjoys global leadership in its businesses; The Group exports products in excess of USD 15 billion to more than 100 countries in the world. There are more than 25,000 employees on the rolls of Group Companies. Major Group Companies are Reliance Industries Limited (including main subsidiaries Reliance Petroleum Limited and Reliance Retail limited) and Reliance Industrial Infrastructure Limited. 2.1. Founder profile: - quot;Growth has no limit at Reliance. I keep revising my vision. Only when you can dream it, you can do it.quot;
  5. 5. Dhirubhai H. Ambani Founder Chairman Reliance Group December 28, 1932 - July 6, 2002 Dhirubhai Ambani founded Reliance as a textile company and led its evolution as a global leader in the materials and energy value chain businesses. 2.2. Reliance Retail Limited: - Reliance is gearing up to revolutionize the retailing industry in India. Towards this end, Reliance is aggressively working on introducing a pan-India network of retail outlets in multiple formats. A world class shopping environment , state of art technology, a seamless supply chain infrastructure , a host of unique value-added services and above all, unmatched customer experience, is what this initiative is all about. The retail initiative of Reliance will be without a parallel in size and spread and make India proud. Ensuring better returns to Indian farmers and manufacturers and greater value for the Indian consumer, both in quality and quantity will be an integral feature of this project. By Creating value at all levels, wewill actively endeavor to contribute to India’s growth. The project will boast of a seamless supply chain infrastructure, unprecedented even by world standards. Through multiple formats and a wide range of categories, Reliance is aiming to touch almost every Indian customer and supplier. 3.0. Promotional Mix: - Promotion includes marketing activities used to inform, persuade and remind the target market of an organization. Its product, services and other activities can help a firm justify its existence and maintain positive and healthy relationships with various groups in the marketing environment. Marketing mix is a major concept in modern marketing and
  6. 6. includes that the marketer uses to create a blend that would influence the demand for its product and services. It is a set of controllable, tactical marketing tools that the firms use to achieve its objectives in the target market. Retailers usually employ a combination of various elements of promotion mix to achieve promotional and business objectives. The degree and the nature of usage of each of the retail firm, product, market profile and availability of resources. For example it depends on the nature of a firm like a chain or individual, its product type (Fashion, FMCG, Home Furnishing etc) or the profile of the target market. In this part of promotional mix only the communication mix is taken into consideration. “Communication mix is a mean by which firm attempts to inform, persuade, and remind consumers – directly or indirectly- about the products and brands that they sell”. In a sense, marketing communication represents the ‘voice’ ofthe brand and are a means by which it can establish a dialogue and build relationships with consumers. First discuss the whole communication process models with reference to reliance fresh. The communication process (Macro model of communication) involves two elements represents the major parties in a communication- Sender and Receiver while the other two represents the communication tools- Message and Media. Message SENDER Encoding Decoding RECEIVER Media Feedback Response Figure: Elements in communication process 3.1. Sender: Here sender is Reliance fresh; it encodes the information regarding the promotions and offers for its potential customers. The tools of communication are discussed further. 3.2. Message: The six major communication tools (Message) used in the ‘Reliancefresh’ are as follows:
  7. 7. 1. Advertising: Any paid form of non-personal presentation and promotion of ideas, goods, or services by an identified sponsor. The advertising part at Reliance fresh is done with the help of print and broadcast ads, packaging outer, catalogue, directories, billboards, symbols and logos and audio materials. Type Mode Print or broadcast ads With the help of National Newspapers and Local Newspaper. Packaging outer Providing carry bags including brand name and logo. Catalogue Distribution of catalogue through newspapers and to the customers inside the store. Directories Advertisements in Tata yellow pages,MTNL telephone directory and through Just Dial. Billboards Billboards outside the store. Audio Material Audio material inside the store including the latest promotions and offers. Point-of-Purchase Displays Point- of- Purchase displays are used at reliance fresh to communicate the benefits of a products. 2. Sales Promotions: a variety of short term incentives to encourage trail or purchase of a product or service. The sales promotion at Reliance fresh includes premiums and gifts, Sampling, rebates, Offers like BOGO and BXGY etc. Type Mode Premium and Gifts Premiums in the form of ‘Bill Busters’ on the purchase of a fixed amount every week. E.G. Pickle Set (set of 4) is free with the purchase of Rs.999/- Sampling Distribution of samples of test merchandise in the store and with certain products. E.G. free samples of “Pick” pickle was distributed which was test merchandise. Rebates Discount on MRP of certain products. Offers: BOGO Buy One Get One BXGY Buy X and Get Y
  8. 8. 3. Events / Experiences: company –sponsored activities and programs designed to create daily or special brand-related interacti ns. The event at LM365 includes festivals, store o tour. Type Mode Social Event I. Tie-up with the ‘Mosquitoes awareness programme” launched by ‘ALLOUT’; making people aware about the diseases like Dengue, Chikangunia and Malaria. II. Tie-Up with ‘Colgate’ for their “Oral Health Month, October 2008” having mission- zero tooth decay. Store tour Reliance fresh facilitate a store tour to the students of Play school in nearby society which makes easier the Learning process of students with a fun and a practical exposure and on the other hand associat ng children’s i with Reliance fresh. Pictures: Students of Venkatesh International School at Reliance Fresh
  9. 9. 4. Public relation and publicity: a variety of programs designed to promote or protect a company’s image or its individual product. The public relations at LM365 include charitable donations, Seminars and camp. Type Mode Camps Free pollution checkup camp on earth day. Publications Reliance publishes a magazine known as ‘Money Life’ which provides details regarding the investment and market status. 5. Personal Selling: Face-to-face interaction with the one or more prospective purchases for the purpose of making presentations, answering questions, and procuring orders. There are no such practices done at Reliance fresh. 6. Direct Marketing: use of mail, telephone, fax, e-mail, or internet to communicate directly with or solicit response or dialogue from specific customers and prospects. This platform is used to inform the “Reliance one” members (a loyalty programme) through e-mails, Telephones and SMS. Through this the information regarding the lates offers, events are t being communicated to the customers. 3.3. Media Selection: The media vehicles used by reliance fresh are as follows: The media vehicles used by reliance freshfor promotion is only ‘Newspaper’. The PAN India promotions are communicated through the newspapers (corporate level) and the regional level is communicated with the brochures inserted in the news papers. During the Diwali period the PAN India promotion are encoded through the newspapers in Jodhpur (Rajasthan) but not in Delhi and NCR. 3.3.1. Newspaper: Reliance fresh uses Newspaper as an effective media vehicle. It uses newspaper for national and regional advertisement. The details regarding the use of newspaper as a media vehicle is as follows: used: For Corporate level communication the full both side page of some newspapers like “Dainik Bhaskar” (in Rajasthan) are used and for Regional level communication
  10. 10. insertion are used with the help of tie-ups with the local newspaper hawker.The copy of Newspaper advertisement and insertion is attached with the report. Scheduling: The insertions of weekly promotions are distributed on Friday along with the newspapers. The reason behind selecting Friday as a day for reaching the customers is that maximum customers do their bulk purchases during weekends and making them aware regarding the promotions before the weekend i.e. Friday is used. 3.3.2. In-Store: Reliance fresh uses media for in-store communication. The in-store level of communication is done throu following modes: gh Point-of-Purchase: The point of purchase is used to communicate the promotions with the help of ‘Shelf-Talkers’. Shelf-Talker is a mode of communication at the shelf wherethe product is displayed. Danglers: Danglers are the sinages which are hanged through the ceiling of the store communicating regarding thepromotions and offers. A copy of danglers used in Reliance fresh during the period of study is attached with the report. Audio Material: all the promotions are communicated to all the visiting customers through audio system installed in the store. Every store receives a audio file which contains all the details regarding the latest promotions and offers. Leaflets: leaflets are distributed to every customer entering the store for the current promotions and for the forthcoming promotions as well. (Customer Care Associates): Customer Care Associate the sales force inside the store is also a vehicle for communication. 3.4. Decoding: Decoding is a process in which the targeted customerconverts the encoded message by the sender as per it need. Here the encoder is Reliance fresh and the decoder is a customer. The customer decodes the message as per its need and wants. The customer analyzes and decodes the message as per his/her need or demand and goes for the next step of Response. The response can be negative and positive. If the response is positive than the customer goes for a purchase from Reliance fresh and if the response is negative than the customer will not go for purchase.
  11. 11. 3.5. Response: the response shown by the customer is fully dependent on the meeting of customers need and demand with the communication. If the message is compatible with the need of the customer than the customer will show a positive response in the form of purchase and if it is not compatible than no response from customer. 3.6. Feedback: Feedback is the end of every communication and can be the beginning of other communication. A feedback is taken from the customers visiting the store. There is a feedback form which is provided to every store of Reliance fresh from the management which is helpful in developing the next promotional programme. This feedback form is not taken in consideration by the store staff. The feedback form used in Reliance fresh is attached with this report. 4.0. Brand Identity: In this part of brand identity the outer core level is taken in consideration. The major levels are as follows: BRAND IDENTITY 4.1. Design: the design of the brand reflects which it want to communicate to its customers. In s Reliance fresh being a store its design of reflects that it is a low cost because the fixtures and the cost of the store looks very low and gives a feel of budget shopping and use of graphics
  12. 12. throughout the store and outside the store attracts the customers and communicate the deliverables of the store. 4.2. Logo/Symbol: The logo of Reliance fresh includes a leaf structure which represents freshness. 4.3. Brand name: The brand name consists of two parts one is ‘Reliance’ which means the name of parent company ‘Reliance Industries Limited and secondly t e “Fresh” means ‘provides h fresh merchandise’. 5.0. Integrated marketing communication (IMC): - a concept of marketing communication planning that recognizes the added value of a comprehensive plan that evaluates the strategic roles of a variety of communication discipline and combines these disciplines to provide clarity, consistency and maximum communication impact. In short combine the disciplines to provide clarity, consistency and maximum communication impact. The main reasons behind the growth in importance of IMC tools are shift from media advertising to other forms of marketing communication, rapid growth of database marketing, and increasing importance of branding. The POP displays ALLOUT event Danglers in-store
  13. 13. Diwali Special Colgate event 5.1. IMC programme situation analysis: The situation analysis of IMC programme includes the external factors which includes the environment analysis and competitive analysis. The study of environmental analysis is done by endeavoring on the technological, demographic, Socio/Cultural and economic aspects and they are as follows: Environment Analysis: Technological Demographic  Increase in the number of media  Growth in the per capita income and vehicles. spending power of Indian consumers.  Rapid growth of internet.  Increase in the number of working  Technology became a part of life e.g. women. Increase in the no. of television users,  Increase in the number of nuclear user of internet. families. Socio/Cultural Political/Legal  Affected by celebrity endorsement.  Consumer forum restriction.  Visible is more admired.  Opposition of ads by community’s e.g.  Increase in the number of male fair and lovely commercial. shoppers.  Touch and feel factor before purchase is important. Economical  Increase in the number of advertisement agencies.  Advertisement is considered to be the most important part of business.
  14. 14. Competitors IMC situation analysis includes the areas like direct or indirect competition, position relatives to competitors, and size of competitors advertising, promotional budget and IMC strategies used by competitors. Direct competitors Indirect competitors  Reliance fresh is facing direct  Indirect competition from Safal by competition from LM365. Mother Dairy, local Kirana stores, Push- cart Vendors. Size of Competitors promotional budget IMC strategies used by the competitors  The promotional budget is low in case  IMC of LM365 is having an advantage of local players, Mother dairy and of their communication programmeand Reliance fresh. thus helps in greater penetration.  Rest of the IMC strategies is similar as compared to LM365. 5.2. Push V/s Pull Strategies: Push strategies which are provided by the retailers to the customers and whereas the pull strategies are the demand of customers. Talking about the push and pull strategies of LM 365 are as follows in the matrix: PUSH PULL  Point of sale displays.  Coupons  Special Displays.  Samples  Dealers Premium, Gifts.  Premium and gifts  Advertising materials.  Refunds/Rebates  Catalogs and brochure.  POP advertisement.  Events.  Sampling.
  15. 15. 6.0. The communication gap: Every communication programmehas a level of gap in it. The same was observed in case of Reliance fresh. The gap is found in many areas:  The Customer Care Associates were unaware about the promotions.  The whole duty of promotions is performed by only one person known as ‘Promo Champ in the store’. Hence, reduces awareness among the whole staff.  Displayed promotions are not accepted by the EPOS (Electronic Point of Sale). . These above listed gaps somehow making the promotional communication of Reliance fresh a failure to some extent. So, Reliance fresh needs to overcome above listed gap to have a effective promotional communication. 7.0. Conclusion: After analyzing all the aspects of promotions at Reliance fresh I concluded that the communication mix used is more effective and penetrating. Reliance fresh is able to attract customer’s attention and earn targets. The area where Reliance fresh needs to focus is the gap factor in communication programme which can make its promotional programme more effective and efficient. At the end congratulations and all the best to whole reliance fresh team for doing such a wonderful task.