The document provides an overview of the global and Indian retail industry. It discusses key segments in Indian retail like fashion, food and grocery, and formats like supermarkets, department stores, and specialty stores. Organized retail is growing rapidly in India and will reach 10% of the total retail market by 2010. The case study focuses on global retail giant Walmart, discussing its founding, business model centered around "everyday low prices", global presence and strategies. It indicates Walmart sees potential to grow in India through a joint venture with Bharti Enterprises to explore retail opportunities while respecting local markets.

1. Retail Industry

2. Contents
INTRODUCTION
GLOBAL OVERVIEW
INDIA RETAIL SCENARIO
CONSUMER TRENDS
KEY RETAIL SEGMENTS
RETAIL FORMATS
KEY DRIVERS
THE WAY FORWARD
CASE STUDY

3. Introduction
Retailing consists of the sale of goods or merchandise,
from a fixed location such as a department store or kiosk, in
small or individual lots for direct consumption by the

4. Global Overview

5. Global Powers of Retailing 2006, Deloitte and Stores Magazine, Annual
The list of the biggest retailers in
the world is dominated by the
grocers:
Wal-Mart (USA);
Carrefour (France);
The Home Depot (USA);
METRO Group (Germany);
Tesco (UK);
Kroger (USA);
Costco (USA);
Target Corp (USA);
Koninklijke Ahold (Netherlands);
Aldi GmbH & Co (Germany).
• The state of retailing is dependent
on consumer confidence and key
economic factors, so retail practices
vary between countries.
• In the USA, for example, one third
of all sales are through franchised
stores
• In Sweden, 20% of retail sales are
through co-operatives.
• Countries with the most developed
online markets include the UK, the
USA, Scandinavian countries,
Germany, France and Japan.

6. India - Journey from Kiranas to Malls
• Mom & Pop having a shop in backyard
• More than 99% retailers function in less than 500Sq.Ft of area
• Styles were on regional basis and purchases during some specific
occasions
• 1980s - Indigenous franchise model of store chains run by Khadi &
Village Industries Commission
• Bombay Dyeing, Raymond's, S Kumar's and Grasim first saw the
emergence of retail chains
• 1990s - Fresh wave of entrants with a shift from Manufactures to Pure
retailers

7. And the Indian consumer is changing….

8. • Fastest growing economy
• Nuclear families
• Young customer assumes greater power
• Increase in the number of working women to boost consumption
• Luxury, no longer, carries a guilt factor
• Easy bank credits
• ‘Preference for value’ no longer a compromise
• New generation of designers and branded manufacturers
• ‘Shop till you drop’ syndrome

9. Consumption & Consumer trends
• Private consumption has a direct bearing on the health and growth of
retail
• Total Private Consumer Spend – Rs.18,90,619 crore
• Spend in the Domestic Retail Market – Rs.15,96,802 crore growing at
6%
• Spend in the Organised Retail Market – Rs.48,500 crore growing at
36%
• The Indian consumer is among the youngest in the world as compared to
ageing population of USA, China, Japan, UK etc.

10. Key Retail Segments

11. SEGMENT MARKET SIZE ORGANISED % EXAMPLES
Fashion Rs.113,500 crore 19% UCB, Marks & Spencer,
John Players
Footwear Rs.13,750 crore 37.8%
(2nd
most organised)
Reebok, Adidas, Nike,
Puma, Bata, Liberty
Timewear & Eyewear Rs.3,950 crore 46%
(most organised)
Titan, Timex
Jewellery Retail Rs.52,000 crore 3% Tanishq, Kiah, Orra,
Ddamas
Books, Music, Gift Rs.11,500 crore 12.6% Landmark, Crossword,
Planet M, Hobby Ideas
Home & Office Rs.35,100 crore 7% Portico, Pergo, Fab India
Fitness & Personal
Care
Rs.3,300 crore 10.6% VLCC, Kaya, Lakme
Health & Pharma Rs.38,500 crore 2.6% Apollo, Himalaya Drugs,
Lifeken
Food & Grocery Rs.744,000 crore 0.8% Food world, Subhiksha,
Reliance Fresh

12. SEGMENT MARKET SIZE ORGANISED % EXAMPLES
Entertainment Retail Rs.35,000 crore 4% Adlabs, PVR, Shringar,
Zapak
Telecom Retail Rs.18,700 crore 3% Airtel, Hutch, Idea,

13. Retail Formats

14. Format Description Example
Super Markets Is one that is departmentalized into self-service
stores and offers a range of food household
articles situated in a convenient area, pref.
near residential localities. Focuses on price
positioning with products at lower prices
Nilgiris was the first
supermarket in Bangalore.
Others are Apna Bazaar,
Foodworld, Subhiksha
Department Store represents a retail outlet that stocks a variety of
merchandise ranging from apparel, tolietries,
cosmetics, toys, jewellery, furniture, etc.
Shoppers Stop, Pantaloon,
Westside, Lifestyle
Hypermarket represents a supermarket that has the features
of both a supermarket and a department store
and is mainly located in the outskirts of major
towns and cities
Big Bazaar of Pantaloon
Retail, Star India Bazaar of
Trent, HyperCity of
K.Raheja, Choupal Sagar
– India’s first rural
hypermarket
Convenience Store stores that are open 24x7 & stock most
essential and FMCG such as food items,
personal care, etc. Mostly located at fuel
stations or areas where they may not be other
stores offering day-to-day items
My Mart, In & Out

15. Format Description Example
Speciality Store are the ones that sell specific merchandise with
focus on a single category
Planet M, Crossword, Kids
Kemp
Kiosks/ Food
Counter
Retail outlet structures which are open on all
sides and mostly engage in selling consumer
goods like edible snacks, newspapers, etc.
They are mostly located at high streets, malls,
multiplexes
Corn Man, Brownie
Cottage, Shiv Sagar,
Kailash Parbat
Discount Store
a type of department store selling products at
prices lower than that in other retail
outlet and appealing to the middle-class
segment in India
The Loot, My Dollar Store,
Max Retail

16. Retail Marketing Strategy

17. • Retailers must develop marketing strategies based on overall goals and
strategic plans
• Retailing goals might include more traffic, high sales of a specific item, a
more upscale image or heightened public awareness of the retail
operation.
The key tasks in strategic retailing are defining & selecting a target market and
developing the retailing mix to successfully meet the needs of the chosen target
market
The
Target
Market
Retail
Marketing
Mix
Retailing Strategy

18. Defining a Target Market
• Successful retailing has always been based on knowing the customer
• The first and foremost task in developing a retail marketing strategy is to
define the target market. This process begins with Market Segmentation
• Target markets in retailing are often defined by demographics,
geographics and psychographics
Check List for Effective Segmentation
• Is the Segment Identifiable & Measurable?
• Is the Segment Accessible ?
• Is the Segment Substantial ?
• Is the Segment Actionable ?
• Is the Segment Defendable ?

19. Retail Marketing Mix
Product
Price
Promotion
Place
Presentation
(Layout)
4 Ps of
Marketing
+
3 Ps
(specific to Retail)
Retail Mix
People
Process

20. PRODUCT
• Width
• Depth
• Branding
• Inventory Management
PROMOTION
• Advertising
• Sales Promotion
• Public Relations & PR
• Personal Selling
PLACE
• Store Location
• Accessibility
• Distribution Coverage
• Shopping Amenities
PRICE
• Price Sensitivity of Segment
• Pricing Approach to be Adopted
• Level of Competition
• Profitability of Operations

21. PRESENTATION
• Product Display
• Fixture Type & Density
• Sound (Music)
• Odors
• Visual Factors (Colors)
PEOPLE
• Appearance
• Customer Service
• Selling Techniques Used
(Trading up & Suggestion Selling)
• Incentives
PROCESS
• Policies
• Procedure
• Mechanisation
• Flow of Activities

22. The Way Forward

23. Organized retail will form 10% of total retailing by the end of this decade (2010).
From 2006 to 2010, the organized sector will grow at the CAGR of around
49.53% per annum

24. Innovative
marketing
and selling
required
Retail consolidation and increasing
centralization of purchasing
activities
• National and international sourcing
decisions
• Traditional regional sales approach
• Government policy
Changes in consumer shopping
habits
• Growing importance of non –
traditional grocery channels
• Out of home consumption growing
• Channel partners demanding
sophisticated price and category
management capabilities from
manufacturers
• Erosion of consumer loyalty by
emerging internet shopping sites
and extended retailer programmes
(eg. shopper cards, high quality
label products)

25. Case study

26. Background
• Wal-Mart Stores, Inc. is an American public corporation, currently one of the world's
largest corporations (by revenues) and ‘the most admired retailer’ according to the 2007
Fortune 500
• It was founded by Sam Walton in 1962
• It is the largest private employer in the world (1.9 million) and the world's 4th
largest utility
or commercial employer, only trailing the People's Liberation Army of China, the National
Health Service of the United Kingdom and the Indian Railways.
If Wal-Mart were a country, it would be the 20th largest in the world
If Wal-Mart were a city, it would be the fifth largest in America

27. Insight
"The secret of successful retailing is to give your
customers what they want. And really, if you think about it
from the point of view of the customer, you want
everything: a wide assortment of good quality
merchandise; the lowest possible prices; guaranteed
satisfaction with what you buy; friendly, knowledgeable
service; convenient hours; free parking; a pleasant
shopping experience’’
-Sam Walton, founder, Wal-Mart Inc.

28. Vision
• Sam wanted to help the people living in small towns and
rural America enjoy a similar quality of life as those who
lived in the big cities.
• While retailers were rushing to the suburbs, Sam Walton
built a business serving these overlooked and under-
appreciated customers.
• Sam Walton’s dream to serve the under-served changed
the world.
• His method was to go where other businesses feared to
go.

29. An ideal point for entry into India???
Core Philosophy
"Respect for the Individual", "Service to the Customer" and "Strive
for Excellence"

30. Presence
• Nearly 6,500 (2700 internationally & 3800 in the US) stores and wholesale clubs across 13 countries
• More than 1.9 million Wal-Mart associates, serving 100 million customers a day.
Country Retail Units
Mexico 919
Puerto Rico 54
Canada 290
Argentina 15
Brazil 298
China 184
United Kingdom 337
Japan 392
Costa Rica 140
El Salvador 63
Guatemala 137
Honduras 44
Nicaragua 40
Retail formats
* Supercenters * Food and drugs * General merchandise stores
* Bodegas (small markets) *Cash and carry stores * Membership warehouse clubs
*Apparel stores *Soft discount stores * Restaurants.

31. Financials
Wal-Mart generated more than $312.4 billion in global revenue in
the fiscal year ended January 31, 2006, establishing a new record
and an increase of 9.5 percent operating at a profit of 3.5%

32. Global Marketing Strategy
PRICE
When it comes to marketing strategies, Wal-Mart sticks to its knitting. The basis of
the discounting philosophy is that by cutting price, sales can be boosted to a point
where the earning is more because of the increased volume of merchandise sold.
Every Day Low Price
Rollback
Special Buy
By unwaveringly maintaining its policy throughout its history, the retailer imparts a
consistent message to consumers
"low prices save you money.“
PLACE – SUPPLIER MANAGEMENT
Supplier base of nearly 3,000 suppliers.
Deliberately ensured it did not become too dependent on any one supplier
No single vendor constituted more than 4 percent of its overall purchase volume.

33. PLACE – DISTRIBUTION SYSTEM
“Saturation” distribution strategy
Satellite network system
PROMOTION - ADVERTISING
The ads project homey images and use real associates and customers
(not actors) to relate all the reasons why it's nice to shop at Wal-Mart.
Global Marketing Strategy

34. Global Marketing Strategy
Wal-Mart’s International Division:
Global Strategy, Local Focus
• Wal-Mart’s International stores, just like those in the U.S., provide
excellent customer service and convenience and they offer
working families the things they need at prices they can afford
• This approach is the reason Wal-Mart is being welcomed into
country after country around the globe, and it’s also why we have
tremendous potential to continue our rapid growth internationally.
• The beauty of Wal-Mart's marketing program is it's simplicity. Wal-
Mart has engendered a trust with customers that they will always
find that low price.

35. Accolades & Achievements
• In 2006, Wal-Mart was named “Employer of the Year”
• Wal-Mart Brazil is expected to create 6,500 new jobs 2007
• Five times in the past six years, Wal-Mart was ranked among
the best places to work in Canada
• ASDA was the only British supermarket to be featured in
“Britain’s Top Employers 2007.”
• Seiyu Japan received the “Minister of Environment Award”

36. • In 2007, Wal-Mart International plans to open 320 to 330 units in
existing markets.
• In November 2006, Wal-Mart signed a Memorandum of
Understanding with Bharti Enterprises to jointly explore retail
opportunities in India.
• Wal-Mart is trying very hard these days to reinvent themselves as
something cool and hip. They're creating different kinds of stores
and, like many other retailers, developing consumer-centric stores

37. India Gets ready for Wal Mart
India Gets ready for RETAIL!