I.I. IntroductionIntroduction

1.1 Objective of the study1.1 Objective of the study

Our group aims to meet the following objectives upon conducting this study: To Identify the retail format of BAYO and its competitors. To study and understand the company’s retail format To identify the advantages and disadvantages of BAYO with its

competitors. To identify the strength and the weaknesses of BAYO. To help improve the service provided by BAYO to its customers.

1.2 Brief history of the company1.2 Brief history of the companyBayo started out as a made-to-measure dress shop in Makati. The need to expand grew bigger when Bayo launched its ready-to-wear line. In 1992, the growing demand triggered the establishment of Lyncor, Inc., then a manufacturing firm, to support Bayo. “Bayo,” an ilonggo term which means, “dress” in English was chosen by the owners of the company since they are from Bacolod. Bayo reflects a clean, classic image. Bayo caters to women who embody the laid-back, casual lifestyle who have preference for stylish yet classic apparel.

II. Retail II. Retail FormatFormat

Retail Format Rating

Advertising and Promotion HIGH

Pricing HIGH

Customer Service HIGH

Location LOW-MID

Merchandise Assortment HIGH

Stor Design and Display MID-HIGH

Advertising and PromotionBased on observation, BAYO intensified their advertisement by

having lots of billboards. Also, BAYO strategically use well-known artists to promote their products so that it will be attractive and convincing. These apeal made the products easy to remember.

PricingSince BAYO is a specialty store, aside from the fact that it is a

known brand, it offers expensive but erasonable prices. Somehow luxurious but affordable.

Customer ServiceBAYO is giving a high customer service by means of providing

free iron and fold for purchased apparels. There is also a salesperson assisting the customers in the dressing area.

LocationBAYO’s location in Sta.Lucia is not that advantageous because

it’s not located on corners but the location is easy to be seen because it is along the hallway and it is good for competition because it is parallel to other retailers offering same product lines.

Merchandise assortmentBAYO is focused on providing wide

variety of merchandise assortment and other accessories. They did not only focus on clothing but also offer complementary accessories to have overall makeover.

Store Design and DisplayBAYO arranged and designed their

products according to color. This is one way to attract customer’s attention. The store’s wall is made of glass so that customers can see the products through the glass. They also have chairs for customers to sit on while waiting. They also have a separate rack for accessories.

 

III. Market Segmentation III. Market Segmentation Market segmentation

Geographic

City/municipality Marikina, Pasig, Montalban, San Mateo, Cainta, Antipolo

Polpulation Density Urban/Suburbian

Demographic

Age16-22, 23-29, 30-36

Gender Female

Family Life Cycle Single, young, married; ina relationship; married, no children;young married; married with children; separated,

others

Occupation Young urban professionals, students, housewife, white collar jobs

Psychosocial

Social class Middle Class (classes B&C)Lower Class (classes D&E)

LifestyleOld school, Sophisticated, Swinger

Personality Submissive, Aggressive, Aloof

Feelings and Behavior

Attitudes Positive, Neutral, Negative

Benefits SoughtEconomy, Self-esteem, Fasion

Readiness Stage Unaware, aware, informed, interested, desirous, intention to purchase

Perceived RiskHigh, Medium, Low

User Status Non-user, ex-user, potential user, current user

Loyalty status None, some, total

Involvement High, Low

Usage rateNone, light, medium, heavy

Usage situationHome, work, school, hang-outs/gimiks

Age 57% of total

population

Gender Population

16-22 10% Female 42,461

23-29 27% Female 114,645

30-36 20% Female 84,922

Marikina CityPopulation: 424,610

Age 57% of total

population

Gender Population

16-22 10% Female 61,730

23-29 27% Female 166,671

30-36 20% Female 123,460

Pasig CityPopulation: 617,301

Age 57% of total

population

Gender Population

16-22 10% Female 63,397

23-29 27% Female 171,172

30-36 20% Female 126,794

Antipolo CityPopulation: 633,971

Age 57% of total

population

Gender Population

16-22 10% Female 28,953

23-29 27% Female 78,174

30-36 20% Female 57,907

CaintaPopulation: 289,533

Age 57% of total

population

Gender Population

16-22 10% Female 22,359

23-29 27% Female 60,370

30-36 20% Female 94,719

MontalbanPopulation: 223,594

Age 57% of total

population

Gender Population

16-22 10% Female 18,486

23-29 27% Female 49,912

30-36 20% Female 36,972

San mateoPopulation: 184,860

3.1.2 Psychographic SegmentationFemales usually go to mall to seek for a need or to window shop

realizing that females are innately sophisticated. Because of this reason probably they are the possible target audience. As a clothing store thet focuses on women’s apparel, we are targeting females that are willing to submit or adopt the latest fashion. Instead of targeting females in the upper class, we focused on the market segment in the middle class realizing that upper class would prefer to visit stores having more expensive products.

3.1.3 Behavioral SegmentationFemales generally provide sufficient time in visiting malls to look for

products that will make them feel more beautiful. They give more effort in choosing, scrutinizing and deciding on which product they want to purchase from the factors of price, design, fashion and quality. Usually, females buy a prodcut to have self-esteem and be in. Primarily, females who seek for job, already workers and students probably have the intntion to go to BAYO store as well as using it for applying for a job and hang-outs.3.1.4 Need Segmentation•Females that are looking for classical but casual wear•Accessories that will complement in the casual wear that will fully satisfy the taste, prference, occasion, professions and social activities of its customers•Apparel with good and high quality materials that can be used in applying in profession and occassional purpose

3.2 Buying Decision

Extended problem solvingBAYO is a retail store that focuses on women’s casual but classical

wear as well as accessories and other complementary stuffs. A customer that visits the store has only considerable time and effort in choosing alternatives. We’ve observed that consumers that enters BAYO store have strong brand preference. Specialty stores like BAYO require an extended problem solving because of its high risk in terms of price. It doesn’t require customer loyalty. It’s only focused on brand and its price.

Financial RisksBAYO is considered to offer expensive but reasonable products. In

terms of this, money is the main concern. Customers expect to have quality products when they are to spend a lot of money.

Social Risk BAYO is updated to latest fashion and innovate their products to be

more attractive and unique. In terms of this, customers gain more confidence, most of the consumers were buying their products because they want to be in and want to improve the image they have with towards their family, riends and others.

3.3 Buying Decision Process

3.3.1 Need RecognitionCustomers that enters BAYO recognize their needs psychologically. In

fashion, customer feel good whenever they have products that is in the fashion. BAYO provide cutomers information about new trends and fashion. BAYO also make customers feel the need for power. They identify this need through the brand name. And for the main objective, BAYO wants to make customers feel the need to buy their products as a self-reward, personal gratification and one way to enhance one’s self-image. BAYO stimulates the customers crave by its store ambiance, design and location.

BAYO products may be identified as a functional need if and only if customers purchase the product because of a dertain occasion and gathering. But if customers will purchase the product just because they want to be in and for personal gratification then it would definitely be a psychologiacal need.

Psychological need•Learning new trends Fashion•Status and power Brand name•Self-reward Personal gratification Enhance one’s self-image•Stimualtion Store design Ambiance

3.3.2 Information Search

After identifying a certain need, now it’s time for customers to find a retailer that would satisfy this need. For them to be able to identify the best retailer, a customer wil collect enough informations from a list of retailers and or products under the same product line. Usually, customers would ask for friends or families opinions or recommendations. And to be able to be competitive and to rduce the search, BAYO would do the following strategies:•BAYO is good on providing a wide variety of products and a broad assortment of colors, and sizes that increases the chance for customers to find what they want•BAYO provide a good customer service by providing free iron and fold•Salespeople are good in providing enough informations•BAYO also allow the use of credit cards for customers buying large numbers of products

3.3.3 Evaluation of Alternatives

In the evaluation of alternatives, we are to use the multiattribute model which is based on the notion that consumers only see BAYO along with its direct competitors as a collection of attributes or cahracteristics.

Evaluatng Stores

Importance Weighs Performance Beliefs

Characteris

tics

Personal

Gratificati

on

Functional

Purposes

BAYO Kamiseta Unica Hija

Price 6 10 4 5 5

Fashion 10 7 8 7 7

Assortment 9 2 8 7 8

Quality 8 2 7 4 7Over all Evaluation

Personal Gratification 232 195 228

Functional Purposes 126 121 129*10=excellent, 1=poor

3.3.4 Choice of alternativesBased on the over all evaluation of three retailing stores competing in the

same product line using importance and performance beliefs of consumers are the following:•BAYO had the highest score, 232, for the favorable evaluation that people buy in BAYO for personal gratification purpose.•For functional purposes, Unica Hija outweigh BAYO mainly because Unica Hija provide dress that can be worn for casual as well as demi-formal gatherings.

3.3.5 Purchasing the MerchandiseBAYO already found a strategic way to make this evaluation into a purchses or sales by having the following:•Provide a complete assortment of size and color•Each salesperson have their specific job. Someone is in charged in the cashier, one is in charged to do the sales talk and someone does the astistance in the dressing area and ironing of clothes.

3.3.6 Post purchase evaluationPost purchase evaluation occurs after a certain product was purchased and

used by the customer. The evaluation may be negative or positive. Assuming that the customer achieved personal-gratification and satisfaction with the product. The retailer gained customer loyalty that will minimize the buying decision process on the next purchases. Once the customer identify a need, the customer will no longer look for alternatives but will go directly to purchasing a product on BAYO. This customer loyalty will be one important factor for the success of the retail store and soon become a competitive advantage.

3.4 Buying roles

•User-buyer-deciderThis is the one who purchase the product and use it. This

applies to consumers that seeks for self-gratification upon buying the merchandise and wants to enhance one’s self-image.

•Buyer-deciderThe one who makes the actual purchasing of the merchandise

and also the one who decide whether he/she will be buying the product. This role is applied when a consumer feel the need to have a new cloth for gathering or occasion instances.

•InfluencerIs a person who influence an individual buying decision

towards purchasing ladies apparel. Usually, this role is applicable to the consumers who have past experiences with the product and were satisfied. This role may also be acted by sales people, suggesting what merchandise will suit for the them.

IV. Retail Market IV. Retail Market StrategyStrategy

4.1Retail 4.1Retail MarketMarket

Traditional Conservative Fashion

Forward

BAYO

Unica Hija

Kamiseta

4.2 Sustainable Competitive 4.2 Sustainable Competitive AdvantageAdvantage4.2.1 Customer Loyalty4.2.1 Customer Loyalty

Establishing customer loyalty is a long-term advantage that BAYO can rely on in the future. BAYO has additional and free services for th customers that purchase their products(ex. free iron and fold). They also have website where in customers can suggest or post their reactions regarding the company and they also have product catalogues where the customers can have an idea of the latest merchandise that BAYO offers.

4.2.2 Effective committed employees4.2.2 Effective committed employees BAYO treasures their employees that results to employees loyalty. They create programs that will motivate and enhance the skills of their employees like giving sales commission incentives and other program that will benefit both the company and the employees.

4.2.3 Vendor Relations4.2.3 Vendor RelationsThe company has a supporting manufacturing firm which is

Lyncor Inc. they are the ones that do the product. The company provides their own design while the manufacturing firm does the production.

4.3 Growth Strategies4.3 Growth Strategies

4.3.1 Market Penetration4.3.1 Market PenetrationThis growth strategy is directing investments towards the

existing market segment. BAYO added merchandise to their line of products like they introduced shoes, accessories and perfumes.

4.3.2 Product Development4.3.2 Product DevelopmentIn 1992 BAYO is basically a made-to-measure shop meaning

that customers go to the shop and get measured then get what the store created. But with the growing demand, they launched their ready-to-wear line of products and further added merchandise to their line of products.

After reviewing and evaluating BAYO company’s retail management strategy, our group agreed that BAYO is competitive enough to survive the competition. It’s no wonder why BAYO still exists despite the tight competition. But they must never forget that more and more retailers engage in the same field. Meaning, the competition gets even tougher. So the best way to stay is to innovate and improve their products more. They must take into consideration that they have to intensify their advertisement and promotion that would help maintain their competence. They must always keep their products up to date with the latest trend because customers would expect more and something different.

In terms of their store design, we would suggest that they improve the ambiance and make it more appealing by adding music and decorative enhancement. Everyday low pricing attracts a lot of customers. We would suggest that they provide discounts once in a while to attract consumers that were budget conscious but tstill want to have the product.

On the totality, Bayo just have to work on some lapses so that future advantage will be on their side.

V. V. RecommendationRecommendation