Marketing Strategy of Big Bazaar India

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MARKETING STRATEGY OF BIG BAZAARINDIAPublished: 23, March 2015

In this assignment, I have described its marketing strategies and promotional activities.

The assignment is based onÂ ' the eective marketing strategy which inuencescustomer to purchase a product of Big Bazaar' helps to understand the eect ofÂmarketing strategyÂ which is responsible for attracting customer towards big bazaar.

The research was carried out as per the steps of Marketing Research. The wellsupportive objectives were set for the study. To meet the objectives primary researchwas undertaken. The data collection approach adopted was experimental research.

Big Bazaar is the fastest growing and most successful Retail chain in India. Big bazaar isthe rst retail chain to be started in India and is the largest until now. In the later part of the assignment I have applied 4P's marketing strategy to show that how Big Bazaar hasreached from introduction stage to growth stage and observed via some points that thiscompany is right now in growth stage of Product Life Cycle model. I have also analyzedthe SWOT showing how this company made its brand more eective. I have alsodescribed some suggestions to improve its brand image towards customers.

Contents

INTRODUCTION:BIG BAZAAR is a name renowned in Retail. It is now a brand image in private retailsector. Wal-Mart is the retail stores of USA and is known all over the world for its

fashionable and aordable materials and is known as one of the best in its eld, bigbazaar can be said as the Wal-Mart of India running a chain of more than 100 retailstores in India.

People around the country thinks that big bazaar is inspired from Wal-Mart and it isquite obvious to think as Wal-Mart is world leading chain of retail shopping but actuallythe idea of big bazaar came to the CEO Kishore Biyanifrom a 25 years old store"Saravana" which was owned by a family and worked on the philosophy of "low marginhigh turnover".

Following its slogan of "isse sasta or achha kahin nahi"(Meaning cannot nd cheaper andbetter than this anywhere) it provides the consumer with the best of the materials at arate less than rest of the market.

Big bazaar is the subsidiary of Future Group, Pantaloons Retail India ltd.

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The brain behind big bazaar is the CEO of Future Group Mr. Kishore Biyani

Future group is has various brands like Pantaloons, F123, Copper Chimney, Etam,Staples, One Mobile, Urbana, Brand Factory, LootMart, HomeTown and Central. Bigbazaar covers all parts of India including the metro cities Kolkata, Delhi, Chennai, andMumbai.

Big bazaar started with its rst store in Kolkata, west Bengal in 2001 and now owns morethan 100 stores all over India making itself the fastest growing retail chain in India andleaving all its competitors behind.

WHY BIG BAZAAR?Indian retail sector is witnessing one of the most hectic Marketing activities of alltimes.Â The companies are ghting to win the hearts of customer. There is always a'rst mover advantage' in an upcoming sector. This advantage goes to "BIG BAZAAR" inIndia. It has brought about many changes in the buying behavior of people as Big Bazaarprovides all items in one roof at low rates.

The consumer's preferences are changing & they are moving from shops stores toModern Retail outlet. It's the main challenge to the Modern retail outlets to attract thecustomers towards them from that of competitors. To attract more customerscompanies have to carry out the promotional activities in unique way. BIG BAZAAR hasmaintained that uniqueness & has succeeded in attracting customers.

The promotional activity of the company, which famous as Less Price than others as it

saysÂ 'Nobody Sells Cheaper and Better!'Â is made its place in minds of customer. As thecompetition is becoming sti in the market the activities conducted by the company areunique, that have brought fruitful result to the company. Among them sales Promotionsis one of the leading activity or unique among all other activities & has high inuence onthe customer walk-in.

OBJECTIVES:To know the eective marketing strategy which inuence customer to purchase a

product of Big Bazaar.To know the marketing and promotional strategy of big bazaar.

How Big Bazaar Establish and maintain its position in retailing through promotion.

LITERATURE REVIEW:

RELATED CASE STUDY:

A lot of case studies have been done before on this topic and its dierent aspects as myfocus is on leading towards success through the low cost strategy which is followed bybig bazaar, one of them is described below:


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Building brand through challenge:In 2001, PRIL opened its rst 'Big Bazaar,' a 30,000 square feet store in Kolkata. Themajor USP of the 'Big Bazaar,' store was low pricing. These stores oered the best priceproposition to customers.

As part of this, the stores focused less on branded items and more on unbranded

products with the same quality as branded ones, at a much cheaper rate. Commentingon this, Biyani said, "We are not in the business of selling ambience, but in the businessof giving the best possible deals to our consumers."...

The rst Food Bazaar was set up in Lower Parel in suburban Mumbai in 2001. FoodBazaars represent PRIL's foray into yet another value retailing business, focusing onfood and grocery products. These stores were designed based on PRIL's understandingof the emotional and rational needs of Indian housewives...

The tremendous success of the 'Pantaloons,' 'Big Bazaar' and 'Food Bazaar' retailing

formats, easily made PRIL, the #1 retailer in India by the early 2004, in terms of turnoverand retail area occupied by its outlets.

In the scal year ended June 30, 2003, PRIL increased its retail area by 66% to 586,000sq. ft and reported revenues of Rs 4.45 billion, a 56% increase over scal 2002. Its netprots rose by 63% to Rs. 114.1 million in scal 2002-03, over the previous year.

Big Bazaar has positioned itself as a 'value for money proposition for Indian family' retailstore. They wanted to promote Big Bazaar as a retail store which gives its customersmaximum advantage over other retail stores by catering to all their needs budget wise

and income level wise.

'Sabse Saste 3 Din'Â (the cheapest 3 days) brain child ofÂ Mr. Sadashiv Nayak, PresidentBig Bazaar and Rajan Malhotra, President - Strategy and Convergence, Big Bazaar,believe that 'Consumers are always looking for best value for their money. Big Bazaar'sSabse Saste 3 Din is a great opportunity for them to save money and gets best productsat the best possible prices. These three days have come to truly signify freedom fromhigh prices for consumers in the country.'

'Maha Bachat' ( save money) was introduced ve years back ( in the year 2006 ) and it isstill running very successfully. It is known as one of India's mega shopping campaign.Â

Continuing its eorts to provide the best shopping deals and savings to Indianconsumers, Big Bazaar is always set to make Republic Day and Independence Day'sshopping, truly memorable, with rock bottom prices, best possible discounts and megaoers.

Apart from the agship Big Bazaar and Food Bazaar stores, other future group retailformats like Furniture Bazaar, Electronic Bazaar, Depot, and Home Bazaar stores arealso a part of this mega campaign. From daily household needs of food and grocery toapparels,Â

RETAIL INDUSTRY IN INDIA:


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India has one of the largest numbers of retail outlets in the world. Of the 12 million retailoutlets present in the country, nearly 5 million sell food and related products. Thoughtthe market has been dominated by unorganized players, the entry of domestic andinternational organized players is set to change the scenario. Organized retail segmenthas been growing at a blistering pace, exceeding all previous estimates. According to astudy by Deloitte Haskins and Sells, organized retail has increased its share from 5 % of total retail sales Â in 2006 to 8 % in 2007. The fastest growing segments have been thewholesale cash and carry Â Â stores (150%) followed by supermarkets (100%) andhypermarkets (75-80%). Further, it estimates the organized segment to account for 25per cent ofÂ the total sales by 2011. India retail industry is the largest industry in India,with an employment of around 8% and contributing to over 10% of the country's GDP.Retail industry in India is expected to rise 25% yearly being driven by strong incomegrowth, changing life styles, and favorable demographic patterns. It is expected that by2016 modern retail industry in India will be worth US$ 175 -Â 200 billion. India retailindustry is one of the fastest growing industries with revenue expected in 2007 to

amount US$320 billion and is increasing at Â a Â rate of Â 5% Â yearly. A further increaseof 7-8% is expected in the industry of retail in India by growth in consumerism in urbanareas, rising incomes, and a steep rise in rural consumption. It has further beenpredicted that the retailing industry in India will amount to US$21.5 billion by 2010 fromthe current size of US$ 7.5 billion. Shopping in India has witnessed a revolution with thechange in the consumer buying behavior and the whole format of shopping alsoaltering. Industry of retail in India which has become modern can be seen from the factthat there are multi- stored malls, huge shopping centers, and sprawling complexeswhich oer food, shopping, and entertainment all under the same roof.

India Â Â retail Â Â industry is Â Â progressingÂ well Â Â and for Â Â this to continueretailers as Â Â well as Â Â the Â Â Indian government will have to make a combinedeort.

4P'S OF MARKETING:"Marketing" is the promotion of products, especially advertising & branding. Marketingpractice tends to be seen as a creative industry, which includes advertising, distribution

and selling.Marketing mix is a deciding factor in formulating marketing techniques for the successof a particular brand, commodity or company. The components of marketing mix are:

Product

Price

Place

Promotion

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Source:http://notesdesk.com/notes/marketing/the-marketing-mix-4-ps-of-marketing/

PRODUCT:Big Bazaar oers the maximum variety for every category of product. The product is thesame in every store in the city but the brand options are more in Big Bazaar and thequantity for each product is not limited to large packs only. The commodities sold by theretail chain includes its "own products" which get a ready distribution network. The ownproducts of Big Bazaar include My World fashion magazine which is not availableanywhere else. So costs are very low for such products.

PRICE:Price is the critical point in a competitive industry. Big Bazaar works on a low cost model.It considers its discounted price as its USP. There is an average discount of 6-8% on allitems in respect to their MRP. Prices of products are low because it is able to securestock directly from the manufacturer. There are huge synergies in terms of bulkpurchasing, transportation and central warehousing. These all factors are very helpfulfor the retailers to keep low prices.

PLACE:Place means the location of the business. Big Bazaar has always worked on cheaplocations. It targets semi-urban population with its placement. Its strategy is to nd alow-cost location and it never goes for hot spots in the city. It relied on promotionalactivities to make up for unattractive locations. Another strategy used by Big Bazaar toovercome location disadvantage is use of internet. It has launched a merchandiseretailing website www.futurebazaar.com which targets high-end customers ready to usecredit cards. The promotion of this website is done through advertisement on Google.The website is put as sponsored link.

PROMOTION:Big Bazaar has huge promotion budgets. The biggest idea behind all advertisements isto make people do bulk shopping. There are 2 types of promotional strategies of bigbazaar. One is the advertisement which promotes the brand and creates awarenesstowards people. It is not targeted at promoting each store but only creates an image of Big Bazaar as low-cost shopping option. The store has advertised through TV, roadshows and also started reality show-typed promotional campaign "The Big Bazaar

Challenge." Promotions like "Sabse Sasta Din"(Cheapest Day) are a very successfulstrategy to get good results. In this products across categories such as furniture,electronics, utensils, apparels and food products at the lowest possible prices, coupled


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with attractive promotional schemes. Some of the most attractive oers being a 20-litrebranded microwave oven with grill for Rs 2,399, jeans and trousers for Rs 199 and HCLlaptops for Rs 22,800.

Buy 2 Get 1 Free types of promotions are very common. Original prices are cut downand new prices are shown, of which customer takes quick notice. There are loyaltyschemes which reward regular clients.

CURRENT POSITIONING STRATEGY OF BIGBAZAAR:Big Bazaar is holding a strong position in the market and is growing very fast. It capturesthe maximum Indian market and with a strong nancial background and it has to go along way through.

The low price strategy it is successfully running its business all over India and is still

growing bigger and bigger. The following graph shows the Product Life Cycle of BigBazaar which is currently at the growth stage.

Source:http://www.coolavenues.com/know/mktg/ravi-big-bazaar-14.phpLooking at the product life cycle of big bazaar it can be seen that it is in the growth stage

at this point of time and still have a lot scope to grow.It is said that:

"Cheap prices are a luxury for the rich but anecessity or a need for the poor."So Big bazaar has understood the need of a vast population of the upper middle classand middle class people of the country and in fact no matter how rich a person is

wherever he/she can get good brands at a cheaper rates they will be attracted towards itwhether an average or a rich person.

RETENTION STRATEGY:Big Bazaar strive to foster a feeling of well-being in their employees through care andrespect, Big Bazaar have several structured processes including employee mentoringand grievance management programmers which are intended to facilitate a friendly andcohesive organization culture. O -site activities are encouraged to improve

interpersonal relationship. Big Bazaar also acknowledge the eorts exerted by theiremployees by organization an annual celebration called 'Pantaloon Day' where BigBazaar recognize employees who have shown exceptional talent, sincerity and


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dedication. Big Bazaar have implemented an employee suggestion programme called'Prerna' wherein the employee can give their suggestions. Every quarter the bestsuggestion received per zone per format is awarded prize called 'Golden Cap'.

BIG BAZAAR'S NEW MARKETING STRATEGY:Big Bazaar has launched new marketing strategy which is based on Guerrilla Marketing.

Guerrilla marketing warfare strategies are a type of marketing warfare strategy designedto wear-down the enemy by a long series of minor attacks, using principles of surpriseand hit-and-run tactics. Attack, retreat, hide, then do it again and again, until thecompetitor moves on to other markets. Guerrilla force is divided into small groups thatselectively attack the target at its weak points. In the world of cut throat competition,corporate use extension of the same strategy in marketing. Corporate like Pepsi, Cokeetc have been using the same for quite some time now and the latest entrant is our veryown 'Future Group'- Big Bazaar, Future Bazaar, Pantaloons, e Zone are all part of this

group and they are taking on the biggies like Shoppers Stop, Lifestyle, and Tata'sWestside. In order to do the same, Future Group have come up with 3 catchy and cheekyad campaigns which surely do catch our eyes and surely one can't resist appreciating thesame.

ADVERTISING: THE ESSENTIAL OF BRANDBUILDING PROCESS-Advertising is an essential component of brand building. The advertisement and brand

building

is done through various ways, the techniques used are:

Tag-line:Â Big Bazaar tag-lines are the key components of advertising. These tag-linesare

modied according to demographic prole of customers. These catch-phrases appearedon

hoardings and newspapers in every city where Big Bazaar was launched.

Print Ads:Â Big Bazaar newspaper advertisements are present just before launch of anynew

scheme.

TV Ads:Â Kishore Biyani spends a lot of money in brand building exercise. Big Bazaarcommercials are shown on various channels in India. Presently, Fashion at Big Bazaarcommercial is aired.

Road-side Advertisements:Â Big Bazaar bill-boards are displayed on prime locations in

various

cities as a brand building exercise. They display the catch-phrases now-a-days.

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Radio Ads:Â This technique is used in cities like Sangli (Tier 1 / Tier 2 cities).Now-a-days, itis replaced by advertisements on FM channels. This informs customers about all newhappenings at

Big Bazaar.

For example:The departmental store chain Big Bazaar has launched a commercial sometime back topromote 'The Great Exchange Oer'. The commercial portrays how customers canexchange any old and broken items (junk) and get new products at a discounted pricefrom Big Bazaar.

Customer can get the amazing prices for junk. The month of January and February isgenerally a low-key aair in terms of customer footfalls and revenue generation.Innovative, out of the box promotions is one of the eective ways to draw customerattention and shore up the revenue. Historically Exchange schemes have been used toinduce better sales; it also has a strong appeal with the Indian mindset of getting valueeven for their junk, states an ocial release from Big Bazaar.

SWOT ANALYSIS:

Â

Strengths:Maximum number of varieties: People prefer those places where they can get themaximum products they need and Big Bazaar provides vast range of products underone roof helping in attracting customer Â and Â their Â family Â to Â shop Â togetherÂ and Â enjoy Â the experience.

High brand equity: Big Bazaar has created high brand equity through its promotions andmarketing it has created a dierent image for its products as the cheap and best.

Largest chain of retail marketing in India: Big Bazaar is the rst retail chain to be started

in India and is the largest and successful until now.

High capacity investment: Big Bazaar oers 1,70,000 products and owns more than 100retail stores all over India and has the strong nancial background as being thesubsidiary of future groups which owns the pantaloons which is one of the biggest theindustries in men's wear in India and have its work is spread all over India. Future groupis one of the leading groups in India.

Everyday new promotions and schemes of low prices and discounts: Big Bazaar alwaysoers new schemes of low prices and gives discounts in products like Big Bazaar oersthe sabse saste 3 din ( the cheapest 3 days) in which it oers the lowest of prices thanother days.


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Facilities like online booking and delivery of goods: It is not just a chain of retail shoppingbut also provides online shopping facility to the consumers.

Weaknesses:

ÂOvercrowded: During oers, promotions and even on weekends the place isovercrowded with people and sometime even there is the situation of closing the storedue to it.

Checkout can be extremely slow: There can be seen a long queue on the billing countersmaking the consumer wait for hours due to the slow service and the crowd.

Perception of low price=low quality: Generally people think that if any product has lowprice then the quality of the product will be low as they think quality comes with price.

Targets at the middle class and upper middle class only: It targets at the middle andupper middle class due to which it ignores the upper and elite class people as they arethe cream of the society who are ready to pay any price for the quality and product theyneed.

Opportunities:Big Bazaar can enter into production of various products due to its in depthunderstanding of customers' tastes andÂ preferences.

Nowadays people prefer going to one big store and buy everything instead of visitingdierent places for dierent items and waste time. So Big Bazaar can expand thebusiness in smaller cities as there is a lot of opportunity.

Lot of potential inÂ the rural market.

Threats:High business risk involved: Big Bazaar investment is very large so it is obvious that

there is high business risk involved.

Lot of competitors: There are a lot of countries which are planning to enter the Indianmarket like Wal-Mart, Carrefour and Tesco which is a big threat to Big Bazaar.

Less Parking Space: Customers are not satised with the parking space availabilityprovided by Big Bazaar. Hence it's a threat of Big Bazaar as it may loose its customersbecause of less parking space availability. In holidays it will be very dicult forcustomers to park their vehicle in Big Bazaar.

Unorganized retailing: Unorganized retail stores are a threat to the business of bigbazaar as now also people prefer to go to the local stores which are convenient enoughfor them.


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COMPARITIVE ANALYSIS:

BIG BAZAAR V/S VISHAL MEGA MARTVishal Mega Mart ( FOR DETAILS REFER APPENDIX)

Fields

Big bazaar

Vishal mega mart

Price

Big Bazaar prices are very low because its adopt the low price marketing strategy.

Vishal Mega Mart prices are not low because they give whatever is market price.

Service

Big Bazaar services are not quite good as billing problem due to crowd and less parkingspace.

Vishal Mega Mart does not face these kind of problems as its not overcrowded.

Ambience

Product variety

Big Bazaar has lots of variety in every category of products. In Big Bazaar people can ndalmost everything.

Vishal Mega Mart don't have so much varieties as it is smaller than Big Bazaar.

Convenience

Big Bazaar has always worked in cheap location so that it is very convenient for thepeople to go to the Big Bazaar rather than going outer of the city.

Vishal Mega Mart also works in low cost loacation but it is not so much popular incomparison of Big Bazaar as showrooms of Vishal Mega Mart are less than Big Bazaar.

Shopping experienceIn Big Bazaar people can buy the maximum variety of products of every category underone roof helping in attracting customer Â and Â their Â family Â to Â shop Â togetherÂ and Â enjoy Â the shopping experience.

Vishal Mega Mart also provides the products under one roof but there is not so muchvarieties so that customers don't attract so they can not enjoy their shoppings

Product quality

The product quality is good in Big Bazaar because people can nd cheap and best thingsin Big Bazaar.

The product quality is also good in Vishal Mega Mart but the prices are very high.


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RECOMMENDATIONS:Big bazaar should keep oers in regular intervals so that there should not be a longterm gap, because oer is the most inuencing factor which is responsible for customerpurchase decision.

Big bazaar should start emphasizing more on internet shopping along with the formal

retail shopping because a large population of the country likes to shop online in order tosave time.

Along with the dierent discounts and oers it should pay attention towards thestudents and provide some oers for them also because half of the Indian population isof youths and students.

It should work on its billing counters and customer service in order to solve the problemof long queues and waiting customers.

CONCLUSION:Big Bazaar is undoubtedly the number one retailer in India. It has built a very emotionaland cordial relationship with its customers. It is also very intending to built long-termrelationship with all its stakeholders, which is very essential for a successful businessventure. It is observed that the organization hierarchy is professional as all thedepartmental Managers directly report to the store manager who in turn reports to theZonal Head. Big Bazaar, with 25 years of experience in the eld of weaving fabrics, is theleading Apparels and fashion design fabric company.

There exist a healthy and positive relationship between employees and managers. Theemployees accept their responsibilities wholeheartedly, accept that it is theirresponsibilities to carry out a part of the activities of the company and they will be heldaccountable for the quality of their work. It is found that more than 60% of employeesare of the age group of 20-35. FromÂ this it reveals thatÂ company is having young andenergetic workforce who are very creative, enthusiastic and also very determined togrow in their career and in turn helping the company to grow. Working environmentÂ isgood and also the various facilities provided helps in motivating the employees. The

company is Â reaching Â out Â to Â all Â the Â sections Â of Â the Â society Â as Â it Â iscreating a hypermarket where not only the rich people shop but also the middle and thelower class customers come to enjoy the whole shopping experience.

Moreover the customer friendly ambiance and the organized retailing of products alsomake Big Bazaar one of the successful retail industries in India.

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Kumar, V., 2010. Promotional Strategy of Big Bazaar & Maintaining the image inRetailing. [Online] Available at:http://www.skylinecollege.com/blog/dissertation/promotional-strategy-of-big-bazaar-maintaining-the-image-in-retailing [Accessed 19 March 2011].

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Marketing Strategy of Big Bazaar India

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Transcript of Marketing Strategy of Big Bazaar India