A Study On Customer Satisfaction in Marketing Management On V-Mart Mall

Varin Commercial Pvt. Ltd.
(V-MART)
A PROJECT REPORT ON
CUSTOMETR RELATIONSHIP MANAGEMENT AT RETAIL OUTLET OF VARIN COMMERCIAL PVT.LTD. (V-MART)
In Partial fulfillment of MBA Program

Project Guide: Prof. Palak Kanabar Submitted To: Submitted On:
Submitted By: Dhanesha Mehul R. Dadhania Nishant D.
S. K. Patel Institute Of Management & Computer Studies, Gandhinagar.
Varin Commercial Pvt. Ltd. (V-MART)
Acknowledgement
The Beginning of the act decides its future success and it is imperative that the first step of the act is taken in the right direction because these footsteps go on to set a direction for the rest to walk on and explore the enormous opportunities that lie within. Any successful venture also has its unsaid gratitude towards its direct and indirect contributes. At the out set we would like to thank our institute and our director prof. S. Chinnam Reddy for having provided us with an opportunity to carry out a project to of this magnitude that helped a satisfied our curiosity as far as our area of interest was concerned. We are also thank full to Gujarat University for giving us the opportunity to undertake a Grand project in our desired are and including it as a part of our curriculum. We wish t express our heart flat thanks to prof. Sonu Gupta and all other faculty members as well who have put in grate efforts and gave us guidance for the successful completion of the project. They have been enthusiastically involved in every aspect of our project. we are highly indebted to them for all the knowledge, guidance and motivation that they have provided to us trough out our project. We would also like to be a thank full of Mr. Hament Agrawal, Director of V-Mart, and Mr. Vikas Bheel, store manager to provide us this opportunity which help us in out project. And we are also thankful of the customer who had visited the store and had provided us help in filling up questioner. Last but not the least, we also thankful to our parent sand friends who through their selfless love where always ready to fulfill our reasonable and unreasonable demands. Mehul Dhanesha, Nishant Dadhania.
Declaration
TABLE OF CONTENT
Acknowledgement Declaration EXECUTIVE SUMMERY COMPANY PROFILE ABOUT RETAILING 1. What is Retail? 2. What is Retailing? Retail Marketing Mix. 3. RETAILING IN INDIA
RETAIL SALES MAJOR RETAIL PLAYERS HURDLES FACED BY THE RETAIL SECTOR
4. Why Study Retailing? 5. Test and Learn Retailing

6. The industry Structure Classification of Retailing
7. What drives the industry?

Porters Five Forces model:
About CRM
Introduction to CRM Eight myths of CRM Ideas about the CRM What is CRM? Advantage of CRM Difference between relationship management and CRM Some important topics 1) Find out what customer wants, first i) Model of customer driven improvement 2) Creating stack holders can matter more than the technology itself 3) Customer is the king 4) The demand for loyalty marketing Core CRM development roles Research Methodology - Objective - Methods of Data Collection - Sample Design - Data Analysis Findings
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Suggestions and Recommendations Limitations Annexure Bibliography
EXECUTIVE SUMMERY
Relationship is the basic funda on which each and every transaction is done. All the transactions are based on it weather there is a relationship of father son, husband wife, buyer seller, employer employee etc. Some short of relationship is there. In todays fast changing and dynamic world every companies are more concentrating on the relationship management with there customers. So as to increase their satisfaction and also to maintain it at a desirable level it is also useful in retaining customer for life time. Today we have retail industry as a growing child in the India and world as a large. It works as a bridge between manufacture to the final customer. From the view point of product life cycle we can say that retailing is some where around between the growth and maturity stage. In this report our study is totally based on organized retailing which covers shopping mall, super markets, chain stores and etc. From the figure point of view retail industry is growing by 5% every year. As far as India is concern the tradition of Indian people is not to purchase goods in bulk at a time but they prefer to purchase as and when required in a very small number that means retail purchase. So we can say that retailing is suit to the Indian culture and mentality of people. We can take advantage by combining the above two points to delighting the customers which suggest our project title CRM at retail outlet. In our survey we have covered Ahmedabads law gardens store for our sample point and we had covered 240 customers as sample for our survey. During our survey, at the time of filling up the questionnaire and face to face interview with customer and at the time of analysis we have tried to reach at maximum point at we can reach though we have certain limitations. We have discovered some findings, suggestions, recommendation for the benefit of varin commercial Pvt. Ltd. (V-MART) to retain the customer and also to provide them opportunities to increase their satisfaction level. The various part of report covers data about retailing, CRM, company profile, research methodology, finding, suggestions and recommendation, and limitation
COMPANY PROFILE
A company named varin commercial Pvt. Ltd. Was started on oct-2002 at new delhi by two person Mr. lalit Agrawal and Mr. Hemant Agrawal they both are the director of the company. Head office od this company is situated at new-delhi. At present in delhi they have three stores which as follows H.O.: Mayapuri Industrial Area, Gate No. 1, Phase-II, New Delhi-64. Show Rooms: Bunglow road, Kamla Nagar, New Delhi. Lajpat Nagar, New Delhi. Pitum Pura, New Delhi. Total handling is done by Delhi based office. They had started with only one show room at Delhi and by the passing of time they where thinking of expansion and had established a show-room at Ahmedabad that is in Gujarat on 5th oct. 2003 with the store name of VMART at Broadway business centre, Law garden corner, Ahmedabad-Gujarat. The Handling of this region was taken care by Mr. Hament Agrawal. During very short span of time they had started a new show room in Ahmedabad itself on 25th dec. 2003. at Fun-Republic, Sarkhej Gandhinagar Highway, Nr. ISCON temple, Ahmedabad. Recently they had also started one new show room at Rajkot In saurastra in collaboration with Adani B2C India Limited on 28th Feb. The management hierarchy followed by this company is as follows
The Director Manager Floor In charge Cashier Staff-Member For the time period from Oct 2002 to as on today they had touch the turn over near about 12-15 Cr. And had open five new branches. It is a big achievement isnt it. The purchasing system is totally centralized from Delhi and they are also purchasing locally to fulfill the local requirement as per the region. The vision of this is to reach at each state by opening atleast one outlet of V-MART. They mention in their future plan is to follow their slogan SABSE SASTA SABSE ACHHA and also to satisfy their customer with high level of customer delight. In store there is a bar coding system is applicable to each and every item. They have computerized system for maintaining their inventory. They are having two system for maintaining their accountings. Gini System Tally So by the way they have totally six outlets which are Three at Delhi Two at Ahmedabad One at Rajkot In near future, they are planning to open their outlets again in Gujarat Region at Baroda and Surat.
ABOUT RETAILING
1. What is Retail?
The word retail is, in fact, derived from the French word RETAILER, which means to cut off a piece or break bulk. A retailer may be defined as a dealer or trader who sells goods in small quantities or one who repeats or relates. Retailing can hence, be considered as the last stage in the movement of goods and or services to the consumers. put simply, any firm that sells products to the final consumer is performing the function of retailing .it thus consists of all the activities involved in the marketing of goods and services directly to the consumers, for their personal, family or household use. The past century has been witness to many changes occurring in our everyday world. Industrial and technological growth has made a significant impact on our lives as consumers. One such industry, which has made a phenomenal impact on our daily lives, is retail. This industry touches our lives as end consumers, by providing us with the products or services that we need. Almost everything we use in our daily lives including the feed we eat, the clothes we wear, and the things we need for our homes or for ourselves, are bought from retail stores. Goods are manufactured all over the world but are ultimately sold to us through these retail stores. India has already proven its mettle as superpower in the arena of information technology. The retail industry offers to bloom to the same level if conductive environment and support is provided it. Indias one billion populations make the country the second largest in the world in terms of population which is the very basis for successful organized retailing. We should take heart from the fact that most of the worlds successful retail stories in the developed as well as developing countries have shaped up in small towns and villages. Retailing is a green pasture not just for individuals or companies but also comes with job opportunities in all aspects of the operations. Professionalisms in retail while still in its infancy does show some promising future for those keen to make a career in this fascinating world.
2. What is Retailing? Retailing consists of those business activities, which are involved, in the sale of goods or services to consumers for their personal, family or household use. It is the final stage in the distribution process for good and services
from manufacturers to final consumers.
Typical Distribution chain

Source: - Retail Management By: - Ron Hasty, James Reardon. Retailing involves - Interpreting needs of the consumers - Developing good assortments of merchandise - Presenting them in an effective manner so that consumer find it easy and attractive to buy. Retailing differs from marketing in the sense that refers to only those activities, which are related to marketing goods and/or services to final consumers for personal, family or household use. Whereas marketing , according to American Marketing Association, refers to the process of planning and executing the conception, pricing, promotion and distribution of ideas, goods and services to create exchanges that satisfy individual and organizational objectives.
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Organizational buyers purchase in order to perform a task or sell a product effectively, efficiently and at a profit. They could be industrial buyers or intermediary buyers. Industrial buyers are those who purchase good and services to be used in or to aid manufacturing process. Intermediary buyers atr include street vendors, local supermarkets, department stores, restaurants, hotels, barbershops, airline and every bike and car showrooms. Still retailing may or may not involve the use of a physical location. Mail and telephone orders, direct selling to consumers in their homes and offices and vending machines all fall within the purview of retailing. In addition to it , retailing may or may not involve a retailer. Manufacturers, importers, non-profit firms and wholesalers are acting as retailers when they sell goods and/or services to final consumers. Whatever the form of retailing, a retail marketing strategy defines the execution of the marketing process and facilitation of customer satisfaction. This retail marketing strategy involves selecting a retail target market (i.e. the carefully/exactly identified group of final consumer that a retailer sees to satisfy) and then implementing the corresponding retail marketing mix (i.e. a combination of product, price, promotion and distribution strategies that will satisfy the retail target market). The table depicts consumer service as the crux of the whole activity.
Retail Marketing Mix.

Product Branding Packaging Product Design Assortment Services Price Cost of Goods Business Expenses Gross Margin Profit Distribution Logistics Store Location Site Evaluation Transportation Storage of Goods
Promotion Advertising Personal Selling Sales Promotion Public Relation Visual Merchandising Source: - Retail Management
By: - Ron Hasty, James Reardon.
The implementation of such a retail strategy mix benefits consumer and producers and yields economic utility. The same has been explained in detail in Annexure-1.
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3. RETAILING IN INDIA
RETAIL SALES The retail market in India is estimated to be worth around USD 180 billion. It is Indias largest source of employment in the country after agriculture, employing more than 20 million people. The retail industry in India is largely unorganized with small and individually owned businesses accounting for more than 98% of total retail sales. There are nearly 12 million retail outlets in India, with a majority of them located in rural areas. Though India has one of the highest numbers of retail outlets as a percentage of population in the world, the retail space at 2 sq .ft per capita is amongst the lowest. There has been a growing shift towards organized retailing in India in recent years. At present, organized retail in India is estimated to be 2% of the total retail sales. Experts have predicted high growth in organized retailing and some have projected organized retail to grow by 30% until 2005. Recent years have seen the entry of several new players in the retail industry; chains such as Westside, Shoppers Stop, Foodworld, Crossroads, Wills Lifestyle and Lifestyle have been establishing themselves in the retail market. In addition several of the existing players such as Nilgiris and Subhiksha, have been focusing on expanding their operations. With per capita incomes rising and disposable income rising too, retail industry is likely to witness high growth. Established retail brands, due to their image of consistent quality and service, may be the most from these trends. MAJOR RETAIL PLAYERS Retailing in India is still evolving and the key players are working with newer formats in an attempt to grow at a fast rate. The table lists some of the important retailers in India at the present time:
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Sl. no 1
Compan y name Margin Free Markets
Group name
Format
No. Total of sq.ft. stores 300
2002 -03 Sales(INR Millions)
Future plans Plan to open huge margin free hyper markets(50,00 0 sq.ft.each in Ernakulam, Thiruvanathpu ram and Kozhikode). Plan to open 30 new outlets
Indepen Discount dent grocery Retailer chain
360,000 5,400
Nilgiris
Bangalore based Nilgiris group RPG Group (51%) and Dairy Farm Intl. (49%) K Raheja GroupReal Estate
Food supermarket
30
89,000
2,300
Food World
Food supermar ket
90
262,000
Plan to open14 more stores this financial year
Shoppers Stop
Departme 13 nt Store
475,000 3,030
4 more stores by the end of 2003
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Sl. no 6
Company name Subhiksha
Group name
Format
Indepen Discount dent grocery Retailer chain
No. of stores 143
Total sq.ft. 192,000
2002 -03 Sales(INR Millions)
Future plans Expand in Karnataka, Maharashtra, Gujarat and Andhra Pradesh
Westside
TATA Own s brand TRENT apparel stores Pantalo on Retail Hyperma rket
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217,000
1,200
20 departmental stores by 2004 2 more stores by the end of the 2003 8 Giant RPG Group Hypermarket (sells both retail and trade) 1 50,000 8 stores in 3 years. All 50,000 sq. ft. each
Big Bazaar
100,000
1,500
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Crossword
Shoppe Book rs Stop Retailer 51%; ICICI Venture s 49%
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60,000
230
Open 25-30 new stores across 7 cities by 2004. An investment of 1,200,000 rupees per store will be made. The stores will be between 300-600 sq. ft.each.
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Globus
11 12 13
Wills Lifestyle Landmark Lifestyle
R Own Raheja brand Group store - Real Estate ITC Specialty Store
110,000
100 4 75,000 225,000 1,350 Open shops in Bangalore Plan to open 2 new stores - both in Mumbai. 8 stores in 3 years. All 50,000 sq. ft. each
Departme 6 nt Store
14
Giant
RPG Group
Hyperma rket (sells both retail and trade)
50,000
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The trend of large corporate groups entering the organized retail sector - looking for new business opportunities continues. Groups such as ITC, RPG, Tatas which entered the organized retail sector are expanding their operations in the country. Most of the players in organized retailing are in the initial stages of their business and expansion plans. Accordingly, most are not profitable businesses at the present time. Pantaloon and Westside (Trent) are listed on the capital markets and have shown net profitable in the last year. Most other players are hoping to break even and start making money only in the coming years. The presence of multinational retailers is still an exception with Dairy Farm, Marks & Spencer, already on the market. Metro is expected to set up operations by the end of the year. Hurdles faced by the Retail Sector The Indian Government is in the process of formulating a strategy to nurture and support the retail sector. Due to this, retailing in India is largely unorganized and fragmented. Lack of FDI (Foreign Direct Investment) is another reason why it remains so traditional. Policy makers continue to put barriers for the entry of foreign enterprises due into this sector. But the last decade has witnessed significant movements towards modern retailing, especially in the consumer durable products segment. Products, marketed on lifestyle platforms, experienced a dearth of appropriate retail outlets, which could fit their brand positioning. As a result, many brands began to set up their own retail outlets initially, thereafter expanding their modern retail network through franchise arrangements. In contrast, the grocery segment has been slow to take to modern retail. The grocery sector in India is estimated to be USD 90 billion. The organized retailing in this segment is still in its nascent stage and needs to develop in terms of its scale and share in the market, margins earned, labour productivity, and economic propositions like distinctive sourcing, development of private labels, technology, etc. But there are some modern retailing formats in grocery that have emerged and are catching on with the increasing number of nuclear households in urban India, where both husband and wife may be working out of home or traveling.
A large number of retail outlets in India still remain family owned. They offer limited Products and finance facilities. Banks are hesitant to provide these retail sector units with finance facilities due to their small size which is non viable for the banks. The supermarket format in India faces the difficulty of obtaining licenses, customer inhibition and the lack of suitable personnel.
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But organized retailing is likely to emerge in other categories like appliances, IT products and others. This kind of progress will depend largely on real estate, prices, supply chain bottlenecks and sourcing. Emerging Channel Conflicts The relationship between manufacturers, wholesalers, middlemen and retailers need to improve so that business practices are smooth and stock outs in India become uncommon. In the grocery sector, for example, there are still no direct transactions between major owners and large retail chains-with local suppliers still being routed through the companys distributors. Direct interaction through intermediation of the distributor could lead to conflicts for the larger part of the business of brand owners. However, with recent changes and growth in the retail segment, the supply chain relationship is also likely to undergo several changes in future years. Brand Competition The Indian urban consumer is quite aware of international trends and most consumers are very value-conscious. Indian retailers need to be extremely efficient in their operations and design, as the value-conscious Indian consumers will not pay more for a superior shopping experience. What this means for international brands is that they need to clearly offer contemporary designs and provide value to the Indian consumer even if this means adapting their international designs to suit local conditions. With the advent of global competition in the retail sector, domestic companies will have to learn to keep up with the trends of the market or face the consequences of shutting down. But consumers have benefited from this competition as it provides them with a larger variety of choices and a better standard of living. Franchising Development Transnational retail giants have opened up stores in India through franchise arrangements with Indian promoters. Marks and Spencers have recently opened its store in New Delhi and Mumbai through the licensee route. Human resource Big retails shops do not confirm their target segment for employees to under graduates. Shoppers stop broke the myth of MBAs not waiting to go into the retailing carrier. Cross road s and spinier also higher MBAs to manage their changes. However there still exists agape between the supply and demand of professionals. Mr. Goneka, chairman RPG Gropes, hopes that one of the greatest challenges facing modern retailing in India is the availability of the trained personnel. In order too address to problem RPG Group has setup a national institute in Chennai, which offers a variety of courses in retail management for front line, supervisory and managerial post.
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Retailing the human resource is also a major challenge for these big retailers. The bigwigs like cross roads offer high compensation and create a cohesive environment that makes an employee prouder to part of such big retail chains. Space and infrastructure To establish a retail shop the real estate and the infrastructure are very vital. The expenditure and availability on both the account do hinder the growth of the retail chain. The land calling restriction and other state restriction on land use have prevented the growth of efficient retailing in the cities. An average investment of about Rs. 5 Cr. is required to establish a mall and that explains the rush of big companies in to this business. Small and individual retailers find it difficult to pour in that much of investment. In addition to the initial investment, to combat e-tailing, expenditure has to be incurred on technological side. This makes the retail project less attractive for the individual players. Consumer mind set towards discount stores In India the concept of discount store like wall-mart, at which genuine, defect free international brands are available at 50% discount, is yet to catch on. Still, the major sections of consumer are conservative and choosy and prefer to go to a non retail shop then opt for a discount store. Very few discount stores like SM2, Mumbai are at present operational. If research is confine to major cities. Braking the conventional mind set of the Indian consumer that discount stores do not sell inferior goods will take some time. Rural Market how to penetrate? Penetration in to the rural market is what big retailers have to concentrate on for growth. Attracting rural market will be different from that of the urban market. For example detergent cakes are preferred to powder and coconut oil in bottle to sachets in the rural areas. the rural consumer are different from the urban consumer as they are more price sensitive and their quantity of consumption would be less as their share of wallet for shopping alone with entertainment is delineated. Food ad agriculture in foods dominated the rural consumers in the rural are not urbanites without money. he has a distinct identity and value system. One more challenge in rural market is that shopping habits vary according to seasons. During harvest time, the spending of rural consumer increases compares to other times. However, penetrations of television, increasing literacy level, mobility between rural and urban are telecommunication (STD service) has increased their awareness toward branded products and entertainment. Customize retail shops would be big success in the rural are too if right strategies are adopted.
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4. Why Study Retailing?

So far, it has been seen that retailing is a vital and involuntary action performed by the living structure of the market economy (as opposed to the case in a barter economy). In a barter economy, barter transactions take place between consumers themselves. Consumers interact directly whereas in a centralized market economy, transactions taking place at a larger scale (both in terms of volume and variety) necessitate an interface between the manufacturers and industry is extant as an interface between production and consumption, from times immemorial, benefiting us consumers or producers in the various ways discussed above. Our study concentrates on organized retailing, which consists of shopping malls, super markets, chain stores, and like. In the last few years a shift has occurred in India from individual retail outlets owned separately and managed distinctively to professionally managed retailing. This is an industry, which has now started attracting batter investments and talent. Things primarily because of the rising expectations of consumers and the corporate responding quickly. Today, the industry (in India) seems to be functioning somewhere between the accelerated development and maturity stages, with high growth rates, intense competition and moderate profitability. For reference, the table, depicting the various stages of the Retail Life Cycle is given in annexure 6 In order to get an idea of the magnitude of the issue we are dealing with, we look at the international scenario. During 1992, the largest 100 retailers in the world generated over $1.1 trillion in revenues. Retailing is the second largest industry in the world, one of the largest employer of the world and an index of economic growth. In India there are about 5 million retail outlets varying in sizes and nomenclatures. India has the highest number of retail outlets per capita in the world but has the lowest retail space per capita in the world (2 ft / person). Out of these five million outlets 96% are smaller than 500 sq. ft. in area. There are about 3 million outlets in Indias 3700 designated towns and more than 6, 00,000 villages. About 350 million people live within one minute walk of these retail shops. According to retail census conducted by market researcher ORG-MARG, Rs. 4, 79,568 Cr. worth of products where sold through these 5 million retail outlets. Manufacturer owned and retail chain stores are springing up in urban areas to market consumer goods to the middle class in a much similar style as malls around the globe. At present about 8% of the Asian population is employed in the retailing industries as against 20 % in USA. As India moves towards the service oriented economy, a rise in this percentage is expected. The number of the retail outlets is growing at about 8.5% annually in the urban areas and in towns with population between 1, 00,000 to 1 million; the growth rate is about 4.5%.
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According to Kurt salmon Association, a global management consulting firm, organized retailing seems all set to power ahead from Rs. 5000 Cr. currently to about Rs.30,000 Cr. in next five years. In India, organized retailing is catching up fast. Yet retailing is to be recognized as fullfledged industry in the India. Organization retailing is bound to grow tremendously provided the marketing strategies are adopted. Even though the big retail chain are concentrating on the upper segment and selling products at higher prices like Crossroads, Shoppers Stop, retail stores are sprouting that cater to the needs of the middle class. With a huge middle class population, the retailers like RPGs Foods world are tapping this customers are in a dilemma as to pick which one! The organized retail chains display all the products and the most attractive product catches number of products of similar quality hitting the market. Differentiation plays the lead role. According to Mr. Simon Bell of A. T. Keearney, there is a close relation between the growth of brands and the growth of the organized retailing. Companies selling branded products prefer to have big differentiated from unbranded products he opines. India is going through that phase in retailing, which the US experienced in 80s and early 90s. From product based shopping, the importance has shifted to experience based shopping. The customers of the 21st century would expect to pick his/her own products around an array of choice rather than asking the local kiranawallas to deliver a list of monthly groceries. Thus the way of distribution of products has gained importance in the past decade.
5. Test and Learn Retailing:

Retailers are using the scientific method to test new business models and create sustainable competitive advantage. Integrated Solutions for Retailers, January 2005 Written by Jim Manzi, Applied Predictive Technologies: All good retailers experiment. Whether guided by management intuition or more formalized tests, shopkeepers have experimented throughout the ages. There is nothing novel about it. What is new, however, is the availability and sophistication of information technology that has enabled large retailers to make the experimentation process more rigorous and systematic. Formal experimentation in the store network, often dubbed test and learn, was first pioneered by very large ($5 billion to $10 billion+) retailers. As the power of this approach has been confirmed by experience, it has become widespread among successful multibillion dollar retailers. Leading test and learn retailers span virtually all retail segments, and include Wal-Mart, Staples, The Limited, Starbucks, and others.
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What Is Test and Learn? Test and learn starts with the premise that any business idea is a hypothesis that can be tested and value-engineered before it is implemented throughout the entire network. Whether by conducting planned tests or observing natural experiments, a test and learn capability identifies management actions that are most successful in improving performance, evaluates their impact, and helps executives make better, more accurate decisions about how or whether to move forward with new concepts. Test and learn has been demonstrated to work for virtually any enterprise with about 100 physical locations that sell goods or services to consumers. Test and learn retailers apply this methodology to decisions spanning marketing (e.g. media advertising, in-store visual merchandising, promotions), operations (e.g. sales associate training programs, operating hours, labor loadings), and capital investments (e.g. store remodels, "store-of-the-future" programs, in-store technology rollouts). At any given time, test and learn retailers are testing dozens of such initiatives across their store networks. These retailers are able to reliably, consistently, and economically answer three questions about any tested store program before rollout:

What average impact will the program have on key performance indicators if executed across the network? Will the program have a larger impact on some locations than others? What is the relative impact of each major component of the program?
A Sustainable Competitive Advantage Test and learn has become a strategic capability for retailers for three reasons. First, it has driven identifiable incremental profits of tens of millions of dollars per year to retailers as they have institutionalized the capability throughout the enterprise. This allows the retail organization to attract more capital as its overall capital productivity rises and also to invest the new capital more effectively, establishing a cycle of profitable growth. Second, unlike many retail innovations that are on immediate display to competitors, this capability is very hard to identify and copy -- even the results of the capability in the form of targeted and segmented implementation of programs by location are often misinterpreted or misunderstood by competitors. Third, constant testing of ideas with real consumers creates a reality check that helps to prevent the consumer value proposition of the retail brand from drifting away from evolving consumer tastes. Fully implementing the business process, organizational, analytical technology, and data components of a best practice test and learn capability may seem daunting, but it has been successfully accomplished by many large retailers and is currently a source of competitive advantage and substantial net profit improvement for these companies.
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6. The industry Structure:

Classification of Retailing Retailing is not bound or restricted by product categories, any consumer products manufactured by a company can be retailed and available in the market can be retailed ranging from food to books to toys etc Entire retailing market in India can be divided into traditional retail stores and modern retail stores. While traditional retail stores form the unorganized segment of the market modern stores are part of organized sector. Organized retail market can be further categorized in four different ways: Based On Form of Ownership Based on the form of ownership, various types of retailers comprising the retailing industry are described below: An Unaffiliated or Independent The retailer is one who owns and operates only one retail outlet. A family mostly owns it with high dependence on the owner, thus affecting long run success and employee morale. He is supposed to have a friendly personalized image and his offering reflects his own tastes and preferences and to some extent those of his regular customers. Kirana shops are very good examples of such retailers. A Chain retailer or Corporate A chain retailer or corporate retail chain owns and operates multiple retail outlets (store units) under common ownership. Most chains have well defined management philosophies, which tend to be solid overall strategies. Consistent strategies with reference to store hours, product assortment, prices, sales personal, promotion and other policies must be maintained throughout all branches in order to project a particular image of the chain. This calls for centralized decision making which in turn result in difficulties for individual units in adapting to local needs of the target markets. There also exist associations of independent retailers, which are formed in order to compete more effectively with corporate chain stores. They enjoy the benefits of corporate chain while still maintaining status of individual owners. These associations could be formed with other retailers (known as co-operative chains), with sponsorship by a wholesaler (know as voluntary chains) rather than by the retailer themselves or by franchise agreements sponsored by manufacturers or distributors (known as dealers) or by service firms (known as franchisees).
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A Franchise System A franchise system results from contractual agreement between a franchiser and a retail franchisee thus allowing the franchisee to conduct a given form of business under an established name as per a particular business format in return for an initial fee and a percentage of monthly gross sales as royalty. It helps franchise to create national or international presence quickly and with lower investments (than required by the franchiser alone for creating such a presence independently). Moreover, franchisees, that are owners and not employees, have a greater incentive to work hard than the owners (or caretakers) of retail units in other forms of retail chain. Also to their advantage, they obtain SOPs and management skill from the franchise. Further, they have support from co-representative to spot and solve any problems. To maintain the brand image, uniformity has to be maintained throughout the franchisee network. So the franchisees have to meet some specified provisions of franchise agreements. These, if not met, give the right to the franchise to avoid the individual franchisee. It is for this reason that franchisees are seeking more and more independence from franchise rules and regulations. A Leased Department (LD) A Leased Department (LD) is a department in a retail store that is rented to an outside party. If the existing store is well known, with a large number of steady customers, it becomes easier for the LD to generate immediate sales. It operates in categories on the fringe of the store's major product lines and it must be taken care that it is not a parasite and does not live off the traffic generated by other parts of the store. Thus goods or services lines that it can offer may be restricted. Apart from this, various requirements are imposed to ensure overall consistency and coordination. Vertical Marketing System (VMS) Vertical Marketing System (VMS) comprises all the levels of business along a channel of distribution. In an independent VMS, there are three levels of independently owned businesses manufacturers, wholesalers and retailers. Such a system is most beneficial if manufacturers and/or retailers are small, intensive distribution is sought and customers are widely distributed. In a partially integrated VMS, two independently owned businesses (most likely a manufacturer and retailer) along a channel perform all production and distribution functions without the aid of the third party i.e., wholesaler. This type of system is most appropriate if manufacturers and/or retailers are large, selective or exclusive distribution is sought and existing wholesalers are too expensive or unavailable.
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Through a fully integrated VMS, a single firm performs all production and distribution functions without the aid of any other firm. A fully integrated VMS enables a firm to have total control over its strategy, to have direct contact with final consumers, to have higher retail markups without raising prices (by eliminating channel members), to be selfsufficient and not rely on others and to have exclusivity over the goods and services offered. Consumer Co-operatives Consumer Co-operatives are retail firms owned by their respective customer members. In such cooperative arrangements, groups of consumers invest in the cooperative, receive stock certificates, elect officers, manage operations and share the profits or savings that accrue. Consumer Cooperatives come into existence with the purpose (of some consumers) of operating stores as well or better than traditional retailers, of getting control over prices, of saving money by substituting their own labor or of getting access to healthful, environmentally safe plots, not available from traditional stores. Based On Location, Target Market, Price, Offerings & Customer Services & Competitors Challenges There are several types of retailers whom we can divide based on location, target market, price, offerings, and customer services and competitors challenges. The variety store It contains a wide variety and sells a wide assortment in inexpensive and popularly priced goods and services. Neither they are departmental stores nor they carry full product lines. This type mainly focuses on middle and lower class niche markets and the location can be a shopping center or an isolated store. Here the prices are average prices and the quality is below average and average. There is a wide range of offerings but customer service is limited. These types of stores face a stiff competition from specialty stores and discounters. Examples could be Food World and the Trinetra supermarket chain. The specialty store It concentrates on selling one goods or service line. That is the location may be a business district, or shopping center. Concentrates on selective market segments with very narrow width, extensive depth, and average to good quality. Generally the prices are fixed at above average. The offerings are like apparel and accessories, toys, furniture etc. Extensive sales force, knowledgeable sales personnel, good customer service policies are the main assets of these stores. Competition will be determined according to the depth of assortment and size of the store. Examples could be Walden and Odyssey at Hyderabad.
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The retail catalog showroom It helps consumers select merchandise from catalogue and shop in a warehouse-style setting. It is located at shopping center or isolated store. And the targeted group is middle and lower middle class. Maintains average to good quality goods, with competitive prices. The offerings are electronics, house wares, gifts and watches. Here they try to avoid clothing and other high fashion items. These are mostly self-service based and face a difficult time reacting to both price rises by suppliers and price cuts by competitors because catalogs have to be printed in advance in order to carry out business. Examples here could be tiles shops, sanitary ware stores etc. Off-Price chain stores They are set up at business district, suburban shopping strip or can be an isolated store. The targeted group is price conscious customers. The assortment is with moderate width but poor depth; and average to good quality goods with low continuity prices. The offerings are apparel and accessories, footwear, linen, fabrics, cosmetic, house wares. They maintain limited sales force, no gift-wrapping, and extra charge for alterations. The challenges are from other institutions formats due to discontinuity of merchandise and insufficient customer service for some upscale shoppers. Examples here could be stores in towns and city suburb stores. Factory outlets They are mainly manufacturer-owned and sell the manufacturer's closeouts, discontinued merchandise, cancelled orders or in-season, first-quality merchandise. The location is out-of-the way site or discount mail. Choosy and price conscious customers are the target group. This has moderate width, poor depth, and a low continuity. The prices are also very low. Any factory or firm items will come under this category based on self-service. Competitors are specialty and department stores. These stores face challenges mainly from the manufacturer's key customers. Examples here could be Lee, Levis and other branded garment manufacturer's factory outlets. A Flea market It has many retail vendors offering a range of products at discount prices in plain surroundings. The location is an isolated site, racetrack, arena, parking lot, and stadiums. The customers are lower class and the assortment is extensive width, poor depth, variable quality, low continuity, with very low prices because the target group is low class. The products are antiques, knick-knacks, used merchandise, new clothing, cosmetics, watches, consumer electronics, hardware and gift items, self-service oriented and hardly any competitors or challenges
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The Membership club It is a club of consumers, which straddles the line between wholesaling and retailing. It is an isolated store or is located in secondary sites like industrial parks. The targeted groups are price conscious consumers who are the members of the club. This is with moderate width, poor depth and low continuity with low prices. The offerings are general merchandise (appliances, consumer electronics house wares, apparels), food and sundries (health and beauty aides, tobacco, liquor and candy). They manage with limited sales force. The challenges are the limited size of final consumer market segment. It is difficult to allocate efforts between business and final consumer accounts.
7. What drives the industry?

The actual composition (the distribution of the types of retail store) of the retailing industry in a particular geographic area is determined by following factors; I. Demographic trend: Demographic trends involving population size, the number of house hold, population mobility, its location and income dominate a retailers strategic planning for the future, hence qualifying him for a particular category from the once describe above. These factors have been elaborated upon in annexure 2. II. Lifestyle trends: Lifestyles represent the way in which individual consumers; families or house holds live and spend time and money the lifestyles trends, in correlation with demographic trends, do have a grate impact on the structure of the retailing industry. The trends regarding some factors must be understood and adapted to by the retailers. Porters Five Forces model: As yet, we have been analyzing the retailing industry in the context of the macroenvironment - consisting of Political laws, Economic regulations, Social customs and Technical standards, in the land of a particular retailer.Now we move on to the analysis of the industry in the contest of competition prevalent within the players of the industry. This addresses the need to identify those factors in the environment, which influence the capability of a firm to achieve a competitive advantage and to position itself to such advantage. Players at different levels of scale of operations have to confront different levels of competition posed collectively by the five forces- threats of new entrants, rivalry amongst the existing firms, and pressure from the substitutes and the bargaining power of buyers and suppliers. Different forces take on prominence in shaping the competition at and also across different levels.
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1. Threat Of Entry To an industry depends on the extent to which there are barriers to entry, which most typically, are one or more of the following six: 1. Economies of scale are not such a big issue in the retiling industry. The scale of operation might be small for a firm to begin with and it can, in its initial stages, focus on a specific target segment whose needs can be addressed by that scale of operations. But these surely gain importance once expensive technological advancements (which may be beyond the reach of small retailers) come into picture. 2. For instance, it may be difficult for the small firms (or retail outlets or chains) to use fully automated inventory systems or toll-free 800 numbers or in-store video networks or other interactive applications. As a result, they might lose out on the grounds of efficiency, in competition with their larger competitors. So they must adapt by concentrating on providing more personalized services to the target segment seeking it. Hence this factor is mainly responsible for triggering competition between large and small retailers. 3. Capital requirements again depend on the scale of operations. Franchisers have an edge over the corporate retail chains in this regard as they are able to form national / international networks without high investment of their own. 4. Cost advantages independent of size (scale) arise due to the experience gained by early entrants and the relationship they have established over time with their suppliers, manufacturers and customers. These might also pose difficulties in handling market and operational problems. This is why absolutely new local entrant face severe competition from the large retail chains operating worldwide who might want to plunder their regions, with the expertise that they have gained as a result of years of experience. On the top of it, with the help of lucrative offers, they tie-up with the existing local players who know the area well. Such an example is Spencer's tying up with RPG to open Food World Dairy International. 5. Expected Retaliation from the existing firms (at large scales) is rising over time or due to recent trend of foreign collaborations, they now have the financial muscle to combat any sort of competition relating to price or promotion. For small and local retailers, this is not such a big issue. Legislation regarding location, prices, number of employees etc. affects the operations or even establishments of a new entrant - at large as well as at small scales. Today legislation has contributed towards increasing competition tremendously by allowing entry of foreign players, independently or as a joint venture with the local players. But it works towards keeping a check on entry by implementation of FIPB regulations.
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6. Differentiation: postulates that new entrants might have to spend heavily to overcome existing customer loyalties, which established firms are enjoying due to past advertisement and customer service or simply due to early entry into the market. To attract its target segment, a retailer will have to project some benefit(s) that he/she is offering over and above the offerings of the existing players. 2. Intensity Of Rivalry Among Existing Competitors is High In case of tangible products in retailing industry as the existing feature in the consumer market is brand loyalty (i.e. loyalty to a manufacturer's product) rather than store loyalty. Consumers look for a particular brand which they have used/ consumed/ heard about, which might be available with a number of different types of retailers- big and small. Today big supermarkets or malls with specialized retailers do pose a threat to the neighborhood retail stores, which are now used for fulfillment of immediate and small needs only. On the other hand, large professional retailers face competition from more personalized retailers who might be more comfortable with offering facilities like credit on purchases, return and exchange offers, specialized, hard to get and better quality items and extended business hours in order to retain whatever customer base they have and not let it be lured away by competitors. They just have to niche around big retail stores and malls by improving customer service, tailoring selection to customer needs and not competing directly with their product lines. Big retailers cannot match small ones on value. They live on hype and not reality. E.g. Big retail stores (chains) like Wal-Mart create illusion that they always undersell the market, based on a handful of heavily promoted items at rock bottom prices, but the rest of their inventory is not as price competitive. According to the research published in Business World - May 1999, few large retailers do have large turnovers- 35.2% of the total retail turnover. But that still leaves a bulk of the market in the hands of the medium and small retailers. Mr. R Gopalkrishnan of Tata Sons has opined that- "In India, smaller retailers continue to grow contradictory to the normal economic development where small retailers decline in numbers with their emergence of the large players." Experts feel that the size of population and the high unemployment rate have contributed to their growth of small retailers. With so many looking for work, setting up a small outlet is relatively a simple Things to do. Lastly, high (10%) industry growth has turned competition into a market share game. 3. Pressure from Substitutes Emerges Mainly From Two Factors 1. Switching costs for customers to the substitute. 2. Buyer willingness to search out for substitutes. Also the threat of substitution may take four different forms, each of which we shall now Discuss with reference to above factors.
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Product-for-product substitution The growing popularity of traditional non-store retailing base of catalog mail orders, direct mailers, telephone sales, door-to-door selling, supplemented by recent innovations like vending machines, in-home video tape infomercials, on-line CD ROM systems, teleshopping and net shopping poses a threat to store retailers. These media do provide the customers with ease of shopping, some entertainment and even more information about range of products. But still there are reasons (as per data in table 3 in Annexure 3) due to which these media are not catching on quickly (as per data in table 4 in Annexure 3) especially in India. E-tailing transactions are less than a quarter of a percent of the total retail business in India 8. Even in western countries, it accounted only for 20% of the total retail spending. In the US, store based retailers, altered by analyst's predictions that online retail could account for as much as 10% of the total US retail sales by 2003, are queuing up to the internet. However, the situation in India is little different. With limited penetration of computers and Internet, will online retailing (e-tailing) catch up is a big question mark. Retailing is expected to change with the rapid development of new online sales and distribution channels that can be used from anywhere but the extent to which it will grow in India depends on the shift in the mindset of Indians whose current state gives rise to many. As described in the section on challenges (e-tailing) these substitutes need to take care of these hindrances in order to grow in magnitude. Furthermore, instead of complete substitution, these media should be looking at possibilities of collaboration with the Existing store retailers. Substitution of need We take switching from one store or one type of store (e.g. small neighborhood retail outlet) to another (e.g. a big department store) as an example of this type of retailing. In this case, the buyers might be looking out for new experiences and might not mind the nominal switching costs (like longer distance to be covered) iii. Generic substitutionGeneric Substitution or doing without is not possible in case of retailing industry. Retailing will definitely remain, in one form or the other, as long as the manufacturers manufacture and consumers consume. Retailing does not seem to become extinct even in the future. The issue that remains to be addressed is just - what forms it keeps evolving into. One Most prominent form visible today is e-tailing.
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4. Bargaining Power Of Suppliers Is High If 1. There is high supplier concentration (i.e. few number of suppliers for the industry). In case of the retailing business, large numbers of manufacturers are competing for shelf space, resulting into low bargaining power of suppliers in this context. 2. There are other substitute products for sale to the industry. With large numbers of firms manufacturing similar goods or providing similar services, differentiation is what gives a competitive edge to some suppliers over others. But again due to spade of brands in the market bargaining power of suppliers is low even in this context. But in one specific case of exclusive distribution or dealership bargaining power of suppliers may be high. 3. The industry is not an important customer of the supplier group. This is not at all the case here. Today, apart from probably factory outlets, retailing is the only interface between manufacturers and consumers. The suppliers' product is an important input to the buyer's business. Generally, this is not the case with individual suppliers, hence affecting their bargaining powers adversely. 4. Switching costs from one supplier to another are high. This again is not the case in most of the categories of retail sales expect for the exclusive dealership of some firms. 5. There is threat of forward integration by suppliers. This might be a threat in the long run. Signs are visible in the form of direct mailers, door-to-door selling, teleshopping and e-tailing. 6. Marketers across the FMCG category and the durable sector feel that the retailer is going to be a powerful influence on buyers. A primary reason for this is trust. Many families take goods on credit from the retailer and moreover, spoilt goods are taken back by him. With all these facilities thrown in, when he recommends a product, the consumer has no reason to doubt him. 5. Bargaining Power Of Buyers Is High Bargaining Power Of Buyers is high for the retailing industry because of flux of retailers of varying sizes and types within the reach of consumers. Hence because of nominal or no costs of switching suppliers (for the final consumers), these retailers are fighting for the fixed budget of consumers. The customer in the past decade has become the key focus. The marketing strategies revolve around him. From shopping, the trend has shifted to Shopping entertainment and in certain cases, where retailers are providing highly differentiated products or services to the buyers; the buyers have low bargaining powers E.g. Crossword in Ahmedabad.
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CRM is the need for: Understanding customer behavior fully, Maximizing the value of customers, Really strengthening the relationship with customers, Speed and accuracy in information analysis, Foundation for organization wide data and information, Facilitating business process re-engineering, Improving quality and increased customer service, Personalization of goods and services, Improving customer retention
To conclude we can say that CRM is seen as a comprehensive business strategy that helps retail outlet to convert their near customers to dear ones. The branch manager agrees that collecting in depth information about customer helps the outlet to develop customer insight and increase customer orientation. In addition, it also enables them to offer quality solution to customers problems with increased speed. Undoubtedly, effective implementation and monitoring of CRM by the Indian outlet will result in providing superior experience to their customers, gaining long term loyalty and finally pocketing more revenues.
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ABOUT CRM
Introduction to CRM
Customer relationship management (CRM) is a business strategy to select and manage the most valuable customer relationships. CRM requires a customer-centric business philosophy and culture to support effective marketing, sales and service processes. CRM applications can enable effective customer relationship management, provides that an enterprise has the right leadership, strategy, and culture. CRM is a philosophy that puts the customer at the design point; its getting intimate with the customer. CRM is more a strategy than a process. Its designed to understand and anticipate the needs of the current and potential customer base a company has. Once you nail that, there is a plethora of technology that helps capture customer data and external sources, and consolidate it in a central warehouse to add intelligence to the overall CRM strategy. The concept of CRM is now gaining wide acceptance and is recognized as a powerful tool for business development and to have an edge over the competitors on account of the universal traits of human behavior. Organization have already focused on their products as the starting point and than looked around for customer to sell it. But the approach of CRM is different - it starts with the customer not the totality of customers because each customer is an individual and thus each customer has to be dealt individually to find out what they want design the product as per their need and supply it. In a nutshell, CRM is about growing enduring relationship with profitable customers.
Eight Myths Of CRM

Its hard to open a trade publication, newsletter, or industry white paper without reading about the high failure rates in CRM and newest answer to CRM success. Unfortunately, CRM often ends up sounding more like a religion than a business initiative, with high-level mantras and noble solutions designed mainly to drive the next consulting project. CRM project manager must debunk the myths and manage executive and business user CRM expectation or risk another round of flavour of the month enthusiasm followed by inevitable disillusionment. Myth 1: CRM can be purchased. Despite lip service to organizational change management and process alignment, most companies still earmark at least 75% of CRM budget for technology -- not people or process investment s. Often, companies with the best CRM processes actually have very little technology, instead relying on simple tools and organizational incentives (backed by clear CRM strategies) to get results.
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Myth 2: Customers can be managed. Too many companies try to force customers towards a management objective such as profitability or cost reduction. In the all volunteer demand chain: every participant must be encouraged with a clear core value proposition and the right incentives to participate. Customer needs with the right products and services. Myth 3: Sales can be automated. Forget about collecting extensive data from the sales reps of dictating how they spend their time. Instead, focus on offloading routine tasks such as collateral fulfillment, order status inquiries, paperwork, and quoting / proposal generation, and on delivering better, more qualified sales leads to shorten the sales cycle. The best CRM lets sales people do what they do best selling and employs technology around not at the center of the sales process. Myth 4: Starts with a 360-degree customer view. Setting complete integration as the first priority for CRM is akin to proposing world peace as the first step to help the poor admirable, but doomed to sink under the weight of high expectations and complex execution. Instead, prioritize information that can improve the customer experience or help the company make better decision (cross sell, retention, etc.). Putting integration in the context of the important interaction with top customers helps turn a multi-year architecture project into a roadmap for incremental improvement and value. Myth 5: Integration is a product. Right behind the integrate first consultants is the we integrate it for you software vendors. Products must still be customized to reflect business-specific flows and exception processing. Theres nothing simple about integration and no easy answer to getting different organizations to work together on behalf of the customer. Myth 6: Customer retention means service. Customer service can improve customer satisfaction and reduce costs -- but shouldnt be viewed as a primary vehicle for retention management. Satisfied customer can still leave, service relationship usually are not with customer decision makers (especially in B2B), and customer service doesnt have the relationship or selling skill to play more than a supporting role in customer retention. Instead, retention management requires its own processes to reward positive behavior, encourage more frequent activity, and proactively win back customers who have begun to consider other solutions.
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Myth 7: One size CRM fits all. In an industry focused on one to one personalization, vendors still insist (and companies still want to believe) that there is a single best solution to all CRM problems and customer types. Magic quadrants aside, the right CRM solution and business approach depends on what the customer processes are, and where the opportunities are to improve the customer experience and capture value, yours not ready to select CRM software. Myth 8: If you build it, they will come. The web is littered with under-utilized e-commerce and e-serve sites attempting to help customers and partners who never show up. Build in usage and diagnostic metrics as you implement new processes and watch carefully for areas where user acceptance is low. Dont launch new CRM functionality without pilot testing with representative users and plan to revise the application quickly as user obstacles surface. The most successful CRM project teams spend as much time in marketing, rollout, and testing as they do on software implementation. There is no short cut to customer enlightenment instead, companies must do the hard work to understand customer processes, issues, and opportunities, set clear goals (supported by specific actions nad metrics), and prioritize the long list of possible projects into a series of steps that can improve customer value and demonstrate results.
Ideas about the CRM

CRM is not another ATM or internet bank. It is not a checking account, a stock or an mortgage. In fact, CRM is not anything a customer should even know about. You will never sell your customer CRM. So, one can conclude that CRM is not tangible. If its intangible, can it be expected to produce a tangible return? Probably not, or at least not with any direct financial value to it. When financial conditions are tough, fancy theories are tested to the limit. So far, the ideas behind Customer Relationship Management (CRM) seem to be standing up. Spending on CRM products looks to be one of the bright sports in the whole IT market. The financial sector is in the vanguard of CRM enthusiasts. Why? First, its worth emphasizing that CRM is a business concept, not a technology. The basic principal is that question about the organizations customers, and how they can be served, are more fruitful than question about products. It is also misleading to think purely in terms of customer satisfaction, although that may be an important factor. Various slogans have been proposed such as one-to-one marketing, reduction of customer churn, the identification of profitable customers and so on.
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Yet none of these is a substitute for careful thought about the precise circumstances of the individual organization. While IT should never be the starting point for CRM, it is often the enabling factor. With the potential not merely to cut costs, but to bring new sales and develop new customers, well-applied CRM technology is relatively easy to justify. This remains true even when times are hard. It is this fact that is sustaining growth of around twenty fove per annum in the CRM technology sector. In the financial services sector, the growth is even higher.
What is CRM?
CRM stands for Customer Relationship Management. It is a process or methodology used to learn more about customers' needs and behaviors in order to develop stronger relationships with them. There are many technological components to CRM, but thinking about CRM in primarily technological terms is a mistake. The more useful way to think about CRM is as a process that will help bring together lots of pieces of information about customers, sales, marketing effectiveness, responsiveness and market trends. CRM helps businesses use technology and human resources to gain insight into the behavior of customers and the value of those customers.
Advantages of CRM
Using CRM, a business can:

Provide better customer service Increase customer revenues Discover new customers Cross sell/Up Sell products more effectively Help sales staff close deals faster Make call centers more efficient Simplify marketing and sales processes
What's difference between relationship marketing and CRM? Relationship marketing typically focuses only on relationships with customers. It has the same end goal. By and large it's CRM, but the technology component is very often missing, as is another component. That is the management of relationships with other members of the business network: the partners, employees, suppliers. In CRM, I believe it's really important to involve these other network members to ensure that the value that's ultimately delivered to customers is something which is going to satisfy and retain them.
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Bob Thompson You said earlier that there were some misconceptions or misunderstandings about CRM. After several years studying the subject, what are a few that come to mind? Francis Buttle A fairly traditional one is the misconception that CRM is an IT implementation. This has been a real problem for the large corporate who've been early adopters of CRM. Many of the failures, in my view -- and there have been many of them -- are due to CRM being regarded principally as an IT implementation, without the necessary fixes to the business strategy. If IT is applied to faulty business strategy, all that companies are going to do is become more efficient at doing the wrong things. If the core business strategy isn't put right first, it's a recipe for failure. Bob Thompson You said earlier that there were some misconceptions or misunderstandings about CRM. After several years studying the subject, what are a few that come to mind? Francis Buttle A fairly traditional one is the misconception that CRM is an IT implementation. This has been a real problem for the large corporate who've been early adopters of CRM. Many of the failures, in my view -- and there have been many of them -- are due to CRM being regarded principally as an IT implementation, without the necessary fixes to the business strategy. If IT is applied to faulty business strategy, all that companies are going to do is become more efficient at doing the wrong things. If the core business strategy isn't put right first, it's a recipe for failure. Bob Thompson In your book you define CRM as, the core business strategy that integrates internal processes and functions, and external networks, to create and deliver value to targeted customers at a profit. It is grounded on high quality customer data and enabled by IT. I'd like to explore two key phrases in that definition. One is to create and deliver value to customers, and the other is the notion of external networks. Much of what I've seen about CRM seems to be about how to extract value from our customer base, and here you're saying that CRM should be about creating and delivering value. Why would we want to deliver more value to customers? Why can't we just get more from them?
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Francis Buttle Because delivering value is a means to the end of extracting value. It is true to say that many CRM implementations do focus upon extracting value. Many of the analytical CRM implementations, for instance, are about exploiting customer data to the nth degree, to extract as much value as possible from customers by cross-selling and up-selling. That's all well and good, and it may in the end deliver good increases in shareholder value. But there is a risk of pursuing customers and cross-selling and up-selling ad infinitum without giving due thought to the value that's being created for them. Bob Thompson Could you give an example of how a CRM program can actually create and deliver more value for the company? Francis Buttle The notion of shareholder value underpins quite a bit of the thinking in the book. The value of a company is generally agreed to be based upon the present-day value of discounted profit streams from the future. So a company is worth whatever profit it can generate from its customer base in the future, discounted back to today's value. And, profit, in turn, is the residue of revenue, less costs. CRM implementations can impact on both sides of that profit equation. A lot of the service automation projects are designed around reducing the cost of customer service. But the revenue side of the profit equation can also be influenced by CRM implementations. To influence the revenue side, you've got to really be able to deliver excellent value to customers. An excellent value to customers means solving their problems better, more effectively, more efficiently than competitors. Companies that fail to do that and simply engage in analytical CRM to cross-sell and up-sell run the risk of alienating customers without delivering what will truly succeed at creating a high level of customer retention. Bob Thompson Based on what you've learned about what makes CRM work, what's one quick bit of advice you would give a CEO or business unit head? Francis Buttle I have no doubt about this. Get the business strategy right first. I like to think in terms of a cube. It's a three-dimensional matrix. On one side it's got customers. On another side it's got channels. And the third side of the cube has offers or value propositions. My advice to any CEO would be to get that cube sorted out before implementing CRM. Decide which customers or segments to target. Develop sensible customer acquisition, retention and development plans. Sort out the channel strategy first, direct or indirect, and which channel partners to use to reach the chosen customers.
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Then sort out which products, services, bundles of value to offer the chosen customers. Once that's in position, then start looking for IT to support it--but not until then.
Some important topic

1.Find Out What the Customer Wants, First
For example: By Chris Stiehl In the early 1990s, while working on the new car designs at Cadillac Motor Car Co., Chris Stiehl found that their customers had a different reaction to scratches and wrinkles in the leather than they did. They had thought these were "defects." Customers, however, were wary of "perfect" leather, without "natural markings" and thought it might be fake. Their leather had no scratches or wrinkles, but it did have a plastic coating that covered up the smell of tanning agents. It also removed the supple feel of the leather. Thus, in removing "natural markings" to please customers, they had actually spent extra money displeasing them. A small investment in market research enabled them to turn that situation around and develop standards for leather for Cadillac, contributing to winning the Malcolm Baldrige National Quality Award. The key learning point from this example was that a disciplined approach to listening to customers and translating their wants and needs into products and services was the basis for managing the customer relationship. How do you document what the customer wants and make sure that those desires remain the focus of your customer service efforts? An engineer and researcher in Fortune 500 companies for more than 25 years and a consultant for 10 years, over the past 20 years, Chris Stiehl developed a disciplined process for making sure the products and services that are delivered accurately reflect the wishes of the customers throughout their relationship with the company. Chris Stiehl call it the Customer-Driven Improvement Model. Dozens of companies have adopted this process with great success. The figure below illustrates how it works.
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Many companies say they are customer-driven, particularly with respect to customer service but do not have a disciplined process such as this one to document how the Voice of the Customer is incorporated into their work and internal metrics. The process begins with a formal collection of the Voice of the Customer (which may be internal customers, external customers, fellow employees or association members). To do this, we usually conduct one-on-one interviews, rather than hold focus groups. Because the research is qualitative, the number of customers who make a specific request is not very important, but the depth of the research is. In focus groups, a moderator typically asks the same questions in the same order, and the responses can be dominated by specific individuals. A one-on-one interview should be unique, discussing that particular customer's relationship needs and his or her passions. This Qualitative Research is used to develop corresponding Internal Predictive Measures. These internal metrics are linked to what customers are looking for from the company. They provide a basis for internally managing service according to the customers' wishes. How would you know if your customers' needs were being met, before surveying them to find out what those needs were? Your internal metrics should tell you. They translate the Voice of the Customer into survey questions that customers like to answer, because the questions are based upon the customers' thoughts and ideas. This produces external data, which is used merely to check on the accuracy of the internal relationship metrics. You should never be surprised by a survey result. Finally, all of the internal and external data is combined to direct improvement to the places that can have the maximum impact on the customer relationship--in other words, where you achieve the "biggest bang for the buck." (Note: This process is often called
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Quality Function Deployment)(QFD) or the House of Quality; see the May-June 1988 edition of the Harvard Business Review, reprint No. 88307). The same techniques work well in business-to-business relationships. How many of your internal metrics can be linked directly to customer needs? How many of them result in behaviors by your staffs that are counterproductive? Most CRM systems include both sales and service functionality. This includes account, contact, opportunity management and call center capabilities, such as case tracking and knowledge base. Many go beyond these functions to include marketing automation, partner relationship management and even supply chain management or SCM. Additionally, many CRM vendors provide some level of integration to traditional Enterprise Resource Planning (ERP) applications. There are very few aspects of modern day businesses that CRM does not touch. The difficulty companies have with embracing CRM solutions has historically been the struggle to understand the return on investment. Even in the practical life it is difficult to extrapolate the lost revenue as a result of lack of CRM system or one that fails to meet the needs of the organization. However, if companies spend the time to truly understand their processes from lead generation through order processing to customer service, they will inevitably come to a better understanding of where their inefficiencies exist and where technology can be aptly used to address the weaknesses. It is important for companies to answer the question, "What are my customer relationship management objectives?" From there, they should be able to formulate their policy and extract the high-level requirements necessary for selection of a CRM system that best fits their needs. It is also extremely important that customers understand the importance of the underlying technology platform in their selection. Questions such as, "Can I adapt this system to my business?" and "Can it integrate with my back-office functions?" should be foremost in their minds. CRM holds a lot of promise for improving customer loyalty resulting in top and bottom line benefits.
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2. Adoption: The Overlooked Key to CRM Deployment Success By Michael Heflin Dec. 13, 2003 -------------------------------------------------------------------------------Creating Stakeholders Can Matter More Than the Technology Itself The missing ingredient: inspiration Of course our first mistake in each case is to fall a bit too much in love with the technology benefits. That leads us to the second mistake: overlooking the question of whether the 'gift' actually helps the user, at which point they buy into the 'gift' and change their work habits long enough to taste the benefits. Consequently, we do too little in the way of sustained direction, training, and incentives. We forget to methodically and relentlessly inspire. According to the Alexander Group, when asked about the top challenges for CRM success, seasoned enterprises rank technology well below managing employee resistance to change (63 percent) and optimizing processes and job roles (56 percent). To address those toughest challenges, an adoption program, concurrent with technology deployment, can put a proper perspective on the technology itself as a means to the real goal: inspiring change toward every stake holders benefit. Creating stakeholders: a case study In early 2003, a large regional communications service provider (CSP) deployed a sales effectiveness solution to thousands of sales users. This sales effectiveness application is designed to boost productivity during the sales interaction with prospects by providing rapid recommendations and guidance to contextual, solution-specific information such as product information, selling tips, competitive information, configuration, pricing and promotions to the sales person at the point-of-sale--when it is most valuable. To achieve user buy-in, adoption and ROI success, the CSP and the sales effectiveness vendor co-developed an adoption program that embraced each set of stakeholders-marketing, sales operations, sales executives, and users. The intent of the program was to achieve regular user adoption not temporary compliance. It also incorporated specific adoption goals: Forty percent to 50 percent sustained adoption within 60 days. This is compared to sales technology adoption, which ranges from 15 percent to 25 percent.
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The CSP's measurable results exceeded its lofty goals Fifty percent to 60 percent sustained adoption Sixty-eight percent completion of introductory training A 217-percent increase in logins A record of 209 percent more revenue than non-users A record of 93 percent greater value of sales proposals Indeed, over a three-month period, new users grew by 78 percent in the second month, and 72 percent of established users returned in the third month. The strongest evidence that sales staff were buying in: Proposals generated using the application grew 2,642 percent between the fifth and eighth months. A multi-layered campaign How did the plan achieve such stellar results? By employing all of the following adoption and change management strategies: Executive leadership, direction and communication Metrics--rewards and incentives Consistent, channel-specific communication Training
Strategy 1: Executive leadership, direction and communication Even employees that are the most resistant to change will give high attention to any change directive that enjoys strong and sustained endorsement from the bosses. The CSP did this down the chain of command, from corporate and division executives through sales and marketing managers. Management collaborated with the supplier to define and then to present and reinforce the business case and benefits in context to the current organizational plans and strategies. Going beyond short-lived fanfare at the launch of the program, leadership committed to ongoing communications and branding efforts and to keeping the sales effectiveness application on agendas. At the same time, it established and nurtured a feedback loop for end-user input, as well as a system for tracking training. Strategy 2: Metrics: rewards and incentives Good grades may prove reward enough for some, but this CSP sought to create incentives tailored to each stakeholder group, including sales users, managers, and sales support. Tying incentives directly to usage, revenue and skill improvement, the CSP developed a range of rewards:
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Regular, swift recognition from higher-ups Frequent, visible awards Cross-organization contests (e.g., holding contests between sales manager teams to personalize the attention of the managers) Free dinners, tickets and other incentives proved to keep interest alive along the path to making usage second nature. Ongoing measures of usage and impact assured that management kept its eye on the adoption prize. Strategy 3: Consistent, channel-specific communication Identifying and leveraging every opportunity to promote adoption can spell success. Such opportunities grow out of regular meetings and regular communications by sales operations, sales managers and sales executives. Scheduled rollout updates, contests and award ceremonies all proved effective in keeping the sales effectiveness solution on everyone's radar, as did communications tagged to new upgrades. In addition to piggy-backing adoption messages onto the plethora of regular organizational electronic communications, this enterprise found added effectiveness in good old in-house merchandizing--posters, mugs, mouse pads, and other stuff that one could see and hold. However, a key was consistent delivering message to sales users of the specific benefits to them by exposing the success of peers using the tool. Strategy 4: Training The goal of a training program is to measurably improve productive use of the sales effectiveness system to achieve projected business outcomes. Handing our child a manual to a new toy does not ensure that it gets used. Instead, providing a short tips and tricks session, handholding, and incentives can be used as part of a comprehensive training program to maximize participation and completion requirements. Real tracking and enforcement of training milestones by management ensure basic exposure. Thereafter, mandated hands-on use immediately following live training, weekly "lunch and learn" sessions, searchable FAQs, monthly update, and tips emails--all these bridge and extend training into actual adoption and usage. Studies find that, in the absence of a dedicated adoption strategy, more than 50 percent of new application introductions fail. A company can buck these statistics by implementing an adoption strategy as seriously as it implements the technology. Additionally, have technology that is indented for value to be seen by the actual users. This supports the real goal: work habits to deliver corporate results.
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3.In the West, the customer is King, but in Japan, the customer is God . -- A Japanese management mantra Neuro Linguistic Programming (NLP) is a set of techniques that help manage people interactions and relationships. The key focus is on how we represent reality, and the thesis is that we can mold reality with appropriate thoughts and words. And, of course--this the most common occurrence--we can misrepresent our reality with the wrong words and concepts. I guess this happened to the business community with the loyalty concept. Corporate world, don't be misled by your own hype I guess the business community used the word "loyalty" as a shortcut meaning: "a customer who buys our stuff repeatedly." But--as sometimes happens with companies--they actually believed their own hype and got so enamored with the idea of a loyal customer they believed it happened in the real world. Clearly, it's a wrong neuro linguistic programming at work. Because it doesn't happen in the real world. Customers are people, and they don't give away their precious loyalty that easily. They save loyalty for really important issues: beloved ones, country, some principles, a favorite ball team. Assuming they can really be loyal to a box of cereal, a phone company, a car or a bank (come on, folks!) is wishful thinking at best. People in boardrooms all over the world can amuse themselves thinking differently, but customers have the power--total power, I should say. They can choose every time which product is worth their hard-earned money. Yes, they can be repetitive in their choices sometimes, but they are always ready to switch to your competitor, if given a good chance. Customers are intrinsically disloyal. Why that happens is very easy to see: They don't really need drills, they need holes. So, most products that appear to be the same are the same, and the most inexpensive one wins. Loyalty from the right point of view: the customer's Of course, there are different types of products and different attention spans: A new can of tuna deserves less attention than a new car. Moreover, a car brand says something about you, while hardly any can of tuna can do that. And the concept of brands saying something about the customer who buys them, brings up the loyalty concept with an interesting twist: Customers do expect brands and products to be loyal to them. Much like a divinity, a customer expects to be at the center of the brands' universe.
She ideally wants to think she is the only really relevant customer of her chosen brand, that the brand does things for her, with her in mind. I'm always amused by the navet people show when they interact with correctly personalized direct mail (not "Dear Mr. John Smith," but "Dear John," if you know what I mean): Suddenly, the customer forgets it's just the Marketing Matrix at work and assumes "they are really talking to me." Because customers want to believe it. They want to think they aren't just a little cog in the marketing machine. And, yes, because they sign the check that pays my bills and, presumably, your bills. So, understanding this point is key, if we want to manage loyalty in the correct way. And this leads to questions we, as marketers, have to answer. How do you manage to be loyal to your customers? Are you consistent in the way you behave, in the way you talk, in the way you satisfy your customers' needs and--even more importantly--their desires? In short, how do you worship your customer-God? CRM, the tool for the worshipper company OK, this isn't your father's way of seeing CRM at work, but, hey, we are no longer in the late '90s just fiddling with Relationship Marketing
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and the fabulous (if expensive) CRM toys ... er ... tools. Let's not sound too idealistic. This is the real reason you invest in CRM: You want to milk your best customers for all the money they can spend with your category. Every trick is allowed, even data-mining your customer base to predict the next best product and then matter-of-factly dropping it as a recommendation in a customer service conversation. And what is this if not acting like a devout worshipper of your customer-God? Databases and marketing automation and statistical software are just the tools of the worshipper company. The more you know your customer-God, the more you can be loyal to her: saying the right words, doing the right things, offering the right offers, at the right moment. CRM strategy and tools can help you remember who your customer is (data) and remind your customer who you are (communications) in a virtuous circle where you can make your customer say, "Now, they really know me!" Yes Virginia, it sounds like that, no? Turn the loyalty quest upside down and reap the benefits. You can't make your customer loyal to you; this is just the opposite way of seeing things from a customer's perspective. But you can increase your customers' perception that you are loyal to them--more loyal than your competitor is. You can remember your customers' purchases, desires and requests. You can forecast your customers' new requests. You can say the right things, talk like your customer and be like your customer. In exchange for this worship, your customerGod will repay you with his power: purchases given to you and not to your competitor. A caveat: While all customer-Gods look alike, they are not. Most of them aren't worth your attention and less so your money. The trick, of course, is to pick the right customer-Gods. But you have plenty of tools for that in your CRM arsenal haven't you? So my advice is: Stop wasting time and money trying to earn your customer loyalty and start looking for ways to be loyal to your customer. And remember what Arthur C. Clarke wrote: Any sufficiently advanced technology is indistinguishable from magic. You can play this game quite well with your CRM tools and strategy and receive the gift your customer-God is happy to distribute. Customers aren't too fussy. Just remember who is in power.
4. The Demand for Loyalty Marketing: Top 10 Trends

In today's marketplace, companies face many issues that increase the demand for marketing strategies focusing on customer loyalty. More and more, companies realize that their most precious asset is their existing customer base. Traditional marketing, focusing heavily on gaining new customers through mass marketing efforts, is evolving at a rapid pace. Marketers are allocating more resources towards customer loyalty and retention programs. Terms such as "loyalty," "frequency," "retention" and "relationship marketing" are all used to define the same basic marketing approach. The universal goal of loyalty marketing is to identify, segment, grow and retain existing customers by communicating and rewarding desired behavior. Here's a brief look at the top ten trends impacting almost every company, selling almost every kind of product, in almost every marketplace.
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1: Consumers Are Smarter And Expect More. As the general population becomes better educated and have greater access to data for comparison-shopping, consumers approach purchase decisions with greater scrutiny. The widespread growth of the Internet and prevalence of consumer publications both provide greater access to product information. To meet these growing consumer demands, many companies are launching loyalty marketing programs to provide differentiation and added value. 2: The Internet Has Led To Disloyalty. The Internet has introduced a new distribution channel for product information and sales, causing many consumers to switch purchasing habits, brands and methods. Further, researchers report astonishingly low consumer loyalty in the Internet environment. 3: Customer Service Issues. Low unemployment has led to a reduction of the skill level and quality of front-line customer service. Poor customer service leads to unhappy customers who are likely to try a competitor or completely defect. This means companies must create a "barrier to exit" for their most profitable customers. This approach is a hallmark of most loyalty marketing programs. 4: Price-Based Switching Programs. Most of us have experienced the tempting telephone offer to switch long-distance service to get a check for $20 to $100. Credit card companies use similar tactics with super-low teaser or balance transfer APRs. These switching programs have taught consumers to be on the constant lookout for a better offer. In many industries, loyalty marketing programs have helped companies to establish true "brand equity" to combat this threat. 5: The Evolution Toward a Global Market. As the economy opens across the globe, U.S. companies are met with increased competition. Many U.S. companies are using loyalty marketing initiatives to establish stronger value propositions to block foreign threats for market share. 6: The CRM Explosion. The term "customer database" is archaic. Technology giants like Siebel and Oracle have developed and continue to enhance CRM and data warehousing systems that collect and mine valuable customer information in real time. Marketers are incorporating these systems with software innovations like E.piphany's E5 to use the data for smart and ROIbased loyalty marketing programs.
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7: Deregulation. First we had to choose long-distance companies. Soon consumers will be inundated with marketing campaigns for local telephone service, cable, electricity and even gas. Challenged with commodity-based service products that offer little opportunity for brand differentiation, these companies are developing loyalty marketing strategies to establish increased value. 8: Mergers and Acquisitions. For many industries, "acquire or be acquired" has become the name of the game. Mergers and acquisitions can have a significant impact on brand and product loyalty and cause many loyal customers to look for alternatives. For example, in banking frequent name changes are contributing to record attrition in excess of 20 percent per year. 9: Mass Media Is Expensive. Advertising is getting more expensive as marketing budgets are being cut. Loyalty marketing has proven to be a superior investment for companies by generating incremental revenue from existing customers while tracking marketing ROI down to the individual customer level. 10: The Competition Is Doing It. Loyalty marketing has become a table stake in many industries. Almost every hotel chain, airline and credit card company offer a frequent customer program. Customers have come to expect them and compare benefits and rewards of competing companies. As a result, competitors are racing to introduce new rewards, better benefits and to create a unique program that differentiates itself from competitors. These trends pervade every market situation. Companies are either jumping on board with loyalty marketing, or they're watching their customers go by on the competitor's train.
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Core CRM Development Roles
Job Role
Description
The business sponsor might serve across a single CRM Business Sponsor: project or across the entire program. His main role is to establish the vision, articulate overall goals and objectives, set the tone for the project team, and serve as a tiebreaker for implementation issues. The business sponsor often funds the initial CRM application. The more departments CRM spans, the greater the level of authority the sponsor should have.
CRM Steering Committee:
For cross-functional or enterprise CRM initiatives where implementation must be prioritized, a committee of decision-makers familiar with the "pain points" CRM can address should convene on a regular basis to provide new requirements, prioritize proposed improvements, and communicate key corporate initiatives. This person's job is to ensure that the requirements defined by the business sponsor and steering committee dictate the functionality to be implemented. The implementation project manager oversees the day-to-day implementation activities, tracks status, and updates the business sponsor on current issues. The lead developer should manage the technical development and customization of the CRM product as it relates to the requirements. She should participate in CRM technology selection (see Chapter 8) and hire the appropriate developers to implement the CRM toolset. The database developer should lead the necessary data integration, regardless of whether it is operational or analytical CRM. Often this means working with the company's data warehouse and its development team. In other cases, an understanding of key company source systems and how to capture their data is mandatory, requiring a separate team of database administrators and
Implementation Project Manager:
Lead Developer:
Database Developer (and team):
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Job Role
Description data "extraction" experts.
Front-end Developer (and team): Subject matter experts (SMEs):
Depending on the chosen CRM product, programming is needed to develop or customize the end-user interface.
Critical to CRM success are subject matter expertsusually businesspeople from the department slated to use the CRM system after it's in production (for instance, a CSR or a sales manager). SMEs usually have strong ideas of what CRM should and shouldn't provide and should participate regularly in the development and testing of a CRM product.
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RESEARCH METHODOLOGY
The project is all about the CUSTOMER RELATIONSHIP MANAGEMENT AT RETAIL OUTLET OF V-MART For that other various related information are as follows OBJECTIVES: To get ideas about the retailing, retail outlet and also about the retail industry. To know the grievances of the customer. To measure the satisfaction of customer And how to make customer more loyal and retain them.
METHODS OF DATA COLLECTION
Primary methods 1. Questionnaire 2. Face to face talking. Secondary methods 1. Books 2. Websites 3. Other project reports
SAMPLE DESIGN: Sample size:
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The sample size of this survey was 240 customers at the store situated at Law garden. Sampling type In this project we have follow the Judgment sampling and also the convenient sampling method as a part of selection of customer. Targeted population Sample unit To define sampling unit, we are aware of who is to be surveyed for this project. In this project sampling unit is those, whether male, female, student, employer, employee or retired who are coming it is immaterial that they have purchasing or not.
RESEARCH METHEDOLOGY
DATA COLLECTION Age Group:Age < 20 Yr. 20-29 Yr. 30-39 Yr. 40-49 Yr. > 50 Yr. No. of People 16 154 38 20 12
Occupation:Occupation No. of People
Student Business Service House wife Professional Retired
88 48 78 10 12 4
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Number of Family Members:No. of Family Members 2 3--5 6--8 Less than 8
No. of People 26 164 36 14
Income slab (per month):Income (Per Month) >5000 5--10000 10--15000 <15000 No. of People 18 68 90 64
Stores Visited Up till Now:stores visited Before Pantaloon V-MART EXIM Body line jade blue Big Bazar Kolkata Bazar Westside No. of People 178 240 46 94 92 188 118 142
Frequency of visiting Outlet
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Frequency Of visit first time some time mostly regularly
No. of People 24 96 34 86
Reason of This Visit:Reason Of this visit Came for window shopping Accompanied a friend Knew about sell going on Offers better discount than others To buy a gift Buy only from this store To purchase a particular item Not specific Other please mention No. of People 38 36 28 54 42 6 104 48 0
Time since Last Visit:Time Since Last visit no Within 1 Week 1-2 Week back 2-3 Week back 3-4 Week back 1-2 Months More than 2 month No. of People 24 28 30 17 24 59 58
Factors affect you while visiting particular outlet:Factors status Price discount advertisement reference group No. of People 34 111 22 26
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promotional activity service convenience Other please mention 33 48 66 26
Factors considering during buying decision:Factors Preference price product durability quality brand name word of mouth had purchased and found good timing Other please mention No of Respondents 4 5 16 2 52 10 42 14 34 12 2 8 4 28 26 30 12 4
1 70 18 128 8 2 8 0 0
2 92 32 58 38 0 8 2 0
3 50 76 24 22 12 24 8 0
6 0 6 6 10 26 12 18 2
7 0 2 2 2 10 14 36 2
8 2 0 0 6 2 2 2 20
Extra facility you want from us:extra facility Price discount more quality Extra services more variety No. of People 96 78 32 68
How you come to know about schemes:Media advertisement reference group news paper hoardings WOM magazine No. of People 68 48 72 48 32 2
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radio 22
Would you like to be informed about schemes:Would you like to be Informed about schemes yes no No. of People 176 64
By which media you would like to be Informed:Media telephone advertisement post hoardings E-mail No. of People 106 50 42 14 24
Are you satisfied with this visit of outlet:Satisfied or not so-so yes no No. of People 10 178 52
Shopping Experience in percentage:Factor Overall shopping experience Offer on product Quality of product Reputation Product display Service at outlet Variety of products Pricing of the products V.S. 1 3 6 8 8 7 9 7 S. 80 64 65 57 74 58 44 70 C.S. 10 25 21 31 8 16 16 12 U.S. 9 9 6 4 9 19 29 11 V.U.S. 0 0 1 0 0 0 2 0
Do you are aware of exchange policy:-
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Aware yes no No. of people 132 108
Have you encountered any problem:Response yes no No. of people 8 232
Will you recommend this outlet to others:Response yes no No. of people 198 42
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DATA ANALYSIS Age Group:-
Age Group
> 50 Yr., 5% 40-49 Yr., 8% 30-39 Yr., 16% < 20 Yr., 7%
20-29 Yr., 64%
< 20 Yr.
20-29 Yr.
30-39 Yr.
40-49 Yr.
> 50 Yr.
From Graph we can see that 64% people who visits V-mart fall under the category of age between 20-29Yr. Second highest is the age category of 30-39 Yr. which is about 16% of total population visiting V-Mart. The other are 8% between 40-49 Yr. of age, 5% between who are >50 and 7% are those who are less than 20 Yr. of age.
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Occupation:Occupation
Retired, 2% Professional, 5% House wife , 4% Student, 36%
Service, 33% Business, 20%
Student
Business
Service
House wife
Professional
Retired
In the case of occupation of people visiting V-mart from chart we ca see that 36% percent of people which is the highest of total population is student, the second highest is people who are engaged in services which is 33%, people with there own business are 20%. Other are 5% who are professional 4% are house wives and 2% are retired.
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Number of family members:Number of family members
6--8, 15%
<8, 6%
2, 11%
3--5, 68%
3--5
6--8
<8
In the case of No. of family members 68% family has number of family member in the group of 3-5 which is highest among sample. The other are 15% between 6-8, 11% are those who are 2 family members and 6% are those who are more than 8 family members.
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Slab of income (Per month):-
Slab of income (Per month)
Greater than 15000, 27%
Less than 5000, 8% 5--10000, 28%
10--15000, 37%
>5000
5--10000
10--15000
<15000
From chart we can see that the major part of people who visited V-mart are those whose income lies somewhere in-between 10-15 thousand (per month) which 37%. The second highest is income in-between 5-10 thousand (per month) which is 28%. Others are greater than 15 thousand (per month) which is 27% and less than 5 thousand which is least among all is 8%.
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Stores visited up-till now:-
Stores visited Up-till now
Westside, 71 Kolkata Bazar, 59 Big Bazar, 94 jade blue, 46 Pantaloon jade blue V-MART Big Bazar
Pantaloon, 89
V-MART, 116 EXIM , 23 Body line, 47 EXIM Kolkata Bazar Body line Westside
In this question we can see 116 numbers of people had visited V-mar before this particular visit which is highest. The second highest is Big Bazar which was visited by 94 people before this visit. Pantaloon is on third rank with visit of 89 people surveyed. The other are Westside-71, Kolkata Bazar, Body line-47, Jade blue-46 and EXIM-23.
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Frequency of Visiting V-Mart:-
Frequency of visiting V-Mart
first time, 10% regularly, 36%
some time, 40% mostly, 14%
first time
some time
mostly
regularly
From chart we can see that 40% of people visits V-Mart some time, 36% Visits V-Mart regularly, 14% visits V-Mart mostly and the percentage of people who were visiting V-Mart first time are 10%.
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Reason of This Particular Visit:-
Reason of Visiting
Came for window shopping, 19 Not specific, 24 To purchase a particular item, 52 Buy only from this store , 3 Came for window shopping Knew about sell going on To buy a gift To purchase a particular item Accompanied a friend, 18 Knew about sell going on, 14 Offers better discount than others, 27 To buy a gift, 21 Accompanied a friend Offers better discount than others Buy only from this store Not specific
From above chart we can see that from our sample 52 people visited this outlet to buy particular item from outlet and this is highest number among all other option. Second highest 27 people which came here because V-mart offers better discount than others. Not specific which is answer of 24 people is at third place. To buy gift is answer of 21 people, for window shopping it is 19, accompanied a friend is 18, because of particular sell is 14 and 3 people are those who buy only from this out let.
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Time Since Last Visit of V-Mart
Time Since Last Visit
More than 2 month, 24%
no, 10% Within 1 Week, 12% 1-2 Week back, 13% 2-3 Week back, 7% 3-4 Week back, 10%
1-2 Months, 24%
no 2-3 Week back More than 2 month
Within 1 Week 3-4 Week back
1-2 Week back 1-2 Months
We can see that 24% people had visited V-Mart 1-2 Months back which is also equal to option of more than 2 Month. Third is option of 1-2 week back which is 13%. Others are 12% within 1 week 10% 3-4 week back and the same is people who are visiting first time. Last is 7% who has visited 2-3 week back.
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Factors affect while visiting particular outlet:-
Factors Affects While Visiting Any Outlet
Others , 7% convinience, 18% service, 13% promotional activity, 9%
status , 9% price discount, 31% advertisement, 6% refernce goup, 7% advertisement service
status refernce goup convinience
price discount pramotional activity Other please mention
From chart we can say 31% people look first at the price discount while visiting particular outlet. 18% people believe that convenience is the factor which affects the most while visiting particular outlet. 13% are those who see services, 9% people are those who see promotional activity of stores and same number of people says that status of stores is of important for them. 6% believes in advertising and same number of people gives important to other factors which are not mentioned with this options.
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Factor considering while taking buying decision:1. Price:Price

50 40 Percent 30 20 10 0 1 2 3 4 5 Preference 7 1 0 6 0 7 1 8 30 22 40
From given eight option 30% of people give 1st preference to price while they are taking buying decision. 40% gives second preference, 22% gives third, 7% gives fourth, 1% gives fifth and eighth preference to price and as compared to other factors.
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2. Product durability:-
Product Durability
50 40 Percent 30 20 10 0 1 2 3 4 5 6 7 Preference 9 16 4 3 1 0 8 40 27
From given eight option 9% of people give 1st preference to Product durability while they are taking buying decision. 16% gives second preference, 40% gives third, 27% gives fourth, 4% gives fifth, 3% gives sixth, 1% gives seventh preference to Product Durability and as compared to other factors.
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3. Product Quality:-
Product Quality
60 50 Percent 40 30 20 10 0 1 2 3 4 5 6 7 Preference 25 10 55
0 8
From given eight option 55% of people give 1st preference to Product Quality while they are taking buying decision. 25% gives second preference, 10% gives third, 4% gives fourth, 2% gives fifth, 3% gives sixth, and 1% gives seventh preference to Product quality and as compared to other factors.
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4. Brand Name:-
Brand Name
30 25 Percent 20 15 10 5 0 1 2 3 4 5 6 7 8 Preference 5 24 14 6 1 4 27 19
From given eight option 5% of people give 1 st preference to Brand name of while they are taking buying decision. 25% gives second preference, 10% gives third, 4% gives fourth, 2% gives fifth, 3% gives sixth, 1% gives seventh preference to Product quality and 4% has given last preference to it as compared to other factors.
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5. Word of Mouth:-
Word Of Mouth
35 30 25 20 15 10 5 0 29 28
Percent
13 2 1
15 11 2
0 2 3 4 5 6 7
Preference
From given eight option 2% of people give 1st preference to Word of mouth of while they are taking buying decision. No one gives second preference to it, 13% gives third, 15% gives fourth, 29% gives fifth, 28% gives sixth, 11% gives seventh, and 2% gives eighth preference to Word of mouth as compared to other factors.
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6. Had Purchased and Found Good:-
Had Purchased And Found Good

30 25 Percent 20 15 10 5 0 1 2 3 4 5 6 7 8 Preference 6 6 18 9 11 2 25
23
From given eight option 6% of people give 1st & 2nd preference to had purchased and found good of while they are taking buying decision. 18% gives third, 25% gives fourth, 23% gives fifth, 9% gives sixth, 11% gives seventh, and 2% gives eighth preference to it as compared to other factors.
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7. Timing:-
Timing
50 40 Percent 30 20 10 0 9 0 1 2 2 3 4 5 6 7 13 13 2 8 20 41
Preference
From given eight options no one gives 1st preference to Timing while they are taking buying decision. 2% gives second, 9% gives third, 13% gives fourth, 13% gives fifth, 20% gives sixth, 41% gives seventh, 2% gives eighth preference to it as compared to other factors.
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Others:-
Others
80 70 60 50 40 30 20 10 0 67
Percent
0 1
0 2
0 3
7 4
12
7 6
7 7 8
Preference
In the case of other factors than seven we have considered here the preference given is as explained below. We can see that no one gives first, second, or third preference to other factors. 7% gives forth preference to it. 12% gives fifth preference 7% gives sixth and seventh and 67% people give eighth preference.
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Extra Facility:-
Extra Facility
more variety, 25%
price discount, 35%
extra services, 12%
more quality, 28% more quality extra services more variety
price discount
In case of extra facility by V-Mart 35% of people want more price discount which is choice of majority among all options. 28% want more quality which is second highest. 25% want more variety and 12% want extra services from store.
74
How do you come to know about schemes:-
How Come To Know About Schemes
radio, 8% WOM, 11% hoardings, 17% news paper, 25% advertisement reference group
advertisement, 23% reference group, 16%
news paper
hoardings
WOM
radio
The highest percent of people come to know about schemes from news paper, second highest is the category of people who come to know about schemes from advertisement which is 23%. Other is 17 % from hoardings, 16% from reference group, 11% because of word of mouth (WOM), 8% from radio which is the least one.
75
Would you like to be informed about schemes:-
Would You Like To Be Informed About Schemes
no, 27%
yes, 73% yes no
73% people say they would like to be informed about schemes and 27% says they would not like to be informed about schemes. The media by which people would like to be informed about schemes are described next.
76
The media by which you would like to be informed:-
Media by which you Would Like To Be Informed
E-mail, 10% hoardings, 6% telephone, 45%
post, 18% advertisement, 21% telephone advertisement post hoardings E-mail
In case of media by which people would like to be informed by store are as explained under. From chart we can see that majority of people will like to be informed by telephone which is 45%. Second highest part 21% people will like to be informed by advertisement, 18% like post, and 10% by E-mail and least is by hoarding which is 6%.
77
Satisfied or Not:-
Satisfied or Not
no, 22%
soso, 4%
yes, 74%
soso
yes
no
74% people say they are satisfied with this particular visit 22% are not satisfied with there visit to this outlet and 4% people are so-so satisfied with this particular visit.
78
Experience:-
Overall Shopping Experiece

V.U.S., 0% C.S., 10% U.S., 9% V.S., 1%
S., 80%
V.S.
S.
C.S.
U.S.
V.U.S.
From chart we can see that 80% people are satisfied in case of overall shopping experience and 9% are unsatisfied. 10% cant say any thing regarding there overall shopping experience, 1% people are delight or very satisfied with shopping experience. None of them were highly unsatisfied.
79
Offer on Product:-
Offer On Product
V.U.S., 0% U.S., 9% C.S., 25% V.S., 3%
S., 63%
V.S.
S.
C.S.
U.S.
V.U.S.
From chart we can see that 63% people are satisfied in case of offer on product being offered by store and 9% are unsatisfied. 25% cant say any thing regarding Offers on different product, 3% people are delight or very satisfied with offer on product. None of them were highly unsatisfied.
80
Quality of product:-
Quality Of Product
V.U.S., 1% U.S., 6% C.S., 21% V.S., 6%
S., 66%
V.S.
S.
C.S.
U.S.
V.U.S.
From chart we can see that 66% people are satisfied with Quality of product at store and 6% are unsatisfied. 21% cant say any thing regarding quality of different product, 6% people are very satisfied with quality of product. 1% was highly unsatisfied with the quality of product.
81
Reputation:-
Reputation
V.U.S., 0% U.S., 4% C.S., 31% V.S., 8%
S., 57%
V.S.
S.
C.S.
U.S.
V.U.S.
From chart we can see that 57% people are satisfied with reputation of store and 4% are unsatisfied. 31% cant say any thing regarding reputation of store, 8% people are very satisfied with Reputation of store. None of them were highly unsatisfied.
82
Product Display:-
Product Display
Highly Unsatisfied 0% Very satisfied 8%
Unsatisfied 8% Can't say 9%
Satisfied 75%
Very satisfied
Satisfied
Can't say
Unsatisfied
Highly Unsatisfied
From chart we can see that 75% people are satisfied with Product display at store and 8% are unsatisfied. 9% cant say any thing regarding Product display at store, 8% people are very satisfied with Product display at store. None of them were highly unsatisfied.
83
Service at Store:-
Service At Outlet
V.U.S., 0% U.S., 19% V.S., 7%
C.S., 16% S., 58%
V.S.
S.
C.S.
U.S.
V.U.S.
From chart we can see that 58% people are satisfied with service at store and 19% are unsatisfied. 16% cant say any thing regarding service at store, 7% people are very satisfied with service at store. None of them were highly unsatisfied.
84
Variety of Product:-
Variety Of Product
V.U.S., 2% V.S., 9% U.S., 29%
S., 44% C.S., 16%
V.S.
S.
C.S.
U.S.
V.U.S.
From chart we can see that 44% people are satisfied with variety of product and 29% are unsatisfied. 16% cant say any thing regarding variety of product, 9% people are very satisfied with variety of product. 2% of them were highly unsatisfied.
85
Pricing:-
Pricing Of Product
V.U.S., 0% U.S., 11% C.S., 12% V.S., 7%
S., 70%
V.S.
S.
C.S.
U.S.
V.U.S.
From chart we can see that 70% people are satisfied with Pricing of product and 11% are unsatisfied. 12% cant say any thing regarding Pricing of product, 7% people are very satisfied with Pricing of product. None of them were highly unsatisfied.
86
Are You Aware of Exchange Policy:-
Aware Of Exchange Policy
no, 45%
yes, 55%
yes
no
In case of awareness regarding exchange policy 55% people said that they are aware of this policy and 45% people said they are not aware of this.
87
Would you like to recommend others about this outlet:-
Would Like to Recommend Others
no, 18%
yes, 82% yes no
In case of recommendation of outlet to others 82% people said they will recommend it to others and 18% said that they will not recommend others.
88
FINDINGS During the survey and analysis period we come to the following findings. The age group between 20-29 had visited more than other age group. Majority of the visitors are student and service people than business man. Visitors follow under 3-5 members in their family more than others. Higher number of samples follow under 10-15 thousand income slab per month. Majority has visited V-MART, Pantaloon and Big Bazar equally. During the survey the people who had visited some times are more than the people who are visiting mostly and regularly. Within one month there are 122 and more than one month there are 158 people who had visited lastly. It means the ratio is near about 60:40. People concentrate more on price discount, convenience and service while visiting a particular outlet. Customer wants more variety and better quality. In advertisement about schemes newspapers, holdings and reference group plays a more important role. Majority wants that they are informed about schemes through telephone and then advertisement post and E-mails. Majority of the sample near about 75% was satisfied and only 25% were unsatisfied Near about 40% of the people were not aware of exchange policy over there. The approximate percentage of cant say and unsatisfied consumers is more.
89
SUGGESSIONS On the basis of analysis done by us, we can come to the following suggestion and recommendations. Concentrate more on below 20 years and 30-49 years customers. They also have to concentrate more on service people and business man. The some sort of concentration is also required for the first time and some times visitors. Increase the frequent visits and reduce the no. of visits more that 2 months by introducing various schemes on gradual time periods. As service is one major factor in visiting outlet so it is better to more concentrate on it than price discount and conveniences is also need concentration. Give more emphasis on word of mouth and as a advertisement media and also reference groups and holding equally. Put more efforts on scheme information by advertisement, telephone and E-mail. Try to reduce no. of dissatisfaction by increasing variety and improving services. And also by improving staff behavior. Each point of cant say and unsatisfied is considered seriously and put immediate efforts to improve on those point by/with alternative solutions. Make big notice about exchange policies and their rules such that it is noticed by everybody. Also take some special action during the pick season regarding the exchange policy and period. Very few person have a problem with behavior of staff members though it should taken great care in staff behavior by various training program, motivation and guiding etc. The bill structure is also required some restructured because some people were not like the bill structure. Develop proper facility regarding lavatory. Many people fill congested in outlet so the display should be taken care of. The more problem is regarding the variety of the product. So do some favor to varieties foe increasing customer delights. Improve quality of service to make customer more loyal and also to retain them.
90
Give some sort of training to the staff member regarding the daily activity in store. Staff member include in-store sales man, sales girls and security guard. The outlook of the store from the outside is not so attractive specially in nights. It should be developed such that a person can take notice of V-MART existence from the far away while passing through. Parking space and facility need some sort of improvement and development. Put more mirrors so that the customer can see weather the particular item suit his/her outlook. Introduced a plethora of loyalty cards in anticipation of using the knowledge acquired from these cards to develop stronger relationships with their customers, and improve performance and profitability. When customers possess a loyalty card they will use it every time they make a purchase. Focus more on Advertising for making more awareness, increase the market share and reinforcing the image of V-MART in the customers mind. Through more investment in advertising the statement like Expose more goods to more people so you can get more business will become success. And also the slogan of V-MART SABSE SASTA SABSE ACHHA will fulfill.
LIMITATIONS
91
The time period we can devote was very less due to also fulfill the other academic subjects. In this survey our area that is V-MART at law garden only is also become a limitations and we can not cover rather than these. Some times customers may not provide true information Customer may not have time so they may be give answers in hurry or may be false. Many a times it happens that customer may not understand the importance of questions as well as the project. Some answers were contrast so we cant get the actual or proper decision in analysis. In our survey we had select the sampling method are convenience sampling and judgment sampling so it may not be give proper effect to survey or may not be the representative of population. Analysis is totally depend on surveyors and analyst ability. So the personal bias or inability may affect the result of the survey.
ANNEXURE
BENEFITS OF RETAILING
92

The implementation of such a retail marketing strategy yields benefits for consumers, manufacturers and wholesalers and creates economic utility as described by the following figure.
Figure 3 Benefits of Retailing The first point under retailing benefits for customers, bulk breaking refers to the act of retailers of buying goods in large quantities and then breaking them into smaller sizes for their individual customers. As a result purchases become convenient for customers - in terms of quantity bought as well as expenditures made. The assorting function is nothing but evaluating all the different products available and offering to the target the optimum array of products from which to choose. The storing function performed by the retailers relieves customers of the task of anticipating their desires too far in advance of their needs as the retailers keep goods in inventory until customers are willing to buy and use them. Further, retailers help manufacturers smoothen the production cycle by placing orders for peak demands well in advance and by managing inventory even on behalf of the manufacturer. They create economic utility for consumers by providing the products in the form and at the place and time desired by the consumer.
93

A Study On Customer Satisfaction in Marketing Management On V-Mart Mall

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Varin Commercial Pvt. Ltd.

CUSTOMETR RELATIONSHIP MANAGEMENT AT RETAIL OUTLET OF VARIN COMMERCIAL PVT.LTD. (V-MART)

In Partial fulfillment of MBA Program

Submitted By: Dhanesha Mehul R. Dadhania Nishant D.

S. K. Patel Institute Of Management & Computer Studies, Gandhinagar.

Varin Commercial Pvt. Ltd. (V-MART)

Varin Commercial Pvt. Ltd. (V-MART)

Varin Commercial Pvt. Ltd. (V-MART)

4. Why Study Retailing? 5. Test and Learn Retailing

7. What drives the industry?

Varin Commercial Pvt. Ltd. (V-MART)

Suggestions and Recommendations Limitations Annexure Bibliography

Varin Commercial Pvt. Ltd. (V-MART)

Varin Commercial Pvt. Ltd. (V-MART)

Varin Commercial Pvt. Ltd. (V-MART)

Varin Commercial Pvt. Ltd. (V-MART)

Varin Commercial Pvt. Ltd. (V-MART)

Typical Distribution chain

Varin Commercial Pvt. Ltd. (V-MART)

Retail Marketing Mix.

By: - Ron Hasty, James Reardon.

Varin Commercial Pvt. Ltd. (V-MART)

Varin Commercial Pvt. Ltd. (V-MART)

Compan y name Margin Free Markets

No. Total of sq.ft. stores 300

2002 -03 Sales(INR Millions)

Indepen Discount dent grocery Retailer chain

Food supermar ket

Plan to open14 more stores this financial year

4 more stores by the end of 2003

Varin Commercial Pvt. Ltd. (V-MART)

Company name Subhiksha

Indepen Discount dent grocery Retailer chain

No. of stores 143

Total sq.ft. 192,000

2002 -03 Sales(INR Millions)

Future plans Expand in Karnataka, Maharashtra, Gujarat and Andhra Pradesh

Varin Commercial Pvt. Ltd. (V-MART)

Shoppe Book rs Stop Retailer 51%; ICICI Venture s 49%

Wills Lifestyle Landmark Lifestyle

Hyperma rket (sells both retail and trade)

Varin Commercial Pvt. Ltd. (V-MART)

Varin Commercial Pvt. Ltd. (V-MART)

Varin Commercial Pvt. Ltd. (V-MART)

Varin Commercial Pvt. Ltd. (V-MART)

4. Why Study Retailing?

Varin Commercial Pvt. Ltd. (V-MART)

5. Test and Learn Retailing:

Varin Commercial Pvt. Ltd. (V-MART)

Varin Commercial Pvt. Ltd. (V-MART)

6. The industry Structure:

Varin Commercial Pvt. Ltd. (V-MART)

Varin Commercial Pvt. Ltd. (V-MART)

Varin Commercial Pvt. Ltd. (V-MART)

Varin Commercial Pvt. Ltd. (V-MART)

7. What drives the industry?

Varin Commercial Pvt. Ltd. (V-MART)

Varin Commercial Pvt. Ltd. (V-MART)

Varin Commercial Pvt. Ltd. (V-MART)

Varin Commercial Pvt. Ltd. (V-MART)

Varin Commercial Pvt. Ltd. (V-MART)

Varin Commercial Pvt. Ltd. (V-MART)

Eight Myths Of CRM