CASE STUDY

ALCANTARA. DORUELO. ILAO. LUMBRE. MARTIN. REFORMADO. TRELLIER. VIDA

TIME CONTEXT

1994
VIEWPOINT

Robert Ulrich, CEO

CENTRAL PROBLEM

Strategy that would lift

Mervyn's and the Department
store division revenue
OBJECTIVES

Must Objectives:
To formulate a strategy that would lift
each division up since the management
used the approach of The Power of One.
To increase Mervyn's and the
Department store division revenue in
2000.
OBJECTIVES

Want Objectives:
To remain as the leading retail
discount store in the U.S by
maximing shareholder value over
time.
AREAS OF CONSIDERATION

Strengths
1. Target Corp. as one of the market leaders .
2. The use of Micromarketing.
3. The Power of One approach of the management,
using the resources of each management to assist
each other.
4. Provide diversity in it's products, catering wide
range of customers' needs.
AREAS OF CONSIDERATION

5. Uses the new way of selling: Internet

shopping.
6. Proving its capabilities as a market
leader and continue growing in the
mature market.
7. Increasing the value of Goodwill over
time.
AREAS OF CONSIDERATION

Weakness
1. Poor financial
performance in two of its
divisions
AREAS OF CONSIDERATION

Opportunities
1. Broad customer base.
2. Global Expansion
3. Focus on products
AREAS OF CONSIDERATION

Threats
1. Increase competitor
pressure
2. Changes in economy
ALTERNATIVE COURSE OF ACTION

ACA #1: Mass Marketing

Advantages:
1) Reaching a large audience and the potential for
massive sales.
2) Great for overall branding and building name
recognition.
3) Less risky because it is not dependent on a small
population of consumers.
ALTERNATIVE COURSE OF ACTION

Disadvantages:
1) Difficult to track which ads are most
effective.
2) The method can be successful in one
geographical area but not resonate positively
with consumers with another.
ALTERNATIVE COURSE OF ACTION

ACA # 2: Product Development

Advantage:
1) It can help attract customers not only to
the women but also to men if they make
different products available for all types of
sex.
ALTERNATIVE COURSE OF ACTION

Disadvantages:
1) It is risky. New products come with a world
of uncertainty, introducing customers to
offerings that they may or may not want.
2) It may take time and money for huge
change and everyone must adjust to it.
ALTERNATIVE COURSE OF ACTION

ACA # 3: Restructuring and redesigning of store

interior and exterior
Advantages:
1)New design may attract customers to enter the
store facility
ALTERNATIVE COURSE OF ACTION

Disadvantages:
Disadvantages:
1) It takes time and money to reconstruct and
redesign a store. During redesigning there is no
income and customers might find another product
on different stores.
 RECOMMENDATION

ACA # 3: Reconstructing and redesigning of store interior

and exterior
Mervyn's and Department Store should consider
reconstructing and redesigning the store interior and exterior.
This will attract customers to enter the store facility and try out
the products that it sells. This innovation will make the
company have a better management for the company
operations to run smoothly. It will also correct past mistakes,
improve strategies and implement better management of the
business.
PLAN OF ACTIONS

Board of Directors approves the recommendation

of reconstructing and redesigning the store interior
and exterior as well as instructs CEO to implement
the decision.
CEO prepares a plan of actions to include the
following:
 Audit the performance and all of the assets of the
corporation.
 Review performance and recommends appropriate
action
PLAN OF ACTIONS

Evaluate employees to determine who

contributed more in the corporation and who
have to terminate.
Review pricing policy of goods sold.
Prepare an environmental scanning to
competitors.
Submit plan of actions to the Board of Directors
for consultation and approval.
Implement the plan.
THANK
YOU!