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2. LITERATURE REVIEW
Before the definition of marketing strategy profile it is necessary to review the available literature of the problems knowledge of relevant theories and previous work does should be known before getting into the field, sufficient time should be devoted in reviewing the literature that has already been published. This help in finding out the necessary data for operational purpose. Those data facilitates the operational action and are used for indicating the type of difficulties that may be encountered in the present study. Thus to conduct the marketing profile, previous report, company record and some standard text book were required to get an insight into marketing profile and strategies. These are listed a follows: Marketing management-analysis, planning, implementation and control.-Philip Kotler, 9th Edition, Marketing management-C.N. Santakki Second edition. The made-in is considered by Dichter (1962) as the fifth element of the marketing mix, and is defined as the country where are located the corporate headquarters of the organization doing the marketing of the product or the brand (Johansson, Douglas and Nonaka, 1985). The country of origin carries a rhetoric that influences consumers preconceptions towards the products of a country. Its meaning can be conceived as an indication serving as a basis of evaluation (Bilkey and Nes, 1982), when one considers a product as a bundle of information. A tendency to evaluate positively the local production compared to imported production, and biases in favor of industrialized countries have been found in previous studies (Bilkey and Nes, 1982; Cordell, 1992). This does not mean the consumer will not buy the product, but rather that he is not inclined to do so (Schooler, 1971).When entering foreign markets, sellers often face quotas, tariffs, and non-tariff barriers. Considerable attention has, for example, been devoted to examining how the value embodied in a brand and its equity can be extended to other products without resulting in dilution of value (Aaker and Keller 1990). This interest has been stimulated in part by the increasing market power and value associated with a strong brand and in part by the prohibitive costs of launching a successful new brand.
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3.2
During the study, the main focus will be pointing out the answers of some particular questions. Mainly focused questions are the followingsi. ii. iii. What are the main influencing features for BATA consumers to purchase shoes? What is the perception of BATA brand among consumers? How BATA can improve the consumers perception with new marketing strategies?
3.3
We had visited Rampura branch of Bata to prepare our report. We went to 50 regular customer and officers of Bata at Rampura branch who visit at least once in a year, to gather data about our study and producer because of our time limitation. As a human being it is not possible to go all the customers. We got chance to communicate with the customer of Rampura branch of Bata
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We got chance to know about the image of Rampura branch of Bata according to their customers. We got experience to do survey.
LIMITATIONS OF THE STUDY For my time limitation we cant study every marketing strategy, thats why we have selected some of strategies. They didnt have enough time to spend with us and confidenciality. For their privacy, they didnt give our some questions answer. They didnt want to communicate with us in a proper way.
3.4
BROAD OBJECTIVE
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Marketing Profile of Bata Shoe Co. Bd. Ltd. Organization and family were invited to return to the Czech Republic, where Bata had remained a symbol of national pride and achievement.
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Marketing Profile of Bata Shoe Co. Bd. Ltd. brought new designs too according to the taste of the people. Bata expands its operation all through the country. It has now huge number of stores, agencies, dealers and wholesalers around the country. And undoubtedly it has the biggest shoe manufacturing and marketing organization here in Bangladesh. There are hardly any places in the country where one will not found Bata store, which signals its expansion, success and popularity here. Bata Bangladesh is a public limited company, which has 51- 49% share with the government of Bangladesh. Though it has established in Czechoslovakia but at present Bata is a Canadian company because of the migration and mergers of the family and now J. Bata who happens to be the grandson of founder G. Bata has his operation and headquarter in Canada and operates as a Canadian company. In Bangladesh it is operating as a Canada-Bangladesh company. Bata has two factories in Bangladesh from where it produces all kinds of shoes. One of which is at Tongi and other one at Dhamrai. The second factory at Dhamrai has state of the art technology and facility with leather treatment to leather processing to waste treatment plants, which is the only one of its kind in the country. Bata Bangladesh produces daily around 80,000 pairs of shoes of various descriptions in its two manufacturing units located at Tongi and Dhamrai. It has a modern Tannery with the latest technological facilities to process approximately 19,000 square feet of leather daily, which comprise a wide range of products and finishes. The Tannery is also equipped with a modern effluent treatment plant to ensure a pollution free environment. The Companys marketing network is consolidated through its own retail outlets, distributors, franchises, agencies, wholesale depots and a large number of registered distributors and dealers.
CHANNELS OF SALES:
RETAIL AREAS NUMBER OF RETAIL OUTLETS WHOLESALE DEPOTS TOTAL NUMBER OF DEALERS : : : : 30 350 20 1200
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Vision:
To provide good quality shoes at an affordable price. By keeping in mind the comfort that needs to be there and providing new designs with it.
Objectives:
Achievement of 100% estimated business in each category Maintain a shoe line with 700 lines of which 200, 300, 150 & 50 lines for Men, Women Children & Plastic respectively. Introduction of a shoe line as per life style as well as fashion trend. Achieve an average 55% margin in each category Innovate ideas or system for better management of merchandise distribution by maintaining 4 times stock turn.
Strategies:
Penetration to new & targeted market segments through introduction of shoe lines as per life styles with supportive promotion activities Defined number of lines, assortment & quantity for each store according to merchandise classification & store profile in order to increase efficiency in distribution. Identification of loopholes in cost structure to increase production efficiency. Detail analysis of price points of entire shoe line in order to achieve maximum margin. Detail analysis of departmental work flow & bringing necessary changes for efficiency better coordination with other departments.
Marketing Profile of Bata Shoe Co. Bd. Ltd. throughout the country and in overseas markets such as USA, UK, Europe, Middle East, etc. The company also markets a range of sports shoes, garments and accessories manufactured by others. Footwear sales account for more than 97% of the total revenue. Rubber and canvas footwear contributes 48% of volumes, leather footwear contributes to 30% and plastic footwear accounts for 22% of volumes. In value terms, leather footwear contributes to 58% to turnover, Rubber and canvas footwear contributes 27%, plastic footwear accounts for 12% of total turnover. Accessories, garments, etc account for 3% of turnover. Bata manufactures around 50% of its footwear in its own units, while the rest is outsourced. from small-scale manufacturers. While all the plastic footwear is outsourced, in leather company manufactures 63% of the footwear in-house and in rubber and canvas footwear, 61% is manufactured in-house.
Own:
Bata Bangladesh has two factories in Tongi and Dhamrai. All the rubber and related production has been done in Tongi factory. Every type of leather products are been manufactured in the Dhamrai factory. About 92% of all Bata products are produced in these two factories.
Satellite:
There are some satellite production factories which produces solely for Bata with the production facility, which has been, step up by Bata Bangladesh. 4% of Bata production is from satellite sources.
Outsourcing:
As related and supporting industries are growing in shades of the massive structure of Bata Bangladesh. It also does outsourcing with different small shoe industries mainly from the Dhaka region. The quality and the specification has been ensured by the Bata people. The participation of outsourcing in the companies business is 4%.
Import:
With high import duty it is hard for Bata to import a substantial amount from different subsidiaries and other outside suppliers. It can be mentioned that the duty for importing complete shoe here in Bangladesh is 101%. Even 10 | P a g e
Marketing Profile of Bata Shoe Co. Bd. Ltd. though Bata Bangladesh import shoes to keep up with the market trend, which is around 1% in every year.
The functional objective of the wholesale marketing manager is to monitor and planning of wholesale market operation of Bata Bangladesh, which also is a very important sales channel of the company.
Marketing Profile of Bata Shoe Co. Bd. Ltd. managers on in Tongi and other in Dhamrai. They are controlled by the director of production. They are responsible for directing, coordinating and controlling the overall production activities means from the purchasing raw materials to transferring those into complete shoes. The function of production manager is to assist the director of production in achieving the production target for a specified period. The function of planning and supply manager is material planning, production planning etc.
Finance Department:
To maximize the interest of the shareholders of Bata Shoe Co. (BD) Ltd. To allocate the fund in a proper way that minimizes its cost and maximizes its profit. To ensure conductive financial climate of the company. To ensure sound management of the administrative staff and financial matters of administrative staff and selection grade employees.
Company Secretariat
To ensure the best selection, placement and utilization of the administrative staff within the company. To ensure discipline, mutual coordination, smooth communication among the administrative stuff and thereby peaceful corporate environment. To provide sufficient training and opportunities to the administrative stuff to improve their skill and efficiency for the well being of the company. To ensure proper management of the financial matters of selection grade administrative stuff.
Accounts Department:
To ensure conducive financial trend of the company. To ensure sound financial plan in terms of raising and allocation of funds and thereby maximizing shareholders interest. To prepare Annual Financial Plan of the company in terms of both procurement and allocation of fund. To maintain books of accounts, cost and financial accounts of the company as per the requirement of law and group head office. To manage the assets of the company. To provide financial information and report to the top management for decision making purpose.
Internal Audit Department: To provide reasonable assurance of adequate and effective process of internal control and functioning effectively such that assets are safeguard, proper accounting records are maintained, financial information used within the business or for publication is reliable. 12 | P a g e
Marketing Profile of Bata Shoe Co. Bd. Ltd. To confirm transparency in all auditable entities. Pre-audit: To carry out all operational checks. Post-audit: Conduct internal control review, physical verification on various audit universes. Investigation: Conduct thorough review in any specific area of audit universe as desired by the authority of the concerned audit entity. Development of procedure manuals.
MIS Department:
To coordinate and supervise data entry for the accounting and payroll package. To update product cost and product profitability from time to time. To arrange repair and maintenance of the computer hardware. To provide necessary support and help to the computer in their day to day function To prepare the monthly statement of Advanced Sale Invoice.
Quality Assurance:
To ensure that the end users receive medicines those are safe, effective and quality consistent with leadership position in the health care industry throughout the country. To apply the principles of customer-focused quality, service and excellence to all processes and system, from product design, development through production, distribution and marketing. To maintain the standard of quality in order to protect the patients, prevent errors and optimize value provided to the consumer and company. To comply with group product standards and regulatory requirements.
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HR HR Manag er
Wholesale Manager
Merchandisin g
Manager
MIS Manag er
Export Manag er
Plant Manag er
Merchandisi ng Officer
Costing Officer
Progra m Officer
Exp. Suprvis or
Dept. Manag er
Shop Manag er
Area Distribut Manage or r Figure:1 Organogram of Bata Shoe Co. (Bd) Ltd.
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TECHNOLOGICAL FACTORS:
Due to vast improvements in the information technology systems, 'Internet' has posed itself to be new media to reach the consumers. Realizing the need and the opportunity Bata Bangladesh has already set a state of the art facility in Dhamrai. All the leather products that they made here in Bangladesh are made there. They provide new forms of technological improvement where MIS department monitor their whole operation. The POS system in the wholesale depot is also a positive step towards good use of technology in the survival and competition in todays business.
Marketing Profile of Bata Shoe Co. Bd. Ltd. In Bangladesh, political turmoil like hartal, strikes etc. are a serious barrier in the smooth functioning of a company. However, Bata Bangladesh is able to take some positive outputs from political factors. As they are 100% taxpayers to Bangladesh government, they must able to make understand the politicians the importance of FDI in the country. Therefore, Bata Bangladesh can get some benefit from political factor as well.
ECONOMIC FACTORS:
Per capita income is increasing. Shoe industry is growing with the increase of urban population and income level. Currency rates are fluctuating which influence the cost of procurement of raw materials from external sources.
Marketing Strategy: Achieving maximum Positive differentiation Over competition in meeting Customer needs. Corporati on Social Environme nt
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Key Elements of Marketing Strategic Formulation Figure: 2 Key elements of marketing strategic formulation
Bubblegummers:
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Marketing Profile of Bata Shoe Co. Bd. Ltd. The Bubblegummers brand of Bata serves the infant to children, according to them 0-13 years of age group. Bubblegummer brand has provided Varity of design and type of shoes for above-mentioned age group of children.
Marie Claire:
The Mari Clare brand of Bata is for women. It has more than 100 designs and has different price range of shoes. The price range here starts from Taka 450. In recent times Bata has targeted the young working women who wants reasonably priced, decent design and durable shoes for work and this brand in many cases serves this segment well.
Sandak:
What we called is Sponge Sandle is professionally called as Thongs. Sandles of Sandak brand of Bata serves that very segment of the market. It produces different types of very good quality plastic and Thongs for women. From my survey it has found that it is the most popular shoe of Bata. The pick seasons for Sandak shoes are rainy season when many prefer this shoe, which are washable and decent in looks.
Power:
This is a reasonable priced good quality sports shoes and sandle shoes for young male and female. The target segment of Power is teenagers and some parts of the elderly people who need sneaker for walking purpose. The price range starts from 695/- and in many cases not exceed more than thousand taka. According to the buying power this price range is very popular with the general public as durability comes with it as with every Bata footwear.
KingsStreet:
The most famous dress shoes of Bata come under the brand name of KingsStreet. It has been nice to know that this brand of shoes has been solely made in Bangladesh. The Dhamrai factory of Bata has the machinery to make these shoes, which they established in 1999 at a cost of 1 core taka. These shoes have different price range for different segments of people.
Weinbrenner:
This brand of Bata provides trendy, outdoor, rough use footwear for men. This is also a popular brand with the youth of the country. Though the brand is not that cheap but the quality of it is very good. 18 | P a g e
Marketing Profile of Bata Shoe Co. Bd. Ltd. Apart from these Bata has numbers of leather sandles of various designs, sandle-shoes under Bata brand name that serves different segment of the market. Bata also manufacture and market popular brands such as HushPuppy, Dr.Scholes in this region of south Asia. Bata also have quite new brands for male and female like Bata Comfit, Bata Flexible. According to the Bata officials in Bangladesh Bata have more than 1000 lines of footwears here in Bangladesh at present. Thus Bata's well known brands include Power, Bubble-Gummers, Marie-Claire, Hawai, Naughty boy, Sandak, North-Star etc. International brands such as Hush Puppies, Nike, Lotto, and Dr Scholl are sold under manufacturing and licensing agreements. The company has more than 1000 shoe designs and caters to all the segments. Over 60% of sales come from the men's range, while children's and womens range account for about 20% each. In women's segment the Sundrop range of casual ladies wear in the popular range has done well in the market and registered a strong growth of 500% in F12/2000. The brand is being endorsed by filmstar Rani Mukherjee. Bata also markets sports wear, readymade garments, hosiery, and other footwear accessories like socks, shoe polish, etc. The company also exports its products to countries like Germany, Australia, USA, UK, Holland, Denmark, New Zealand, France and Canada. It exports about 4mn pairs of shoes in a year.
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Marketing Profile of Bata Shoe Co. Bd. Ltd. Table 1: Different Product Category and Best Selling Sizes
PROMOTION:
Promotion strategies are concerned with the planning, implementation, and control of persuasive communication with customers. Clear-cut objectives and a sharp focus on target customers are necessary for an effective promotional program. As Bata is a established brand here in Bangladesh they think that they should go on with more and more retail outlets rather than intense advertising. So they limit their advertising into following places: Billboards Adds on local newspaper Some promotion together with other established brands
DISTRIBUTION:
The physical distribution starts when the raw materials send to the factory and the manufacturing process starts there in Tongi and Dhamrai factory. From there the end products send to the CDC (Central Distribution Center) in Tongi factory. After they receiving the end products then and their the packaging has been done and according to the requirement of different stores, Agencies, dealers and wholesalers the goods has been transferred directly to the distributors through company owned vehicle. There is separate process for own agencies and stores against the wholesalers and dealers. The goods for agencies and stores gone straight to the store headquarter and goods for others gone to the 13 depots around the country from where they collect the goods. In retail, BB operates through a chain of exclusive own and franchise stores. BB's stores are located in prime locations countrywide. 70% of Bata's sales are from its own retail outlets. Besides there is a network of about 500 exclusive wholesalers who service about 300 retail stores all over the country. Bata has showrooms, wholesale depots and distribution centres across the country. BB's major thrust is on middle-class and upper class customers. The concept of `budget stores` has been introduced to remove apprehension in the minds of customers who viewed Bata outlets as being expensive. The company is focusing on the rural markets for volume growth in the low-priced footwear segment.
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Dhamrai Factory
Depot
Products tend to go through different stages, each stage being affected by different competitive conditions. These stages require different marketing strategies at different times if sales and profits are to be efficiently realized. The length of a product life cycle is in no way a fixed period of time. It can last from weeks to years, depending on the type of product. In case of shoe industry in Bangladesh it is presently going through the growth stages which are characterized by many new consumers entry in the market, by fall in price as 22 | P a g e
Marketing Profile of Bata Shoe Co. Bd. Ltd. experience and economies of scale have been attained, by developed distribution channel and by increasing intensity of competition.
Introduction
Growth
Maturity
Decline
Marketing Profile of Bata Shoe Co. Bd. Ltd. SUPPLIERS Rubber from local source, leather from local source. Some sole from other subsidiaries of Bata like India and China BUYERS MAJOR COMPETITORS Apex, Independent sellers, Reebok, Liberty Smuggled shoes Infant, teen, young, old. Lower- middle to upper class
Figure: 5 Five forces of competition for Bata Shoe Co. Bd. Ltd.
Bargaining power of buyers is increasing day by day as new shoe companies with optimistic future plan and changing trend and quality consciousness in increasing day by day. People want durable shoes as well as modern designs. So to satisfy the customers the companies have to keep up with the trend as well. The entrance of foreign brands like Nike, Reebok doesnt make the scenario easier. So one have to say that the competition is just heating up in the shoe industry. No one can take easy even the establish brand like Bata who have more than 35 years of experience in Bangladeshi market. So they must aware of the situation and work and take steps accordingly.
Threat of substitutes:
One cant think of much substitute of shoes. There are not too many bare footed people now days. At least they wear a sandal. So the threat of substitute is not that much.
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Marketing Profile of Bata Shoe Co. Bd. Ltd. Though Bata has enjoying quite a good market share and know the market for long the market competition is intensifying day by day. In the decade the only worry for Bata was independent sellers who have the minimal establishment costs and in many cases sale shoes of high quality of minimal cost or poor quality shoes. But the situation has been changed much since now not only the independent sellers but also the regional and world famous brands are now in Bangladesh. So the competition has now much more intense. Bata Bangladesh has to think both of their old threats as well as new competitors who has much more organized structure than the old competitors.
Weaknesses:
Insufficient promotional activities Bata at present conducts all the store management activity manually. This results lots of lengthy paper works, errors & waste of time. Inability to catch the present trend in time Less competitive price due to high cost structure. VAT & tax barrier
Opportunities:
Despite political turbulence a segment of our middle-class is coming up with reasonable buying power. Many of them are women who are decision maker so the city store concept of Bata can attract them as whole of the family footwear can be available there. Consumer like differentiated products. They like to shop in a store where they serve the whole family. More competition results in more campaign for products. Business Expansion in Shoe care products Utilize outsourcing especially the synergy sources to achieve competitive pricing Franchisee opportunity with global brands like Nike, Reebok, Hush Puppy 25 | P a g e
Marketing Profile of Bata Shoe Co. Bd. Ltd. Market expansion opportunity in high fashion & value for money footwear market for all categories of shoes through Retail & WCSM channels
Threat:
Political instability affects the supply of raw materials and distribution of finished products. Uncontrolled counterfeit of Bata products New companies like Apex, Homeland, Pagasus of Bangladesh and the foreign companies like Nike, Reebok, Addidas are already in the market with good quality product. Have to keep up with them respect of quality. Smuggelling of shoes and many stores in the city like the ones in elephant road are the major market leaders. As they dont have to pay for large amount of money for establishment, production, quality and advertising so they can sell at a much lower price than established brands like Bata. Rapid market expansion program by organized competitors like APEX.
Most of their shoes are expensive. They dont provide any school shoes. The sports shoe they bring into the market are mostly imported Addidas shoes and quite expensive. In the mens section the most dominating color is black, in women section-black and chocolate. They provide sophisticated color shoes for children. The most dominating sizes of the men, women and children are the average sizes that are sold in any Bata store. They remain open on everyday of the week except any government holiday. Opening hour is 9:00AM-10:00PM. They generally implemented new design after every 6 months according their employees. The most successful sales campaigns are 60% off on specific design. Their market share is about 1.50% in Bangladesh.
LIBERTY:
Here in this shoe stores the average price of the shoes are also expensive. Their average retail price is 600+. They also have the same kind of offerings in their respective divisions. Usually the normal color and size that are sold elsewhere are also sold here. They remain open everyday except of any government holidays. They open at 10 in the morning and remain open up to 10 in the evening. After 3-6 months they brought new design shoes in the market. The most effective sales campaign is 40-60% discount on specific design shoes. The market share of Liberty shoe is about 1%. They are in the market for about 13 years as a franchisee they are from India.
REEBOK:
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Marketing Profile of Bata Shoe Co. Bd. Ltd. They only sale sports shoes and some children shoes who are in their teens. The price of all shoes is high 1200+. The color and design of their shoes are of high quality. Reebok brings different types T-shirts, tracksuits and non-shoes items, which are quite expensive. After every 1-2 months new design of shoes comes in their store. 20-25% discounts on specific design are their most effective sales campaign. About .10% market share Reebok is quickly gaining ground and getting attention of the brand conscious segment of the country.
NIKE:
Same as Reebok, Nike only offers high quality sports and some children shoes. Their shoes are also expensive sports shoes ranging from 2000-5000, which are sold most. Best-sold non-shoe items such as T-shirt, tracksuits are ranging from 750-2250 taka. They open their store everyday of the week. They brought new design in the market after every 3 months. They dont have any sales campaign up to now. Same as Reebok but their market share is less than their international rival as they have enter Bangladesh market for 6 or 7 years.
WOODLAND:
Trendy high quality shoes for all. They dont provide school shoes. Dust, Brown and Green are their dominating color in every category. They have lots of nonshoes item like T-shirts, trousers, and shoe polish. The most popular price ranges among those are 695-1395 taka. They open everyday from 10:00-9:00. It brings new design in after 3-4 months. The effective sales campaign is same as Reebok. Very good quality trendy shoes which quickly gaining ground in the country. This is the same company that brings Reebok in the country as franchisee.
PAGASUS:
They made their name as sports shoe manufacturer. After that they come up shoes for both the male and the women. Their best-sold price range is 800-1200 for men, 550-750 for women and 300-500 taka shoes for children. Their best sold sports shoes are ranging from 700-900 taka. They open their store everyday from 9:00-10:00 in the evening. After 2 months they bring out at least some kind of new design in one of their segments. Most effective sales campaign up to 20% discount. Their market presence in the country is over 25 years but not doing that well. Market share is only .50% mainly the quality of the shoe is moderate.
HOMELAND:
It is the least known brand among buyers. No non-shoe items. Open everyday9:00-10:00PM in the evening. On average bring out new design after2-3 months. Discount up to 20% on specific design are their most effective sales campaign. It is a Bangladeshi company. Not too many people know them but 27 | P a g e
Marketing Profile of Bata Shoe Co. Bd. Ltd. they are in market for more than 10 years. There main lacking is their poor distribution channel. Only 15-20 stores in the country is the indication of it.
INDEPENDENT HIGH:
It is most popular among buyers. They are the type of seller who usually sold relatively high priced imported shoes. Mens best-sold price ranges are14001750 taka, womens 600-750 taka, no school shoes but have childrens shoes 320-400 taka. They remain open everyday form 10:30-10:00PM at night. They dont provide any kind of sales campaign, as all of them are bargain stores. They are named as the elephant road shoe market. They have good market share more than 15% and holds a preference in the general peoples mind. Though sometimes they bring some new designs but that is slow and the quality of the shoe is also moderate.
INDEPENDENT MEDIUM:
These types are stores are of plenty in the elephant road area. Theyre usual best range for mens shoes are 500 -600taka, 200-400 taka for women, and 100250 taka shoes for children. They have no school shoes and non-shoe items. Dominating color and sizes are the same as Independent highs. Their opening hours are same as highs. Implementation new design happens after 3-4 months. They hold a major market shares. The bargain price of them attracts people. The quality of their shoe is not up to the standard in many cases. Low establishment cost, no promotion cost makes them sell shoe at a very low cost.
COMPETENCIES/STRATEGIES
OF
BATA
Be obsessed with customer satisfaction; Build reputation for providing quality product; Be dedicated to continuous growth in the market; Widespread availability of Bata shoes in the market; The prices of Bata shoes are very competitive and in many cases lower than its competitors; Very good distribution channel with dedicated employees all through Bangladesh and established because of Batas experience in the Bangladesh for very long; Taking opportunity of the lower buying power of the people of the country by providing good quality shoe at a competitive price;
Among the three choices Bata has chosen and uses Total-Market strategys they serve all classes of people with their shoes ranging from 30/--2195/-. The specifics of the strategy is provided belowDefinition: Serving the overall market with one or some other kind of offerings. Objective: To diversify the risk of serving only one market. Requirements: Carefully selecting all the segments and providing offerings to all. Avoid confrontation with companies serving the entire market. Expected Results: Higher Sales. Higher Market Share.
Among the market-Geography Strategies Bata Bangladesh follows the 'NationalMarket Strategy in Bangladesh as they distribute their product to the whole of Bangladesh using their own and Danish's distribution channel. Though it is a MNC it operates quite freely here in Bangladesh and operates as NationalMarket Strategy. Definition: Operating nationally. Objective: To seek growth. Requirements: Top management commitment. Capital Resources. Willingness to take risks. Expected Results: Increased growth. Increased market share. Keep up with competitors
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Among the Market-Entry choices, Bata Bangladesh uses First-In strategy which is characterized by the following: Definition: Entering market during the introduction stage. Two modes of entry are feasible: Conventional marketing strategy Initiator- Entering market with unconventional marketing strategies Objectives: To understand the market first and reap the profit at the beginning and waiting for the competitors and strike them with good lowering price and improved quality. At the same time it offers variety of products. Requirements: Market research ability. Production capability. Expected results: Putting market on a new growth path. Increased profits. Some growth opportunities.
Market-Dilution Strategy:
1. 2. 3. 4. De-marketing Strategy Pruning-of Marginal Markets Strategy Key Markets Strategy Harvesting Strategy
Among the market-dilution strategies, Bata Bangladesh uses kind of harvesting strategy in many cases. They also come up with the key markets strategy. Definition: Focusing on overall market and take out the invested profit. Objective: To serve the market well where they are now.
Requirements:
Gain continuous knowledge of the local markets. Concentrate all energies on these markets. Develop unique strategies to serve the chosen markets.
Expected results:
Increased profits. 30 | P a g e
Marketing Profile of Bata Shoe Co. Bd. Ltd. Increased market share in the selected markets.
Among the product strategies Bata Bangladesh has used 'Product-Positioning Strategy' and 'Diversification Strategy' which is characterized by the following: Product-Positioning Strategy: Definition: Placing a brand in that part of the market where it will have a favorable reception compared with competing brands. Objectives: Position product in market so that it stands apart from competing brands. To position the product so that it tells customers what you stand for, what you are, how you would like customers to evaluate you. In the case of positioning multiple brands: To seek growth by offering varied products in differing segments of the market. To avoid competitive threats to a single brand.
Requirements: Use of marketing mix variables (design and communication efforts). Successful management of a single brand requires positioning the brand in the market so that it can stand competition from the toughest rivals and maintaining its unique position by creating the aura of a distinctive product. Successful management of multiple brands requires careful positioning in the market so that multiple brands do not compete with nor cannibalize each other. Thus it is important to be careful in segmenting the market and to position an individual product as uniquely suited to a particular segment through design and promotion. Expected Results: Meet as much as possible the needs of specific segments of the market. Limit sudden change in sales. 31 | P a g e
Marketing Profile of Bata Shoe Co. Bd. Ltd. Make customers faithful to the brands.
Distribution Strategy:
Definition: Developing unfamiliar products and markets through Concentric diversification (products introduced are related to existing ones in term of marketing or technology), Horizontal diversification (new products are unrelated to existing ones but are sold to the same customers), and Conglomerate diversification (products are entirely new).
Objectives: Diversification strategies response to the desire for Growth when current products/markets have reached maturity, Stability by spreading the risks of fluctuations in earnings, Security when the company may fear backward integration from its major customers, and Credibility to have more weight in capital markets.
Requirements: In order to reduce the risk inherent in a diversification strategy, a business unit should Diversify activities only if current product/market opportunities are limited, Have good knowledge of the area in which it diversifies, Provide the products introduced with adequate support, and Forecast the effects of diversification on existing lines of products. Expected results: Increase in sales. Greater profitability and flexibility.
For new products: Skimming Pricing Penetration Pricing At times Bata Shoe Company in Bangladesh used 'Penetration Strategy' which is characterized by the following: Definition: Setting a relatively low price during the initial stages of a products life. Objectives: To discourage competition from entering market by quickly taking large market share and by gaining cost advantage by realizing economies of scale.
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Marketing Profile of Bata Shoe Co. Bd. Ltd. Requirements: Products must appeal to a market large enough to support the cost advantages. Demand must be highly elastic in order for firm to guard its cost advantage. Expected Results: High sales volume and large market share. Low margin on sales. Lower unit costs relative to competition due to economies of scale.
When the products of Bata Bangladesh were established in the market they used 'Maintaining the price Strategy' which is characterized by the following: Objectives: To maintain position in the market place (i.e. market share, profitability, etc.). To enhance public image. Requirements: Firm's served market is not significantly affected by changes in the environment. Uncertainty exists concerning the need for or result of price change. Firm's public image could be enhanced by responding to government requests or public opinion to maintain price. Expected Results: Status quo for the firm's market position, Enhancement of the firm's public image.
Marketing Profile of Bata Shoe Co. Bd. Ltd. 6. Price-Leadership Strategy 7. Pricing Strategy to build market Share Among the price-flexible strategies, Bata Bangladesh uses the 'One-Price Strategy' and the 'Pricing Strategy to build market Share ' which are characterized by the following: One-Price Strategy: Definition: Charging the same price to all customers under similar conditions and for the same quantities. Objectives: To simplify pricing decisions. To maintain goodwill among customers. Requirements: Detailed analysis of the firm's position and cost structure as compared with the rest of the industry. Information concerning cost variability of offering same price to everyone. Knowledge of the economies of scale available to the firm. Information on competitive prices; information on the price that customers are ready to pay. Expected Results: Decreased administrative and selling costs. Constant profit margins. Favorable and fair image among customers. Stable market. Pricing Strategy to build market Share: Definition: Setting the lowest price possible for a new product. Objectives: To seek such a cost advantage that it cannot ever be profitably overcome by any competitor. Requirements: Enough resources to withstand initial operating losses that will be recovered later through economies of scale. Price-sensitive market. Large market. High elasticity of demand. Expected Results: Start-up losses to build market share. Creation of a barrier to entry to the industry. Ultimately cost leadership within the industry.
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Of all the promotional strategies Bata Bangladesh as we observed followed the selling. At least their lack of advertising in the electronic and print media and their target of coming up with new stores reflect that. They try to be at the doorstep of people with their store rather than intense advertising. But they give some ads to the newspaper on their new arrivals sometimes.
Bata shoe company Bangladesh Ltd. uses both direct (i.e. they deliver directly) and indirect (i.e. through a distributor) distribution strategies. The distribution channel of Bata has already described earlier.
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Bata companies have a tradition of being good corporate citizens and seek to contribute to the well being of the countries and communities where they operate. Bata companies conduct themselves as positive and contributing members of any community in which they operate, and seek to provide employees with a safe and healthy working environment. Bata companies are committed to ensuring that operations are conducted ethically, and in compliance with applicable local laws and regulations. Bata Bangladesh is also concern about the environmental safety related issues. So it has established of its own an Effluent Treatment Plant (ETP) in its organization premise with a huge investment. The Bata Environmental Mission Statement is: To protect our people, customers and communities and to protect our natural environment in order to help sustain human development globally. 35 | P a g e
Marketing Profile of Bata Shoe Co. Bd. Ltd. In the implementation of this mission, international guidelines have been developed in the areas of environment, health and safety. The efforts and achievements of Bata companies have been recognized in many countries, by both local and international bodies. The contribution to environmental conservation includes a role in prevention and education. Bata companies have long standing relationships with groups that have helped several generations of young people become more aware of the need for protection of the natural environment.
CONCLUSION:
From the analysis of Bata Shoe Company Bangladesh Ltd and the shoe industry we have identified that the shoe industry is growing and identified their main weakness is insufficient lack of development with the rapid changing market needs, insufficient promotional activities, and downward trend of quality. On the other hand, distribution system and vertical integration are the strengths of Bata From strategic marketing viewpoint; we see that Bata is taking corrective steps in almost all the way. In very few sides Bata has lacking. Based upon these facts recommended strategies would assist in more growth of Bata shoe company Bangladesh Ltd. in among the upcoming fierce competition in the shoe industry.
RECOMMENDATIONS:
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Marketing Profile of Bata Shoe Co. Bd. Ltd. Give sales discount and free samples to influence more sales in the growing shoe market. Reduce the price level. More advertisements should be aired. Should build awareness among the potential users of this type of footwear product. Bring more design, color, and design combination to be competitive. To merge with the local companies and to expand more segmentation.
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