Page 119 - DMGT510_SERVICES_MARKETING

Services Marketing

Notes  EDLP: The pricing strategy of Central Bazaar was Every Day Low Price, meaning
that all merchandise was available every day at a one per cent discount to maximum
retail price (MRP), and unbranded goods at a five per cent discount to existing rates.
This was a competitive advantage on price that was hard to ignore.
For Central Bazaar:
Adapting to the changing demographics of family, gender, income, occupation,

education, etc. Urban India in general and Mumbai in particular, has been witnessing
perceptible shifts in its demographic profile. Joint families are giving way to nuclear
families for various reasons:
Lack of living space: With increase in family size across three generations, it was

about time for the new family to relocate itself.
Job opportunities: The new generation got a job in another part of the

megalopolis, and preferred to stay close to the work area instead of commuting.
New Bangalore was a classic case. It was fast becoming an institutional hub for
BPOs, educational institutions and, of course, IT companies.
Individualism: The new generation and the new family were reluctant to conform

to the joint family code and sought a greater degree of individual expression
in respect of food, interior décor, child rearing as well as lifestyle.

Additionally, women were joining the workforce in larger numbers. Dual income meant
not only more scope for conspicuous consumption, but also less time for leisure and
shopping. The convenience offered by online shopping was irresistible, freeing time for
leisure and self developmental activities. This new generation customers were more
educated and aware, and recognised brands and their promise better than the previous
generation. They did not feel the need to compare shopping products and were comfortable
ordering through the phone or net.
Central Bazaar felt that they were offering the market just the right kind of format,
considering the changing demographics. With the family spending more time in their
occupation, commuting, and lifestyle changes, ordering on the phone was one more of the
adaptive behaviours.
Escaping the location trap: “Location, location, location” was the call sign for any

retailer. Its decisive competitive advantage lay in the right location choice, which
brought in the much sought after footfall and took advantage of the “traffic”. Location
by defining the catchments area for the store was a strategic issue. Central Bazaar
escaped the location trap by being “accessible” 24 × 7 to all people in the designated
suburbs of Mumbai: a phone call or a “click” was all it took to order, and the
merchandise was delivered by the retailer’s vans right at the doorstep.
No inventory: Central Bazaar does not exactly escape the inventory trap, but manages

to do better than other offline stores. It has a huge godown and warehouse, where it
stocks its 5,000-brand merchandise line-up, and from which its “pickers” select the
order items. What it escapes from is expensive interior décor, visual display and
merchandising, shoplifting, etc.
Micro marketing: The delivery system enables Central Bazaar to get close to the

customer’s living environment for further interactions and micro marketing. The
sales call can become customised and the customer’s eyeball and attention can be
garnered exclusively and qualitatively for effective marketing and relationship
building.
Contd...

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