The scope of this assignment is to collect information and learn about macro environmental factors that influence in organization and to elaborate its Marketing Decision Making in last 12 months and also for its Future Decision Making.
2.0 INTRODUCTION OF NILGIRIS SUPERMARKET
I have chosen Nilgiris Supermarket, which is familiar retail shop in South India. The origin of Nilgiris was started on 1905 with a small outlet at Bangalore. Based on different marketing strategies and quality of products given to customers made Nilgiris a successful Supermarket in South India. As a result they spread their branches throughout South India to satisfy the needs of the customer.
According to my views, the major selling product in Nilgiris is fresh vegetables with hygienic and superior quality. To satisfy the needs of the customer, Nilgiris Cultivate and harvest the vegetables in its own firm.
It sells products by its own brand name ‘Nilgiris 1905’. These vegetables are cultivated and harvested in hygienic environment. According to customers shopping experience, Vegetables from Nilgiris are provided with freshness and superior quality at reasonable price. General retailer ideal cycle is buying vegetables from farmers and delivers it to the customers through stores and process distribution centre.
3.0 MACRO ENVIRONMENTAL (PEST) ANALYSIS
It involves PESTEL analysis that affects organization based on several factors. I would like to elaborate the factors influence in decision making of Nilgiris organization on PEST analysis. Generally the term PEST means
P – Political factor involves the administration activity by the Government.
E – Economic involves economical position of organization like income and growth.
S – Social Cultural involves income distribution
T – Technology involves innovation and promotion of products.
3.1 POLITICAL ENVIRONMENT FACTOR
In Macro Environment factors, the first one is the political environment. Generally the Organization market feedback is produced based on political factors. It influences the government decision making and control the business laws for the public serving companies.
The license can be issued by the government, if the companies are following their rules and regulation up to their standards and satisfying needs and wants in different sectors such as Medical, Restaurant and Super market.
I would like to illustrate an example to show that how the political environment factor influenced in the Nilgiris.
In South India, the Nilgiris shop was closed for a month because of the local farmers, traders and retail vendors created a problem that Nilgiris was selling its own products directly to the customers in a lower price, which affects their business. As a result of this problem, Nilgiris changed their retail policy and stopped doing their business with the problem making vendors.
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Because of this issue, there was a huge demand of products in the market, so the government directly involved in this issue and implemented an act on the farmers and supermarket firm to maintain a good relationship between them. The government formed the committee that organization can have a direct contact with farmers by employing them, and farmer who is not willing to join the organization can sell their cultivated vegetables under government firm called “ulavar santhai”.
As a result of this rule, the supermarket has started their business with the government support and has regenerated the shops and started their trading vegetables with the farmers support. So, thus the customers purchase fresh vegetables from Nilgiris at reasonable prices.
3.2 ECONOMIC ENVIRONMENT FACTOR
The Economic environment factor denotes that involves in the income and economic growth of the organization. This factor plays a vital role in the marketing environment when needs of the customers increases day by day, the value of the product simultaneously increases day by day. In today’s scenario the world market is completely based up on the advertisement done by the organization to promote the product.
According to my views, i will illustrate an example to show that in today’s life how the macro environment factor affects the economic world. In today’s market, the price of vegetables is too high because of the intermediaries. So organizations like Nilgiris were listing low prices particularly on vegetables, because Nilgiris had a direct contact with the farmers and purchase the vegetables at cheap cost. Nowadays farmers are selling vegetables without aid of any agents and they are implementing farm-fork theory on exchanging of goods and services.
By this Farm-Fork theory, Nilgiris forming work opportunity to many farmers and affords guidance about cultivating vegetables without any sort of pesticide.
3.3 SOCIAL/CULTURAL ENVIRONMENT FACTOR
This factor involves social responsibility in the society, where society must aware about the increase in the vegetable price. It is the duty and responsibility of each and every organization to be keen on the focus of social responsibility. Each and every organization should take proper precautionary steps to bring down the prices by giving employment opportunities and motivating them by providing proper remuneration rewards.
It is not only task of the organization to employee a farmer and get the benefit out of him. The organization should also teach the illiterate people about the importance of agriculture and for upcoming younger generations.
I would like to illustrate an example that in South India, harvesting vegetables is very hard because of the bad weather and natural disaster, the crops will be damaged and farmer has to face loss in their investment. So the farmers cultivate vegetables according to seasons and maintain superior quality in vegetables and all are handpicked from mountains and kept in cool and hygienic places.
These are the following factors where the organization consider for their employee
Nilgiris helping students to educate from government school to corporation schools based on their performance in school, which aid through lions club and education trust.
Nilgiris provides medical benefits and to the employee and to their family members
Farm to Folk hypothesis model
Farm to Folk hypothesis model means buying vegetables directly from farmer instead of passing through mediators. The agents will get commission from both side and increase the price of vegetables. To avoid this farmer must have direct dealing to retail stores.
FARM – TO – FOLK MODEL
Agriculture market yard
Processing & Distribution Centre
3.4 TECHNOLOGY ENVIRONMENT
Technology appliances are mostly used in retail shop and are growing frequently. In today’s modern economic world online shopping plays an vital role. The technology makes human life simpler, more compact and luxuries. The technology consists of more tools such as tractor, billing machine, recycling chain are implemented in harvesting and cultivation.
I would like to illustrate an example to show that how the Technology environment factor influenced in the Nilgiris.
They are implementing electronic point sale tool on retail shop to collect data, stock controls, price variation and set up current trading statement.
They implement electronic funds transfers tool used for money transferring from consumer to trader instead of paper works.
4.0 FUTURE MARKETING DECISION OF NILGIRIS
Retail management is changing fast and environment is growing rapidly. The main factor occurred due to technology developments, political issues, social and cultural approaches and economic factor.
The future decisions of Nilgiris are as follows:
In next two years, Nilgiris planning to open 45 retail shops in South India and focusing to attain product sales of 200 Cores by 2012.
They are planning to involve thousands of farmers in agriculture for harvesting and cultivating vegetables for customer sales in the stores. Already Nilgiris placed hundreds of farmer in agriculture for cultivating vegetables.
Nilgiris planning to implement online shopping which helps customer to purchase of vegetables from home. Through this technology, marketing performance and strategies are increased with profit.
As mentioned above Nilgiris is one of the South India’s fastest growing retail supermarket, they started the firm in a small retail outlet and expanded their branches throughout South India by satisfying the needs of the customers as well as giving handful profit to the farmers.
It periodically monitors the exact output of the macro environmental factors which helps to improvise and establish their firm all over the Southern part of India and that becomes a path to the emerging retailers for the rapid growth of economic development. It created awareness to the farmers to know about farm to fork theory and avoided the mediators getting benefited. Nilgiris created a runway to the other competitors how to satisfy the needs of the customer with good customer’s satisfaction and providing a superior quality of products at lower price by making a direct dealing with the farmers.
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Nilgiris not only focuses on customer needs but also fulfill the needs of employer by giving handful of benefits such as medical facilities to entire family, providing education for employer childrens by means of education trust. In today’s competitive market, Nilgiris provides superior quality and promotes the products by modern means of advertisement which makes Nilgiris to stand best among the competitors.
In future, Nilgiris has planned to increase the number of customers by implementing the e- shopping to raise their standard to the international market and make customer to feel free and comfortable for their product purchase.
The scope of this assignment is to collect information and learn about different factors of marketing mix and invent the new aspects that emerge the competitive merits of a chosen organization
7.0 MARKETING MIX
It is a combination between various products that determines the price, quantity, quality and stability. It consists of four marketing mix elements such as Promotion, Price, Product and Place. It aims how to control the organization and how to support the customers to supply for their goods or services.
Figure: Marketing Mix elements.
The first element in market mix is Product. The products are introduced in the market based on environment and demand. Before introducing the new product into the market, a proper market analysis will be determined to make huge profit for the organization than compared with normal products in the market.
7.1.1 NILGIRIS PRODUCTS
Nilgiris have a wide range of products such as fresh fruits, vegetables, groceries, eatable items and dairy products etc. The main goal of Nilgiris is to provide fresh and superior quality products to the customers and to retain the standards in the competitive market.
Fruits and vegetables
Nilgiris deliver fresh fruits and vegetables to the customer with superior quality and hygienic condition at low price. The main factor of Nilgiris is to make a direct deal with the farmer and acquire the fruits and vegetables at low price without agents.
Nilgiris has their own brand of groceries which is manufactured and produced in own firm. The major space allocation in the retail outlet is done by the Nilgiris own brand products when compared to other competitors in the market.
Food and Beverages
Nilgiris provides best quality of food product with good hygienic condition and properly preserved in the cooler. It maintains the best standards of food products with the expiry dates.
Nilgiris provides best quality of dairy product with superior quality and properly preserved in the cooler. Nilgiris has its own dairy farm, so that it gives the best quality of dairy products to the customers compare to other products in the market. It maintains the best standards of food products with the expiry dates.
7.1.2 OWN BRAND NAME
Nilgiris has its own brand of products which is circulating to all retail outlets in southern part of India. It sells products under the brand name of “Nilgiris 1905” which gives the brand image to promote their own products and make familiar to the customers.
Nilgiris has its own brand identity using its brand name called as “Nilgiris 1905” which involves their marketing tactics to popularize their brand name. Nilgiris consists of integrated brand method by which company purchase all products at low costs and sell to the customer at a lower price. Which increase their sales and promotion of their brand.
Promotion is considered to be the major key for marketing. It helps in improvising the relationship between customer and vendor for the purpose of customer satisfaction as well as enhancing the market strategy and promotion of the company through their products. The advertisements play a major role in promotion of the company and products.
7.2.1 COMMUNICATION MIX
Nilgiris spends 0.4 to 0.6 percentage of their profit for advertising their brand name and products from their company. Marketing communication mix is considered as promotion mix of an organization. Public relations, sales promotion, direct marketing, advertising and personal selling are considered to be the major terms of marketing communication mix. Nilgiris promotes their products using the above mentioned terms.
Advertising helps the company to promote the products to all parts of South India. As a result of advertising it brings eagerness to the customers to buy the product. Nilgiris promotes their products by modern means of advertising such as Newspapers, Television, online advertising.
Nilgiris introduced various discount schemes on weekends and festival seasons to attract the customers and also introduced membership card and gift vouchers to attain customer satisfaction.
22.214.171.124 STORE PROMOTION
In Nilgiris retail store provides various promotional offers to retain the new and existing customers by giving them sample product, complementary and demonstration products which makes customer feel happy.
Dangler is a board used for indication of new products launch which hangs up on ceiling. Shelf talkers are used to display the product prices to promote Nilgiris products. Leaflets involve present and future offers and circulated to all people around the retail outlets. Audio systems will communicate with all shop visiting consumers where they discuss the entire information of product promotion.
126.96.36.199 PUBLIC RELATION
The Company must have a good relationship with consumer by satisfying all customer needs and develop customer relationship day by day. The publicity of product is very important, if product become familiar to customer, the sales of that product will be profitable. So the company can provide offers and discount on that product.
188.8.131.52 SALES PROMOTION
Sales promotion is targeted on consumers with free samples, scratch cards, exchange offers, coupons and discounts etc. This type of promotion is used to attract the customer to attract their interest on products.
To attract the consumer, Nilgiris offers various sales promotion modes for last 12 months. There are free samples which are used to attain interests of customer and make product supply higher. Scratch cards are provided to regular customer to encourage their shopping happily. Exchange offers makes customer to exchange their purchased products through which the customer can get their willing products and customer satisfaction is necessary for company growth. The Discounts and Coupons will attain the interest of customer on products and many products can be sold with profits and promotion of product and company will grow rapidly.
Nilgiris has got wide areas on agriculture land about 2700-3950 square feet to cultivate fruits and vegetables in large amount and harvested by Nilgiris farmers from the lands in good atmosphere. This type of agriculture helps company in production of products in large and lot of profits is obtained by Nilgiris. The company builds up a warehouse to store large amount of production products and retrieve when product demand occurs. The warehouse is a store room used for distribution process within the company.
7.3.1 WAREHOUSE IN NILGIRIS
Generally warehouse is used as store house and the product are distributed when demand of product occurs. The harvested products will collected in store house and used when required from storage place. Nilgiris maintain stock management. Perishable products like milk, butter and ghee cannot be stored in warehouse.
Price is listed on each product in Nilgiris in the form of bar code and cash numbers. Price is determined by marketing management to sell the products. Marketing mix elements includes cost of products. The rates are charged with tax. Nilgiris trade fruits and vegetables at lower price than current market value. The company purchase products directly from farmer without any agents and sell product at lower price.
The price consists of retail, dealer, credit terms and discounts which control market growth. The organization will decide the price and discount assigned on products.
8.0 COMPETITIVE ADVANTAGE
The company is focusing on achieving a stable position in competitor market. If company grows above profit standard, a competitive advantage is attained than its competitor. The company invokes competitive advantages on production and supply of product at lower price in market. It consists of two competitive advantage are cost and differentiation advantage.
8.1 COST ADVANTAGE (COST LEADERSHIP)
It engages the lowest price position in organization. Many small businesses use this cost leadership method for serving and reduce price in all sections.
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