APROJECT REPORT

ON

“Study of Promotional Activities at Choithram LLC With special emphasis on role of promotion in building strong store

image and customer flow””

For

T. Choithtram & Sons L.L.C. U.A.E. (Dubai)

Submitted in the Partial Fulfillment of the RequirementOf Course

Master in Business Administration(SESSION 2006-2008)

Submitted byKRISHNA. R. PAWAR

(Guide)

Prof. Mr. Yuvraj Lahoti & Prof. Mr. Doke Vishwakarma Institute of Management

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ACKNOWLEDGEMENT

I wish to extend my gratitude to all those who have helped me in

the completion of this project. First and foremost I want to thank my

project guide Mr. Yuvraj Lahoti and Doke sir for their generosity,

faith and superb guidance. I am also thankful to Mr. Yash Gandhi,

Rahul sonawne for their co-operation.

I take immense pleasure in thanking Mr. Ashok for always being

so friendly and co-operative in all the work assigned to us. I wish to

thank all the staff of T. Choithram and Sons. L.L.C., especially

section boys for helping us in long hours of work.

I also extend my gratitude to all the accounts members, especially

to Mr. Kiyas Mohammad for providing us with the data required for

the compilation of our project.

I would like to extend my gratitude toward Dr. Sharad L. Joshi,

Director, Vishwakarma Institute of Management, for his technical

and moral support required for the realization of this project report.

Thanks to all.

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Table of contents

Chapter NO 1 Title Page no

1 Abstract

2 Introduction

3Retail Trends in

UAE

4 Company Profile

5 Objectives

6Research

Methodology

7Analysis

8

Findings

9 Recommendations

10 Bibliography

11Annexure

5

RESEARCH IN

ABSTRACT

6

TITLE:-

“Study of Promotional Activities at Choithram LLC With special

emphasis on role of promotion in building strong store image and customer

flow”

Research Methodology:-

A) Primary Data Source:-

Questionnaire, Interviews

B) Secondary Data Source:-

Books, Journals etc.

.

Research Design:-

The stores visit will be carried out for collection of data. As I

have noted above, the data will pertain to all factors of promotions. The

survey will be on Interview basis with employees of Choithram

Supermarket. Observations will be recorded for said research in store.

Questionnaire is designed to obtain information about

Supermarket. The information collected through stores visit will be assumed

accurate, for analysis.

7

OBJECTIVES:-

1. To know the Retail Trends and its implementation in Supermarket.

2. To study role of promotional activities and advertising in a

supermarket.

3. To study the various promotional channels used in a super market.

4. To study the effects of promotions and advertising on sales.

5. To study how customer loyalty can be built through promotional

activities.

STUDY CONTENTS:-

Promotional activities, promotional channels, buying behavior, impulse

buying, pricing strategies, customer loyalty.

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PRICING AND PROMOTIONS: - The prices of all products

are decided by the head office. Every product has price tag fixed on it,

with barcode strategy for pricing. Prices are comparatively high in

Choithram . Another thing is prices vary by location of stores. Special

displays provided by Vendors, self-made displays, and gift voucher

such activities are undertaken for promotions. Objective behind display

of product is to create demand and to build stores image.

CUSTOMER SERVICE: - According to T. Choithram & Sons

customer service plays a vital role in whole stores management. TCS

offers home delivery of goods in selected stores, consumer credit

system, and acceptance of Credit cards. TCS tries to retain its customer

by way of keeping customer feedback forms at every checkout counter.

TCS provides Value, Quality and Price to its customer.

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INTRODUCTION

In-store promotions have an important role in the retailers'

marketing efforts. Retailers use those short-term strategy variables

to influence the sales of certain products and consumer purchases,

and in particular to encourage unplanned purchases. Most common

promotional devices used inside the stores, involve different forms

of price reductions, in-store displays, brands advertised, free

sample of merchandise, and couponing. In-store promotion is of

special importance to high/low retailer, since it offers a high-

service level and prices above their competition’s prices, and the

usage of frequent price promotions is needed in order to increase

traffic by attracting both value-conscious and price-conscious

customers.

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COMPANY PROFILE

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COMPANY PROFILE

Company was founded in 1944, in Sierra Leone, and arrived in

the United Arab Emirates in 1974.

The deep-rooted T. Choithram and Sons, focused on one

remarkable vision, the aggressive diversification and geographical

expansion, which led the company to UAE.

Within a short period, the company is acknowledged today as the

largest chain of the Supermarket group in the Emirates, with twenty

four Supermarkets and five Department Stores at prime locations

spread over the seven Emirates of the UAE.

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The company has grown to become on the most popular chain in

the UAE and today represent over sixty multinational companies in

the Emirates, which are handled by several specialized divisions.

With the experience of over 60 years of marketing branded

consumer products, the Company’s infrastructure, extensive

knowledge of the market and the support of dedicated employees

numbering over 1500, all come together in a very effective

marketing-mix to offer their principals the best distribution network

and support in the UAE.

The Company’s popular chain of Supermarkets & Department

Stores, conveniently located, lend important and significant support

for brands and agency lines, through prime products displays,

facilities for below-the-line marketing activities, test launching of

promotional offers and even to conduct valuable consumer surveys

to help formulating sound and effective brand development

strategies.

The Company’s well established Catering Division, services, apart

from the regularly awarded government tenders, over two hundred

major institutional clients:

\

– AIRLINES

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– RESTAURANTS

– CLUBS

– SCHOOLS

– PETROL STATIONS

– KIOSKS AND SO ON ….

The novelty division handles agency lines from over twenty-one

countries, supplying to the wholesale and retail outlets in the UAE,

with new products innovations in novelties, fashion wear, children’s

garments, toys, household appliances, domestic products, etc.

“ With the Company’s expertise

Warehouse facilities, distribution

Centers and fleet of delivery vehicles,

Prompt products availability is

Ensured even in the remotest outlets

in the country ”

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MARKET CHARACTERISTICS

DUBAI is the business hub of Middle East, is throbbing with

multidimensional activities and is undergoing thanks to the vision

and foresightedness of the country’s leadership, tremendous

growth, which is evidenced by the fact that a country until 3 years

ago with a population of 2,5 – 3 million in now accommodating and

catering for 5 million people.

“ It´s envisaged that the growth will rise to 10 million by the year

2010 ”

With the increase in growth, all spheres of business are growing

proportionately. Today Dubai can boost about having the highest

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number of the most modern Supermarkets and Hypermarkets,

allowing consumers most comfortable environment to do their

shopping, from groceries to electronics to apparels to most of their

requirements, All from under one roof. Shopping in these malls and

super markets is as much an entertainment as a shopping exercise.

CHOITHRAM takes the pride of being among such

Supermarkets with highest degree of popularity with the local

Arabs, Asians and the Western Experts offering it’s long range of

quality products at very competitive prices.

The Produce section of Choithram is one of the busiest.

Fruit sourced from any where in the world by important

importers such as Fresh Fruits, Abbar O Zainy, Sharbatly, Iffco are

always available with us.

In fact, we are in process of commencing our own import

program and in doing so we will be more than happy to source

Argentinean Oranges, Lemons, Pears, Apples and Stone fruit.

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The Produce section of Choithram is one of the busiest.

Research methodology

Research methodology is a way to systematically solve a research

problem. It may be understood as a science of studying how research is

done scientifically. In it we study various steps that are generally

adopted by a researcher in studying his research problem along with

logic behind them.

Research process

Before embarking on the details of research methodology and

techniques, it seems appropriate to present a brief overview of the

research process. Research process consists of series of actions or steps

necessary to effectively carry out research and the desired sequencing

of these steps.

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Formulating the research problem

Extensive literature survey

Development of working hypothesis

Preparing the research design

Determining the research design

Deliberate sampling

Simple random sampling

Systematic sampling

Stratified sampling

Collecting the data

By observation

Through personal interview

Through telephone interviews

By questionnaires

Execution of the project

Analysis of data

Hypothesis-testing

Generalization and interpretation

Preparation of the report

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Types of research

Descriptive research

Analytical research

Applied research

Fundamental research

Quantitative research

Qualitative research

Conceptual research

Empirical research

The above mentioned are the various types of research which a

researcher can apply in order to achieve one’s desired objective.

Therefore to achieve the objectives of my research I have used

descriptive research.

This is based on proper research design to meet the objectives of the

study.

Research Methodology:-

A)Primary Data Source:-

Questionnaire, Interviews

B)Secondary Data Source:-

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Books, Journals etc.

And collected data will be analyzed with simple statistical tools

and will be interpreted with graphical explorations.

Research Design:-

The stores visit will be carried out for collection of data. As

I have noted above, the data will pertain to all factors of Stores

Management. The survey will be on Interview basis with employees of

Choithram Supermarket. Observations will be recorded for said

research in store.

Questionnaire is designed to obtain information about

Supermarket . The information collected through stores visit will be

assumed accurate, for analysis.

Data Analysis:-

Initially data will be sorted in accordance with store visit

and designed questionnaire then data will be analyzed on the basis of

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questionnaire feedback which includes various aspects of Stores

management and observation from stores visit.

DATA COLLECTION

The project was to check feasibility of the services offered by

Choithram using primary data. The primary data was obtained through

observation, direct communication with the people and filling up of

questionnaires, also enormous help was obtained from Choithram,

branch members, crew, staff and colleagues working there.

The data collection tool that I have used is Questionnaire. I have

selected questionnaire as a data collection tool primarily because of

descriptive nature of sampling & secondly it was the most suitable tool

that could help in achieving all the objectives of the study & to do the

analysis deeply and effectively.

Prior to the 1990s, advertising was the largest part of the typical

FMCG budget.

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As short-term pressures and the strength of retailers grew, promotions

took more and more of the marketing budget, replacing advertising as

the largest component.

(Jones 1999) estimates that the ratio of Advertising / Consumer

Promotions /Trade Promo as 24% / 26% / 50%

It is commonly observed that promotions lead to short, sharp sales

spikes. Yet not all volume is profitable volume. From the late 1980s to

the present day, a growing weight of academic evidence from fact-

based studies of consumer promotion spending effectiveness has

revealed an alarming problem (Abraham and Lodish 1990),

(Ehrenberg, Hammond, and Goodhardt 1994).

For example,

Leonard Lodish found that 4 out of 5 promotions are unprofitable in an

extensive study ten years ago (Lodish and Lubetkin 1992).

Given the vast spending levels attracted by consumer promotions, it is

important to understand what drives companies to use them and what

distinguishes the profitable promotions from the unprofitable ones.

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Definition of sales promotion

Sales promotion is a surprisingly difficult term to pin down. The reason

for this is, because it includes such a wide variety of activities and

techniques.

Typical sales promotion include price-off packs, value-packs, coupons,

samples, in-pack premiums, self-liquidating premiums, refunds and

rebates, contests, sweepstakes, trade shows, continuity plans,

warranties and many others.

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The term sales promotion as used by practicing marketers today refers

to many kinds of selling incentives and techniques intended to produce

immediate or short-term sales effects. The other defining characteristic

of sales promotion is that the goal is short term or immediate. Sales

promotion is not generally used to generate long-term results or sales in

the future, but rather to generate sales results now.

The distinction between short-term and long-term results may certainly

vary with the product category and the particular industry, making a

specific time definition somewhat arbitrary. But the important idea is

that the goal for sales promotion is results in the current promotional

period--not in later time periods.

Promotion is, then, a collection of techniques communicated to target

audiences to generate short-term sales results. Traditionally, sales

promotion has been viewed as a non-recurrent selling activity, and it is

often defined as such.

However, this view does not reflect the current condition of frequent

and repeated sales promotion programs necessary to maintain business

in many product categories. In most cases, sales promotion has become

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an all-too-recurrent activity, so the idea of a non-recurrent activity is

eliminated from the definition here.

What drives companies to

use promotions?

The simple truth is that promotions are fun to start and challenging to

stop.

(Ambler 1996) comments that “promotions are no more, and no less,

addictive, than cocaine”. Similarly, Ehrenberg, Hammond, and

Goodha.rdt (1994) comment that “there are many pressures to promote,

acting on middle or junior management”.

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Positive reasons for promotional spending.

Immediate dramatic consumer sales spike

Fear of trade customers (display, listing, stock

levels)

Keeping up with competition

Giving salesmen something to say

Negative reasons for avoiding

promotion include:

Stockpiling by consumers cannibalizes volume

advantages of spike

Encouraging consumers to become bargain hunters

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Costs of promotion do not cover profits from spike

Costs associated with supply chain turbulence

Volume Price CostImmediate

(During the promotion)

Volume price cost

Immediate during the promotion

Consumer –Accelerating purchase;obtaining trial purchase;obtaining share ofvolume.

Trade – Increasingtraffic in channel;obtaining trade support;manipulating tradeinventories

Consumer-(during thepromotion)

Reducingthe net transaction price to the consumer (or increasing the net value, in the case of gifts);deflecting attention from a high price.

Trade – Reducing the off invoice trade price

Direct cost ofpromotional incentives,other than off invoice.Indirect cost of “special”manufacturing andpackaging.Cost of trade promotionsnot passed on toconsumer.

Indirect cost of supplychain turbulence.

Medium Consumer –Decelerating next

Consumer – .

Scrapping of unused

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term{4-16weeks}

purchase (stockpiling);encouraging repeatpurchase; encouragingmore frequent usage;denying volume tocompetitors

Trade – Increasingtraffic in channel(bargain hunters).

Encouraging bargainhunting.

Trade – Pressure toreduce prices.

promotional incentives.Re-packaging of stockto remove promotionallabelling.

Long term{ 16-3 years}

Consumer –

increasingconsumer loyalty;increasing penetration.

Trade – increasingtraffic in channel;increasing trade loyalty

Consumer –Encouraging bargainhunting; discouragingpurchase off-promotion.Trade – Pressure formore promotions.

Consumer purchasing behavior

By far the most common management expectation about promotions is

that they drive sales volume. There is an extensive literature on

consumer purchasing behavior that is useful to review prior to

addressing the more specific question of consumer buying responses to

promotions.

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Most consumers have a repertoire of two or three brands in a category

which they habitually buy over time (Ehrenberg 1988) (Brown 1953)

and (Cunningham 1956). The groups of brands purchased are called the

brand repertoire.

Multi brand buying may come about because:

Buyers seek variety, for example in beverages and

confectionary

A preferred brand may not be available

A consumer promotion may temporarily attract

purchasers

An understanding of the factors that affect habitual purchase is

important if the right marketing decisions are to be made. Is a

consumer’s brand repertoire the result of variety seeking, bargain

seeking (and promotional response), or inability to buy the preferred

brand frequently? Answers to these questions relate to marketing mix

decisions.

There is no necessity for habitual purchasing to involve strong feelings

or cognitive processes. It is quite possible for people to buy regularly a

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brand they dislike (through economic necessity). People make some

brands, such as Guinness, a small part of their portfolio yet continue to

buy this brand for a long period of time. People may like a brand but

not purchase it through lack of need or opportunity (for example

Porsche).

Purchase habits also apply to brands that we routinely do not buy. Most

of us will admit to avoiding certain brands that we dislike, but brand

avoidance also applies to brands that are unfamiliar to us as individuals.

Price-offs. A manufacturer’s price-off is printed directly on the

product packaging and becomes an integral part of the product’s

appearance to consumers. Special labels might also be used. The

advantage of price-offs is that they are easy for the consumer to use,

and they put the product in direct competition with other products on

display. The disadvantage is that everyone who buys the product

takes advantage of the price reduction, including those who

routinely buy the product at the regular price. Trial is therefore

restricted mostly to bargain-hunters, who are inherently less likely to

stay loyal following the offer.

Bonus packs. Another way the consumer can be offered a

special price is to increase the amount of the product offered for the

same price. Bonus packs can also take the form of BOGOF (buy one

get one free), buy two get one free, and many variants on this theme.

The advantages of bonus packs are that they can increase the amount

of display space for the product, and increase consumption rates, due

30

to the pressure on storage space causing the consumer to use the

product faster. The disadvantages are that they may well not be

profitable – the cost of the extra free product may be more than the

value of the extra sales.

Gifts. There are many types of gifts, including. The advantages

of gifts are that they can enhance the product’s value, if they relate

to its brand values, or link with sponsorship themes (such as

Formula One). The disadvantages are that trade customers may

resist storing and handling the gift items, and also theft and pilferage

can be serious problems.

Coupons. Coupons are by far the commonest promotional method

in the USA, but their popularity is lower elsewhere. There are two

kinds of coupons – manufacturer coupons, where everything is paid

by the manufacturer, and trade coupons, which are paid partially

by the retailer. The advantage may be that only a percentage is

redeemed, but the disadvantage is that they create clutter and work

for those who process them.

Continuity plans. Continuity plans require the saving of some

item relating to the purchase, such as stamps, that may be used for

prizes or reduced costs. The advantage of using them is that they

reward heavy purchasers for being heavy purchasers. The

disadvantage may be that they do not reward true loyalty, merely

heavy purchase.

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Loyalty cards are in many ways like electronic continuity

plans. They have the additional advantage of creating a database,

and the possibility of tracking heavy purchasers. Against this must

be factored the disadvantage of substantial IT cost.

Refund offers involve the purchaser in sending a proof-of-

purchase in return for a reward. They have the advantage of

rewarding loyal purchasers, but disadvantages include a poor record

in generating trial purchase.

Contests and sweepstakes differ in the eligibility rules:

contests require that consumers purchasing the product enter, while

sweepstakes do not. Some contests require skill, whereas

sweepstakes do not. The advantages are that they create interest

through press and word-of-mouth, plus they can be a source of

customer data. The disadvantages are the clutter and effort of

organizing.

Sampling provides the consumer a free sample of the product

and is a very effective means of introducing a new product or

demonstrating an improvement of an existing product. Typically a

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small trial size is offered. Although sampling has the advantage of

starting trial usage, its Disadvantages are considerable, especially in

terms of distribution.

The promotional planning process

Offers

The promotion must offer something valuable to its recipient

Channel exposures

The promotion must be seen, read or heard in a channel

Processing the offer

The audience must pay attention to the offer and absorb its meaning

Psychological response

The offer must also cause a mental response leads to action

Behavioral response

The offer must cause more people to buy more of our product, more often.

Economic response

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Economic response Promotions are only worthwhile if they have an economic

payback

Immediate value promotions,

price-offs and bonus packs, remove the problem of “high price” and may be

perceived as “good value”.

The most usual way of testing alternative offers is to survey a range of offers, with

several other closely competing brands – all at their normal prices – then

progressively introduce better and better offers on our brand until an acceptable

percentage of the survey sample indicated that they would buy our brand.

Future value promotions,

Samples and trial offers, function by reducing the perceived

risk of trying our brand. The major method of testing samples

is by placement of samples at several hundred prospective

locations, and counting the numbers of trials.

Gift promotions

Are tested in various different ways. Premiums need to be tested

first for the appeal of the gift itself – displaying them side-by-side,

including gifts that have previously been used with known results.

Coupons are tested in much the same way as immediate value

Promotions.

Chance promotions

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Prizes should be tested and compared for their appeal.

Contests versus sweepstakes should be compared, by

discussing simulated promotion situations with potential

entrants.

Ten hard questions to ask or be asked

1. Do we believe that our promotions have anything other than a short-term

impact?

2. If so, what is the evidence for this?

3. How well do we integrate promotional activity with advertising and display?

4. What percentage of our trade promotional expenditure is passed on to

consumers?

5. Do our promotions devalue the brand by encouraging “bargain hunting”?

6. Can we enhance the loyalty tie-in of our promotions?

7. What analysis supports our choice of promotional offers?

8. Do we understand and take into account the direct and indirect costs of our

promotional offers?

9. What process do we use for planning our promotional campaigns?

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10. What do we do to research, test and track our promotional campaigns? Is what

we do adequate?

Conclusions

Many promotions do not cover their costs.

Promotions often produce an immediate and measurable “spike”

in sales volumes, but a positive effect on sales after the promotion

has ended is rare and generally small.

Trial purchases from first-time buyers are a minority. Most

consumers who buy on promotion have previous experience of the

product. They switch temporarily away from other brands in their

repertoire (thus temporarily increasing the purchase frequency of the

promoted brand, and decreasing the purchase frequency for the rest

of the category).

Frequent promotion by competitors reduces the purchase

frequency (and share) for non-promoted brands. Where a significant

percentage of category sales is sold on promotion, brands that do not

promote will be “locked out” during promotional periods, and

purchase frequency will fall.

Sales promotions should not happen on an ad hoc basis, but be

implemented via a campaign plan, with every campaign having a

specified objective which reflects the overall marketing strategy.

Sales promotions carried out by and through trade customers

require a different type of campaign management and offer from

those targeted directly at end consumers.

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Rigorous testing and tracking of responses to individual promotions

reduces risk, and enables campaigns to be rolled out, withdrawn, or

fine-tuned to reflect market behavior

ANALYSIS

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The retail purchase decision by

customers at Choithram.

Purchase type % of total retail

sales volume

Planned purchases (Pre-store Decision) 67%

Impulse purchases (In stores Decision) 33%

No intention of buying the particular product

but did so

14%

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Intended to buy a product but no specific

brand in mind

10%

Added an extra title to core product purchase

on impulse

5.5%

Brand switched from intended purchase In-

store

3.5%

The results show that two thirds of the volume of product sales are planned purchases - ie. The decision to make that purchase was determined prior to the consumer entering the shop. However, one third of the volume of product sales (and growing) is made as the result of an in-store decision.

WHY CUSTOMERS OPTED TO BUY

Reason for purchase % of Total Respondents

Part of regular purchasing pattern 41%

Cover browse related attractions 33%

Impulse 11%

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Price 9%

Added values 4%

Recommended by friends 1%

Stimulated by an advertisement 1%

Customer’s feedback

PART OF A REGULAR PURCHASING PATTERN

"I always buy it" is typical of this category. The consumer may still be

buying on impulse on this particular occasion, but they are buying a

title which they are familiar with and have often bought before:

"reminder buying".

COVER / BROWSE-RELATED

A whole range of statements fall under this category: "It caught my

eye", "It looked interesting", "The front cover attracted me", "It had an

article of interest". All the statements are based on the fact that

something specific caught the consumer's interest, either from the cover

40

itself or from a quick flick through the pages. With one third of buyers

stating that this prompted their purchase, this clearly underlines the

importance of the front cover layout and design.

IMPULSE

"I just wanted to try it". "I wanted a change".

PRICE

"It's good value". "Its cheaper than the other like it".

ADDED VALUE

The presence of a cover mounts or supplement. This is a classic area,

like price, where consumers often under claim under research

conditions as they do not like to be seen to be influenced by give-

aways. This reason is much more important, predictably, among those

buyers who had made their decision to buy in-store (44% higher than

among those who had decided their purchase before they entered the

shop). Also, cover mounting is very high profile within a few, key

magazine sectors.

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STIMULATED BY AN ADVERTISEMENT

The conscious recall of an advertisement for a specific title accounts for

only 1% of purchasing occasions. This is not to dismiss the value of

above-the-line advertising, but is mainly a reflection of the way in

which advertising works which is often not "top-of-mind".

Why customers did not opt to buy

Identified two distinct groups:

(1) Those who dip in and out of the shop without looking at the

magazine displays.

These people are simply not in "magazine buying mode". They are in a

hurry.

They are in the shop to buy something else. They simply do not want a

Magazine at the moment. There is clearly very little that anyone can do

to alter the consumer's behavior on such occasions.

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(2) Those who come to the magazine displays to browse, but who do

not buy.

Three reasons emerged most commonly for non-purchasing:

Reasons for browsing, but not buying % of Total

Respondents

I only intended to look 24%

I couldn’t find the one I wanted 21 %

Just wanted to see what’s around 20 %

Clearly, browsing the magazine racks is a pleasurable activity in its own right and many consumers do it with no intention of buying a magazine. Yet just over one fifth of readers who do not buy fail to make a purchase because the magazine they want is not on display.

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Customer Loyalty

Customer loyalty can be classified into brand loyalty,

vendor loyalty, service loyalty, and store loyalty.

With lack of consistency, marketing researchers have defined customer

loyalty. We can classify these definitions into a behavioral approach, an

attitudinal approach, and a combined approach.

Behavioral Definition.

Early studies on loyalty have been done on individual brand which can

be measured from panel data and brand loyalty largely was understood

as behavioral concept. They focused on observing and measuring the

continuation of purchases in the past (Brown 1952-1953). Kuehn

44

(1962) used stochastic approach to find behavior of brand loyalty of

customers. He saw brand loyalty a function of purchasing history of

customers. Lip stein (1959) thought brand loyalty as a function of

probability of purchase of the same product or a function of time for a

specific brand. Jacoby and Chestnut (1978) summarized 53 early

definitions of loyalty and made a conceptual definition. According to

their definition, loyalty is a biased behavioral reaction of consumers in

the choice of one among many alternatives in a period of time and it

can be represented as a function of decision-making process. Jeuland

(1979) also used stochastic model to define brand loyalty. In his study,

it was defined as long-term probability of choice or purchase ratio of a

specific brand among total product categories and such a behavior was

named as inertia.

In summary, behavioral definition of store loyalty is a tendency of

consumers to purchase repetitively in a period of time and it can be

operationally defined and measured as purchase ratio as repetitive

purchase behavior (Raj 1982), purchase frequency. By using these

definitions, it can be objectively measured and has an advantage of

distinguishing store loyalty for various stores. But it has limitations that

researchers can easily use subjective judgments and that it is hard to

explain how the store loyalty is formed and why it changes.

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Attitudinal Definition.

Attitude is a learned tendency of preference to consistently show favor

or disfavor and affirmative or negative reactions. Consumers have a

favorable attitude to a specified brand but they don’t always purchase

that brand since there are various situations. But attitude influences

behavior a lot. Thus the concept of loyalty is viewed not separated from

the attitude that represents individual psychological tendency in

repetitive purchases. Moreover, the attitude of consumers relatively

evaluating a specified brand is important since repetitive purchases

mean that consumers choose it among various alternatives. n summary,

store loyalty in an attitudinal sense can be understood as store

preference or psychological commitment and hence it can be defined as

favorable attitude to the specified store and operationally it can be

measured future probability of purchase(Oh 1995). By this definition,

we can figure out the process of psychological formation of it but it is

uncertain that favorable attitude to the specified store is converted to

real action o buy. The marketers can see the store loyalty in attitudinal

approach have little practical value.

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Combined Definition of both Behavioral and Attitudinal

Approach.

Dick and Basu(1994) combined both behavioral and attitudinal

approaches and then defined store loyalty as favorable attitude and

repetitive purchase of consumers so that the concept can be

comprehensively understood and they argue that their concept was

desirable since both components could be measured. Either favorable

attitude or repetitive purchase alone cannot be necessary and sufficient

conditions of index of store loyalty and the both must be considered

together in the light of consumers. Following this view of store loyalty,

we define store loyalty as favorable attitude of consumers and tendency

to purchase repetitively in a period of time.

Store Image

Definition of Store Image.

47

The concept of store image was used by Martineau (1958) for the first

time. He defined it as “a store defined in customers’ mind partly based

on functional attributes and partly based on psychological attributes.”

He claimed that store image includes its characteristic attributes and it

makes customers feel the store different from others. Functional

attributes are assortment of commodities, layout, location, price-value

relation, and service that consumers can objectively compare with other

stores. Psychological attributes are attractiveness and luxuriousness that

represent special attributes of that store.

FINDINGS

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Store Image Components at Choithram

Dimension Component Content of component

Merchandise Quality Excellence of quality relative to the other

stores Excellence of quality relative to price

Overall excellence of quality

Price Low price relative to the other stores

Reasonable price relative to product

Overall lowness of product prices

Assortment Availability of new (fashionable) products

Variety of brands

Variety of product designs and colors

Variety of kinds of product

Overall availability of various brands and kinds of product to

choose

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Promotion Frequency of sales

Scope of sale of product

Providence of new product information

Invitation of cultural events and special sales

Sending cards for birthday or anniversary

Frequency of gift events

Placement of right catalogues

Variety of gifts

Benefits of store credit card (long credit and mileage)

Advertisement Information providence of advertisement

Usefulness of shopping plan of advertisement

Appeal of advertisement

Confidence of advertisement

Convenience Easy movement within the store

of shopping Easy search of wanted goods

Possibility of blanket purchase

Overall convenience of shopping

Convenience Easy entrance and exit to parking lot

of location Connection to public transportation (bus and subway)

Proximity to home or working place

Shopping bus schedule

Availability of free parking

Store facility Easy use of physical facilities of the store

(Escalator, elevator, baby cart)

Well-assorted rest area (snack corner, toilet, coffee shop, chairs)

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Clean in and out facilities

Overall modern facilities

Store service Salesperson Kindness of salesperson

service Assistance of salesperson on product and related

information

Providence of new information by salesperson

Affirmative action and solution to complaints by salesperson

Excellent customer service

Credit service Variety of credit cards accepted

Easy return and exchange of goods

Possibility of money return in the case of impossibility of return

or exchange

Store Happiness of shopping atmosphere

atmosphere Relaxation of shopping atmosphere

Excellent presentation and decoration of products

Luxurious atmosphere of lighting, color, and facilities

Store brand High class image

High brand name

Dimension Component Content of component

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DIFFERENT PROMOTIONAL

ACTIVITIES AT CHOITHRAM

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SNAPPY TOM PROMOTION AT CHOITHRAM

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This promotion was a real eyeball catcher, appreciated all over the

Choithram stores, and a big success too.

All the European customers were very much impressed by this

promotion.

The most important factor behind these promotions were the fact that

these promotions were common in all choithram stores, and a

competition is held amongst all choithram stores, the best visual

promotion gets an award.

It is competitions like these which keeps the employees nimble on their

feet, and thrives them to work with a will.

All the visual promotions are very much responsible for enticing a

customer, to purchase a commodity.

There is a finding that says, a perfume bottle is purchased by the

customer because of its cover, than its fragrance.

It is therefore a result of visual promotions in stores, which lead to

unplanned purchases One more important thing to be noticed in the

promotional picture is that, the other products like Arial, and a few

shampoos which are supposed to be the upcoming promotions for the

next month, are also kept so that the customer should get a glimpse of

things to come

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Discount of whopping 50% at wonder land theme and Water Park.

This was another special promotion at all choithram super markets,

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If a customer spends AED 250 at any choithram stores in a single

invoice then he gets a whopping 50% discount on splash land in

wonderland a water park

It is promotions like these which magnetize the customer towards the

stores, he is always on a look out for the upcoming, and ongoing

promotions.

Promotions like these helps to draw the customer into the stores, it is

places like water parks and amusement parks, where one spends the

best quality time, along with the family, and by offering promotions

like these the super market actually has a part to play in the customer’s

jolly time.

No wonder promotions like these bring happiness to the customers.

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Gift voucher

This promotion involved an attractive gift voucher, which was for sale,

this gift voucher meant that a customer can gift this voucher to any

person he knows, gift voucher actually enables the customer to

purchase any commodity from any choithram stores as per the amount

mentioned on IT which is available in the multiples of 50 AED .

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It is promotions like these, which help to draw new customers into the

super market, it helps in creating commendable stores image, and build

customer loyalty.

Purchases through such vouchers bring immense pleasure to the

customer as it gives him the feeling of free shopping.

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A tie up with ABN AMRO CREDIT CARD

Shop Save and Win, with ABN AMRO credit cards

Great discounts, special offers, and a jeep wrangler just a swipe away.

By shopping with an ABN AMRO credit card for over 100 AED or

more the customer gets the chance to win a brand new wrangler, also

great discounts and offers every time a customer shops at the

participating outlet from 15 June to 15 aug .

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BN AMRO OFFERS AT CHOITHRAM Spend AED 250 or more and get 4.5 kg

Unifrutti Fruits [1.5 kg Red apples 1.5 kg S .AFRICAN Clementine, 1.5

kg Orange Navels] absolutely free

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A Mercedes Benz, the biggest ever promotion one would get to see in a

super market

Shop at Choithram for 50 DHS AND WIN A MERCEDES c 180

Model Car with a sms

Offer starts on 15 Nov 2006, and the Draw date 15 Dec 2006

Draw venue

Choithram, Safa park outlet at 5 pm

Terms and conditions

On a single purchase oh Dh 50/- the customer will get a coupon to

qualify to SMS and win the prizes.

This coupon is valid for entry for the promotion only.

Each SMS costs 5 Dhs

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A unique promotion of garments through pamphlets

This promotion was done at the Dubai-Karama, Ajman Ras AL Khaima

and Fujairah outlets.

This was a weekly promotions, the promotion was all about finding the

best deals when it comes to garments wide range like, Boys T shirts,

shorts,

Men’s twill shirt, right from kids wears to adults.

It was advertised as Factory Zone outlet, which generally catches the

eyes of the Asian customer.

Garments were for sale at the cheapest rate one could ever get with a

commendable quality.

Free home delivery was also offered on minimum purchase of 25 dhs,

within the radius of 2 kms. The offer was valid till the stalk lasted

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This was another promotion through pamphlets which was for a month

This pamphlet gave a brief summary of the fresh fruits and produce

available at choithram, the picture’s displayed, and the price mentioned

below, gave the customer a clear idea of things he is looking for at a

desired price

This promotion also had consumable and consumable items,

Non consumable items involved electrical appliances, cosmetics, house

holds, garments, etc.

Different brands like coca cola, London dairy Dairy milk, kellogs were

also advertised in stores customer communication techniques and

signages are very essential to keep a customer unruffled, and

comfortable in a store, people nowadays are calorie conscious and

hence I found this signage catchy.

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Items whose expiry date is near are supposed to be cleared

immediately, hence special promotions are done to cope up for the task,

a special display of reduced to clear items is done. Prices of the items

which are supposed to be stock cleared are reduced by considerable

margin, i.e. more than 50%at times

Special promotions like price highlighting are practiced,

At special occasions like Ramadan shiny cloths and dates are on

display for festive promotions.

Radio hip off music is used to keep the buying tempo of the customer

going, eg: jazz music influences customer for unplanned purchases.

Practices of visual merchandising, knowledge of awareness, at the point

of sales danglers are practiced as tools for promotion

Suggestions

The core elements of retailing –

Your Consumers

Understanding the needs, emotions and desires of the final user of your

product or service helps you to plan your interactions and your business

relationship with your customer. Read on to find out how consumers

make their buying decisions and how you can best serve their needs.

71

Your Products

By understanding your consumers you can better determine how your

products and services must evolve to meet the changing needs of the

marketplace. It is also essential to know how to promote and display

your goods or services to catch the attention of your target market.

Your Premises

To delight your customers and maximize your sales it is vital that you

create the appropriate image and ambience for your true demographic

and generational market. The external and internal ‘feel’ of your

premises must be comfortable and negotiable for your target market.

Your Business

To succeed today business owners and managers must be innovative,

creative and think outside of the box, both in the way your operate

your business, promote yourself, display and merchandise your

products and services, and care for your customers.

The times they are-a-changing, and that applies to retailing too!

Competition today is fierce, margins are growing slimmer and

customer’s lifestyles and buying habits are changing. It is no longer

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enough to keep up with the competition, today you must outpace your

competition and think FOR your customers to continue to be a

profitable and financially healthy organization.

.

SWOT ANALYSIS

STRENGTH

Limited competition.

Good reputation of the company (T. Choithram & Sons.)

Quality of service.

Highly cooperative and efficient staff & crew members.

Exclusive products

Use of modern technology like credit card billing & loyalty

program .

Wide range of products to suit all customer segments.

Maximum number of branches (Approx.27)

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WEAKNESS

Target customer base very small.

No presence in semi urban sector.

Promotional campaigns are nearly absent.

Less advertising efforts.

Some times products are out of stock.

Promotions are not up to the mark

Lack Mordern Visual merchandising practises

OPPORTUNITIES

Customer education will improve the customer base.

Festive promotions will drive more customers.

By making some good promotional efforts TCS can gain more number of customers who will be loyal.

No of competitor’s is increasing very fast, especially In Dubai.

Promotions can bring spike in the sales.

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THREATS

Competition with big giants like Lulu, Spinneys, Al Madina Super market Etc.

Challenges posed by other retailers in the market.

Customer may shift to other supermarket.

Lower customer base may hinder prompt service.

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BIBLIOGRAPHY

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Bibliography

TCS Brochures & Flyers.

Web Search Engine

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ANNEXURE

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Questionnaire

1. Which has been your best promotion, regarding any commodity, in the

past few years? Could you explain it in detail?

2. What are the in- stores customer communication techniques you use.

(Signs - product information – graphics –sound – textures)

3. How do you blend ambient conditions –temperature- noise - music-

odor for promotional activities

4. How do you influence impulse buying, by promotional activities?

5 What activities do you adopt to attract customers? (Decorations-

signage - symbol- furnishings- layout- equipments)

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6. Do you adopt promotional activities such as contest-puzzles-wining

prizes-

Sample-free taste of product.

*sweep stakes –no puzzles just lucky draw-discount coupons-

Demonstration-grinding process, -cleaning procedures- referral gifts-special

events.

7. Do you look out to reduce promotion cost if manufacturer him selves

bears the expenses for displays.

8. How do you display past contest winners? Does this display help in

enticing more customers to enter into the future contest?

9. What channels of promotions do you adopt?

10. How do you constitute promotion mix?

11 .Which promotional schemes have you adopted?

12 After adopting the schemes what are the changes you have come across

in terms of sales? Have they increased? {percentage of sales increased?}

13 Do you get any customer and vendor feed back regarding the promotional

displays in the store? If they are negative, how do you go for respective

changes?

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14. How do promotions help in creating or building customer loyalty?

15 Do you adopt any promotional technique for stock clearance?

PHOTOGRAPHS OF CHOITHRAM

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