Promotional Activities of Hobbs - Case Study Example

Promotional Activities of Hobbs Introduction The paper studies the up market retailer Hobbs and seeks to provide a marketing plan for the company that focuses on direct and personal marketing strategies. Hobbs is a well known and elite retail brand that caters to various customers for their clothing requirements. The company has been establishing itself in the fashion retail market for the past 30 years and seeks to compete with the big names of today. The case depicts that the industry in which Hobbs operates in values personal attention and convenience. As a result the paper highlights the importance of one to one marketing, more personal promotions, word of mouth and the emerging technologies like the internet and mobile based marketing that are less expensive to launch and more efficient when it comes to delivering results. Selected Market The majority of the Hobbs customers are located in London as however the company has significant customers in Ireland and the rest of the UK as well. The marketing plan depicted below however is targeted towards the current and the prospective customers of the company in Birmingham. The Mosaic for Birmingham depicted that fashion consumers in the region are very versatile with people taking cues for their seasonal fashion trends from those generated by the Milan, Paris and the New York fashion weeks. The customers are highly influenced by the fashion trends generated from these fashion capitals of the world and seek to go to retailers that can provide such fashion to them in an accessible and more affordable manner. These target markets are dominated by the South Asian Families, settled Majorities, Upper Floor families and urban youth and professionals. The following table depicts the major target market segments for the Birmingham region. Type Count % A02 Cultural Leadership 2,314 3% A03 Corporate Chieftains 1,081 1% B08 Just Moving In 1,290 1% C20 Asian Enterprise 3,489 4% D26 South Asian Industry 28,759 33% D27 Settled Minorities 3,059 4% E28 Counter Cultural Mix 1,339 2% E29 City Adventurers 2,285 3% E30 New Urban Colonists 1,662 2% E31 Caring Professionals 1,300 2% E34 University Challenge 1,726 2% F35 Bedsit Beneficiaries 2,816 3% F36 Metro Multiculture 2,355 3% F37 Upper Floor Families 10,244 12% F38 Tower Block Living 6,776 8% G41 Families on Benefits 4,647 5% G42 Low Horizons 2,348 3% J52 Childfree Serenity 2,004 2% OTHERS 7152 8% Total 86,646 100% Importance of Store Management The analysis of the various types of customers that tend to shop at Hobbs depicted that the customers consider store ambiance, its environment, theme and layout. The Hobbs retail company has realized this and an effort has been made by the management to change the look and the feel of the store by employing a walnut and white interior in their stores to make them more fashionable and trendy. “When retail organizations make a major shift from an old-fashioned merchandise management orientation to a strategic marketing orientation, the development of a functional marketing plan for the implementation of strategic plan gains in importance” (Samli, 1998, p2) Other retailers in their business have also taken to store management and the management of store ambiance to further foot traffic in their stores and increase profits through sales revenue. “Starbucks, Pottery Barn, Eddie Bauer, Sunglass Hit, Putomayo and Old Navy have started to focus on music with the introduction of their own compilation CD’s. To create the right in-store experience, it is necessary to choose this music very carefully. This is an enormous opportunity to add value by adding meaning. Music may be the single most important device for delivering meaning to the retail environment and the retail environments ability to deliver meaning to the brand” (McCracken, 2005, p187-188) Customers in the retail sector tend to frequent retailers and shops that have a friendly and likeable store format that is convenient as well suits their tastes. In fashion retailers, the store ambiance is more important as it can serve as the distinction between a normal one time customer and a returning loyal customer that can provide repeat business. “marketing practitioners should manage customer satisfaction and perceptions of value in their implementation of market orientation as they are directly related to customer store loyalty” (Chen & Quester, 2006) The Marketing Plan for Hobbs The marketing management style that has been employed by the Hobbs retail company up till now has focused on attracting the masses through localized marketing and promotional appeals to the diverse range of customers in the retail market. The company however needs to reform its strategy and appeal. . The company already offers a wide variety of products and services through its stores; however the company is facing limited sales in some of its stores, while others are facing low levels of foot traffic. The company needs change its marketing strategy in order to appeal to the different niches and segments that their customers fall into The following depicts the marketing budget for direct marketing for Hobbs. The use of the budget is explained in the following paragraphs Marketing Activity £ Store Refurbishing 750 Display Windows 450 Online Marketing 600 Direct Marketing 1200 Total Budget *3000 *3,000 GBP is for three Birmingham stores with 1,000 dedicated to each store The main marketing strategy of the company should be to overhaul the image and the brand persona of the store. The Hobbs brand needs to be updated to associate it with the classics in terms of Versace and Christian Dior while keep it trendy and down to earth as well like Banana Republic and Gap. The company should advertise to its mainstream market through the TV, radio and the print based advertisements. The company should invest in an online marketing campaign whereby they would target the segment of their customers that are more willing to make their purchases online. This will increase the reach and the scope of the Hobbs as a brand a well as retailer. Additionally it will also increase the market available and captured by the company while increasing customer loyalty amongst the specific customer segment. Additionally the youth is very much technology hip and trendy and use the internet for entertainment as well as shopping purchases. Using internet based marketing that highlights Hobbs as a elite retail brand, show cases the collections and the lines of products at the company while also highlighting the various brands associated with and sold at the Hobbs store the company can appeal to the youth market as well. This will result in increasing the sales for the company while also increasing their profit levels at limited costs. It needs to be noted that Hobbs will need to support its internet based marketing campaign with an online shopping option as well. Aside from this the company should also focus on employing personalized marketing strategies to target its specific types of customers. The following depicts the types of customers for Hobbs and the specific marketing strategies that the company should employ to increase sales revenue from them and increase their foot traffic in the stores. As the budget available for the marketing activity is considerably restricted to 1,000 GBP per store, the marketing promotions that need to be launched need to be cost effective as well as worth the response rates. The strategies that can be employed by the company to increase its appeal to the A01, E29, E30 and E58 type customers in Birmingham. The A01 customers are uber fashionable and have a very elite lifestyle that revolves around making use of their vast funds of money to make life easier for them. They are not the kind that would get their hands dirty for a job or a purchase. As a result store image and ambiance is a high point for them in the ranking of a retailer along with the types of collections the fashion retailer features. In order to appeal to the A01 types, the company should make their retail shops posh in terms of the lighting employed that should have muted glow, stark surfaces combines with subtle drapes in ivory silk based cloth to give a luxurious and elite class feel and match with the white and walnut décor of the store. Investment of 1,200 GBP in store refurbishing in the main Birmingham stores and making innovative and inviting window displays would help the company increase footfall in its Birmingham stores by encouraging the customers to experience the new up-scaled environment in the stores. The direct marketing employed should focus on the brands carried by the Hobbs retailer and the catalogues that should be mailed to the segment should be personalized for the customers, reflecting a history of their previous purchases to provide a personal collection of fashion clothes and trends that would be preferred by them. The A01 segment itself can be categorized into young and trendy, preppy, country chic, tailor chic, country club and resort categories that would reflect their purchase patterns and the kind of fashion they are more prone to like and purchase. The E29 and E30 segment is highly brand conscious and trends to measure success by money. As a result the company should send them catalogues of their collections that focus on the brands that are available at Hobbs. The company can also go into a direct marketing agreement with other brands that it houses in its store. As a result the company would be able to send its own brand based fashion catalogue to the customers of its brand associated while reciprocating by providing its own customers with their catalogues and forms of direct marketing material. This can make way for a two way relationship between Hobbs and its external brand partners while also increasing penetration into this specific customer segment. Investment in store front displays and window displays would also bode well for advertising to this segment and increasing their foot traffic in the store. The strategy would also help the company reach a wider market through its association and networks while working in a limited budget of GBP 1200. The K58 segment can be specifically targeted by the Hobbs Company through the internet based marketing campaign and an online shopping portal as mentioned earlier. The company can roll out a catalogue focusing on the various collections that it houses for fashion, apparel, shoes and accessories to these customers that highlight on how the purchase can be made online or through the categories to appeal to this segment and increase traffic from this segment of customers. Advertising on the internet is relatively inexpensive with a massive reach in the region of Birmingham. Particularly when targeting professionals, urban and rural consumers, internet based marketing strategy can effectively increase the sales of the company as well as footfall in Hobbs’ stores. The marketing budget of 600 for online marketing would be sufficient in the initial stages of the processes, however in the following years the company will have to invest more funds in its online marketing strategy and online retail option. Conclusion The Hobbs Company has already taken initiatives to change its image and target its markets more specifically. However by personalizing its contact points through direct marketing and making investment in store image, window displays and online marketing strategies, the company can significantly increase the footfall and traffic in its Birmingham stores. Currently the marketing budget for direct marketing strategies is limited to GBP 1,000 per store, however in the following years this budget will need to be increased to keep competitive and attract the target market to shop in-store. References SAMLI, A.C., 1998, Strategic Marketing for Success in Retailing, Greenwood Publishing Group: Online, available at http://books.google.com.pk/books?id=DbrZiDk0hZsC&pg=PA50&lpg=PA50&dq=SAMLI,+A.C.,+1998,+Strategic+Marketing+for+Success+in+Retailing,+Greenwood+Publishing+Group&source=bl&ots=EOeP0W0meC&sig=3whX27xB_RHjTL3jApACbnohIs8&hl=en&ei=G9HBSdu8E4_VkAWGy6zfCQ&sa=X&oi=book_result&resnum=1&ct=result#PPR7,M1 MCCRACKEN G.D., 2005, Culture and Consumption II: Markets, Meaning, and Brand Management, Indiana University Press: Indiana, USA SHU-CHING CHEN, QUESTER, P., 2006, Modelling store loyalty: perceived value in market orientation practice, Journal of Services Marketing, Vol. 20 Issue 3, p188-198, 11p, 2 charts, 1 diagram, available at http://web.ebscohost.com/bsi/detail?vid=1&hid=109&sid=9ce55327-479e-40d3-9f38-0e2effa7b961%40sessionmgr108&bdata=JnNpdGU9YnNpLWxpdmU%3d#db=buh&AN=21788599 Read More