“ A STUDY ON EFFECTIVENESS OF ADVERTISEMENT AND PROMOTIONAL OFFERS AT BIG BAZAAR “

INDUSTRY PROFILE

INTRODUCTION

Retailing means selling goods from a fixed location. Variety of products are offered under a Single roof
by retail industries and Indian retail sector comprises of two main groups organise And unorganised
retail stores. Stores having wide range of products are mostly preferred by Indian customers. These are
also known as departmental stores.

Retailers are the chain between manufacturer and end consumers. The main purpose of retailing
Involves selling of goods and services directly to the end consumers. For fulfilling various needs And
wants they need to go to the retailers. Retailers come across the various demands of Customers through
target markets promotional strategies and satisfying their needs and wants Through supply chain
management. Services are being provided to individual as well as Wholesalers in small or large order by
the retailers. One of the easiest ways to access to the Consumers is through various promotional offers
given by the retailers. The Indian retail sectors Are the largest industries in India. Such retail industries
are covering more than 10% of Indian Employment opportunity.

RETAILING IN INDIA

The retail sectors are divided into 2 segments which are organised and unorganised retail sectors. At
currently, the organised retail sector is rising very rapidly. So, the retail sector is trying to Change the
lifestyle of Indian consumer. Presently the Indian consumers are well aware about Quality of product
and services.

Till 2012, the Indian government did not accept FDI on retail multi brands, any ownership in
Supermarket and also 51% limited ownership on single brand retail outlets. But in January 2012, Indian
government decided to give opportunity to a single brand retailer, they owned at 100% Ownership, but
they should 30% source from India and providing employment opportunities in India. In November
2012, the Indian government decided retail reform to liberalizing the Condition for multi brands and
single brand store. This way MNC entered towards Indian retail Market. Such as Wall-mart, Carrefour
and Tesco. Same way single brand also investing more in Indian retail store which are IKEA, Nike, Apples
etc.

Currently the Indian retail sector is growing positively. According to retail sector, 12 crore and Also
annual growing rate of retail sector is 5.7%. Majorly food and grocery retail stores Contributing 7.439
crore per annum of world highest retail in India only. Indian retail contributing more for GDP compared
to other countries and that is India 10%, USA 10%, China 8% and Brazil 6%. Indian retail sector working
favourably to the customers, we can See some favouring works.

 Indian retail sector improving in purchasing power of customers through per capital income.

 Retail sectors promoting use of credit card facilities.

RETAIL FORMATS IN INDIA

 Specialty Stores

It is a single brand specialty stores and providing best services to customers. Reebok and Manchester
United stores are example of this.

 Departmental Stores

It is carrying variety of products and wide trange of assortment at lower price than other store to
Customers. Example is food world.

 Convenience Stores

It is located in residential areas, customer can buy immediately and that is why that quite of high Price
and quality of products. Example is Reliance Fresh.

 Discount Stores

They sell huge products but less than MRP rate. In this Stores give preferences to the Manufacturer
brands. Example is the Loot.

 Hypermarket

It is located at fixed area and providing variety t of products at affordable prices to consumers And
providing best services to the consumers and carrying of consumers.

 Supermarket
It is selling mainly grocery and non-food products. Example is spar.

 Malls

It is located mainly in big cities and consisting high quality products. It is providing products,Food and
entertainment in single outlet. Example is Orion.

 Vending Machines

This system is not popular in India. Actually, it came recently. This is an automatic machine, in Which
customer can put money and take the product immediately.

CHALLENGES FACED BY INDIAN RETAIL INDUSTRY

 Huge Competition between organized retailers and unorganized retailers.

 Unavailability of supply chain management in retail sectors.

 Indian retail sector is growing very fast and the demand is increasing day by day.

 Indian based infrastructure is having very low level in Indian retailing.

 Negative response is being observed in retail sector related to Indian tax system and stamp
duty.

 Indian retail industry is facing shortage in goods value and administrative error.

 Unavailability of skilled labors in Indian retail sectors.

 Indian government is having more restriction related to foreign direct investment.

 There is no recognition of Indian retail sector as an industry till now.

PESTLE Framework

PESTLE Analysis of Big Bazaar analyses the brand on its business tactics. Big Bazaar PESTLE Analysis
examines the various external factors like political, economic, social, technological (PEST) which impacts
its business along with legal & environmental factors. The PESTLE Analysis highlights the different
extrinsic scenarios which impact the business of the brand.

PESTLE analysis is a framework which is imperative for companies such as Big Bazaar, as it helps to
understand market dynamics & improve its business continuously. PESTLE analysis is also referred to as
PESTEL analysis.

Big Bazaar PESTLE Analysis:

Political Factors:

The political factors in the Big Bazaar PESTLE Analysis can be explained as follows:

Big Bazaar being a retailer should be benefitted the most if government is looking forward to growth in
such industries or not. The present economic situation affects the government’s budget which includes
the fiscal and monetary policy, thereby affecting the consumers purchasing powers and the growth of
the industry. Government that encourages new technology will be beneficial for the company as it
would allow them to operate efficiently. Political stability and government policies may also affect Big
Bazaar to a great extent. This includes abiding by laws when setting prices, doing marketing and overall
business operations in general for its smooth running. The consumer protection measures taken by the
government should also be well analyzed. Level of restriction on foreign goods by government also plays
a major role in measuring the ease of serving variety to Indian market. Apart from this, a stable
government would also encourage investment thereby making the shareholder’s happy.

Economic Factors:

Below are the economic factors in the PESTLE Analysis of Big Bazaar:

The pace of growth of the economy is a major lookout for a retail store like Big bazaar.This is because
that is what would help to decide the range of products that should be stored in larger quantities. It also
helps in determining the cost of doing business and thereby estimating profits. This would further help
in analyzing feasibility and prospects of long-term sustainability. Employment rates, inflation rates, price
fluctuations in the markets, Availability of capital at reasonable rates, level of household incomes and
saving rates and consumer disposable income are some of the major factors that could affect the
operations of the company. The level of income inequality in an economy also depicts the level of crime
that can take place and can lead to uncertainty of consumption. Thus, all these factors are very
important for long-term analysis of growth prospects for the company.

Social Factors:

Following are the social factors impacting Big Bazaar PESTLE Analysis:

Having such a vast category of products, various social factors would affect Big Bazaar. Starting from
birth-rate to estimate future demand, analysis of average age, gender ratio, culture and diversity would
all have an impact on what the consumers would expect from the brand. State of health and the type of
products people would like to buy constitutes one of the most important macro-economic factors
affecting the company. Lifestyle changes, shift in product and services preferred are changing at
increasing pace and Big Bazaar needs to ensure to chase down the same pace in order to sustain, serve
and maintain its loyal customer base. The attitude of people towards saving their money for future or
investing in different industries must also be looked upon. All these factors need to be considered not
only for determining business operations but also for choosing the right marketing campaigns to
position the brand in the minds of potential customers.

Technological Factors:

The technological factors in the PESTLE Analysis of Big Bazaar are mentioned below:

Accepting all modes of payments would be one technological factor that would affect Big Bazaar a lot
with the increase in number of upcoming applications, UPI’s, Wi-Fi cards and various other methods of
payments. Adapting to the speed of technological innovations is thus a major factor. Developing a fast-
billing system would also involve using the latest and the best technology to maintain operational
efficiency. Providing online services through well-developed applications is also a key pointer for Big
Bazaar to survive in the long run. Other facilities like home delivery, ease of shopping, ambience, and
supply chain management must be taken care of. Technology would be impacting the company in two
ways, directly via the technological factors affecting the industry and indirectly via the affect of
technological factors on the individual brands which it sells.

Legal Factors:
Following are the legal factors in the Big Bazaar PESTLE Analysis:

Employee laws and consumer protection laws would have major impact on Big Bazaar as the business
model requires engagement of large number of employees and it needs to take care of its customers
and their problems even after sales. The expiry dates of products and quality check of products should
be done on regular basis depending of the requirement of each category. Business laws need to be
analyzed before opening stores in certain areas. As there are several customers who would be visiting
the stores on daily basis, safety regulation and protective measures must be in place. Trade practices of
the location they are operating in must be abided by and ensure best service, quality and products to
obtain a competitive advantage over competitors. This would help them avoid any legal challenges
which in turn also take a lot of time to conclude.

Environmental Factors:

In the Big Bazaar PESTLE Analysis, the environmental elements affecting its business are as below:

Proper waste management is one of the major environmental macro-economic factors affecting Big
Bazaar. Regular assessments of products expiry must be done and products not sold must be disposed in
an organized manner. Focus must shift to spending on renewable technologies and adapt to eco-friendly
methods. The selection of location must also be appropriate such that the environment isn’t affected.
Another major area to focus for the brand is in the type of carry bags it provides and the bills it prints.

It should discourage excess printing. Big bazaar should also convince the brands that they sell to adapt
to greener packaging and contribute to corporate social responsibility as a result. This could be mostly
directed towards the fast-moving consumer goods sector so as to minimize non-degradable wastes.

To conclude, the above Big Bazaar PESTLE Analysis highlights the various elements which impact its
business performance. This understanding helps to evaluate the criticality of external business factors
for any brand.

Porter’s Five Analysis

Big Bazaar has acquired a variety of companies that helped it in diversity and growth of its item’s profile.
This is the thorough description of the Porter’s design of 5 forces of Big Bazaar Company.

Competitiveness

There is extreme competition in the market of food and beverages. Big Bazaar is among the top business
in this competitive market with a variety of strong rivals like Unilever, Kraft foods and Group DANONE.
Big Bazaar is running well in this race for last 150 years. Each business has a definite share of market.
This rivalry is not just limited to the price of the product however also for quality, innovation and
variation. Every industry is making every effort hard for the maintenance of their market share.
However, the competitors of other business with Big Bazaar is quite high.

Threat of New Entrants

A variety of barriers are there for the new entrants to happen in the customer food market. Only a few
entrants be successful in this market as there is a requirement to understand the customer need which
needs time while recent rivals are aware and has actually advanced with the consumer commitment
over their products with time. There is low danger of brand-new entrants to Big Bazaar as it has rather
large network of distribution globally dominating with well-reputed image.

Bargaining Power of Suppliers

In the food and drink market, Big Bazaar owes the biggest share of market requiring higher number of
supply chains. This triggers it to be a picturesque buyer for the suppliers. Any of the provider has never
ever revealed any grumble about price and the bargaining power is likewise low. In action, Big Bazaar
has actually also been concerned for its providers as it thinks in long-lasting relations.

Bargaining Power of Buyers

There is high bargaining power of the buyers due to excellent competitors. Switching cost is quite low
for the customers as many business sale a number of comparable products. This appears to be a great
risk for any company. Thus, Big Bazaar makes sure to keep its customers pleased. This has actually led
Big Bazaar to be one of the loyal company in eyes of its buyers.
Threat of Substitutes

There has actually been a great risk of replacements as there are replacements of some of the Nestlé’s
products such as boiled water and pasteurized milk. There has actually also been a claim that some of its
items are not safe to utilize leading to the reduced sale. Therefore, Big Bazaar started highlighting the
health advantages of its items to cope up with the replacements.

Competitor Analysis

It has ended up being the second biggest food and drink market in the West Europe with a market share
of about 8.6% with just a difference of 0.3 points with Big Bazaar. Big Bazaar brings in regional
customers by its low cost of the item with the regional taste of the products keeping its first location in
the worldwide market. Big Bazaar business has about 280,000 employees and functions in more than
197 nations edging its rivals in lots of regions.

COMPANY PROFILE

History of the Organization

Retail division is the quickest developing area & Big Bazaar is a part of Future Group, founded by Mr.
Kishore Biyani, a chain of hypermarket in India, composed as an agglomeration of bazaar offering and
extensive variety of products.

Big Bazaar established: 2001, "It Happened in India" - Kishore Biyani: 3C Balance hypothesis by Mr.
Biyani which portrays India's 3 battling classes. It additionally recounts overcoming adversity of Big
Bazaar and how the new idea developed about "Isse Sasta Aur Accha Kahin Nahin "now changed to
"Naye India Ka Bazaar"

7’s Framework

 Shared Values: In Big Bazaar the shared values are those which help in maintaining customer
loyalty and increasing repeat sales. The trust of high quality products at a reasonably low price
 compared to other retail outlets and through launch of various schemes and offers to attract
customers by giving them discounts and payback points.

 Strategy: As far as Big Bazaar is concerned it is basically price skimming and price penetration
strategy that is used to get the maximum benefit in the short-run. Introduction of offers,
membership cards, payback coupons, redeemable points and exchange offers help in attracting
customers to get more involved and interested on doing more shopping than anywhere else.

 Structure: There is a clear chain of command and hierarchy where each individual knows his
position and reports to his/her superior for any grievances or other work related issues. There is
proper coordination pattern and each team member is aligned to his/her set team leaders and
department mangers for performance supervision and appraisal purpose. There are weekly
meetings with each department manager and his team leaders where each team member is
present and the store manager takes a note of targets to be achieved and how to increase sales
which are compared to previous year’s sales and revenues. This is done constantly and
monitored by department managers daily.

 Systems: There is a well organized and monitored centralized system in place that does
sometimes real time checking of inventory to monitoring of stock turnover. Daily targets are set
using MS Excel sheets wherein each individual is provided with daily, weekly and monthly
targets to be achieved and also performances are measured using this. Also at the cash counter
there is software in place that alerts the main logistic department about which products are in
excess stock and which are fast depleting. This is done through bar-coding each and every item
for sale in the company. Also for security purpose the items are tagged and employees also
checked for any shop lifting or other such activities. There are strict protocols that help in
constant monitoring and maintaining daily activities in each department.

 Staff:

1. Each individual employee’s position and specialization are represented within the team. Starting
from the top there is a Store Manager, Asst. Store Manager, HR Manager, Department Manager,
Team Leader and other Team members who function in coordination with each other on a daily
basis.

2. Other positions in various other departments are also managed by the store manager through
delegation of work through assistant store manager.
 Style: Centralized chain of command in which there is way of hierarchy and decisions are mostly
from the top management that are carefully drafted and implemented at various branches.

 Skills: The management pays attention to training and development of each and every employee
from top to bottom and there are sessions and meetings for the same purpose. Each employee
before joining the organization undergoes training on how to handle each and every
department work and follow certain code of conduct required, grooming, dressing sense,
training on various aspects of window dressing and color blocking, customer service and how to
behave in order to make the customer feel more happy during the whole shopping experience,
how to handle customer complaints and respond in various situations.