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ADVERTISING
&
SALES PROMOTION Salesforce & Channel Distribution
Assignment
ABSTRACT The case-study is about the Advertisement &
Sales Promotion of Randall’s Department Store
and contains data analysis.
SUBMITTED BY
Darshil Dholakia - 15021141016
Rupesh Jha - 15021141050
Siddharth Desai - 15021141060
SUBMITTED TO Dr. B. R. Londhe Professor & Deputy Director
INTRODUCTION
Randall’s was a downtown department store in Bilingsville had 12 branches. It was founded
by Elliote O. Randall who opened the downtown Bilingsville stores in 1890. Descendants of
the founder continued to play major role in the management of the company. All were
situated in an upper Midwest state in a trading area of approximately 3.7 million inhabitants
that encompassed Bilingsville, a major city and its surrounding area.
Emily Randall and Caroline Randall were president and Chairman of the board respectively.
The reporting structure within Randall’s was similar to that in many traditional department
stores. The three General Merchandise Mangers (GMM) & The Vice President for sales
promotion and for the stores reported to Emily Randall.
ADVERTISEMENT
Print Media
• Including Inserts in Local Sunday Newspaper advertising and catalogues. It
was mainly used for “Sales” advertisements, because price reduction on the
numerous items could be communicated efficiently. Both Sunday Inserts
(upto 60 pages of color presentation showing sale & regular price as well as
Value Price Merchandise) and ROP (Run of Press) were used for Sales
Advertising. ROP ads were black & white advertisements within the body of
newspaper itself.
• The Women’s division also used ROP advertising, often with quarter and full
page illustrations or photographs of single garment. Such ads typically
appeared on Mondays & Tuesdays and emphasized in – Season, full priced
fashion merchandise
Television & Radio
• Major storewide sale events were advertised on Television, Radio as well as in
newspapers.
• Substantial portion of advertisement used to be done on television on
Thursday & Friday for weekend days.
Advertising budget
• Randall’s advertising budget included both funds for “general” advertising and
“GMM” locations.
• General advertising expenditures included outlays for major Store-wise sale
events.
• Funds allocated to “GMM” (General Merchandise Manager) were distributed
to their Divisional Merchandise Manager. This funds were used for the
focused events like ‘The Home Stores White Sale’ and to pay for any
additional Sunday Inserts done at the discretions of GMMs.
Focused Supplemental Advertisement
• During Store wide sale period (for fashion ROP advertising, and for any
catalogue advertising).
SALES PROMOTION
• Extra Value Days sales events
• Pre-season sale (on coats & shoes for women)
• Direct Mail Advertisement ( 3 % off coupons )
• Anniversary sales and Coupon discount
• Every Day low Pricing (Women’s Fine Jwellery, men’s suits, children clothing)
• Cohesive Price Strategy.
• Focused events like the Home Store’s White Sale.
• Store wide and divisional sale events.
• 4 Day Extra Value sale event in a month.
• 1 Day Extra Value sale Special Red Extra Value day signs to highlight extra value
merchandise.
• Some specific store wide sale specific to certain geographic location- Billingsville
Saturday sale, Bargain weekend sales in suburban stores.
• Incentive based compensation, commissioned sales staff.
Promotional Calendar
CONCERN OVER ADVERTISEMENTS & SALES PROMOTION
• Sales advertisement more on print media than on television.
• Reduced circulation of print media and tendency of younger consumer not to be
heavy reader.
• Excess use of ROP and Sunday inserts resulted in visual clutter.
• Too much dependence on weekend sale events (more than 25% sales used to happen
in “4 day Extra Value sale” in a month.
• To achieve above newspaper as well as television advertisement used to be done on
every Thursday and Friday. So more sale on crowded weekend as compared to free
weekdays.
ANALYSIS – RANDALL’S HISTORICAL ADVERTISING
EXPENDITURE
• CAGR- Spring ( 1983-1989) = 15.49 %
• CAGR - Fall( 1983-1989) = 22.47%
• CAGR - Total( 1983-1989 ) = 15.49 %
• There is a decrease in advertisement expense from 1988 to 1989 though the total sales
had increased.
Total Advertisement Expense on Radio and Television
D.H Humphrey < Randall’s < Prescott’s
ANALYSIS ON ADVERTISING EXPENSE ON SELECTED BRANDS
• Total Advertising Budget(Gross Advertising Budget ) = “Net Advertising Dollar” + “
Co-operative Advertising Dollar”
• Co-operative advertising dollar often higher than the DMM advertising Fund.
Category Ad. Expense ($) DMM Fund $ (Internal) Cooperative Fund $( Vendors)
Children 434435 301920
Fine Jewellery & Fashion Accs. 678810 852465
Décor. Home Furnishing 901170 1302625
Men’s clothing 525045 551140
Women’s Clothing 636055 487645
CONCLUSION
Advertisement is an important aspect for a business like Retail Store which keep
offering various schemes on day-to-day basis. Randall’s were too much dependent on
this schemes like ELDP, Extra Value Day, etc. which is not viable solution for
sustainability.
A Business offering such schemes on daily basis does not survive for long period of
time and also adversely affects the brand name.