Kmart Marketing Strategy
Agenda
• • • • • • • • • • Organizational Overview Industry Snapshot Competitor Analysis Financial Analysis SWOT Overview Current Strategy Strategic Issues Recommended Solutions Implementation/Justification Recommendation Recap
Organizational Overview
• • • • • • Founded by Sebastian S. Kresge in 1962 Number 3 discount retailer in the U.S. Operates 1,479 stores in 49 states Maintains 3 retail concepts Filed bankruptcy in 2002 Merged with Sears, Roebuck & Co. in March 2005
Industry Analysis Key Success Factors
• Advanced technology that enables
Technology
merchandising efficiency
Distribution
• Efficient Supply Chain Management • High return on inventory investment/high inventory turnover • Good working relationship with suppliers • Low distribution costs • Low replenishment cycle times • Ability to predict consumer demand • Courteous customer service • Breadth of product line and brand selection • High sales per square footage (store productivity) • Effective merchandising strategies • Ability to meet local preferences and price sensitivities • Overall low costs and underpricing strategies • Convenient store locations
Marketing
Skills & Capability
Other types
Kmart’s Microenvironment
Economic Conditions
Rivals
Substitute Products
Technology
Legislation/ Regulations
Suppliers
Buyers
New Entrants
Society Values/ Lifestyles
Demographics
Disposable Personal Income
Retail Sales Approaching 41.5% in 2005
Consumer Confidence is beginning to rise
Competitive Analysis
High
Low
Variety
High
Low Price
Competitive Analysis
Expensive
Low
Variety
High
Inexpensive Price
Product Line Strategy
A time phased plan for introducing products, each product targeting a specific target market How Targets: African American Hispanic Asian American
Use unique strategic brand alliances Advantages and licensing agreements that are culturally specific to our target market
Favorable
• • • • • • • • • • Organizational Overview Industry Snapshot Competitor Analysis Financial Analysis SWOT Overview Current Strategy Strategic Issues Recommended Solutions Implementation/Justification Recommendation Recap
Organizational Overview
• • • • • • Founded by Sebastian S. Kresge in 1962 Number 3 discount retailer in the U.S. Operates 1,479 stores in 49 states Maintains 3 retail concepts Filed bankruptcy in 2002 Merged with Sears, Roebuck & Co. in March 2005
Industry Analysis Key Success Factors
• Advanced technology that enables
Technology
merchandising efficiency
Distribution
• Efficient Supply Chain Management • High return on inventory investment/high inventory turnover • Good working relationship with suppliers • Low distribution costs • Low replenishment cycle times • Ability to predict consumer demand • Courteous customer service • Breadth of product line and brand selection • High sales per square footage (store productivity) • Effective merchandising strategies • Ability to meet local preferences and price sensitivities • Overall low costs and underpricing strategies • Convenient store locations
Marketing
Skills & Capability
Other types
Kmart’s Microenvironment
Economic Conditions
Rivals
Substitute Products
Technology
Legislation/ Regulations
Suppliers
Buyers
New Entrants
Society Values/ Lifestyles
Demographics
Disposable Personal Income
Retail Sales Approaching 41.5% in 2005
Consumer Confidence is beginning to rise
Competitive Analysis
High
Low
Variety
High
Low Price
Competitive Analysis
Expensive
Low
Variety
High
Inexpensive Price
Product Line Strategy
A time phased plan for introducing products, each product targeting a specific target market How Targets: African American Hispanic Asian American
Use unique strategic brand alliances Advantages and licensing agreements that are culturally specific to our target market
Favorable