India’s Rs. 10,000 crore footwear industries is one of the faster growing markets (10-11 per cent) and offer significant opportunities. In terms of footwear volumes, it is next only only to China with an annual domestic consumption of approximately 1.1 billion pairs per annum.
A large young population, growing quality consciousness and increased relating would ensure that the Indian market would gravitate towards branded segments, thus shrinking the share of unbranded footwear from the present levels of 60 percent.
In the branded space, Bata India’s vast experience, massive distribution reach through exclusive show rooms and, a large product portfolio (from “value for money” to “premium” range) has helped it drive growth.
Further, planned retail expansion to seize opportunities in this growing market would shore up revenue growth and the completion of restructuring of operations (and focus on costs) would ensure profitable volumes going ahead.
Only one-fourth of total domestic footwear sales happen through organized retail outlets. Bata with over 1,200 outlets (largest in India) holds an edge over other retailers in terms of reach (its nearest rival has a reach, which is just a third of Bata). To maintain its head start, Bata is adding 50-60 new stores annually.
Besides expansion, remodeling of its old stores to international standards is in progress to attract higher footfalls (customers). These measures would help drive up the revenue growth above Bata’s give-year average of 6 percent to about 15 percent in the next two years.
The other area of focus for Bata is ladies footwear, a market which occupies around 40 per cent of the total market and where around three-fourth of the market is dominated by the unorganized sector.
Historically, ladies have been seen as price sensitive customers but, the greater purchasing power and brand consciousness in the modern times is expected to gradually lead to a change in consuming habits of ladies in the future. Bata has a presence in all the price segments in the ladies footwear segment.
With men’s segment providing relatively stable growth, the ladies segment has evolved as the fastest growing segment. In terms of proportion of sales, ladies segment is lower than the industry average and offers greater opportunities for Bata in the future.
Questions:-
1) What would be the demographic and psychographic profile of the target audience for Bata footwear? (6 marks)
2) What sales promotion would you recommend to induce purchase of Bata footwear? (6 marks)
3) Suggest any two IMC tools other than Sales promotion to promote Bata footwear? (8 marks)
(April 2009 Case Study of Special Studies in Marketing)
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