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7/30/2019 Reatil Marketing

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Retail MarketingProf. B. K. Kumar

Term III

PGDBM Program AY 2012 14

(July Batch)

Mohit Daga

Sec H

20thMay2013

A COMPARATIVE STUDY -:

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TABLE OF CONTENT

1 .SAMSONITE BACKGROUND

2.VIP BACKGROUND

3 . 7P S INTRODUCTION

PRODUCT

PRICE

PROMOTION

PLACE

PEOPLE

PACKAGING

POSITIONING

4. A STUDY ON SAMSONITE & VIP

5. G LOBAL LUGG AGE IND USTRY.


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Founded in 1910, Samsonite has kept itsheritage of more than 100 years, to createstylish and high quality solutions for the

world traveler intact.

Samsonite Corporation started its

India operations in 1996 as SamsoniteSouth Asia Pvt. Ltd. It is a 60:40 joint

venture formed with the esteemed

Tainwala family. Currently, Samsonites Asia operations

span SAARC, China, East Africa. Samsonite is the leading worldwide brand

in superior travel bags, luggage and

accessories, combining notable style with

the latest design technology and utmost

attention to quality and durability.

FACTS-:1. Year of first store launch: 2000

2. Total number of outlets at

present: 232 (Malls: 42; High-

Street: 190)

3. Total number of outlets

expected by 2012: Companyowned: 90; Franchised: 200+

4. Target consumers: 25 to 50,

SEC A1 mid to senior level

executives/ entrepreneurs

5. Region with strongestpresence: South

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Established in 1971, VIP Industries Limitedis the flagship company

of the Dilip G PiramalGroup. Since its inception, VIP luggage has

sold over 60million piecesaround the worldand has today become

an epic brand synonymous with the word travel in India. It is today the largest luggage brand in Asia and the second

largest manufacturer of moulded luggage in the world.

In the organized Indian luggage market, VIP leads all other

brands with a dominant 60% market share with its products

reaching over 8000 retail outletsacross the countryand over 1300

outlets spread across 5 continents in 27 countries.

VIP acquired the brand Carlton in 2004 (presence in 65 countries),which is the chosen vehicle for global expansion.

FACTS

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Once you've developed your

marketing strategy, there is a

"Seven P Formula" you should

use to continually evaluateand reevaluate your business

activities. These seven are:

product, price, promotion,

place, packaging, positioning

and people.

As products, markets,

customers and needs change

rapidly, you must continuallyrevisit these seven Ps to make

sure you're on track and

achieving the maximum

results possible for you in

today's marketplace.

PRODUCT PEOPLE

PRICE PLACE

PROMOTION PACKAGING

POSITIONING5


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It must provide value to a

customer but does not

have to be tangible at the

same time. Basically, it

involves introducing NEW

PRODUCTS OR IMPROVISING

THE EXISTING PRODUCTS

VIPcreate thoughtful , stylish & innovative

products to make travel more joyful and

simple. With a very short history as

compared to Samsonite, VIP has still

managed to grab the 2nd

the position ofworlds 2nd largest luggage manufacturer.

Stylish products with excellent features built

into a brilliant design, made VIP a much

sought after brand in the expanding luggage

market.

Samsonite has embedded its

place at the forefront of the travel

world with a number of industry

firsts. Showing commitment to

innovation every step.

A wide spectrum of business,

casual and personal accessoryproducts in upholding Samsonites

position as a market leader and

trendsetter. Always looking

forward by identifying trends and

the continuing evolution of global

traveler's needs, Samsonitemaintains a worldwide vision that

continues to enable travelers to

travel further, with ever lighter,

stronger and more innovative

products at his side.


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Samsonite operatesin the mid to high-end segment

(with its range starting from Rs

5,500 and going up to as high as

Rs 85,000), while its second

brand, American Tourister,

caters to the 'mass with a class'

or those masses that don't mind

paying a little extra for better

quality (the brand's range starts

at Rs 2,700).

VIPhas wide range of products and serves

across the world specially the south Asian

region under various brand name

VIP(mid-range product ranging from Rs.

325 to Rs. 8900), CARLTON(premium range

product ranging from Rs. 2200 toRs.17000), ARISTOCRAT ,SKYBAGS, ALFA

etc.

The price is very

important as it determines

the companys profit andhence, survival. Adjusting

the price has a profound

impact on the marketing

strategy


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Promotion represents all of the

methods of communication that a

marketer may use to provide

information to different partiesabout the product.SAMSONITE, campaign using 360

degree model. Our flagship brand

Samsonite operates in the premium

consumer segment while American

Tourister is for the mid-level consumer.

A consumer buys Samsonite because

he wants Samsonite. That is why in all

our campaigns, we do not talk about

any features or strengths of our

product. But American Tourister

consumers want an assurance from the

brand about what they are buying and

so there is more rational advertising.

Carlton is a distinct product which

is designed for the European

market. With this brand we are

targeting the premium end of the

market. VIPis in the middle of the

market. This is in the mass

premium segment as well as in the

popular market. We are looking to

target younger consumers in

various ways. SKYBAGS is the

stylish offering.Aristocratis our

value for money product. People

have bought it as it is a big brandwith strong equity.


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SAMSONITE, associated with the

FILM my name is khan in the past

and oo7 recently. The company is

also looking at online brandingseriously, including branding on

travel sites, technology/gadget

oriented sites (which the business

traveler may frequent).

To reach out to young customers

who don't mind paying a slightpremium for their travel gear,

Samsonite and American Tourister

have created pages on social

networking sites such as Facebook

and Orkut and also have their

presences on Twitter. Our channelmix is changing.


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VIP recently launched a niche

eco-friendly bag called Acura.

People are getting conscious

about carbon footprint. Acura

range in partnership with Du-

Pont is very eco-friendly. We are

also launching new

polycarbonate range under VIP

and Skybags.The co. is also looking to launch

a range of luggage for women

called Diva, given the rise in

women travelers. These are

lightweight bags specially

designed for women travelers.As a market leader, we are

looking to enter more niche

markets and in due course make

them bigger.


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Place refers to providing the

product at a place which is

convenient for consumers toaccess. Place is synonymous

with distribution. Various

strategies such as intensive

distribution, selective

distribution, exclusive

distribution & franchising canbe used by the marketer to

complement the other

aspects of the marketing mix

VIP has operations across the globe in 5continents. It has offices in the USA,

South Asia, Middle East, Africa and

Europe. Worldwide,

VIP products are sold across 1300 retail

outlets in 27 countries.Brand Carlton has a presence in 65

countries across the globe and has its

offices at London, Dubai & Hong Kong.

The Hong Kong office is also the product

development and sourcing office for

domestic as well as internationalbusiness.

There are 17 exclusive stores in

Bangalore.


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There are 38 authorized dealers

in Bangalore.

In 2010, our products were

sold in more than 37,000

points of sale in over 100

countries through a variety of

wholesale and retail

distribution channels.Our market-leading position

results from our strong

international brand presence,

our significant scale, our

robust investment on

advertising and product

innovation, our scalable

distribution and sourcing

ability, and our market-

leading, high quality products.


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There are people

inside and outside

of your business

who are

responsible forevery element of

your sales and

marketing strategy

and activities

Improving the terms of trade and business

relationships with certain key third-party

suppliers to achieve a reduction in the

price of products sourced from them; and

negotiating lower freight prices, with

efficient executives . To create a competitive advantage,

Samsonite is now spending 9% of its saleson sales and marketing and $10 million a

year on product designing.

VIP focusing on creating barriers to entrythrough brand building, R&D and

Economies of Scale and Scope.


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People form their first impression

about the product within the first

30 seconds of seeing you or some

element of your company. Small

improvements in the packaging orexternal appearance of your

product or service can often lead

to completely different reactions

from your customers.

SAMSONITE -simple ,easy to use anddurable but the technology used is

sophisticated.

For example -: Curvtechnology is an

advanced impact-resistant, lightweightmaterial. Samsonite has

formulated the process to create the

ultra strong material by weaving fibres of

durable

polypropylene together, transforming

them into individual sheets which arequickly

reinforced and fused together to form

Cosmolites outer shell.

VIPit focuses one brand at a time

and innovates. The co. targets the

youth with its colorful and durable

Skybags, lures the business segment

with finesse leather bags.


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How do people think and

talk about you when

you're not present? How

do people think and talk

about your company?What positioning do you

have in your market, in

terms of the specific

words people use when

they describe you and

your offerings to others?

Skybags have come up with a clearpositioning, that of projecting your baggage

as a fashion accessory, making a statement

of its own. Samsonite comes up with Step

Out with Samsonite. This positioning talks

about encouraging travel, which is sort of

awkward, because baggages are dependenton travel and not the other way around.

Skybags positioning is also more youth-

centred compared to Samsonite, and inour county, that can never be wrong.

An interesting thing common to both

the campaigns is that both talk about

the need of the product as an

indispensable part of the consumers

life. They dont discuss functionality

or craftsmanship at all. I am not sure

whether this market has evolved

enough to move away from

functionality.


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A STUDY ON SAMSONITE AND VIP

Samsonite is the second largest luggage

brand in India trailing behind the marketleader VIP. Samsonite is known for its

premium luggage with major attribute

being the strength and sturdiness.

The Indian luggage market is huge with a

market size of Rs 2000 crore. But majorityof the market is dominated by unbranded

local players. The organised luggage

market is only Rs 950 crores.

VIP has a commanding market share of

80 % in the organized segment and

Samsonite is having around 15-20%

share.


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When Samsonite was launched in India, it took on the fight directly with VIP by making

the brand affordable to the Indian consumer. But in 2005, the brand took a major

repositioning exercise by positioning the brand as a luxury brand. The repositioning was

done using a series of print campaigns in leading magazines. The product portfolio was

also rejigged by the inclusion of lot of bold colors and shapes.


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The global luggage market has been forecast to hit a market value of US$50 billion by

2018, driven by the recovery in travel and tourism around the world. Growth is likely to

be fuelled by emerging economies, owing to the increase in both leisure and business

travel.

The popularity for outdoor sports, tourism, and adventure travel is increasing the demand

for specialty luggage products that augment comfort, convenience, and utility to sportstravel experience.

Moreover, luggage makers are enhancing their product lines by using faux leather and

microfiber for manufacturing purposes, and offering them in sophisticated colors such as

burgundy, blue, orange, and lime green.

Luggage manufacturers across the globe are increasingly focusing on targeted advertising

and promotion activities as well as on research, development, and designing of new

products. Further, luggage as a fashion accessory has recently become a norm in the

global market leading to its increased usage.


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This in turn has encouraged the global suppliers of luggage to constantly innovate

in order to meet the evolving needs of consumers. Moreover, lately, the need forbetter and expanded distribution network with new points of sale has also gained

importance. Samsonite luggage

Competition in majority luggage markets worldwide is based on the finest brand

name, product quality, product design, and price. Other important parameters

include consumer advertising, product differentiation, innovation, and customerservice.

Entry barriers for competitors in the soft-side luggage market are comparatively

lower than the hard-side market as hard-side luggage production is more capital

intensive, while soft-sided is labor-intensive.

Samsonite remains the undisputed leader in the global luggage market, followed

by VF Corporation, Tumi, Ace, Delsey, VIP, and Rimowa, among others. Major

players including Samsonite, are continuously engaged in developing luggage with

sophisticated technology, focusing on lightweight and solidity, security and storage

features.

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