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Value to Bottom Line

RMG925: Leading in Retail Service Organizations

  • Long term: Higher profit

  • Build brand loyalty

  • Increased positive word of mouth marketing

  • Ensure reliable sales and increase traffic

  • Gain a competitive edge

Conclusion

  • Overall, the problem facing the Adler Company is their unclear company strategy.

  • Vital to implement a strategy that will market, cater, and advertise to the bronze consumer segment.

  • Move forward and implement our new and enhancing competitive strategy to benefit Target Solutions.

Proposed Solution 3

Financial Impact

Costs for Loyalty Program

  • $30,000 to $100,000 to build app
  • $0.50 to $1.00 per loyalty card
  • $300 to $400 for gift card software per location

Potential Risks

- App technical difficulties

- Additional costs

- Lack of smartphones owned/used within our bronze market

- Coupons/Reward Program: T POINTS

  • Customer Loyalty Program
  • Focus: most value at lowest price
  • Responds well to traditional advertising methods
  • Send out monthly flyers that contain coupons

Submitted To:

Dr. Frances Gunn

Proposed Solution 1

Proposed Solution 2

- Alter Prices:

  • Current pricing is confusing
  • Need competitive pricing
  • Price = Key Differentiation

Proposed Solution 1

- Alter Prices:

  • Risk = Lowered Gross Margin
  • Goal = Produce higher returns and sustainability in long term

- Removal of Trendy Merchandise:

  • Utilitarian individual seeking low cost basic items
  • Not interested in high fashion or "new" styles
  • Fashion forward inventory does not resonate with our bronze customer

Proposed Solution 2

  • Silver and Gold purchase Core/Cosmetics at our store
  • Concentrate budget towards high performing items
  • Reduction of trendy merchandise will decrease costs, increase traffic, and overall increase revenue

Current Situation

Rational for Change

  • Capture the bronze segment and more proactively cater to their needs.

  • Bronze Consumer = 50% of our consumer segment

  • Composed of 2 groups:
  • Lower income individuals and financially stressed families.
  • Basic utilitarian customer

  • Take on more promotions such as white sales

  • Focus on more basic apparel and reduce trendy merchandise

Rationale for Change

Current Situation

  • 49% market share for Target Solutions

Reduction in Trendy Merchandise

Competitive Prices

Bronze Consumer

White Sales

Promotions

Business Case - Target Solutions - Group C3

By: Ashley Kim, Lauren Pearson, Daria Pienkowska, Michelle Quaranta & Andrew Yee

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