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Copy of Michael Hill Jewellers

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Chris Garcia

on 4 December 2013

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Transcript of Copy of Michael Hill Jewellers

Michael Hill Jewellers
Strategy to Success
Created by Mary Shaw, Stephanie Grice, Chris Garcia, Quinton L'Hota & Jaime Sanft
Michael Hill Jewellers
"Adorn The Distinguished"
The Problem
Jewelery market is saturated

Mature stage in product life cycle and decline is inevitable

Increase in competitors due to online shopping

Lack of differentiation
Brand
The Watch & Jewelery Retailing Industry

MHJ Ltd Market Share: 6.6%
Prouds Jewellers Pty Ltd Market Share: 12.4%
The Jewellery Group Pty Ltd Estimated Market Share: 3.9%
Zamels (90 stores) and Mazzucchelli's (29 stores)
Tiffany & Co (Australia) Pty Ltd, Estimated Market Share: 2.5%
The other companies are making up the market share of 1.5% made of Wallace Bishop, Shiels, Grahams, Bevilles and Thomas Jewellers
SWOT Analysis
Strengths
A well known name in the market
Vertically integrated business
Store design and ambiance
Economies of scale
Weaknesses
Geographical concentration
High inventory
Over-dependent on a single region
Threats
Rising labor wages
Intense competition
Profusion of imitative products
Opportunities
Business expansion into other geographies
Rising popularity of online ecommerce
Growing global jewellery market
Perceptual Map
Porter's Five Forces
Market Strategy
Market Strategy
short term
Rebrand and Reimage Stores

Deliver a clear message
Confirms credibility
Connects emotionally
Motivates the buyer
Concretes user loyalty
Market Strategy
short term
Reduce Printed Sales Promotions by 80% in six months

Currently ...

Consumers who are exposed to constant promotional pricing are less likely to purchase at full price and instead will wait for the next sale (Kilwani & Yim, 2008).
Market Strategy
short term
Increase Customer Database & Positive Customer Service Responses by 40%

Increase knowledge of customer
Precise segments
Demographics
New, active or churn customers
Average spend
Past purchases/interests
Gain loyalty and recognition by sending consumers information and material that is relevant and attractive to them.
Market Strategy
short term
Increase Customer Database & Positive Customer Service Responses by 40%

Increase knowledge of customer
Precise segments
Demographics
New, active or churn customers
Average spend
Past purchases/interests
Gain loyalty and recognition by sending consumers information and material that is relevant and attractive to them.
Market Strategy
short term
Implement Intensive, High Quality Staff Training

Offer superior service
Create a personal experience
Staff will be trained in:
In depth history and product knowledge
Cultural aspects
Importance of post-purchase service
Internal Marketing Communications Plan
short term
Rebrand and Reimage Stores & Online

Phase out old marketing materials
Introduce new marketing material
Gold, charcoal and purple colour scheme
Reduce content on each page
Only show the product, not displaying the price

Will be done over a 6 month period
Starting within New South Wales and Victoria then rest of the country.
Internal Marketing Communications Plan
short term
Customer Data

Record all purchases into database and collect relevant information
With the price increase, introduce programs that reduce post purchase dissonance:

Email customers after purchase, congratulating the purchase and inviting them back to the store if any issues arise
Database will recognise a repeat purchase andwill notify shop attendant to ask them if they enjoyed their last purchase.

Send direct marketing information, tailored to their previous buying habits
Introduce this database to all MHJ across Australia over 6 months. Starting in New South Wales and Victoria then followed by the other states of Australia.
Internal Marketing Communications Plan
short term
Rebrand and Reimage Stores & Online

Phase out old marketing materials

Introduce new marketing material
Gold, charcoal and purple colour scheme
Reduce content on each page
Only show the product, not displaying the price

Will be done over a 6 month period

Starting within New South Wales and Victoria then rest of the country.
Internal Marketing Communications Plan
short term
Customer Service

Retrain staff in a six week program to:
Understand customers buying behaviour and tailor their approach
Understand cultural differences

Each city centre will host a six week part-time training course

Staff will be continued to be paid normal wages while attending these sessions

The specialised training crew will begin in NSW and continue across Australia.

Internal Marketing Communications Plan
short term
Reduction of Sales Promotions

Slowly reducing the amount of sales information on marketing material over a six month period

Market Strategy
Mid Term
Short Term
Marketing Strategy
mid term
Maintain and Extend on Customer Loyalty
(new and current)

Following the short-term objectives to increase customer service responses, we will build a wider range of loyal of consumers. This will include customers who have long been purchasing from Michael Hill and are as loyal as to to follow us into a new market segment.
Increase quality and extend line of Michael Hill branded products (perfume, watches, jewellery).
Michael Hill product line will appeal to medium income earners.
Research new and current target audiences (focus groups and secondary data).
Marketing Strategy
mid term
Assessment of New Market Entry

The new strategy for Michael Hill involves creating a prestigious brand image for the company, as well as entering new countries. Over the period of three years we will open flagship stores in Singapore, Hong Kong and Dubai.

Individual enculturation of new markets/countries.
Strong brand integrity.
Jewellery market has an increasing demand for high quality diamonds.
Open stores in prime real estate locations, closing excess stores in lower socio-economical areas. (Reduce quantity, increase quality)
Marketing Strategy
mid term
Approach to Differentiation

As we will be entering a pre-existing market segment it is important to establish an identity which will set Michael Hill apart from the competitors. Points focused on:
New Zealand heritage
Establish consistent line of modern/culturally influenced Jade and silver jewellery.
Reputation for nurturing and expanding the consumers’ relationship with jewellery.
Excellent rapport amongst staff members; team bonding experiences; extensive training on the personality of the company as well as the integrity of our products.
Augmented benefits such as; customer service and staff knowledge; exclusive member offers; lifetime warranty on high end designs; show case events for new stock.
Internal Marketing Communication Plan
Short Term
Internal Marketing Communications Plan
Mid Term
Internal Marketing Communications Plan
mid term
Assessment of New Market Entry

Undergo primary research to understand the prime geographical

Assess the level of risk involved within each location
Internal Marketing Communications Plan
mid term
Approach to Differentiation

Restructure the marketing for MHJ to include
The rich heritage
Include the exclusive product lines
Enforce strong customer loyalty

Build a unique marketing position that clearly defines MHJ new approach
Marketing Strategy
long Term
Marketing Strategy
long term
Open Mini Michael Hill
(for children)

In the later process of grounding the increased quality of MHJ there will be a new line of stores for children:
Leveraging to a younger market
Fortifying our reputation as nurturing the jewellery experience
Open to a wider target audience and build on the life time value of consumers
Stores will be consistent with Michael Hill theme (logo & colours) with a twist of youthfulness incorporated into interior decor.
Marketing Strategy
long term
Brand Consistency and Evolution

Maintaining our image and reputation will require an equal balance of consistency and the ability to evolve with modern trends. In order to do this we will need to:

Adapt to the global market accordingly. For example; there may be a higher demand for gold in India in comparison to New Zealand or Australia, which must be met.
Continue consistency in Michael Hill traditionally inspired product line of jewellery;
Offer high end brand lines with the option of classic designs as well as products that are in flow with the latest trends.
Promotional materials will remain true to the brand integrity.
Marketing Strategy
long term
Pricing Strategy & Return on Investment

In our strategy to re-brand Michael Hill as a high end brand, we will have new brands of a higher quality, which will increase the purchasing price. The additional profit margin is set in association with each individual brand.
To prevent loss of customers; an extensive marketing campaign providing consumers with information about the increase of quality.
The increase in price and value will make up for decreases in purchases.
Create higher elasticity due to increase in quality of product & brands.
Generate a logistics plan which capitalizes on the most efficient transportation and storage facilities.
Internal Marketing Communications Plan
long Term
Internal Marketing Communications Plan
long term
Mini Michael Hill

To execute this long term objective we will have to undergo the following strategic moves:
Display emotional advertisements within women’s magazines e.g. Women’s Weekly, Vogue
Decorate the Interior of these new stores to create a sensory experience to invite the customers to have an emotional attachment to this brand extension
Continue the premium products found within MHJ but tailor for a more youthful market
Use primary research to capture regular customers and introduce them to this brand extension by personal selling
Internal Marketing Communications Plan
long term
Brand Consistency and Evolution

To achieve a well integrated brand consistency and evolution MHJ will have to maintain:

Strong primary and secondary research to understand the fluctuating market and tailor the product supply accordingly

Maintain a strong alliance with suppliers to ensure product quality remains unquestionable

Continue ways to reduce the base prices (transport, storage, etc.) to increase ROI
Internal Marketing Communications Plan
long term
Pricing Strategy & Return on Investment

MHJ will hope to become industry leaders, because of they will have low per-unit costs and little need to make any further investments, enjoy high profits and postive cash flows. These cash flows can then be harvested and diverted to other strategic business units (SBUs) or products in the business portfolio that promise greater future growth. (TEXTBOOK). To conduct this MHJ will need to:
Increase vigilance, to understand new business entrants and react accordingly
Allow the customer to feel a high quality return while also selling for a high ROI
Internal Marketing Communications Plan
Tools
Advertising
Billboards
Youtube Channel
Television Commercial

Public Relations

Personal Selling (in-store)

Social Media

Internal Marketing Communications Plan
Internal Marketing Communications Plan
Marketing Metrics
Marketing Metrics
Full transcript