revenue is dominated by the Supermarkets and Fish & Chips stores Supermarkets Clothing Shoes Fish&Chips Fuel • Clothing stores contribute very little as compared to their other brands Q1: Supermarket Strategy Super Market Strategy
• In a nutshell – Tommy is trying to reposition its massive
supermarket setup from a mid range, low priced one to a full-service and high quality one. • I would like to Evaluate their strategy based on: • Their current situation – Comp scan • Simon Sinek’s “Why, How and What” model • The top Australian Retailer is AlDI and has a total of 12,000 stores world wide and around 530 stores in Australia alone. ALDI is a no frills, cost leadership based retailer with focus on Value. • Considering ALDI’s reach and dominance in the supermarket section, it would be a good idea for Tommy’s Supermarket to differentiate their stores by adding smaller yet value oriented elements. • Introducing Private labels is also a smart strategy as it will increase their profit margins and supplier relations. • Using Simon Sinek’s “Why, How and What” Positioning evaluation strategy, I have outlined the following: • Why: Why does the organization exist? What is the company’s purpose? • How: How is the company’s offering different from others? What is unique about it? • What: What does a company or a product do? • Why – The Vision: To become Australia’s third largest retailer • How – Differentiation from the leader in terms of positioning, Fresh food section, Growing private labels • What – The company specializes in super market retail with 500 stores across Australia and aims to reach to a wider spectrum of audiences
• Points that Tommy’s Supermarkets need to take into
consideration: • They have to ensure that the do not lose connect with the current shoppers as they might start perceiving the store as high quality and consider alternatives • To ensure this, the brand must bring this change gradually and keep its communication Q2: Online Clothes line Strategy Online Clothes Strategy
• In a nutshell – Tommy’s clothes is trying to go multi
channel by opening a e-tailing venture • I would like to Evaluate their strategy based on: • Their current situation – Domain strength • Core advantages and disadvantages of e-tailing • Venturing into online retailing is a smart move but the promotional tactics used for the same needs to be changed. • Since they will now have an online customer facing brand touch point, apart from bill boards, they should also advertise on google AdWords, Facebook and Instagram using specific targeting methods based on the specific regions they want to target • As Highlighted in the diagram on the left – Using a warehouse to home strategy would suite them better as they can use the same warehousing facilities that they use for their current stores in turn reducing costs. • By going online they would be able to: • Gather Customer intelligence – this will enable them to use online marketing tools to target new customers and website analysis tools to gain insight into their customers’ needs. • They can integrate this data to enhance the potential of their offline stores and have a dual cohesive approach(Online + physical) enabling them to grow their clothes brand • Expanded reach which can increase demand • They can also expect a couple of hiccups such as: • Dealing with return and hiring new staff for the same • Additional warehousing costs • Having customer trust as they are not well established in the market as of now • Considering all the pointers above, with time and domain intelligence they can exceed the potential of their clothing line through e-tailing Q3: Smith’s Shoes strategy Smith’s Shoe Strategy
• In a nutshell – They are trying to Franchise half of their
existing shoe outlets and open 100 new ones. • I would like to Evaluate their strategy based on: • Paul O Collin’s strategy of franchising feasibility check • Advantages and disadvantages of franchising • As per Paul O Collin’s a business is feasible for a franchise model if it has: • A long term Market • a business that addresses a mass market and is not bound geographically • a business that has high gross margins • a business not affected by regulatory issues and legislation that would pose challenges for franchisees • a business which has surplus capital and access to credit • Using the franchise model, Smith's shoes can reduce risk and rapidly enhance market share. • But they have to be careful and ensure implementation of the following pointers: • Established norms and procedural practices ensuring the quality of each store • Ability to introduce changes and updates to all franchises parallelly • Strict guidelines and parameters for monitoring and evaluation • Presence of quality control staff for audits on regular intervals • These points do have additional costs linked to them but if taken care of, can help the franchisees to maintain an effective standard in turn increasing profitability and brand equity. Q4: Smith & Chips Smith & Chips Strategy
• In a nutshell – They are trying to redesign their stores to
make them more kid and customer friendly with installing advanced facilities • I would like to Evaluate their strategy based on: • Fast food restaurant differentiation strategies • Smith & Chips has decided to go for a Experience and Environment based differentiation approach. • This will enable them reinforce the brand with every interaction, not just communication. • Moreover, they will be able to target the Children birthday party market and pull a huge chunk of the market share as the arcade section is a big and highly sought after addition to restaurants • Increased traffic space and drive through will again cater to different sets of customers thus enhancing sales Q5: Loyalty Programs T+S Gas/Fuel Strategy
• In a nutshell – they are trying to enhance purchase rate
by giving incentives to the customers that shop at their stores • I would like to Evaluate their strategy based on: • Consumer behavior related to Gas stations • Advantages of implementing loyalty programs • Loyalty programs would enable the customers to: • Increase petrol stations brand loyalty and differentiate it from its direct and indirect competitors. • Drive the petrol station to customers’ “top-of- mind” and drive incremental transactions and sales among loyal customers. • Increase market share and sales per transaction. • Capture transaction data for use in future marketing efforts and • Engage high-value, profitable, loyal customers
Hence, Loyalty programs seem to be a great strategy for
Q6: Other Strategies Alternate strategy for T+S Gas Station
• T+S Gas Stations: They current strategy of loyalty
programs only takes into consideration current existing customers of the Thompson and smith customer base as it is concerned with building loyalty points through store purchases. • I Would focus on the parameters provided in the adjacent figure to: • To increase reach towards newer customers and provide a tangible quality benefit to my customers • Enhance overall quality perception of T+S gas stations • Have elongated and lasting Customer retention • They should also focus on maintaining a steady price for gas and offer additional benefits on cash payment (Store goods or freebies) 2017 Customer loyalty survey for petrol pumps • Offer discounts on bulk purchases for freight vehicles.
My focus would be to enhance long term perceived quality
and core competency of the gas stations by a holistic 360 degree approach that actually matters to the every Alternate strategy for Supermarkets • Tommy’s supermarkets: Though I agree with the supermarket differentiation strategy for a more premium positioning after evaluating Australia’s top super market brand Aldi, I would like to add more strategies to enhance market share. • Go Digital: The physical store location, as well as being a steward of the community, have been downgraded. Ecommerce works well in tandem with retail outlets, but a physical presence is no longer a requirement as companies like Amazon, Fresh Direct, and PeaPod have proven. • Focus on specialty products: Natural, organic, and specialty items have exploded in popularity and now command more shelf space. For example, the Cheese category was once limited to pre- wrapped slices. Anything more required a trip to a Wine and Cheese shop or to a specialty retailer. Now traditional grocers like Kroger (Murray’s Cheese Bar) and Wegman’s offer expansive varieties of cheeses from all • Service Integration: Retailers, focusing on their stores’ perimeter, continue to expand their services in the areas of floral, deli, prepared foods, and in-store bakeries. Some stores are fulfilling custom orders with even richer services such as butchers, kosher specialty counters, and local farmers available in their Produce department. Ansoff Strategy Matrix Analysis Ansoff strategy matrix with respect to Thompson -Smith • My understanding of the Ansoff Matrix - The four strategies of the Ansoff Matrix areas follows: • Market Penetration: It focuses on increasing sales of existing products to an existing market. • Product Development: It focuses on introducing new products to an existing market. • Market Development: It strategy focuses on entering a new market using existing products. • Diversification: It focuses on entering a new market with the introduction of new products. • Based on my understanding and the data provided it is evident that they are trying to: • Attract new customers: For instance, going online for their clothing line, and revitalization by experience focus in their Smith and Chips store • Enhance market share: Franchisee model adoption for Ansoff Matrix their shoes brand • Expand geographically: Opening supermarkets in more prominent and accessible locations Thompson-Smith is trying to expand in the regional market with existing products that are already known to the target market, hence Market Development is the strategy taken by Thompson and Conclusion Conclusion
• Based on the total evaluation of Thompson-Smith, I
understood that they are targeting new areas of your existing market. i.e., trying to sell more of the same things to different people. This is because:
• They are targeting different geographical markets at
home. • This can be facilitated by conducting a PESTEL Analysis or use the CAGE Distance Framework to identify opportunities and threats in this different market. • They are using different sales channels, such as online medium for their clothing brand. • Repositioning their supermarket brand to reach out to a more affluent demographic
These is a clear indication of strengthening one’s position in