METRO SHOES

FINAL REPORT
1/9/2013

Submitted by: Fatima Ahmed Mareeha Farooq Mohammad Ahmed Ghafoor Sarosh Tasneem Raja Shahzeb Farrukh Sumbul Afzal Rao

Contents
INTRODUCTON .......................................................................................................................................... 2 CURRENT MARKET SITUATION ............................................................................................................ 2 Market trends: ........................................................................................................................................... 2 Existing brands.......................................................................................................................................... 3 Marketing strategy for brands ................................................................................................................... 3 DETAILED SEGMENTATION................................................................................................................... 5 Segmentation............................................................................................................................................. 5 Targeting ................................................................................................................................................... 5 Positioning ................................................................................................................................................ 5 MARKET ANALYSIS ................................................................................................................................. 5 Porters Five Forces ................................................................................................................................... 6 SWOT ....................................................................................................................................................... 8 PROMOTIONAL MIX ................................................................................................................................. 9 Objective ................................................................................................................................................... 9 Promotional Mix Tools ............................................................................................................................. 9 MARKETING COMMUNICATION STRATEGY ................................................................................... 10 TACTICS AND ACTION PROGRAM ..................................................................................................... 10 Advertising.............................................................................................................................................. 10 Sales Promotion ...................................................................................................................................... 12 Social Media Marketing .......................................................................................................................... 13 EVALUATION PROCESS AND MARKETING BUDGET..................................................................... 14 Efficiency ................................................................................................................................................ 14 Effectiveness ........................................................................................................................................... 14 Marketing Budget ................................................................................................................................. 145

INTRODUCTON
Metro Shoes is one of the most successful shoes brands of Pakistan and has a history of delivering high quality shoes. The first store was opened in 1986 with the mission to meet the footwear needs of the market. From that time onwards there was no looking backwards. It originated from Faisalabad and is now spread over country having branches in Islamabad, Rawalpindi, Lahore Gujranwala Sialkot, and Rahim Yar Khan Etc. Within a few years times, it is ranked amongst the most worn and liked shoes in the country. Metro Shoes offers very stylish and trendy shoes with classic fit and modern shape. It offers a variety of products for men and women including shoes, bags and clutches. New collection is introduced every summer and winter with new shoes coming in for special occasions like Eid and wedding season. Metro Shoes has an official website also where customers can shop online.

CURRENT MARKET SITUATION

The Pakistani footwear industry is quite up to date and is evolving continuously with the passage of time. Market trends and consumers preferences are changing very swiftly and this is also shaping up the sort of offerings in the market for the consumer. The presence of leading international brands, strong power of media, frequent internet surfing and wide variety of options for the consumer has shaped up the competitive environment. This also forced the general quality of the product offerings to increase in the footwear industry. The consumer is more aware and conscious than was even before. Our target market of affluent, chic, social, and trendy and fashionably up to date ladies are even more so a tricky and demanding consumer. They know their trends and certain qualities and features attract them. To target them and convert their aspirations into a purchase behavior can be a tricky task.

Market trends:
In the previous decade, a lot of new market players have entered the footwear industry and brought new trends and styles for good. As the competitive environment shaped up and more options were available in the market, companies got serious. It led to a major shift in trends in the footwear industry. Both quality and styles improved. Prices were competitive and a customer
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centric focus was envisioned and also later reflected in the products. Not just local players, but international styles and inclinations were also studied and embraced in the local market. Currently, wedges and extra bling are the most desirable styles in both sandals and shoes. Jute shoes were seen ruling the racks in the summers but now that winter is here leather and suede shoes are on everyones wish list. Trendy shoes with buckles, studs, bows and fur are selling like hot cakes. For long boots, block heels are incorporated to give it a more trendy and formal look. Uggs, pumps, long boots, combat boots, peep toes, moccasins and wellington boots are appropriate to beat the cold and keep your toes warm whilst still being trendy, stylish and making a fashion statement. A broad spectrum of colors and tones are available in the market. Neutral and earthy tones that go with the subtle and calm mood of winter while the bright and funky colors that break the monotony and stand out on a beautiful sunny day.

Existing brands
Various brands of local and international repute are present in the market providing the consumer with various options and a diverse selection. Considering our target market which is the high end and upper strata of the society, only a few brands have an impact. We have divided these brands into four categories Local (Stylo, ECS, Walkin, Stiletto) Foreign (Charles and Keith, Marie Claire, Lark and Finch) Exported shoes (Dwatson, Haroons, Illusions) Retail outlets (Stoneage, Outfitters, Crossroads, Breakout) Online and sell-at-home players (Stylista, Daraz.pk)

Marketing strategy for brands

Not all of the categories follow a marketing strategy but those who do; they adapt differentiation one way or the other. The difference is how they go about their strategy and the factors, features and benefits that are being highlighted while differentiating from the competition.
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The local players try to get an edge by providing comparatively low priced footwear (though still the prices reflect that they are high end shoes). Amongst all these categories they advertise and market their brand the most. Their advertisements are seen on maximum mediums as they use print ads, billboards, internet marketing, TVCs. The retail outlets differentiate themselves on the basis of a style statement and fashion forward image that they have in the market. They also use in store marketing, billboards and prints ads to market their footwear. But the focus is not just on the footwear, the advertisement focuses on a whole look including clothes, footwear, accessories etc. Exported shoes are available at trendy stores like Haroons and Illusions but they do not go for marketing the shoe segment of their business. Though the shoes are imported and of good quality and style, one would never see them marketing about it. Dwatson has ranges in shoes that may be no store in the twin cities does but due to lack of marketing, people dont even know that they also sell footwear. The foreign brands do not need to do much as they can easily differentiate on their brand names and the reputation that their brand enjoys being a foreign brand. Such stores just go for extensive and intense marketing in the launch period to create awareness and to make their mark in the market. After that the consumer is drawn towards their store themselves. like Kenneth Cole, Nine West, Timberland, Puma, Gucci, Charles and Keith, Mango, Lacrosse, Vans, San Paulo & Alpargatas etc. They usually market only over the social media and interact direct with the customer. Online and local players who export shoes or get them from abroad themselves employ no marketing technique and market themselves on the basis of the brand names that they are selling. They usually have footwear of brands like Kenneth Cole, Nine West, Timberland, Puma, Gucci, Charles and Keith, Mango, Lacrosse, Vans, San Paulo & Alpargatas etc. They usually market only over the social media and interact direct with the customer.

DETAILED SEGMENTATION
Segmentation
We are focusing on the segment of market that feels individuality and expression as essential parts of self-definition. Hence Metro Shoes offers footwear that promotes individuality and uniqueness while at the same time gives a fashionable and trendy look. The segment Metro Shoes will primarily focus on will be customers who walk along the fashion

Targeting
Keeping in mind the proposed segmentation of Metro Shoes, the target market is the upper middle class. Upper Middle class has the money as well as the desire to buy sophisticated yet trendy and colorful accessories to complement their daily wear. Metro would help this segment to define their individual personality by offering them trendy shoes and accessories.

Positioning
Based on the segmentation and targeting of Metro shoes, we would position Metro Shoes and its products such that it gives an aura of high end wear and also give a premium look. One reason why Metro Shoes died down is because it became too common and nobody wanted it anymore. To cater to such issue, we will target upper middle class who takes fashion seriously and introduce product lines rapidly. The positioning statement of Metro Shoes We will cater to the ever changing fashion and trends by offering premium products that are unique and fashionable. We are the trend-setters not followers.

MARKET ANALYSIS
Major products sold by shoe stores include womens casual and dress shoes (35 percent of industry revenue); mens athletic shoes (20 percent); mens casual and dress shoes (13 percent), and womens athletic shoes (5 percent). Other products include handbags, hosiery, and jewelry. Companies may specialize in mens, womens, childrens, or athletic shoes. Over half of all shoe

retailers are family shoe stores, which offer merchandise for multiple targets. 1 (Pakistan Shoe Industry, 2011)

Porters Five Forces

To better understand the shoe industry in Pakistan, this particular sector is being assessed with the help of Porters Five Forces Model: 1) Existing Rivalry The Shoe industry in Pakistan is at a mature stage and therefore the competition among the players to snatch away market shares is VERY HIGH. Margins are thin, there are no chances of further growth and every company wants to dominate the market. Therefore, they compete on prices rather than differentiation and follow competitive pricing strategy. This could impact metro to an extent because even though it launches its new variety from time to time, the only time when it would be able to make profits would be the sales season via sales promotions.

2) Threat of New Entrants The threat of new players entering the competitive landscape is LOW. Because the there are no growth opportunities in the mature show industry and the existing rivalry is already fierce. No further innovation can be expected since companies all round the world have already brought their footwear in the Pakistani market hence margins for growth through differentiation strategy offers no grounds. Moreover, the potential of existing big players to compete the cut throat rivalry on prices and the economies of scales that they have achieved over time raise barriers to the entry of new players.

3) Threat of Substitutes The shoe industry is fortunate for not having any indirect substitutes like many other industries. But it faces quite a threat from the direct substitutes available from global, international and local brands available in the market today. Hence the threat of substitutes in the shoe industry is HIGH. A customer can easily deviate and switch to new footwear just as quick, depending on the price, its uniqueness, its quality or with
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http://www.hoovers.com/industry-facts.shoe-stores.1520

changing fashion preferences. Moreover, with so many resources available it is very easy to replicate a firms own product or bring the latest hip fashions replica.

4) Buying Power of Buyers With a fierce competition among numerous players in the market, that offer competitive prices, it has become very easy for the consumers to pick from the large variety of substitute brands available. Therefore, buyers tend to exercise a HIGH bargaining power.

5) Buying Power of Suppliers The bargaining power of suppliers in footwear industry is LOW. Shoes are manufactured primarily from raw materials including rubber, leather, cotton and nylon. These materials could be classified as commodities, where the manufacturing process actually adds to their value. Therefore firm with greater brand equity and a strong image have absolute advantage and power over their suppliers. Most importantly, firms are able to switch between suppliers quickly and cost effectively, therefore these suppliers become dependent on these firms for survival. For this reason, the suppliers have limited

bargaining power, and little impact on profit potential.

SWOT
STRENGTHS A well-known and well established brand High quality stylish footwear with a wide variety Appeals people of all ages primarily the major population chunk i.e. Youth Strong focus on latest trends and consumer preferences Valuable partnerships with D&G, WEAKNESSES Does not have international presence. Does not manufacture mens wear. Limited advertisement campaigns are insufficient. Inexpensive price tags signal low quality and lesser durability

Adidas and Nike as a retailer.

OPPORTUNITIES Sponsor Fashion shows and endorse the brand through fashion icons to increase brand equity Exclusive distribution would help

THREATS With the national economic situation, people tend to switch to low end brand or cost effective products. Many local vendors have been able to replicate branded shoes Company needs to be highly responsive with day to day changing fashion trends Mature industry would always force to keep the prices low irrespective of the finest quality produced.

position Metro as a high end brand Expand into international markets with the help of partnerships with brands focusing similar values audience. Expand into trendy accessories e.g. handbags Increase awareness about Metro being an impression of Individuality and selfexpression Raise awareness about the importance of good quality shoes for healthy feet and target

PROMOTIONAL MIX
Objective
The main objective of our promotional campaign is to: Present information about the product: Even though Metro Shoes is a well-known brand in our target market but we still think it is important to promote our brand and give information about new collection, special offers, discounts, sales etc. Increase demand: Different promotional strategies will be used at different stages in order to increase sales. Differentiate our product: It is important as multiple competitors are present targeting the same customer as ours.

Promotional Mix Tools

To achieve our objectives we have chosen advertising, sales promotion and social media from the seven elements of promotional mix for advertising and promotional campaign of Metro Shoes. Advertising: Overall costs are high but it is an excellent way to reach large and geographically dispersed audiences and also it has low cost per exposure. Not only it stimulates short term sales but it also helps in building brand image. The medium used for advertising is mass media that is radio and television network, print media including newspapers, fashion magazines and billboards. Sales Promotions: Well be using it to stimulate quick response. Seasonal sales, discounts and product bundling would be used. Customer loyalty cards would also be introduced offering special discounts and giving gifts on special occasions like Eid, birthday of the card holder etc. Internet: Along with Company website social media like Facebook and twitter will be used. It is comparatively cheaper than other promotional medium yet very effective.

MARKETING COMMUNICATION STRATEGY

The communication strategy illustrates the reason as to why Metro Shoes is to be valued superior against its competitors. Metro Shoes depicts the image of being trend-setters, thus laying light on being first at fashion. The marketing mediums mentioned before will be used to integrate the concept wholly. There are two key words: trendy and premium. We need to define a clear positioning image through the advertisement and marketing mediums to depict that with every change in the fashion statement is brought about rapidly. The greater quality and product type allows for a premium charge. Metro Shoes hence sells experience, not mere products. In order to allow for a clear and specific communication process to occur, its crucial to take into account customer testimonials. When the customer is giving input and feedback (through interactive mediums like social media), it needs to be utilized and acted upon. Metro Shoes can create customer goodwill by developing an informational sheet on a customer-focused topic. For the strategy to be definitive its important that the image is delivered across through more than one promotional medium, hence advertisements, sales promotion and social media. Its crucial to depict the image of being a premium trend setter, thoroughly, through every medium. The message should be sent with coherence, so that no ambiguity is left in the minds of the target market with regards to the positioning.

TACTICS AND ACTION PROGRAM

Advertising
While going ahead with TV commercials, it would be important to ensure that the basic concepts are clear. While our reach is not that much, as Metro Shoes is situated in specific cities, the purpose of having a TVC is to generate its brand name. TVCs allow for a widely recognized name, and will help in branding Metro Shoes. The TVCs are primarily going to be aired on Geo, during the late prime time. In order to cater to the cost-effectiveness, prime time will not be possible. However, the target audience can be reached during late primetime. The TVC will be a 60 seconds ad, which will be played with a
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frequency peaking during the prime months (i.e. March, April and May and then in, Sept, Oct & November).These months offer new product lines of the season, as well, engaging a greater audience. Our TVC will ensure that; A Direct and clear pitch is set forth. We need to bank on the concept for the

advertisement. And present it as manifestly as possible. That would ensure a clear image in the minds of the customers, no ifs, no buts. The primary purpose of Metro shoes is to preset shoes that quench the need of fashionable, trendy shoes. That is precisely what it will show. Its important to push the USP, as much as possible. Metro Shoes positions itself for being trendy and chic. While its true that the product (shoes, bags, accessories) hold great relevance, while delivering a TVC its crucial to not only portray the product, but the experience. Metro Shoes TVC will create the need for customers to buy from them, through the feel they provide. Its also important to dramatize the whole effect of the shoes. We need to establish a high perceived value from the TVC . Cost will not be entertained during the TVC as they are generally higher, however the elegant looks would be. While dramatizing the benefits, its also important to be realistic. We have to ensure that no vague, unrealistic claims are made. The primary purpose of the radio ad is to be out there. This concept works as a reminder through the minds of the customers. Even though Metro shoes is a high end brand, it will be beneficial to provide it as a bombardment reminder of its existence. It will be highly beneficial to play the radio ad during prime times, thus ensuring that the maximum traffic gets to hear it. The radio ads will use pulsing frequency playing on a higher frequency during the peak seasons, and will decrease otherwise.

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The radio ad will not be played on National radio stations, in fact on local FMs in the cities that have outlets of Metro Shoes. Once again, the radio will be in complete coherence with the overall brand positioning, by being completely integrated. The radio ad will have the dialogue statements that are extremely interlinked, as it will help provide brand recall for Metro. One of the major advertisement medium that will be used by Metro is Print Media. Metro will target leading magazines like She Mag, The Weekly, Akhbar-e-Jahan etc. The concept of the print ad is revealing in nature, a 2-D yet with a draping cover. The greatest attraction of customers is to be ensured through print media, thus the ad will depict complete image of attaining trend . In order to get customer attraction, out on the road, we will place an A1 sized billboard at an evident location in F7 Markaz, Jinnah Super, Islamabad. They will be situated there in the months of March and September, which are primarily their seasonal product line changing periods.

Sales Promotion
Its crucial to decide whether the sales promotion is short lived or long. We propose that the sales promotion should span shorter periods of time. Thus, increasing on a seasonal and occasional basis. The sales promotions tactics used will be seasonal sales, discounts and product bundling. Seasonal sales used should be such that they refer to special purchases. Its important to push hard during the seasons, like summers, winters, etc. Its also crucial to present forth the sales at a time that is conveniently before the competition could think of it. This would lead to a great number of customer attractions. The spring months of April, May and June and the fall months of September, October and November are considered peak wedding months in Pakistan hence special Wedding season sales should be held during late March and late August. The focus on these sales should be on the fancier shoes, along with their accessories.

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Also, discounts should be placed on occasional basis, with special customer cards. These loyalty cards would also provide gifts on occasions like Birthdays, anniversaries, etc. This will develop the sense of attachment towards Metro Shoes. Product bundling is a tactic that may be used all year round, particularly for off-season products.

Social Media Marketing

The primary sources of the Social Media to be used will be Facebook and Twitter. They primarily serve as low cost mediums towards advertising. The Primary tactic that will be employed is content marketing. Content marketing technique creates and distributes relevant and valuable content to attract, acquire, and engage the target audience. With the input provided at these mediums the returns are greater. They generate a large traffic from inside, ad from other websites. We will make videos viral on Youtube and Vimeo. Also, followed will be blogs written specifically to generate word-of-mouth. While going ahead with the Social Media we will focus on understanding what the customers want. The Facebook and Youtube pages will prove as an interactive medium. There will be a section that specifically takes inputs from the customers to bring about change. Customers greatly appreciate being involved in change. Its alarming to find out that while 76% of marketers believe they know what their consumers want in terms of social media content and interaction, only 34% have actually asked those buyers (e-Strategy Trends). That gap is what Metro Shoes needs to bank on. Micro-blogging on twitter is a major growing trend. Metro Shoes can allow for entertaining that. The social media pages will also include all information about upcoming offers, new trends, sales, etc. Frequency of social media will be according to pulsing frequency. It will increase during peak seasons, till three months after new seasonal product lines are introduced (i.e. March and then late August).

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EVALUATION PROCESS AND MARKETING BUDGET

One of the most crucial parts of a Marketing campaign is constantly monitoring the execution of marketing objectives and evaluating the results as per the company strategy. While, evaluating a marketing campaign it is very necessary to identify what are the strategies that are working best and can be capitalized upon; to replace those which are not working as expected. By scheduling regular evaluations of a companys marketing plan, a company can save wasted money by modifying or eliminating campaigns that are not reaching your target market or garnering the response you need. As you plan, build in mechanisms to monitor the success of each marketing effort to make evaluation cheaper and easier.

Efficiency
Cost per sale: Amount Spent for Event/Campaign / Number of sales Cost per Qualified Lead: Amount Spent for Event/Campaign / Number of Qualified Leads Cost per Visitor or Response: Amount Spent for Event/Campaign / Number of visitors or response

Effectiveness
Measuring specific marketing and advertising campaign results both Online and Offline Key Indicator: Number of Sales Highlighting your best and worst performing marketing activity Key Indicator: Reach, Customer Interest Identifying your key customer segments and the marketing tactics that attract them Monitoring Voice of the Customer and your stakeholder feedback Directly testing the perceptions and reactions of key customer segments

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Expenditure Categories Jan Advertising Tv Commercials* Billboards** Radio Ad Print Media VAT Sub Total Promotions Seasonal Sales Discounts Sub Total Social Media Marketing Website Redesign PPC Advertising Content Generation Blogging Sub Total Personnel Salaries, Wages Commissions/Bonus MISC Expenses Sub Total
Rs Rs Rs Rs Rs Rs Rs Rs Rs

Metro Shoes (Marketing Budget)

Feb
-

Mar

Apr

May

Jun
Rs Rs

Jul
Rs Rs Rs Rs

Aug
Rs Rs Rs

Sep

Oct

Nov

Dec
-

Total
4,320,000.00 1,700,000.00 145,000.00 650,000.00 1,022,250.00 7,837,250.00

Rs 720,000.00 Rs 720,000.00 Rs 720,000.00 Rs Rs 850,000.00 Rs Rs Rs Rs 25,000.00 Rs 25,000.00 Rs

720,000.00 Rs 720,000.00 Rs 720,000.00 Rs 850,000.00 Rs Rs Rs 25,000.00 Rs 25,000.00 Rs 150,000.00 Rs 50,000.00 Rs 261,750.00 Rs 119,250.00 Rs

15,000.00 Rs 15,000.00 Rs 50,000.00 Rs 10,000.00 Rs 3,750.00 Rs

10,000.00 Rs 10,000.00 Rs 200,000.00 Rs 100,000.00 Rs 1,500.00 Rs

Rs 10,000.00 Rs 1,500.00 Rs

1,500.00 Rs 269,250.00 Rs 126,750.00 Rs 117,750.00 Rs

11,500.00 Rs 11,500.00 Rs 2,064,250.00 Rs 971,750.00 Rs 902,750.00 Rs 28,750.00 Rs

Rs 11,500.00 Rs 2,006,750.00 Rs 914,250.00 Rs

Rs Rs 15,000.00 Rs - Rs 50,000.00 Rs 10,000.00 Rs 117,750.00 Rs 1,500.00 Rs 902,750.00 Rs 11,500.00 Rs

Rs Rs Rs

Rs

Rs

75,000.00 Rs 50,000.00 Rs 30,000.00 Rs 30,000.00 Rs

35,000.00 Rs

Rs

Rs

Rs

30,000.00 Rs 30,000.00 Rs

30,000.00 Rs 30,000.00 Rs 30,000.00 Rs 30,000.00 Rs 65,000.00 Rs 30,000.00 Rs 30,000.00 Rs 30,000.00 Rs

30,000.00 Rs 30,000.00 Rs 105,000.00 Rs 80,000.00 Rs

Rs 30,000.00 Rs 30,000.00 Rs 30,000.00 Rs 30,000.00 Rs 90,000.00 Rs 70,000.00 Rs 30,000.00 Rs 30,000.00 Rs

60,000.00 Rs 40,000.00 Rs Rs -

260,000.00 360,000.00 620,000.00

Rs Rs Rs Rs Rs

Rs

Rs Rs

5,000.00 Rs 25,000.00 Rs 10,000.00 Rs 5,000.00 Rs

Rs Rs

Rs

Rs

Rs

Rs Rs

25,000.00 Rs 5,000.00 Rs 5,000.00 Rs

25,000.00 Rs 5,000.00 Rs 5,000.00 Rs

Rs 30,000.00 Rs 8,000.00 Rs 5,000.00 Rs

5,000.00 Rs 5,000.00 Rs

8,000.00 Rs 5,000.00 Rs

5,000.00 Rs 5,000.00 Rs

8,000.00 Rs 5,000.00 Rs

35,000.00 Rs 10,000.00 Rs

45,000.00 Rs 13,000.00 Rs

35,000.00 Rs 10,000.00 Rs 43,000.00 Rs 13,000.00 Rs

Rs Rs 10,000.00 Rs 8,000.00 Rs 5,000.00 Rs 9,000.00 Rs 5,000.00 Rs 5,000.00 Rs 5,000.00 Rs 5,000.00 Rs 45,000.00 Rs 13,000.00 Rs 35,000.00 Rs 14,000.00 Rs
5,000.00 Rs Rs Rs 25,000.00 Rs Rs 25,000.00 Rs

10,000.00 155,000.00 86,000.00 60,000.00 311,000.00

Rs 250,000.00 Rs 250,000.00 Rs 250,000.00 Rs 250,000.00 Rs 250,000.00 Rs 250,000.00 Rs 250,000.00 Rs 250,000.00 Rs Rs Rs Rs Rs 50,000.00 Rs 50,000.00 Rs 30,000.00 Rs 30,000.00 Rs Rs Rs Rs Rs 10,000.00 Rs 10,000.00 Rs 30,000.00 Rs 30,000.00 Rs 10,000.00 Rs 10,000.00 Rs

250,000.00 Rs 250,000.00 Rs 250,000.00 Rs 250,000.00 Rs

Rs 30,000.00 Rs 30,000.00 Rs 30,000.00 Rs 10,000.00 Rs Rs

50,000.00 Rs 50,000.00 Rs Rs -

3,000,000.00 200,000.00 260,000.00 3,460,000.00

**Size: 2700 Sq. ft (Rent for 1 month in A1 area: 850,000.00) Price Rs 14,400.00

*Tv Commercials (GEO)

Monthly Spots

Grand Total
Total

Rs 12,228,250.00

50 Rs 720,000.00

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