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BATA Pakistan Limited: Background and Analysis

As 'Leather tanning / processing' (from raw to finish level) is my family business and my dad has been dealing in this business since last two decades, that's why I've decided on 'BATA Pakistan' for my report/assignment of tactical planning. We sell done / tanned leather for boot uppers to 'BATA Pakistan Small' a respected footwear making & advertising company in the country. I've been in touch with BATA Pakistan for four years when i worked with my dad in my own afore-mentioned family business and I feel interested in talking about the marketing strategy of BATA Pakistan Limited

In this survey, I'll focus on:

history/background of BATA Pakistan

information about the business's main brands

an summary of the marketing strategy of BATA Pakistan

impact factors that impact the business

needs and anticipations of the stakeholders

appropriate tools to investigate the consequences the business

resources needed to implement the strategic plan

measures to judge the business enterprise strategy

general critique and an evaluation of BATA Pakistan's marketing

strategy from my point of view

some tips for the future

A brief Record/Background

Bata Pakistan Limited is Pakistan-based company involved in the developing and deal of footwear. It is one of the oldest boots companies of Pakistan. Focusing on leather shoes and accessories, the business has made its special connection with high quality university shoes and can be properly declared as market innovator in this category. Bata offers its presence with an increase of than 373 shops and 12 wholesale depots depots in Pakistan. The business provides full assortment of shoes ranging from newborn to adults in every categories.

MAIN BRANDS

BATA Pakistan Small manufactures and sells shoes for men, women and children. Its major brands include:

Category: Men

Brand name: Cost range Designs

Power Rs. 699 - Rs. 1699 08

Bata Comfirt Rs. 449 - Rs. 1199 10

Weinbrenner Rs. 499 - Rs. 899 03

Category: Ladies

Power Rs. 899 - Rs. 899 04

Bata Comfit Rs. 249 - Rs. 899 14

Marie Claire Rs. 899 - Rs. 1299 10

Category: Children

Bubblegummers Rs. 249 - Rs. 599 09

(www. bata. pk/catalogue)

FOCUS ON BRAND DEVELOPMENT

BATA has concentrated and capitalized on its brands. Brand development has played an important role in Bata's success. To offer customers the best in terms of fashion, quality, comfort and price, BATA's brands are fairly worthy-mentioning. Amongst them;

'Bubblegummers' is children's leading shoes or boots that has developed

extensively in Pakistan. It bears an array of accessories

including school bags, casual hand bags, stationery and other items.

Comfort is an important feature in design and assembling of all the 'Bata Comfit' shoes. "Get comfortable Today" is a tagline commonly

associated with these shoes.

'Marie Claire' shoes are for ladies with an active lifestyle, who seek

contemporary modern designs. This brand is very successful in

Pakistan.

'Power' embodies variety with amounts in running, hockey,

football and outdoor, that combines function with imagination.

'The Weinbrenner' line is made up of leather shoes and boots; low,

mid and high cut. Reductions or designs are dictated by fashion.

Focussing on its brand development has resulted Bata in the next success:

Key Stats & Ratios

(Jan-Jun 2010) (July-Dec2010)

Net PROFIT PERCENTAGE 3. 67% 4. 66%

Operating Margin 6. 45% 6. 86%

Return on Average

Assets 7. 89% 9. 28%

Return on Average

Equity 16. 66% 19. 24%

Employees 2912

(Commercial Credit Report for BATA Pakistan, Ltd. 2010)

BATA Pakistan has categorized an aggressive ad to be its first priority. It's been prominent in rationally and medically promoting public awareness for the right selection and utilization of good quality shoes that has helped changing public considering shoes selection and use, and also increasing sales for Bata. Following are some of the scientific facts highlighted by BATA:

Unstrained Walking: You walk normally about 10, 000 steps each day. So throughout your lifetime you should have most probably walked enough steps to have journeyed around the earth more than 4 times. For such a long ride, your toes deserve a comfortable vessel.

Shock Absorption: With each step, all your weight is absorbed by tissue throughout the feet. The heel specifically absorbs almost all of your own body's weight. Did you know you take about 4-6 times of your body weight across the ankle joint when climbing stairs because of the mechanics required to your body? That points out why a gentle landing is treasured for your legs.

Safe Trip for your Ft: Perhaps you have experienced riding motorbike in shoes? You probably thought the burnt from the exhaust heating, slipped from the brake pedal, and acquired scratches with the gear shaft. Those are many annoyances making your ride uncomfortable and possibly dangerous. You will let your feet breathe and be safe at exactly the same time when you ride your bike with BATA shoes.

Fresh Toes: You will find more sweat glands per inches in your feet than

any where else within you, roughly 2, 50, 000. And they

secrete all the time, approximately 20 cl of moisture everyday and not just

in respond to heating or exercise, which means that your ft do need to continue

breathing whilst locked up in your shoes.

Snapshot of Bata Pakistan's Marketing Strategy

Bata's marketing strategy focuses on:

-analysing the various needs of different groups of customers

-making the the majority of the company's talents and match them to the needs of the mark customers

-offering customers the best in sneakers in terms of fashion, quality and price

-concentrating a market area of interest where BATA could possibly be the best

-acknowledging the existing and prospects, grouping and segmenting them characterized them by their needs and tastes in terms of shoes selection and usage

-put the marketing strategy into impact with a marketing plan that sets out actions, schedules, costs, resources and effective offering programmes

-measuring the effectiveness of what's being done, be prepared to change things that aren't working

-considering the mixture of controllable marketing variables that the company use to pursue the sought degree of sales in the prospective market

-implementing and handling the marketing efforts by collecting responses and getting back again to planning

-using forms of advertising that work the best i. e. exhibitions, creating effective items of sales, public relations initiatives, magazines and Television ads

-consolidate the existing top quality business activities into a respected professional and professional shoes or boots company

-promoting consciousness about the value of right selection and usage of sneakers from health-consciousness and methodical researches angles

-supporting education and motivating entrepreneurship to fight poverty and exclusion via auto-subsistence with Bata's principles regarding communities concerning:

a) Respecting the integrity of local culture

b) Considering areas as partners in progress and regarding employees in a two-way communication with them

c) Allocating resources to improve the well-being of the neighborhoods in which BATA operates

d) Collaborating with people in the communities who focus on raising criteria of education and economic well-being.

(www. bata. pk/marketing)

MARKETING RESEARCH SYSTEM

Bata's marketing system runs in a organized way. It adopts the marketing research system that is dependant on regular research. BATA Pakistan Small arranges for advert (pre and post), observation in store, mystery shopping, consumption and attitude surveys, focus groups because of its marketing research programme. Before launching a fresh product on the market, it is a part of Bata's marketing strategy to perform interviews with the targeted customers and have them about their loves, dislikes and tastes about the Bata brands/ products. Bata conducts marketing research and relevant interviews, distributes discount vouchers and offers other attractive incentives to its expected customers because of their active involvement in Bata's marketing research-oriented programmes. The primary reason behind the success of Bata Pakistan Small is direct research process and immediately contacting the mark customers. It seems mentionable that in respect with the marketing research for new brands, pre-launch marketing research has enjoyed an extremely helpful role for paving just how of Bata's marketing strategy. Bata's marketing research system helps to keep Bata touching the needs of Bata's customers and helps Bata in making its marketing decision.

SEGMENTATION

Segmentation is splitting customers into different segments; similar groups of customers, within which customers with the similar characteristics have the similar needs. Market segmentation is important and useful as market is the set of all real and audience of a product and buyers are not homogeneous. Marketing segmentation is essential for well- understanding of the market and it takes on a key role for an effective business as it can help you know the mark market better than your competition. Bata's market segmentation is made up of geographic, demographic, psychographic and behavioral top features of its market segments having taken into account of the region (rural/urban/city/town/village), era, gender, social category, job, income, personality traits and lifestyles). For instance, from age viewpoint, Bata segments the age teams into children, young and old age people. From marketing perspective, all the three categories are rationally centered by Bata with the main concern to supply the customers the best footwear, similar both in quality and price, based on the needs of each section. Bata has turn out amazingly successful in children portion that has helped Bata make high sales demonstrating the segment worthwhile.

TARGETING

Targeting can be an important part of marketing strategy. The key

step in focus on marketing is 'dividing a market into distinct and meaningful sets of customers'. (Kotler and Karen F. A Fox 1985). After segmentation it's time to target the main and important segmented teams. In Bata's online marketing strategy, target communities are children, females and people of different time levels. For an sufficient targeting, Bata has offered Bubblegummers along with an array of accessories including university and casual luggage, stationery, etc for children that has demonstrated a huge success, Marie Claire for women offering them a nice blend of effective lifestyle and contemporary modern designs, 'Power' for young age and sport-spirit people, Weinbrenner for office and ceremonial use, and 'Bata Comfit' featuring comfort and modernly designs, suits kids and young to later years people segment for his or her free, leisure time shoes utilization.

POSITIONING

Positioning is customers' understanding of something with regards to alternatives on the market. For its as an important part of marketing strategy, positioning has been given credited attention in Bata's online marketing strategy. Customers' attitudes towards Bata's boot brands and accessories is regularly witnessed and measured. It can help Bata identify the scope for new brands and also reposition the existing brands. An edge that Bata Pakistan offers on other footwear manufacturing and offering companies in the market is that Bata has a big number of retail outlets throughout the country; it is footwear giant in the country, so it has a much bigger space for impressive and attractive positioning. Reinforced with good customer support and direct customers contact, Bata has turn out with successful positioning.

PRODUCT

Product is the 'offer' that is exchanged between your supplier/seller and the buyer and involves goods (tangible) and services, ideas (intangible). In Bata Pakistan Ltd's case, products (shoes and accessories) are tangible. At Bata, products are featured in accordance with the need/benefits of the customers and customer-satisfaction is given due goal. As product is the key/basic thing to be wanted to the customer against his/her money, so Bata shoes and accessories, both in terms of product-quality and equivalent price in the competitive market, are considered essential for the success of the business. Bata's brand and product packaging are of good standard and two months' period free of charge after sales service is also offered to the Bata customers. In order to satisfy the target market, Bata handles the existing and new product attempts in a systematic way. That is why, Bata has earned trust of its customers.

PRICE

Price is the worthiness a buyer exchanges for the great things about something or service. Additionally it is one of the key factors in the online marketing strategy as it works for the survival, profit, profits on return, market, show and position quo of the manufacturer / vendor. Customers can assess the quality of the merchandise from the purchase price being charged that makes the prices very important in the online marketing strategy of an company. As paying high price, customers want the product quality to be good while against good deal, they (customers) normally presume something to be of poor. Bata has tried out to do its products' costing quite sensibly as Bata shoes and accessories are of good quality while their prices are highly equivalent that gives Bata a competitive advantage over its competition. Affordability and competitiveness are basis of Bata's charges policy. Bata's charges strategy does not simply try to match your competition, but it focuses on beating its competitors both in good quality and acceptable prices that helps to keep its position strengthened on the market.

PLACE

It is about how exactly and in which a manufacturer/seller provides its products and it can include using different syndication channels. It's very beneficial if a company's business place is ideally accessible for the customers and the distribution route is also possible less costing. Bata Pakistan Limited retains more than 373 retail outlets and 12 general depots throughout the country. To cater the middle upper income section of the marketplace, 13 city principle stores have been opened in 2006-07 in the major places ; Karachi, Lahore, Peshawar, Rawalpindi, Mirpur, Gujranwala and Gujrat. Definitely, place counts much more importance for Bata with such a broad business network. Bata has a good route structure and route management offering it an easy, in-time and cost-effective usage of the marketplace. Bata has its own manufacturing models and low cost depots at easily accessible locations from where it can make well-timed items to its retail outlets. With a good retailer image, Bata is ready where it can make its position even much better.

PROMOTION

Promotion concerns with the way you reach your customers / prospects. It's the communication associated with an organization's marketing blend to the required audience and works as a backbone of an company's online marketing strategy. Bata Pakistan' online marketing strategy provides very sizeable importance to the campaign. It applies all quite tools of advertising including advertising, sales management, sales promotion, promotional mix, immediate marketing and pr for expanding the business's business. Though the fair-price selling is the base of Bata's marketing strategy, yet different attractive campaigns and promotional mixes are also wanted to the clients. Accessories including socks, footwear laces, shoe polishes and institution bags for the children can be found free with different brands of shoes as promotional mixes.

SWOT Evaluation of Bata Pakistan Ltd.

Strengths: Bata has strengthened its business in 2007 on the base of improved online marketing strategy that is a signal of success. The return on average assets and the go back on average collateral have improved slowly and gradually. Bata's success running a business and better budget have resulted in improved health and safety, and many key performance improvements. Good brand, low cost employees, high efficiency on standard products, best in children shoes, good logistics, good local labour pool, good manufacturing units, wide network of shops are all strengths of Bata Pakistan.

Weaknesses: Poor inter-company relations and less attractive incomes and incentive bonus items for the employees have been a halt in the possibly faster progress of the company that results in improperly motivated personnel as a weakness of the business.

Opportunities: The industry is experiencing the issues of design invention, less creation and inward/local demand-orientation of the marketplace. Bata, by properly utilizing its resources of modernly equipped manufacturing units and capacities of trained personnel, may take enough benefit of this loop gap. Poor delivery performance in the sector, well-paid and stimulated staff positioning, improvement in inter company links and new purchasers, are good opportunities for Bata.

Threats: The chance of sacrificing skilled personnel to the competition due to lack of attractive wages and incentive bonus products as cost of living rising rapidly. While the competitors might prefer to hire skilled and well-trained staff of Bata at higher salary deals. Imports of cheap price shoes and accessories especially from Chine, skilled staff motion to the opponents, relatively shrinking sector for leather shoes, increasing cost of recycleables and unreliable alternative raw materials suppliers, are all hazards for Bata.

Learning from the mistakes

Bata Pakistan has experienced few mentionable faults in its online marketing strategy in the past. One of those was when BATA made a decision to adopt the high-end sections of the Pakistani sneaker market as part of its marketplace. It launched a number of brands for this segment with higher prices. The move landed BATA in big trouble. This segment was not meant for BATA. In the first place, this segment was not sizable for a business like BATA. Second, the segment did not get with Bata's distinctive competence. The section constituted a mere 5 to 10 per cent of the shoes or boots market in Pakistan. It might not supply the quantities that BATA was used to at the mass end and high level was needed for BATA for having healthy important thing. Worse still, the adoption of the segment misdirected Bata's complete strategy. The very best end of the marketplace suddenly became the main focus of the business and it forgot its bread-and-butter shoes that experienced given the business its personal information. And, small regional competitors started nibbling away at Bata's mainstay. Actually, Bata was squeezed at both ends. At the low ends, smaller rivals attached Bata's mass range in colleges shoes and chappals, which the company had almost vacated alone by disregarding them completely. In the high end, niche market competitors, who had been better prepared, were challenging Bata. From the market share of around 15 % in the middle 1999s, Bata found its share slide right down to 10 per cent of the sneakers market in middle 2000s. The year 2001 saw the business running a loss of Rs. 42 million.

After learning the lessons the hard way, BATA have an about-turn from its experience with high-end-segment and went back to the mass portion. The brand new strategy was to make contact with the original customers at the low end and keep that area of the market as its center focus. The business, of course, didn't totally quit the new segment it had experienced in the first 1999s. Brands like Hush Young puppies, for example, continued to be sold by Bata, however in a selective way and through select stores only. (Anil Chawla, June 2003, 'Marketing Management').

Having faced a detrimental situation, BATA successfully reinvented itself as a renowned shop offering customers the best in footwear in terms of fashion, quality and launched the concept of flagship stores to give a complete and unique shopping experience predicated on modern trends, tranquil ambience, great products and courteous staff at the new-look flagship stores which are all part of Bata's new marketing strategy paving the way of success for BATA, which is a prominently useful exemplory case of BATA' online marketing strategy of monitoring and evaluating the online marketing strategy in practice and then taking essential steps and changes appropriately as measuring the effectiveness of what has been done, and be prepared to change things that are not working.

BATA has effectively done consolidating the prevailing top quality business activities into a leading and professional company that has helped in significant reduction of the business's trade-debt burden. The business is strictly handling on credit and lowering the spectacular receivables and it is able to augment its financial position to a larger extent. BATA Pakistan has strengthened its position on the stock market as evident from increasing P/E percentage and market per share. Backed by increase in demand, EPS has shown an upward tendency as well until just lately when it dropped due to instability in the country, which depressed the turnout to the retail stores of the business. The net value of the business is not very high. The business proposed a higher dividend in Nov. 2007 because of the better results. It raised the ultimate dividends by 20% thus increasing the buyers' assurance.

(Business Leader, Pakistan, March 2008, "BATA Pakistan Ltd: Traders' perspective and Future Outlook").

Future Outlook

Increase in the price of production primarily due to hike in prices of raw materials, interest rates and travelling costs might pose difficult to the business. The increased costs might depress sales for the business along with influencing the top-line and bottom-line. Furthermore, Bata Pakistan should progressively more divert its concentration towards development, new designs and maintenance of its retail outlets to keep its customers platform intact. The cut-throat competition from the brought in cheap price shoes and many new and existing local stores can significantly influence the business business. In order to maintain its success as a household name for the folks of Pakistan, creativity and research for top quality should rest at the central of Bata product development insurance policy. Bata needs to consistently focus on the development of shoes with unique comfort, technology features and designs available to the people through the string of modern large format and sport principle outlets bringing in new trends to match the needs of both the traditional and the trendy. Feed again from customers and employees, goof wages packages coupled with bonus packs for the employees, using customer data, waiting for you speciality/assistance counters, items with purchase, incentives for the merchants, promotional items like tops with 'BATA' imprinted with them, sponsorship of sports activities especially cricket as it's the most popular game with the Pakistani people, issuance of devotion credit cards and delivery services can be of great help for Bata, especially in its marketing.

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