better returns in the Indian marketCharacteristics of focus group – femalesApart from the above qualities of males, Metro having a bettertraction with women would require less new customeracquisitionWomen group would also be target for purchase for theirspousesOverall Growth StrategyShort Term objectives – 1.Make a good homepage!!!!2.Reach turnover of 100 crores (based on no of stores, we assessMetro’s current turnover to be between 60 to 70 crores)3.Double the no of styles launched every yearMedium Term Objectives – 1.Strive to attain a bottom-line margin of over 5% with a top-lineYoY growth of double the industry growth with a focused splitof growth between same stores sales and new stores sales2.Increase the no of own/franchisee stores to 100 (currently at 66)3.Reduce the brand clutter
4.Reduce no of sales/discount offers – focus on inducing purchasefor style rather than discount sales or any other factor5.Invest in R&D in designMarket Harvesting Strategy – Current ProductsNew ProductsCurrent MarketsMarket Penetration (focus on women)-New MarketsMarket Development (focus on men & women)-1.Market Penetration with focus on women2.Market Development with focus on men & women with lowbrand commitmentOverall Metro should embark on selective specialization with focus onstyle as the centre of product attribute.Rationale for the above strategy – Metro cannot compete on distribution with market leadersBata and Liberty already have alliance with Reliance andPantaloon RetailMetro has a low brand recall & commitment. New customeracquisition will be function of low brand commitment inconsumers for other brands, rather than Metro’s ability toattract and retain customersMetro has no production facility of its own. Given its existingstructure, it is most suited to fight on style & design whichchanges every season than comfort or durability which wouldrequire fixed investments in better technologies. Compared tothat launching a new style entails lower costs. By focusing inthis fashion, Metro negates the size and capital advantage thatthe dominant players have
With the larger players vertically integrated and wellentrenched with distribution networks in the market, Metro hasto focus on competing on variable costs advantages and avoidsituations which will demand fixed costs commitments. At thegeneric strategy level Metro cannot follow low cost strategywith outsourced production. It has to focus on selectivedifferentiation build around ‘style’ as its strengthDealing with Competition– Market Follower & Market ChallengerMetro should follow a mix of market follower & challenger strategy. Itshould invest in developing strengths around style prediction andstyle imitation of market leaders. Its focus should be to outsmart thebigger players on style.