Marketing Strategy Of Bata Pakistan

Bata Pakistan Limited is Pakistan-based company engaged in the manufacturing and sale of footwear. It is one of the oldest footwear companies of Pakistan. Specializing in leather shoes and accessories, the company has made its special association with high quality school shoes and can be safely declared as a market leader in this category. Bata boasts its presence with more than 373 retail stores and 12 wholesale depots depots in Pakistan. The company provides full assortment of shoes ranging from newborn to adults in all categories.

BATA Pakistan has categorized an aggressive advertisement to be its first priority. It has been prominent in rationally and scientifically promoting public awareness for the right selection and usage of good quality shoes that has helped modifying public thinking about shoes selection and usage, and also increasing sales for Bata. Following are a few of the scientific facts highlighted by BATA:

Shock Absorption: With each step, all of your weight is absorbed by tissues throughout the feet. The heel in particular absorbs most of your body’s weight. Did you know that you carry about four to six times of your body weight across the ankle joint when climbing stairs due to the mechanics required to your body? That explains why a soft landing is precious for your feet.

Safe Ride for your Feet: Have you experienced riding motorbike in sandals? You probably felt the burnt from the exhaust heat, slipped from the brake pedal, and got scratches with the gear shaft. Those are many annoyances making your ride uncomfortable and potentially dangerous. Now you can let your feet breathe and be safe at the same time when you ride your bike with BATA shoes.

Bata’s marketing system runs in a systematic way. It adopts the marketing research system that is based on periodic research. BATA Pakistan Limited arranges for advertisement (pre and post), observation in store, mystery shopping, usage and attitude surveys, focus groups for its marketing research programme. Before launching a new product in the market, it is a part of Bata’s marketing strategy to conduct interviews with the targeted customers and ask them about their likes, dislikes and preferences about the Bata brands/ products. Bata conducts marketing research and relevant interviews, distributes discount vouchers and offers other attractive incentives to its expected customers for their active participation in Bata’s marketing research-oriented programmes. The main reason behind the success of Bata Pakistan Limited is direct research process and directly contacting the target customers. It appears mentionable that in regard with the marketing research for new brands, pre-launch marketing research has played a very helpful role for paving the way of Bata’s marketing strategy. Bata’s marketing research system keeps Bata in touch with the needs of Bata’s customers and assists Bata in making its marketing decision.

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 actual and potential buyers of a product and buyers are not homogeneous. Marketing segmentation is vital for well- understanding of the market and it plays a key role for a successful business as it helps you know the target market better than your competitors. Bata’s market segmentation is comprised of geographic, demographic, psychographic and behavioral features of its market segments having taken into consideration of the area (rural/urban/city/town/village), age, gender, social class, occupation, income, personality attributes and lifestyles). For example, from age point of view, Bata segments the age groups into children, young and old age people. From marketing point of view, all the three categories are rationally focused by Bata with the priority to provide the customers the best footwear, comparable both in quality and price, according to the needs of each segment. Bata has come out remarkably successful in children segment that has helped Bata make high sales proving the segment worthwhile.

Positioning is customers’ perception of a product in relation to alternatives on the market. For its being an important part of marketing strategy, positioning has been given due attention in Bata’s marketing strategy. Customers’ attitudes towards Bata’s shoe brands and accessories is regularly observed and measured. It helps Bata identify the scope for new brands and also reposition the current brands. An edge that Bata Pakistan has got on other footwear manufacturing and selling companies in the market is that Bata has a large number of retail outlets throughout the country; it is footwear giant in the country, so it has a much bigger space for impressive and appealing positioning. Supported with good customer service and direct customers contact, Bata has come out with successful positioning.

Bata Pakistan has experienced few mentionable mistakes in its marketing strategy in the past. One of those was when BATA decided to embrace the high-end segments of the Pakistani shoe market as a part of its target market. It launched quite a few brands for this segment with higher price tags. The move landed BATA in trouble. This segment was not meant for BATA. In the first place, this segment was not sizable for a company like BATA. Second, the segment did not get with Bata’s distinctive competence. The segment constituted a mere 5 to 10 per cent of the footwear market in Pakistan. It could not provide the volumes that BATA was used to at the mass end and high volume was essential for BATA for having healthy bottom line. Worse still, the adoption of the segment misdirected Bata’s entire strategy. The top end of the market suddenly became the main focus of the company and it forgot its bread-and-butter shoes that had given the company its identity. And, small regional competitors started nibbling away at Bata’s mainstay. Actually, Bata was squeezed at both ends. At the lower ends, smaller competitors attached Bata’s mass range in schools shoes and chappals, which the company had practically vacated on its own by ignoring them completely. At the high end, niche competitors, who were better prepared, were challenging Bata. From the market share of around 15 per cent in the mid 1999s, Bata found its share slide down to 10 per cent of the footwear market in mid 2000s. The year 2001 saw the company running a loss of Rs. 42 million.

Having faced an adverse situation, BATA successfully reinvented itself as a renowned retailer offering customers the best in footwear in terms of fashion, quality and introduced the concept of flagship stores to provide a complete and unique shopping experience based on modern trends, relaxed 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, and it is a prominently practical example of BATA’ marketing strategy of monitoring and evaluating the marketing strategy in practice and then taking essential steps and changes accordingly as measuring the effectiveness of what has been done, and be prepared to change things that aren’t working.

BATA has effectively worked on consolidating the existing branded business activities into a leading and professional company that has helped in significant reduction of the company’s trade-debt burden. The company is strictly controlling on credit and reducing the outstanding receivables and it is able to augment its financial position to a greater extent. BATA Pakistan has strengthened its position on the stock exchange as evident from increasing P/E ratio and market per share. Backed by increase in demand, EPS has shown an upward trend as well until recently when it declined owing to instability in the country, which depressed the turnout to the retail stores of the company. The net value of the company is not very high. The company proposed a higher dividend in Nov.2007 due to the better results. It raised the final dividends by 20% thus increasing the investors’ confidence.

Increase in the cost of production primarily because of the hike in prices of raw materials, interest rates and transportation costs might pose a challenge to the company. The increased costs might depress sales for the company along with affecting the top-line and bottom-line. Furthermore, Bata Pakistan should increasingly divert its focus towards innovation, new designs and maintenance of its retail outlets in order to keep its customers base intact. The cut-throat competition from the imported cheap price shoes and many new and existing local outlets can significantly affect the company business. In order to maintain its success as a household name for the people of Pakistan, creativity and research for higher quality should lie at the core of Bata product development policy. Bata needs to consistently focus on the development of shoes with exclusive comfort, technology features and designs available to the people through a chain of modern large format and sport concept outlets bringing in new trends to suit the needs of both the traditional and the trendy. Feed back from customers and employees, goof salaries packages coupled with bonus packs for the employees, using customer data, in store speciality/assistance counters, gifts with purchase, incentives for the retailers, promotional items like t shirts with ‘BATA’ printed on them, sponsorship of sports especially cricket as it is the most popular game with the Pakistani people, issuance of loyalty cards and delivery services can be of great help for Bata, particularly in its marketing.