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JD Sports Fashion Plc has long been established as the leading UK specialist multiple retailer of fashionable branded and own brand sports and casual wear, principally through the growth of its main retail fascia, JD Sports.
The JD Group now has well over 900 stores covering both sports and branded fashion but it all started when John David Sports was founded in 1981 with one shop in Bury. By 1983 the fledgling business was expanding into the Arndale Centre in Manchester and throughout the 1980s there were further openings, largely in the North and Midlands. The first London store was opened in Oxford Street in 1989 and by the time of JD’s stock market flotation in 1996 there were 56 stores. Maximum advantage was being taken from the growth in sales of international sports brands such as adidas, Nike, Reebok and Puma and the trend to wear sportswear more and more in everyday life rather than largely on sports fields. Additionally, JD had already developed its reputation as the most innovative visual merchandiser of sportswear with the best and most exclusive and stylish ranges.
The business continued to grow organically until 2002 when it acquired nearly 200 further stores with the acquisition of First Sport. Nearly all of the stores retained from this acquired portfolio have subsequently been converted to the JD fascia. In 2005, JD also purchased over 70 stores from Allsports, thereby further consolidating its position as the leading UK retailer of fashionable sports and casual wear. JD operates in both the UK and Republic of Ireland and, through Chausport, in France.
The JD Group also has a significant branded young fashion offering following the acquisition of Scotts in December 2004 and Bank Fashion in December 2007. These fascias have a combined portfolio of more than 100 stores across the UK and are well known for their dynamic approach to the branded fashion market with a new mix of brands introduced each season. Both of these fascias trade online at www.bankfashion.co.uk and www.scottsonline.co.uk.
2009 saw further expansion of the JD Group through the acquisition of Chausport which operates from 75 small stores in France.
In addition in 2009, JD acquired the world famous rugby heritage brands ‘Canterbury’ and ‘Canterbury of New Zealand’ as well as ‘Kooga Rugby’ brands.
JD has a controlling interest in www.getthelabel.com. This site is aimed at providing families with their branded fashion needs at attractive prices. (1,2)
Introduction of Marketing:
“The management process that identifies, anticipates and supplies customer requirements efficiently and profitably”
“The achievement of corporate goals through meeting and exceeding customer needs better than the competition”
To help put things into context, its helpful to follow diagram which summarises the key elements of marketing and their relationships: (3,4)
Overview of the marketing process
Contribution of Marketing to the Achievement of Business Objectives:
Market won’t succeed if they don’t have objectives.Preparing a marketing plan to achieve the marketing objectives is a complex process, There is an erroneous assumption, that a spread sheet of numbers relating to allocated spending on the various activities of the marketing function is sufficient to be called a marketing plan. Setting objectives is the first priority, because it defines what is to be achieved to support the requirements of a firm’s corporate plan. Setting of marketing objectives should be largely quantifiable and thus measureable.
Having set out the objectives, the most important part of the planning process is the listing of the actions necessary for their achievement.
Marketing objectives also relate to the “4 Ps” of the marketing mix, namely product, price, promotion and place or market, but should also include quantifiable objectives such as marketing contribution and optimum performance.
Preparing alternative actions to be used when the unexpected happens or the contracts fail to materialize, is an important planning process that is frequently forgotten.
To illustrate how assets and investment are to be used to achieve the objectives of the marketing plan, a profit and loss projection is required together with a detailed marketing budget showing the allocation of resources. (5,6)
The Role of Marketing for Non-Profit Organizations:
Marketing is now accepted as a strategic discipline or general management function and in this respect must care for the health of a business in the future – especially against competitive influences.
Marketing is not just a series of business-related functions, but more wide-reaching than this. It is a business philosophy designed to develop an attitude of mind which should be shared by everyone in an organisation and is often enhanced by both frequent and open communication. Developing such an attitude of mind reduces the likelihood of crisis and contributes to the development of the overall future of an enterprise at both strategic and tactical levels.
At the heart of marketing lies the degree to which an organisation becomes marketing-orientated. The more committed a company is to its marketing activities, the more able it will be to pursue its corporate objectives and develop and retain customers. Every business in existence relies upon its customers for survival, and those who best meet customer needs will always survive a period of change.
The marketing function is therefore an essential ingredient of corporate strategy, and this marketing focus should be communicated through marketing planning into all aspects of business activity. (7)
Below are eight steps that get started in brainstorming marketing ideas that could make a significant difference in the organization.
Define target market, research similar organizations and associations.
Determine the desired outcome of marketing efforts.
Develop brochures and marketing materials that describe the benefits, services, donation opportunities, and values of organization.
Develop a social media marketing strategy.
Develop and maintain a professional internet marketing presence by creating a web site.
Research and maintain Company prospect and customer databases.Use them for special mailings, follow-up telephone calls, event invitations, alliance development, research profiling, and market segmentation.
Show and advertise the results and objectives that an organization achieves.
Always actively search for alliances with other organizations, commerce, government, advertising media, and business.
These steps brings the most benefit to nonprofit organizations. (8,9,10)
Key Elements of Marketing:
There are some crucial elements of marketing which are very necessary for the success of marketing and they form the backbone of marketing.
1) Research: To determine what the market actually wants. Market research is needed to determine what message should the company adopt and which medium will be best, what positioning needs to be achieved to target the right segment.
2) Strategy – Once the data ready, it should be known where, the product stands and also the standing of the company in the market in terms of strengths and weaknesses. Now the strategies will need to be implemented and factors will need to be adopted by the company to beat competitors and succeed in the market. Thus, after research, strategies decide the vision of the company, its goal, its mission and in general where the company wants to be.
3) Planning:The marketing plan involves sales forecasting, financial planning, communications strategy and many such benchmarks which define how the company is going to achieve its strategic goals in the future. The planning department also keeps a track of the timeline so that time to time, it determine whether company is on track with the strategic plan or not.
4) Tactics: Where planning happens at the topmost level, tactics are the street smart, short term plans be implement to attract customers, and beat competitors, increase sales, provide a better value to customers or for any other short term objective which needs to be achieved. Due to the competitive nature of these industries, smart tactics are absolutely necessary to achieve good revenues and for customer acquisition. (11)
Elements of the Marketing Mix:
Marketing mix is the combination of the elements of marketing and roles each element plays in promoting products and services and delivering those products and services to customers.
Product – The products or services offered to the customer: Their physical attributes, what they do, how they differ from the competitors and what benefits they provide.
Price – The price of product or service remains competitive as it allows to make a good profit.
Place (Distribution) – Business sells its products or services and it gets those products or services to customers.
Promotion – The methods used to communicate the features and benefits of the products or services to the target customers. (12,13,14,15)
Methods of Segmenting Markets:
The objectives of market segmentation are to more accurately meet the needs of selected customers in a more profitable way. These are given below,
Seperates households according to their social class, life style & personality
What people buy
How often people buy
How loyal people are to certain brands (16,17,18)
Benefits of segmenting markets:
There are several advantages of market segmentation,
1) Focus of the Company: Segmentation is an effective method to increase the focus of a firm on market segments. If better focus, obviously it will have better returns. Thus companies base their strategy completely on a new segment which increases its focus and profitability.
2) Increase in competitiveness: Naturally, once focus increases, competitiveness in that market segment will increase. Once the market share of company increase, the chances of a new competitor entering might be low. The brand loyalty will definitely increase
3) Market expansion: Geographic segmentation is one type of segmentation where expansion is immediately possible. If you have your market strategy on the basis of grography, then once you are catering to a particular territory, you can immediately expand to a nearby territory. In the same way, if you are targeting customers based on their demography (Ex – reebok targets fitness enthusiasts) then you can expand in similar products (Ex – reebok expanding with its fitness range of clothes and accessories).
4) Customer retention: Customer retention can be encouraged through the life cycle of a customer. The best example of this is the Automobile and the Airlines segment. You will find major example of customer life cycle segmentation in the Hospitality segment whether they be hotels, airlines, or hospitals.
5) Have better communication: One of the factors of marketing mix which is absolutely dependent on STP is Promotions or communications. The communications of a company needs to be spot on for its TARGET market. Thus if you need a target market, you need segmentation. Communication cannot be possible without knowing your target market
6) Increases profitability : Segmentation increases competitiveness, brand recall, brand equity, customer retention, communications. Thus if it is affecting so many factors of your business, then definitely it affects the profitability of the firm.One of the USP’s of these brand is their segmentation. They are in fact targeting segments which have no need of bargaining or negotiation. Thus their profitability is high. (19,20,21)
Methods of Conducting Market Research:
When it comes to gathering data a company conducting market research has a variety of options available depending on the type and quantity of data required.
This involves conducting questionnaires over the phone with existing customers or a random sample of people or businesses who match the required criteria.
Useful for gathering large amounts of quantitative data to which you can apply statistical analysis or for conducting qualitative interviews. Telephone research has the benefit of increased customer engagement and returning results fast.
Soliciting users of particular websites to fill in questionnaires or emailing the surveys to a database of customers or a random sample. It can simultaneously target large numbers of potential responders for gathering large quantities of data.
Sending out surveys to customers or a random sample of appropriate people which they return by post.People take more time over manually completed questionnaires improving answer quality.
Aka Access panels. Focus groups comprise a selection of appropriate people who give feedback on a brand, product or service which is recorded by the market research company. This method is used to obtain qualitative data like how consumers ‘feel’ about a particular brand or product. Clients can sit in or watch a live or recorded video feed to gain first hand insights.
Face to Face
Sending out researchers to interview members of the public in person on the street, door-to-door or in stores. It can be used to gather quantitative or qualitative data. Using passers-by ensures randomness of sample. People give more considered answers face-to-face.
Some market research agencies gather, publish and sell industry specific reports which include data like market size, key players, industry press, government involvement etc. Industry snapshot which is useful for moving into new markets or territories. (22,23,24)
The Impact of Current Technology on Marketing:
Technology has a tremandous effect on the marketing, It effects of the elements of marketing mix by different ways, described below,
The Internet is changing the product and services available in a big way. In professional services, the Internet is allowing firms to develop new ‘packaged’ products – sometimes by providing integrated or related services such as financial and estate agents services. Using extranets means that certain clients can be provided with access to the firm’s internal systems which both adds value and ‘locks in’ clients to the given service.
The expansion of the Internet is creating new issues in terms of contractual rights and copyright too.
The Internet allows a lot of information to be obtained easily by customers. One side effect is that it is much easier to compare prices making price competition fiercer. The use of computer systems to reduce the time and effort involved in producing and delivering products and services means that suppliers can either increase their margins or offer the same services at a lower price. Commoditisation is also occurring where people ‘package’ new products and services together and offer them, via technology, at a lower price (the high volume, low value approach). On-line payment (through credit cards) makes it more convenient to clients/customers and can make cash collection quicker and cheaper for suppliers – again increasing the possibility of price reductions. Yet the Internet can make it more difficult to offer discriminatory pricing (i.e. different prices for different customer groups).
The developments in the power of databases means that direct marketing is really coming to the fore allowing new segments to be more easily identified and allowing segments-of-one to be profitably targeted. Permission marketing has been born but is still in its infancy. The Internet is also a great source of information – allowing you to keep up with your competitors’ and clients’ activities. On-line polls and surveys can yield a large amount of additional information about your clients.
It also means that it is much more difficult to retain any form of differentiation when your services and approach are clear for all – including your competitors – to see.
In just about every sphere of promotion – advertising, direct marketing, personal selling, public relations – CD Roms, web sites, personalisation and interactivity are making fundamental changes to the way marketing works.
You need a web site – even if only as an on-line brochure. You need to advertise to get traffic to your web site. You can provide a web address in advertisements to provide further information or to capture customer information and orders. Digital television and the broadcasting revolution (including web TV) makes mass advertising practical and affordable for much smaller companies than previously. There are all sorts of new advertising media now available – electronic posters, information kiosks, banner advertisements, on-line directory entries etc. Interaction and multimedia are challenging the creative treatments of advertising as well.
Database technology aligned with digital printing of short runs of full colour promotional materials has had a dramatic impact on direct mail. Email lists make it easier to have more regular and focused communications with key customers and clients. The use of call centres and computer assisted voice telephony are rewriting the books on customer service and fulfilment. Permission marketing is where customers provide information about their needs and preferences and agree to the supplier using this information for further marketing activities.
Brochures and publications are now electronic, interactive and tailorable to the specific needs and interests of smaller markets and even individuals. On the WWW, the customer decides what information they require and in what order so some level of supplier control is lost. Desktop design and publishing is reducing the need for and cost of expensive designers and printers – sadly, good design is becoming rarer as more amateurs try their hands. Client communication programmes are much more easily maintained through the use of email and electronic communications – which also reduces the cost of postage. Media relations can be enhanced by providing background information and news releases on web sites.
Those tasked with selling can use the Internet to undertake fast research into prospects. Electronic presentations can be easily tailored and presented desk side or remotely (by email or teleconference). Databases have revolutionised client and contact management systems and field sales staff effectiveness and supervision. (25,26)
Case Study JD Sports plc.
The Business Position of JD Sports :
JD wants to position itself away from competitors to give it competitive advantage. This means that high profile manufacturers and brands will prefer to release their products to JD rather than its competitors as they are likely to sell more products and protect the brand’s positioning.
JD Place involves making products available to the customer in the most convenient way. JD operates in high streets, shopping centres, out-of-town locations and online. JD’s shopping experience is distinctive from rivals through creative displays and imagery, making the store experience fun. JD regularly analyses store and sales performance to assess where outlets are giving the best return on investment.Recognising the increasing trend for online shopping, JD also invests in e-commerce.
â€¢ quality of its customer service : particularly its clear delivery and returns information
â€¢ its checkout process : which is simple and easy to use
â€¢ its product pages : with photography that provides consumers with the most helpful views of products before they buy. (27,28)
JD Sports Products Distribution:
Established in 1981 with a single store in Bury, in the North West of England, JD Sports Fashion Plc is the leading retailer and distributor of branded sportswear and fashionwear.
JD Sports Fashion Plc is engaged in retail and distribution of sport and athletic inspired fashion, footwear, apparel and accessories. It operates in three segments:
sport retail, which includes results of sport retail trading companies JD Sports Fashion Plc, John David Sports Fashion (Ireland) Limited, Chausport SA and Duffer of St George Limited; fashion retail, which includes results of fashion retail trading companies Bank Fashion Limited and RD Scott Limited, and distribution businesses, which includes results of distribution byTopgrade Sportswear Limited, Nicholas Deakins Limited, Canterbury Limited (including global subsidiary companies), Kooga Rugby Limited and Nanny State Limited.
Following the recent acquisition of the trade and assets of the Blacks business, the Group now has over 900 stores across a number of retail fascias in four countries and is proud of the fact that it provides its customers with the latest products from the very best brands.
The Group also operates on-line businesses for these retail fascias, providing the Group with a truly multichannel, international platform. (29,30,31)
JD Sports pricing strategies:
The price charged for a product will depend on a number of factors: the cost to make it, the level of profit required, competitor prices and the price consumers are willing to pay. Getting the price right is a key part of an organisation’s marketing strategy.
This is because it is the price that directly generates income, allows debts to be paid, re- investment to occur in the business infrastructure and profits to be made.
There are different pricing strategies,
Market penetration – introducing a new product at a lower price to help gain market share.
Competitive pricing – often used for well-known products or brands that are in high demand. Prices are similar to competitors. To be competitive, JD must ensure it doesn’t charge higher prices for the same goods than other sports and fashion retailers.
Strategic pricing – This might be used to position an exclusive product or brand to make it more desirable for consumers and generate demand or demonstrate value. (32)
JD Sports Promotional Strategy:
The purpose of promotion is to create awareness in consumers or generate interest and desire to buy products. Promotion can also be used to create or change a brand image and maintain market share. JD wants to position itself away from competitors to give it competitive advantage. This means that high profile manufacturers and brands will prefer to release their products to JD rather than its competitors as they are likely to sell more products and protect the brand’s positioning.
Above-the-line promotional activities
paid-for advertising in newspapers and magazines.
product placements in a range of publications are used to promote the different brands
TV and radio advertising.
Below-the-line promotions activities
Sales incentives, promotions and competitions with celebrities,For example, JD partnered with adidas to provide VIP tickets for an exclusive N-Dubz event at the O2 Arena for JD.
Sponsorship and product endorsement by celebrities and music artists are used to highlight new ranges and products. For example, Tinchy Stryder promoted the Star in the Hood clothing range and The View promoted The Duffer of St George range in a press campaign.
JD partnership with the Manchester Evening News Arena not only puts the brand in the arena itself, but also enables the company to feature competitions and offer prizes to capture potential custom.
JD also uses impactful photography and high quality point-of-sale materials in stores and window displays to attract consumers and increase footfall. Growth of social media such as Facebook and Twitter also enables the company to use consumer recommendations as part of its promotional activities.(33)
Aims & Objectives Of JD Sports:
JD aims to make profits, for that JD set smart targets, which are practical objectives which have to be achieved. It breaks down the objectives into achievable targets. The targets have to be specific, measurable, achievable, and relevant and time specific in order to be accomplished.
JD’s made revenue of £300m and £12.4m in operating profit. It is likely that they would like to increase their turnover and operating profit. For example there aim could be to reach £360m and £12.7m in operating profit by 2010.
Their objectives which lead up to their goals could be to:
open new stores
expand existing stores
introduce loyalty or store cards
introduce wider stock
buy out a rival company
update website regularly- online shopping (34)
Macro and Micro Environmental Factors:
macro marketing environment
The political environment includes all laws, government agencies and lobbying groups that influence or restrict individuals or organisations.
The economic environment consists of all factors-such as salary levels, credit trends and pricing patterns that affect consumer spending habits and purchasing power.
The socio-cultural environment includes institutions and other forces that affect the basic values, behaviours, and preferences of the society-all of which have an effect on consumer marketing decisions.
The technological environment consists of those forces that affect the technology with which can create new products, new markets and new marketing opportunities. (35)
Micro Environmental Facorts:
As all businesses need customers. The firm’s marketing plan should aim to attract and retain customers through products that meets their “wants and needs” and excellent customer service.
Employing staff with relevant skills and experience is essential. This process begins at recruitment stage and continues throughout an employee’s employment via ongoing training and promotion opportunities.
Suppliers provide businesses with the materials they need to carry out their business activities. Close supplier relationships are an effective way to remain competitive and secure quality products.
As organisations require investment to grow, they may decide to raise money by floating on the stock market i.e. move from private to public ownership.Shareholder pressure to increase profits will affect organisational strategy.
Positive media attention can “make” an organisation and negative media attention can “break” an organisation. Organisations need to mange the media so that the media help promote the positive things about the organisation and reduce the impact of a negative event on their reputation.
Competitor analysis and monitoring is crucial if an organisation is to maintain or improve its position within the market. If a business is unaware of its competitor’s activities they will find it very difficult to “beat” their competitors. (36)
JD Sports Marketing Mix:
By focusing on the needs of consumers, an organisation creates a business that can outperform its competitors. Being closer to consumers and providing exactly what they want is known as market orientation. A market orientated business carries out research to find the needs and wants of consumers. It then uses the findings to design products and marketing strategies to satisfy these needs. This compares to product orientation which focuses first on developing a product and then seeks ways to persuade the consumer to buy it. JD (part of the JD Sports Fashion PLC Group of companies), a large and well-known retailer, manages the balance of its marketing mix around its consumers’ needs in order to achieve business growth. The marketing mix is often termed the4Ps (place, product,promotion and price). It is a useful way of looking at how organisations reach their consumers.
For example, businesses need to create a mix that involves:
â€¢ the right products
â€¢ sold in the right place
â€¢ at the right price
â€¢ using the most suitable forms of promotion. (37)
JD’s marketing mix has created a unique position for the brand within the mind of its consumers whilst remaining true to it corporate values. The company focuses on stocking the products its consumers want, as well as offering distinctive or exclusive ranges that can only be bought at JD. This, combined with its choice of strategies for placing and positioning the brand, has resulted in significant growth for the business. (38)
JD’s marketing mix has created a unique position for the brand within the mind of its consumers whilst remaining true to its corporate values.
The company focuses on stocking the products its consumers want, as well as offering distinctive or exclusive ranges that can only be bought at JD. This, combined with its choice of strategies for placing and positioning the brand, has resulted in significant growth for the business.
By uniquely understanding and valuing consumers, JD continues to grow within a difficult economic and competitive market. By constantly adapting and changing its marketing mix through a focus on consumers, it has effectively managed to stay ahead of the competition. (37)
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