ADVERTISING

&

SALES PROMOTION Salesforce & Channel Distribution

Assignment

ABSTRACT The case-study is about the Advertisement &

Sales Promotion of Randall’s Department Store

and contains data analysis.

SUBMITTED BY

Darshil Dholakia - 15021141016

Rupesh Jha - 15021141050

Siddharth Desai - 15021141060

SUBMITTED TO Dr. B. R. Londhe Professor & Deputy Director

INTRODUCTION

Randall’s was a downtown department store in Bilingsville had 12 branches. It was founded

by Elliote O. Randall who opened the downtown Bilingsville stores in 1890. Descendants of

the founder continued to play major role in the management of the company. All were

situated in an upper Midwest state in a trading area of approximately 3.7 million inhabitants

that encompassed Bilingsville, a major city and its surrounding area.

Emily Randall and Caroline Randall were president and Chairman of the board respectively.

The reporting structure within Randall’s was similar to that in many traditional department

stores. The three General Merchandise Mangers (GMM) & The Vice President for sales

promotion and for the stores reported to Emily Randall.

ADVERTISEMENT

Print Media

• Including Inserts in Local Sunday Newspaper advertising and catalogues. It

was mainly used for “Sales” advertisements, because price reduction on the

numerous items could be communicated efficiently. Both Sunday Inserts

(upto 60 pages of color presentation showing sale & regular price as well as

Value Price Merchandise) and ROP (Run of Press) were used for Sales

Advertising. ROP ads were black & white advertisements within the body of

newspaper itself.

• The Women’s division also used ROP advertising, often with quarter and full

page illustrations or photographs of single garment. Such ads typically

appeared on Mondays & Tuesdays and emphasized in – Season, full priced

fashion merchandise

Television & Radio

• Major storewide sale events were advertised on Television, Radio as well as in

newspapers.

• Substantial portion of advertisement used to be done on television on

Thursday & Friday for weekend days.

Advertising budget

• Randall’s advertising budget included both funds for “general” advertising and

“GMM” locations.

• General advertising expenditures included outlays for major Store-wise sale

events.

• Funds allocated to “GMM” (General Merchandise Manager) were distributed

to their Divisional Merchandise Manager. This funds were used for the

focused events like ‘The Home Stores White Sale’ and to pay for any

additional Sunday Inserts done at the discretions of GMMs.

Focused Supplemental Advertisement

• During Store wide sale period (for fashion ROP advertising, and for any

catalogue advertising).

SALES PROMOTION

• Extra Value Days sales events

• Pre-season sale (on coats & shoes for women)

• Direct Mail Advertisement ( 3 % off coupons )

• Anniversary sales and Coupon discount

• Every Day low Pricing (Women’s Fine Jwellery, men’s suits, children clothing)

• Cohesive Price Strategy.

• Focused events like the Home Store’s White Sale.

• Store wide and divisional sale events.

• 4 Day Extra Value sale event in a month.

• 1 Day Extra Value sale Special Red Extra Value day signs to highlight extra value

merchandise.

• Some specific store wide sale specific to certain geographic location- Billingsville

Saturday sale, Bargain weekend sales in suburban stores.

• Incentive based compensation, commissioned sales staff.

Promotional Calendar

CONCERN OVER ADVERTISEMENTS & SALES PROMOTION

• Sales advertisement more on print media than on television.

• Reduced circulation of print media and tendency of younger consumer not to be

heavy reader.

• Excess use of ROP and Sunday inserts resulted in visual clutter.

• Too much dependence on weekend sale events (more than 25% sales used to happen

in “4 day Extra Value sale” in a month.

• To achieve above newspaper as well as television advertisement used to be done on

every Thursday and Friday. So more sale on crowded weekend as compared to free

weekdays.

ANALYSIS – RANDALL’S HISTORICAL ADVERTISING

EXPENDITURE

• CAGR- Spring ( 1983-1989) = 15.49 %

• CAGR - Fall( 1983-1989) = 22.47%

• CAGR - Total( 1983-1989 ) = 15.49 %

• There is a decrease in advertisement expense from 1988 to 1989 though the total sales

had increased.

Total Advertisement Expense on Radio and Television

D.H Humphrey < Randall’s < Prescott’s

ANALYSIS ON ADVERTISING EXPENSE ON SELECTED BRANDS

• Total Advertising Budget(Gross Advertising Budget ) = “Net Advertising Dollar” + “

Co-operative Advertising Dollar”

• Co-operative advertising dollar often higher than the DMM advertising Fund.

Category Ad. Expense ($) DMM Fund $ (Internal) Cooperative Fund $( Vendors)

Children 434435 301920

Fine Jewellery & Fashion Accs. 678810 852465

Décor. Home Furnishing 901170 1302625

Men’s clothing 525045 551140

Women’s Clothing 636055 487645

CONCLUSION

Advertisement is an important aspect for a business like Retail Store which keep

offering various schemes on day-to-day basis. Randall’s were too much dependent on

this schemes like ELDP, Extra Value Day, etc. which is not viable solution for

sustainability.

A Business offering such schemes on daily basis does not survive for long period of

time and also adversely affects the brand name.