Segmentation

Thompson-Smith is one of Australia’s largest retailers. They have around 1,000 different stores, across fivebrands, namely:Tommy’s Supermarkets (500 stores),Tommy’s Clothing (17 stores),Smith’s Shoes (100 stores),Smith and Chips (300 stores), andT+S Gas (fuel) (100 stores).They have set their vision as being Australia’s number three retailer, behind the two dominant players. Theyhave defined their strategic priorities as:

Reposition the Supermarket chainTommy’s generally targets budget shoppers. It primarily competes with lower-priced, smaller supermarketschains. It is important that we reposition our stores as full-service, higher quality supermarkets. This will enableus to compete directly with the major chains. As part of this strategy, we will introduce ‘fresh food’ sections of status:Junior Levelbalance:$75.04rating:4.762/9/2021 Order 336351984https://admin.writerbay.com/orders_available?subcom=detailed&id=336351984 2/3our supermarkets, relocate many stores to more prominent locations, and introduce a broad range of privatelabel brands.Add Tommy’s Clothes OnlineOnline channels have been slowly taking a greater share of retail sales. To date, Thompson-Smith has notentered the world of e-tailing. Tommy’s Clothes, our chain of fashion clothing stores has been chosen as thefirst venture into multi-channel retailing In order to promote this new channel, a significant promotional effort(using mainly billboard advertising) will be embarked upon over the next 12 months.Franchise Smith’s ShoesOur chain of men’s shoe stores has been performing generally well. However, there is a clear franchise trendwithin the Australian market at the moment. Therefore, this presents a growth opportunity for us. The plan is tofranchise around half of the existing stores and to add another 100 stores through franchising.Redesign Smith and Chip’s StoresOur chain of fast food (fish and chips) stores is lacking in the facilities of our more aggressive competitors, inparticular McDonald’s. Over the next five years, all our stores will be redesigned to include a kid’s playground,lounge area, a drive-through, and increased parking. In order to gain a competitive advantage, we plan to addan ‘amusement arcade’ section (which will both generate income and differentiate us in the marketplace).Enhance the Loyalty Programs of T+S Gas/FuelThis sector is becoming more competitive, with the joint ventures of the major supermarkets with existinggas/fuel suppliers. In order to compete, we need add a loyalty program that provides an incentive to purchasepetrol (based on a discount earned from purchases at our other stores).QUESTIONS(Please answer each question with more than an “I agree” -at least 25 words)To what extent do you agree with their strategy for one of these #1-4?To what extent do you agree with their strategy for another one of these #1-4?To what extent do you agree with their strategy for their loyalty program?What other strategies could they possibly consider?

Sample Solution

Segmentation

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