UNIT 2 MARKETING

By Raja Abdullah Sarwar

Table of Contents

INTRODUCTION: .......................................................................................................................... 3

KHAADI BACKGROUND: ............................................................................................................... 3

MARKETING MIX:......................................................................................................................... 4

PRODUCT: ...................................................................................................................................... 4
PRICE: ........................................................................................................................................... 4
PLACE: .......................................................................................................................................... 4
PROMOTION: .................................................................................................................................. 5
PROCESS: ....................................................................................................................................... 5
PEOPLE: ......................................................................................................................................... 5
PHYSICAL EVIDENCE: ......................................................................................................................... 5

DARAZ GROUP BACKGROUND ...................................................................................................... 5

MARKETING MIX OF DARAZ GROUP: ............................................................................................ 5

PRODUCT: ...................................................................................................................................... 6
PRICE: ........................................................................................................................................... 6
PLACE: .......................................................................................................................................... 6
PROMOTION: .................................................................................................................................. 6
PROCESS: ....................................................................................................................................... 6
PEOPLE: ......................................................................................................................................... 7
PHYSICAL EVIDENCE: ......................................................................................................................... 7

CONTRAST BETWEEN MARKETING MIX OF KHAADI AND DARAZ GROUP: ...................................... 7

MARKETING TACTICS USED BY KHAADI: ........................................................................................ 7

BRAND POSITIONING: ....................................................................................................................... 7

BRAND PROMOTION: ........................................................................................................................ 7

MARKETING TACTICS USED BY DARAZ GROUP: ............................................................................. 8

ONLINE AND OFFLINE MARKETING ........................................................................................................ 8

MARKETING PLAN FOR INTERNATIONAL EXPANSION OF KHAADI .................................................. 9

EXECUTIVE SUMMARY ....................................................................................................................... 9

OBJECTIVES .................................................................................................................................... 9
MISSION ........................................................................................................................................ 9
KEY FACTORS TO SUCCESS: ............................................................................................................... 10
COMPANY LOCATIONS AND FACILITIES ................................................................................................ 10
MARKETING STRATEGY .................................................................................................................... 10
PRICING STRATEGY ......................................................................................................................... 10
PROMOTION STRATEGY ................................................................................................................... 11
DISTRIBUTION STRATEGY ................................................................................................................. 11
MARKETING PROGRAMS .................................................................................................................. 11
POSITIONING STATEMENT ................................................................................................................ 11
SALES STRATEGY ............................................................................................................................ 11
SALES LITERATURE .......................................................................................................................... 12
KEY FINANCIAL INDICATORS .............................................................................................................. 12
BREAK-EVEN ANALYSIS .................................................................................................................... 13

BIBLIOGRAPHY:.......................................................................................................................... 14
Introduction:
Marketing is basically a process that involves potential customers or clients in your products
or services, it refers to activities that are undertaken by a company in order to promote the
buying or selling of a product or service. It includes advertising, selling, as well as delivering
products to consumers or other businesses. The concept of marketing is imperative, it
important on the grounds that it characterizes how an organization will conduct its business
and thrive in the desired market. It helps to express that an organization’s essential
occupation is to fulfil the needs and wants of its clients. This can be achieved by figuring out
what the business sector needs and after that adjustment is done the best product or service to
match up to the needs. To attain this primary objective, everybody in the organization must
be devoted to consumer loyalty, a business must target its purchasers to whom they can really
serve adequately. (Kotler et al., 2011).

Khaadi background:

Khaadi was introduced by Shamoon Sultan in 1998, the purpose of establishing this brand
was to change the trend by introducing Pret. It specializes in "hand-woven" technique
products which gives it a competitive edge in the market. Khaadi defines its lines as concepts
in the Pret that is ready to wear; stitched, unstitched including western and eastern trends
along with their bedding and bath items. It even has a semi-formal and formal range of
clothes for both men and women as well as children. Recently, they extended their products
to accessories, perfumes and their makeup products as well. Right now, it has 46 stores, in
17 cities across Pakistan and 17 stores across UK. (Khaadi.com, 2019).
Marketing mix:

Marketing mix refers to putting the right product or a combination thereof in the right time, at
the right place, at the right price. Marketing mix is regarded as one of the tools and strategies
of a business that will be used to on the target customers in order to increase the market
share of the organization.

Product:
Khaadi is offering a wide range of products to its customers including stitched as well as
unstitched clothes for women, men, and kids. Khaadi Women is the main goods line which
cater towards women’s clothes stitched, ready to wear and non- stitched fabrics, along with
accessories like belts, scarfs, bags, necklaces, perfumes, makeup etc. Khaadi Home consists
of furniture including single seat sofas, benches, coffee tables, night tables, beds along with
home accessories like rugs, cochins, cushions & seat covers, beddings, throws. (Khaadi.com,
2019).

Price:
The prices of products at Khaadi is throughout same everywhere within Pakistan. They use
different pricing strategies including phycological pricing as well as premium pricing. Pricing
range keeps changing from season to season, however with the new upcoming stock, the old
stock is sold at a discounted rate.

Place:
Khaadi has its 17 stores in Pakistan in different city, each Shop Front is implemented with a
modern and contemporary appearance with a wide and large glass panels that gives the
outside costumers a clear vision of the inner elements of the shop. Similarly, minimalistic
colourful shop entrance with architraves are cladded with a colourful UV printed wood
strips that tend to reflect the traditional patterns.
Promotion:
Khaadi uses a range of promotional strategies that includes both digital and traditional
platform, this include seasonal sales on social media, advertising on billboards, word of
mouth as well as they seek to believe in direct marketing as well. In addition to this during
festivals such as Eid, Mother’s day, Women’s day, Independence day ; Khaadi tends to
promote these days by offering discounts on some items. Apart from this Khaadi website
plays a vital role in promotion, their promotional videos seek to attract a lot of consumers.

Process:

This process followed at Khaadi is quite similar to any other clothing brand, since it’s a hand-
woven cloth it has its factory located in Faisalabad. The whole process taken into account
Corporate social responsibility; they have maintained a very good image by taking into
account all the ethical processes involved in manufacturing refers to the procedures being
followed at Khaadi regarding manufacturing and selling of products to the consumers.

People:
Staff at Khaadi goes through a rigorous training process before being hired so that customers
are facilitated in every manner. They are given information about each and every product that
is tailored and displayed, staff at Khaadi has also a specific uniform as well. The staff is
highly motivated and efficient in guiding the customers.

Physical evidence:
Flooring of Khaadi, it is a polished concrete flooring will gives a modern look. It is easy to
maintain as it has a sustainable design solution. Similarly, the retail design of the store is
unique with a significant Khaadi Logo which makes it unique from all the other clothing
brands. (Khaadi.com, 2019).

Daraz group Background

Daraz – the 24x7 Online Fashion & Lifestyle Store for which is owned by Chinese. It is
functional in South Asian markets. It was founded by a German venture capital company
back in 2012, it has its logistics services in different countries that include Myanmar,
Pakistan, Bangladesh, Nepal, and Sri Lanka. It made a lot of revenue approximately $50
million but eventually Alibaba Group took over Daraz. It is reshaping the face of e-commerce
by supporting the credo of convenience, while redefining the term shopping and presenting it
to the general population by offering all types of products and service online. Consumers can
choose from the extensive range of men’s shirts, unique dresses for women along with
matching footwear, accessories, handbags and much more - all under one website!

Marketing mix of Daraz group:

Product:
Daraz has everything available on their website, their products include clothes for
kids, men and women; branded accessories as well as, books, toys, TV, home
appliances, makeup, , watches, shoes, electronics, and jewellery. The range of
products at Daraz represent approximately 4 million products of different kinds.

Price:
It uses the price skimming strategy; good quality products are sold at a retail price
which has helped them to increase their sales over a period of time. Similarly they
also give vouchers and discount coupons to their regular customers. Also there are
seasonal sales and buy one free offers available too.

Place:
Daraz group operates online, they don’t have any stores as the products are
delivered directly to the consumers. However they do have warehouses where their
good are stored.

Promotion:
It promotes products through its advertisement on websites, social media etc.
Similarly, they do have promotional videos, their online app is also very significant
to promote products by sending promotional updates and texts. It spends a lot of
money advertising its products.

Process:

The process of Daraz online shopping is simple and easy, all you have to do is that you need
to select the item and add into the cart, once you do that you will have to enter your details
such as Name and Address along with your contact number. Once the details are entered you
will get a confirmation text and the items details that when will it be delivered. You will also
receive the tracking number to see where your product has reached since they have a contract
with TCS and DHL. This way you can track your item, the product is delivered at your
doorstep.
People:
Daraz does exclusive hiring and train the right people to deliver the best services to their
customers, their employees are highly trained and efficient. Around trains 2,000 sellers are
trained which portrays that they invest in their employees as well.

Physical evidence:

Daraz group operates through a website, they don’t have any physical evidence however their
data is stored in their internal database which keep tracks of each and every item. Their sales
are recorded against each transaction which helps them to make keep a track of every
transaction. (Daraz.pk, 2019)

Contrast between marketing mix of Khaadi and Daraz group:

Firstly taking into account that Khaadi, it offers clothing, handbags and other accessories
mainly for women. They have limited products if we compare it to Daraz group. Daraz
group is selling products online which includes clothing, toys, watches and name anything
and you will find it over their website. They have a wide variety of products as compare to
Khaadi. Similarly, the pricing strategy followed by Khaadi is premium pricing while Daraz
group follows price skimming strategy. Other than this Khaadi has its online store as well as
other retail outlets however Daraz group operates to cater its customers only online. Also, it
should be taken into account that Daraz group uses only digital platform to promote its
products while Khaadi promotes its product via digital platform as well as by traditional
marketing strategies. Khaadi serves its customers in the stores through salesman and their
staff, while Daraz group does not have any outlet so they provide any kind of customer
service through telephone or through emails.

Marketing Tactics used by Khaadi:

Brand Positioning:

Khaadi has been able to make its brand valuable, by offering suits at reasonable prices. It
offers such clothing that whenever there is any occasion, anyone can get a new dress that
will fit according to that occasion because of their wide variety of clothing They have made
price justifiable, their prints are easily recognizable and appreciation is given by peers when
you are wearing it. Apart from this Khaadi affects emotional state of respondents, it gives
satisfaction to everyone knowing that they are wearing branded clothes. As the quality is
impeccable, it provides more satisfaction and confidence to the people wearing a light, breezy
and soft fabric.

Brand Promotion:
In 2010, Khaadi entered into the international market, it started to export its pret wear in
various regions. The online store was launched in Pakistan in 2014 which provided ease to
the customers, similarly with time they opened their stores in Dubai, London and so on.
Their Concepts – such as visual merchandising (the use of attractive, seasonal themed shop
windows to attract potential customers) attracted the customers eye and used smaller
aisles to continually engage the shopper’s interest. This way they were able to stand out in
the local as well as the international market.

Marketing Tactics used by Daraz group:

Online and offline marketing

Daraz groups make use of offline advertising which is the attention that is distributed and
discharged outside the Internet. This way it effectively reaches and gets the convergence of
individuals that are presently inside the area of promoting activity. This way Internet isn't
required to influence individuals; such promotions include Events, Mall contrivances,
Posters and print advertisements, Restaurant promos, Product giveaways, Discount
coupons, Radio and TV Commercials, Newspaper advertisements and Flash Mobs. Due to
tremendous popularity of internet almost every company gives their advertisement on the
internet, this is known as the online marketing which is done through social media platforms
such as Facebook, Instgram, Snapchat etc. Some of the advertisements are also played on
different relevant websites, this helps Daraz group to benefit from a vast range of
consumers. (Daraz.pk, 2019)

Daraz group extensively used Google’s entire suite of Advertising solutions in order to
enhance their ROI. The diagram below highlight Google’s potential to attract customers

Some of the targeting techniques which are used for marketing blasts at Daraz are:

 Use of affinities and consumption patterns that help to generate awareness

among people based on their interests and habits – this has increased 15% of
accuracy now as Google has adopted to integrated data from Play Store, Maps as
well as Search Engines

 Using the past google searches of consumers to determine their e-commerce intent
helps to get insights of consumers.

 Usage of remarketing as well as similar audiences in order to reach people who were
most likely to make a purchase. (Daraz.pk, 2019)
Marketing plan for international expansion of Khaadi
Executive summary

Khaadi is going to be an apparel store that caters to the Asian-American and

American community in Houston, Texas. As the name suggests their focus is to provide
eastern as well as western in apparel and accessories, and position ourselves as the top
retail store servicing this particular market. They will be first and only Asian-American
owned western/ eastern apparel store in the city of Houston. Their intentions are to
obtain around 80% of market share and become a central hub of shopping activity for the
local population as well others who enjoy wearing western apparel. Once the market share is
achieved it can expand its products just like in Pakistan including accessories, perfumes,
makeup and also concentrate on its furniture line. It can establish itself furthermore.

Objectives
 To create a shopping environment that will caters to the apparel needs of the urban
Asian-American population

 To earn 80% market share and become the number one ethnic western/ easertn
wear apparel store in southwest Houston, also achieve name recognition in the local
community

 To receive approximately 50% profit margin within the first year of opening

 To obtain a customer base of 1,000 by the end of the first operating year.

 To achieve a net profit of approximately $85,000 by year two and $120,000 by year
three.

 To be an active and vocal member in the community, focus upon the philanthropic
approach by supporting agricultural events, and equestrian organizations working
with children.

Mission
Khaadi’s mission is to offer quality, name brand in eastern and western wear in an
assortment of sizes and styles that will help to accommodate all varying body styles and
shapes.
Key factors to Success:

 Carry an assortment of sizes that will fit the more ample frames of their Asian-
American or any other target customer base.

 Provide customers with top notch personalized customer service that will include a
tailoring service in an atmosphere of southern hospitality.

 Advertise and promote in areas that our going to attract a large customer base who
will learn about their store.

 Continuously review the inventory as well as the sales and adjust their inventory
levels accordingly.

Company Locations and Facilities

Khaadi will be located at 13328 1/2 Almeda Rd., in Houston. The place will be leased for
two years. This location is central to the geographical location for the Asian -American
community in the southern part of Houston. Khaadi wants its name to stand out that’s why
they feel it is essential to locate themselves in the heartbeat of the community. It also
strives to create an atmosphere of acceptance and community, in a good retail environment
where individuals can identify and bond with their culture. (William, 2005).

Marketing Strategy
Their marketing strategy will focus heavily on sales promotion, especially niche positioning
in the market and customer service with loyalty as well as retention in sales. (Schnaars,
1998) Their marketing budget will be limited and not exceed 5% of our gross annual sales.
Khaadi’s promotions will always stay in tune with the company objectives and the mission
statement.

Pricing Strategy
Khaadi will maintain a flexible pricing strategy, as the product lines that they carry on their
reputation and quality ; penetration pricing will be used. Most of their lines come with a
suggested retail price that they follow, Khaadi will utilize the standard practice prevailing
already. (William, 2005).
Promotion Strategy
Khaadi will follow an aggressive yet creative promotional plan, this will allow them to focus
directly on their target customers. (Khaadi.com, 2019). They can make use of a press release
kit that will be sent to all major media outlets in Houston which will highlight the grand
opening of the first Asian-American apparel retailer in the city. This kit will include a press
release including pictures of the interior walls and floor, color postcard flyer, business card
offering discounts too. Radio advertisements on two local FM radio stations can also be
played. Apart from this a direct mail program can also be used to focus on and target the
top 50% customer base. (Schnaars, 1998)

Distribution Strategy
Khaadi retail location will be the foundation of building our customer base. We will also
manage a direct mail program, free delivering service to first 100 customers.

Marketing Programs
Their marketing programs will consist of the distribution of 7,000 coloured flyers on the
opening event, also on the online store a free delivery service would be offered to its 100
customers. (William, 2005).

Positioning Statement
For the more full-bodied individual seeking western/eastern apparel, Khaadi will offer its
pret wear in a larger assortment of styles and sizes to create a competitive edge as readily
available Kurtis in the mass western apparel retailers is not available easily. (Khaadi.com,
2019).

Sales Strategy

 Khaadi will utilize the Retail ICE POS software with every sales transaction, this
way with each purchase their software will record and maintain in its database of
customer's name, address and purchases. This information will be quite useful and
will be used with their direct mailing program to focus on their top 50% of
customers.

 Khaadi will offer a 14 day return/exchange policy in order to to build trust with
their customers and maintain retention and loyalty.
Sales Literature
Khaadi will make use a targeted advertising and sales program in order to generate
publicity and build a customer base.

 1,500 full-color postcard flyers with a 10% coupon will be distributed throughout
southwest Houston area to create awareness.

 200 grand opening invites will be mailed to the potential new customers two weeks
before the grand opening. The invitation will have a promotional 10% coupon off a
customer's first purchase from the store.

 1,000 business cards with a Khaadi Card on the reverse side entitling that the
customer will get a 25% discount on the eleventh purchase after ten purchases .

Key Financial Indicators

The following chart will show the benchmark figures for Khaadi’s international
expansion in Houston .
Break-even Analysis

Khaadi would need to sell 5 units in order to cover their fixed costs. If you sell your anticipated 100,000
units then your profit/loss would be $12,999,300.
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