Varun Supermarket Retail (P) Ltd.’s Marketing Research (A): Analysing Store Image through Factor Analysis

Varun Supermarket Retail (P) Ltd.’s Marketing Research (A): Analysing Store Image through Factor Analysis

started by Varun Kumar (Varun), an MBA graduate. Varun wanted to have his own retail business for which he secured capital from his family and registered a retail  company under the name of VSRPL in January 2010. The store was located in a prime location, where many educational institutions (colleges and schools), shopping  complexes, independent shops, retail chains, restaurants, etc., were located. VSRPL’s product range included staples, fresh vegetables & fruits, milk, FMCG, frozen  foods, small appliances and gift articles.

Varun recruited a Store Manager, three Executives and an Admin-cum-Accounts Executive for VSRPL. Varun, himself attended to client calls as a Customer Care Executive on most of the days.

Although, Varun used both Above The Line (ATL) and Below The Line (BTL) promotional strategies for inducing the sales and revenue growth of VSRPL, the sales were  plummeting (Exhibit I). He observed that for the last 8-9 months, the number of repeat customers was also dwindling continuously..........

Assignment Questions

I. What is factor analysis? According to you, how is it different from other related techniques – ANOVA, multiple regression and discriminant analysis?
II. ............

Exhibits

Exhibit I: Quarterly Sales Breakup Value for 2015-2016 (in INR)

Varun Supermarket Retail (P) Ltd.’s Marketing Research (A): Analysing Store Image through Factor Analysis

Synopsis

Although Varun Supermarket Retail (P) Ltd. (VSRPL) is positioned in the prime area in the city where many educational institutions (colleges and schools),  shopping complexes, independent shops, chain stores, restaurants, etc., are located, it witnessed a decreasing sales trend for the past year. Moreover, the  Founder, Varun Kumar (Varun), observed a decrease in repeat customers in the last few months. When Varun approached his mentor and uncle for a solution, he  was suggested that he should get a market research done. He could take help of students/interns to take this project as their internship project. After discussing  with their Professor, the interns designed a feedback questionnaire and collected data. The interns wanted to identify the underlying factors that influence a  customer purchase from a super market with the help of factor analysis.

Prerequisite Conceptual Understanding

• Naresh K. Malhotra and Satyabushan Dash, “Factor Analysis”, Marketing Research An Applied Orientation, 6th Edition, Pearson Education, 2010 – To understand the concept of factor analysis

Case Positioning and Setting

This caselet can be used in MBA Program – Marketing Research Course – To introduce the participants/students to the concept of factor analysis

Assignment Questions

• I. What is factor analysis? According to you, how is it different from other related techniques – ANOVA, multiple regression and discriminant analysis?
• II. What are the steps involved in conducting factor analysis? Would factor analysis prove to be helpful to VSPRL?

Preamble to this Caselet Analysis

This caselet’s purpose is to introduce the students/participants to the concept and process of Factor Analysis. Building on from the previous chapters (of  defining an appropriate Marketing Research Problem), this caselet provides scope to recommend a solution to the marketing research problem. Accordingly,  this caselet in the light of VSRPL’ sales problem orchestrated the classroom analysis and discussion as shown in Exhibit (TN)-I..........