John Lewis

John Lewis is a chain of upmarket department stores operating throughout Great Britain. The chain is owned by the John Lewis Partnership. This business was founded in 1864 and have 45 stores throughout England, Scotland and Wales. John Lewis aim to keep their staff satisfied so that their business can be a successful. Their strategy is based on three key elements partners, customers and profit. The John Lewis Partnership's (81,000 Partners) own the leading UK retail businesses - John Lewis and Waitrose.

Aims, Strategies and Objectives of the Business

John Lewis' strategy for their business is "underpinned by three Aims". They are designed to make their business bolder, clearer and more confident in order to have a better approach so that they are able of producing a better way of doing business. Delivering on their Aims ensures that, as their business grows, they respond better to new demands and continue to make the most of our co-ownership model. Underneath all their activities are the Partnership's ethical principles and their commitment to do business in a fair, sustainable way.

John Lewis' three interdependent aims- http://www.johnlewispartnership.co.uk/about/our-strategy.html

"Our strategy is based on three interdependent aims which together will make us a successful business. - information shown below.

My research found that John Lewis is generally seen as the market leading department store by those involved in promoting and developing city centres. In Leicester, attracting John Lewis was a key step towards providing a retail offer competitive with other cities in the region. For each development, John Lewis was seen as a catalyst in securing other retailers to commit. The record of successful long-term investment by John Lewis inspires confidence in other retailers and businesses to establish city centre premises; the lease for John Lewis Leicester extends to 240 years.

Public sector

John Lewis aim to meet quality standards and aim to improve efficiency within their business in order to keep their customers and partners happy with how the business operates. John Lewis make sure their staff is of the best quality in order for their customers to have top quality services once they walk into a John Lewis store.

"Our in store services range from personal styling and nursery advice to appliance installation and technical support and for selected services you can book an appointment online.

To find out more, visit Our Services (www.johnlewis.com/our-services).

In addition to these, in selected stores you’ll find additional services such as John Lewis opticians, Bureaux de Change, Kuoni Travel concessions, beauty services such as spas and brow bars and catering concessions from Joe & the Juice and Rossopomodoro.

For advice online, there are over 50 buying guides available (www.johnlewis.com/buying-guides)."

Marketing Objectives

John Lewis marketing objectives is to build upon brand awareness and customer perceptions. John Lewis' method of reaching their marketing object was developed by the company in 2003 on the basis of 'SOSTAC' framework.

S : Situation analysis - where are we now?

O : Objectives - Where do we want to go?

S : Strategy - How we're going to get there?

T : Tactics - What are the details of the strategy?

A : Action - Implementing how the plan will take place.

C : Control - Measuring, monitoring, reviewing & updating.

John Lewis markets with creating campaigns supporting their products and as well as constantly promoting their high quality of customer service. Their customer services results are top quality except during the winter period where they lack to have many popular items in stock.

This links to the success of the overall business as they need to please their customers in order to get repeat purchase and to attract new customers. This will mean that the business meets their goals and means that the morale within the business is of a top level so that all staff stay in a positive mentality leading to the business to develop growing.

Screenshot showing top quality services from John Lewis.

Private Sector

John Lewis' partners achieve their best progress at work, it creates a competitive however motivational advantage for the entire partnership – happiness makes John Lewis all the more motivated and effective. They aim for Partners to gain their own personal satisfaction by being members of a co-owned company where they have worthwhile and fulfilling employment, as well as a realistic sense of community.

Realising market potential is also a large objective for the company. John Lewis aims to attract new customers, and keep and develop the relationships with the ones they already have. They do this by better understanding and quickly acting to the changes that are needed, that be competitive pricing, flexible shopping for customers, even easy to use product sourcing. Enhancing then sustainability programme will support and develop John Lewis' position in the market.

Growing the company efficiently helps business growth that will continue to show importance. However, growth increases business complexity and would have a impact on John Lewis' costs. Focussing on efficiency has become more important to achieve a balanced and profitable growth within the organisation, whilst producing profit to their Partners, they need to prioritise investments and further show cost control discipline.

Ansoff Matrix

Ansoff Matrix is a strategic marketing planning tool that links a firm's marketing strategy and presented in four alternative growth strategies as a table (matrix). These strategies are seeking growth: 1. Market penetration: by pushing existing products in their current market segments. 2. Market development: by developing new markets for the existing products. 3. Product development: by developing new products for the existing markets. 4. Diversification: by developing new products for new markets.

How John Lewis use Market Penetration

Market penetration is one of the four alternative growth strategies in the Ansoff Matrix. A market penetration strategy involves focusing on selling your existing products or services into your existing markets to gain a higher market share.

John Lewis use this strategy to sell more to current customers and to new customers who can be thought of as being in the same marketplace. For example, if your current customer base consists of women aged between 28 and 60 then this strategy would involve attempting to sell more of your existing products or services to this same group. John Lewis focus on doing this with their Home and Garden furniture and accessories by innovating their existing products in order to make them better for their customers. By doing this them could attract new customers to their products; this would mean that they also cover Market Development.

How John Lewis use Market Development

Market development is when the business seeks growth by targeting its existing products to new market segments.

A marketing manager has to think about the following questions before implementing a market development strategy: Is it profitable? Will it require the introduction of new or modified products? Is the customer and channel well enough researched and understood?

John Lewis uses four areas in market development for their products to give more focus to the market segment decision, these four areas are:

Existing customers
Competitors customers
Non-buying in current segments
New segments

How John Lewis use Product develpment

Product development is when the business aims to introduce new products into the existing markets. This strategy may require the development of new competencies and requires the business to develop modified products, which can appeal to existing markets.

Many business like John Lewis see a new product development as the first stage in generating and commercializing new products within the overall strategic process of the product life cycle management used to maintain or grow their market share.

What is a product life cycle?

It describes the stages a product goes through from when it was first thought of until it finally is removed from the market. Not all products reach this final stage. Some continues to grow and others rise and fall. The product life cycle diagram below shows that four stages exist in the ‘working life’ of most products. These are:

Introduction
Growth
Maturity
Decline

How John Lewis use Diversifcation

Diversification is when a business’ corporate strategy tries to enter into a new market or industry which the business is not currently in whilst also creating a new product for that new market. John Lewis hardly uses this sector due to them mostly opportating in the same products and services.

Monty the Penguin Campaign

The 'Monty the Penguin' christmas campaign won the hearts of million in starting November 2014. It contains continuity as its been and annual advert being produced whilst having simplicity as it isn't an advert that is bombarded with dazzling lights and actors. The advert being heart-warming also won point with viewers as it touched their hearts, lastly the advert integrated itself with social media which made it a largely spoken about online.

This campaign relates to the Ansoff Matrix, using the Monty the Penguin campaign they targeted market penetration with their outreach to a new clientele where they poached new customers as well as rebranded to their existing customers.

Their marketing campaign has developed their product by increasing their range, for example; selling new range of children's nightwear, as show in the advert as well as bringing a new range of products out as well as adding new features to current selling product to increase sales rate.

The advert has reached nearly 27 million views on Youtube.

Branding/Importance of Branding

Why is branding important?

Brand awareness is a common marketing objective as it is aimed to raise customers awareness of a company or product. Successful rise of brand awareness can raise sales and have clients constantly seeking out the brand.

Use of font/wording & images

The use of bold font stands out to the viewer as it is eye catching and would keep the audience interested and wanting to know more. The use of emotive language in a advert warms their customers heart and motivates them to give. The images and angles of photographs used helps us as viewers see things as we usually wouldn't.

What styles/themes do they use?

The theme used in the campaign was a 'christmas' theme. John Lewis' most important campaign of the year is their christmas campaign as it get so much publicity each year with their new and annually improved adverts. Their yearly campaign took a massive climb in 2014 with the 'Monty the Penguin' advert, which touched the hearts of over 26 million viewers on Youtube.

How does their branding influence buyer behavior?

A brand can be defined as the "relationship" with the customer. Relationships are built on experiences a customer encounters within a store or shopping experience. A business owner knows their own trademark, which helps them know their brand, but consumers will help define and develop your brand by buying the advertised products. Using imagery and having good marketers supporting and displaying a brand enhances it and gives your customers the encouragement they need to make the purchase.

Explain how your businesses encourage customers to be ‘brand loyal’

With the use of customer service companies find it easy to keep their customers brand loyal. Following this the customers are constantly kept satisfied. John Lewis keeps their customers happy with helping them in the stores or over the phone if they had problems, they would simply help them to the best of their abilities and this would want customers to only use their brand. Producing the best quality products in the store makes customers want to keep using John Lewis' products. Finally, having affordable prices on their product is a great factor that customers coming into the store consider. John Lewis also beats competitors prices by 10%, this shows customers that they would go out of the way to please customers and this keeps customers keen to spend their money at John Lewis.

Relationship/Transactional Marketing

Relationship Marketing

Relationship marketing is when a business puts there full focus of their marketing on their long-term valued customers. This means identifying their valuable customers and initiating and maintaining relationships with them. Customers built on relationship marketing are used to generate majority of the constant sector of a companies sustainable profit. For example, getting customers to sign up with their loyalty cards and the company can keep in touch with the customer to notify them of promotions etc.

Transactional Marketing

Transactional marketing is where a businesses marketing puts their full focus on their sales of an item or service with a smaller expectation of a relationship developing with their customers. A business would do this by giving discounts, lowering delivery cost and making products in more of a price range suitable for clients. For example, buying a product for its cheap prices rather than communicating with customers to make the sale. Their objective is also to completely raise sales.

What is the difference between the two and describe what type your business uses

and why.

Transactional marketing centres on just getting the customer to purchase a product, whilst relationship marketing sees the sale as the first step in building of a relationship. Transactional marketing’s goals are to enticing the customer for one off purchases mainly on price and short term benefits and product performance, with partial service. Relationship marketing is all about producing repeated sales and customer interactions, focusing on bringing value to the customer and promising long-term performance.

Relationship marketing also brings customers to the focus. This concept has implied the fact that a customer does not buy a product, but instead buys a resolution for a exact problem or need. By fulfilling this need, a company has contact to many other chances that the customer will have at some point. If the company can build a relationship with the customer, they would find out who he is, what their needs are, this also creates a lifetime valued customer. Transactional marketing puts their reliability on price, short term benefits and product performance, while having restricted service.

Relationship marketing is focused on creation, maintenance and satisfaction of the customers. It focuses its importance and is diverted on building and maintaining long term relationship with customers, then attracting new ones every time. It contraries the emphasis in the past of creating customers and paying no attention to retaining them. The Transactional marketing is also known as traditional marketing. This employs the pull technique, producing the product with quality as key concern, and satisfying the customer needs and wants without structure any connection with them. The transactional marketing focuses on enlarging the profit of the company by employing more customers to purchase the businesses product.

John Lewis' marketing focuses mainly on relationship marketing because they are constantly emphasising on how much as a business they value customer service. They have made customer service lines available 24 hours to anyone that needs help and hire the best of the best employees and train them to the best of their ability to serve customers.

What are the benefits of ‘lifetime value of a customer’

"A lot has been talked about Customer Life Time Value in recent times. Though there has been a debate about whether it is a useful tool to adopt in the course of business to enable revenue growth, there have been organizations who have started realizing the importance of calculating the life time value. In a situation where companies need to stay ahead of competition, with technology there is always a better solution out there - there always is and there will be a new approach, a new disruption, a new business story – and customer life time value aids in such an effort.

The most significant part of Customer life time value is that it is not at all for any specific industry and rather spans across all industries. It is just a matter that the level of engagement and advantage might differ based on the business model in place. Though there can be a lot of assumptions which are accounted for in the process of calculating the life time value, ultimately organizations need to remember that at the end of the day, it is just a tool and not a strategy to enable better revenue growth opportunities."

Information receieved from- http://www.brillio.com/insights/post/business-benefits-customer-lifetime-value-process-ensure-success