Organisational Overview
Pet World is a medium sized pet store in a busy suburban retail area. Located in an upper-middle class suburb of Paddington, Brisbane; the store location has excellent exposure to pedestrian traffic and the area has plenty of parking available for customers. The business has been operating for 5 years in the same location and has established a good reputation with the local and surrounding suburbs. There are no other retail pet stores in the retail strip; however, there are 3 other pet stores within a 10 km radius, two of which have been operating for longer than 5 years.
Market Overview
Pet World specialises in providing popular breeds of dogs and cats, from purebred to designer breeds. The target market is currently pet owners that live in a 10km radius of the store. There is a large selection of pet food, healthcare products, and a good range of boutique accessories. The largest market segment for Pet World is in pet food sales; with 55% of revenue per year generated from pet food products. Pet World have been able to develop as a market leader in the segment due to a wide range of pet food products available for many stages of a dog’s life, and a variety of cost effective to organic style products. There are no direct competitors in the local area that can compare to the variety they supply; this benefit combined with a loyalty card program, has assisted and continues to maintain a loyal customer base. Sales revenue from healthcare and accessories generates 30% of the businesses revenue per year; this has steadily grown in the last three years as more healthcare products are developed by suppliers. Live sales of dogs and cat generates 15% of the remaining revenue per year with cats making up 40% and dogs making up 60% of this revenue.
Marketing Objectives
Pet World is ready to consider ideas for expanding the business from their current location. The store wants to seek new marketing opportunities to realise the following goals:
1. Increase sales by 10% in the next 12 months
2. Penetrate a new market segment
3. Broaden its product mix
The store is a medium size retail space; the layout has opportunity for improvement to provide additional space for the addition of a new product or service. Research has been completed and two viable opportunities have been identified that could use the space and realise the marketing objectives:
a) Introduce a new market segment of pets i.e. birds, fish or reptiles
b) Offer a Clipping / Grooming service to existing customers
Based on the current market Pet World is operating in, the clipping and grooming service provides an immediate opportunity to offer a new product in an existing market. Pet World will penetrate a new market segment in an accessible market by marketing to their existing base of loyalty card customers. The clipping and grooming segment provides a broad range of products and services for customers, a recent study by the Animal Health Alliance estimated pet clipping a grooming to be worth $305 million per year. The average spend per household in Australia is $100 per year. Similar to consumable products; this market segment offers sustainability through frequent repeat business.
Pet World has a loyalty card customer base