MARKETING OF SERVICES
ASSIGNMENT
SUBMITTED TO SUBMITTED BY
Prof. Shweta Nanda Himanshu Mourya
IGSM/PG20180856
Answer 1.
The corporate culture at Argos and build an environment within the firm that values to fulfil
customer needs:
customer service which focuses providing an experience that is enjoyable and friendly
as well as efficient
teamwork, because this leads to greater co-operation and the sharing of best practice
taking ownership for decisions so that managers solve problems themselves rather
than pass them on to others
respecting each other so that everyone feels they can contribute
Having the competitive will to win so that everyone is aiming to improve and to
succeed.
Values such as these have played a vital part in improving the firm's competitiveness
through innovation and through working effectively together.
To achieve such a cultural change, Argos provides on the job and off the job training,
career development opportunities and appropriate rewards for good performance. For
example, new employees take intranet-based training tests on key areas such as
customer service and shopping at Argos and every employee's progress is tracked
through the different training modules.
The Marketing mix at Argo
The product
The company has also widened its product range; by 2002 it offered twice as many products
than four years earlier. In 2002 alone it added an extra 2,400 product lines, taking the total to
nearly 12,000. In particular, Argos has moved further into furniture and white goods such as
fridges as well as services such as pet insurance.
Given that the brand is so well known and that over 70% of the population shop at Argos, the
company's management thinks the best strategy to boost revenue is to convince existing
customers to buy more rather than work specifically at attracting new customers. It aims to do
this, in part, through offering a wider choice.
Promotion
The company has used advertising to appeal to its different market segments. Argos segments
its market not just in terms of the traditional demographics (e.g. age and gender) but also in
terms of people's brand awareness. Argos divides its customers into 'the don't get its' (who
use Argos only occasionally) and 'the get its' (who regularly shop at Argos). The latest
advertising campaign has two characters - an ageing rock star (a 'don't get it') and his personal
assistant (a 'get it'). In the course of a series of adverts, the 'get it' gradually introduces the
'don't get it' to the wide range of Argos products and solves all his purchasing problems.
The campaign is designed to promote a more modern image for the business, to attract the
'don't get its' to spend more and to reinforce the loyalty of the 'get its'. In 2003 the television
adverts won Retail Week's Marketing Campaign of the Year award and the 'Retail' category
in the Marketing Week Effectiveness Awards 2003.
Place
Argos continues to revamp existing and open new stores, making its products more accessible
to customers throughout the UK. Between 2002 and 2003 the company opened a further 36
outlets; its long run target is to have around 600 stores. Its catalogue is a key part of the
Argos distribution system and can be found in 70% of British households.
Price
Argos's pricing strategy focuses on providing low prices. The management team has
strengthened this approach e.g. with low price DVDs and CDs. The company works closely
with suppliers to keep costs, and therefore prices, as low as possible.
People
Argos places great emphasis on training staff and ensuring they provide a good customer
service. If staff are friendly, know what they are talking about and are eager to serve their
customers this can provide an important competitive advantage in retailing.
Process
In 2002 Argos introduced 'Text and Take Home' which allows potential buyers to text at any
time to discover if a product is available in their local store and, if they wish, reserve it to
pick up later. The company expects 700,000 users per year for this service. Over 40 million
text messages are sent in the UK every day so the potential is huge and Argos is tapping into
this growth area. Alongside the Argos website and telephone service, 'Text and Take Home'
is designed to make buying from the company more convenient.
Argos has also improved the in-store buying experience by introducing 'Quick Pay'- a system
that enables customers in store to check availability, order and pay for goods themselves by
credit or debit card, thereby avoiding the tills. This service makes shopping easier for
customers and reduces the queues in-store in the busy periods; it currently accounts for 6% of
all Argos sales.
Given the growth of Internet shopping, where customers can buy direct at any time of the day
or night, Argos has responded by being technologically innovative to ensure the process of
buying its products is as easy as possible. The success of these developments has been
recognised with many top awards.
Physical environment
In retailing, the look and layout of stores can be an important factor for attracting customers.
Argos has invested heavily in store improvements to ensure customers are attracted by their
shops and walk in. Between 2002 and 2003 Argos refurbished over 100 of its stores.
Answer 2.
There is a significant amount of customers who buy infrequently from Argos. Argos
classifies this group as the 'Don't quite get its'. Advertising on television and through other
media is an important way of attracting this audience. Through advertising the 'Don't quite
get its' are able to appreciate the range that Argos offers, and the value for money of the offer.
For example, at Christmas time Argos adverts illustrate the way that a shopper can buy all of
their presents through the Argos catalogue. In comparison large numbers of people regularly
shop at Argos - these are the 'Get its'. Argos' approach with this segment of the market is to
increase the amount they spend in every purchase. Argos has introduced an ever-expanding
product range especially since its Home Delivery Service was introduced. Argos has focused
on convenience for customers. Research showed that customers regard speed to be the top
criterion when choosing to shop from Argos. Many customers like to browse the Argos
catalogue in the comfort of their own home. A large proportion of orders are still made in
store, but an increasing proportion are being made online and by telephone. There are a
number of channels for receiving goods including collection from the store and using the
home delivery service. In line with the development of new technologies and market
research. Argos has also introduced new innovations such as text and take home and Quick
Pay kiosks. Argos' unique shopping experience is popular and successful because it is
focused around meeting customer needs. Argos has gained competitive advantage over rivals
by differentiating itself on the basis of providing the best value for money for customers
through the most convenient shopping experience.
