1.

Industry Profile

Indian Retailing:

Retailing in India is one of the pillars of its economy and accounts for about 15% of its GDP.
The Indian retail market is estimated to be US$ 450 billion and one of the top five retail markets
in the world by economic value. India is one of the fastest growing retail markets in the world,
with 1.2 billion people.

India's retailing industry is essentially owner manned small shops. In 2010, larger format
convenience stores and supermarkets accounted for about 4 percent of the industry, and these
were present only in large urban centers. India's retail and logistics industry employs about 40
million Indians (3.3% of Indian population).

Until 2011, Indian central government denied foreign direct investment (FDI) in multi-brand
retail, forbidding foreign groups from any ownership in supermarkets, convenience stores or any
retail outlets. Even single-brand retail was limited to 51% ownership and a bureaucratic process.

In November 2011, India's central government announced retail reforms for both multi-brand
stores and single-brand stores. These market reforms paved the way for retail innovation and
competition with multi-brand retailers such as Walmart, Carrefour and Tesco, as well single
brand majors such as IKEA, Nike, and Apple The announcement sparked intense activism, both
in opposition and in support of the reforms. In December 2011, under pressure from the
opposition, Indian government placed the retail reforms on hold till it reaches a consensus.

In January 2012, India approved reforms for single-brand stores welcoming anyone in the world
to innovate in Indian retail market with 100% ownership. Indian government continues the hold
on retail reforms for multi-brand stores.

Organized retailing, in India, refers to trading activities undertaken by licensed retailers, that is,
those who are registered for sales tax, income tax, etc. These include the publicly-
traded supermarkets, corporate-backed hypermarkets and retail chains, and also the privately
owned large retail businesses.

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Unorganized retailing, on the other hand, refers to the traditional formats of low-cost retailing,
for example, the local mom and pop store, owner manned general stores, paan/beedi shops,
convenience stores, hand cart and pavement vendors, etc.

Organized retailing was absent in most rural and small towns of India in 2010. Supermarkets and
similar organized retail accounted for just 4% of the market.

Background of Indian retailing:

Most Indian shopping takes place in open markets or millions of small, independent grocery and
retail shops. Shoppers typically stand outside the retail shop, ask for what they want, and cannot
pick or examine a product from the shelf. Access to the shelf or product storage area is limited.
Once the shopper requests the food staple or household product they are looking for, the
shopkeeper goes to the container or shelf or to the back of the store, brings it out and offers it for
sale to the shopper. Often the shopkeeper may substitute the product, claiming that it is similar or
equivalent to the product the consumer is asking for. The product typically has no price label in
these small retail shops; although some products do have a manufactured suggested retail price
(MSRP) pre-printed on the packaging. The shopkeeper prices the food staple and household
products arbitrarily, and two consumers may pay different prices for the same product on the
same day. Price is sometimes negotiated between the shopper and shopkeeper. The shoppers do
not have time to examine the product label, and do not have a choice to make an informed
decision between competitive products.

India's retail and logistics industry, organized and unorganized in combination, employs about 40
million Indians (3.3% of Indian population). The typical Indian retail shops are very small. Over
14 million outlets operate in the country and only 4% of them being larger than 500 sq ft (46 m 2)
in size. India has about 11 shop outlets for every 1000 people. Vast majority of the unorganized
retail shops in India employ family members, do not have the scale to procure or transport
products at high volume wholesale level, have limited to no quality control or fake-versus-
authentic product screening technology and have no training on safe and hygienic storage,
packaging or logistics. The unorganized retail shops source their products from a chain of
middlemen who mark up the product as it moves from farmer or producer to the consumer. The
unorganized retail shops typically offer no after-sales support or service. Finally, most
transactions at unorganized retail shops are done with cash, with all sales being final.

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Until the 1990s, regulations prevented innovation and entrepreneurship in Indian retailing. Some
retails faced complying with over thirty regulations such as "signboard licences" and "anti-
hoarding measures" before they could open doors. There are taxes for moving goods to states,
from states, and even within states in some cases. Farmers and producers had to go through
middlemen monopolies. The logistics and infrastructure was very poor, with losses exceeding 30
percent.

Through the 1990s, India introduced widespread free market reforms, including some related to
retail. Between 2000 to 2010, consumers in select Indian cities have gradually begun to
experience the quality, choice, convenience and benefits of organized retail industry.

Growth of Indian retailing:

Growth over 1997-2010

India in 1997 allowed foreign direct investment (FDI) in cash and carry wholesale. Then, it
required government approval. The approval requirement was relaxed, and automatic permission
was granted in 2006. Between 2000 to 2010, Indian retail attracted about $1.8 billion in foreign
direct investment, representing a very small 1.5% of total investment flow into India.

Single brand retailing attracted 94 proposals between 2006 and 2010, of which 57 were approved
and implemented. For a country of 1.2 billion people, this is a very small number. Some claim
one of the primary restraints inhibiting better participation was that India required single brand
retailers to limit their ownership in Indian outlets to 51%. China in contrast allows 100%
ownership by foreign companies in both single brand and multi-brand retail presence.

Indian retail has experienced limited growth, and its spoilage of food harvest is amongst the
highest in the world, because of very limited integrated cold-chain and other infrastructure. India
has only 5386 stand-alone cold storages, having a total capacity of 23.6 million metric tons.
However, 80 percent of this storage is used only for potatoes. The remaining infrastructure
capacity is less than 1% of the annual farm output of India, and grossly inadequate during peak
harvest seasons. This leads to about 30% losses in certain perishable agricultural output in India,
on average, every year.

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Indian laws already allow foreign direct investment in cold-chain infrastructure to the extent of
100 percent. There has been no interest in foreign direct investment in cold storage infrastructure
build out. Experts claim that cold storage infrastructure will become economically viable only
when there is strong and contractually-binding demand from organized retail. The risk of cold
storing perishable food, without an assured way to move and sell it, puts the economic viability
of expensive cold storage in doubt. In the absence of organized retail competition and with a ban
on foreign direct investment in multi-brand retailers, foreign direct investments are unlikely to
begin in cold storage and farm logistics infrastructure.

Until 2010, intermediaries and middlemen in India have dominated the value chain. Due to a
number of intermediaries involved in the traditional Indian retail chain, norms are flouted and
pricing lacks transparency. Small Indian farmers realize only 1/3rd of the total price paid by the
final Indian consumer, as against 2/3rd by farmers in nations with a higher share of organized
retail. The 60%+ margins for middlemen and traditional retail shops have limited growth and
prevented innovation in Indian retail industry.

Growth after 2011

Before 2011, India had prevented innovation and organized competition in its consumer retail
industry. Several studies claim that the lack of infrastructure and competitive retail industry is a
key cause of India's persistently high inflation. Furthermore, because of unorganized retail, in a
nation where malnutrition remains a serious problem, food waste is rife. Well over 30% of food
staples and perishable goods produced in India spoil because poor infrastructure and small retail
outlets prevent hygienic storage and movement of the goods from the farmer to the consumer.

One report estimates the 2011 Indian retail market as generating sales of about $470 billion a
year, of which a miniscule $27 billion comes from organized retail such as supermarkets, chain
stores with centralized operations and shops in malls. The opening of retail industry to free
market competition, some claim will enable rapid growth in retail sector of Indian economy.
Others believe the growth of Indian retail industry will take time, with organized retail possibly
needing a decade to grow to a 25% share. A 25% market share, given the expected growth of
Indian retail industry through 2021, is estimated to be over $250 billion a year: a revenue equal
to the 2009 revenue share from Japan for the world's 250 largest retailers.

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The Economist forecasts that Indian retail will nearly double in economic value, expanding by
about $400 billion by 2020. The projected increase alone is equivalent to the current retail
market size of France.

The Indian Retail Market:

Indian market has high complexities in terms of a wide geographic spread and distinct consumer
preferences varying by each region necessitating a need for localization even within the
geographic zones. India has highest number of outlets per person (7 per thousand) Indian retail
space per capita at 2 sq ft (0.1 9 m2)/ person is lowest in the world Indian retail density of 6
percent is highest in the world. 1.8 million households in India have an annual income of over
45 lakh (US$85,500).

Delving further into consumer buying habits, purchase decisions can be separated into two
categories: status-oriented and indulgence-oriented. CTVs/LCDs, refrigerators, washing
machines, dishwashers, micro wave ovens and DVD players fall in the status category.
Indulgence-oriented products include plasma TVs, state-of-the-art home theatre systems, iPods,
high-end digital cameras, camcorders, and gaming consoles. Consumers in the status category
buy because they need to maintain a position in their social group. Indulgenc e-oriented buying
happens with those who want to enjoy life better with products that meet their requirements.
When it comes to the festival shopping season, it is primarily the status-oriented segment that
contributes largely to the retailer’s cash register.

While India presents a large market opportunity given the number and increasing purchasing
power of consumers, there are significant challenges as well given that over 90% of trade is
conducted through independent local stores. Challenges include: Geographically dispersed
population, small ticket sizes, complex distribution network, and little use of IT systems,
limitations of mass media and existence of counterfeit goods.

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Major Indian Retailers:

 REI AGRO LTD Retail: 6TEN and 6TEN kirana stores

 Future Groups-Formats: Big Bazaar, Food Bazaar, Pantaloons, Central, Fashion Station,
Brand Factory, Depot, aLL, E-Zone etc.
 Raymond Ltd.: Textiles, The Raymond Shop, Park Avenue, Park Avenue Woman, Parx,
Colourplus, Neck Ties & More, Shirts & More etc.
 Fabindia: Textiles, Home furnishings, handloom apparel, jewellery
 RP-Sanjiv Goenka Group Retail-Formats: Spencer’s Hyper, Spencer's Daily, Music World,
Au Bon Pain (Internaional bakery cafeteria), Beverly Hills Polo Club
 The Tata Group-Formats: Westside, Star India Bazaar, Steeljunction, Landmark, Titan
Industries with World of Titans showrooms, Tanishq outlets, Croma.
 Reliance Retail-Formats: Reliance MART, Reliance SUPER, Reliance FRESH, Reliance
Footprint, Reliance Living, Reliance Digital, Reliance Jewellery, Reliance Trends, Reliance
Autozone, iStore
 Reliance ADAG Retail-Format: Reliance World
 K Raheja Corp Group-Formats: Shoppers Stop, Crossword, Hyper City, Inorbit Mall
 Nilgiri’s-Formats: Nilgiris’ supermarket chain
 Marks & Spencer: Clothing, lifestyle products, etc.
 Lifestyle International-Lifestyle, Home Centre, Max, Fun City and International Franchise
brand stores.
 Pyramid Retail-Formats: Pyramid Megastore, TruMart
 Next retail India Ltd (Consumer Electronics)(www.next.co.in)
 Vivek Limited Retail Formats: Viveks, Jainsons, Viveks Service Centre, Viveks Safe
Deposit Lockers
 PGC Retail -T-Mart India [1], Switcher, Respect India, Grand India Bazaar,etc.,
 Subhiksha-Formats: Subhiksha supermarket pharmacy and telecom discount chain.
 Trinethra- Formats: Fabmall supermarket chain and Fabcity hypermarket chain
 Vishal Retail Group-Formats: Vishal Mega Mart
 BPCL-Formats: In & Out

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 German Metro Cash & Carry
 Shoprite Holdings-Formats: Shoprite Hyper
 Paritala stores bazar: honey shine stores
 Aditya Birla Group - "More" Outlets
 Kapas- Cotton garment outlets
 Nmart Retails with 71 operating Stores till now and total 153 Stores in India and 1 to open in
Dubai Shortly. (Expected to be 150 by the end of Aug-2012)

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 2. Company Profile

Background and inception of the company:

About Reliance Group

The Reliance Group, founded by Dhirubhai H. Ambani (1932-2002), is India's largest private
sector enterprise, with businesses in the energy and materials value chain. Group's annual
revenues are in excess of US$ 58 billion. The flagship company, Reliance Industries Limited, is
a Fortune Global 500 company and is the largest private sector company in India.

Dhirajlal Hirachand Ambani (1932-2002)

Founder of Reliance Group

Backward vertical integration has been the cornerstone of the evolution and growth of Reliance.
Starting with textiles in the late seventies, Reliance pursued a strategy of backward vertical
integration - in polyester, fibre intermediates, plastics, petrochemicals, petroleum refining and oil
and gas exploration and production - to be fully integrated along the materials and energy value
chain.

The Group's activities span exploration and production of oil and gas, petroleum refining and
marketing, petrochemicals (polyester, fibre intermediates, plastics and chemicals), textiles, retail,
infotel and special economic zones.

Reliance enjoys global leadership in its businesses, being the largest polyester yarn and fibre
producer in the world and among the top five to ten producers in the world in major
petrochemical products.

Major Group Companies are Reliance Industries Limited, including its subsidiaries and Reliance
Industrial Infrastructure Limited.

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About Reliance Retail Limited

Reliance Retail Limited is an organized retail arm of the Reliance Industries Limited. Reliance
industry is the largest conglomerate in India. It has an annual turnover of US$35.9 Billion. It is
also listed on 206th position in the Fortune Global 500 companies.

Reliance Retail is actually the retail group of Reliance Industries Limited. It has a number of
brands like Reliance Time Out, Reliance Digital, Reliance Wellness, Reliance Autozone,
Reliance Super, Reliance Mart, Reliance iStore, Reliance fresh, Reliance footprint, Reliance
Jewels, Reliance trends, and Reliance living.

Reliance Group was established in 1970's. The Reliance Retail was found in the year 2006 as an
operating subsidiary. It has its head office in Mumbai, India.

Reliance is gearing up to revolutionize the retailing industry in India. Towards this end, Reliance
is aggressively working on introducing a pan-India network of retail outlets in multiple formats.

A world class shopping environment, state of art technology, a seamless supply chain
infrastructure, a host of unique value-added services and above all, unmatched customer
experience, is what this initiative is all about.

The retail initiative of Reliance will be without a parallel in size and spread and make India
proud. Ensuring better returns to Indian farmers and manufacturers and greater value for the
Indian consumer, both in quality and quantity, will be an integral feature of this project. By
creating value at all levels, we will actively endeavor to contribute to India's growth.

The project will boast of a seamless supply chain infrastructure, unprecedented even by world
standards. Through multiple formats and a wide range of categories, Reliance is aiming to touch
almost every Indian customer and supplier.

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About Reliance Digital
Reliance Digital is a Consumer Electronics, Durables, IT & Telecom retail arm of Reliance
Retail Group, a subsidiary of Reliance Industries Limited hosts over 150 national and
international brands of electronic products. Reliance Digital Stores offer more than 4000 types of
electronic products.

After a successful launch of Reliance Fresh stores across several towns and cities in India,
Reliance Retail Limited unveiled ‘Reliance Digital’ in the year 2007, its pilot consumer
electronics concept mega store. The new destination for the latest in technology and
entertainment products & services, and currently 58 Reliance Digital stores are operating in
India.

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 Nature of the business carried:

Reliance Digital Store is a one stop shop for different electronic needs of all customers. May it
be household appliances, computers, laptops, games or telecom products; customers can find
every gadget, for every budget at Reliance Digital. It has over 4000 products at reasonable prices
for its valued customers.

Vision, Purpose, Values and Promises:

Vision
Reliance Digital seeks to fulfill the dream of every Indian, be it through its nationwide network
of conveniently located stores or through its presence on the web, by providing a delightful
shopping experience of products & solutions and helping them bring home the latest & best in
technology from the widest selection at the lowest assured price with complete peace of mind
through lifelong support.

Or more simply
“We bring Technology to life for you”

Purpose
 Growth is Life

“Bettering the lives of Indian everyday”

Values

 We believe in people

 We believe in and follow the customer

 We believe in the good of the community

 We believe in each other

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Promises

 A delightful shopping experience

 A delighted community

 A delightful place to work

Products/ Services Profile:

Reliance Digital – The Merchandise Mix

Complete range of
 Consumer electronics
 Home appliances
 Kitchen appliances
 Computing & gaming
 Personal audio
 Mobile communications
 High-end audio & home theaters
 High definition flat panel televisions
 Music and movies
 Digital photography & photo printing
 Accessories to enhance product usage & experience
 And lots more!
More than 150 brands, 4000 products and countless solution bundles individually
recommended to best suit the customers’ needs.

Services

Reliance Digital reviews all its products to provide the best to its customers. It has a specially
designed ‘Experience Zones’ to get the real feel of the product before purchasing it.

Reliance Digital provides financial assistance through easy EMI Schemes; Company has
appointed Bajaj Capital to provide financial assistance to its consumers. Consumers have to
make 40% down payment and the remaining amount is distributed into 8 EMIs and interest rate
varies from brand to brand products.

Reliance Digital has a ResQ facility, which serves the purpose of a technical support team. It
comes to rescue to provide solutions for problems that customers may face with products from

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all leading brands. This facility is available 7 days a week; 365 days a year from 10 a.m. to 10
They have qualified engineers to deal with installation and to guide you with the usage of
the appliances.

ResQ services are -

Product installation: ResQ help to set up customers’ product for optimum

performance

Specialised customer training:

 Specialised training to customers on products and related applications by an industry

trained personnel

Authorised Service Station for diagnosis and repairs (Caters to all brands)

 One stop solution for repairs for all brands’ products

 Repairs covering both pre and post manufacturer warranty periods
 On-site service for select products – for the rest, our engineers shall transport products to
and fro from the service station

Demonstrate Product Usage:

 Live demonstration of all features of the product

 Provide handy care tips

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 Health check-up plan: Preventive Maintenance

 To ensure that products do not malfunction, resQ offer periodic services and
maintenance check-ups
 Tips on upkeep of products for optimal performance
 Also covers products not purchased from Reliance Digital

Enhanced Utility: ResQ Accessories

 ResQ offer a host of utility products and accessories that are compatible with products &
help customers get more of them!

Extended Warranty Service- ResQ Care Plan

 Free repairs, including both parts and labour

 Free preventive maintenance visits during plan period

Area of operation – National:

Reliance Digital is a Consumer Electronics, Durables, IT & Telecom retail arm of

Reliance Retail Group, a subsidiary of Reliance Industries Limited, and currently 58
Reliance Digital stores are operating in India and 9 stores are operating in Bangalore.

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 Ownership pattern:

Reliance Industries Limited

Refining Textiles Retail Petrochemicals - Petrochemicals

Polyester & - Polymers
Fibre
Intermediates
Reliance Vimal Reliance Digital
Gas & Vimal Gifting Reliance fresh Repol
Reliance & Reliance footprint Relene
Aviation V2 Vimal Reliance Jewels Reon
Reliance trends Recron Stretch Cisamer
Reliance Recron Cotluk &
Petroleum Retail Recron Dyefast
Relab
Roxy Recron 3s
Office Depot Recron LP
GAPCO Relpet
And many more And many
more

Reliance industry is the largest conglomerate in India, having number of brands with the
different businesses. The ownership pattern of Reliance Digital can be explained as - Reliance
Industries Limited has different subsidies; Reliance Retail Limited is one among the subsidies
and under which Reliance Digital is one of the Retail Business of Reliance retail.
Reliance Digital or the Reliance Retail Limited has not listed in stock market individually but
Reliance Industries Limited (RIL) as whole listed under stock market where all the subsidies of
RIL is considered to be a group and listed in the stock market. Hence Reliance Digital is a Public
Limited Company and Mr. Mukesh D. Ambani is the Chairman and Managing Director of
Reliance Industries Limited.

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 Competitors Information:

Croma
Croma is India’s first national, large format, specialist retail chain for consumer electronics and
durables.
Croma is promoted by Infiniti Retail Ltd, a 100% subsidiary of Tata Sons. Woolworths, one of
the world’s leading retailers, provides technical and strategic sourcing support, ensuring that you
buy nothing but the best.
Croma's first store opened on October 9, 2006 at Juhu in Mumbai, and it's rolling out many more
stores across India.

Brand Philosophy
 If service wasn't important.
 If technology wasn't complex.
 If variety wasn't confusing.
 We would have no reason to be in business.
 We help you buy.

eZone
eZone is an experience-led lifestyle format that brings together the best in national and
international consumer electronic and durables brands in a family-centric environment. Typically
covering 12,000 square feet, an eZone store truly enables you to experience electronics through
three dedicated zones - Liberation Zone, Experience Zone and Home Zone.
The Liberation Zone offers personal products like computers, laptops, handy cams, MP 3 players
and mobile phones. Entertainment products such as Plasma / LCD, Flat TVs, Home Theatre
systems, DVD players, and Stereo systems are displayed in the Experience Zone. In the Home
Zone segment, one gets to pick electronic goods of his or her choice including Refrigerators, Air-
Conditioners, Washing Machines and Microwave ovens among other kitchen-related appliances.
eZone also offers an unparalleled service and support through the special ‘E-Care’ customer
support centre. E-Care is a special, dedicated support system designed to offer the best customer
service after purchase of any product at eZone.

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Others
There are other unorganized consumers electronic and durables brands such as Pai International,
Girias and Harsha Electronics are operating in Karnataka and some other states of the country
and these can be called as local market competitors but these brands are not to be considered as
competitors for Reliance Digital Retail Limited.

Infrastructural facilities:
Planogram
Also known as plano-gram, plan-o-gram, and POG, planogram is a visual representation of a
store's products or services considered as a tool of visual merchandising in retail store.

Signage
Signage is kind of visual graphics created to display information about products to customers.

Experience Zones
Experience zones take consumers through a delightful and interactive voyage in the world of
electronics and durable goods. Crafted with the latest signage, audio and merchandising where
customers can experience the products before purchasing.

Home theater experience zone

It is an exclusive experience zone in reliance digital store. It is a small room arranged well
furnished with sound systems where consumers can experience the home theaters before
purchasing.

Play station
Play station is advanced video gaming station where customers who visit the store can play and
have delightful shopping experience with reliance digital.

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Learning Center
Learning center is training center that is located within the reliance digital store where employees
are trained on the products thos e arrived in the store and usually this center is sed
u for meetings
in the store.

Work flow model:

The nature of the business is r etailing hence the manufacturing of goods is not involved with
reliance digital instead goods are ordered and brought into stores for the retail sales. The
numbers of products from the different brands with different product ranges are recruited into
stores and further sales is made so the work flow model could be Operating Model and Stock
Ordering Process.

Operating Model

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Operating Model Explanation
1. The operating model begins with Pre – installation Counseling & queries of customers
basically this happens though telephonic queries by customers or approach to know about
product available in reliance digital and this step will supported by resQ team. Usually
this will not be the initial step in most of the cases, customers directly approach store to
know about the products.
2. The second step could begin the actual operating model because most of the customers
first approach store and get to know details about their required product, when customers
walk in to the store employees counsel the customers, attend their queries and also
understanding their requirements they provide consultative solution to customers and this
can be considered as beginning step of operating model.
3. After counseling and consultation when customer make the purchase of goods, delivery
of goods will be supported by Reliance D&L Team, team also help customer in exchange
and product pick-up in case of any replacements after sale of goods as post sales service.
4. When goods are delivered to customers by D&L team, reliance resQ team helps
customers by Demonstration and Installation of product at customers place.
5. And after sales services such as extended warranty/maintenance and repairs will be
supported by resQ team in the company.
6. And also replacement and up gradation of products will be supported by resQ team and
further queries regarding products etc will handled by resQ team, with this again
operating model may continues as discussed above.

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Stock Ordering Process

Reliance Digital has classified electronics and consumer durable goods into four departments as
1. Consumer Electronics
2. Home Appliances
3. Information Technology
4. Telecommunication

When the goods in the departments need to be ordered; each department follow the following
procedure for ordering the stock.

Stock Ordering Process

Stock Ordering Process Explanation

1. Stock report of every product is verified regularly by all the departments.
2. In case there is no stock or less quantity in the stock for the products, st ock ordering mail
has to be sent to the category
g department of respective section requestin g the list of goods
required in the department with the complete details such as Product, Brand Name,
Article code and Quantity, and ordering mail should have store code.
3. Category department is a central body present in the Mumbai corporat e office, category
department place the order to respective Brands to deliver the goods to central ware
house of the state.

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 4. Brand people deliver ordered goods to respective central ware house, central ware house
become the distribution center for the stores.
5. Distribution center sends the goods to the stores those are ordered.
6. When the goods arrive to the store goods are received by material department of store.
7. And finally goods are sent to the respective departments.
8. Each department has to update its stock report every day for the stock reference and keep
follow up on stock level.

Future Growth and Prospectus:

At a time when inflation and high input costs are putting pressure on margins of retail
companies, Mukesh Ambani-led Reliance Retail expects its specialty and value formats driving
the firm’s next stage of growth.
Reliance Retail’s value formats include Reliance Fresh, a neighborhood retail concept, Reliance
Mart, an all-under-one-roof supermarket concept, and Reliance Super, a mini-mart concept. The
value formats offer a wide range and assortment of products required for daily household needs.
Its specialty formats include Reliance Digital, consumer durables and information technology
concept, Reliance Trends, apparel and accessories concept, and iStore by Reliance Digital, an
exclusive Apple products stores. Other specialty formats include Reliance Footprint for
footwear, Reliance Jewels, and Reliance Living, a home wear, furniture, modular kitchens and
furnishings concept. Reliance Retail plans to double its stores across all formats within next five
years. At present, it has more than 1,050 stores and a pan-India presence.
Reliance Digital Retail Limited will have 100 stores by the year 2014 in pan India. And also
company planning to provide financial assistance to the reliance digital customers by the reliance
group as of now it has appointed Bajaj Capital for the financial assistance to Reliance Digital
customers.

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 3. The McKensy’s 7S Framework

The McKinsey 7S model

The McKinsey 7S model was named after a consulting company, McKinsey and Company,
which has conducted applied research in business and industry. The McKinsey 7S Framework
was created as a recognizable and easily remembered model in business. The seven variables,
which the authors term "levers", all begin with the letter "S":
These seven variables include structure, strategy, systems, skills, style, staff and shared values.
Structure is defined as the skeleton of the organization or the organizational chart. The authors
describe strategy as the plan or course of action in allocating resources to achieve identified
goals over time. The systems are the routine processes and procedures followed within the
organization. Staff are described in terms of personnel categories within the organization (e.g.
engineers), whereas the skills variable refers to the capabilities of the staff within the
organization as a whole. The way in which key managers behave in achieving organizational
goals is considered to be the style variable; this variable is thought to encompass the cultural
style of the organization. The shared values variable, originally termed super ordinate goals,
refers to the significant meanings or guiding concepts that organizational members share.

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From above 7, three are called Hard ‘S these are such as
 Strategy
 System
 Structure

And other four are called Soft ‘S’, namely

 Skills
 Staff
 Shared value
 Style

McKinsey’s 7s at Reliance Digital

Strategy
Strategy is the plan of action an organization prepares in response to, or anticipation of, changes
in its external environment. Strategy is differentiated by tactics or operational actions by its
nature of being premeditated, well thought through and often practically rehearsed.

Reliance Digital routinely have different campaigning strategies for their new products and to
move stock which offer exciting sales promotion offers for the customers to persuade them to
know the product and purchase it. For e.g. During Christmas and New Year sale they had up to
50% discount on products.
Reliance Digital uses display fixtures to communicate and educate customer about the sales
promotion and they decorate the window areas with the products related to their promotion.

System
The system that Reliance Digital has for its sale of goods is friendlier and assists customer in
purchase of products. The procedure that they follow in Reliance Digital for sale of product is
initially when customers walk in to store junior sales associate welcome customer in to store by
greeting them and ask them how he can assist them, when customer ask him about his required
product junior sales associate takes customer to that particular department and leaves customer to
Senior sales associate or Team leader to attend the customers, here the person attend customer
queries and explain about product features and benefits. And also consult them to go for

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particular product. When customer makes purchasing decision the same person takes customer to
cash counter to make bill of the purchased product and when customer reaches cash counter
cashier at counter greet the customer and makes billing and keep the product in Reliance Digital
carry bag and hand over to customer in case goods are heavy to carry there are store boys who
help customer taking them out of store and keep the products in their vehicle and if the products
are huge in size they make delivery arrangement through D&L Team.

Structure
The design of organizational structure is a critical task of the top management of an organization.
It is the skeleton of the whole organization. It prescribes the formal relationship among various
positions and activities.
Organisation Structure

24
 Store Hierarchy

CMO – Commercial Operations Manager

VM – Visual Merchandiser
DM – Department Manager
CE – Consumer Electronics
Telecom – Telecommunication
HA – Home Appliances
IT – Information Technology
TL – Team Leader
SSA – Senior Sales Associate
JSA – Junior Sales Associate
MOO – Material Operational Officer
MOE – Material Operational Executive
CRM – Customer Relationship Manager
SHE – Senior Helpdesk Executive
JHE – Junior Helpdesk Executive

25
Skills
Employees must have products knowledge and they should have skills to persuade customer to
purchase product. At Reliance Digital Company provide training to the employees on products
which help employees to make sale of product with their best knowledge of product and skill. In
successive intervals the company sends mystery shoppers to stores to evaluate the performance
of the employees and they rate the performance of employees in the store and report to the
company if the training is required company arranges for it. And whenever new product has
arrived to store they provide training on that particular product in the store learning center.

During the training conducted by the company they make sure that the employees are aware
about the products information and also sales associates are given proper selling skill tips and
training on selling procedure.

Employees are also trained on how to greet and groomed to their best ability and they are trained
to handle all minor issues encountered in the store.

Staff
Organizations are made up of humans and it's the people who make the real difference to the
success of the organization in the increasingly knowledge-based society. The importance of
human resources has thus got the central position in the strategy of the organization, away from
the traditional model of capital and land.
Reliance Digital has 58 stores in pan India and has got more than 1000 employees working for
the company.

Shared value
 We believe in people

 We believe in and follow the customer

 We believe in the good of the community

 We believe in each other

26
Style
Reliance Digital has a very friendly environment for all the employees .The management follows
top/down and bottom/up approach. Where in top management transfers the information from the
higher level to the lower level. The target and objectives are set by the top level managers and
are delegated to the lower level managers those in turn transfer to Team leader and sales
associates in the store level, hence all the major decision are taken by the higher authority and
shared to the lower level.

The lower level employees i.e., Team leader and sales associates revert back to the daily reports
to the Department manager who in turn reports to the store manager and further store manager to
his higher authority and it continues.

Every employee has a participative approach towards the business. Every employee is concerned
with his Duties, Responsibilities and accountability for the happening of the event and
employees have to report to their higher authority at regular intervals.

27
 4. SWOT Analysis

Strength:

 Brand Name Reliance - Reliance Industries Limited, is a Fortune Global 500 company
and is the largest private sector company in India.
 resQ Services - The dedicated service arm that is available for support all 365 days of a
year, from 10 a.m. to 10 p.m.
 Network - Over150 international and national brands.
 Private label sale – Some of own products (Reliance Reconnect).
 Product mix - One-stop shops for all technological solutions, it has over 4000 products at
reasonable prices.

Weakness:
 Poor inventory control.
 Inadequate human resources.
 Operating costs are too high.

Opportunity:
 Potential for investment.
 High growth potential.
 E-retailing.
 Retail franchising.
 Wholesale trading.

Threat:
 Increasing competitor’s market share.
 Price war with competitors.
 Inflation.
 Competition offered by Chinese products.

28
 5. Analysis of Financial Statements
Reliancedigital Retail Limited Balance Sheet as at 31st March, 2010

29
Analysis:
 Long term funds increase in 2010 compare to the year 2009. Share capital remains
unchanged where Reliance Digital Retail Limited borrowed more funds in the form of
secured and unsecured loans.
 The investment in fixed assets is increased to 10448.63 lakhs in 2010 from 8509.70 lakhs
in 2009.
 The investment on current asset increased from 3989.34 lakhs in 20009 to 6790.10 lakhs
in 2010.

Interpretation:
The Reliance Digital Retail Limited investing more money in the form of fixed assets.
The current liabilities are not sufficient to meet the regular requirements and also company is
using long term funds to finance current assets.

30
Profit and Loss Account for the year ended 31st March, 2010

The sale is increased from 31628.01 lakhs in 2009 to 41186.78 lakhs in 2010. Though sales has
increased when comparative to last year the loss margin increased in 2010 because of increased
in the operating expenses.
Reliance Digital Retail Limited should take measures to reduce operating expenses.

31
 6. Learning Experience

Opting for internship at reliance digital was an opportunity for me to understand the retail
industry and its nature of business. Understanding Retail management difference in organized
retail and unorganized retail was a huge scope for my learning, the process and operation in
organized and unorganized retails has a lot of difference that I could able to compare in my
learning.

Using theoretical knowledge of Marketing and Retail Management I found how practically the
strategies are implementing in organized retail and also I could find some areas of improvement
that can be done in the company.

Learning about merchandising and stocking in retail for the sale and motivating sales team was a
good exposure. I could find the level of difficulty in convincing customers and the pain that sales
team undergoes to make a sale of product.

In my course of the study I understood all the factors those are to be considered for an effective
sale where I could find how merchandising plays a vital role in attracting customers and
stimulate them to buy the product.

I understood the flow of work and the organizational hierarchy from top level management to the
store level. And also I could understand the motivational factors that make employees to have
job satisfaction in the organization.

Customer’s mentality towards promotional sales programme also led me to understand that
people look for price prior to the quality or the actual product. Overall exposure to Retail
Management was an eye opener to me as how business is carried out and what all should be
considered for making sales and to have effective retail management.

32
 7. General Introduction to The Study

Statement of the problem

Online advertisement being the one of the most effective advertisement channel for the any
brand or product, when company would like to go for the internet or online advertisement it is
necessary to understand the customers or internet users’ perception and behavior towards the
advertisement that is posted on internet. When the company plan to establish E Commerce
distribution channel it is essential to have internet advertisement strategies to ensure that it has
high reach to internet users or customers, that would create awareness of online distribution of
the products by the company as well as it promote the brand name. Therefore the statement of
the research problem would become the designing the strategies for internet advertisement for
the retail industry particularly electronic and durable retail segment hence the title of the project
is “A Study on Developing Effective Internet Advertising Strategies with Respect to Reliance
Digital at Bangalore”.

Objectives of the study

 To study internet advertisement strategies

 To study online advertisement strategies with respect to Reliance Digital
 To study perception of customers on internet advertisement
 To study customers awareness and preference for online purchasing
 To suggest measures for improvement to the company

Scope of the study

Reliance Digital management is planning to establish e-commerce distribution channel to make

easily available electronic and durable goods to their customers since it is necessary for the
company to advertise their brand on internet. Therefore study on developing effective advertising
strategies over internet would help the company to have advertisement strategies for online
advertising.

33
Methodology

Universe: The respondents for the study will be the people who have awareness about use of
internet and already using internet for the various purpose and the respondents can or cannot be
the customer of Reliance Digital but the respondents would have knowledge about electronic and
durable goods.

Sample Frame: The research is limited to Bangalore city.

Sample Size: The size of the sample is 100.

Sampling Technique: The technique used here is the non probability sampling method,
convenience sampling technique.

Data collection method

Primary Data collection method has been used; the information for the study collected from the
respondents who have the awareness of internet and using the internet for various purposes,
Primary data was collected from internet users to know the awareness of online purchasing and
the perception towards internet advertisements which would help in designing advertisement
strategies.

Tool of data collection

The tool used to collect the data was the questionnaire which consists of multiple choices, open
ended and close ended questions to measure the internet users’ attitude and perception towards
internet advertisement and also awareness of online purchasing.

34
Analysis Techniques

The collected data were analyzed using simple average method and Chi-square Test.

 Simple average method

Number of respondents for the particular research

------------------------------------------------------------------- X 100
Total number of respondents

 Chi-square (X2) Test

X2 = ∑ (Oi – Ei)2/ Ei

Where
Oi = the frequencies observed
Ei = the frequencies expected
∑ = the ‘sum of ’

Limitations of the study

1. The survey research is limited to Bangalore city only.

2. The respondents’ response may be bias.

3. As the sample size is 100, it may not be sufficient to get accurate data.

35
 8. Data Analysis, Interpretation and Observation

 How often respondents make use of internet

Options Percentage (%)

Once in a day 39
Twice in a day 28
Once in two days 10
Once in a week 7
Almost 24*7 16
Total 100
Table 8.1

Analysis
Form the above table we come to know that 39% of the respondents browse internet once in a
day, 28% twice in a day, 10% once in two days, 7% once in a week and 16% of respondents
browse internet almost 24*7.

Almost 24*7
16%
Once in a
week
Once in a day
7%
Once in two 39%

Twice in a
day
28%

Chart 8.1

36
Inference
The study shows that 39% of respondents browse internet once in a day it is being the highest
and 16% of respondents browse internet almost 24*7. Therefore 55% of respondents browse
internet on daily bases so with this we can notice that more than half of the internet users making
use of internet for various purposes in their day today life, hence internet being the best channel
for communication to create awareness about product or brand.

 Websites that respondents browse often

Percentage of
Websites Total Responses Responses (%)
Facebook 89 24.93
Google 95 26.61
Wikipedia 14 3.92
Gmail 58 16.24
Yahoo 45 12.60
Youtube 23 6.45
Others 33 9.25
Total 357 100
Table 8.2

Analysis
The above table reveals that respondents browsing websites often in their regular intervals 89
respondents using social networking website Facebook, 95 respondents says they browse google,
14 browse Wikipedia, 58 Gmail, 45 Yahoo, 23 Youtube and also 33 respondents browse other
websites viz., Rediffmail, Skype, twitter, linkedin, hotmail, moneycontrol, orkut, indiatimes,
songspk, torrento, irctc, icccricket, bcci, news.com etc.

37
 100
90
80
70
60
50 89 95
40
30 58
45
20 33
23
10 14
0

Chart 8.2
Inference
From the survey we can find that 95 respondents use search engine google and Wikipedia is also
being one of the search engine but only 14 respondents are using it where social networking
website Facebook having highest usage by the respondents, other social networking website such
as twitter, likedin and orkut etc having less usage by the same respondents. Gmail, Yahoo and
Youtube are used by 58, 45 and 23 respondents respectively. Other websites include Rediffmail,
Skype, twitter, linkedin, hotmail, moneycontrol, orkut, indiatimes, songspk, torrento, irctc,
icccricket, bcci, news.com etc. these all together mentioned by different respondents. By the
survey we come to know websites viewership by the respondents.

 Respondents browsing internet for advertisement

Options Percentage (%)

Yes 37
No 63
Total 100
Table 8.3

38
Analysis
37% of respondents browse internet for advertisement to know the product features, price, offers
and discount. And also for the comparison of products on which they are in need and some
respondents think that browsing advertisement on required product saves time in searching for
the information about the products.

Yes 37%

No 63%

Chart 8.3
Inference
From the chart 03 we can conclude that 37% of the respondents browse advertisement for
various reasons on their required product therefore posting advertisement of the products might
reach to these people on their requirement time.

 How respondents read promotional emails

Options Percentage (%)
Always 3
Sometimes 48
Often 11
Seldom 6
Hardly 20
Not at all 12
Total 100
Table 8.4

39
Analysis
From the Table 04 we can see that only 3% of the respondents read all the promotional emails
and 12% respondents do not read at all, 48% respondents say they read sometimes, 11% often,
6% seldom, and 20% hardly read promotional emails.

12%

20%

48%

Often

Chart 8.4
Inference
Study shows that only 3% reads all promotional emails and 12% do not read at all and from rest
85% we can come to conclusion that they read rarely. Hence mailing promotional emails may be
one of the ways to create brand and product awareness.

 Respondents aware of online shopping websites

Options Percentage (%)

Yes 77
No 23
Total 100
Table 8.5

40
Analysis
77% of the respondents have awareness about the online shopping websites and 23% do not have
awareness. Therefore we can see that 77% of the internet users have awareness about e-
commerce websites.

No
23%

Yes
77%

Chart 8.5

Inference
From the study we can draw inference that 77% internet user in the market are aware of e-
commerce websites hence these 77% of the internet users can be potential customer for the
company perhaps the company open an e-commerce distribution channel to make electronic and
durable goods available easily to customers. And here we will come to know about the market
awareness about online shopping websites.

41
  Awareness of online shopping websites

Total Percentage of
Online shopping websites Responses Responses (%)
Flipkart 52 31.51
Snapdeal 22 13.33
OLX 11 6.67
Homeshop18 9 5.46
Ebay 18 10.90
Amazon 13 7.88
Myntra 14 8.49
Naaptol 7 4.24
Others 19 11.52
Total 165 100
Table 8.6

Analysis
From the table we can see that 52 respondents has awareness about flipkart online shopping
website out of 77 respondents who has awareness about online shopping websites, 22
respondents know about snapdeal, OLX is known to 11 respondents and homeshop18, Ebay,
Amazon, Myntra, and Naaptol known to 9, 18, 13, 14 and 7 respondents respectively and also 19
respondents mentioned other shopping websites viz., futurebazaar, Mginger, indiatimesshoping,
inkfruit,quicker, tradus etc.,.

42
 60

50

40

30
52
20

10 22 18 19
11 13 14
0

Chart 8.6

Inference
In the chart 06 we can see flipkart is the online shopping website well known to all most all
respondents i.e. 52 respondents have mentioned flipkart website out of 77 respondents who have
awareness about online shopping websites. Snapdeal stands in the second palce 22 respondents
mentioned snapdeal and ebay being the third highest and also we can see OLX, Myntra, Naaptol
etc holding their position in the market through this survey. Here we can understand market
awareness of different e-commerce websites.

 Respondents have purchased products online in their past

Options Percentage (%)

Yes 39
No 61
Total 100
Table 8.7
Analysis
From Table 07 we will come to know that 39% of the respondents purchased different products
from various online shopping websites and 61% of the respondents have not purchased any of
the products online. And 39% respondents who have purchased have mentioned products that

43
they have purchased online they are pen drive, books, jewels, mobile, sho s, clothes, wrist
watch, iphone, micro oven, hard disk, laptop and movie tickets.

Yes
39%

No
61%

Chart 8.7

Inference
From the Chart 07 study shows that 39% of the respondents purchased different products from
online shopping websites and the products have already mentioned in analysis of table 07. With
this information we can come to conclusion that 39% of the respondents purchased online and
also mentioned electronic goods that they have purchased such as mobile, pen drive and laptop
and home appliance micro oven.

Chi-square (X2) Test

Chi-square test at 5% level of significance

Age Yes No
Group
20 - 25 9 20 29
25 - 45 24 30 54
Above 45 6 11 17
39 61 100

Ho: Online purchase made for products and the ages are independent.

E (1, 1) = 39*29/100 = 11
E (1, 2) = 61*29/100 = 18

44
E (2, 1) = 39*54/100 = 21
E (2, 2) = 61*54/100 = 33

E (3, 1) = 39*17/100 = 7
E (3, 2) = 61*17/100 = 10

Oi Ei (Oi – Ei)2 [(Oi – Ei)2 / Ei]

9 11 4 0.364
20 18 4 0.222
24 21 9 0.429
30 33 9 0.273
6 7 1 0.143
11 10 1 0.100
100 100 1.531

X2 cal = 1.531
X2 table = 5.99 [2 degree of freedom]

2 Degree of Freedom because (3-1) * (2-1) = 2 Degree

1.531<5.99
X2 cal < X2 table
Therefore accept Ho

 Respondents view about statement “Online marketing would take over traditional
marketing in next 10 years”
Options Percentage (%)
Strongly agree 29
Agree 51
Can't say 18
Dis-agree 2
Strongly dis-agree 0
Total 100
Table 8.8

45
Analysis
51% of the respondents agree to the statement online marketing would take over traditional
marketing in next 10 years, 2% dis agree to the statement and 18% of the respondents leave view
that can’t be said and in which 29% of the respondents strongly agree to the statement.

Disagree, 2% Strongly dis-

agree, 0%

Can't
say, 18% Strongly
agree, 29%

Agree, 51%

Chart 8.8

Inference
Study shows that respondents are very optimist about the online marketing only 2% of the
respondents dis-agree to the statement “Online marketing would take over traditional marketing
in next 10 years” and 18% says that it can’t be said but together 80% of the respondents are
optimist about the statement. This would help the study to draw inference about perception of the
respondents with respect to online marketing against traditional marketing.

46
  Easiest ways to get information about required product

Total Percentage of
Medium Responses Responses (%)
News paper 36 18.27
T. V. Ads 55 27.92
Internet 76 38.58
Product brochures 9 4.57
Pamphlets 6 3.05
Hoardings/Banners 12 6.09
Others 3 1.52
Total 197 100
Table 8.9
Analysis
Table 09 shows that internet being the easiest way to get information about required product, 76
respondents mention internet. T.V Ads stand in second place where 55 respondents feel that it is
another easiest way to get information about required product, news paper stands in third place
36 respondents mentioned news paper. Product brochures, pamphlets, & hoardings/banners
mentioned by 9, 6 & 12 respondents respectively. 3 respondents mentioned others they are
Mobile SMS i.e. promotional messages and friends recommendation.

80
70
60
50
76

40
55

30
36

20
10
12
9

Chart 8.9

47
Inference
From the chart 09 we can conclude that internet is the easiest way to get information about
required product, 76 respondents mentioned internet. 55 mentioned T.V.Ads and 36 mentioned
news paper. Therefore posting ads of the products would be effective way for advertising since
the study shows reach is very high than any other medium.

 Respondents prefer to watch motion advertisement on websites

Options Percentage (%)

Yes 78
No 22
Total 100
Table 8.10

Analysis
From the Table 10 we can see that 78% of the respondents would prefer to watch motion ads on
websites and 22% respondents will not prefer.

No, 22%

Yes, 78%

Chart 8.10

48
Inference
Survey says that 78% respondents prefer to watch motion ads on websites with this information
we can conclude that posting motion ads on websites would be effective in order to make best
advertisement strategy.

 Respondents view about the statement “Internet advertisement is more effective

than conventional advertisement”

Options Percentage (%)

Strongly agree 10
Agree 53
In differentiate 21
Dis-agree 16
Strongly dis-agree 0
Total 100
Table 8.11
Analysis
53% of the respondents agree to the statement “internet advertisement is more effective than
conventional advertisement”, 16% dis-agree to statement, 21% says cannot differentiate and 10%
says strongly agree to the statement.

Strongly dis- Strongly agree,

agree 10%
0%
Dis-agree
16%

Indifferentiate
21%
Agree,
53%

Chart 8.11

49
Inference
From the chart we can see that 53% of the respondents agree to the statement “internet
advertisement is more effective than conventional advertisement” and 10% strongly agree to the
same statement hence we can understand here the perception of the respondents against internet
advertisement and its effectiveness.

 Search for information on required product over internet

Options Percentage (%)

Yes 98
No 2
Total 100
Table 8.12
Analysis
From the Table 12 we can see that 98% of the respondents search for the information on required
products only 2% of the respondents do not search for the information on their equired products
over internet.

No,
2%

Yes, 98%

Chart 8.12

50
Inference
By the Chart 12 we can draw inference that since 98% of the respondents search for the
information on their required products over internet hence posting information about products
with the advertisement on internet would have higher reach than any othe medium to the
internet users.

 Online purchase preference by respondents

Options Percentage (%)

Yes 49
No 51
Total 100
Table 8.13
Analysis
Table 13 says that 49% of the respondents prefer online shopping where 51% of the respondents
do not prefer online purchase. We can see that almost half of the internet users prefer online
purchase/shopping.

No Yes
51% 49%

Chart 8.13

51
Inference
In the Chart 13 we can see that almost half of the respondents prefer online purchase hence by
the survey we can draw conclusion that having an e-commerce channel to a company might
increase its revenue and sales because 49% of the respondent says that they prefer online
purchase.

 Willingness to buy electronic & durable goods online among 49 respondents who
prefer online shopping

Total Responses Percentage of

Options Response (%)
Yes 37 75
No 12 25
Total 49 100
Table 8.14
Analysis
From the Table 14 we can see that among 49 respondents who prefer online shopping 37
respondents are willing to buy electronic and durable goods online and 12 respondents are not
willing to buy electronic and durable goods online.

No
25%

Yes
75%

Chart 8.14

52
Inference
We can see that out of 49 respondents who prefer online shopping 37 respondents are willing to
buy electronic and durable goods online i.e. there is a response around 75% for the willingness to
buy electronic and durable goods online hence having a plan to establish e-commerce channel for
the company would be a right decision.

 Reliance digital website browsed by respondents

Options Percentage (%)

Yes 5
No 95
Total 100
Table 8.15
Analysis
Based on the survey Table 15 says that 5% of the respondents have browsed “Reliance digital”
website and they liked the product information and the product display on the website would
give better visual experience. And 95% of the respondents never browsed “Reliance digital”
website so far.

Yes
5%

No
95%

Chart 8.15

53
Inference

From the Chart 15 we can see that 5% of the respondents have already browsed “Reliance
Digital” website and rest 95% never browsed the website hence creating awareness about the
company and the brand is crucial and therefore designing strategies for internet advertisement is
vital in order to create awareness in the internet users.

54
 9. Findings and Suggestions
Findings

 83% of respondents browse internet at least once in a day, which means it includes
respondents browsing internet twice in a day and respondents browse almost 24*7.
 Out of 100 respondents 89 respondents browse social networking website facebook most
often.
 37% of respondents browse internet for advertisement on their required product when
they are in need of particular product/service.
 Only 12% of the respondents do not read promotional emails at all.
 77% of respondents have awareness of online shopping websites.
 Flipkart is online shopping website known to 52 respondents out of 100 respondents.
 39% of respondents have purchased products online in their past.
 80% of respondents have perception that online marketing will take over traditional
marketing in next 10 years.
 Out of 100 respondents 76 respondents feel that internet is the easiest way to get
information about required product.
 78% of respondents prefer to watch motion advertisement on websites on their required
product/service in order to get complete information.
 63% of respondents agree to the statement “Internet advertisement is more effective than
conventional advertisement”.
 98% of respondents search for information on their required product over internet.
 49% of respondents prefer online purchase.
 Out of 100 respondents 49 respondents prefer online purchase (i.e. 49%), among 49
respondents 37 respondents have willingness to buy electronic & durable goods online.
 5% of respondents have browsed reliance digital website and they like product
information and display of product on the website.

55
Suggestions

 It is suggested that company should post advertisements on all social networking

websites.
 Company should send promotional emails to the existing and potential customers on
regular intervals.
 It is suggested to provide complete information about all available products on the
company website.
 It is suggested that company should conduct Soft skills training to the employees by
expert soft skill trainers.
 It is suggested to increase the customer attention and understand the actual need of
the same.
 Operating costs seems to be very high it is suggested to reduce the cost through switching
off few Lights and Display Televisions when there are no walk-ins of customers into
store.
 During peak hours of business it is suggested to implement waiting line strategies at the
billing counter.
 Employees should be trained on service quality and service quality delivery to the
customers.
 Service quality has to be delivered along with the product delivery to the customers.
 It is suggested to establish e-commerce channel soon and should be implemented proper
internet advertisement stratetegies.

56
 10. Recommendations and Conclusion

Recommendations

 It is recommended that company should post advertisements over internet on various

websites since the reach is high to the internet users.
 Company should establish e-commerce business arm since the awareness of online
shopping in the internet users is high which has been found by the study.
 Video advertisements of reliance digital can be shared on social networking websites and
also on other websites by giving the URL link from YouTube.
 Sufficient man power has to be recruited for all departments and respective sections of
the department.
 Proper Inventory management should be implemented in the organization in order to
have effective inventory control.
 ResQ and CRM team has to be trained on the concept “service with smile”.
 Background music played in the store has to be soft music and the odd filmy songs
shouldn’t be played in the store.
 Employees should be given the Retail industry latest trends and product knowledge.
 ResQ team should be monitored well in the performance of their duties and
responsibilities.

57
Conclusion

From the study we can draw conclusion that reliance digital can establish e-commerce business
arm to make available all electronic and durable goods easily to the existing and potential
customers. Study clearly shows that there is huge scope for e-commerce in the current scenario,
people are aware of online shopping and also most of them prefer online shopping since it saves
time and is more convenient to buy by making comparison with various other available products
over internet, hence it is necessary to have internet advertisement strategies to the company when
it has a plan to establish e-commerce arm. Posting the advertisements over internet on various
websites would have high reach to the internet users and would create awareness about online
shopping option. In order to have greater reach to all the internet users company can post
advertisements on social networking websites, and also other various website where people
browse most often such as yahoo, rediffmail, hotmail, youtube etc., and in the social networking
websites, facebook has the greater stake in the market. Most of the internet users have facebook
account and other social networking websites such as twitter, linkedin etc., also have the
potential to reach internet users. Therefore posting advertisement about products and services of
the company on social networking website will have impact on reaching online shopping option
provided by the company.

Most of the respondents in the study mentioned that online marketing would take over traditional
marketing in the next 10 years and also respondents have perception that internet advertisement
is more effective than conventional advertisement. Respondents are highly optimist about the e-
commerce business and its success in the future. Posting video advertisement of the brand would
be more effective and the same is preferred by the most of the respondents as it has been drawn
from the study. Video advertisement gives a kind of pleasure experience in watching it and also
provides information about the products.

Today internet users feel that the easiest way to get information about required products is
internet. Internet is only the medium where people can get the information immediately on
required product at any point of time. Hence posting advertisement about products available with
the company over internet would be effective in its reach to the customers who wish to buy the
products online or off line.

58
During the survey, respondents, when asked about if they ever browsed reliance digital website,
5% of the respondents mentioned that they did and liked the product display and Information on
the website that the company has given. At the same time when we browse reliance digital
website we do not find all products information those are available with the company, it is
suggested to company that they provide complete information of all products on the company’s
website along with product image so that customers can easily compare and view its features and
benefits that are with products.

Email marketing is one of the best ways to market the brand today. We can see many companies
are doing email marketing to promote their brand and respondents mentioned that few of them
read promotional emails always and few read rarely, but when respondents are in need of
products they go through the email that has been sent by the company. Hence it is suggested to
company that it should send emails about the offers during seasons and on regular intervals of
time so that brand can be get promoted by creating awareness in the internet users.

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 11. Internet Advertisement Strategies

1. Start with a web promotion plan and an effective web design and development
strategy.
The company can promote its website giving link on various websites such as yahoo,
rediffmail, hotmail etc. before to that company should design its website effectively such
that it should be more user friendly and more attractive to look. All available products
with the company have to be categorized systematically and products image should be
displayed with the complete information of products. The website has to be promoted
after the construction of website.

2. contextual ads on search engine results pages

A search engine results page (SERP), is the listing of web pages returned by a search
engine in response to a keyword query. The results normally include a list of web pages
with titles, a link to the page, and a short description showing where the Keywords have
matched content within the page. A SERP may refer to a single page of links returned, or
to the set of all links returned for a search query.

3. Banner ads over internet

A web banner or banner ad is a form of advertising on the World Wide Web delivered by
an ad server. This form of online advertising entails embedding an advertisement into
a web page. It is intended to attract traffic to a website by linking to the website of the
advertiser. The advertisement is constructed from an image (GIF, Flash, often employing
animation, sound, or video to maximize presence. Images are usually in a high-aspect
ratio shape (i.e. either wide and short, or tall and narrow) hence the reference to banners.
These images are usually placed on web pages that have interesting content, such as a
newspaper article or an opinion piece. Affiliates earn money usually on a CPC (cost per
click) basis. For every unique user click on the ad, the affiliate earns money.

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4. Blog and interact with your visitors.
A blog (a portmanteau of the term web log) is a personal journal published on the World
Wide Web consisting of discrete entries ("posts") typically displayed in reverse
chronological order so the most recent post appears first. Blogs are usually the work of a
single individual, occasionally of a small group, and often are themed on a single
subject. Blog can also be used as a verb, meaning to maintain or add content to a blog.
Many blogs provide commentary on a particular subject; others function as more
personal online diaries; yet still others function more as online brand advertising of a
particular individual or company. A typical blog combines text, images, and links to other
blogs, Web pages, and other media related to its topic. The ability of readers to leave
comments in an interactive format is an important part of many blogs. Most blogs are
primarily textual, although some focus on art (art blog), photographs (photoblog), videos
(video blogging or vlogging), music (MP3 blog), and audio
(podcasting). Microblogging is another type of blogging, featuring very short posts.

5. Write and publish online press releases.

Press release is one of the best online advertisement mediums and a definitive method to
build web credibility. Press release and Press release distribution service would make that
product/ service gets the right exposure to the target audience. Press release services
target not only Indian audience but have a global coverage.

6. Facilitate and run contests and give away via web site.
The Contests are facilitated on the websites which is decentralized competition, the
server automatically determines scores based on the performance of participants and
rewarded further on their scores. These contests facilitated via website of the company
and help to advertise the brand and its products/services.

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7. Facilitate Interactive media to potential and existing customers.
Interactive media normally refers to products and services on digital computer-based
systems which respond to the user’s actions by presenting content such as text, graphics,
animation, video, audio, etc.
Interactive media is related to the concepts interaction design, new
media, interactivity, human computer interaction, cyberculture, digital culture, and
includes specific cases such as, for example, interactive, interactive narrative, interactive
advertising, algorithmic art, videogames, and social media.
An essential feature of interactivity is that it is mutual: user and machine each take a
more or less active role. Most interactive computing systems are for some human purpose
and interact with humans in human contexts.

8. Social network advertising.

Social network advertising is a term that is used to describe a form of Online
advertising that focuses on social networking sites. One of the major benefits of
advertising on a social networking site (facebook, myspace, friendster, bebo, orkut...and
many others) is that advertisers can take advantage of the users demographic information
and target their ads appropriately.

There are three major classifications of Social Network Advertising:

a. Direct Advertising that is based on your network of friends - This can be the most
effective format but also causes the most controversy. An example is the Facebook
beacon project. Based on an action your friend has taken, you might see a message in
your news feed saying 'Bob has just bought a 'RadioHead CD from MusicWorld'. This
can be an extremely effective mode as often people make decisions to purchase
something or do something based on their close group of friends. However, there is also
a lot of controversy surrounding this as it can be considered exploiting the personal
relationships you have with your friends and also raises privacy concerns.

b. Direct Advertising placed on your social networking site - This is a more traditional
form of web advertising that is minimally effective. Just like you see banner ads on many
other sites, this is a similar concept, except on a social networking site. You can see these

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 - for example - as a brick in the top right of MySpace pages or as a banner on the left of
Facebook profiles and so on. There are two differences however - One is that these social
networks can take advantage of demographic data on your profile and hence target the ad
directly to you. Secondly, these types of ads can also be placed by individual developers
on their application pages through ad networks. They have access to the same data and
can generate income for application developers giving them further motivation to create
apps and giving advertisers a more engaging way to reach out to these social networking
users.

c. Indirect Advertising by creating 'groups' or 'pages' - This is an innovative marketing

technique in which a company will create a 'page' or 'group' that users can choose to join.
They will use this to build up 'subscribers' or 'fans' and use this to market a contest, a new
product, or simply just to increase brand awareness. These groups can quickly grow in
numbers of subscribers which can become a very effective marketing tool.

9. Interstitial Advertisements

On the World Wide Web, interstitials are web pages displayed before or after an expected
content page, often to display advertisements or confirm the user's age (prior to showing
age-restricted material). Most interstitial advertisements are delivered by an ad server.

Some people take issue with the use of such pages to present online advertising before
allowing users to see the content they were trying to access. Less controversial uses of
interstitial pages include introducing another page or site before directing the user to
proceed; or alerting the user that the next page requires a login, or has some other
requirement which the user should know about before proceeding.

10. E-mail marketing

Email marketing is directly marketing a commercial message to a group of people using

electronic mail email. In its broadest sense, every email sent to a potential or current
customer could be considered email marketing. It usually involves using email to send
ads, request business, or solicit sales or donations, and any email communication that is

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 meant to build loyalty, trust or brand awareness. Email marketing can be done to either
cold lists or current customer database. Broadly, the term is usually used to refer to:

a. Sending email messages with the purpose of enhancing the relationship of a merchant
with its current or previous customers, to encourage customer loyalty and repeat business.

b. Sending email messages with the purpose of acquiring new customers or convincing
current customers to purchase something immediately.

c. Adding advertisements to email messages sent by other companies to their customers.

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 12. Annexure
QUESTIONNAIRE

Sl.No.: /02/12
Place: Bangalore

I Pramod Kalli, Pursuing my MBA from CMRIT Bangalore (Affiliated to VTU Belgaum). I am carrying out
an academic project titled “A Study on Developing Effective Internet Advertising Strategies with Respect
to Reliance Digital at Bangalore”. I request you to spare your valuable time to respond the
questionnaire. The information shared will be kept confidential.

NOTE: PLEASE MARK YOUR ANSWER WITH IN [X]

1) Please fill personal details.

a. Name:
b. Gender:
c. Age:
d. Contact No.:

2) Do you use internet?

a) Yes b) No

3) If Yes, how often you use internet?

a) Once in a day b) Twice in a day

c) Once in two days d) once in a week

e) Almost 24*7

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4) Name the websites that you browse often…

Sl.No. Websites

5) Do you browse internet for any advertisement?

a) Yes b) No

6) If Yes, Kindly write the reasons to browse advertisement

a)
b)
c)
d)

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7) I read all promotional Emails of my Inbox.
a) Always
b) Sometimes
c) Often
d) Seldom
e) Hardly
f) Not at all

8) Are you aware of online shopping websites?

a) Yes b) No

9) If Yes, Name the websites that you aware of

Sl.No. Websites

10) Have you ever purchased online?

a) Yes b) No

11) If Yes, Name the product

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12) Online marketing will take over traditional marketing in next 10 years.

Strongly Agree Can’t say Dis-agree Strongly Dis-

Agree agree

13) In your opinion what could be the easiest ways to get information about required product?
a) News paper
b) T.V. Ads
c) Internet
d) Product brochures
e) Pamphlets
f) Hoardings/Banners
g) Others if others please mention

14) Would you prefer to watch motion (video) advertisement on websites for your required product?
a) Yes b) No

15) Internet advertisement is more effective than conventional advertisement.

Strongly Agree In differentiate Dis-agree Strongly Dis-
Agree agree

16) Do you search for information on your required products over internet?
a) Yes b) No

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17) Do you prefer online purchase?
a) Yes b) No

18) If Yes, Would you like to buy electronic and durable goods through online?
a) Yes b) No

19) Have you ever browsed reliance digital website?

a) Yes b) No

20) If Yes, what you liked most (please brief in your words)

THANK YOU

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 13 Bibliography
Books

1. David J. Luck and Ronald S. Rubin, Marketing Research (7th Ed; New Delhi: Prentice
Hall of India Pvt. Ltd, 2001)
2. G. C. Beri, Marketing Research (3rd Ed; New Delhi: Tata McGraw Hill Publishing Co.
Ltd, 2000)
3. Philip Kotler, Kevin Lane Keller, Pearson, Principles Of Marketing-,(12th
Edition,2006Phi)
4. Advertising and Integrated Brand Promotion, O’Guinn, Allen, Semenik, 4/e, Thomson,
2007
5. Integrated Advertising, Promotion, and Marketing Communications, Clow, Baack, 3/e,
Pearson Education, 2007
6. Roger D. Blackwell, Paul W. Miniard And James F. Engel, Consumer Behaviour (9th Ed;
New Delhi: Vikas Publishing House Pvt. Ltd.)

Journals
International Journal of Retail & Distribution Management
Journal of Retail & Leisure Property
Journal of Retailing and Consumer Services

Websites
www.ril.com
www.reliancedigital.in
www.indiaretailing.com
www.indiaretailforum.in
www.wikipedia.org
www.adcracker.com

Others
Reliance Digital Employees Induction Kit.
Reliance Digital Products Brochure.

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