Benefits of Market Research to K-Mart-Free-Samples for Students

Question: Discuss about the importance of Market analysis and the benefits a Company can derive from a thorough research of the Market. Answer: Introduction The report focuses on a marketing analysis that can help an organisation to succeed in the competitive market. Marketing analysis is one of the external factors that a business manager needs to consider in order to gain success in business (Grant, 2016). For the purpose of the report, K-Mart has been taken into consideration. A brief description of the company has been provided and factors such as market, analysis of competitors of K-Mart, target customers and barriers to entry are analysed. Apart from this, the importance of a proper retail layout is provided in the report to help understand the importance of organisational structure. About the company K-Mart is a leading department store headquartered in Illinois, United States. S.S. Kresge founded the company in 1899. It is one of the leading producers of retail products and has revenue of US$25.146 billion. Currently, the company operates in 49 states in the US. Apart from this, the company has branches in Canada, Australia, New Zealand, Mexico and in Eastern European countries. The company sells products such as clothes, shoes, jewellery, toys and food. As of the first quarter of 2017, the company has stores in 624 locations (K-Mart.com, 2017). Competitive analysis of K-Mart In order to gain success in the market, it is important for every business manager to conduct an external and internal analysis of the market (Warnick, Bojanic Xu, 2015). This is done in order to understand the level required to achieve success in the market. Similarly, in the case of K-Mart, the managers need to conduct an analysis of the factors that threaten the company. Some of the most factors that the company needs to consider as discussed. Market- According to Fleisher and Bensoussan, (2015), retail stores is one of the most business types in the market. This industry has a huge popularity largely because customers can get varieties of products in one store. In this regard, there remain competitors in the market. Some of the competitors that K-Mart has include Walmart, Macy's, Target Corporation and so on. In every country, the local retail stores pose a threat for K-Mart. In general, this type of market follows a common trend of satisfying customers. Hence, the growth rate in this market is high. However, Zhang et al., (2016) stated that employees of these organisations find the growth rate challenge. The retail industry itself has a high growth rate due to the rate of competition. Every company tries to out-compete one another. Hence, the introduction of new and innovative methods can help in the growth of the sector in general. The biggest advantage of this industry is the fact that secondary competitors do not exis t in the market. Hence, there can be no replacement for this type of industry as such. People can get food from one place but to purchase clothes they need to visit a different place. This is not so in the case of retail stores. Hence, no such threats exist in the market. Strengths and weakness of competitors- In order to conduct a competitor analysis it is necessary to understand the strengths and weaknesses of the competitors (Riasi, 2015). This can help in identifying the ways by which strategies can be developed in order to gain an advantage from other companies. For example, Walmart develops all types of products that are used by customers. Apart from manufacturing clothing or food products, the company also manufactures electronic goods, sports equipment as well as jewellery and so on. This gives an added advantage to the company for attracting customers. However, the company have also suffered losses while investing in foreign countries. Apart from the UK and the South American countries, the retail store suffered a failure while conducting business in Germany and South Korea (Walmart.com, 2017). This is also indicative of the fact that lack of proper market research can lead to loss or failure of a business. Thus, based on this analysis, K-Mar t can strategically conduct its business and ensure that the company remain productive in the market. The target market can also be deduced based on this analysis. Target market- Identification of target market is important for the success of an organisation. Every organisation needs to aim at manufacturing products keeping in mind the customers it hopes to attract. This can help it to reduce production cost and focus on manufacturing quality products each time (Weinstein, 2014). The customers can be segmented based on the preferences, demography and culture and so on. Based on these, managers of a company can manufacture products that can help in gaining success. In the case of K-Mart, it can be said that the company manufactures all kinds of products. However, there are products that it fails to manufacture. The rivals Walmart manufacture items such that are required to excel in sports. Hence, it can be said that K-Mart needs to manufacture those products that Walmart does not provide to its customers. Analysis from Aghdaie and Alimardani, (2015) has shown that K-Mart manufacturers linen and beds that are not found in Walmart. Thus, this can be a base for K-Mart to attract customers. It can provide discounts at a considerable rate in order to grab the attention of the customers. Apart from this, it needs to ensure that the products it sells are better than that of Walmart in terms of quality and price. Entry barriers- The barriers to entry are a major factor for companies that are willing to start up or aim at expanding in a foreign country. According to Kenny, (2013), several reasons can cause barriers to entering a market. The foremost factor that causes barrier is the existence of established companies. Enterprises need to analyse the foothold local business have on the market before investing in a new venture. This can help to make improvements to any strategies that are required to gain a competitive advantage. Other reasons behind the existence of barriers are the policies of the Government (Jones Sufrin, 2016). Every country has a set of Governmental rules that need to be abided by before starting a business. In the case of K-Mart, the barriers to entry are not a strong threat. The cost of entering the market is not high hence; retail company manufacturers can apply itself in the market. This can be a weakness for K-Mart. This is because reputed companies, as well as new co mpanies, may have sufficient resources that are capable of giving a stiff competition to K-Mart. Hence, the easy entry in the retail market can pose a serious threat for K-Mart. Opportunities- K-Mart is one of the leading retail stores in the world. With branches in most countries, K-Mart has established a reputation for itself. However, other retail industries pose serious threats to K-Mart. This is because these organisations may have better and various products than K-Mart. Hence, this can be a serious threat for the company (Chang Wu, 2014). However, the strengths of the company can lead to opportunities. K-Mart does not have to rely on time-sensitive technology as the reputation of the company precedes it. Hence, in a case of expansion of the tactics of K-Mart is to set up branches in rural areas. This can attract customers, as the presence of other companies in the region is low. Hence, an opportunity to improve in the market is high in these areas. According to Kappes and Merkert, (2013), K-Mart does not need to gain early access to a market to gain an advantage. This is because the market strategy of K-Mart and its reputation help it to mark its dom inance over the emerging markets. In this regard, the acquisitions of new brands can help in increasing the sales of the company. Thus, the opportunities for growth and expansion are more for K-Mart. Importance of retail layout According to Hollensen, (2015), plans of an organisation are an essential factor to maintain its stability. In the case of retail stores, a proper layout can guide customers to their destination. The structuring of the floor and the arrangement of items need to be proper so that customers do not face any problem. This can be a successful policy of an organisation (Foster McLelland, 2015). A well-organised and clean store is a natural favourite for customers. This is because customers prefer quick solutions to the problems they face. With a well-structured store, customers can find products easily. Conclusion Thus, it can be concluded that marketing analysis is an important factor for the success of an organisation. Even for a famous organisation like K-Mart, competitors pose threat to the store. The strengths and weakness of the competitors can be used by K-Mart to formulate strategies. This can help it to create more opportunities for improving its sales. The barrier to entry in the retail field is not restricted hence; new companies can also cause threat for the organisation. Thus, by keeping these factors in mind, it can be said that every manager needs to analyse a market thoroughly before investing in it. Reference Aghdaie, M.H. Alimardani, M., (2015). Target market selection based on market segment evaluation: a multiple attribute decision making approach.International Journal of Operational Research,24(3), 262-278. Chang, S. J., Wu, B. (2014). Institutional barriers and industry dynamics.Strategic Management Journal,35(8), 1103-1123. Fleisher, C.S. 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