Question

Imagine that you are part of the marketing management team at Home Plus, a regional discount big-box retailer who competes with Wal-Mart and Target. Home Plus currently focuses on offering a broad range of discount consumer goods, from small home furnishings and clothing to packaged goods and kitchenware. In addition to the discount lines, Home Plus carries some higher end clothes, shoes, and bedding. Some members of management believe that the best way to improve the company's competitive positioning is to concentrate more of its energies on the higher-end product lines. They have proposed that Home Plus double the number of luxury products it carries and halve the number of discount consumer packaged goods.

In an essay, explain why you would agree or disagree with the proposed change in marketing strategy. Be sure to discuss both the proposal's advantages and its disadvantages.

Answer 1

I would disagree with the proposal to halve the number of discount consumer packaged goods and double the number of luxury products. The reason for disagreeing is that the Home-Plus is a big box retailer. It should offer both discount goods as well as high end products. If the discount goods are reduced in number then the number of customers who come to the store to purchase these discount goods will reduce. The reduction of the number of customers is never a good sign for any retailer. The aim of the store should be to encourage the customers (who buy discount goods) to buy the high end products as well. This way the sales of the high end products can be increased. The promotion of the high end products has to increase like advertisements, offers, sales promotion etc.

Advantage:

The retail store Home Plus will be able to earn more revenue from the consumers as they will now be buying discount goods as well as high end goods. The revenue earned will be high.

Disadvantage:

The retail store's employees will have to concentrate more on the promotional activities that may lead to increase in the expenses of the company.