Kmart

Retail Business Analysis

BUS620: Managerial Marketing

Dr. Lee Meadows

August 29th, 2011

Retail Business Analysis

All organization need to invest in market research to be at the forefront of its business. The marketing effort must take into account market segmentation to build a strong marketing department. These concepts apply to the retail industry, which have evolved into a very competitive industry for which Kmart is a discount retailer pioneer. Kmart is the third largest retailer in the US even after filing chapter 11, that allows them to re-structure. For Kmart, efficiency is the key concept on cost with the likes of Walmart and Target. Therefore, Kmart needed to change their marketing strategy that failed their customers before.

Kmart new strategy is to continue their partnership with brand-names that appeal to their new target customers (Latinos and African-Americans). Using market segmentation which “is the process by which a market is divided into distinct subsets of customers with similar needs” (Mullins and Walker (2010), p. 180). Segmentation was a key factor in Kmart's failure because their inability to decide which market to be in. Marketers representing Kmart need to find an identity that will satisfy their customers. Some of the brand-names they carried are targeted towards inner-city minorities; however, Martha Stewart's fans are part of a different market. Marketers from Kmart need to position itself as a low-price retailer for urban multicultural communities to create an identity with the customers. The Latino / African-American market segment can become Kmart's specific market and it can create a niche for its organization to serve a community that is somehow neglected by its retail competitors. Focusing on the segmentation strategy of this target market can help Kmart to create customer satisfaction with this segment of the market. It is a given fact that unless Kmart develops a new marketing strategy, and defines an specific...