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Staples
Strategic Marketing in Practice
Case Study
June 2009
David Kilburn
C A M B R I D G E M A R K E T I N G C O L L E G ES
© CMC 2005
Scenario
• You are employed as a very experienced
(20 years) marketing professional and are
expected to advise the client
TASK:
– Prepare a report on the current state of the business
– Implications for Staples’ international marketing
strategy development
– Possible branding and strategy development
– Possible marketing communications
– Possible international expansion/consolidation
– Critical analysis of the office supplies, stationery,
furniture, equipment technology, printing and mailing
services
C A M B R I D G E M A R K E T I N G C O L L E G ES
© CMC 2005
Where are we now ?
Audit of current situation
C A M B R I D G E M A R K E T I N G C O L L E G ES
© CMC 2005
The office supplies and stationery industry
• The global office supplies industry is a
fragmented market with many providers
• Staples’ share of the $177 billion global
market is 10.73%
• Competition comes from not just specialist
operators but also large Retailers such as
Walmart, and specialists in printing, mailing
services, office equipment, furniture and
technology
• Internet and catalogue sales are additional
channels of distribution
C A M B R I D G E M A R K E T I N G C O L L E G ES
© CMC 2005
Brand issues
• BRAND DOMAIN
(brand’s target market)
• BRAND HERITAGE (how it has achieved success)
• BRAND VALUES
(core values and characteristics)
• BRAND ASSETS
(what makes brand distinctive)
• BRAND PERSONALITY (character of brand)
C A M B R I D G E M A R K E T I N G C O L L E G ES
© CMC 2005
Global stationery, office supplies SWOT
Strengths
• Product lines are sought after
• Rise and rise of education
globally raises demand for home
study, paper, equipment, etc.
Weaknesses
• Fragmented market
• ‘Me too’ products
Opportunities
• Global reach
• Underdeveloped countries
• Distance learning/virtual campus
• Faster growth in Europe currently
Threats
• Crowded marketplace-winners and
losers
• Buy outs, consolidation
• Saturated market in developed world
• Barriers to switching are low
• Customer loyalty low
• Global recession
• Litigation- IP etc.
C A M B R I D G E M A R K E T I N G C O L L E G ES
© CMC 2005
Staples - SWOT
Strengths
• Global operator
• 2,000 stores in 22 countries
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Weaknesses
Undifferentiated position
Overstretched resources in an
economic downturn
Nimble, agile, innovative
Quick decision making
B2B and B2C markets
22% of sales are proprietary branded
products, including Staples and Quill
Opportunities
Threats
• Training and consumable product sales
Decline in consumer
confidence
• Expand centres of excellence nationwide Other companies may out
innovate Staples
• Increase sales by greater focus on
Global credit crunch
customers and markets
• International expansion- acquire
competitors via mergers and acquisitions
C A M B R I D G E M A R K E T I N G C O L L E G ES
© CMC 2005
Map of competition
National chains
International chains
WHSmith
Rymans
Computer World (DSG)
Best Buy, Office Max
Office Depot
Corporate Express
Avery Dennison
Corporation
Local providers
Leading global
retailers
Numerous
independent
companies serving
local needs
Costco
Walmart
C A M B R I D G E M A R K E T I N G C O L L E G ES
© CMC 2005
PESTLE
Political
• Governments and regulatory bodies may
block any attempts at further industry
consolidation
C A M B R I D G E M A R K E T I N G C O L L E G ES
© CMC 2005
Economic
• Credit crunch in the U.K. has dampened
consumer spending – has hit all industries
• Global credit crunch has impacted
consumer spending all over the world
• Disposable income has been badly hit
• Consumer confidence has hit rock bottom
• Difficult times ahead
• Possible deflation in U.K. and inflation in
USA
C A M B R I D G E M A R K E T I N G C O L L E G ES
© CMC 2005
Sociological
• Greater need for social housing
• Greater need for single units for
households – less marriages, older people
living longer, divorce rates high
• Greater interest in environmental issues,
ethical trading, reduction of carbon
footprint
C A M B R I D G E M A R K E T I N G C O L L E G ES
© CMC 2005
Technological
• Technology is ever changing
• Opportunities are endless
• Sophisticated database marketing
techniques now possible
• Rise and rise of internet sales
C A M B R I D G E M A R K E T I N G C O L L E G ES
© CMC 2005
Legal/Environment
Legal
Legal action can be taken against companies
who flaunt safety regulations, non
compliance offences punished
Environment
• C.S.R.- companies will have to use more
biodegradable fuel, lessen impacts on
environment, ethical sourcing,
• Growing need for companies to target
environmentally aware target segments
C A M B R I D G E M A R K E T I N G C O L L E G ES
© CMC 2005
Consider Staples’ positioning
• Use either BCG or PLC
C A M B R I D G E M A R K E T I N G C O L L E G ES
© CMC 2005
Brand Equity
• Bonding –----How does it retain itself with me
• Advantage – --Does it offer something different
• Performance- -Can it deliver
• Relevance – Does it offer something I want
• Presence- Do people know it
C A M B R I D G E M A R K E T I N G C O L L E G ES
© CMC 2005
Where do we Want to be?
C A M B R I D G E M A R K E T I N G C O L L E G ES
© CMC 2005
Objectives
• Decide
• Objectives
– For U.K. and International
• Deliver
• Outcomes
C A M B R I D G E M A R K E T I N G C O L L E G ES
© CMC 2005
Segmentation
• Described and Profiled for each sector
C A M B R I D G E M A R K E T I N G C O L L E G ES
© CMC 2005
Segmentation
B2B
B2C
C A M B R I D G E M A R K E T I N G C O L L E G ES
© CMC 2005
Targeting
Target and penetrate existing markets B2B
and B2C and also new market
segments globally
C A M B R I D G E M A R K E T I N G C O L L E G ES
© CMC 2005
Positioning
• Clear and defensible
– Set out USP and Positioning for each sector.
– Are there any commonalities or Single Brand
options
• Vision
• Values
C A M B R I D G E M A R K E T I N G C O L L E G ES
© CMC 2005
USP and Positioning
USP – socially responsible,
proactive regarding environment, strong
ethical trading stance
Positioning – number one in world for
stationery and related products, leading the
global industry in terms of ethical
sourcing, environmental issues, health and
safety, staff training and development
C A M B R I D G E M A R K E T I N G C O L L E G ES
© CMC 2005
Segmentation
Segment – B2B
B2C
C A M B R I D G E M A R K E T I N G C O L L E G ES
© CMC 2005
Targeting, USP, Positioning
Target and penetrate existing markets in the
office supplies industry and also new markets
internationally
USP – leading the industry for ethical sourcing and
trading, protecting the environment and
staff development
Positioning – number one office supplies
company in the world for environmental
protection, quality service and customer
intimacy
C A M B R I D G E M A R K E T I N G C O L L E G ES
© CMC 2005
How do we get there?
C A M B R I D G E M A R K E T I N G C O L L E G ES
© CMC 2005
Action
•
•
•
•
Decide
Objective
Deliver
Outcomes
C A M B R I D G E M A R K E T I N G C O L L E G ES
© CMC 2005
Strategic Development
• Product
– Sector Selection
– Core/ Physical/Augmented Proposition
– Branding
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Pricing
Distribution
Promotion
People
Process
C A M B R I D G E M A R K E T I N G C O L L E G ES
© CMC 2005
Implementation and Control
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Budgeting Areas
Metrics
Balanced Scorecard
McKinsey 7S
C A M B R I D G E M A R K E T I N G C O L L E G ES
© CMC 2005
Comms Strategy for Speedy Hire
• Audiences –Internal and External, domestic and
international, and Corporates
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Media
Messages
Timing/Budget
Stakeholders
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Investors
Suppliers
Partners
Customers
Media
Regulatory Bodies e.g.
Who else ?
C A M B R I D G E M A R K E T I N G C O L L E G ES
© CMC 2005
Internationalisation
• Where, when and how
– GE/ Harrel and Keiffer
C A M B R I D G E M A R K E T I N G C O L L E G ES
© CMC 2005
Implementation and Control
•
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Budgeting Areas
Metrics
BS
McKinsey 7S
C A M B R I D G E M A R K E T I N G C O L L E G ES
© CMC 2005
Critical success factors
• Create a sustainable brand image and position
amongst competitors
• Change management (PLC,BCG)
• Internal marketing (stakeholder management,
CRM)
• Funding (Borrowing/J.V/Debt/ Licensing/I.P)
• Constraints – Overstretching
- Competitive landscape
- Changes within the office supplies
industry
C A M B R I D G E M A R K E T I N G C O L L E G ES
© CMC 2005
Vision
For Staples to become an established
Group who have a strong and loyal customer
base, enabling them to invest in a robust,
innovative international marketing plan
which will keep them top of mind and in the
leading position in the global office supplies
industry for the next 10 years
C A M B R I D G E M A R K E T I N G C O L L E G ES
© CMC 2005
Mission statement
To become a leading player in the global
office supplies, technology and printing
business who can sustain and increase its
popularity amongst business customers
and consumers who recognise quality,
service and value, using ethically sourced
products from around the globe.
C A M B R I D G E M A R K E T I N G C O L L E G ES
© CMC 2005
Values
• Committed to providing high quality,
technically advanced, reliable equipment
to all our customers
• Committed to providing our customers
with products which are easy to use and
dependable
• Committed to continual dialogue with our
customers, and to provide excellent
service across all our business domains
C A M B R I D G E M A R K E T I N G C O L L E G ES
© CMC 2005
Corporate objectives
• To ensure that the Group has the correct
financial advice and backing to be a
leading player in the global office supplies
business
• To become even more successful
internationally and leverage the financial
benefits of this expansion
C A M B R I D G E M A R K E T I N G C O L L E G ES
© CMC 2005
Strategic management of marketing mix
• Product
Core – office supplies, stationery,
technology, printing and mailing services
to business and consumer
Augmented – durable, environmentally
friendly
• Price
Favourable price – value for money
C A M B R I D G E M A R K E T I N G C O L L E G ES
© CMC 2005
Strategic management of marketing mix
• Place
Global presence – but needs to drive more sales
by targeting the European and South American
markets, (notably Italy, France) plus (notably
Brazil and Argentina)
• Promotion
Web site – continually update the content.
Positive P.R. ( environmental, ethical). Personal
selling, excellent customer service.
C A M B R I D G E M A R K E T I N G C O L L E G ES
© CMC 2005
Strategic management of marketing mix
• People
Train and develop the existing staff and also
retrain staff from new acquisitions. Selective
recruitment of key sales/marketing/technical
personnel. Recruit proven staff in new overseas
markets to establish and promote the business.
• Processes
Regular internal/external communication. Long
term relationship building. B2B customer
involvement with key accounts. Relationship
marketing. Customer Lifetime Value. Branding
strategy.
C A M B R I D G E M A R K E T I N G C O L L E G ES
© CMC 2005
Strategic management of marketing mix
Physical evidence
Interactive, informative web site
Number of awards won for environmental
and ethical approach.
Endorsements from satisfied customers
The Staples logo and brand
ROI table – comparison with other global
office supply companies
C A M B R I D G E M A R K E T I N G C O L L E G ES
© CMC 2005
Implementation and Control
McKinsey 7S
Structure
Based in USA, with offices in U.K.,Europe,
Asia and possibly South America
Strategy
Focus differentiated aimed at loyal
customer base and potential customers in
U.K. and overseas
C A M B R I D G E M A R K E T I N G C O L L E G ES
© CMC 2005
Implementation and Control
Systems
Develop MKIS and control systems to regularly
review and monitor effectiveness of all marketing
strategies
Develop benchmarking system to monitor against
key market indicators and main competitors
Staff
Continual development of all staff, especially
staff from new acquisitions. Advanced product
and sales training, inbound and outbound, online
and offline, CRM development. Key relationship
building with educational and commercial
Contractors, businesses, Government
departments and key influencers in global
markets
C A M B R I D G E M A R K E T I N G C O L L E G ES
© CMC 2005
Implementation and Control
Skills
Ensure correct training and development
programmes are established to keep Staples at
the leading edge of technology, systems and
processes
Shared values
Ensure company strategy is shared by everyone in
the organisation. Growth strategy and national
and international expansion shared with all staff,
influencers and key stakeholders.
C A M B R I D G E M A R K E T I N G C O L L E G ES
© CMC 2005
Implementation and Control
Style
Acquisitive, innovative, agile and nimble.
Quick to spot opportunities ahead of the
competition.
C A M B R I D G E M A R K E T I N G C O L L E G ES
© CMC 2005
Control – Balanced Scorecard
Internal
Develop CRM databases for collecting
customer feedback and insights into future
needs, wants, industry trends, (market
intelligence)
C A M B R I D G E M A R K E T I N G C O L L E G ES
© CMC 2005
Control – Balanced Scorecard
Innovation and learning
Skills training – advanced B2B selling,
super deal closers who ‘champion’ the
product portfolio. Technological
development to ensure quality and
environmental issues are paramount to
leverage financial benefits.
C A M B R I D G E M A R K E T I N G C O L L E G ES
© CMC 2005
Control – Balanced Scorecard
Financial
Sales vs. targets in each sector – UK, USA
(potentially France, Italy, South America
etc.) Profitability metrics, CLV
Customer
Customer satisfaction surveys – customer
feedback. Customer endorsements - web
based
Brand recall/awareness of brand
C A M B R I D G E M A R K E T I N G C O L L E G ES
© CMC 2005
Possible questions
1 In the light of recent joint ventures, mergers
and acquisitions, what branding strategy
should Staples adopt to maximise sales and
profitability ?
2 Devise an international marketing plan which
will enable Staples to expand and maximise
its profitable operations overseas
C A M B R I D G E M A R K E T I N G C O L L E G ES
© CMC 2005
Possible questions
3.What branding and positioning strategy
should Staples adopt to improve its appeal
to business customers?
4.Devise a marketing plan to make Staples a
leading player in the global office supplies
business
C A M B R I D G E M A R K E T I N G C O L L E G ES
© CMC 2005
Possible questions
5.
Prepare a relationship marketing campaign
which will effectively increase Staples’
customer loyalty and their lifetime
value.
6.
Staples is at a critical point in its
development and growth. Produce a
strategic marketing plan which will ensure
increased revenue and negate the
marketing strategies of domestic and
international competitors.
C A M B R I D G E M A R K E T I N G C O L L E G ES
© CMC 2005
Possible questions
7. Prepare a corporate social responsibility
charter for Staples in the light of the growing
importance of environmental and ethical
issues
8. Prepare a communications plan which will
increase sales and profitability for Staples
across all its target markets
C A M B R I D G E M A R K E T I N G C O L L E G ES
© CMC 2005