Positioning strategy in retailing: a study of Wuhan Wing on children shopping and Amusement Centre Company Limited

Abstract

"To position the product in the mind of the prospect," this statement is very simple and straight forward, but the actual practice is complicated and profound. By adhering to the positioning concept and through the study of a children products store, this thesis investigates how people interpret positioning, studies the impact of positioning strategy on the designated store, reviews the retail market in China, tries to explain the influence of positioning on the customer shopping components, and looks at ways to revitalize the store business. As a staring point, the background of the positioning concept is studied. By reviewing articles from both marketing and retailing perspectives, the nature of positioning concept is clarified and the conceptual framework for the positioning strategy process is also established. To make the investigation of the Wuhan Wing On Children Shopping and Amusement Centre Company Limited, an overview of the retail market situation of the People's Republic of China is done. The China market has good potential but, to get rewards from such a market, foreign retailers should be patient and have long term plans. Wuhan has potential for further growth too, but many foreign retailers might have overlooked such an emerging market. As a joint venture company, Wing On was established in late 1992 by the Hong Kong and China parters. Positioning itself as the most modem and largest children products store in both Wuhan and China, Wing On made breakthroughs in the Wuhan retail industry in terms of openrack display system, goods retur guarantee, service quality, computerisation, etc. Through such right positioning, the sales result was excellent. However, because of the 'follow the wagon' effect, the store floor area ofWuhan doubled in 1996. Even then such a change did not affect Wing On very much, until the emergence of the new major competitor, Children World, which also positioned itself as the market leader. Then Wing On suffered. Through the survey research with the customers and Wing On employees, and by analyzing the different groups of respondents, it is found that Wing On is lagging behind Children World in terms of overall attitudes measurement. Even for the foureen store attribute comparson, Wing On is also at a disadvantageous condition, especially for the store facilities. Multiple regression analysis was used to trace the relationships between the background, shopping criteria, beliefs, and action of the frequent customers. In view of the adverse situation, it is recommended that Wing On should reposition itself in order to revitalize its business. Under this circumstance, the relevant positioning statement and positioning strategy guidelines are suggested. Through this study, it is found that the nature of positioning concept is segmentation, target marketing, and differentiation. Moreover, for better market performance, when applying the conceptual framework of the positioning strategy process, both the positioning statement and positioning strategy should be taken into consideration at the corporate management leveL. Also, there is a close linkage between marketing and positioning. On the whole, it is envisaged that the positioning/repositioning concept wil be more important and popular in the days to come.