Reference no: EM131019531

Task 1: Case study

JB Hi-Fi is an Australian retailer of consumer electronics, as well as a supplier of video games and of Blu-Rays, DVDs, and CDs. It is a chain store operation headquartered in Melbourne. JB Hi-Fi Limited (JBH) is a specialty discount retailer of branded home entertainment products. The Group's products particularly focus on consumer electronics, electrical goods and software including music, games and movies. The company primarily operates from stand-alone destination sites and shopping centre locations and its online stores in Australia and New Zealand.

JB Hi-Fi was established in the Melbourne suburb of Keilor East by John Barbuto in 1975. Barbuto sold the business in 1983 to Richard Bouris and David Rodd who expanded JB Hi-Fi into a chain of ten stores in Melbourne and Sydney turning over $150 million by 2000, when they sold the majority of their holding to private equity. It was subsequently floated on the Australian Stock Exchange in October 2003.

At first, the company specialised in Hi-Fi equipment. As the mainstream popularity of vinyl records declined, in 1991 JB Hi-Fi cleared out their entire stock of records and began offering exclusively CDs, and was one of the first Australian music retailers to do so. However due tothe recent revival of vinyl records larger stores began to stock them again. This allowed JB Hi-Fi to open many new stores in Melbourne and later expand to other states. The chain now has stores all around Australia and in New Zealand's largest cities.

Recently, while many music stores claim to have been losing money, JB Hi-Fi has increased profits by 26% FY10 when compared to 2008/2009. JB also specialises in imported CDs, mainly from the United Kingdom and the United States, although CDs from other places, such as Africa, Asia and South America are available on special order.

JB Hi-Fi has diversified its business from predominantly selling music CDs, and are now a major retailer for numerous consumer electronics including Plasma and LCD televisions, audio/visual, digital camera photography, portable audio, in-car entertainment, computer/video games, gaming consoles and accessories, white goods (fridges and freezers) and DVD & Blu-ray movies, gadgets and information technology. As of 2012, JB HiFi has diversified into other accessories, such as CB Radios, IP and fixed surveillance camera systems, musical instruments such as guitars, electronic keyboards, Ukuleles and guitars, and professional DJ equipment such as CD mixers, microphones and portable DJ P/A docking systems.

Currently JB Hi-Fi is the number one retailer of Apple Computer hardware in Australia, even more than Apple retail stores. JB Hi-Fi is also the sole retail chain in Australia that sells Dell Computer hardware in retail stores.

The Sydney Morning Herald reported in June 2007 that JB Hi-Fi is now Australia's biggest CD retailer and is second in terms of sales of computer games, televisions and car stereos.

In the full year 2009/10 report, it was reported that there are now 131 store locations in Australia and 10 in New Zealand.

As of 27 July 2014 the JB Hi-Fi Website Store Locator listed 171 store locations across Australia (ACT 5, NSW 50, NT 2, QLD 34, SA 9, TAS 2, VIC 50 and WA 19).

As of 6 August 2014, the company has 13 stores open in New Zealand, with eight in Auckland and one store each in Hamilton, Tauranga,Palmerston North, Wellington and Dunedin.

In November 2011, JB Hi-Fi announced a web-based, streaming music service called JB Hi-Fi NOW which allows people to stream unlimited music for A$99 per year. On 13 December, the service was launched offering a free one-month trial. JB Hi-Fi NOW claims a library of up to seven million tracks, with plans to expand the library to around 15 million tracks. As of April 2012, JB Hi-Fi NOW is now available from iPhone and Android Apps, and as of late 2012, the app is now available on Windows Phone 7.

In December 2012, JB Hi-Fi launched "JB Hi-Fi Home", an ancillary to their business selling whitegoods and appliances.

In April 2013, JB Hi-Fi announced and launched an ancillary service to their "JB Hi-Fi NOW" service, books.jbhifi.com.au - which sells e-books online to JB Hi-Fi NOW customers.

Strategy Analysis

Growth is driven by a store rollout program which adds around 13-15 sites per year with a long term goal of 214 national stores. The product mix is constantly revised to ensure competitiveness. JBH´s reluctance to take on the new devices illustrates strict product selection. Margin gains derive from scale benefits which reduce the cost of doing business. Diversification into New Zealand is still in its early stage and is not likely to contribute in a meaningful way in the near term. JB Hi-Fi reported NPAT up 3.04% to $82.06m for the half-year ended 31 December 2012. Revenues from ordinary activities were $1.82bn, up 2.34% from the same period last year. Diluted EPS was 83.01 cents compared to 80.49 cents last year. Net operating cash flow was $113.45m compared to $215.91m last year. The interim dividend declared was 50 cents compared with 49 cents last year.

Promotions, Marketing & Loyalty

JB Commercial is one of Australia's & New Zealand's largest providers of merchandise and gift cards to the marketing and loyalty industries. If you redeem a gift through one of a number of high profile loyalty plans, you are more than likely being fulfilled by JB Commercial. In addition, JB Commercial can develop standalone loyalty programs for smaller incentive plans or individual companies and can offer online portal purchasing. JB Commercial is your partner in all things "promotional".

• Gift Cards
• eCards
• Electronic Merchandise
• Appliances
• Complete National Fulfilment

Your Tasks - Please address the following:

1) Describe the steps you would take to identify what type of promotional activity JB HiFi wants to host and the objectives of the promotion?

2) Describe how you would go about planning the activity and scheduling it to ensure it fitted into the needs of the Marketing department of "Whiz-Bang Stationary Suppliers"?

3) Identify the internal and external people would you consult to find out information about what resources maybe required?

4) Explain if your promotional activity be hosted on site or at a venue? Why?

5) Specify all costs associated with hosting this activity and present it in a format that is easy to understand. Please attach prices for hire, food and beverage, and all other costs.

6) Create a timeline of events that you will need to arrange, and facilitate leading up to the function.

7) Detail how you will ensure that all expenditure fits into your budget and that you're not exceeding your budget?

8) Detail the personnel or resources you will require on the night and why you will need them.

9) Detail what roles and responsibilities will be allocated to what departments and why they will be suitable to assist in this area. Highlight what they will be able to bring to the promotional activity.

10) Create a process for gathering feedback from the customers who will attend the promotional activity. Explain how you will be able to see if the promotional activity has been a success, explain what timelines you may need to have to determine this? Please provide hard copy examples of these in your report.

11) Explain why your chose these method/s?

12) Explain how you would present your finding to management once you had collated the feedback and data.

13) Explain how you would reflect on the planning processes to identify possible improvements for any future promotional activities.

14) Detail how you would analyse all costs and timelines related to the activity, and what benefits have come out of hosting it.

15) Discuss whom else you may gather feedback from within the organisation to find out what benefits have come out of the promotion?

Task 2: Presentation

With a maximum of three in a group, give presentation using Power Point (Submit your printout in your report) about the promotional activity for JB HiFi Limited. Please include:

• All the important relevant details that you covered in written project.
• Total duration of not more than 15 minutes
• All group members must participate in presentation to attain respective competency