Catherine Chua
Case: Pranav New York
The
Pranav New York case is a strategic problem not a financial or
marketing problem. Here are the following reason that support that it is
a strategic problem.
- · Pranav
New York was in wrong location. At first Karlo and Mark's decision to
establish their first male salon and spa in the Philippines were in
Ortigas Center in San Juan and Makati Central Business District. But
Ortigas Center and Makati Central Business District did not approve
their new venture, only Robinson Galleria. When their mentor heard about
the Robinson Galleria's approval and Karlo and Mark pursue their
venture in Robinson Galleria, Karlo and Mark had a major wrong decision
on locating their venture in Robinson Galleria. In their survey,
Robinson Galleria is a female dominant customer.
- · Even
Karlo and Mark decide to venture their first male salon and spa in
Robinson Galleria, the location inside the mall which is in 3rd floor west wing is also wrong.
- · Aside
from this, Pranav New York can change their target customers. They can
provide a female salon and spa not just male salon and spa. Because
female spend more in salon and spa than male customers.
Pranav
New York should split the salon and spa service if they really want to
concentrate or their target market is male customer. They should venture
more on salon than spa if they decide to split the two. But if they
change their target market into unisex salon, they should not split the
salon and spa.
The following are the reason why Pranav New York should split their salon and spa.
- · Spa
consumes more on rental space. Pranav New York lease a 153 square meter
for both salon and spa, while their competitor Roberto Barber Shop
occupied 75 square meters only. For me, Karlo and Mark's decision to
put-up a salon and spa is wrong. At first they should put-up a salon
only and if their business growth and improve that's the time to add
more services.
- · Spa
service has a little percentage of Pranav's sales. Base on table 7
(service offerings availment distribution/ salon vs. spa package) there
is only 4% to 7% from November to December that customers avail a spa
service.
The following are the reasons why Pranav should not split their salon and spa if they venture on both female and male:
- · Female segment spend more on hair services, such as hair color and hot oil. They are willing to pay more than male segment.
- · Female segment consumes 9.83% on foot spa alone plus the 4% to 7% of spa service by male segment.
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