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.
