Integrated Communication

Strategy
December 2015
Student Number 38459176

For Freshness and quality

Task 01 word count 1902

Task 02 word count - 3006
Task 03 word count - 3297
Total word count excluding reference and annexure- 8205
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Table of Content
Task 1
Task 1.A Organization background and culture .03
Task 1.B How the Arpico Super Center culture has influenced the internal communication methods .04
Task 1.C Organizational resource allocation for internal and external communication.....04
Task 1.D Ways to assess the effectiveness in internal communication..05

Task 2
Task 2 .A Key characteristic of the chosen organizations brand and how these contribute to deliver customer value..06
Task 2 .B Process of developing creative brief with emphasize of customer value ..07
Task 2 .C Organizations new product development process benchmarking with standard model.08
Task 2 .D Methods of brand building to increase customer loyalty to achieve competitive advantage by Arpico Super Center..09
Task 3
Task 3 .A setting up marketing communication objectives to enhance image and reputation of Arpico appropriate tools to
achieve set objectives ...10
Task 3 .B Integrated Marketing communication plan for Arpico Super Center11
Task 3 .C Relationship between internal and external stakeholders and potential barriers and issues which might arise due to
Conflict of interest..14
List of reference .16
Appendix 1..17

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1.A)Organization background and culture

1. A.1) Organization name and Industry type
Arpico super center which is subsidiary of Richard Peris group of companies has been a dominant successful retailer in Sri Lanka.
Arpico retail consist of Arpico Supercenters, Arpico Superstores, and an island wide network of Arpico Showroom (source,
https://www.arpico.com, Accessed on 09-07-2015).
Retail sector in Sri Lanka is accounted approximately between USD $ 25-30 billion industry and organized players have captured
only 3% of the market Rising living standards, changes in spending patterns towards more quality and branded products offers
greater opportunity to grow for both local companies (Jons Lang Lassall ,2013Refreshing Sri Lanka Retail Intelligence,2013)
Arpico super centers have been succeeded in gaining competitive advantage over its rivalry thru unique shopping experience it
delivers to customers. Super centers are equipped with ample of parking, ATM, Bank service points, car washing bays wider isle
space for shopping and state of art cool rooms to provide fresh products to customers.
1. A.2 Product category offers to customers
Fast moving consumer goods
General merchandise
Fashion
1. A.2)Target consumers
Arpico super center is manly focusing on consumer segment
which is affluent and middle class income from R.S. 45,000
per month to 1 Million per month which spreads
geographically in urban and suburban areas and tourist
customers who visit Sri Lanka
1. A.3) Turnover and Size of the organization
Arpico super centers and super stores operate in 17 locations
and comprise of 1600 skilled staff. Organization has
reported Rs 16.1 Billion revenue in 2014 and it is 2.5%
growth compared to the previous year and 3.6% increase in
profits. (Annual report, 2014, Richard peris group)

Furniture
Electronic

Figure 1 Annual performance Arpico super center (SourceAnnual report, 2014, loss and profits account, RPD

1. A.4) Main competitors

There is no as such large similar format competitor yet that offers the full range of product that Arpico offers however below
listed are closer competitors
Competitor
Cargills Big City
Keels super mega

Nature of the business

FMCG& general merchandise
FMCG & general merchandise

Annual Turn over

Rs. 33.6 Billion
Rs 11.7 Billion

Value proposition
Lowest Price in the Market
Best service and fresh
products
Damro super store
FMCG & general merchandise
Rs 20.7 Billion
Internationally
trusted
products
Table1 Competitor analysis - Sources (Annual reports, keels, Cargills, Damro, 2014, https://www.cse.lk/annual_reports,[on line],
accessed on 21, 08, 2015)
1. A.5) Apparel Key characteristic of the brand -Arpico retail promises that quality and the freshness are delivered at all the time;
it offers additional services such as bill payment counters, mini banks inside the mall. It is easier to navigate thru wider isle and
product categories are carefully arranged. Overall it offers delighting customer service with dedicated front office service team
headed by front office executive. Privilege card is the loyalty scheme available and it has enrolled over 300,000 customers and
offers exciting benefits such as special discount, double point promotion and many other offers to loyal customers.
1. A. 6) Organization culture Organization culture is about
how organization behaves and it is defined in terms of shared
values, traditional symbols stories (Bower M, 1966, The Will
to Manage: Corporate Success Through Programmed
Management, McGraw-Hill). Richard Peris Distributors
possess traditional top to bottom operating management
system however it has few characteristic which has helped to
achieve and sustain market leadership in hyper market
concept. All staff is very attentive to detail and emphasize of
outcome especially front liner staff who strive to deliver

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moment of truth. Arpico has built up aggressiveness within

the retail team in order to deliver exceptional shopping
experience to consumers. Dress code is very formal which is
symbol and retail team is motived through various
recognition schemes such as employee of the month,
manager of the quarter and program is backed by substantial
financial rewards which is a part of control culture. Cross
functional team and operational team work collaboratively
and dedicated manner to deliver quality product at a lower
price and on the right time to satisfy.

1. B) How the Arpico Super center culture has influenced the role of internal communication and methods
Stacey (2003) defines organizational culture as a set of beliefs, customers, practices, and ways of thinking that they have come to
share with each other through being and working together.
Cultural web, developed by Gerry Johnson and Kevan Scholes (1992), provides one such approach for looking at and changing
organizations culture. Using it Richard peris Pvt Ltd can expose cultural assumptions and practices.
Cultural web applied for Arpico Super Center in Sri Lanka
There is an analysis of `Arpico culture and will be discussed most impacting element of the culture to the internal communication
Culture Element

Evidence

General Rating

Stories

Staff at the all the level speak about remarkable achievement of the chairmen who
was born in average family and today he owns a business conglomerate
Customer service excellency stories are shared and published

+4

Rituals &
Routines

Team briefing, Monday morning department meeting, Informal meetings and one on
one chats, Speed culture of working among all the levels,

+4

Symbols

Plush offices, Formal dress codes and duty manager with business attire, luxury store
ambiance

+3

Organizational
structure

Hierarchical, prolonged decision making pattern, Top bottom approach

+2

Power Structure

Most influential personalities are the one who closer to chairmen and decision were
overridden by them

-2

+5
Control systems
Strict audit and control systems, Stronger financial and inventory control methods
Table 2 Cultural web analyses at Arpico super Center (Prageeth, Operations manager, Richard peris distributors, interviewed on
03-09-2015).

Most influential cultural element in the internal communication is rituals and routine. Retail is dynamic and possesses fast
changing the characteristic. Speed information dissemination is extremely important in dealing with day to day issues. Sense of
urgency is critical to run successful retail business to deliver results on time not at the any time. Quick team briefing may take
place at any point of the time at any places in formal or informal manner to disseminate information and arrive to quick decisions.
Quick team briefing may have different forms such as quick chats on the managers office, team discussion in supervisor desk or
even on the shop floor with couple of department staff. The purpose is to expedite decision making, Disseminate information,
execute immediate instruction or to take feedback that cant be postponed even an hour. Speed culture and quick team briefings
are prevailed commonly at Arpico super center and it is a ritual and routine task that managers, supervisors and team leaders has
to execute. ( Prageeth, Operations manager, Richard peris distributors, interviewed on 03-09-2015)
1. C) Organization resource allocation for internal and external communication
There are four types resources available in an organization as below
Physical resources
Financial resources
Human resources
Intangible resources
(Source; CIM, IC, text book, managing internal resources to deliver effective external marketing solutions,)
Allocation of organizational resources for internal and external communication explained in the chart
Criteria

Internal

Physical resources

Training Room, Conference room, Store meeting

space, Intranet, In house Magazine

Human Resources

Financial resources

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Dedicated staff training manager and executive

and their 100% time, Communication help desk
executive and his full working time, HR manager
10% of his time
Dedicated training and development budget,
Internal
communication
annual
resource
allocation, Reward and recognition budget and
staff welfare allocations

External
Customer help desk, Retail store space for
branding, Car park brand sinage space, Web
site, Social media space, Customer relationship
management system
Marketing Manager and Team 95% of time,
CRM manager and front office executive,
Brand and advertising Manager 100% of time
3% of revenue is approximately allotted for
marketing communication budget.

Intangible Resources

Built trust and reputation in recruitment market,

Employee branding activities as team of super
achievers at Arpico, Reward and recognition
system which is in place

Arpico brand that stands for quality and

freshness, Top of the mind retail brand
awareness, quality perception among shoppers

Table 3, Resource allocation for internal and external communication at Arpico (source, Dilip M. Manager marketing, Sudath K.,
corporate communication, Manager, discussion 30-08-2015)
1. C.1) Resource allocation for internal communication Marketing department allocate approximately 2.5% of annual budget
for internal communication such as reward ceremony, out bound trainings, IT spends time and money for internal
communication platform maintenance however amount is variable and not pre agreed. Meeting and conference room facility at
head office is used for regular meeting and trainings, Intranet and bi week magazine is used as popular tools, store
communication desk executive facilitate in coordinating communication between store and head office. Employee feedback is
addressed by HR & GM of the company. HR has allocated Rs.4.5 million for Arpico Champ employee recognition and reward
scheme. (source: Dilip M., manager, marketing)
C.2) Resources allocation for external communication- Richard Peris allotted Rs 526 Million for current financial year
marketing expenditure as per the marketing manager. Dedicated CRM support and customer help desk in the every Arpico store
is one of the important tools which competitor doesnt have. Digital marketing platforms such as e commerce supporting
website and social media plat form such as Facebook, LinkedIn, Twitter and you tube channel are supporting customer
engagement. Ambiance advertising space is valuable resource. Hardware, software and human resource allocated for CRM
which mainly focus on communicating with loyal customer base. (Source: Dilip M., manager, marketing)
Draw backs in resource allocation and internal communication

Less amount of money allotted compared to

external communication
Lack of participation and response rate from store
staff

HR manages has lower level involvement to

motivate staff and building cohesive teams
Marketing manager build brand external but no
focus on internal brand building

1. D) ways to Assess the effectiveness of internal communication

Below table will explain the tools that are used to measure the effectiveness of internal communication in Richard peris Ltd
Communication tool
Expected out come
measuring tool
Number of Managers attended,
Disseminating important massages and policies,
How many store team meeting took
Passing down new instruction to store teams for
Management meeting
place afterwards
implementation, Feedback sessions and results
Confirmation mails upon
discussion and POA to achieve targets
implementation of task
Number of intranet portal open a day
Number of clicks for links particular
Sharing ideas, thoughts and bench mark
massage areas
practices.
Intranet communication
Staff review and forum engagement to
Update employees about latest development
discuss topics
Motivate team and share best service stories
How many downloaded PDF and
Podcast
Disseminate information and coordinate
Reply mails received on time
Communication desk
communication,
Phone calls received for confirmation
communication
Ensure task are implemented
Confirmation mails for implementation
Sharing information, Thoughts, stories and new
Number of inquiries received
Bi weekly magazine
development
regarding specific communication
Service skill development, Customer engaging
Random visits and check by trainers
techniques, Soft skill and job knowledge
Job skill development training
Mystery shopper survey results
development
Superior assessment and feedback
Provide ideas to improve business, staff
Number of mails received in total
grievance, Divulge any harmful activities to the
Percentage of staff who used the
organization in confidential manner
facility
Suggestion and feedback Mail

Staff events and award ceremony

Recognize best performers, reward and motivate

Satisfaction measuring survey

Thumps or hand raised on agreement

Table 4 tools that assess the effectiveness of internal communication (source: Institute of internal communication, Guide to
evaluate internal communication, 2012, UK, www.ioic.org.uk/assets/pdfs/ioicmeasurementguide.pdf, [accessed on 03-09-15],
Sudath k., Manager corporate communication interviewed on 05-09-2015]

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2. A). Key characteristic of the chosen organizations brand and how these contribute to deliver customer value
Kotler, Armstrong, (2013, P203) states that Brand represents customers perception and feeling about a product and its
performance. The real value of a strong brand is its power to capture consumer preference and loyalty
.
The relationship between brand characteristic and customer value is that Product or service attributes leads to consumer
benefits and eventually benefits leads to customer values.
Davis (1992) six brand role elements and Aker (1996) brand equity model will be used to explain key brand characteristics and
how these characteristic deliver customer value for Arpico customers
Six brands roles and elements
Differentiation
Recognition
Davis 1992, cited in, IC, CIM course book

Register able Name

Transferability

Physical value
Premium

Another model that Arpico can use to describe key characteristic of the brand is the consumer brand equity model
Awarness
deep awarness
broad awanrness

Performance/
percieved quality
attributes, benifits
style, price
quality, superiority

Other assests
distribution
saelf space
patent and trademark

Brand
equity

imagery/feeling
user image
usage imagery
Brand personalty
brand feelings
Brand loyalty
price premium
satisfaction/ Loyelty
Market share

2. A.1) Performance/ Perceived quality Performance

refers to the extent which product meets the customers
utilitarian, aesthetic and economics needs and wants
Arpico Super center delivers quality and freshness mainly
in their perishable product. Arpico has built up state of art
modern chiller rooms to maintain freshness. They set up
systems such as just in time delivery (JIT) in which products
are delivered directly from the farm to the store , so
Consumer can have healthy, fresh, nutritious product. In
addition to this Arpico provide friendly customer service
and there is a uniformity of service across all the outlets.
Eventually consumers can have fresh, nutritious, quality
products receive a better service from well trained staff and
consumer will get the Feel good factor
(Source Prageeth C., Operations manager, Arpico Super
Center, Interviewed on 13-09-2015)

Figure 2 components of Brand equity

Source Aker D.A, 1996 cited in, Pelsmacker et al, 2013
2.A.2 Imagery/ feeling Pelsemacker, (2013, P55) refers to how well the brands fulfill consumers psychological and social
needs.as far as User image is concerned, Consumers who shops at Arpico as seen as very sensitive, quality concerned, sincere
shoppers. Brand personality which Arpico reflects is responsibility, down to earth and stable. Customer receives end value of feel
good about themselves and responsible towards their families for good living. Arpico has priced some products such as their
organic range clearly higher than competition and charge price premium for image and feeling.
2. A.3 Brand Loyalty Pelsemacker, (2013, P57) stated that Real company assets is brand loyalty not the brand itself.
Customer loyalty is cost saving strategy since they become ambassadors to the brand. Increased customer satisfaction results,
decreased customer complained and increased turnover justify the loyalty level of customers. Reward and loyalty system which is
named as Privilege card and data mining records shows that Arpico has got frequent shopper rate of 29%. Customers are
rewarded through loyalty scheme such as extra points on certain product categories, instant redeem facility. Data mining teams do
bigger job in providing key consumer data to management to build relationship with customer. It is evident that customers are
loyal since they get bundle of benefits such as early discount notification via SMS, Double points are added to loyalty card for
some products, and higher patronizing customers are recognized through gold card, anniversary offers and birthday cards.
2.A.4 Recognition Brand recognition helps consumers to find out and distinguish Arpico from other competitors and brand
reduce the perceived risk by providing the attributes of quality hygiene and freshness, Arpico promises a certain level of freshness
and quality to shoppers
In addition to this below factors also contribute the Arpico brand value in delivering customer value
prominent location and bigger car park provides easy access and customer convenience, wider aisles and clear navigation boards

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provides customer comfort and ease of shopping, Trained and cheerful staff provide warmness and happiness in the mind of
shopper [source: Ashley H., Brand manager, Arpico super center, interviewed on 13-10-2013]
Conclusion Brand attributes and characteristic provides consumer benefits which will eventually leads to customer value. In the
context of Arpico as a retailer provides customer value and gains competitive advantage over competitors
Task 2.B Process of developing creative brief with emphasis of customer value
Developing creative brief process starts with developing creative idea and creative idea can be defined as original and
imaginative thought designed to produce goal-directed and problem solving advertisements and commercials ( source : Pelmeker,
geuens, Bergh, 2015, marketing communication )
Developing a creative brief involves several parties with Arpico super center such as advertising agency, Lanka marketing
research bureau. Developing creative brief is one of the most important elements implementing marketing campaign. A good brief
leads to effective marketing campaign. (Source: Dilip M., Manager Marketing, Interviewed on 06-10-15)
The advertiser must give the agency a creative brief. The necessary elements of a creative brief are summarized in
Table 5
2. B.1) Back ground and overview - Arpico is one stop shopping destination which comprise
complete range of FMCG products and most of other household and domestic products, Arpico
brand stands for quality freshness and convenience, Brand offers the spacious shopping
ambiance, well trained caring and friendly staff, ample of parking and additional benefits such as
mini banking, bill payment, laundry key massage is quality freshness and convenience.

The creative brief process

The company background
The campaign Objectives
The campaign strategy

2.B.2) Objectives of the campaign - Achieve 40% top of the mind brand awareness as a retail
brand, increase face book likes to 1 million and twitter to 25000 followers by the end of 2015,
Generate 10 blog articles subjecting as preferred shopping destination of family, Increase web
based sales to 2% of total sales.

Target groups

2.B.3) Unique selling preposition - USP is quality and freshness with stop shopping
destination for customers, spacious store ambiance, Superior customer attention and service,
hassle free happy shopping journey, Value for every penny that customer pays, Home delivery
and free returns for on line purchases, which will deliver customer value

Product feature and benefits

2. B.4) Competition and competitive offerings

Cargills Big City

Unique selling preposition

Description of competitors

Desired positioning
Desired media
Table 5 the creative brief

Keels Super mega

FMCG & General

merchandise store, focus on
being the lowest priced
retailer in the market
Lowest Price in the market

FMCG & General

merchandise store focus on
offering freshness and better
prices
Fresh products and best
service
Table 6 Competitor and value proposition comparison

Damro Super store

Singer Mega

FMCG & General

merchandise store with
fashion products focus on
selling premium products
Internationally trusted
products

FMCG & General

merchandise store with
electronics focus on
providing superior service
Trusted excellence

2.B.5) Desired positioning Arpico has been positioned as brand that stand for quality, freshness and customer convenience
since the brand positioning is correct and same position will continue. However rational advertisement campaign which reflects
the slice of life of should be appealed A happy family does their shopping in a well-kept, illuminated, spacious store and
choosing just fresh products served by staff who are cheerful . In contrast with competition Arpico strive to delight customers
through product quality and service not the lowest price but the value for money and this will demonstrate through the
advertisement campaign. Advertisement campaign should consist of testimonial features which demonstrate how good the product
available, Level of superior service received so that consumers will get convinced to start shopping. Campaign should more focus
on digital Medias and less on traditional Medias to improve customer engagement and interactivity to provide customer value
2. B.6) Product features and benefits- One stop shopping destination and Arpico housed with FMCG, General merchandising,
Fashion, furniture and consumer electronics. Arpico super centers has located in prime commercial places with ample of parking
space, possess additional features such as mini banks. Laundry, Dinning restaurant, car washing bays, these facilities provides
costumer value through conveniences, ease of shopping, feel good factor.
2. B.7) Key information derived from market research consumption. Sri Lankas domestic consumption is at the

nascent stage and the increase in disposable income is expected to make domestic consumption surge over the coming
years, per captain income is expected to rise to USD 4,000 by 2016 and consumer spending is higher than other Asian
countries. Arpico holds 14.7% market share being second in the market to Cargills which has 19.1% market share.

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Arpico can increase luxury and quality product range to match with increased customer disposable income and can
expand branch network further to provide location convenient.
Task 2 C) Organizations new product development process benchmarking with standards model
New products are the lifeblood of a company. As old product mature and fade away, company must develop new ones to take
their place Kotler et al, (2013, P 222)
Idea
Genaration

Idea
Screening

Concept
development
& testing

Marketing
strategy
development

Business
analysis

Product
development

Test
Marketing

Comercializa
tion

Figure 3 major stages in New Product Development (Source - Kotler et al, 2013)
Arpico as a retailer develop many private label brands to compete the reputed international and local brands after careful
analysis of category performance and customer requirements.
Arpico possess manufacturing facility to manufacture certain products and Arpico outsource to manufacture some products for
reputed manufacturers or to subsidiaries of Arpico group of companies and sold under Arpico private label.
Spices and condiments

Cleaning aids

Rubber products

Kitchen ware

Jam & Cordial

Arpico private label

spice varieties such as
chilly, cinnamon
power. ETC

Arpico branded Dish

wash bars, Soaps, Tile
cleaners, ETC

Arpico Branded Rubbe

gloves, Mats, Tire
tubes, ETC

Arpico branded Table

mats, cutleries, ETC

Arpico Branded fruit

jams, No sugar jams,
Fruit cordials

Table 7 NPD categories (Source Sheron M, Manager Private Label development, Arpico, discussion on 13-10-2015)
NPD Development process at Arpico
Arpico has a dedicated new product development (NPD) committee headed by private label development manager and
members include Operation manager, Marketing manager, Finance manager, Production manager, senior store managers,
coordinator and executives represent various department.

Idea generation - Idea generation internally takes place at Arpico in many different ways which are staff suggestions,
Brain storming sessions and customer suggestion and feedback and NPD committee analyses category performance to
assess category attractive in many ways . Number of SKUs (stock keeping units) in a given category, product sell thru
rates, as well as average GP (Gross Profit) Margins of the category, competitive in the category are analyzed to generate
ideas. Arpico uses ERP system and some analytical tools to prepare these.
Idea Screening- there is a standards format to be filled prior to the review starts. This includes estimated market and
category share, expected price, Margins, Cost, and Expected positioning of the product, Number of product presently
available of the same product category and comparison of them.in this stage idea is critically evaluated and business
feasibility study will be carried out to assess lucrativeness of the idea.
Concept development and testing- NPD committee will start working with selected consumer group. This stage include
listing down product specification required, developing unique features in it conceptually decide how the product looks
like and obtain consumer feedback to alter, modify and fine tune the concept in the areas of ingredients, color, size,
shape, design, packaging and uses. A prototype product in small quality will be manufactured to present to the consumer
panel and the NPD committee. This is much easier since Arpico outsourced in most cases or uses existing.
Business analysis and Marketing strategy development- Once the prototype product is passed thru the concept testing
NPD committee will start planning precise details about product positioning, expected price, which stores to carry,
marketing budget if the product is distributed to mass retail. In order to estimates sales Arpico looks at sales of similar
competitor products and sales history of the same and this becomes easier since they possess category and SKU wise
performance.
Product development This is the stage where Arpico manufacture or outsourced manufacturer manufacture few
badges of the product. However product may undergo rigorous tests to make sure they perform safely and effectively or
that consumers will find value in them compared to competitors offers.
Test Marketing - Often Arpico skip this stage however if they still do test marketing Arpico will made their new product
available in few selected stores. Arpico skips test marketing very often
Commercialization Test marketing gives the information needed to make final decision about whether to launch the
new product. If the Arpico goes ahead with commercialization then they have to rent the manufacturing facility or
outsourced it which they commonly do. Then Arpico give bigger shelf space for their new and own brand and do heavy
in store branding and promotion campaign

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Conclusion when compared with the model developed by Kotler, 2013 there are certain processes in the NPD Is skipped by
Arpico; Outsourcing manufacture process will have negative impact due to reasons such as manufacture may not meet the
quality standards, Orders may not be delivered on time, however due to increased private label brands, will increase the
profits margins and improve the brand presence in the market as well as be more independent of manufacturers of premium
brands. Arpico competes with other brands on the basis of price - Sources (Prageeth, Operations manager, Richard peris
distributors, interviewed on 22-10-2015, and Sheron M, Manager Private Label development, Arpico, discussion on 13-102015)
2. D Methods of Brand building to increase customer loyalty to achieve competitive advantage by Arpico Super Center
The American Marketing Association defines a brand as a name, term, sign, symbol or design, or combination of these,
intended to identify the goods or services of one seller or group of sellers, and to differentiate them from those of a competitor
(Cited in PR Smith, Ze zook, 2011 marketing communication, P 39).
Kotler el at, 2013 stated that brands represent customers perception and feeling about a product and its performance and a
powerful brand should be able to capture consumer preference and loyalty
2. D.1) Brand Development strategy - Arpico as a retail brand is developing its brand extensively to achieve competitive
advantage in the market. Arpico super center has extended their concept to Arpico super stores which is a midsized version,
Arpico showrooms in smaller towns and Arpico daily market which is a corner grocer type and targeting consumers who are
rushed to home and want to pick few daily essentials. This extension is helping in covering more geographical area and caters
increased volume of customer. (Source Annual report, 2014, https://www.arpico.com/contents/img/RPC%202013-14.pdf,
accessed on, 21-10-2015)
2. D.2) Introduction of Private Label Brands- For last decade under Arpico name hundreds of SKUs has been introduced in
various product categories. Detergent, Tissue and toilet papers, Spices and condiments, Sauce and Jam, Cleaning aids, Rice and
gram, dairy products, as stated table 7 Sales of these private label brands have accounted 16.6% from total FMCG revenue.
These products are cheaper compared to national brand and quality still remains same and can be bought only at Arpico stores
only. Value conscious and even quality conscious customer picks up these private label brands over national brand and customer
keeps on coming to seek these private label brand and that created distinctive competitive advantage and loyal customer base.
(Source Sheron M, Manager Private Label development, Arpico, discussion on 13-10-2015)
2. D.3) Advertising and Public relation activities- USP of Arpico super center is Quality and freshness with one stop
shopping destination and organization strives to deliver. Arpico advertisement campaigns are consistently focused on
demonstrating their effort to deliver quality and freshness as well and the other value additions offered to customers. In addition
to advertising Arpico is currently running a campaign with municipal councils Keep Clean your city project. Arpico has
donated branded trash bins to every municipality and they are kept in common place to collect litter. Generally retailers are
blamed for excessive usage of none recyclable carry bags and Arpico is striving to minimize negative image with Keep Clean
your city. This generates free publicity and positive customer perception and loyalty among environment friendly shoppers.
2. D.4) Building and developing brand by user experience- A brand experience can be defined as sensations, feelings,
cognitions, and behavioral responses evoked by brand-related stimuli that are part of a brands design and identity, packaging,
communications, and environments ( De. Pelsmacker et al, 2013) Arpico is a retailer who constantly make every effort to deliver
moment of truth and Arpico believes that managing customer experience is perhaps most important way of building brand loyalty.
Arpico focus on every customer touch point where customer interacts with staff starting at the car park, Ample of parking space
which offers the convenient and staff greets every customer walks in, shopping environment is not cluttered and easy to find the
product since clearly defined product categories and direction sign boards. Arpico ensures customer enjoys customer service,
quality product and additional benefits during his shopping and has no reason to shop elsewhere and Arpico has benchmark in the
retail industry in their best service.
2. D.5) Employee Branding and training- Arpico consider the wellbeing of the team and takes effort in motivating teams and
the stores and management spend lots of time and resources in building these cohesive teams. Careful staff selection and
recruitment practices are available at Arpico and the newly joint staffs are trained well prior to start working. Management
ensures that customer interface staff is recognized and rewarded thru monthly and annually for their outstanding service.
Organization has developed serviced oriented culture across the organization. Well trained, well paid and happy staff could
certainly make their shoppers happy and potential employees are waiting and are a part of Arpico team.
2. D.6) Loyalty scheme - Arpico has named its loyalty scheme as Privilege in which customer could earn loyalty points on
what they spend and can be redeemed at any point of time. Customer can start with Bronze and move to gold membership level
based on monthly average shopping expenditure. Card holders may get rewarded through various schemes such as foreign tours
(Source: Kotler P., et al, Principals of marketing, 2013,Pelsmacker, et al, Marketing communication 2013, Anil K, Manager
Brand, Arpico super center, Interviewed on 11-11-2015)

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3. A) Setting up Marketing communication objectives to enhance image and reputation of Arpico and selecting appropriate
communication tools to achieve set objectives.
Prior to set objectives it is important to understand reputation and image
Corporate image is the stakeholders perception of the way and
organization present itself. It is the result of interaction of all
experiences, beliefs, feelings and impression of each
stakeholder about an organization. It is the subjective and
multidimensional impression of organization. The corporate
identity resides in the organization but the corporate image
resides in the heads of stakeholders.
(Source-Pelsmacker, Geuens, Burg, 2013, P20)

Corporate reputation is the evaluation or esteem in which an

organizations image is held. It is bases on experience/or
exposure to communications, behavior and symbolism.
Corporate reputation implies credibility, trustworthiness,
reliability and responsibility.
(Source-Pelsmacker, Geuens, Burg, 2013, P20)

There are three platforms to build corporate image and reputation

Activity Theme- Try to build reputation around key activities or business they are involved in
Benefits theme- Emphasize the attractive outcome or benefits that stakeholder should expect from companys activities
as a way of inspiring allegiance.
Emotional theme emotional theme to inspire stakeholders
(Source Fomrun J and Riel V, (2007), essentials of corporate communication, 1st pubish, New York, Routledge,)
Marketing communication objectives of Arpico Super Center will be based on benefit theme since this will suit for
retailer and will be able to achieve DRIP, Differentiation, Remind, Inform, and Persuade. (DRIP Model, fill, 2013),
Benefit theme will certainly support in achieving competitive advantage.
Evaluate organizational objectives and recommending most suitable communication objectives
Present Objectives at Arpico Super Center
Recommended Marketing Objectives for next financial year
To achieve staff attrition rate of 20% a year by the end of
To be shortlisted in LMD magazine top 10 companies to
2015.
work and achieve staff attrition rate of 17% by the end of
2016
To Achieve top of the mind awareness 20% as a retail
To Achieve top of the mind awareness 25% in Urban and
brand by the end of 2015
Sub urban areas as a retail brand by the end of 2016
Build up regular Loyal customer base of 1.6 Million by the Increase customer retention by 30% by the end of the 2016
end of 2015
To achieve 8% growth in customer footfall during the year To improve cumulative fool fall by 12% for the 2016
of 2015
compared to current financial year
To achieve 12% consumer perception of being ethical and
To add new 1.5 Million social media active users and
socially responsible company by the end of 2015
generate 3% of sales in amount Rs 600 Million from E
( Source- Dayan, Manager Marketing, Arpico Super
commerce plat form.
center, Interviewed on 30-08-2015)
Table 8 Present Marketing communications objectives and proposed objectives
New objectives have been recommended considering the social medial and digital marketing opportunities available in
the market. Arpico Super Center has to improve social media presence and customer engagement which will certainly
help interacting customers as well as building e commerce business. Labor market reputation an employee satisfaction is
a key part of organization reputation since misfit between perception of employees and desired corporate identity may
there for lead to an undesirable image gap. Therefore new set of objectives has been recommended and marketing
communication planning will be evolved on newly set objectives
Discussed below is identify appropriate communication tools to enhance organizational reputation based on
Diagram 1 Overlap between marketing and organizational communication
Recommended Marketing Objectives
1) To be shortlisted in LMD magazine
top 10 companies to work and achieve
staff attrition rate of 17% by the end of
2016

Communication tools to achieve the objective

Tools available to achieve best company to work status and internal
employee happiness are Annual award ceremony, Intranet, Staff
meetings, Informal meeting with managers, Employee feedback and
employee branding programs. Constant interaction between managers and
staff will help in building cohesive teams and reduce conflict of interest

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December 2015

To Achieve top of the mind awareness

25% in Urban and Sub urban areas as a
retail brand by the end of 2016

Increase customer retention by 30% by

the end of the 2016

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Advertising On TV, Radio, Press and digital media would assist to

achieve top of the mind awareness. TV advertisement is the most suitable
since it has high reach and low cost per contact, Creative opportunity and
segmentation possibilities through program choices. Celebrity (Kumar
Sangakkara ) endorsement with appeal of humor and warmth would create
strong sense of awareness, Radio will Remind and press advertisements will
provide details. CSR and Sponsorship activities
CRM customer relationship management program which is branded as
privilege is one of the key tool in achieving customer retention. As per
pelsmacker, Loyalty Pyramid, 2013 a customer should move from switches
to committed buyer. Digital media such as Mobile App, E mailer,
Facebook. Twitter, Linkidin will be used to communicate constantly about
new product arrival and offers. Loyalty data base need to be utilized for data
mining and customized communication with loyal customer base. CSR
activities such as city cleaning,
Sales Promotion can be used to attract shoppers however this need to be
combine with Advertising off line and on line media. Sales promotion will
trigger spontaneous footfall.
Arpico retail website will facilitate for E commerce transaction and
purchasing intention could be triggered via social media activities

To improve cumulative fool fall by 12%

for the
2016 compared to current
financial year
To add new 1.5 Million social media
active users and generate 3% of sales in
amount Rs 600 Million from E
commerce plat form
Table 9 Marketing objectives and communication tools

Diagram 1 Overlap between marketing and organizational communication (Van Riel and Fombrun 2007).
3. B) In order to achieve above stated marketing objectives which improves organization image and reputation, Arpico has to
develop an integrated marketing communication plan. Marketing plan has to be integrated due to factors such as broader nature
of objectives; geographically spread customer base and the intense competition in the industry.
Integrated Marketing communication is a Process through which organization and audience engage one another. Through an
understanding of audiences preferred communication environments, Participant seeks to develop and present massages, before
evaluating and acting upon my response (Fill C,Marketing communications: brands, experience and participation, 6th edition,
harlow, pearson, 2013).
Integrated marketing communication very powerful, Persuasive and consistent in delivering massage to stake holder group,
There are few models available for integrated marketing communication plan preparation such as SOSTAC by PR smith and Ze
Zook 2003, RABOSTIC by Pickton and Broderick 2004 and MCPF by fill 2013.
SOSTAC and 3Ms model of PR smith and Ze Zook has been chosen to develop integrated Marketing Communication since the
model provide simple approach for building a comprehensive marketing plan.
Situation
Analysis

Controle

objectives

Actions

Strategies

Men

Money

Minutes

Tactics

Diagram 4 SOSTAC and 3M planning from work (Source PR smith, Ze Zook, 2011, Marketing communication, USA)

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B.1 Situational Analysis Where we are now

SOSTAC marketing communication plan will start with the situation analysis as below
Performance Review

2014 financial year performance

Sales

16,120,000,000

Loyal Customer Base

310,000

Profit

1,160,640,000

AVG basket value

Rs. 2481

Market share

14.70%
526,000,000

Conversation rate

39%

Net profit Margin

7.20%

Communication Budget
Table 10 (Source annual report, 2014, Richard peris)

Most successful media campaign - BUY WHAT YOU WANT NOT WHAT YOU GET communicating wider
selection available at the store which is competitive advantage. Arpico endorse sportsmen and few celebrities to
communicate massage strongly to the public. Kumara sangakkara who is a world famous cricketer appears throughout
their advertising campaign as opinion former. Sunil Perera who is well respected and famous singer is appearing in the
advertisement campaign.
Business tie ups - Arpico tied up with Standards Chartered Bank to provide co-branded credit card which can be used to
accumulate and redeem loyalty points as well.
Employee Branding - Arpico has built favorable image in the employment market and staff attrition rate is 24% which
is lowest among the competitors.
SWOT analysis Appendix 01
Strengths
Well established Brand Name
Prime Store Locations
Existing Loyalty Scheme
Only hyper market format
Opportunities
Consumer changes in spending patterns
Increased usage of digital technology
Boost in tourism industry

Weakness
Absence of MKIS system
Unavailable of data mining techniques
Higher operational overheads comparatively
Threats
New international retailers about to start business
Customer knowledge and showrooming

Value proposition - quality and freshness convenience and superior service however there is a perception among some
customers that Arpico is having marginally higher price which is wrong and must be addressed in new marketing
campaign.
Market segment People whose income between Rs 40,000 and 1,000,000, geographically located in urban and sub
urban, aged between 10-75 years, and tourist customers.
Most profitable segments are tourist customers, Customers whose income is between Rs 250,000- 1M aged 45 to 60. As
well as 12% of Gold loyalty customer base is buying 29% of products
Media consumption- TV is most consumed media followed by Radio and press, Face book, twitter, LinkedIn, you tube
has been emerging as digital media and youth is tend to spend more time on digital channel whereas older generation
consumer traditional medias
3. B.2 Objective setting where do we want to go
Marketing communication objectives has been set in task 3.A and strategies will be developed to achieve set objectives
3. B.3 Strategy How do we get there
Push strategy Encourage customers to switch their purchases from competitors to Arpico by giving product offers and
discount and retain them through providing benefits thought loyalty card. Drive customer to use on line platforms to increase
digital customer engagement and web purchases by offering on line exclusive offers. CRM platforms to be used with data
mining and data analyzing to customize communication to improve customer relationship and sales
Pull Strategy building brand using on line and off line activities, improve employees enthusiasm using internal
communication tools to build cohesive teams, satisfied staff will satisfy customers
Profile strategy CSR activities and sponsorship to enhance organization reputation and use digital channel such as
blog article, social media pages to improve Arpico brand equity and credibility

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3. B.4 Tactics detailed planned to achieve objectives

Below table will be used to explain tactical plan and how each tactic would help to achieve objectives stated in task 3.A
Marketing Tactics
Key Objective to achieve
Recruit e marketing manager and 3 executives to launch e
To add new 1.5 Million social media
commerce web site
active users and generate 3% of sales in
Recruit Digital marketing executive to handle digital media
amount Rs 600 Million from E commerce
functions such as Facebook, Twitter
plat form.
Initiate affiliate marketing, Digital banners and skyscrapers
Search engine optimization.
City cleaning project with municipal council and provide bins to
To Achieve top of the mind awareness
keep city cleaned
25% in Urban and Sub urban areas as a
Donate money for cancer hospital to buy surgery equipment
retail brand by the end of 2016
gain free editorial space and free news articles
TV, Radio and press Advertisement
Recruit data mining executives
Start data mining and customized communication using digital
media such as e mail
Increase customer retention by 30% by the
launch of mobile application
end of the 2016
Market survey to assess customer satisfaction level
Provide web facility to enroll customer for loyalty card, provide
facility to check points on line.
Discounting products in FMCG, General merchandise, Fashion
To improve cumulative fool fall by 12%
and electronic
for the 2016 compared to current
give bundle offers and value packs to customers
financial year
advertise on TV, Radio and Press about sales promotion
Table11 tactics to achieve proposed objectives
3. B.5 Actions
Below table consist of action plan and the person who is responsible in implementing each task with the deadlines

Web Redesign and

increase visits and
sales
Increase social
media engagement

Sales Promotion to
enhance off line
and on line sales

Corporate social
responsibility
Sponsorship
Public Relation
Advertising to
increase brand
awareness, increase
footfall and sales

Tactics to achieve
objectives

Person
responsible

Launch E commerce
site
In bound links
SEO
Get blog article
published
Facebook promotion
Twitter promotion
Discount offer
Bundle offer
Enrolling new
customers for loyalty
card
Keep city clean project
Donate money to
cancer hospital
SLIM awards, Musical
events
Gain free editorial
Press release
TV

Manager E
commerce

J
a
n

F
e
b

M A
a p
r r

M J
a u
y n

J
u
l

A
u
g

S
e
p

O
ct

N
o
v

D
e
c

Budgets

1300000

Manager E
commerce and
Communication
manager
Manager
operation and
Manager Loyalty

600000
250000
500000
100000
250000
6000000
1000000
3500000
5000000
1200000

Manager
Marketing
Manager
corporate
communication

250000
5000000
1000000
0
3000000
2000000

Radio
Press

Internal
Staff communication
Manager HR
Communication to
programs, reward and
employee brand
recognition schemes
building
Table 12 Tactical tool employed by the organization to enhance organization image and reputation

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3. B.6 Control
Performance need to be monitored, measured and controlled, Arpico need to know in early stage how the campaign is
running. Therefor control system should be in place to help monitor marketing communication plan. Achievement will be
measured with objectives in regular interval to identify and rectify errors to achieve expected results.
Arpico Super Center Marketing communication campaign control mechanism
Set Objectives

Means of measurement

Frequency of
measurement
Quarterly
Quarterly

1) To be shortlisted in LMD
magazine top 10 companies to
work and achieve staff attrition rate
of 17% by the end of 2016

Accountability

Actions

Employee attrition rates

Actions to be
taken if
Competitor ratings
HR Manager and
serious
Employee satisfaction
HR Executives
Bi Annually
variance
survey
found
Employee feedback review
Monthly
2.To Achieve top of the mind
On line and telephone
awareness 25% in Urban and Sub
surveys
Marketing
Quarterly
urban areas as a retail brand by the
manager
Aided and unaided brand
end of 2016
recall test
3.Increase customer retention by
Track thru loyalty car
CRM Manager
Quarterly
30% by the end of the 2016
purchasing records
Data mining and analyzing
Monthly
CRM executive
4.To improve cumulative fool fall
Footfall tracking
Store Manager &
Daily and cumulative
by 12% for the 2016 compared to
mechanism available at
Operation
report monthly
current financial year
the Super Centers
Manager
5.To add new 1.5 Million social
Facebook Members
Digital Marketing
media active users and generate 3%
executive
Twitter followers
Weekly
of sales in amount Rs 600 Million
Google plus members
from E commerce plat form
LinkedIn connections
Table 13 Marketing communication campaign control mechanism (source, pelsmacker et el, Marketing communication, 2013, UK
Measuring and evaluating the effectives of the marketing communication plan
Tools stated in the below chard would support assessing the effectiveness of the marketing communication
Communication tools
Web & E Commerce

Evaluation criteria
On line conversion rate, Bounce rates, Google analytics, dwell time, Basket value, sales, how they
arrive to Arpico web site
Members, flowers and subscription for each platform, number of sharing, likes comments

Social media
performance
CSR ( clean city
Free media coverage, changes in perception and attitude, Free editorial, Free TV air time
project
Sponsorship ( SLIM
Number of people attended for the event, No of reaches, Number of paper article, TV & Radio free
awards, music event)
air time minutes,
Public relations
Changes on opinion and attitude, Value of free media space gained, changes in perception
Internal
Degree of employee happiness, Staff attrition rates, Level of motivation, number of complains
communication
Advertising
Top of the mind awareness, aided and unaided recall, changes in attitude, sales growth
Table 14 measuring effectiveness of the plan (source, Pelsmacker et al, Marketing communication, 2013, UK)
2.

C) Relationship between internal and external stakeholders and potential barriers and issues which might arise
due to Conflict of interest
According to freeman (1984) the tem of stake holder can be defined as any group or individual that can affect or
affected by achievement of the organization. (Freeman, 1984, cited in Dr luck, 2008), CIM course book defines stake
holders as groups have vested interest in the outcome of the firms activities and will be affected by its results. (IC, CIM
course book, p7)

Figure 4 wider stake holder audience ( source Dr Diana Luck, 2008, AME, Official CIM course book

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Relationship between various stake holders are seen in the figure 4 and author will consider about how the marketing
communication plan will meet the needs of these different stake holders
Ways in which Arpico super center meets the needs of various stake holders
In order to gain a reputation as best working organization has to treat employees by providing competitive salary packages,
resolving employee grievances, training and development, enjoyable working culture, reward ceremonies, continuous feedback
sessions with staff, regular

Happy
Employees

Happy
customers

As explained in the Figure 5 happy and motivated staff will

delight the customers by providing superior services and
delighted customers will spend more and stay loyal as a
result of this organization profitability will increase

Happy
shareholders

Figure 5 employee, customer, and shareholder relationship

Customer needs for convenience will be fulfilled by launching e commerce platform. Once the e commerce platform is
launched customer can browse, choose and order via on line and product will be delivered to home and it will help for time
poor money rich customers. Consumer will have a chance of engaging with Arpico through the mobile application and social
media so if customer has got any concern or complain can be forwarded via digital media and sorted immediately.
Government and Local communities need will be met through city cleaning project Arpico will closely work with
municipal councils by donating trash bins and providing funds so local community and government will be happy with the
effort made by Arpico to the society where it operates.
Needs of shareholders will be met through improved profitability and corporate reputation. Arpico has developed strategies to
retain customers through loyalty programs, improving customer footfall through sales promotion and improve public image
through CSR and sponsorship. Eventually these activities leads to improve customer awareness, generate sales, improve
profitability and higher dividend payment for share holders
Conflicting interest between stakeholder groups
There is a considerable potential for conflict of interest between the stakeholders group. In order to achieve labor market
reputation organization has to increase financial expenditure; management has to spend their time on employees for coaching,
counseling, training and analyzing feedback. These activities may reduce profits and dividend payments in short run and
shareholders may seriously concern about ROI (Return on Investment). If shareholders continued to receive lower dividend
they may tend to sell shares and as a result share market price will fall and attracting investment may be difficult.
CSR and sponsorship is key tool that can be used to keep government, environmental groups and local community happy
however these activities incur significant cost and may impact once again on profitability, profit share payment to
shareholders.
Sales promotion will delight customers not the shareholders. Sales promotion will increase the sales volume however this will
reduce profitability and margins and eventually long run discount campaign will impact negatively on bottom line and
shareholders will not be happy.
Below table will explain stakeholder interest and situation where conflict may arise when marketing communication plan is
implemented
Communication tactics
Sales promotion
CSR and Sponsorship

Meeting Stakeholder needs

Customer will be happy to buy products at a
lower price
Beneficiaries such as local community
government will be pleased

E commerce activities

Customers will be happy since they can buy

products on line and shareholders will be happy
since sales and profitability goes up
Table 15 Stakeholder interest and conflict

15

Conflict of interest
Lower profitability will impact negatively
on shareholders interest
Additional expensed may reduce
profitability and marketing department staff
will be overworked to carry out prolonged
CSR activities
Marketing department staff has to undergo
through rigorous training and there will be
additional workload on them

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List of reference

Dr Diana Luck, 2008, assessing the marketing environment, Offical CIM course book
Criss fill, 2009 Marketing communication interactivity, communities and content, 5th edition, prentice hall, England
Kotler P, et al, (2013), principals of marketing, 13th edition, India, pearson
Fomrun J and Riel V, (2007), essentials of corporate communication, 1st pubish, New York, Routledge
Fill C,Marketing communications: brands, experience and participation, 2013, 6th edition, harlow, pearson,
Smith PR Ze Zook, 2011, Marketing communication integrating offline and online with social media, 5th edition,
koganpage, Delhi
Pelsmacker P.D, et al,2013, Marketing communication European perspective, 5th edition, PEARSON, England
CIM, Integrated communication, course book
Jons Lang Lassall, 2013, Refreshing Sri Lanka Retail Intelligence,www.jll.com.lk/sri-lanka/engb/Research/refreshingly-sri-lanka.pdf, [accessed on 20, 08, 2015]
Annual reports, keels, Cargills, Damro, 2014, https://www.cse.lk/annual_reports,[on line], accessed on 21, 08, 2015)
Annual report, 2014, Richard peris group, https://www.arpico.com/contents/img/RPC%202013-14.pdf [ accesses on
13-10-2015]
http://www.emarketer.com/, [ on line], ( accessed on 30-09-2015)
Management Discussion at Arpco Super Center Pvt Ltd
Sheron M, Manager Private Label development, Arpico super center, discussion on 13-10-2015
Prageeth,, Operations manager, Arpico super center , interviewed on 03-09-2015
Anil K, Manager Brand, Arpico super center, Interviewed on 11-11-2015
Shehan H. Customer relations & corporate communication manager discussion 30-08-2015
M.K. Dilip, manager, marketing, Arpico super center, Interviewed on 09-11-2015

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Annexure 1
SWOT analysis
Strength
1. Strong and well build brand over decades,
2 store locations are prime commercial hubs with multiple road access and ample of parking, Additional service such as Mini banks,
Bill Payments counters, Laundry, Kids play area and variety of dining options inside store,
3. Existing loyalty scheme,
4. Well trained and performing staff members who possess inherent attributes of customer service
5. Currently Arpico is the only hyper market model available in Sri Lanka
6. Widest product category which exceeds 50,000

Weakness
1. Higher overheads in operation,
2. Absence of MKIS system,
3. Relatively aged people sitting in higher management and they are very change resistive employees.
4. Unavailability of data mining and data analysis to improve CRM activities
Opportunities
1. GDP growth of 7%.
2. Newly appointed government that focus on huge economic turn around
3. FDIs (foreign direct investments) are increasing,
4. Consumer spending patterns are changing in favor of retailers,
5.emergence of digital technology and changing consumer media habits such as free WIFI availability, high smart phone penetration,
cheaper data planning available to customers,
6. increased social media consumption,
7. infra-structure development and business development oriented annual government expenses,
8. Increased number of tourist arrival is key opportunities.
Threats
1.
2.
3.

Emergence of competition due to liberalized and deregulated finance market and business friendly policies,
increasing customer knowledge and shorooming opportunities which enable consumers to compare prices spontaneously,
Increased over head such as electricity, labor. Increase road traffic may discourage store shopping but may encourage on line
shopping.

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