FREE ESSAY ON SOPHIA'S RESTURANT

SOPHIA'S RESTURANT

Overview
At the age of 24, Sue Koenig launched Runners World retail shoe store. Well known and
nationally ranked as a runner herself, Sue knew first hand of the need for athletic shoes
uniquely designed for the serious runner. Her timing was perfect. Word-of-mouth spread
and Runners World developed a good base of loyal and repeat customers. A national health
and exercise craze further fueled the demand for high-end quality running shoes. This was
a boon to early success, and resulted in a steady and profitable growth during the first
ten years of operation.
Sue had exclusively chosen Nike's premier line of running shoes as the cornerstone of
Runners World retail product line. For a time, Nike's strong image and aggressive
promotion campaign proved to be a very wise and solid marketing strategy. However, a
number of factors have begun to adversely affect Runners World's performance. Company
growth has come to a virtual standstill as recent sales have flattened out. Profit levels
remain reasonable but could weaken if some immediate and possibly drastic changes are not
incorporated. Competition, fashion and a wide spread loss of interest in running have cut
into the niche market share Runners World once solely enjoyed. This has Sue concerned
about what to do.
When Sue initially started Runners World, she had a very specific target market in mind -
the serious jogger or runner who wanted the best quality running shoes money could buy.
Things were simple and straight forward, but now the demand and climate is changing.
Customer choices, expectations and needs have expanded. There are many alternatives that
Sue needs to carefully investigate and explore. Fundamentally, Sue must seriously
evaluate whether there is still a large enough market locally for her particular
inventory.
Present Strategy
In her heart, Sue knows that her mission is sound - to provide high-end running shoes to
those who share her passion for the sport. There is no question that she reaches her
target market. Her clientele, consisting of the most serious runners, are repeat buyers
who turn running shoes into a staple. They find a shoe they like and stick with it. The
high-end Nikes she currently sells were always well accepted and seen as top quality.
Feeling that change is inevitable if she wants to stay competitive, Sue knows it is
necessary to reconsider the business strategy of her marketing mix.
Although compelled to price her inventory in line with Nike, Sue is still able to sell
the shoes and get a $5 to $7 per pair premium. This has resulted in attractive profits
overall while still remaining competitive in the market.
As trends go, Sue is aware that running is on the decline. Nike running shoes are still
her primary product, but as exercising turned to a kinder, gentler phase, Sue added a
secondary inventory to her store. Hoping to capture a more diverse market, Runners World
added Nike shoes for walking, aerobics, basketball, tennis, and cross training. These
sold well for a while but sales for these other shoes have also flattened out.
Runners World desperately needs to attract new business. Comfortable at its current
location for the past twelve years, the surrounding area has become home to other retail
chains and department stores, increasing the competition in the sports shoe and apparel
market. Stores such as Foot Locker and Wal-Mart are clambering to catch up with their
rivals who have been in the business for a while and carry immense selections.
Sue's reputation as a nationally ranked runner had always been sufficient to promote
Runners World, a familiar and stable fixture in the community. More recently, she has
become painfully aware that her reputation alone won't be enough to sustain her current
market. Determined to re-establish the store as the source for her runner's needs, Sue
begins the daunting task of analyzing the strengths, weaknesses, opportunities and
threats to her business.
Conclusions
Based on our analysis of Sue's current marketing strategy and the questions we have
raised regarding Runner's World's future, we strongly urge Sue to continue to specialize
in running shoes, but to add other high-end brands other than Nike and avoid the trendy
and/or low-end brands such as Skechers (MENTION OTHER BRANDS & RESEARCH THEIR PRICES),
which would only confuse her customers.
We have several recommendations for Sue to consider in order to continue the growth of
her company and attract a new market. Sue needs to establish a web site (example:
www.runnersworld.com) to further serve the needs of her existing customers as well as
attract new customers. Her focus should be on all aspects of running --instructional
videos, classes and running clubs. While Sue's customers are browsing, promotional videos
explaining product superiority should playing on large screen televisions set up in
strategic places throughout the store. To make sure customer service is at its best, Sue
can re-train her current employees to be familiar with all the new products and services
offered by Runner's World and put her employees on a salary/commission program as
incentive to promote sales. In addition, Runner's World could sponsor local high school
track meets and 5K runs for charity. Finally, Sue should set up a customer suggestion box
and hold weekly strategy meetings with her employees to gain perspective on how effective
her strategy is, and also make sure she is meeting the needs of her customers.