A memorandum, more commonly known as a memo, is a short message or record used for internal communication in a business. Once the primary form of internal written communication, memorandums have declined in use since the introduction of email and other forms of electronic messaging; however, being able to write clear memos certainly can serve you well in writing internal business emails, as they often serve the same purpose.
SUBJECT: Marketing Strategy for Higher Profits
The market research indicates that Reed Supermarkets need to adopt a new strategy to retain its market share amid new companies. Competition in the recent years has become more intense, as other stores like Aldi and Dollar stores penetrate the market. The primary factor contributing to customers shopping at other stores is relatively high prices at Reeds. Adopting lower prices for the products will help Reeds Supermarket maintain current market share and attract new consumers. However, the strategy may have pros and cons that the company should be aware of prior to the implementation.
Reeds Supermarket must ensure the prices of all products are lowered to match the level of other outlets in the industry. According to Quelch and Carlson (2011), the main reason customers shop at other stores instead of Reed Supermarket is better prices. Lower price margin in other stores is responsible for 55 percent of the customer preference towards the competitor stores. Moreover, the same survey showed that around seventy-five percent of Reed Supermarkets consumers consider better prices to be a crucial factor for loyalty (Quelch & Carlson, 2011).
We recommend lowering the prices as such strategy will result in more satisfaction of our customers and attraction of the non-customers. The achievement of the goal will rely upon the prices of the suppliers. Therefore, it will be necessary for the supermarket to renegotiate the costs to pass the benefits to our consumers. Nevertheless, the high quality of our products should be maintained since it is the reputation of Reeds Supermarket.
|The strategy will attract more buyers.||Customers may perceive our brand as low quality.|
|The existing customers will be more satisfied with shopping with us.||If the brand is damaged, the profits might lower.|
|More customers will increase the supermarkets’ profits.||The non-customers may consider other factors and therefore fail to buy from Reed.|
|Low pricing strategy will assist the supermarket in introducing new products.||Lowering our prices might spark price wars with the competitive outlets.|
|Lower prices will help clear the old stock so that the supermarket can stock new products.||The strategy does not guarantee customer loyalty.|