1.

0 Introduction
“Odel is synonymous with fashion. It is defined by a unique identity and is a destination in
itself. It is a brand loved, followed and enjoyed by many.”

Otara Gunawardene
The concept of Odel began to take shape in 1989. It was when Otara Gunawardene started
selling clothes to her friends and family, from the boot of her own car. Although she stumbled
across the fashion retail industry quite by chance, Otara saw something only a few could see
that is the immense potential for retailing a range stylish clothing to the fashion conscious Sri
Lankan. And then it happened in 1990. It was the launch of Sri Lanka’s most innovative brand,
ODEL. The owner of this fabulous shopping venue is Ms. Otara Gunawardene, who is known
to be the very first lady entrepreneur in Sri Lanka.

Housing the latest and most fashionable trends in the country, ODEL is the most premier
shopping destination especially when it comes to clothing. It is Sri Lanka’s first and only
department store that blends the best of sophisticated and style also it offers an unrivalled
fashion and lifestyle products which elegant, cozy, casual and definitely stylish.

Besides, Odel’s mission is to provide a complete Mind Body and Soul experience with an
unparalleled selection of fashion right and lifestyle products in an environment that is enjoyable
and welcoming. And their vision is to inspire the world.

According to Odel, CEO The great thing about inspiration is that it has no limits – it allows
you to dream. These visions may start out really big or just small. Yet, choosing to do
something about your dreams can not only make you different from the rest. Being inspired to
take action allows you to make a change in a life, even if it’s one step at a time.

At Odel, they are encouraged to apply this to both their professional and personal lives.

“We inspire – Its part of our values. It’s Part of our lives.”

1
 Otara & Team

2.0 Odel’s target market and market positioning

The retail industry in Sri Lanka is growing at over 20% each year. This growth is being driven
by changes in purchasing habits and how people spend their leisure time. Branded retailers are
capable of providing consistency in service and quality that others often cannot. Odel operates
at the top end of the retail fashion market, where it has carved out a niche through a highly
focused approach. Targeted at the upper-middle and higher-income groups, Odel has
maintained its leadership position by providing a modern, world-class retail environment that
has become the standard for the South Asian region. With a wide array of products, Odel is
now Sri Lanka’s only genuine department store.

Odel has been in the retail world for 25 years and it has benchmarked its fashion and lifestyle
in the retail world. These 25 years under review has been a challenging one, as they experienced
a slowdown in the growth momentum from that of the last two years

Having grown under the leadership of its founder, the organization has realized the importance
of professional management in order to maintain and enhance the customer experience at store
level. This requires building and empowering employees throughout the organization, which
now comprises a team of 430 people. The store has also undertaken customer-satisfaction
surveys to monitor its performance.

The increased tourist influx following the three-decade old war would have a positive impact
on Odel as the company is renowned as “the tourist shopping destination in Sri Lanka”.
Recovery in the economy brought about higher consumer sentiment driven by confidence in
the market along with the reduction in unemployment. Thus with the disposable income on the
rise local consumers tend to have a higher demand towards premium quality products.

Odel’s market positioning as a premium department store is a competitive advantage with a

lower substitutability and a few number of competitors. With the expansions which are
currently carried out, Odel expands its reach and would have access to a bigger market without
dilution.

Odel initially wanted to position as the contemporary international styles but how it was
positioned in customers mind is high quality and exclusivity and sophisticated style. This is

2
mainly because they do not try to position themselves. However its current position is also an
advantage for them.

Odel values its customers, employees and its stake holders. Their values are as follows:

Serve

We all choose to serve at one time or the other - be it at home, work, school
or in a place of worship. Service can’t be mechanical. Rather, it needs faith,
passion and dedication as its driving force. By incorporating these into your
worldview, serving takes on a whole new meaning. Most importantly, it allows
you to give yourself in the best way you can ever dream of - with joy.

Inspire

We believe that every customer that walks in through our doors will be
inspired with what we have to offer. Because we have style in everything we
do.

Friendly

We believe in being genuine, warm, receptive and accommodative to all our

stake holders.

Innovative

We are committed to constantly looking at the latest trends and news ways
of improving the products and services we offer.

Trust

We believe that honesty, integrity and transparency in all our interactions will
earn the trust of our stakeholders.

Imagine

We put imagination to our work for the benefit of our customers, staffs and
communities.

Succeed

We succeed only when we meet and exceed the expectations of our

customers, staffs and shareholders.

3
 Source: www.odel.lk

2.1 Suggestions for improve targeting and target other segments

Odel is supposed to target all upper middle and high income earners in the country. This would
make a great advantage for Odel as it improves the customer base. Further Odel can easily
access new markets such as foreigners and locals living in overseas. But they need to introduce
some more services like gift registry where locals in abroad can send gifts through Odel. This
would make a great market. If Odel can amalgamate this with database marketing (Ex: birthday
reminders with preferred gifts list), they can improve a lot. In order to attract foreigners, they
must find out foreigners first touch points of Sri Lanka and market their and to talk about
tradition and promote traditional values for foreigners.

3.0 Competitors and the sustainable competitive advantage

ODEL PLC (ODEL) is an online and in-store retail company. Sri Lanka’s premiere fashion
and lifestyle store, ODEL has benchmarked the retail world in the region with its world class
quality and audacious expansion plans. The top competitors of Odel are HOUSE OF
FASHION, ROMAFOUR, Fashion Bug Pvt. Ltd and Prateek Apparels Pvt. Ltd. ODEL is not
just a retail outlet of stylish clothing, it has variety of products which can hardly find direct
competition as one place. But ODEL is mostly famous for its fashion; clothing. In that case No
limit, Fashion bug etc. are competitors. But as long as internet marketing is concerned, those
outlets will not be competitors because they do not sell online.

Thus sites like kapurka.lk and Hameedias who have online purchasing (products are somewhat
relating to the ODEL products) would be count as competitors but those sites would not be
direct competitors. What ODEL thinks is that they do not have online competition right now
but they are looking forward to and getting ready to competition from their current physical
competitors like No limit in near future.

4
3.1 How ODEL is differentiated from other competitors

ODEL’s site is breakdown according to product categories. Therefore customers can easily
check products and find quickly what they are looking for. The service of free wrapping and
gift registry is an untapped area of its customers. Thus ODEL has a competitive advantage over
others. E-certificate is also a VAS for customers. One of the main things in a site is that it
should be predictable by customers. ODEL’s site is highly predictable by customers than sites
of its competitors and its layout is also simple. According to its web administrator it has around
6000 registered customers. ODEL’s site is apparently hard to change as it is hardcode.

Thus they use Facebook as an alternative blog for them. ODEL Facebook has 7349 fans as of
13th of June 2009. This is also a good method to market and improve their relationship with
customers though it is not connected to the site directly. ODEL newsletters are also a good
mechanism for keeping customers up-to-date and enthusiastic.

5
3.2 How can they achieve their competitive advantage?

Competitive advantage is gained when a firm acquires attributes that allow it to perform at a
higher level than others in the same industry.

Retailers can obtain a competitive advantage by implementing value-creating strategies, not

simultaneously being implemented by any current competitor. These strategies need to be rare,
valuable, and non-substitutable.

Sustainable, competitive advantages are advantages that are not easily copied and, thus, can be
maintained over a long period of time. The competition must not be able to do it right away or
it is not sustainable. Developing a sustainable, competitive advantage requires customer
loyalty, a great location, unique merchandise, proper distribution channels, good vendor
relations, a reputation for customer service, and multiple sources of advantage.

ODEL is known by everyone and they achieved a very good brand image over the past 25
years. A strong brand image facilitates customer loyalty. ODEL prides itself on being a truly
world-class department store that offers a one-stop-shopping experience and more. Its
departments cater to every whim and fancy of the discerning shopper. Odel offers shoppers of
any age or inclination the promise of high quality. Its in-store decor has always been top-of-
the-line. It invests in the best merchandising standards and provides training for its staff to
maintain a high level of customer service.

ODEL focuses on making repeat sales to their current customers. And how do they create an
environment where they are more likely to buy from ODEL again and again? Retailers do
actively work to build customer loyalty. ODEL has to “knock their socks off” with incredible
service and value. If they treat them so well that they can’t imagine doing business with any of
ODEL’s competitors, and would feel guilty if they did.

6
Loyal customers are necessary and are a benefit to any business. Without them, retailers’
business might survive, but it’s very unlikely to thrive. Loyal customers tend to buy more from
them, and say positive things about them, very important in this day and age of social media.
And they are, as a rule, much more pleasant to do business with.
Also nowadays people always think of the convenience.

4.0 Current retail market strategy

Modern retailing is far from easy. There are numerous challenges to be faced in the market.
For example, the operational costs are continuing to rise. Hence, margins are slipping, since
price increases cannot be made to commensurate the cost increases.

Setting up a modern retailing outlet is a capital extensive exercise. Hence, the challenge is to
obtain a satisfactory return on the investment, which depends on the competitive advantage
and sustainability of same.

Sri Lanka’s retail fashion industry signaled an evolution in 2011/2012 with the entry of select
international fashion brands to the local market. It is a brand loved, followed and enjoyed by
many. Odel continues to strive towards reinventing the retail experience. It is this pursuit of
spirited excellence that has defined Odel’s journey as not only a retailer par excellence but also
as a corporate leader.

4.1 Locations strategy for market place

The company operates departmental stores, warehouse, retail outlets and apparel stores across
Sri Lanka under the brand name ODEL. It operates stores in Rajagiriya, Maharagama,
Moratuwa, Panadura, Kohuwala, Colombo and Mount Lavinia, Sri Lanka. Odel is
headquartered in Rajagiriya, Sri Lanka.

ODEL's main outlet store is located at No 5, Alexandra Place, Colombo 7. It is also the
company's flagship store which positions itself as Harrods/ Selfridges have done in London
and C.K. Tangs in Singapore – not just a department store but also a tourist destination.

“The location strategy is the final retail principle, and one of the most important factors of the
physical store, and still to this day it will have a major impact on your success.”
7
 (Welfare, 2009)

The best location of ODEL will be dictated by their brand and product strategies. A
departmental store like ODEL definitely needs a car park and high fashion store needs to be in
high fashion area that attracts the right customers for the store. I would argue, however, that
location has less effect now than previously, due to two main factors: the first one being the
flexibility of the customers, now we often travel more, and the second being the internet. The
internet has changed our shopping and will continue to do so.

4.2 Retail Mix

According to ODEL, across their stores, they differentiate the shopping experience and have
on offer, service levels and product ranges that have won international and local recognition
over the years. The Odel brand promises is to inspire customers with trendsetting styles and
premium quality products which are available at affordable prices. To support this, the Odel
retail experience consists of delivering new trends, stylish products, friendly staff,
contemporary interior designs and merchandising, engaging presentations, affordable prices
and simplicity.

The brand personality is therefore simple, yet sophisticated, in taste. It is trendy (through
imagery), energetic (through the many activities in the store), friendly (through its staff) and
international in its delivery standards. Odel’s deep-rooted value makes it a strong competitor
in the marketplace. These values impact its social responsibility and how its employees work
together to keep the dream alive. Odel has been successful in carrying its brand values and
philosophy through to all its endeavors, thus creating a uniform experience that affirms faith in
Odel’s promise. Its ability to respond quickly to emerging trends has been a key factor in its
success story.

8
4.3 Pricing Strategy

The price of a product communicates the company’s intended value of the product. Strategies
pricing the product too low or too high can have unintended consequences. At ODEL, the prices
of products are considerably high. Competition from non-branded lower priced rivals can have
a negative impact on ODEL’s sales. Possible moves by non-branded rivals to offer clothing at
attractive prices could undermine demand for ODEL’s branded, higher priced products.

However, it has to be noted that the price and non-price rivalry is low in the branded fashion
retail industry in Sri Lanka due to the absence of many players.

4.4 Level of customer service

At ODEL, customer service, greater communication was fostered across all key sectors.
Monthly Store Manager Meetings, regular store visits, monthly Visual Merchandiser meetings
and the availability of new financial reports for managers have helped enhance the visibility of
core areas for management focus, each month. Many customer feedback and feed-forward
mechanisms are in place to ensure that an Omni-channel service process is in place at Odel,
thereby creating a conducive environment for service excellence.

At ODEL they offer a host of in-store and online services to the customer to make sure they
walk out of the store with more than just a buy. Maintain a good customer service is the priority,
and to excel in that they conducts monthly store manager meetings, regular store visits and
monthly visual merchandiser meetings. Gift vouchers with a choice of different prices are also
available from RS 500, RS 1000, RS 2500, RS 5000, RS 10000, and RS 15000.

Additionally, in the area of customer service, ODEL deployed an innovative new customer
survey to enrich the in-store experience. The company deployed iPads with a specially
developed iPad application to conduct customer satisfaction surveys efficiently and
unobtrusively at its flagship store at Alexandra Place, and plans to extend the program to other
stores in the year ahead. The application poses a series of dynamic questions pertaining to
different aspects of the ODEL offering and can be completed by a customer in less than two
minutes, providing valuable feedback and insights that will be used to further enhance the in-
store experience.

9
Moreover, ODEL always welcomes their customer views, opinions and feedback of their
service. The customer complaints management process involves interaction with customers for
each complaint, an investigative process to isolate the issue and remedial measures to existing
systems and processes to ensure that the complaint will not be raised again. The customer
remains within the loop of communication and is advised of the end outcome whilst also having
his grievance resolved to the highest level of capability.

4.5 CRM or Customer Loyalty Program

Retailers need an effective retail CRM and marketing solution to satisfy shoppers and compete
in today’s competitive retail market. Our CRM for retail delivers a complete 360° view of every
customer in every channel, providing the insight you need to deliver personalized service, build
customer loyalty and increase revenue. (Solutions CRM)

4.5.1 Advantages of CRM

 Provide Better Customer Service - By collecting information that identifies

customers' buying habits, including preferences and frequency, CRM systems give
businesses a closer look at their customers' wants and needs so they can provide better
customer service solutions.
 Simplified Marketing and Targeting - CRM makes a wide range of data available to
business owners and their department heads. This information allows them to target
specific consumers with marketing that is based on their buying behaviors.

A good CRM associated with a good tool ensures companies to have a good view over
the list of customers and prospects, to know where it stands with relationship
management, when to contact them again, etc. Furthermore, an improved customer
and prospect insight ensures a better and more targeted communication.

4.5.2 Disadvantages of CRM

10
  CRM is not easy to put in place and attention must be given to the choice of
tools, but also to the effective implementation of CRM process that will be
undertaken by the company.

 A learning Curve – Another disadvantage to newly implemented CRM

software is the learning curve. Either implementing a CRM for the first time or
upgrading an older version will require employees to take time out to learn the
system. People dear what they do not know. This may reduce the productivity
as they become familiar with the new system.

Generally, ODEL is looking for a customer focused team player to manage their loyalty
program.

In 2011 they introduced the ODEL loyalty card and are expected to play a focal role in
propagating repeat purchases. This loyalty card helps the customer to accumulate loyalty points
when purchasing at ODEL stores. Using this card the customer is able to earn 1 loyalty point
for a purchasing of RS100. At the point of redemption one loyalty point equals to RS1. So this
loyalty card scheme is highly considerable when comparing to the other loyalty card scheme.

11
4.6 Communication Mix

Communication is an integral part of the retailer’s marketing strategy. Retail communication

has moved on from the time when the retailer alone communicated with the consumers. Today,
consumers can communicate or reach the organizations.

“It is believed that every brand contact delivers an impression that can strengthen or weaken
the customer view of the company.” (Rao, 2010)

Moreover the retailer can use various platforms or channels for communications such as

 Advertising
 Sale promotion
 Direct marketing
 Public relations
 Personal selling

ODEL communication structure facilitates a greater level of communication between

employees and management. They tend to be more democratic and offer a great level of
innovation. Communication is usually faster, more reliable and more effective.

Integrated communications played a critical role in the efforts to build a brand loyalty with
an array of activations, promotions, social media interaction and above the line advertising,
serving to strengthen the brand in the minds of the consumer. All of these communication
and interaction efforts were focused on enhancing the aspirational appeal of the brand
ODEL by inspiring target consumers.

12
4.7 Brick and Mortar Store & Online Store

4.7.1 Physical store

ODEL has given more priority for the physical store. It changes their physical layout time to
time specially during seasons. They select different themes to decorate their premises with
different colors and decorations. Such as New Year, T20, Halloween season, Avurudu season,
Christmas, Easter and Vesak. The decorations are very imaginative and its very unique thing.
It will also help them to attract more customers as well as we can say it’s a marketing trick of
them. Employees are given a special dress code during the season time. And they dress in a
pleasant way and serve the customer in a friendly manner.

4.7.2 In-store services

 Sari draping service

 Concierge service
 Gift wrapping
 Tailoring service
 Currency exchange
 Shop and ship
 Bridal and gift registry
 Other services – Dialog services and American Express banking centre

13
 (Source: Ajay Aggarwal, Hindustan Times)
(Source: www.exploresrilanka.lk)

(Source: www.plus.google.com)
www.odel.lk)

(Source: www.plus.google.com)
gle.com)
14
4.7.3 Website Layout

ODEL provides all information about its organization which shows the transparency of the site.
The site has used very straightforward and simple style of conveying message to customers.
ODEL has four URLs available for each of its sub brands. This would make more traffic and
awareness. Confidential data are secured with ODEL. Because if this is broken the credibility
of ODEL breaks and online business will not functional thereafter. As it is mentioned earlier,
site is highly predictable which makes customers easy to navigate. Consistency is also
maintained. ODEL site is fast enough though it carries some flash animations.

4.7.4 Online shopping and delivery

ODEL provides the international market to deliver their online available item goods to their
foreign customers as well. With the help of some of the professional courier service they deliver
their goods to 70 countries and make sure that the goods are delivered on time. And they would
charge a delivery cost which would depend on the weigh and destination. The list of the
countries and the no of days that takes to be delivered are shown at their website.

The Odel website attracts 12,850 hits each day.

15
16
4.7.5 Visual Merchandising

17
In 2011/2012, the strategy for visual merchandising was changed with a view to simplify the
shopping experience of the customer whilst also infusing theatrical excitement. Thematic cross
merchandising was adopted as a means to prompt purchase of not just one product but a number
of complementary products. Older departments were given better focus to deliver strong visual
identities with multitier visual merchandising efforts. The retail design department was
revamped during the year to deliver greater efficiencies with focus on achieving quick
turnaround from design conceptualization for stores to implementation and store launch.

5.0 Recommendations
Subsequently, having an understanding about the physical store, the website, all its pros and
cons and objectives, following recommendations would be made in order to improve the store
further more.

1. Since ODEL targets all Sri Lankan middle and high income earners, it should have
delivery capacity all over Sri Lanka. Thus they have to maintain decentralized stocks
and partnering with a third party to deliver.

2. Online customers would also like to return and make exchanges online or over the
phone. Thus ODEL have to look in to this need of users. If they are exchanging ODEL
can use same person who is going to deliver the product to pick the old product back.

3. Introduce loyalty system and discount scheme to online users.

4. ODEL needs to improve popularity of the site. Thus online and offline promotions have
to be done.

5. The price strategist should set different prices for product introduction, growth,
maturity and decline.

6. Site must include two options one is for low bandwidth users and other is for high
bandwidth users with many photos of same product from different angles, stream videos
about the product.

18
6.0 Conclusions
To ensure the sustainable growth of modern retailing the following aspects need to be
addressed. Supply chain integration and management is a key pre-requisite. Everyone in the
supply chain is partners and should be profitable. Human resources need to be harnessed and
talent retained in the country. Technology should be harnessed to reduce operational expenses
and other losses. Visual Merchandising and category management are also key areas that need
concentration.

The key for modern retailers like ODEL is to continuously keep their outlets 'fresh' and monitor
consumer buying patterns and behavior. Consequently the present players would do well to
remember that global players may enter the Sri Lanka market in the near future.

Odel’s sustainability strategy encompasses cross-section of stakeholders from employees,

suppliers and investors to communities and the environment. ODEL as an online retail seller,
they must capitalize on their strengths such as customer loyalty, brand names, strong
management, supply chain and cost advantages and the wide variety of products ODEL offers
attracts a large number of customers to the organization. And opportunities, There are untapped
markets for ODEL for which they can move into such as internationalizing the business through
opening branches worldwide. Besides try to reduce their weaknesses such as weak distribution
channels, work inadequacies and cost structure and weak stock controlling system.

"If you keep marketing and selling to baby boomers then you are executing a formula for going
out of business.” (Joe Dalton)

Conferring to the analysis, ODEL’s positioning as an all-round destination will continue to

deliver value and assist it to stand apart in the years ahead.

19
7.0 References

(n.d.). Retrieved 201, from http://www.odel.lk/corporate-odel/about-us

(n.d.). Retrieved from Superbrands.com:

http://www.superbrands.com/lkc1/pdf/05_consumerSB2.pdf

Analytics, S. L. (2009). Odel Financial Review and Analysis. Retrieved 08 12, 2012, from Sri Lanka
Equity Research : http://slresults.blogspot.com/2010/08/odel-plc-odel-net-profit-has-
surged-two.html

Brookins, M. (n.d.). CHRON Small Business. Retrieved 2014, from

http://smallbusiness.chron.com/advantages-disadvantages-crm-43395.html

CORPORATE. (n.d.). Retrieved 2013, from odel.lk: http://www.odel.lk/corporate-odel/about-us

Denanteuil, H. (2013, 05 29). Retrieved from TALCOG BLOG:

https://www.talcod.net/en/blog/advantages-and-disadvantages-customer-relationship-
management-crm

Gunawardene, O. (n.d.). ODEL Mind Body and Soul. Retrieved 2014, from Otara.lk:
http://otara.lk/welcome/odel

Rao, S. R. (2010, 08 02). Cite Management Article Repository. Retrieved from Citeman.co:
http://www.citeman.com/9829-the-retail-communication-mix.html

RBR General Retailers. (2010). Retrieved from Retail Business Review: http://www.retail-business-
review.com/companies/odel-pvt-ltd

Research into Strategic Management in Fashion Brand ODEL. (2003). Retrieved 2014, from
UKessays.com: http://www.ukessays.com/essays/business/research-into-strategic-
management-in-fashion-brand-odel-business-essay.php

Solutions CRM. (n.d.). Retrieved from NETSUITE Retail Anywhere:

http://www.retailanywhere.com/solutions/crm-and-marketing.php

Welfare, A. (2009). Retrieved from The Marketing Donut Resources for Business:
http://www.marketingdonut.co.uk/marketing/marketing-strategy/the-five-principles-of-
retail

20