Developing Sales Promotions Strategy to Improve Online Profit for Next Company

DEVELOPING SALES PROMOTIONS STRATEGY TO IMPROVE ONLINE PROFIT IN THE BUSINESS TO CUSTOMERS SHOPPING ONLINE FOR NEXT COMPANY

Abstract

The first chapter is the introductory section that contains the overall paper aim and objectives. This section is critical to understand the overall paper validation. Information collections from the Next Company’s annual report were shown in this section to validate and justify the problem.

The second chapter is the literature review chapter where a summary of previous literature or research paper has been done. Throughout this chapter various themes five develop from the pre-existing findings with the company's case study and example to give a detailed clarification. The chapter also summarizes the key finding with the help of two, and theory, consumer behaviour theory and buyer’s classification theory.

The next chapter is the methodology chapter where various methods used throughout the research paper have been identified and validated. The reason for selecting any particular method where justify and use of the method in terms of advantage also specify.

The Critical Analysis section helps in providing transparent market oriented understanding about the conditions of the Next Plc and its deteriorating stage of online business condition. This section through the construction of certain themes have been able to provide a proper understanding about better business sustainability that can be achieved by Next Plc.

The Recommendations section has provided information about the actual understanding of the business issues and has provided efficient recommendations through which the issues can be eradicated. Apart from that, a detailed action plan also has been developed, through which Next Plc can be able to develop their business process and ensure a proper stability in long term online sales development.

List of figures

List of tables

Chapter one: Introduction

Introduction

The introductory section is the beginning yet carries greater importance later on this paper. The very section included the overall paper aim, objectives, problem rationale and paper significance. Hence, just by reading this chapter, one reader gets clear ideas of things that will happen further down this paper.

Background

The UK is rich for business environments. As per the 2019 statistics, around 20% of the sales in the retails sector contributed by online method (Statista.com, 2022). Almost all the international companies have their brunch in the UK. The Next is an online fashion company that carries fashionable clothes, beauty products for all types of people. One can go through a vast amount of products before purchasing the desire one. The company also specializes in brand selections, and around 20 different brands were added in the company’s website. The company is also increasing their portfolio in other aspects like gifts, foods and drinks and others. However, there are no in-house products the company sells or personalizes brands. The main sourcing channel for the company is an online platform. The company is a PLC company and most of their funds come from public investments.

Figure 1: NEXT business model

(Source: NextPlc.co.uk, 2021)

The above figure shows the business model of the Next Company and the uniqueness of the model. The company not only has online stores but also offline stores with a large supply chain. However, the company is slowly moving towards in-house production from retail online fashion selling companies.

Research problem

Analysis of the company's annual report and online traffic show the decrease of the company sales. According to the 2021 annual report, the retail operating margin for the company had decreased.

Figure 2: NEXT Plc., operation margin comparison

(Source: NextPlc.co.uk, 2021)

The above figure is evidence that the opening margin for the company had decreased on year end comparison. In terms of shareholder investment and return perspectives the company is also struggling to stay competitive.

Figure 3: NEXT Plc., shareholder return comparison

(Source: NextPlc.co.uk, 2021)

As shown in the above future, in response to ordinary dividends, shareholders recover less, furthermore in 2020; the share buyback was also be reduced. However, one can argue that this may be covid-19; however, 2022 traffic analysis data also indicated that the company is losing their customer faster. This is the last three month web-traffic data of the Next Company which clearly shows that the company is steadily decreasing customers each month.

Figure 5: NEXT Plc., traffic changes country wise

(Source: Similarweb.com, 2022)

Apart from the US, the company is quickly losing market share over international level.

Figure 6: NEXT Plc., online traffic sources

(Source: Similarweb.com, 2022)

The above figure shows that people who visited the website are actually due to direct search. This indicates that the company is slowly losing presence for the customer in the market. Hence, customer perception is changing means for the next annual report the company will also steadily lose customers.

Aim and objectives

The aim of the paper is “to identify the cause of the current issue with NEXT Company on declining their sales performance and develop a plan to boost their sales in future”. There are few objectives that were also created to identify things that had been accomplished in this paper later.

• To identify various factors associated for the Next company’s online sell

• To analyze any recent changes on any factors for the Next company

• To evaluate the impact of changing those factors on the company’s performance as well as future performance

• To recommend any possible solution for the company to boost their performance

Research questions

The research question will be put in use to collect various secondary research papers and analyze them. Based on the objectives there are four research questions that were developed.

1. What are the factors associated with a company’s online sale?

2. How changes in one factor can change a company’s sales performance?

3. How can the impact of those factors affect a company's sales?

4. What are the possible ways a company can control these factors under marginal level?

Research rationale

The issue is, the Next Company is steadily losing their online customers. The company’s presence is slowly vanishing away for the customers. The company had not taken or achkan solved the problem in front of the media meaning in future the result will be significant.

This is an issue because, without any acknowledgement or changes this phase will continuously happen. In the future the company will reduce the number of customers in greater numbers. Therefore, necessary steps need to be carried out immediately.

In current times this is an important issue because after covid-19 some degree of poor performance was expected. Therefore brands are in continuous advertisements to increase the profit. On the same side the selected company does not carry out any plan to gain back loss profit.

The paper had shed light on the current problem inside the company's business model and proposed a changing plan. The paper suggested a sales boosting mechanism which was expected to give the company’s sales a boost.

Research scope

In-Scope	Out-Scope
Next performance analysis Sales analysis Stakeholder analysis Stakeholder return analysis Business model analysis	Core-competencies suggestions Develop competitive advantage method Financial balance-sheet analysis

Table 1: Paper scope

(Source: Developed by student)

The above table shows things on which the paper generated findings and things that were left to be ignored.

Research significance

The significance of the paper is that it developed findings based on the company's annual reports. Additionally findings from the annual report were also critically discussed supported by existing research. Therefore the viability of the study is comparatively high and the company can easily implement them in their business model.

Research structure

Figure 7: Research structure

(Source: Developed by author)

Summary

The chapter summarizes that all the information provided this will be used to collect secondary research papers. The objective and question developed in this section was crucial to collect various secondary sources that discuss various challenges in the online business. Additionally, the scope developed in this section will also play a crucial role in the findings and analysis section of this paper.

Chapter Two: Literature review

Introduction

The second chapter is basically a summary of all the work done by existing researchers. Even on a single topic, with new research new information comes. The literature review section helps research to understand progress made by existing researchers and scope for improvements. This section was made by keeping focus on the previous section's aim and objectives. The summary of literature that can best highlight the solution of the research objectives were described in this section. Additionally, theoretical perspectives described in this section had helped the author to highlight literature gaps and possibilities for improvements.

C onceptual framework

Figure 8: Conceptual framework

(Source: Developed by author)

Variety of products, flexibility in payments, random offers, low price and best brand can describe the Next Company’s online sales

It is debatable since in this company there is no particular research paper available. However, a collection of several research papers on online fashion retails companies can highlight some of the common factors that are associated with a company’s online sales. Scholars like Sayyida et al. (2021), highlight the first factors as a variety of product displacements. In a traditional shop a customer can compare between different products of the same brand based on price or they can compare between different brands. Having different products allows customers to choose from a wide range of products that can boost a person's confidence. For instance, brands like Amazon, Zara have a wide range of products from the same price range in different colours and styles and same products under different price ranges. Therefore, more diversity in a product range allows more chances of sales. However, as criticized by Yan et al. (2018), the diversity of a product must come under customer choice range. For instance if two products have 100 pounds price differences but the company gives a discount on the highest prices so the difference comes down to 20 pound, the chances of selling gets high.

Even in modern psychology such customer behaviour terms as Compulsive buying disorder, where customers buy a product not based on utilization but narrow window to get additional benefits. Companies like Udemy use the same tactics where they reduce product prices by 80% to boost the company's sales. Hence, carefully placing various random offers can help a company not only to increase website traffic but also to boost sales. Additionally, in any business cost leadership always plays a vital role. According to Bozer and Aldarondo (2018), from a consumer perspective, cheap and high quality products are always in demand. In order to decrease a product's price range, companies focus on supply chains to reduce variable costs like transportation, VAT, and taxes that can reduce the overall price of products. Furthermore, selling different profound brands gives customers confidence about buying products from other retail companies. Hence, even in the beginning many companies sell worldwide recognized brands to increase the company's brand awareness and reputation along with trust within the customers.

The customer utilization perspectives had recently changes for many online as well as offline business

The covid-19 had paralyzed the financial stability of the nationwide. According to the findings of Xia et al. (2020), customers' expenditure ability decreased after covid-19 and only potential products had seen a boost in sales. For instance, products with high prices and famous brand levels have decreased. Therefore, the overall utilization perspective about the products had been changed. Customers are now looking for products that value them most. Hence, there will be less chance that at this moment customers will be triggered by sudden offers. All this information indicates that for Next Plc., the chances of selling cheap on demand products is more than selling top brands products. Hence, a fluctuation on the company’s profit can be seen as shown in the previous chapter. According to Wang et al. (2018), after covid-19 the changes on online business will definitely increase along with flexible payment options and even pay later options. All these new features and change in business dynamics points towards those customer perspectives about online business had been changed.

Additionally, in terms of fashion products, customers are now looking for flexible material with high tensile and longinity. Hence, this gives companies a new dimension to change their product design to increase sales. Companies also invested into feedback and calling departments where company customer care employees call customers to inform about new products and all sales. This strategy is a classical one, still defining values in areas where customers are less aware about the product's sales (Dannenberg et al., 2020). Many companies also invested in the data oriented solutions to define targeted customers again after post-covid era. Additionally, the success of online business relies on the expenditure of the data and strong analysis on the customer data. While other large competitors like Amazon, Ebay are mostly expanding their business with data centric solutions, the Next Plc still rely on the pre-covid data. This creates the major gap for the company to reach their targeted customers.

Avoiding information collected from the customer and negligence of customer perspective can lead to serious change in the business profit

Retail business is all about aligning business, operational and strategic plans to new trends. Based on the external factors, such as cultural influence, economical influence, these trends can be changed over course of time. Therefore, any business continuously needs to collect information from the consumer's perspectives to analyze it in such a way to re-evaluate customers' demand. Jones and Livingstone (2018), added that businesses that are in continuous evaluation of customer perspective changes can always find competitive advantage over competitors. Additionally, values a business adds though a product or service must be easily spotted by customers. For instance similar colour products in a retail store can create a challenge for companies to deliver any product related message to customers. According to Wiranata and Hananto (2020), an effective product can become the flagship of a business if it is related to customer demand and the customer can uniquely identify the product in the market. A real life example of such a case is the Apple Smartphone which addresses the privacy of customers and due to different products design, operating system, customers can uniquely identify the products from other smart phones. Furthermore, companies also create product delivery plans through advertisements. In that case, a study found from Lindh et al. (2020), paper indicates that in current business environments, catching customer attention though direct advertisement is a daunting task. Especially, in the retails sectors, businesses have less scope to differentiate their products from competitors.

On the other hand, adaptation of indirect advertisement can effectively address the value added by the company regardless of the products. However, a common challenge is that values that get addressed by a company must be challenges for customers, so that customers can understand the importance of a business. Generally, in the Next Plc company apart from the diversity of the products, the advertisements is seems to be direct. In the current world, customers now have a range of business from which they can purchase; hence, a solid definition is missing for the company that gives customers a reason to stay. Additionally, the business also needs to add value through advertisements that can give customers a sense of brand. For instance while buying from Amazon; customers pay less attention to the product brand and more on the platform as a brand. Hence,

Brand awareness, customer centric operation, customer profiling, advertisement plan and customer feedback are some useful tools used by online business

On online business the brand awareness carries a significant impact on sales. For instance, while buying products from apple or Google stores, customers do not look for products brand rather than believe in platform brand. Therefore, for online business, brand awareness gives customers an ecological assurance of product quality. Platforms with high brand awareness generally carry out three factors to increase customer satisfaction level. These factors are easy customer executive accessibility, easy to use the platform and clear product description with existing customer feedback. According to Burgard et al. (2019), since for online business, customers can not get a sense about a classical store environment, takes to sales people, hence, it is important to increase brand awareness. Additionally, customer centric approach is another crucial landmark of a successful online business. Companies that spend time and resources on analyzing data carry significant advantages over competitors. This comes with another close factor called customer profiling. Analyzing customer behaviours on web pages like time they spend on the specific products, number of time they added in the cart but not purchase all give business ability to understand their customers (Sufian et al., 2020). For instance, customers spend more time on a specific item page but not purchase it meaning customers have potential but want something else like offers, discounts and others. Analyzing customer behaviours also gives businesses unique advantages about increasing the product range, understanding the limitation of the price increments and adding new products to the market.

Additionally, companies can also increase in house production just by analyzing customer data. For instance a brand that carries high brand awareness also carries potential to sell in-house products if they can analyze common products sold under a business. A real-life example of such cases is Amazon companies that have Amazon Basic products category that are basically in-house productions. Hence, an advantage comes with retail business is that as they sell large volumes of other companies products, they also carry potential to increase brand awareness and sell in-house productions (Dolega and Lord, 2020). The advertisements plan put the final milestone for online business sales. With so many internet advertisements, a business really catches people's attention. Simple and clear information about products is direct approaches that keeps simple product descriptions and lets customers understand product value.

Theoretical perspectives

Customer behaviour theory

Figure 9: Customer behaviour theory

(Source: Pillay and Mayayise, 2021)

According to this theory, there are four factors that make potential customers into buyers. According to Qalati et al. (2021), psychological factors influence a person's attitude, perceptions about a situation and ability to understand information. For instance a customer who is concerned about chemical products will definitely spend more time searching for healthy natural products. The second factor is called personal factors that mean an older person will definitely buy something in a different manner than a young person. The person factors highlight a person age, sex, culture, sexual orientations and others. Hence, businesses do customer profiling to understand the relation between different types of customers. The social factors include perception from society. For instance, in case society suddenly adopts a new product, then that increase chances of a person to buy something that they have never heard of before. The final factor is called marketing message and because marketing is an example where customers buy something because it is the right thing to do. For instance, baby products are the one which use cause marketing that show business have experts who carry better knowledge to maintain a baby’s health so customers should buy their products.

Buyer classification theory

Figure 10: Buyer classification theory

(Source: Americo and Veronica, 2018)

The buyer classification theory had divided the buyer in eight categories. Consumers who put quality over price are called perfectionists, while Brand-aware is the ones who only focus on buying from a specific brand. Additionally, Hedonist and Price-aware are the one who take shopping as an enjoyment and focus on the lowest price respectively. Fashion-aware customer’s always put trends over others, while Impulsive carry spontaneous decision making processes. In case there are too many options, customers often do not buy and such a category is called Confused. Habitual customers are always loyal to the brands.

Literature gap

The fellow literature spotted key trends in the business but did not initiate competitive advantage strategy. Therefore, the direct application of the existing literature is limited. Additionally, the existing research paper shed low light on the customer behaviour changes after covid-19 with primary quantitative evidence.

Chapter summary

The chapter can be summarized as understanding brand value, customer behaviours and categorizing customers into different groups is a way to gain competitive advantage. The chapter reveals the findings with some real-life practical examples from global companies. Additionally, this section shows the types of buyers and reasons a potential customer buys something. Furthermore the chapter analyzes the literature gap that was missed by existing researchers.

Chapter Three: Discussion of the secondary research undertaken

Introduction

The third chapter is the methodology section that defines specific methods used for this study. Through this chapter, research explained the reason for selecting any specific method and advantages acquired in the finding due to selection.

Research parameter overview

Names	Attributes
Research philosophy	Realism research philosophy
Research approach	Inductive research approach
Research design	Exploratory research design
Data type and source	Secondary qualitative data from internet, company’s annual reports
Population and sampling	Non-probability convenient method to collect 8 sample papers
Data analysis plan	Thematic analysis

Table 2: Research parameters

(Source: Developed by author)

Research onion

Figure 11: Research onion

(Source: Melnikovas, 2018)

Research philosophy

There are three most common research philosophies that are generally applied; positivism, realism, interpretivism. This situation the author decided to go with realism research philosophy. There are several factors based on this decision. According to Naseri (2021), the characteristics of realism research philosophy provide a wide range of independence. Independence also crosses the human mind. Therefore, scientists and researchers who adopt realism research philosophy mainly depend on accuracy of the data instead of any presumptions. Additionally, having a realism research philosophy also ensures that only the scientific method gets followed to develop findings in a research. The realism research philosophy is two types; direct realism and critical realism. The direct realism only portrays things though personal human sense. This indicates findings from direct realism are based on things that research sees without validating it though other manners. On the contrary the indirect realism argued on findings through critical analysis. In this section critical realism was followed to justify the problem of the selected company according to other research perspectives.

Research approach

In this case also three types of research approach are available; explanatory, exploratory and descriptive. In this case since the objective was to find the reason for sales going down and come up with a solution, the exploratory research approach was followed. Due to this approach, the author allowed to test any findings with other similar findings. The author took the objective to develop a new method of sales boost that can be directly applied in the company without any adjustment. Due to this reason the explanatory research design was helpful to develop new findings from the pre-existing data. According to Zhuang et al. (2018), researchers who adopt exploratory research design carry advantages to on flexibility. For instance the authority had scope to change the data sources and types due to exploratory research design. As the author took scope to find new meted, this has a higher degree of flexibility to test, validating the pre existing findings.

Research design

The research design was described with two types, inductive and deductive. The difference between inductive and deductive is that in an inductive method, new findings come up with pre-existing theories, whereas in deductive new theories come up. Since the existing research already highlights the core factors for online sales, the paper had to show an inductive research method. Based on the company’s annual report, pre-existing business model and existing targeted customers, a new method came up. The primary advantage of having this design is that the researcher had flexibility to analyze collected data from different directions before giving an evidence based conclusion. According to Schallehn-Schmidberger (2019), inductive research design begins with a detailed approach about the world, which moves towards more general ideas. Hence, adaptation of inductive approach allows a researcher to adopt empirical generalizations of preliminary relationships as progression gets made throughout a research.

Data type and source

The type and source of data are basically the essence of the findings therefore the entire research paper. The selected organization is large; therefore, collecting surveys would take time and resources. Additionally, carrying out interviews in this covid period was also not possible. Due to these circumstances the collection of primary data was avoided. In terms of type of data, due to restriction on the covid and large business premises, survey might require a lot of time. Due to this the qualitative data was only considered. Under this circumstance the data type was qualitative and data sources vs. secondary. In order to collect secondary data, the author searches internally for the company's annual report and research paper on online business sales. Different keywords were used to collect information about the company sales and selection of internet based research papers helped the author for critical analysis.

Population and sampling

In terms of population and sampling method, a non-probability sampling method was selected. This is similar to exponential smoothing for quantitative data analysis. Due to the non-probability method the priority and weight-age of the data were different. For instance data that were collected for the last 2 years were put with the highest weightage while data that collected more 2 years were less prioritizes.

Data analysis plan

The secondary qualitative data is sometimes criticized as soft data but with proper data analysis method findings can be acquired. In this case the author selected a thematic analysis method, which is popular among the researcher due to simplicity. Based on findings on data focusing on the objectives, various statements were generated. Each statement is then analyzed properly based on the scale of the data. Thematic analysis allowed the author to undertake a lot of flexibility while finding different information such as keywords. Similarity of the research objectives were used for theme development, where information was compared across multiple research papers.

Ethical aspects

In this case the copyright law was obeyed. In each section while comparing with different research papers, citations were used with data and references. Additionally, university guidance was also followed and my kind of patents was ignored. All the information was collected based on a healthy DOI number to ensure authenticity of the information.

Summary

The chapter can be summarized as in this section, the secondary information was only considered for analysis. Parameters selected in this section play a crucial role in the next chapter to collect information and validate them. Additionally, the methodology section added the importance of each research parameter and contributed to the research findings.

Chapter Four: Critical review of the results of the research

Introduction

This is the findings and analysis section where proper findings of secondary information will occur and development of analysis will be done providing a field oriented understanding of the market condition of Next Plc through the construction of certain themes.

Findings

Increased rivalry in the online market

The rivalry in the international retail market has significantly increased based on which Next Plc. is facing a significant issue in projecting their products and getting a decent reply from the market. The profits of the organisation fell by 5.5% to £790 where the total sales fell by 2.9% to £2.3 billion. Next Plc is facing significant issues in operating in the online sales market as major players have already a wide range of share on the online retail sales (Theguardian.com, 2022). The main threat to the online business of Next Plc is that customers are spending less on buying clothes amid this pandemic period that is very common in the current context. It has been identified that the margin of difference in sales rate that was zero encountered a 2.3% annual hit (Theguardian.com, 2022). Depending upon these circumstances, it has been very prominent that the organisation is facing increasing challenges for tough competition from existing big brands.

Decline in profitability of Next Plc.

The profitability of the organisation has greatly decreased due to the advent of the covid 19 pandemic and rapid complications in the supply chain market. Next Plc encountered a significant loss of 17% on its revenue rate that amounted to around £3,625.9 million in its FY 2021 compared to the revenue of £4,361.8 million in the 2020. The organisation’s profit before taxation dropped to around £342.4 million and the operating profit dropped to £444.5 million (Fibre2fashion.com, 2022). The decline in the performance of Next Plc has been significantly complicated for the organisation as they are ongoing with a significant loss in their business process. The retail sales of the organisation plunged down to 48% low amounting to £954 million (Fibre2fashion.com, 2022). These issues for the organisation have been significantly complicated for the company based on which the organisation faces issues in operating in the UK as well as the international market.

Impact of lack of covid-19 and profitability on company’s performance

Lack of profitability and the advent of Covid-19 pandemic have created a massive issue for the organisation to operate in the international market. Due to the advent of covid-19 pandemic the retail stores of the organisation have been closed and international trade and commerce has come to a stage of disruption. The closing of offline retail stores led to the online demand for products increasing for Next Plc. to a significant extent; however, the organisation is unable to provide due to the affected supply chain process and weak logistics system in the pandemic period. A lack of organisational sustainability has been identified as staff pressure has increased to a significant extent forcing the organisation to make a halt in online sales (Ft.com, 2022). The organisation nearly shut 200 stores in the UK and these resulted in increasing pressure in the ecommerce section where the employees of Next Plc. are facing increased pressures resulting in halting of online sales. Due to keeping a halt in the online sales for a certain time being, the demand for the online products decreased from the stores sales rate that is lower than £1.85 billion (Ft.com, 2022).

Steps for increasing online sales development

The organisation has been mainly focused to develop its online sales through attracting a youth audience. The organisation is mainly planning for investing in online marketing strategies in order to develop a better brand reputation through which the customers can be attracted towards its products. The business confirmed that it will invest around £100 on its online marketing next year representing its investment in both personnel and software through which an increase in online sales can be expected (Marketingweek.com, 2022). Next Plc. identifies that there can be a 40% rise in online sales after proper implementation of online sales development which has been necessary in order to stabilise the sales development of the organisation in a long term perspective (Marketingweek.com, 2022). Depending upon these aspects it can be figured that there is positive expectation from the brand in the future business context.

Analysis

Theme 1: Tough competition from Zara, H&M and others decreasing profitability

Zara, H&M and other high street fashion brands are providing tough competition to Next Plc to a significant extent as their online business development is better due to improved infrastructure. Other than Primark, Zara, H&M, Marks and Spencer, Arcadia Group, Debenhams and others are providing tough competition to Next Plc. All the business organisations are investing rapidly on strengthening their e-commerce platforms through which better organisational development can be attained. The UK has encountered a combined rate of online sales of about £693 billion (Statista.com, 2022). This proves the increasing stability of the online business organisations in the UK retail market and the reason based on which Next Plc is facing tough competition from these organisations.

Figure 12: Financial Growth of UK Retail market

(Source: Statista.com, 2022)

Theme 2: Covid-19 pandemic increases online trade competition and closing of retail stores

The closing of retail stores due to covid 19 pandemic has been the main result due to which the customers are shifting to online purchasing. It has been identified as the rate of web trafficking for Next Plc. has decreased from its previous percentage marking the gradual decline of sales and customer interest of online purchasing from Next Plc. Due to this context, the company is trying to invest on online marketing for improving the web trafficking and attracting more audience for attaining better customer purchasing rate. The Covid-19 pandemic has resulted in disruption in the international supply chain management system and all the organisations are facing complications based on lack of supplies and other logistics oriented issues (Chowdhury et al. 2021). It is necessary for the organisation to invest more on online marketing through which the web trafficking rate of Next Plc can be increased ensuring long term business success.

Figure 13: Next Plc.’s web traffic in last three months

(Source: Similarweb.com, 2022)

Theme 3: Closing of offline stores increasing operational supply chain issues for online sales

The closing of offline sales has been constant due to the advent of Covid-19 pandemic depending upon which the online demand for the products has developed to a significant extent. Due to international sealing of borders logistics oriented issues have been common and establishing international trade development has been completely stopped. As stated by Iordanoaia (2020), online sales development is significant in the current business environment as customers are shifting to online from offline at a rampant rate. The rate of online demand for Next Plc has increased to a significant extent due to the closing of nearly 200 stores in the UK. The increased pressure on the workers is thus developing employee dissatisfaction leading to a temporary halt in online sales resulting in significant loss for the company. The company is thus unable to provide products for its customers due to the issues in the international supply chain management system related to its logistics department.

Theme 4: Next Plc has to utilise innovative marketing campaigns to attract better audience in the online sales market

Next plc is currently facing a significant loss due to the advent of Covid-19 pandemic and issues in the international supply chain management system and closing of its 200 retail stores in the UK resulting in a 33% sales loss (Proactiveinvestors.co.uk, 2022). On the contrary, Next Plc. has taken certain effective steps, through which theory online sales rate can be improved as it is investing an amount of £100 million through which it expects a sudden rise of the online sales market (Marketingweek.com, 2022). Next Plc can invest in SEO for increasing the web trafficking rate through a better attraction of the customers attained. It can be expected that the investment of 100 million on improving online sales development can be positive as the web trafficking rate of the youth can increase as they are the main users of e-commerce systems.

Summary

This section thus provides a detailed understanding of the field oriented issues of Next Plc and also provides effective data, through which the information that is attained is constructively analysed in a clarified manner. This has helped in providing information about the issues and developing proper recommendations, through which productive strategies can be developed for better organisational growth.

Chapter Five: Recommendation and Action plan

Recommendations

Taking innovative marketing initiatives

Based on implementing innovative marketing strategies the organisation can be able to gets a better customer attraction rate resulting in better website traffic development. Focusing on SEO and social media marketing can be beneficial for Next Plc. based on which the organisation can be able to attain a better customer interest ultimately resulting in increased online sales rate. Social media marketing has the capability to encourage and attract the youth audience, who mostly engage in purchasing from the online business platforms. Thus, it is effective for the business organisations to stabilise business processes and enhance their ability in staying in the competitive business market.

Strengthening logistics

The organisation is mainly facing issues due to delayed supply chain and issues with the logistics section as they are incapable of providing the products to the suppliers. The managerial section of the Next Plc can be able to develop their ability in securing a partnership with any of the big logistics organisations like FedEx or even Amazon to improve their logistics services for reaching every customer and providing their best efforts to ensure customer satisfaction in a stable manner. Depending upon these circumstances the online sales development of Next Plc can engage in developing itself to a stable context.

Action Plan

Issues	Description	Mitigation Step	Impact	Time Period
Decrease in web trafficking	Decreased web trafficking has been a significant issue for the organisation as this results in lack of customer interest for the products of Next Plc.	Investing on Search Engine Optimisation and Social media marketing	Better website traffics and increased attraction of youth audience securing online sales development	1 month
Lack of customer interest in spending for buying clothes	Decreased customer interest in buying clothes due to the advent of Covid-19 pandemic and disruption in the international supply chain.	Providing discounts and interesting offers by decreasing price margins	Increased interests of the youth as well as middle aged customers for getting a comparatively low price compared to other online retailers resulting in improved online sales.	2 month
Logistics oriented supply chain issues	Lack of proper supply from the suppliers and disruption in organisation's delivery system due to lack of proper logistics issues	Partnering with logistics organisations for better and improved service	Better customer satisfaction and proper supply chain management system through effective partnership.	4 months

Table 1: Action Plan for the Development of Next Plc

(Source: Created by author)

Analysis:

After engaging in proper understanding it has been identified that there are certain steps of action that are necessary for the Next PLC for improving its online sales development. Investing in Search Engine Optimisation and Social Media Marketing are the most important tools in the current time frame for developing positive interest within the audience and increasing website viewing rate. According to Doniec et al. (2020), increasing customer attraction helps in ensuring sustainability of an organisation for a long term range. It helps in improving brand reputation and focuses on projecting the organisational products to the mass audience through which increase in sales development can occur. Apart from that, providing new and exciting discounts for the audience also can be beneficial as the customers, mainly the youth generation, can be interested in buying the organisations at a reasonable price developing the rate of online sales development. As opined by Pasi et al. (2020), supply chain management system is the backbone of any business organisation depending upon which the overall business operations are dependent. Construction of a better supply chain management system is also an important step based on which the organisation can be able to partner with any logistics organisation and develop their supply system and delivery system in a productive manner ensuring fast and secured delivery to the customers increasing their satisfaction rates.

Conclusion

Thus, it can be concluded that better sales development is the intention of all retail organisations operating in the international market. However, it has been identified that due to the advent of Covid-19 pandemic various organisations have been facing tough supply chain issues and Next Plc. is not an exception as it has been facing significant challenges in the international business process. In order to cope up with various challenges like market competition and disruptions in the logistics system the company needs to focus on improving customer attraction capability through innovative marketing and partner with logistics organisations for eradicating their issues in the delivery system. Through abiding by these steps, it can be expected that the condition of the organisation will be sustainable in the future business context.

References

Americo, A. and Veronica, A., (2018). The effect of e-commerce on employment in the retail sector. Mimeo.

Bozer, Y.A. and Aldarondo, F.J., (2018). A simulation-based comparison of two goods-to-person order picking systems in an online retail setting. International Journal of Production Research, 56(11), pp.3838-3858.

Burgard, D.A., Williams, J., Westerman, D., Rushing, R., Carpenter, R., LaRock, A., Sadetsky, J., Clarke, J., Fryhle, H., Pellman, M. and Banta?Green, C.J., (2019). Using wastewater?based analysis to monitor the effects of legalized retail sales on cannabis consumption in Washington State, USA. Addiction, 114(9), pp.1582-1590.

Chowdhury, P., Paul, S.K., Kaisar, S. and Moktadir, M.A., (2021). COVID-19 pandemic related supply chain studies: A systematic review. Transportation Research Part E: Logistics and Transportation Review, 148, p.102271. Available at: https://www.ncbi.nlm.nih.gov/pmc/articles/PMC7881707/ [Available at: 10.03.2022]

Dannenberg, P., Fuchs, M., Riedler, T. and Wiedemann, C., 2020. Digital transition by COVID?19 pandemic? The German food online retail. Tijdschrift voor economische en sociale geografie, 111(3), pp.543-560.

Dolega, L. and Lord, A., (2020). Exploring the geography of retail success and decline: A case study of the Liverpool City Region. Cities, 96, p.102456.

Doniec, A., Lecoeuche, S., Mandiau, R. and Sylvain, A., (2020). Purchase intention-based agent for customer behaviours. Information Sciences, 521, pp.380-397. Available at: [Available at: 10.03.2022]

Fibre2fashion.com. (2022). British clothing company Next's FY21 revenue falls 17% to £3,626 mn. Available at: https://www.fibre2fashion.com/news/retail-industry/british-clothing-company-next-s-fy21-revenue-falls-17-to-3-626-mn-273264-newsdetails.htm [Available at: 10.03.2022]

Ft.com. (2022). Next bows to staff pressure and halts online sales. Available at: https://www.ft.com/content/483b3b77-b40f-44e3-bddb-df3ce01d3d64 [Available at: 10.03.2022]

Iordanoaia, F., (2020). Management for “Online” Sales, Present and Business Development Perspectives. ANNALS ECONOMIC SCIENCES SERIES Volume XX Issue 2, p.676. Available at: https://www.researchgate.net/profile/Anca-Iacob/publication/355700342_A_Theoretical-conceptual_Approach_to_the_Particularities_and_Functions_of_the_Stock_Markets_in_the_Context_of_the_Pandemic_Period/links/617a5333a767a03c14c020e4/A-Theoretical-conceptual-Approach-to-the-Particularities-and-Functions-of-the-Stock-Markets-in-the-Context-of-the-Pandemic-Period.pdf#page=692 [Available at: 10.03.2022]

Jones, C. and Livingstone, N., (2018). The ‘online high street or the high street online? The implications for the urban retail hierarchy. The International Review of Retail, Distribution and Consumer Research, 28(1), pp.47-63.

Lindh, C., Rovira Nordman, E., Melén Hånell, S., Safari, A. and Hadjikhani, A., (2020). Digitalization and international online sales: Antecedents of purchase intent. Journal of International Consumer Marketing, 32(4), pp.324-335.

Marketingweek.com. (2022). Next continues to ramp up digital marketing spend as online sales surge. Available at: https://www.marketingweek.com/next-digital-marketing-online-sales/ [Available at: 10.03.2022]

Melnikovas, A., (2018). Towards an explicit research methodology: Adapting research onion model for future studies. Journal of Futures Studies, 23(2), pp.29-44.

Naseri, R.N.N., (2021). What is the population in online shopping research? A perspective from Malaysia. Turkish Journal of Computer and Mathematics Education (TURNCOAT), 12(4), pp.654-658.

Next.co.uk, (2022). Home. Available at: https://www.next.co.uk/search?w=annual%20report&isort=score&af=#1_306 [Accessed on 10.03.2022]

NextPlc.co.uk, (2021). Next ANNUAL REPORT & ACCOUNTS. Available at: https://www.nextplc.co.uk/~/media/Files/N/Next-PLC-V2/documents/2020/annual-report-and-accounts-jan20.pdf [Accessed on 10.03.2022]

Pasi, B.N., Mahajan, S.K. and Rane, S.B., (2020). Smart supply chain management: a perspective of industry 4.0. Supply Chain Management, 29(5), pp.3016-3030. Available at: [Available at: 10.03.2022]

Pillay, E. and Mayayise, T., (2021). The significance of key constructs on consumer purchase intention in online retail in a Covid-19 climate.

Proactiveinvestors.co.uk. (2022). Next tumbles to loss but says online shopping habits are sticking. Available at: https://www.proactiveinvestors.co.uk/companies/news/929313/next-tumbles-to-loss-but-says-online-shopping-habits-are-sticking-929313.html [Available at: 10.03.2022]

Qalati, S.A., Vela, E.G., Li, W., Dakhan, S.A., Hong Thuy, T.T. and Merani, S.H., (2021). Effects of perceived service quality, website quality, and reputation on purchase intention: The mediating and moderating roles of trust and perceived risk in online shopping. Cogent Business & Management, 8(1), p.1869363.

Sayyida, S., Hartini, S., Gunawan, S. and Husin, S.N., (2021). The impact of the COVID-19 pandemic on retail consumer behavior. Aptisi Transactions on Management (ATM), 5(1), pp.79-88.

Schallehn-Schmidberger, A.G., (2019). Selected Management Tools to Increase Sales in a Small Retail Shop in Vienna. Webster University.

Similarweb.com, (2022). Next.co.uk. Available at: https://www.similarweb.com/website/next.co.uk/#overview [Accessed on 10.03.2022]

Statista.com, (2022). E-commerce in the United Kingdom (UK) - statistics & facts. Available at: https://www.statista.com/topics/2333/e-commerce-in-the-united-kingdom/ [Accessed on 10.03.2022]

Statista.com. (2022). E-commerce in the United Kingdom (UK) - statistics & facts. Available at: https://www.statista.com/topics/2333/e-commerce-in-theunitedkingdom/#topicHeader__wrapper [Available at: 10.03.2022]

Sufian, A., Min, C.S., Murad, M.A. and Aziz, N.A., (2020). The impact of social media marketing on sales performance of small online businesses. European Journal of Molecular & Clinical Medicine, 7(3), pp.922-940.

Theguardian.com. (2022). Next admits mistakes as profits fall for first time in eight years. Available at: https://www.theguardian.com/business/2017/mar/23/next-price-rises-profits-fall-pound-brexit [Available at: 10.03.2022]

Wang, C., Leng, M. and Liang, L., (2018). Choosing an online retail channel for a manufacturer: Direct sales or consignment?. International Journal of Production Economics, 195, pp.338-358.

Wiranata, A.T. and Hananto, A., (2020). Do website quality, fashion consciousness, and sales promotion increase impulse buying behavior of e-commerce buyers?. Indonesian Journal of Business and Entrepreneurship (IJBE), 6(1), pp.74-74.

Xia, H., Pan, X., Zhou, Y. and Zhang, Z.J., (2020). Creating the best first impression: Designing online product photos to increase sales. Decision Support Systems, 131, p.113235.

Yan, Y., Zhao, R. and Liu, Z., (2018). Strategic introduction of the marketplace channel under spillovers from online to offline sales. European Journal of Operational Research, 267(1), pp.65-77.

Zhuang, H., Leszczyc, P.T.P. and Lin, Y., (2018). Why is price dispersion higher online than offline? The impact of retailer type and shopping risk on price dispersion. Journal of Retailing, 94(2), pp.136-153.