The Running Room Analysis

The Running Room Analysis

Introduction

John Stanton wanted to start running to improve his health. He went to a big sports shop to purchase a pair of shoes for the sport but there was no pair that was pleasant to him. The salesmen in the shop were struggling to please him with the pair of shoes that would give them the highest commission. They disregarded the needs of the customer. From here, Mr. Stanton saw an opportunity that would help him get the people who had faced his experiences. He decided to start up a business that would focus solely on runners and try to provide for all their needs. Such needs included t-shirts and shorts for running, beverages and sports, timers and any other thing that a runner would require in his daily training. He wanted to completely fill the gap that the big shops left. This was immediately a success because many people were disgruntled by the kind of services that they received from the big shops. He has since improved the services at RR and is among the biggest running commodities outlets in the United States and Canada.

This report will seek to determine the things that Stanton did right leading to his success in his business. It will look at the consumer trends and insights surrounding the marketing environment that Mr. Stanton was seeking to fill. It will also elaborate the types of research methods that Stanton employed, which included exploratory, qualitative and causal. Further, the paper will look into the consumer behavior that helped set up Running Room. It will also look at the strategies that the RR management used in their customer relationship management as well as the market segmentation approach that led to their large success.

Mr.Stanton determined the gap in social classes and utilized it. He understood tat some people were looking for high quality products and were not influenced by the cost of the goods they bought, as long as they were of the quality they liked. Economic and utility concepts of the customers were the main issue that needed to be considered.

Consumer behavior and trends eventually determines the performance of any business. The marketing environment that a business idea is introduced is vital in determining whether a business would thrive or would not. The market environment consists of different forces, some affecting the market negatively while others affecting the business positively. If a thorough scan of the market is conduced, the entrepreneur has fewer risks of poor performances in the business. When Running Room started off, the market already contained a void that they attempted to fill. The big sports shops were not thorough and critical with the coverage of all the market segments. The socio-cultural forces in that market environment impacted positively because people of all walks wanted to keep fit with their bodies, but not all were accommodated in the market. Further, the demographic and economic forces were positive on the business because most people in the society were willing to work out to reduce the risks of lifestyle related diseases in the United States. They were willing to spend the money they already had for the sake of their health. On the other hand, competition impacted negatively because Running Room was a new entrant into the field that other outlets had already made their name and proved to be very competent. His is usually a force that discourages many people but proper planning and marketing strategies always win the day.

Types of Research

In order to start up the business, Mr. Stanton had no idea on whether an opportunity was available. He only learnt it when he could not find a good pair or running equipment in a big shop. He used all the three forms of research to come up with the determination to start up the Running Room. At some point, he would mention the business in situations that were unplanned which was a form of causal research. He conducted an exploratory research to determine whether his observation was correct. He used qualitative research as well as a causal research in the whole plan.

Mr. Stanton was wanted to start to keep his body fit and it was during the search for the best shoes to use that he learnt that there was an opportunity. This can be called a causal research which is facilitated by the cause and effect. He was disappointed by the lack of his equipment and decided to start up his own shop. Mr. Stanton met Kelvin Higa during a training session. Hey became friends and this led to them becoming friends and sharing business ideas. This is how they started running training classes. This could be termed as an exploratory research because there was no specific thing that they were researching about, yet they came up with a business idea. In order to determine the needs of the customers, Running Room has come up with a perfect response channel from customers from where they picked their feedback. This can be termed as a qualitative research.

Customer Relationship Management

Customer relationship is key to the success of any business enterprise. Poor handling of customers or potential customers leads to dropping of sales and an eventual fall in business (Mark, 2007). First, RR has remained focused on their target customers. Mr. Stanton realized that there were many people who shared his sentiments and felt that they needed to be satisfied. He used the strategies as outlined by Cristian, Kuester & Krohmer, (2009) to get into the market. He, from experience, understood what the customer wanted and he started to focus on providing the best services and goods that runners would require in their trade without difficulties that he faced. Secondly, he developed the target customers and started to provide them with everything they wanted. As stipulated by Kerin, Hartley, Rudelius, & Clements (2011) on the need to specialize, he built his business around running goods under one roof and even named the premise Running Room. He offered his customers goods that ranged from clothing to body relaxers and nutritional goods and information. At a later date, he invited Kevin who helped him to develop a training education service. From these strategies, RR acquired customers who felt that the big sport shops neglected them. Finally, RR has continually improved their services through the use of internet where customers can even shop from their offices through their online marketing and sales services. There has been diversity on the services offered because there are people who run to keep fit and need guidance on how to do it. Running Room has introduced these services leading to the retention of their customers over the years.

Market Segmentation

Target market is a vital way to keep a business thriving and performing well (Mark, 2007). One needs to segment the market in order to reach out to the targeted market (Kerin, Hartley, Rudelius, & Clements, 2011). Mr. Stanton waned to reach out to the runners who wanted to do their job in their best environments.  He missed to get the best pair of shoes for his running from a ‘big box’ because these big shops were mainly geared to make profits. Salesmen would struggle to convince the runners to buy shoes that would give them (salespeople) the highest commission, without a consideration on whether the runner liked the shoes or not. The big boxes did not focus on the individuals. Mr. Stanton capitalized in this individualized marketing. His first priority was the comfort of the runner and profits would come later. Secondly, he used niche marketing which targeted runners alone. All the needs of a runner, including supplements and clothing that people need while running, were put into consideration which is key to business development (Kerin, Hartley, Rudelius, & Clements, 2011). This ensured that any runner would get anything they needed under one roof. Products ranged widely but were all centered on the sport. Later, running lessons were introduced with a new service getting nod in the Running Room. This shows that the niche was well covered by the time Mr. Stanton completed his business creation

Conclusion and Recommendations

It is evident that there are many areas that have not been exploited. Proper market target and determination of the needs of the customers would ensure that there is satisfaction from the customers leading to their belief that the facilities they visit offer the best services or goods (Kerin, Hartley, Rudelius, & Clements, 2011). It is always good to put the interests of the customer ahead of profits because an exemplary customer relationship with the business would lead to the increase in sales and subsequently profits.

A business enterprise should have a framework that would ensure that there is a void in the market that they wish to fill (Cristian, Kuester & Krohmer, 2009). They should not set up businesses without a through research that would ensure that they are aware of the specific people who they need to target in their business; poor planning before setting up a business could result into unhealthy competition with the businesses who have already established their status in the market and industry. Running Room is doing well in their service delivery and in determining the needs of their customers. They however need to come up with new delivery strategies so that they can reduce the time lost before customer’s orders are delivered.