The case covers a period of time when Kinko’s, having grown to almost $2Billion in revenues was shrinking in two of their three market segments. Kinko’s revenues in the Customer Segment and Local business segment were shrinking at 6% and 5% Year-on-year between 2002 and 2003. Only the commercial segments solution was growing at a respectable 5% annually. The main issue facing Kinko’s at this point was: Who are the customers they should be focusing on and how?
Both the questions pertained to the business strategy, and flowed from the Marketing Objectives, which in turn derived from the Master Marketing Strategy, encompassing competitor analysis and SWOT analysis. Who should Kinko’s focus on?
Strategically, Kinko’s had to make a choice between Focusing on Commercial Business and Overhauling the Retail Business. The Retail segment was a shrinking market with the rate of decline expected to accelerate with technology substitution, while Commercial Business, encompassing both FM and non-FM, was a large and growing market. So, Kinko’s would absolutely have to focus on Commercial Business to maintain growth. How should Kinko’s position itself to achieve this focus? The competitor analysis is readily available from Exhibit 8, which compares Kinko’s vs competition on various criteria. It is notable that Kinko’s scores lower than its competition on a lot of criteria regarded as important (Price, quality, speed, experience) and scores higher than competition on online order placement, variety of products and multiple locations, criteria not very important in the Commercial/FM business. It is clear that to attack this segment Kinko’s should focus on reducing price, and improving quality, speed and experience. It could do this from the savings gained by consolidating its store locations and rationalizing its product offerings. What about Kinko’s Retail customers?
Retail customers, who included individual consumers and small local businesses, comprised 80% of Kinko’s...
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