The Dongmen branch of Moi Deparment Store announced record profits of 70 million yuan (US$8.5 million) during its recent promotion where it kept its store open for a marathon 63 hours non-stop with a "buy 100 yuan get 100 yuan coupon" offer.

"We aim to provide consumers with better deals and to inject more adrenaline into Shenzhen's retail sector during a normally sluggish time of year," said Cheng Yongjiang, Moi's planning department manager.

Their promotional campaign paid off and lived up to its objective. Dongmen Commercial Area, the city's oldest shopping district attracted people from all over Shenzhen to join in the shopping carnival. Two other major department stores Rainbow and Sun also launched sales, offering discounts of up to 50 percent on items, to counter their rival.

"Retailing is a very sensitive industry. If you don't respond to your rivals in time, you lose your market share," said Cao Ping, Rainbow's planning department manager. "We have demanded discounts from our suppliers, so we can afford the promotion. Even though the price has been slashed tremendously, we still need to make a profit."

Cao said Rainbow's Dongmen branch also saw its sales revenue increase by eight times during the promotion period.

Marketing style reflects the company's corporate culture. Though maximizing profits remains the unchanged objective, different department stores still realize that offering a discount is just one way of marketing. "We will launch an autumn and winter fashion festival in mid November, providing a free consultation service for cosmetics and clothes and providing information on the latest fashion styles. Engaging in a price war is definitely not the only way to attract customers," said Cao Ping.

Though Moi took the lead this time, they still had a lot to offer to satisfy more consumers. "Each of our branches target a certain group of customers. For example, the Dongmen branch targets middle-income consumers, while the Huaqiangbei branch is more oriented to middle and high-income consumers. In the future, we will expand our range of target groups," said Cheng Yongjiang.

Currently, the supply of most products exceeds the real demand and price sensitivity is a key factor in the retailing industry. As a result, offering price reductions is unavoidable in today's market. Even though most department stores are not willing to slash prices, they are often made to do so.

Fortunately, many department stores including Moi, Rainbow, Seibu and Friendship have realized that improving their service and competitiveness is essential to the company's long-term development. They are now focusing more on training employees, offering after-sales service and VIP membership to improve customer satisfaction.

Editor: Donald