Marketing Management 7MK002 University of Wolverhampton Wolverhampton Business School Sch ool
Student Numer ! "##"$07 Module %eader ! William Mott
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Marketing Management
Module ,ode
e&a&'eera'ardana+'lv&ac&uk
Assignment Details
Module name
7MK002
-or the attention of William Mott .ue date
0")"2)20"/
ssignment title
Big Skinny case study
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Contents "& (5ecutive Summary ................................................ .............................................................................. ............................................................ .................................................... ...................... 4 2& Marketing udit ................................................ .............................................................................. ............................................................ ................................................. ................... ......... 5 #& *(S%( analysis and the Macro)(nvironment ................................................ .............................................................................. ........................................ .......... 5 #&" *olitical -actors ................................................ .............................................................................. ............................................................ ........................................................ .......................... 5 #&2 (conomic -actors................................................. ............................................................................... ............................................................ .............................................. ................ ....... 6 # Social -actors ................................................ .............................................................................. ........................................................... ............................................... .................. ............. 7 #&/ %egal -actors ............................................... ............................................................................. ............................................................ ................................................ .................. .............. 8 #&; echnological -actors ................................................ .............................................................................. ............................................................ ............................................... ................. 9 #&< (nvironmental -actors ................................................ .............................................................................. ............................................................ ............................................ .............. 10 /& *orter=s ; forces ................................................ .............................................................................. ............................................................ ........................................................ .......................... 10 /&" hreat of ne' entrants ................................................ .............................................................................. ............................................................ ............................................ .............. 11 /&2 .eterminants of uying po'er .................................................. ................................................................................ ............................................................ .............................. 11 / .eterminants of sustitution threats ................................................ .............................................................................. ..................................................... ....................... 11 /&/ .eterminants of supplier po'er ................................................ .............................................................................. ............................................................ .............................. 11 ;& ,ompetitors ............................................... ............................................................................. ............................................................ .......................................... ............ ...................... ...................... 12
Contents "& (5ecutive Summary ................................................ .............................................................................. ............................................................ .................................................... ...................... 4 2& Marketing udit ................................................ .............................................................................. ............................................................ ................................................. ................... ......... 5 #& *(S%( analysis and the Macro)(nvironment ................................................ .............................................................................. ........................................ .......... 5 #&" *olitical -actors ................................................ .............................................................................. ............................................................ ........................................................ .......................... 5 #&2 (conomic -actors................................................. ............................................................................... ............................................................ .............................................. ................ ....... 6 # Social -actors ................................................ .............................................................................. ........................................................... ............................................... .................. ............. 7 #&/ %egal -actors ............................................... ............................................................................. ............................................................ ................................................ .................. .............. 8 #&; echnological -actors ................................................ .............................................................................. ............................................................ ............................................... ................. 9 #&< (nvironmental -actors ................................................ .............................................................................. ............................................................ ............................................ .............. 10 /& *orter=s ; forces ................................................ .............................................................................. ............................................................ ........................................................ .......................... 10 /&" hreat of ne' entrants ................................................ .............................................................................. ............................................................ ............................................ .............. 11 /&2 .eterminants of uying po'er .................................................. ................................................................................ ............................................................ .............................. 11 / .eterminants of sustitution threats ................................................ .............................................................................. ..................................................... ....................... 11 /&/ .eterminants of supplier po'er ................................................ .............................................................................. ............................................................ .............................. 11 ;& ,ompetitors ............................................... ............................................................................. ............................................................ .......................................... ............ ...................... ...................... 12
<& 1nternal nalysis ................................................ .............................................................................. ............................................................ ....................................................... ......................... 13 <&" he ,ompany ............................................... ............................................................................. ............................................................ ............................................. ............... .............. 13 <&2 SW> nalysis ................................................ .............................................................................. ............................................................ ..................................................... ....................... 13 < SW> 9 >WS nalysis for Big)Skinny ................................................ .............................................................................. ............................................. ............... 14 <&/ -i5ing SW> issues ................................................ .............................................................................. ............................................................ ............................................... ................. 15 7& Mission................................................ .............................................................................. ............................................................ .............................................. ................ ........................ ........................ 15 ?& @ision ................................................ .............................................................................. ............................................................ ......................................................... ........................... ............... 15 $& Segmentation6 argeting argeting and *ositioning ................................................ .............................................................................. ............................................... ................. 15 $&" Segmentation................................................. ............................................................................... ............................................................ ...................................... ........ .................... 15 $&2 argeting ................................................ .............................................................................. ............................................................ ......................................................... ........................... ........ 17 $ *ositioning ................................................ .............................................................................. ............................................................ ......................................................... ........................... ..... 18 $&/ *erceptual Map ................................................ .............................................................................. ............................................................ ....................................................... ......................... 19
Marketing Management 7MK002 University of Wolverhampton Wolverhampton Business School Sch ool
Student Numer ! "##"$07 Module %eader ! William Mott
"0& Strategic >Aectives ................................................ .............................................................................. ............................................................ ................................................ .................. 20 "0&" Big Skinny Strategy ................................................ .............................................................................. ............................................................ .............................................. ................ 20 "0&2 Market >Aectives and Strategies implementation ................................................ ............................................................................. ............................. 21 "0 Market .evelopment Strategy ................................................ .............................................................................. ............................................................ .............................. 21 ""& Marketing mi5 'ith / *=s................................................ .............................................................................. ........................................................... ........................................ ........... 22 ""&" *roduct ................................................ .............................................................................. ............................................................ ......................................................... ........................... ......... 22 ""&2 *roduct ttractiveness ................................................ .............................................................................. ............................................................ .......................................... ............ 23 "" *rice ................................................ .............................................................................. ............................................................ ......................................................... ........................... ............. 24 ""&/ *lace ................................................ .............................................................................. ............................................................ ......................................................... ........................... ............. 24 ""&; *romotion................................................ ............................................................................. ........................................................... ............................................ .............. ................... 25 ""&< >nline dvertising ................................................. ............................................................................... ............................................................ ......................................... ........... ...... 25 12. Budgeting and Financial Planning
................................................ .............................................................................. .................................................... ...................... 29 "#& Sales -orecast for 20"; ................................................ .............................................................................. ............................................................ ........................................... ............. 31 "/& (valuation >f Success ................................................ .............................................................................. ............................................................ ............................................ .............. 33 ";& ,onclusion ................................................ .............................................................................. ............................................................ ......................................................... ........................... ..... 34 Biliography .................................................. ................................................................................ ........................................................... ..................................... ........ .......................... .......................... 35 ppendi5 ............................................... ............................................................................. ............................................................ ............................................. ............... ........................... ........................... 37
Big Sinn! "areting Plan
1. E#ecutive Summar! ear 20"0 Big Skinny ,(> Kiril le5androv 'anted to change from retail distriution
and print advertising to the 'orld of online marketing to achieve ma5imum gro'th& he retail sales pitch 'as an easy one6 as le5androv focused on the value of the 'allet and the impulsiveness of consumers C(delman 3 Kominers6 20""D & ,onverting this type of sales type 'as much harder to do in the 'orld of cyerspace& Bid Skinny centered their online marketing efforts around display ads6 key'ord searches6 social media and relationships 'ith online distriuters and deep discounted sites such as maEon and roupon respectively& he e5pansion caused much hardship6 as Bid Skinny received negative feedack on the revie' 'esite elp that stemmed from their roup on e5periment& hey also faced a glitch in their online promotion that allo'ed /6000 people to order free 'allets from their online store& Big Skinny needs to refocus their online marketing strategy y getting rid of display ds6 refining key'ords searches and severing ties 'ith deep discounted sites& Big Skinny can create value for their product and manage their orders etter y eing more selective 'ith 'ho distriutes their product and y keeping the price steady& more seasonal approach surrounding key'ord searches can create ne' revenue from those 'ho are looking to make :uick and impulsive purchases& %astly6 y eing responsile for 'ho distriutes their products6 Big Skinny can deliver their product in prompt and timely manner6 'hich 'ill resolve the maAority of customer complaints against Big Skinny& o perform a usiness in a successful manner6 marketing plan plays a vital role& Marketing plan also a part of a igger usiness plan& he marketing plan helps the Big)Skinny to focus its goal and oAectives& *rior to design a marketing plan6 marketing consultant need to understand and accumulate enough information aout the competitors and the customers so that marketing consultant can target the right market segment 'ith appropriate strategy& CNiAssen 3 -ramach6 200"D&
2. "areting Audit Marketing audit provides analysis on current position and opportunities of Big)Skinny6
Marketing mi5 analysis6 *(S%6 SW> and >WS analysis& Kotler C"$77D define marketing audit as an instrument to Audge an organiEation=s overall commitment to a market orientation& Marketing audit helps in increasing the profitaility of the company CKotler6 "$$$D&
$. PES%&E anal!sis and the "acro'Environment *(S%( analysis helps in evaluating and managing more precisely the e5ternal factors that affect the Big Skinny usiness and descrie the environment of a specific market y defining the influence factors at political6 economic6 social6 technical6 legal and environmental levels& nd also this 'ill get greater understanding of the e5ternal environment and the market place& he micro environment for Big Skinny is done through *(S%( analysis&
$.1 Political Factors Big)Skinny is operating in a gloaliEed environment& he UK market for leather
accessories like 'allets6 registering an average annual increase of #&2F since 200#6 Aust elo' the (U average of #&/F over the same period CMintel6 200?D& UK government is very strict on laeling6 identification codes&
Factors
(mplication
Probabilit!
(mpact
A)B
Stale overnment
Staility in policy
#
/
"2
1ncrease in ta5es
Selling price of 'allets to increase
<
)/
)2/
1mport and e5port restrictions
.ecrease in sales
7
,hange in international legislations
1mpact on company e5ternal operations
<
overnment recognition
(nhances integrity and customer trust
#
); )#
)#; )"? $
#
$.2 Economic Factors
(conomic factors are of concern to esco6 ecause they are likely to influence demand6 costs6 prices and profits& >ne of the most influential factors on the economy is high unemployment levels6 'hich decreases the effective demand for many goods6 adversely affecting the demand re:uired to produce such goods& hese economic factors are largely outside the control of the company6 ut their effects on performance and the marketing mi5 can e profound& -alling e5change rate (conomic do'n turn *urchasing po'er reduced Unemployment rate of ctoer 20"/& 1nflation at "&2F Sep& "/ British .* gro'th key services drivers are anking6 insurance6 and usiness services&
Factors
(mplication
Probabilit!
(mpact
A)B
1ncome distriution in the country (per capita)
Gigher income6 higher uying po'er
#
#
$
Unfavorale fluctuation in e5change rates
*rice fluctuations
<
)/
) 2/
loal economic turm
.ecline in purchasing po'er
2
-
#
)<
2
-
#
-
(5treme competition in the leather accessory mkt
.ecrease in sales
Manufacturing6 mean'hile6 has declined in importance ut still accounts for aout "0F of economic output& -acing urgeoning pulic deficits and det levels6 in 20"0 the ,M(4>N)led coalition government Cet'een ,onservatives and %ieral .emocratsD initiated a five) year austerity programme6 'hich aimed to lo'er %ondon=s udget deficit from aout ""F
<
Marketing Management 7MK002 University of Wolverhampton Business School
Student Numer ! "##"$07 Module %eader ! William Mott
of .* in 20"0 to nearly "F y 20";& 1n Novemer 20""6 ,hancellor of the (5che:uer eorge >SB>4N( announced additional austerity measures through 20"7 largely due to the euro)Eone det crisis& he ,M(4>N government raised the value added ta5 from "7&;F to 20F in 20""& 1t has pledged to reduce the corporation ta5 rate to 2"F y 20"/& he Bank of (ngland CBo(D implemented as asset purchase program of H#7; illion Cappro5imately I<0; illionD as of .ecemer 20"#& (uropean ,entral Bank6 ut Britain remains outside the (uropean (conomic and Monetary Union C(MUD& 1n economy6 ho'ever6 in 20"# .* gre' "&/F6 accelerating une5pectedly in the second half of the year ecause of greater consumer spending and a recovering housing market& he udget deficit is falling ut remains high at nearly 7F and pulic det has continued to increase C h e W o rl d - a ct oo k6 2 0" / D
$.$ Social Factors @arious cultural studies noted that the culture has significant impact on the uying
ehaviour of the consumers& he culture is the driving force that influences their decisions6 acceptaility of technology and adoption of technology CGofsted6 "$$"D& his has rought significant social and cultural change in not only United Kingdom ut also in other developed economies& More interested in products 'hich are less damaging to the environment& Gand ags and 'allets are seen as an e5pensive to update a style or ne' look& (thical *roducts 1ncrease *ollution through ,o2 emission y cattle %oy groups for animal slaughter in leather manufacturing Shortages of ra' materials for manufacturing leather products
Factors
(mplication
,onstant change in social9cultural environment
.ifferent strategies should e practise
<
,hange in life styles
innovative product range
/
#
.epending on ra' material locally
%ack of ra' material
;
-
1ncrease in social demand and dependaility on the rand
2
#
<
#
#
$
Market leader in 'allet market
1nfluence through maAor events and media
1ncrease in sales
Probabilit!
(mpact
A)B
);
)#0
"2 #
-
$.* &egal Factors
1mprove the protection of human health and the environment and the enhancement of the competitiveness i the chemical industry& @arious government legislations and policies have a direct impact on the performance of Big Skinny& -or instance6 government suggested as enforceale ,ode of *ractice should e set up anning many of the current practices6 such as demanding payments from suppliers and changing agreed prices retrospectively or 'ithout notice CMintel 4eport6 200/D& he presence of po'erful competitors 'ith estalished rands crates a threat of intense price 'ars and strong re:uirements for uyers= po'er can limit entry to this sector 'ith such controls as license re:uirements and limits on access to ra' materials CMyers6 200/D&
";
$.+ %echnological Factors
.ata J Safe Wallets 1ncreasing role of the internet 4ecycled material ,lear travel goods .esign elements Ne' materials .ue to improving of manufacturing techni:ues and process could lead to lo'er prices and innovation 'ithin the market and ne' products could e a ig lo' to the industry& nd also the current technological innovations are not important enough to negatively impact on Big Skinny leather industry& Moreover6 the industry re:uires that the rand has a real presence in social media due to the young)ness of its consumers&
Factors
(mplication
Probabilit!
(mpact
A)B
.evelop 3 implement online social media
1ncrease in a'areness and sales
7
7
/$
,ontinuous technology developments
4educe cost and enhance :uality
#
#
$
Multiple product innovations
,aters to the needs and preferences to UK market
/
7
2?
<
<
#<
echnology level in the industry
Gigh competitive advantage
$., Environmental Factors 1n 200#6 there has een increased pressure on many companies and managers to
ackno'ledge their responsiility to society6 and act in a 'ay 'hich enefits society overall C%indgreen 3 Gingley6 200#D& 1n 200# the government has intended to launch a ne' strategy for sustainale consumption and production to cut 'aste reduce consumption of resources and minimise environmental damage Craiser 3 Scott6 200/D&
*. Porter’s + -orces
he aove diagram developed y *orter as6 echni:ues for nalyEing industries and ,ompetitors C*orter6 "$$?D&
*.1 %hreat o- ne entrants
Factor
"agnitude
hreat of no of ne' entrants
@ery high
(asily copied
Gigh
%o' investment to enter
@ery high
Wallets 'ith asic features
%o'
*.2 Determinants o- bu!ing poer
Factor
"agnitude
Many players in the market to choose from
Gigh
@arious prices to choose from
Gigh
,onsider as a asic impulse product
@ery high
*.$ Determinants o- substitution threats
Factor
"agnitude
Many cheap sustitutes availale
@ery high
/&/ .eterminants of supplier po'er Factor
"agnitude
Since there are more players in the market6 argaining po'er is lo'
@ery high
;& ,ompetitors rnold Wills ccessories J verage 'allet price H70& (stalished in "$/<6 and claims to • e the United Kingdom=s leading manufacturer of accessories6 having its o'n design team
and
'orking
closely
'ith
designer
stores
and
high
street
retailers
C http!99'''&arnold'ills& co&uk 6 n&d&D&
•
.e'hurst .ent J verage 'allet price H#0. ,ompany ased in Bolton& 1ts susidiary .ents is ased in Wilshire and manufactures hand ags6 elts and other small accessories& 1t also has its o'n retail outlets Chttp!99'''&dents&co&uk 6 n&d&D&
•
Marlorough ift Ware J verage 'allet price H/0& manufactures small leather goods and other related products for the gift'are and premium market
•
%auner J verage 'allet price H";/& Manufactures handags6 'allets and small leather goods in a factory near Birmingham6 the traditional center of leather goods manufacturing in the UK C http!99'''&launer&com 6 n&d&D&
•
Marks and Spencer CM3SD J verage 'allet price H"$& With ##0 non)food outlets is one of the most popular destinations for ags and leather goods although it has come under intense competition from discount clothing retailers& Many department stores stock their
o'n
rand
of
items
as
'ell
as
selling
leading
rands
Chttp!99'''&marksandspencer&com 6 n&d&D& •
*ure %u5urious %ondon J verage 'allet price H;0& ,ompany 'as conceived in 200$& >ver ;0 years= e5perience promoting lu5ury rands throughout the UK&
<& 1nternal nalysis
1t=s very important to do organiEation=s internal analysis to take decisions&
<&" he ,ompany (valuating the company=s oAectives6 strategy6 and capailities helps the company to indicate the strength of its usiness model6 'hether there are areas for improvement and ho' 'ell the company fits the e5ternal environment&
<&2 SW> nalysis he SW> analysis is the useful 'ay of directing and managing the internal and e5ternal factors that affect the organiEation& SW> descries aout 'hat the company is at good at6 'hat needs to e improved6 and the other things happening outside the company& SW> stands for Strengths CSD6 Weaknesses CWD6 >pportunities C>D and hreats CD&
< SW> 9 >WS nalysis for Big)Skinny (nternal Strengths
(nternal /eanesses
4etail distriution e5perience
Minimum online e5perience
hinness and lightness
%ack of techni:ues&
marketing
Machine 'ashale Water resistant .ifferentiated products E#ternal 0pportunities
S0
Ne' fashions every year
4etail distriution e5perience and online marketing 'ill give synergy effect&
>nline Marketing (thical and green marketing
hinness and lightness feature 'ill go 'ith ne' fashion&
Not having proper usiness strategy& poor advertising e5pansion strategy /0
and
*rofessional to handle online operation& (5pert to handle marketing division&
UK small accessories 2;$ million Machine 'ashale 'ill e highlighted in ethical and green marketing& %ess slipperiness interior 'ill e uni:ue feature to reach 2;$ million market&
4ecruit :ualified person to handle usiness and advertising strategies&
E#ternal %hreats
/%
S%
(5porters from ,hina and 1ndia With innovative differentiated 'ith latest technology& products to compete against ,hinese and 1ndian products& ,hanging ehaviors of customers& >ffer versatile product to meet customer e5pectation& Many manufacturers have their Use Kiril=s distriution o'n retail chains& e5perience to have a good retail (U and developing counties chain& S'itch country Manufacturing sources&
,reate competencies to overcome the poor online e5perience& (5pert to challenge the threats to overcome the issues& 4ight resources to challenge e5pansion and advertising&
<&/ -i5ing SW> issues -or the strengths9opportunities6 Big Skinny can use L'ord of mouth campaign to promote the rand& 1n the case of the 'eakness9opportunities6 the company can come out 'ith economical version of their products as 'ell as coming out 'ith ne' features& nd in order to deal 'ith threat issues6 Big Skinny can promote positive marketing campaign against the environmental concerns and make sure competitors don=t take over&
7& Mission Bringing a creative6 stylish and uni:ue high :uality 'allet to the young and mature through providing a superior customer satisfaction in a profitale and highly efficient manner y getting "F market share in 20"7&
?& @ision We elieve in step y step progress and dream aout a uncompromised modern production house 'ith creative and innovative products 'hich eventually 'ill ecome a one wallet for Lany 3 all kind of synthetic leather products and accessories&
$& Segmentation6 argeting and *ositioning $&" Segmentation Segment 1 ge "? J 2; male Coung SportyD Characteristics his segment of men are very fashion conscious& 1t=s very important to them
that they use the right rands and have the right look& hey do not have huge amount of money to spend on accessories like 'allets and to get the right look& hey 'ant to look individual and their selections to reflect 'ho they are6 ut 'ith their limited udget they have to choose carefully& hey elieve that in order to look good it=s important to have an occasional item that is more e5pensive and :uality& Sometime they spend highly on a key item to get something that
look superior& hey do not care aout over spending on an item if it is something that they really need& hese men like to uy their clothes and accessories 'ith cash and 'ill shop in to'ns6 rather than out of to'n& hey also heavily use internet C-ashion Segments Gand Book6 n&d&D&
Segment 2 ge #; J ;0 Men C Mature D Characteristics
Most of the people 'ho elongs to this category are not particular aout
rand& t this stage most of the men may e fathers& Spend per purchase is slightly elo' average reflecting the fact that :uality is not high priority& hey favour out of to'n shopping canters and proaly make trips to retail parks 'ith their family& *urchases are likely to e made y each family memer during these trips& *eople elong to this type are not e5perimental in their choices of their o'n clothes and accessories and they are not looking for individuality in the clothes that 'ear& hey do not rate rands or laels importantly 'hen they are choosing 'hat to uy& *urchases are usually made y credit cards& 1n this marketing plan6 Big Skinny=s market 'ill e segregated in to t'o segments& hey are the people 'ho are aged at "? J 2; youth and people 'ho are aged at #; J ;0 mature groups C-ashion Segments Gand Book6 n&d&D&
$&2 argeting Segment 1 Age 13 42+ 5oung male
-ashion Segments Gand Book United Kingdom total population is ,$ million& ged "? J 2;
! *.$ million C<&77FD Cas per the aove dataD&
arget in units ! "F of / million J *$6777 units arget value
! /#6000 units 5 H"; ) H;6000 Cper annumD
Segment 2 Age $7 4 +7 "ature male
Marketing Management 7MK002 University of Wolverhampton Business School
Student Numer ! "##"$07 Module %eader ! William Mott
-ashion Segments Gand Book United Kingdom total population is ,$ million& ged #0 ) ;0
! $.3 million C<&"0FD Cas per the aove dataD&
arget in units ! "F of #&? million J $36777 units arget value
! #?6000 units 5 H2; ) H$;06000 Cper annumD
$ *ositioning
Segment 1 ge "? J 2; oung male
%ess affordaility6 less electronic cards6 change 'ith the trend6 less thickness 1deal type of 'allets ) B1)->%. Wallets Branding ! Brand name is 85'Fold9 C Bi)-old for oungD
Segment 2 ge #; J ;0 Mature male
Gigh affordaility6 Use lot of electronic cards6 change 'ith the trend6 less thickness6 sometime like to keep moile phone in same 'allet& 1deal type of 'allets ) 41)->%. Wallets6 ,(%%*G>N( Wallets Branding ! Brand name is 8"'Fold9 C ri)-old for MatureD
$&/ *erceptual Map
:igh Price
%aunerCH";/D rnold 'illsCH70D *ure lu5uriousCH;0D .e'hurst .entCH#0D &o ;lt!
:igh ;lt!
MaloroughCH/0D "'Fold
M3SCH"$D 5'Fold &o Price
Marketing Management 7MK002 University of Wolverhampton Business School
Student Numer ! "##"$07 Module %eader ! William Mott
"0& Strategic >Aectives
Strategy is aligned 'ith SM4 theory& o gain the market share y "F in UK market 'ithin three years C20"7D through penetrating pricing and loss leader pricing strategy& his oAective goes straight 'ith Big Skinny=s mission statement& "& o achieve a sale of H"&;million in 20"; and an incremental increase "0F year on year& 2& o achieve a sale of )-old of H;6000 y end of 20"; and incremental increase of "0F 20"< and 20"7& #& o achieve a sale of M)-old of H$;06000 y end of 20"; and incremental increase of "0F in 20"< and 20"7& /& ,reate Brand a'areness and e5ecution through online and Bric and Motar promotions to achieve the aove oAectives&
"0&" Big Skinny Strategy 1n order to achieve aove set oAectives6 market penetration and product differentiation 'ill e used 'ith Big Skinny=s significant competitive advantages& Big Skinny can uses another strategy of differentiation6 than it has to try to offer products 'ith uni:ue features that customer=s value& Big Skinny 'ill e ale to create rand loyalty through innovativeness for the products offerings6 and thus6 price inelasticity on the part of uyers& Breadth of product offerings6 technology6 special features or customer service is popular approaches to differentiation C*orter6 "$?0D&
"0&2 Market >Aectives and Strategies implementation
Strategy frame'orks and structuring tools are keys to assessing the usiness situation& 4isk and value trade)offs are made e5plicit6 leading to concrete proposals to add value and reduce risk& (5plicit plans for action6 including effective planning need to e developed y Big Skinny as the strategy alternative& -rom strategy discussed aove6 ig Skinny is likely to e primary market oAectives of focus on market development through partnerships and diversification through ne' product development&
"0 Market .evelopment Strategy
s an e5pansion strategy entering to ne' market like UK can serve as a key gro'th driver of the company=s revenues& Big Skinn y=s interests in UK to continue gro'ing in due course6 as (uropean market is sho'ing as increase in consumer spending& he UK market is also demographically high opportunity market& he success of the market development strategy 'ill e related to three main success criteria& hey are sustainaility6 acceptaility and feasiility& Sustainaility 'ill e concerned 'ith 'hether a strategy addresses the circumstances in 'hich the company is operating& 1t is
aout the rationale of this e5pansion of market development strategy& he acceptaility relates to the e5pected return from the strategy6 the level of risk and the likely reaction of customers& -easiility 'ill e regarded to 'hether Bid Skinny has the resources and competence to deliver the strategy&
""& Marketing mi5 'ith / *=s
""&" *roduct
(ntering a ne' market 'ith an e5isting product involves in market development Cnsoff6 "$;7D& Big Skinny can highlight its various products 'ith features to enter in to ne' market& his diversification of products 'ill sho' their innovative skills& Big Skinny should improve their e5isting product and use market research6 product adaptation analysis6 and legal revie' to seek e5pansion for the e5isting products CMc.onald6 2007D&
Brand name for segment " 'allet ! 85'Fold9 Brand name for segment 2 'allet ! 8"'Fold9
Marketing Management 7MK002 University of Wolverhampton Business School
Student Numer ! "##"$07 Module %eader ! William Mott
s per the aove figure it=s clearly sho's that ho' the leather goods market eing distriuted in 200$& Wallets elong to small accessories market and share 'as "7&
""&2 *roduct ttractiveness
Big Skinny 'allets are ) ultra)thin6 flat6 superior design and durale material ) special grip6 light'eight6 'ater resistant6 fle5ile6 Several colors and forms ) 0" year 'arranty
Marketing Management 7MK002 University of Wolverhampton Business School
Student Numer ! "##"$07 Module %eader ! William Mott
"" *rice
*rice for Segment "'allet L)-old <1+ *rice for Segment 2 'allet LM)-old! <2+ *ricing in the leather and 'allet accessories have fallen over the years& 1mport prices of leather accessories also reduced since 200/6 #&
""&/ *lace
Super markets6 clothing stores
gents or 'hole sale
'''&the'holeseller&co&uk '''&fairtrade'holesale&co&uk • •
.epartment stores retail outlets C$7 out letsD hrough 1nternet6 '''&accessoriesstudio&com
""&; *romotion Booth dvertising *rint dvertising 1n *ersonnel Sales *ostcards on restaurants .epartments stores 4etailers rocery Multiple stores
""&< >nline dvertising
Although there as an economic donturn in 27176 online advertising continued to gro ith ne -ashion based ebsites. Success stories have been dedicated ith sites such as http.m!ardrobe.com6 hich onl! sells online and onl! sells the latest -ashion clothing and accessories. 0ne reason -or the success o- this ebsite is their use o- ell' non brand names to attract consumers to visit them =CB( "aret Surve!6 2717>. :ence no ?@ econom! is in upard trend6 there are man! more opportunities to attract bu!ers.
.isplay ds J distract site users *roduct -eeds)o search engines S(> optimiEation J Words at the ottom of the line Search ds J *er click Social Media 1nteractive content >n line relationship selling Social Media
11. 0ptions %o pursue in digital mareting
Ne' ,onsumers through Search engines (5isting ,ustomers6 through social media and interactive media& 4etail *ortals like maEon and Buy &com
Gence most of the consumers do research products online efore they uy8 Lonline marketing has
ecome very important tool today& here are many 'ays
to uild
usiness attractively online&
an
Feb
"ar
Apr
"a!
&ocal listings ) classi-ieds Search engine advertising Conte#tual ads Displa! ads eotargeting roup bu!ing "obile mareting Social netoring sites A--iliate mareting
"onth ise online advertising plan -or !ear 271+
un
ul
Aug
Sep
0ct
ov
Dec
•
&ocal listings and classi-ieds 4 ,reate usiness listing on listing sites such as ,ity search
to ensure that consumers searching for neary usinesses find ours& •
Search advertising 4 Method of placing online ads on 'e pages6 near search engine
results& •
Conte#tual ads 4 .isplay ads to the ne5t level6 y placing them on sites related to my
offerings& •
Displa! ads 4 *roaly seen the dancing aliens& hat=s a display or anner ad&
•
eotargeting 4 Simply means advertising to prospects in specific locations6 'hich 'ould
e very useful& •
roup Bu!ing 4 ,onnect 'ith ne' customers through programs that offer multiple
uyers6 collective purchasing deals& •
"obile mareting 4 Many smart phones and moile devices provide 'e ro'sing6
cameras and video capailities& •
Social netoring sites 4 ,ultivate ne' usiness through social net'orking sites 'here
memers share their ideas& •
A--iliate mareting 4 o get other usinesses to drive prospects to my o'n 'esites&
an
Feb
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Apr
"a!
un
ul
Aug
Sep
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ov
Dec
an
Feb
"ar
Apr
"a!
un
ul
Aug
Sep
0ct
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Dec
0nline P 0nline relationship communication 0nline sales promotion
0--line Advertising
0utdoor advertising =print> P and publicit! Personal selling
•
0utdoor advertising 4 *rints6 roadcast ads6 rochures6 posters6 leaflets6 illoards etc&
•
P and publicit! 4 *ress kits6 speeches6 seminars6 annual reports6 company magaEines&
•
Personal selling 4 Sales presentations6 sales meetings6 fairs6 trade sho's6 events
Business ttractiveness
Ne' fashions every year rends to'ards online sales rends to'ards ethical fashion rends to'ards innovative products ,ost effective manufacturing Wide range of departmental stores C?00D Wide range of 4etail outlets C$000D
A substantial ris o- -ailure ne business entries to ?@ maret
s per the figure 2 sho's aove6 failure rates are high 'ithin the first five years of starting a usiness6 typically around /0 J ;0F6 'ith the highest failure in the first year& 4ecent studies in UK have sho'n higher survival rates for ne' ventures in innovative industries like Big Skinny CGelmers 3 4ogers6 20"0D& here are various reasons 'hy ne' usiness fail and close&
12. Budgeting and Financial Planning
Budget planning is a continues process of directing and allocation financial resources to meet strategic goals and oAectives& he result as output from financial planning takes the form of udgets& he most 'idely used from of udget is Budgeted -inancial Statements& he foundation for Budgeted -inancial Statements is .etail Budgets& .etail Budgets include sales forecasts6 production forecasts6 and other estimates in support of the -inancial *lan& ,ollectively6 all of these udgets are referred as the Master Budget& We can also reak financial planning do'n into planning for operations and planning for financing& >perating people focus on sales and production 'hile financial planners are interested in ho' to finance the operations& herefore6 'e can have an >perating *lan and a -inancial *lan& Go'ever6 to keep things simple and to make sure 'e integrate the process fully6 'e 'ill consider financial planning as one single process that encompasses oth operations and financing&
•
%otal promotion budget allocation -or the !ear 271+ ' <76777=,G o- the sale>
•
Brea don o- the promotion budget is allocated as -ollos 6
Budget splitG -or the three !ears =271+ 4 271> Budget Categor!
271+
271,
271
Advertising
25%
20%
25%
Public elations
5%
5%
5%
0nline promotions
25%
30%
30%
Sales Promotions
15%
25%
20%
Social "edia
10%
10%
10%
Personal Selling
20%
10%
10%
%otal
100%
100%
100%
-inancial *lanning is a continues process that flo's 'ith strategic decision making& he >perating *lan and the -inancial *lan 'ill oth support the Strategic *lan& he est place to start in preparing a udget is 'ith sales since this is a driving force ehind much of our financial activity& Go'ever6 'e have to take into account numerous factors efore 'e can finaliEe our udgets&
Budgeting should e fle5ile6 allo'ing modification 'hen something changes& -or e5ample)6 the follo'ing 'ill impact udgeting! •
%ife cycle of the usiness
•
-inancial conditions of the usiness
•
eneral economic conditions
•
,ompetitive situation
•
echnology trends
•
vailaility of resources
Budgeting should e oth top do'n and ottom up 'ill 'ork to finaliEe a udget& We can streamline the udgeting process y developing a financial model& -inancial models can facilitate L'hat if analysis so 'e can assess decisions efore they are made& his can dramatically improve the udgeting process&
Marketing Management 7MK002 University of Wolverhampton Business School
Student Numer ! "##"$07 Module %eader ! William Mott
>ne of the iggest challenges 'ithin financial planning and udgeting is ho' do 'e make it value)added& Budgeting re:uires clear channels of communication6 support from upper)level management6 participation from various personnel6 and predictive characteristics6 udgeting should not strive for accuracy6 ut should strive to support the decision making process& 1f 'e focus too much on accuracy6 'e 'ill end)up 'ith a udgeting process that incurs time and costs in e5cess of the enefits derived& he challenge is to make financial planning a value)added activity that helps the organiEation achieve its strategic goals and oAectives&
"#& Sales -orecast for 20";
an
Feb
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Apr
"a!
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Aug
Sep
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Dec
%otal
/000 <000 2000 2000 2000 ;000 ;000 ;000 2000 2000 ;000 #000 *$6777 5' Fold ;000 ;000 #000 2000 2000 2000 #000 #000 2000 2000 /000 ;000 $36777 "' Fold 11777 +777 *777 *777 777 3777 3777 *777 *777 777 3777 31777 Sales 777 units Sales "?;000 2";000 "0;000 ?0000 ?0000 "2;000 ";0000 ";0000 ?0000 ?0000 "7;000 "70000 1++777 value
• •
•
• •
•
Ne' year celeration in Oanuary& th
-rom last 'eek of Oanuary to -eruary "/ 'allets sales goes up 'ith @alentine=s day celeration& %ast 'eek of Oune to ugust Summer sales in UK& *eople spend on gift items and others due to half price and discounts offers& his period also summer holidays for university students& hey do part time Aos and spend lot on accessories and gift items& here are no special events in Septemer and >ctoer& Novemer in UK they celerate Black)-riday& *eople do lot of purchases due to special discount offers& .ecemer ,hristmas celeration&
7000 6000 5000 400 0
Y Fold M Fold
300 0
2000 1000 0 Jan $e
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
O!
"o#
5 Fold ) " Fold sales in units
ove chart sho's clearly that the proAection forecast of 85'Fold9 and 8"'Fold9 for the year 20";& otal proAected )-old 'allets for the year 20"; are /#6000 units6 and value 'ise its H;6000& Gighest forecast of <000 units planned 'ith )-old for the month of -eruary6 align 'ith @alentine=s celeration& -rom end of Oune to ugust there are summer holidays in UK& University students also get their vacation and they do part time Aos and spend on their fashion and clothing& 1n Novemer UK people highly celerate Black)-riday6 and they do shopping to enAoy special discounts and other special offers& /000 units of )-old are planned in Oanuary 'ith Ne' ear season& 1n March6 pril6 May6 Septemer and >ctoer there are no special events and proAected 2000 units of )-old in each month&
otal proAected M)-old 'allets for the year 20"; are #?6000 units6 and value 'ise its H$;06000& s per the aove chart 1 have proAected special forecasts align 'ith special events& 1n month of Oanuary ;000 M)-olds proAected 'ith Ne' ear season& 1t 'ill e ale to maintain the same sale in month of -eruary also 'ith @alentine=s celerations& .ecemer also highest sale of ;000 units of M)-olds e5pected 'ith ,hristmas season and annual onus& Ne5t highest sales of M)-old /000 units proAected in month of Novemer align 'ith Black)-riday& 1n month of Ouly #000 units of M)-olds planned for the L-ather=s .ay celeration& Maintain same sale of #000 M)-olds in month of ugust 'ith summer holiday shopping season& Since there are no special events in March6 pril6 Septemer and >ctoer 1 have planned to maintain sale of 2000 units each month&
"/& (valuation >f Success
here are various dimensions of success like productivity6 profitaility and gro'th& ro'th can e measured in terms of market share of the product or company Big Skinny& 1f there is a gro'th in market share of the Big Skinny6 it=s indicates the Big Skinny is gro'ing as compared to the competitors& company only gaining market share does not indicates that the company is doing 'ell until and unless they are productive and profitale CBald'in 3 ellatly6 200#D& 1n this case Big Skinny should evaluate their performance every year 'ith the forecasted outcome and oAective that they 'ant to achieve& Behind the marketing plan the company has to do significant amount of investment& nd also the company has to measure the return on this investment in order to see 'hether the investment is generating e5pected income& t the same time company should also measure 'hether their market share is increasing as compared to the market share of the competitors& he Big Skinny should evaluate their performance at regular interval and change their strategies if the e5pected result is not achieved&
";& ,onclusion
he success of the Big Skinny sho's ho' far the randing can come in moving eyond splashing one=s logo on a illoard& 1t had fostered po'erful identities y making their marketing concept into a virus and spending it out into the culture via a variety of channels& s entering to a me' market in a rapidly changing usiness environ ment 'ith a high competitors= pressure Big Skinny have to adopt ne' e5pansion strategies or diversified the e5isting6 in order to enter to UK market& he company must constantly adapt to the fast changing
circumstances& Strategy formulation should therefore e regarded as a process of continuous learning6 'hich includes learning aout the goals6 the effect of possile actions to'ards these goals and ho' to implement and e5ecute these actions& he :uality of a formulated strategy and the speed of its implementation 'ill therefore directly depend on the :uality of Big Skinny=s cognitive and ehavioural learning processes& Big Skinny should analyse its strategies and implemented at various levels& hese different levels of strategy should e related and mutually supporting& Big Skinny=s strategy at a corporate level defines the usinesses in 'hich Big Skinny 'ill compete6 in a 'ay that focuses resources to convert distinctive competence into competitive advantage&
Bibliograph! http!99'''&arnold'ills&co&uk
6
n&d&
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vailale at! http!99'''&arnold'ills&co&uk http!99'''&launer& com
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vailale at! J http!99'''&launer&com ) nsoff6 1&6 "$;7& Strategies for diversification& Harvard Business Review. Bald'in6 O& 3 ellatly6 &6 200#& Innovation Strategies and Performance in small firms. Massachusetts! (d'ard (lgar& ,B1 Market Survey6 20"0& The Luggage and leather good maret in !". P>nlineQ vailale
at!
http!99'''&ci&eu9system9files9marketintel920"020)
20luggage20and20leather20goods20)20United20Kingdom2&pdf (delman6 B& 3 Kominers6 .&6 20""& #nline mareting at Big Sinn$% s&l&! Garvard Business School& -ashion
Segments
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strategies9rochures9fashionRsegmentsRhandookRmalesRsmallP"Q&pdf raiser6 & 3 Scott6 &6 200/& Understanding the dynamics of the supermarket sector& The Secured Lender% Novemer9.ecemer6 <0C
Gelmers6 ,& 3 4ogers6 M&6 20"0& 1nnovation and the survival of ne' firms in UK& Review of industrial organi'ation% @olume #
Gofsted6 &6 "$$"& ,ultural .imensions& Human Resource. http!99'''&dents&co&uk vailale at! http!99'''&dents&co&uk
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Marketing Management 7MK002 University of Wolverhampton Business School http!99'''&marksandspencer& com
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Student Numer ! "##"$07 Module %eader ! William Mott n&d& P>nlineQ
vailale at! http!99'''&marksandspencer&com Kotler6 *&6 "$$$& areting How to create% win% and dominate marets. % Ne' ork! Simon and schuster& %indgreen6 & 3 Gingley6 M&6 200#& he impact of food safety and animal 'elfare policies on supply chain management&& British &ood *ournal% "0;C
Marketing Management 7MK002 University of Wolverhampton Business School
ppendi5
Student Numer ! "##"$07 Module %eader ! William Mott
Marketing Management 7MK002 University of Wolverhampton Business School
Student Numer ! "##"$07 Module %eader ! William Mott