Bsb126 marketing plan - received a 5 PDF

Preview

Summary

received a 5...

Description

Levi Strauss & Co

BSB126 Marketing Plan 2020 Yi-Tien (Tammy) Tsai

Word count: 1780

1

Levi Strauss & Co

Situation analysis Fashion is a language that creates itself in clothes to interpret reality- Karl Lagerfeld. On average, people in Australia spends about $20.5 billion on clothes, with the current pandemic issue, e-commerce market segment fashion has explicitly grown to about 18.3 million users in 2020 (Statista, 2020). Levi is one of the world’s largest brand-name apparel companies and a global leader in jeanswear. Levi products are sold in more than 110 countries globally with the combination of chain retailers, department stores, online sites with a total of approximately 3,000 retail stores (Levi Strauss, 2020). A SWOT analysis (appendix 1) indicated both potentials and weaknesses of this innovative company. Additionally, some environmental factors have been revealed in relation to affecting the company’s operation.

Social Trend With such an extensive portfolio, Levi needs to grow its business continuously for the company to remain and pass on its heritage as one of the top brand-name apparel. As Levi focuses on denim clothing, it brings a unique market (Levi Strauss, 2020). However, the current social trends suggest that more millennials are switching up the look of traditional denim style to a “more comfortable” look such as sweatpants or yoga pants from brands like Lululmon and Nike (PYMNTS, 2016). As nowadays that people are seeking for a healthier lifestyle, the percentage of consumers purchasing activewear has rapidly inclined in the past few years. Therefore, this indicates that Levi should perhaps extend its clothing line or create a sub-brands.

Technology As social media becomes a part of people’s life, influencers such as celebrities and models advertise luxury clothing, people view it as a fashion trend to follow as influencers support the brand (Wilberg, 2018). Which leads to the increased percentage of people’s demand on luxury clothing, hence consumers would want to spend more on one item for it to be “instagram-worthy” but not a traditional blue jeans that everyone has in their wardrobe. Therefore, this indicates that Levi should perhaps have collaborations with luxury brands or activewear brands such as Channel, Nike or Off-White to attract consumers (Wilberg, 2018). Another technology impact is e-commerce stores, as the internet makes people’s life more convenient day by day, there has been an incline of trend with e-commerce stores. Research shows that in 2019 there'll be approximately 17.5 people shopping on e-commerce stores but only 9.9 million people shopping in apparel, which is about double of the number that e-commerce stores are getting (Ibisworld, 2018). On the other hand, e-commerce stores tend to make more profit as it doesn’t require a physical store, which means;less employees and no rent.

2

Levi Strauss & Co This is also another opportunity for Levi to expand its brand whilst using social media to advertise itself.

Marketing goal Levi Strauss & Co. aims to earn total revenue $7 billion in the next financial year, increasing from $5.8 in 2019. As the Ansoff Matrix (figure 1) indicates the product development plan for Levi.

Marketing strategy Target market The segmentation analysis displays the target market introduction for Levi. As suggested in the table, the target market for Levi are families with kids age range 15-25, who are in the middle to high income bracket, with a brand loyalty to Levi. Table 1: Segmentation Analysis Segmentation Method

Segment

Description

Geography

All around Australia

All clothing retail stores in Australia, for both bigger or smaller store such as: Myer and David Jones or General Pants and Glue

Demographic

Children age from 15-25

Teenagers and young adults that’s mostly influenced by

3

Levi Strauss & Co

social media and are concerned about their physical appearance, judging on their outfit can boost the sale. Parents age from 35-55 that Has a job that provides the family middle to high Income

Levi jeans price is about $100 each pair, which is actually concerned to be a high price for a pair of jeans compared to no-brand jeans.

Behavioural

Loyalty

Levi requires consumers that have brand loyalty due to Levi’s strong brand heritage and unique market.

Psychographic

Product interest Priority initiative

Levi requires customers that have particular interest in denim wear which leads to customers making priority initiative decisions on purchasing Levi’s products.

Value proposition In this technological controlled generation, with people raising health awareness that brings activewear as a fashion trend, the value proposition of Levi to the target consumer is production extension and working on diversification by collaborating with other brands. Levi will be available on most of the mix-brand retail clothing stores such as David Jones and Myers, which considers the demographic factors as Levi is targeting middle to high income families (SaiBil, 2020). It is also a large distribution network as David Jones and Myers are stores that appear to be in all Westfield shopping malls, hence making it easy and convenient for the consumers to reach (Brook, 2019). In relation to working on production extension and diversification, Levi can consider combining with other brands that are leading the trend to create excitement and to grow the brand’s popularity to the market. By collaborating with other brands, this leads to a sensational topic of the internet as this would bring two different groups of consumers together, therefore, promotes the brand of Levi by frequent publicity and attracts more consumers.

Positioning map Figure.2 shows the brand positioning map along with all the other activewear brands and denim brands as competitors. The map suggests that the analysis of Levi believes that Levi is actually 4

Levi Strauss & Co not in the current trend, however, compared to other brands, the price is more affordable and it has a unique market. Thus indicates why Levi should work on brand promoting by working with brands that’s on the current trend.

Positioning statement The brand Levi is a brand name apparel that designs denim clothing wear, casual outfits and other accessories, the company focuses on providing all consumers top quality denim with the promise of decades of heritage. The target audience for Levi would mostly focus on teenagers and young adults that have a middle to high income.

Market tactics Product As mentioned previously, Levi has a strong brand individuality as it obviously focuses on denim wear, and is very well-known for its blue jeans (Saibil,2020). However, because of the change in social media, Levi has less publicity compared to many other brands. Levi can possibly make a change in the products line with the choices of; - Sub-brand for activewear

5

Levi Strauss & Co -

Collaboration with other brands

Out of the two choices, the main focus would be to collaborate with other brands, due to Levi has a strong brand individuality, it would be unlikely that making a sub-brand that creates activewear would be the optimal choice, as the consumers considers Levi to have top quality for their denim wear as that what Levi is specialist in. On the other hand, collaboration between brands is very common and attracts more consumers as it combines the market of two brands, and it often creates the topic on social media as it's something “new”. By collaborating to other brands, Levi can expand its market publicity and also expands potential buyers.

Price The “5 C’s of pricing” (Table 2) displays the analysis of the 5 different factors of pricing. The pricing strategy that is considered the most suitable for Levi is the value-based pricing strategy. The value-based pricing strategy, the company aims to set the price of the product based on how much their potential customers believe the product is worth. If Levi successfully collaborated with other brands, that would automatically raise the price of the product as the consumers would believe the price should be higher since it involves two different brands. Hence, the value-based pricing strategy would work well with the product as customers believe that the product out of a collaboration is immediately worth more compared to non-collaborations. Therefore, any collaboration products can be sold for about 1.5 or double of the price to the average market price, for example: A pair of Levi blue jeans that cost $100 now can be sold as $150~$200. Table 2: 5 C’s of pricing Company Objectives

Extending the brand publicity by utilising other brands popularity on social media through collaboration, but also maintaining the unique market at the same time.

Customers

Families with children from the age of 15-25 with a middle to high income, the main target audience are teenagers and young adults, as well as brand loyalty to Levi.

Costs

The majority of the cost would be the wages for Levi’s staff members, other variable costs would include warehouses, machinery and promotion costs.

Competitions

The major competitors for Levi are active-wear brands, such as lululemon, nike or gymshark.

6

Levi Strauss & Co

Channel Members

Levi has a partner with a fabric factory with custom high quality denim fabric as well as other materials for all clothing wear. Levi produces each product in a separate factory and sends it to ware house then distribute to each major stores as well as other clothing stores such as Myer and David Jones.

Place Considering Levi has a smaller market compared to other clothing brands that have mix styles, there should be more focus with intense distribution methods. All Levi’s products would not only be distributed to its existing apparel shop in Australia, stores like Universal store and General Pants Co which Levi already has an existing relationship with, the other focus would be mix-brand luxury stores such as Myers or David Jones in all shopping malls. As Levi aims for middle to high income families Myers and David Jones would be a great option as they focus on luxury brands. Levi’s product would be positioned as an individual section in the clothing wear area, with all the denim wear, making Levi stand out in the crowd and significance it’s uniquity.

Promotion Table 3 indicates the details of the promotions and suggests budgets for each promotion that would lead Levi to achieve its marketing goal. Table 3: Promotion Breakdown Marketing Goal

Promotion

IMC tool

Budget (total $45 000)

Levi Strauss & Co. aims to earn total revenue $7 billion in the next financial year, increasing from $5.8 in 2019. As well as increase the brand's publicity on all social media.

Levi would work with the three current top fashion influence Bella Hadid, Gigi Hadid and Kendall Jenner. With the total 214 million followers on instagram from Bella, Gigi and Kendall, this should rapidly boost Levi’s sales as well as a massive publicity on

Social MediaInstagram partnership with fashion influencers

$30 000

7

Levi Strauss & Co

social media. Considering many families or young adults and teenagers go out to watch movies often, cinema ads would reach Levi’s target audience market.

Cinema Ads

$15 000

Reference Author, A. A. (Year). Title. Site Name. 1. Levi strauss Co, (2020). Who we are. Levi srauss. Retrieved from https://www.levistrauss.com/who-we-are/company/ 2. Jennifer Saibil, (2020). Why Is No One Talking About Levi’s Stock? Retrieved from https://www.fool.com/investing/2020/04/30/why-is-no-one-talking-about-levis-stock.asp x 3. Hitesh Bhasin, (2019). SWOT Analysis of Levi Strauss. Retrieved from https://www.marketing91.com/swot-analysis-of-levi-strauss/ 4. Liz Warren, (2020). Levi’s Latest Financial Strategy Involves a Personal Call from the C-Suite. Retrieved from https://sourcingjournal.com/denim/denim-business/levis-coronavirus-harmit-singh-liquidi ty-finances-revenue-210178/ 5. IBIS World, (2012). Trends Outfitting the Fashion Retail Sector. Retrieved from https://www.ibisworld.com/industry-insider/industry-insights/trends-outfitting-the-fashio n-retail-sector 6. Statista, (2020). Fashion. Retrieved from https://www.statista.com/outlook/244/107/fashion/australia 7. Money Smart, (2017). What do Australians really spend their money on? Retrieved from https://moneysmart.gov.au/australian-spending-habits 8. Fernfort University, (N.D.), Levi Strauss SWOT Analysis / Matrix. Retrieved from http://fernfortuniversity.com/term-papers/swot/1433/547-levi-strauss.php 9. Brent Robinson, (2014). How to use Levi’s core social strategies to capture Millennial love. Retrieved from https://www.bazaarvoice.com/blog/how-to-use-levis-core-social-strategies-to-capture-mil lennial-love/

8

Levi Strauss & Co 10. Autumn Wilberg, (2018). How Social Media and its Influencers are Driving Fashion. Retrieved from https://digitalmarketingmagazine.co.uk/social-media-marketing/how-social-media-and-its -influencers-are-driving-fashion/4871 11. Benedict Brook, (2019). Tactics shopping centres use to make us linger longer and spend more. Retrieved from https://www.news.com.au/finance/business/retail/tactics-shopping-centres-use-to-make-u s-linger-longer-and-spend-more/news-story/fe6c44a0de8f07d6782b8fd2268495a1 12. Chip Bergh, (2018). The CEO of Levi Strauss on Leading an Iconic Brand Back to Growth. Retrieved from https://hbr.org/2018/07/the-ceo-of-levi-strauss-on-leading-an-iconic-brand-back-to-growt h 13. Joanna Carter, (2020). Social media marketing trends 2020. Retrieved from https://www.smartinsights.com/social-media-marketing/social-media-strategy/social-med ia-marketing-trends-2020/

Appendices Appendix 1: SWOT analysis Strengths -

-

-

-

-

Levi’s focus is on denim clothing wear, making it a unique market (Bhasin,2019). Levi connects to young audiences as the clothing styles are stylish and gives audiences a strong brand concept (Fernfort university, n.d.). The signature blue jeans and other denim wear creates a strong brand portfolio (Bhasin,2019). Levi’s products are available in over 110 countries and it has over 60 production facilities globally thus promoting a strong global presence (Bhasin,2019). Poor social-media utilisation, not many partnerships or advertisement has been seen on all social media platforms (Bergh,2018).

Weaknesses -

-

Levi is depending on the majority of the wholesale customers which only concludes to 10 of them, and the wholesalers take more than 31% of Levi’s net revenue. Putting Levi in danger as if there’s a breakage of the relationship with the wholesalers (Bhasin,2019). As well as the fix manufacturers Levi has been working with, which produces about 97% of Levi’s products. With all factories located in more than 30 countries, this puts Levi in danger as there’s a big uncertainty of the quality and different political issues (Bhasin,2019).

9

Levi Strauss & Co

Opportunities -

-

Brand collaboration can be a good opportunity for Levi to promote the brand as well as increase it’s publicity on social media (Bergh,2018). Levi can potentially work on its online store and extends its product to other online platforms such as ASOS or ICONIC (Statista, 2020).

Threats -

-

The major threat for Levi would be other competitors, as the rise of activewear is taking over a part of the fashion trend. Due to the modern society desires to be healthy, hence attracts the community to purchase active wear for exercising purposes (Bhasin,2019). As technology updates, more and more e-commerce stores have entered the fashion field. E-commerce has easier access to open up a business, with a massive benefit of no need of brand image building or other costs for the company, thus becoming a potential threat to Levi (Bhasin,2019).

Appendix 2: CDSTEP Culture

-

Levi are one of the world's largest brand-name apparel companies and a global leader in jeanswear, with more than 10 decades heritage (Levi Strauss, 2020).

Demographic

-

Levi emphasises more on the age group of 13-24, although it has a product range for people above 30 (Fernfort university, n.d.). Levi’s social media, web properties, or traditional media you will see a consistent theme—young people wear Levi’s (Robinson, 2014).

-

Social

-

In 2009, Levi’s launched their first social media marketing campaign on Facebook and Twitter (Robinson, 2014).

Technological

-

With more than 3.5 billion social media users, social media has now

10

Levi Strauss & Co

become synonymous with digital marketing (Carter, 2020). Economic

-

-

In 2016, Australian households spent $666 billion on general living costs, with this $20.4 billion was spent on fashion Revenue in the Fashion segment amounts to US$6,058m in 2020.

11...