MMS RR #4 - Warby Parker - Grade: A- PDF

Preview

Summary

Sample Reading Response Paper...

Description

October 22, 2018 MMS Reaction Paper: Warby Parker 1. Is there any way you would consider Warby Parker as a "Purple Cow" or "10X better" than the competition? Briefly explain why or why not. As an actual Warby Parker customer and student on a budget myself, I will say that their appeal to a relatively young audience (determined by on-trend styles and a modern online presence) paired with consistently reasonable prices make this company stand out from others. Having been inside one of their retail locations, Warby Parker clearly places a large emphasis on customer comfort by having trained glasses experts greet you as you walk into the shop, help you through the process of selecting a new pair, giving you free water and snacks, free eye exams, and other commodities that you’d likely have to pay for at a Sunglasses Hut, for example. Since they have such a large following in their stores, the company has also introduced an innovative feature to improve their online traffic. You can order 5 pairs of glasses for free from their website, have them shipped to your home, select the pair(s) within 5 days that you’d like to keep, and ship the rest back at no cost! Obviously you do pay for the pair(s) you kept later, but the flexibility and ease this brings to a customer is certainly a “Purple Cow” trade marker as few, if any, glasses shops offer this unique aspect to the buying process. 2. The pricing of Warby’s product is obviously an attraction. How important do you think the quality and design of the actual product matters to their customers as opposed to the price? Why? This company preaches that they have everything the designer brands offer (glasses that are durable, fashionable, effective etc.) at a $95 price tag. In order for this young brand to succeed

in the larger glasses market, they must deliver on these promises and do something more – such as offer new, innovative ways to shop (i.e. free at-home try on– as discussed above) and offer a multitude of styles to appeal to a broad range of styles for individualistic youngsters. Both the price and design/durability of the product are equally important in my opinion. Customers would likely drop the brand quickly if the actual product were not as advertised (either in price or quality), especially due to the nature of a start-up. Warby Parker must gain customer loyalty before anything else and the best way to do this is to deliver on their marketing promises. Another component that allows Warby Parker to stand out effectively is publically establishing their brand aesthetic through advertisements, inclining a young audience to develop interest quickly. 3. Warby Parker chose a $95 price point for their designer eyewear. What are some reasons that they might have specifically chosen this number? What does it tell you about their strategy and methods of pricing? The $95 price point was incredibly strategic in my opinion because Warby Parker’s target audience is young adults who may have just began their first jobs, are paying rent for the first time, or still studying at university, and most probably don’t have extra funds to be spending on expensive $500 sunglasses. By placing themselves on a customer-price oriented scale, Warby Parker can effectively please their early target consumers, ensuring popularity amongst their friends later on. If Warby Parker were to price their glasses too high, they would be considered the same as expensive designer brands, but without the label or luxury of wearing a “name” brand. This would cut their profits easily. On the other hand, if Warby Parker decided to sell their products for too low, customers might be doubtful about the quality of the product and be hesitant to buy in the first place. Another important aspect I noticed is that $95 is not $99 and I think in this case that $4 difference can make a huge

impact in the buying decision of a young person, simply because it looks like a much bigger difference in the scheme of the market. Other brands might market themselves at $99 price tags and say they are giving a discount to the customer but Warby Parker goes one step beyond and really embraces the price difference with a relatively new and consistent price point for their eyewear lines. 4.Warby Parker built their initial channel strategy around the idea of saving costs by being online and not having physical stores. Although they have made changes, there is no evidence that they originally had planned any major offline expansion. They started building offline stores as an experiment, but now find most of their business coming from this relatively small number of stores. What does that tell you about their initial channel strategy? Do you think they chose it for the right reasons? It seemed as though online purchasing was consistently promising, but online commerce was proven ineffective, within the larger eyewear market specifically, since only 3% of glasses were bought online. Warby Parker chose the online channel for the wrong reasons as they didn’t think about the customer’s buying experience for their product in particular, eyeglasses. They probably chose the online channel because it was easy, cheap, and they wanted to follow in the models of other successful (though broader) online commerce companies, such as Amazon, which was blooming at the time. They did not take into account the customer’s perceived risk of buying glasses online: seeing them on your face differently than imagined, and dealing with the hassle of a return. After realizing the website outlet wasn’t working as hoped, the best thing they did was slowly open retail stores to appease the customer’s online shopping pain (not knowing what glasses will look like on your face etc.). Especially by starting out with a couple stores instead of entirely closing down their online shop and switching over, they gradually began using an “omnichannel” which has become increasingly popular among young brands to offer the best of both worlds to young customers.

5. When Warby Parker decided to expand beyond their online sales, they did not have to undertake the expense of building their own stores. They could easily have approached existing eyewear chains about carrying their now popular brands. What reasons might they have had for doing this? What problems did this choice create for them? Warby Parker is a brand that appeals to a very specific target customer - young people that value style and fashion but do not necessarily have the means to pay the designer price. If the brand were to sell their products in an indirect or multichannel facet, they would likely almost entirely lose their target customer because that customer would no longer have an incentive to value the Warby Parker brand; they would be surrounded by other (previously established and trusted) brands and that competition would hurt Warby Parker’s sales. Selling through other chains especially undermines the specific image that W.P. has already established, as it would be tainted by the chain store’s name/brand aesthetic etc. Although Warby Parker ended up with a stronger individualistic presence and could name their own prices using a direct channel, this method also has some disadvantages such as delays in actually accumulating tangible profit, channel cost (i.e. building the actual stores/cost associated), longer time to develop actual channel (not as immediate as selling through a third party distributor), as well as a lack of market coverage (they don’t have the chain’s name associated with their label so it’s difficult to gain traction for a startup like this one)....