Paez Case #1 - Grade: B+ PDF

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Mohadeseh Izadpoor, 215991722

Case1, ADMS3220

Professor Ian Gordon

1. Pando claims that "a weakness or strength of Paez is that it has too many values, while our competitors have just one core value." Is this a weakness or a strength for a brand? Why?

There are several reasons why I believe having too many values can be considered as a weakness for small brands like Paez. As noted by the founders, Paez does not have huge capital and human resources to do well in so many areas. This matter could have an impact on the brand image and the customer view about Paez. To illustrate, if the company is valuing too many things and doing poorly on most of them, the customer might assume that the firm is actually valuing none of them. In other words, it might send the wrong message that since everything is important, then nothing is important. Having one core value allows Paez to focus their limited resources to execute one core value. This also will help them to set achievable and affordable goals to perform such matters correspondingly. This issue lets them differentiate themselves from other strong competitors easier, like TOMS, if they get famous for one specific cause. Second, having one core value can often serve the company much better than too many proposals. In other words, values can expand the brand's understanding when they are communicated to the audience well. This issue allows them to go above and beyond the value to achieve the tasks related to it and better understand the customers who admire that value. This is a win-win situation because, in this case, the customer also will have a stronger bonding with the company vision. As a result, later, they can become loyal customers and be more beneficial. I could

Mohadeseh Izadpoor, 215991722

Case1, ADMS3220

Professor Ian Gordon

not identify the Paez core value and could not connect with the brand throughout the case, but I got enthusiastic to know more about the brand while reading about TOMAS's social mission-related campaign. This is to say that all these values are essential in ensuring that the customers feel they are part of the Paez. Overall, adding more value to the list makes most of getting undermined and will confuse the customers. Since Paez fails to communicate its values effectively to the customers, this will be considered a point of real weakness, and it's the main reason they could not assert their position to the customers.

Mohadeseh Izadpoor, 215991722

Case1, ADMS3220

Professor Ian Gordon

2. Which of the five brand positioning options should the company pursue? Why? By which criteria are you evaluating each positioning option?

I would choose Option 1, The Authentic Argentine Alpargata, because of some factors. Paez's

heritage, tradition, history, and

back-to-the-land

simple

craftsmanship are the only factors that make them unique and different from their biggest competitor TOMS, so they need to emphasize those matters more. In the modern world that we live right now, people and especially Millennials, want to contribute their money towards a social cause and have a story to tell about their purchased products. I believe this positioning is closer to Paez's mission since it can serve its customers profiled well. Base on the Paez's mission, their target is primarily included 18- to 35-year-old men and women who are socially minded and committed to eco-friendly values and interests. Peaz Alpargata can be the story of Argentine people and land. The story that customers could relate to and tell their friends. Emphasizing on this matter can help them to increase their popularity among those who value authenticity.

On the other hand, the founders are concerned about this strategy's cost, but I believe this concern will be solved as the demand and sale will increase after applying this strategy. Moreover, manufacturing the products in another country should not be a serious problem as far as the sourced materials and methods are regionals.

Mohadeseh Izadpoor, 215991722

Case1, ADMS3220

Professor Ian Gordon

The criteria that I would use for evaluating positioning option one are: 1.

For whom, for when, for where?

2.

What value?

3.

Why and how?

4.

Relative to whom

I would use the criteria to evaluate my chosen option by making sure that I will find the right group of people with the matched value, then I will reach out to them at the right time and find the answer for the rest of the criteria options.

Mohadeseh Izadpoor, 215991722

Case1, ADMS3220

Professor Ian Gordon

3. How else might the company differentiate itself from its competitors? What other value propositions hold promise for the company? Where is the white space in this category?

Based on my understanding and research, the TOMS lacks the use of ecommerce and social media campaigns. Ecommerce is an essential tool for any company these days, and this matter got highlighted more after the spread of covid19. The world after COVID is going to focus more on online selling, and since Paez's competitor hasn't spent time on this area, Paez can win the market by being the first and best implementer. After visiting their website, I believe if they keep the great work, they could defiantly turn this area into one of their strengths. Paez's emphasis on education was another matter I really loved about this company, and it stands out to me, which leads me to think that this can be another diffraction factor. I believed if Paez utilizes the use of cause-related marketing or does well by doing good, they can be more compete better in the market. For example, they can start a new campaign to support young Argentine artisans by manufacturing their art on Alpargata shoes. They can also help them with the turning on their company and later hire them as designers. These are some white space that the firm can improve itself on. As mentioned in the last question, the other value propositions that could hold promise for the company are the rich Argentina culture and history. More emphasis is needed on this matter.

Mohadeseh Izadpoor, 215991722

Case1, ADMS3220

Professor Ian Gordon

Mohadeseh Izadpoor, 215991722

Case1, ADMS3220

Professor Ian Gordon

4. How do company, consumer, and competitive factors influence your choice of positioning strategy? How does Toms' value proposition impact the company's strategic choices?

Company: Since the company's sourced materials and methods are based in Argentina, by applying this method, their current and/or forecasted resource allocation will not limit their ability to occupy, and it will help the company to adapt their strategy to their resources.

Consumer: This option will not cause a dramatic change in the market conditions, and the firm can keep its current positioning in most areas. For example, they still can be notified as a low price, high-quality brand and just reposition themselves with customers in terms of their value.

Competitive Factors: Based on this course's reading, competitive factors are positively related to the differentiation factors and how fast they can be adopted I accordingly t. If TOMS has discussed to reorients its strategy to occupy the same strategic position as Paez business, there will be a clear line to distinguish these two firms for customers. By that being said, I would like to note that applying the same strategy as Paez could be a real challenge for TOMS because Paez already wins the Argentine local market and

Mohadeseh Izadpoor, 215991722

Case1, ADMS3220

Professor Ian Gordon

partners. Also, Paez's heritage, tradition, history, and back-to-the-land simple craftsmanship are the factors that could not merely be reached by TOMS. Also, TOMS 'One for One' proposition will have not a significant impact on the Paez since Paez will only focus on the product's Argentinian origin.

Mohadeseh Izadpoor, 215991722

Case1, ADMS3220

Professor Ian Gordon

5. How does your positioning decision impact the company's product strategy? Should the company expand its line through product and brand extensions? If so, which type of extensions are most likely to produce significant sales growth and build brand equity?

In terms of brand expansion, I believe franchising, which was one of the areas that we wanted to allocate it the resources towards, is most likely to produce significant sales growth and build brand equity. Marry, one of the founders, said that we'd desire to consider franchising as one of the options and would like to become a multi-channel brand like Apple, but negotiating franchise terms with their current positioning strategy was super challenging because of the lack of a set of goals or core value. Applying the first option will allow the firm to develop core value and a list of setting up goals meaning franchising and becoming a multi-channel brand would no longer be unachievable. In addressing whether the company should or should not expand it's the line through product and brand expansion, I would like to quote from the case that "Paez's "twists" product extensions had broadened its product line and had become the voice of the brand, according to the founders." And my perspective as much as the firm needs to enter the value related market and produce more Latin American products, they still need to develop their strengths and build a strong foundation. For instance, they still need to have original fruit Alpargata strongly and, at the same time, think about any available design or innovative ideas double serve the firm the most. based on the

Mohadeseh Izadpoor, 215991722

Case1, ADMS3220

Professor Ian Gordon

positioning strategy, they need to ensure that Paez will communicate their Argentinianbased values through their products....