maketing report

7/25/2019 Maketing Report

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Marketing Proposal

LevisMade & Crafted

A.Table of Contents


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EXECUTIVE SUMM!".....................................................................................2

# $C%!'U().........................................................................................3

$# 'VE!VIE* '+ M)E & C!+TE) ST!TE"...................................................4

C# C'MPETITIVE (L"SIS.............................................................................5

)# T!ET CUST'ME! SEME(T...................................................................13

E# CUST'ME! $E,VI'!.............................................................................14

+# VLUE P!'P'SITI'(...............................................................................16

# M!%ETI( MIX.....................................................................................17

,# M!%ETI( CMPI(............................................................................20

I# EME!I( M!%ETS LI%E C,I(................................................................22

C'(CLUSI'(..............................................................................................25

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E-e./tive S/00ar1

Levis Strauss & Co. (Levis or Company) is a worldwide known brand of denim jeans. Levis

as the oriinal denim innovator had ained its brand awareness !ui"kly #$%'s. owever with

the emeren"e of new desiner brands and "heaper produ"ts from overseas that "aptured

market shares !ui"kly in #$$'s Levis was not able to "ope up with the "ompetition. *n a

misuided effort to "apture all market sements Levis produ"ed denim for every kind of

needs and "ompromised on pri"in thus dilutin its own imae as a denim iant and as a

result losin market share. +o reain its former market share and brand imae Levis "reated

its premium produ"ts , -ade & Crafted in order to reposition itself as the oriinal trendsetter

in the boomin premium jeans market se"tor.

*t is "ru"ial to build a brand imae for Levi's premium produ"ts be"ause "ustomers "an often

not tell the differen"e between the various brands but labels and their asso"iations definitely

influen"ed their evaluations.#+he stratey is to asso"iate the brand of Levi's with a sense of

style and fashion. +he marketin will aim at establishin this brand asso"iation. ih profile

advertisin on traditional media tareted promotions over the *nternet "elebrity

endorsements and stratei" in store promotions will be key in buildin the brand imae.

1 Consumer behavior a pra"ti"al uide /.0. 1o2all #$%3


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3. $a.kgro/nd

+he Company was founded in #%45 when Levis Strauss "ame to San 1ran"is"o California. 3

tailor named 6a"ob 7avis thouht of an idea to use "opper rivets to reinfor"e the points of

strain on pants. +he desin of the rivets in the 6eans differentiated Levi's jeans from other

"lothin be"ause of its in"reased durability. 7avis and Strauss patented the desin that later

in"orporated into the Company's jean desin and advertisements. +he Company "reated their

first pair of Levi's 4# 6eans in #%$s.

+he style be"ame the world's best sellin item of "lothin. Levi's jeans be"ame popular

amon a wide rane of youth. 8y #$99 Levi's be"ome the world's larest jean manufa"turer.

8ut durin the period from :4 to :#5 the lobal net sales was just over ; billion dollars

ea"h year shown as the below raph. +here were


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peak performan"e in the mid=#$$s.

3t the same time Levi's was fa"in "ompetition from other desiners and "heaper produ"ts

from overseas. 1rom #$$9 to :9 the Company reported loss for almost every year. *n order

to in"rease its net sales and reain its market share the Company "reated a super=premium5


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division "alled Levi's >> in :$. Levi's offers a premium denim line with better fabri"s and fit

"alled -ade & Crafted. -ade & Crafted sold in a "olle"tion se"tion of Levi's store or throuh

ups"ale retail outlets.

+he e2pensive jeans (with pri"e rane from


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3 brand that brins hih fashion to the life of the trendy and fashion savvy youn

eneration.

+he desiner jeans are sold without the obno2ious pri"e ta.

ih !uality produ"t uaranteed by Levis

3lso alon with laun"hin this brand Levi's should eliminate some of the other lower

end lines that are "ausin its brand dilution.

C#Co0petitive nal1sis

Customer's needs are shiftin sinifi"antly sin"e :'s. Levi's be"ame a leadin brand name

for jeans sin"e the beinnin of the #$A's be"ause it satisfied "ustomer's needs about

durability. Levi's taret "ustomers were "owboys +he desin of the rivets in the 6eans

differentiated Levi's jeans from other "lothin be"ause of its in"reased durability.

owever jeans had stopped bein merely work wear and be"ame a well=established fashion

statement in #$$'s. Levi's failed to "apture this trend. *t loss the "onne"t with youn

"ustomers (the #4=:4 ae roup). Bew desiners like /ap 7iesel ?ranler and @epe stole

market share Levi's market share shrank from 5# to #;. ;Sin"e : Levi's tried to

redesin its "lassi" produ"ts or laun"h some new produ"ts to attra"t the youn eneration.

8ut a""ordin to the resear"h D.S. teenae males "onsidered Levi's to be an un"ool brand.

4@rin"iples and @ra"ti"e of marketin A e by 7avid 6obber.7


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*n order to "reate stron and positive asso"iations with brand name Levi's should laun"h

more impressive premium brands. -ade & Crafted was laun"hed in :$ after the Company

e2perien"ed su""ess of another premium brand = 8lue jean that was issued in :4 in

Europe. +he oriinal denim manufa"turer Levi's should look beyond the bi brand name of

jeans and move towards premium and trendy desiner wear.

Levi's should build the followin points=of=differen"e that "ould not find the same e2tent with a

"ompetitive brand.

@rodu"ts desined by the top=of=the=line desiners +he top=of=the=line desiners

asso"iated with a produ"t impart a sense of hi=fashion to a produ"t. +he asso"iation

"an add value and "reditability to the produ"t.

E2"lusive use of the desin +he e2"lusivity offered by a parti"ular desiner "an add

value to the produ"t.

Celebrity endorsements 3"tors musi"ians and athletes who have been seen

wearin Levi's in publi" will attra"t the youn "ustomer be"ause the "elebrity has

sinifi"ant influen"e on youn people. Bow 7aniel 0ad"liffe 7enise 0i"hards Ellen

7e/eneres 6onah ill and et". are re"oniFed to be the "elebrities who wear Levi's

"lothin. 4

Consumers "an et a hih level of satisfa"tion from desiner jeans be"ause they are able to

asso"iate with the produ"t. +he "ustomers per"eive that Levi's -ade & Crafted is of hih

5Celebrities who wear levis Strauss & Co. 0anker httpGGwww.ranker."omGlistG"elebrities=who=wear=levi=strauss=and="o=Greferen"e

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values of fittin and hi=fashion besides the inherent !uality of the produ"t. +he followin study

shows the most sinifi"ant feature of the produ"ts.

3 Cs 'f Marketing

Customer

3e roup :4=54 +eenaers are e2"luded be"ause of the premium pri"e.

*n"ome roup medium=in"ome to hih=in"ome "lass

@eople who are willin to buy premium or desiner jeans

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Customers who are lookin for fashion wear may not be satisfied be"ause of the pri"e.

-ade & Crafted's pri"e rane from


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Competition

+he Company fa"ed "ompetition from desiner brands su"h as 3rmani jeans Calvin

Hlein and premium brands su"h as 7iesel +rue 0eliion. 8esides these Levi's also

needs to "ompete with /ap 7HBI.

Complementor

+he Company have well=known desiners to desin its premium produ"ts.

+he Company "an promote its produ"ts by havin more "elebrities wearin Levi's

-ade & Crafted produ"ts.

S*'T nal1sis4

Strengt5s4

E2istin brand awareness in denim industry Levi's was a hihly re"oniFed brand

by the "ustomers in the denim industry.

ih !uality produ"t strenthens reputation and allows premium pri"in Levi's is

"ertainly a very hih !uality denim maker. 3s a skilled denim manufa"turer have

ained well=known "redibility and reputation. +he premium pri"in would be

a"hieved.

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Established distribution "hannels Levi's has an effi"ient supply "hain. Levis has the

advantaes of an already established brand that has manaed to "arve out a ni"he

in the market by fo"usin on hih=end premium wear.

Sinifi"ant "elebrity endorsements positive effe"t on brand re"onition. Levi's will

be able to easily "apture the attention of the taret "ustomers.

Established the stron "ustomer relationship. +he "redibility earned by Levis due to

the stron "ustomer relationship will make it possible to promote Levi's premium

produ"t , -ade & Crafted.

*eakness4

7e"reasin market shares be"ause of fa"in hiher "ompetition @remium desiner

brands that "ompete with Levis in"lude +rue 0eliion 9 for all mankind Calvin Hlein

7iesel and 3rmani. +he other end of the s"ale is o""upied by reular brands su"h as

/3@ 3meri"an 3pparel J1 Crop et".

+he @remium pri"in for youth +he taret "ustomers are youth in the ae roup of :4

to 54 who are willin to a reasonable pri"e for a pair of desiner jeans. +he averae

premium desiner brands pri"e their produ"ts at


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efforts to shift the previous brand asso"iations to the new asso"iation with the fashion

and style.

T5reat4

Saturated denim market 7enim sales peaked around :9 with net sales

appro2imately DS< 4#.A 8illion. Bet sales in the ED the D.S. and China a""ount for

appro2imately 9 of the total lobal market. Dnsurprisinly denim net sales sin"e

then have been in "ontinual de"line.9

Dnenthusiasti" "ustomers *n a report by Cotton Inc Lifestyle Monitor the averae

pairs of 6eans (-en) owned in :A was %.; whi"h then redu"ed to A by :#: with a

similar redu"tion in women's ownership. 3lso the per"entae of -en and ?omen who

"laimed to love wearin denim dropped durin the same time period from 9A to

95.%

E"onomi" re"ession neatively affe"ted sales sin"e :%.

Customers are be"omin more so"ially and environmentally "ons"ious and a la"k of

"orporate so"ial responsibility in business pra"ti"es "ould lose "urrent and potential

"ustomers.

'pport/nit14

7-arket 0eport & *nforaphi" , 7nim 7e"lineK +rend illustrated 7esin and +rend. *llustratted.httpGGtrendillustrated."omGKp#:;$8-arket 0eport & *nforaphi" , 7nim 7e"lineK +rend illustrated 7esin and +rend. *llustratted.httpGGtrendillustrated."omGKp#:;$

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Emeren"e of new eoraphies Levi's row in the key emerin markets of 0ussia

*ndia China and 8raFil.$

/rowin market of premium denim +he lu2ury market rows very fast as well as

"ompetition. +he number of new produ"ts bein introdu"ed onto the market in"reased

by %9 in 6une :#; "ompared to 6une :#5. #

*n"reasin demand for produ"t innovation Consumers appetite has put the premium

denim market on the rebound sin"e :#5. 3s "onsumer resear"h roup B@7 reports

the fastest=rowin sement of denim market is premium (


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owever the taret "ustomers in premium denim industry are aware that a pair of


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Jiral trends set by peers +he "hoi"e of desiner jeans is to simulate word=of=mouth

"ommuni"ation amon friends and a"!uaintan"es. +he taret "ustomers tend to be

influen"ed by peer's "ommuni"ation throuh *nternet so"ial media and mobile

"omputin. Levi's should make efforts to establish the loyalty of "ustomers or promote

its -ade & Crafted produ"ts throuh store displays +J shows and fashion maaFines.

@ersonality to pursue fashion or style +ypi"ally a hiher deree of involvement and

"onsumers are lookin for jeans that "an satisfy their needs of somethin different

pleasure or desired.

@ur"hase habits +he premium denim "an be pur"hased in department stores and

major retail "hains. +he study showed that the sales at department stores and major

retail "hains are down. Customers tend to use online resour"es to resear"h in=store

pur"hase. +hey seem to be usin bri"k=and=mortar stores to try new styles but pullin

the pur"hase trier online. #5

13 7enim isn't dyin it's oin diital by 6ohn +omi"h 3pparel 7e"ember 5 :#; available athttpGGapparel.edl."omGnewsG7enim=*sn=t=7yin=*t=s=/oin=7iital$9;9

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+# Val/e Proposition

Levis has tried to introdu"e a new premium line known as Levi's >> to revive its brand sin"e

:9 when Levis has fa"ed loss for the last ten years. +his is mainly be"ause Levis "annot

shake its identifi"ation as the jeans for the older eneration. +he previous identifi"ation that

was a"!uired over the years by #$$'s is very stron.

?hen tryin to "ompete with the newer desiner brands in the premium denim market

Levi's tried to "apture all market sements by introdu"in innumerable lines of jeans and

thus lot its fo"us and market dominan"e as well.

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8y fo"usin on furnishin the needs of a spe"ifi" taret sement Levi's will be able to revive

its brand imae and establish a su""essful brand. -ade & Crafted as a new brand of top=of=

the=line desiner jeans with an affordable pri"e ta is the better solution.

Levi's needs to "hane its "urrent marketin stratey by laun"hin -ade & Crafted as a

separate brand and not just another line by Levis. -arketin it by asso"iatin with fashion

i"ons main streams ollywood personas and musi" i"ons will help "onne"t with the taret

"ustomers that look up to these "elebrities. *t would be sold only at Levi's showrooms and

hih end stores further enhan"in its e2"lusive appeal.

8uyin a pair of jeans "an often be an emotional de"ision. 3s su"h the value benefit the

"ustomer ains from owin a pair of -ade & Crafted jeans will not only be based on the

!uality of the jeans itself but on the emotional "onne"tion it has with the "ustomer. +he

pleasure of ownin a pair of e2"lusive premium desiner jeans at a less than obno2ious

pri"e "reates enormous value for the "ustomer and therefore would be "onsidered a reat

deal.

#Marketing Mi-

Prod/.t

3 survey "ondu"ted by Cotton *n". revealed that 4$ of those who bouht premium jeans

bouht it be"ause of the fit. 1it remains the sinle most important reason why "onsumers

pay over


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-ade & Crafted is a new brand of jeans that are desined in "ollaboration with an desiner

with a uni!ue and "reative ede. +he produ"t will be positioned mu"h more than hi=!uality.

+he fit and style will be the uni!ue sellin proposition of this brand.

-ade & Crafted is to be positioned as a distin"t brand as opposed to another series by

Levis. +he premium line has e2"lusive styles with varyin tints washes and uni!ue fits. +he

jeans are "reatively desined to "reate the illusion of lenth and flatter individual shapes.

+he premium line should have its own distin"t loo and label.

Pri.e

Levi's premium produ"t -ade & Crafted has a pri"e rane from


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Leverain Levis' "apabilities as an established denim manufa"turer

will help keep "osts

lower and therefore make profits by offer a relatively lower pri"e.

Pla.e

Currently Levi's -ade and Crafted are sold in the Levi's store in a separate se"tion and

some department stores. *n order to preserve itse2"lusivity the produ"t should be not sold

at low=end retail stores like Sears and 6C penny. +hey should be sold in hih=end retail

stores like 8arneys Saks and 8loomindales and online at the brand website.

* would re"ommend this premium brand of jeans should be sold at e2"lusive Levi's stores

and hih=end bouti!ues alon with other hih=end Levi's brands. +he e2"lusivity of the brand

"ontributes sinifi"antly towards the appeal of the produ"t as the premium produ"ts. +his will

help "onsumers to per"eive -ade & Crafted as a differentiated produ"t.

Mpenin up more e2"lusive Levis Stores will play an important role in in"reasin the

penetration rate. *n order to attain a hiher taret penetration rate it is important to "hoose

the lo"ation of the stores stratei"ally. Stores should be ideally lo"ated in lare shoppin

malls and "lose to bouti!ues of other desiner denim wear. +his pro2imity will allow -ade &

Crafted to present itself as a perfe"t alternative to the pri"ier bouti!ue jeans and will enable

effe"tive ainin of market share in the premium jeans sement.

Pro0otion

Levi's will take advantae of all the various forms of media to introdu"e itself to the world.

+he stratei" plan would be taretin the individual's style and preferen"e. 3ll advertisin

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and promotional "ampains will ensure brand re"onition in the initial staes and reinfor"e

brand awareness later on.

Levi's have enaed in some a"tivities to improve its brand imae reardin the "orporate

so"ial responsibility. Levi's introdu"ed its new denim line that in"orporates : post=

"onsumer re"y"led "ontent. +he new "on"ept of jeans will help to retain the "urrent

"ustomers and attra"t new "ustomers who are be"omin more so"ially and environmentally

"ons"ious.

,#Marketing Ca0paign

$rand 0bassador

-ade & Crafted "an hire a youn "elebrity that the taret market as a 8rand 3mbassador.

+he "hoi"e of the youn "elebrity should represent Levi's soul , like "reative or enereti".

dvertising

3 series of press releases about the produ"t will be sent to all major newspapers. 3n

e2tensive advertisin "ampain should be laun"hed. +his will in"lude "olorful print ads in

major entertainment and fashion maaFines su"h as /N Cosmopolitan and Joue. 7urin

the same period +J "ommer"ials will run durin prime time shows on all major "hannels.

Jideo Bews 0eleases will be sent to entertainment shows and "hannels.

Internet $/66

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Casual promotion throuh so"ial media sites su"h as 1a"ebook and +witter will "reate a buFF

on the *nternet about the new produ"t laun"hed by Levis. 3n email "ampain will be released

whi"h will "ontain small intera"tive videos of the produ"t to in"rease familiarity and enerate

more interest. +he "ontent of these so"ial media promotions would be spe"ifi"ally tareted at

the individual's style and fashion preferen"es. Jiral marketin and buFF "reated throuh word

of mouth will help the buildup. +he brand ambassador and other "elebrities will help spread

the produ"ts on the *nternet.

In Store Selling

3n elite sales for"e will be oraniFed for promotions in all Levis stores. +he sales for"e will be

trained to proje"t the brand's imae by way of their "lothin personality and intera"tion with

potential "ustomers. +hey will be the fa"e of the brand inside the stores. Customers will be

en"ouraed to try on the new brand of jeans. @romotional in"entives will be offered in store or

online.

I# E0erging Markets like C5ina

Levi's "reated and laun"hed a more affordable brand 7eniFen to rea"h teens and youn

adults in China. +he premium produ"ts have not laun"hed into Chinese market.

3""ordin to the resear"h 5$ Chinese "onsumers love or enjoy wearin denim. +he

per"entae is not hih but "onsiderin the #.; billion total populations in China the total

number of "onsumers who love or enjoy wearin denim is still larer than those in other

"ountries.

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3lthouh the post=:% re"ession neatively affe"ted the sales of lu2ury brands Chinese

market for lu2ury brand is still e2pandin. Study shows that almost half of the world's lu2ury

spendin will "ome from Chinese wallets by :#4. #;+here are some opportunities for Levi's

premium jeans enterin into Chinese market. 8ut at the same time risks "annot be

overlooked.

Mpportunities

+he Chinese re"ently started makin enouh money to splure. +hey "an afford the

premium pri"e of -ade & Crafted.

Chinese youn people pursue fashion and style in western "ountries

14China's addi"tion to lu2ury oods 3pr. :$ :#; by S.B. +he E"onomist available athttpGGwww.e"onomist."omGblosGe"onomist=e2plainsG:#;G;Ge"onomist=e2plains=#9

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Levi's has established a well=known brand name in China

+he Company "an e2pe"t lare volume sold in Chinese market

0isks

ih import tariffs and "onsumption ta2es

+he desin may be infrined

+he Company may need to adjust the siFe and desin for 3sian features

Labor work environment in Chinese manufa"turers is "riti"iFed in western "ountries

*n order to be su""essful in Chinese market Levi's -ade & Crafted should "onsider the

followin steps to laun"h the premium produ"ts.

+o ensure "onsisten"y between Levi's brand imae and pra"ti"es

+o establish brand asso"iation with fittin fashion and western life=style

+o avoid the leal or politi"al risks by "onsultin lo"al professionals

+o avoid ethi"al issues by "omplian"e with the D.S. employment laws

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Con.l/sion

?ith the "urrent market fas"ination for desiner wear -ade & Crafted is the perfe"t produ"t

for Levis to reinfor"e its "ore positionin , the oriinal denim trendsetter. +he stratey is to

send out a "lear and tareted messae that -ade & Crafted is the ultimate style statement in

premium jeans within an affordable pri"e rane.

+he premium produ"t "an be positioned as the perfe"t pair of premium jeans without the hih

pri"e taO a brand that brins hih fashion to the life of the trendy and fashion savvy youn

enerationO ih fittin and hih !uality produ"t uaranteed by Levis.

3lso alon with laun"hin this brand Levi's should "ondu"t marketin "ampains and find a

riht brand ambassador to represent -ade & Crafted.

*n order to laun"h the produ"t in Chinese market the Company should ensure "onsisten"y

between Levi's brand imae and pra"ti"es establish brand asso"iation with fittin fashion

and western life=style avoid the leal or politi"al risks by "onsultin lo"al professionals and

avoid ethi"al issues by "omplian"e with the D.S. employment laws.

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