FASHION INSTITUTE OF DESIGN & MERCHANDISING PROFESSIONAL

PORTFOLIO

Meghan Fuller

Meghan Fuller 795 SW 83rd Ave Portland, OR 97225 September 26, 2012 To Whom It May Concern: My name is Meghan Fuller, and I am a recent graduate of the Fashion Institute of Design and Merchandising. I have spent the last year completing the Professional Designation Merchandise Marketing program. I am actively interested in pursuing a career in the areas of buying, merchandising and allocation, customer relationship management, and brand management. I am now at a point in my career where I would like to contribute to the growth of business, but from a corporate level. Through my education and experience with FIDM I have developed a new set of hard skills, and expanded my network of contacts. FIDM and its many opportunities have taught me to be goal-oriented, self-directed, resourceful and energetic. I look forward to the opportunity to apply these attributes and excel in the demands of the retail industry. My previous successes in the festival and event management industry and my experience in retail provide me with the skill set necessary for positions in the Merchandise Marketing career paths. Having worked in the event industry for over five years I have become accustomed to working in a challenging, fast paced environment. I have learned that this environment requires extra efforts to see a project to completion, and that time management is key. As a result of those lessons, I have successfully been able to balance my work in the festival and event industry with school and other full time work. My participation, as a sales associate, specialist, vendor, manager, and student, have enabled me to appreciate the many aspects of a business, and in turn allows me the capability to more effectively understand and relate to the needs of each party. I would be grateful for an opportunity to bring my experience and dedication to the retail industry. Thank you for taking the time to review my Portfolio. If you have any further questions regarding my resume or portfolio, please feel free to contact me by phone or via e-mail. Sincerely,

Meghan Fuller Enc.

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MEGHAN FULLER 795 SW 83rd Ave • Portland, OR 97225 • (503) 381-2007 • meghanrosefuller@gmail.com

PROFILE Highly motivated professional with nine years of experience in the festival and event management industry, and four years of sales experience in the luxury retail industry. Strong planning and coordination skills paired with keen ability to solve problems in fast-paced environments. Excellent communication skills, effective follow-through, and proven commitment to providing positive customer and client service. EDUCATION Associate of Arts, Fashion Institute of Design and Merchandising, San Francisco, CA September 2012 Professional Designation program, Merchandise Marketing concentration, Cumulative GPA: 4.0 Bachelor of Science in Business Administration, University of Oregon, Eugene, OR September 2006 Sports Business and Marketing concentration, Charles H. Lundquist College of Business La Trobe University, Melbourne, Australia, July – December 2005 EXPERIENCE Ice Cream Booth General Manager, The Waterfront Blues Festival, Portland, OR Summers 2003 – Present • Manage two high volume ice cream booths over four day time period • Fundraise for the Oregon Food Bank, raising net donations of $90,000 over nine years • Hire and train 20 employees each year by teaching set up, operations, and break down duties • Secure Health and Food Handlers Permits at the Multnomah County Health Department • Establish and manage a budget of $30,000 • Order and obtain $15,000 worth of supplies by working with outside suppliers and distributors Sales Consultant, BCBG Maxazria Specialist, Saks Fifth Avenue, Portland, OR September 2006 – July 2010 • Meet individual monthly sales goal of $30,000 • Design visual displays and merchandise floor to increase sales for selected products • Monitor sales of products to identify top selling merchandise from poor performers • Submit monthly sales reports to vendor • Educate sales associates on product line through seasonal seminars to improve selling strategies • Build personal client book through appointment selling • Respond to customer complaints in an efficient manner and involved management as needed Wine Judging Assistant, The Oregon State Fair, Salem, OR June 2006 – September 2006 • Organized over 300 amateur and professional wine submissions for wine competition and tasting event • Collaborated with the OSF Sponsorship Coordinator to develop a sponsorship packet for the OSF Wine Department • Prepared competition results for press release and updated wine awards booklet • Met and established a strong working relationship with the Oregon Wine Board • Assisted wineries and caterers during wine awards celebration for move-in, event hours, and clean up Marketing Intern, The Portland Rose Festival Foundation, Portland, OR March 2005 – June 2005 • Coordinated and managed merchandise sales at all PRFF sanctioned events • Designed spreadsheet to accurately track sales and inventory of merchandise • Planned members-only VIP Cruise for 350 guests on the Portland Spirit • Designed invitations, ordered decorations and collaborated with the Portland Sprit staff on activities • Filled souvenir pin board orders with retailers in the Portland metropolitan area • Organized and delivered benefits package for membership and sponsors ACTIVITIES • Premier Marketing Group, Fashion Institue of Design and Merchandising, Member, January 2012 - Present • Chi Omega National Sorority, Psi Alpha Chapter, University of Oregon, Personnel Chair & Member, October 2002 - Present • Festival & Event Management Workshop and Certificate Program, University of Oregon, October 2002 – May 2006 SKILLS Proficiency in Microsoft Word, Excel, PowerPoint, Access and Adobe InDesign

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Executive Summary

The following portfolio highlights the key areas of study, with the learning outcomes and skills I have developed as a result of my education. Each subject matter was properly learned through classroom lectures and completion of projects. Presented are highlights, excerpts, and samples from key projects that facilitated my understanding of the following subject matters: �  Buying Strategies �  Branding Strategies

�  The Retail Environment & Merchandising Strategies �  Trend Forecasting My participation in Internship Opportunities enhanced my education, and contributed to the overall development of my own personal Best Practices. Projects in their entirety and in original or digital format are available upon request.

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Table Of Contents

1. Buying Strategies………………………………………………. •  Outcomes and Skills…………………………………………………………. •  Niketown Women’s Running Apparel Department Analysis •  and considerations:

•  Power Point Presentation………………………………………….. •  Market Trend Analysis & Considerations……………………. •  Sample Excel Spreadsheets……………………………………….. •  Sample Purchase Order……………………………………………..

2. Branding Strategies…………………………….................

•  Outcomes and Skills…………………………………………………………. •  Case Study: TOMS Brand Audit and Review………………………..

3. The Retail Environment & Merchandising Strategies………………………………………………………. •  Outcomes and Skills………………………………………………………… •  Case Study: The GAP……...........................................................

4. Trend Forecasting……………………………...................

•  Outcomes and Skills………………………………………………………… •  Trend Board……………………………………………………………………. •  Trend Board Layouts……………………………………………………….. •  Business Proposal & Target Market Research……………………..

5. Internship…………………………………………….............. 6. Best Practices……………………………………………………

6 7 7 10 12 14 15 16 16 19 20 20 23 24 24 25 28 30 32

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Buying Strategies

The fundamentals of retail math were learned through activities where mathematical applications were applied to retail situations. A complete seasonal merchandising plan incorporating a customer profile, assortment plan, financial plan, and a gross margin projection, were developed. Evaluation of sales, profitability performance, and management, were achieved through application of computer generated reports, where the buying experience was simulated. Profit maximization techniques, vendor negotiations, purchasing terms, discounts, and open to buy management were also learned.

KEY PROJECT

Niketown Women’s Running Apparel Department Analysis and Considerations

Featured:

§  Power Point Presentation

§  Market Trend Analysis and Considerations

§  Sample from Excel workbook: 6 Month Sales Plan, Assortment Plan, and Open to Buy Analysis

§  Sample Purchase Order

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•  Analyze demographic and psychographic data to develop a comprehensive customer analysis

•  Demonstrate strong research

skills through the analysis of current business and market trends by identifying threats and opportunities to the business

•  Develop analytical skills by

formulating a 6-month merchandise financial plan

•  Complete an assortment plan

based upon the financial plan and department analysis

•  Evaluate the impact of

planning decisions by completing a detailed operating statement for designated planning period

•  Calculate Open to Buy, Gross

Margin Return on Inventory, Cash Discounts, and complete a purchase order

•  Calculate closing book

inventory and determine overage/shortages

Outcomes & Skills

Power Point Presentation

NIKETOWN SAN FRANCISCO

Women’s Running Apparel Department Analysis Presented By Meghan Fuller

*IF YOU HAVE A BODY, YOU ARE AN ATHLETE – Bill Bowerman, co-founder of Nike

!  NIKE, Inc. is the world's leading innovator, marketer, and distributor of authentic athletic footwear, apparel, equipment and accessories.

“ ”

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NIKETOWN San Francisco 278 Post St San Francisco, CA 9410 Department: Women’s Running Apparel

NIKETOWN: the company's premiere retail space for showcasing innovative products and deepening Nike's connection to consumers.

Market Segment Analysis Women’s Running Apparel

The Trendsetter: Alexandria

Gender: Female Age: 30 to 40 Income (Individual): $50,000 to $65,000/ year Education: Bachelor’s degree or higher

The Young Mother: Kate

Gender: Female Age: 32 to 45 Income (Household): $150,000 to $200,000/ year Education: Bachelor’s degree

The Baby Boomer: Peggy

Gender: Female Age: 50 to 60 Income (Household): $100,000 to $150,000/ year Education: Bachelor’s degree

The Hardcore Athlete: Becky

Gender: Female Age: 28 to 38 Income (Individual): $45,000 to $55,000/ year Education: Bachelor’s degree or higher

WEAKNESSES •  Collaborations have not trended into the

area of “designer” collaborations •  Negative press concerning supply Chain

issues •  Moderate inventory turnover pace

OPPORTUNITIES •  Runway fashions are incorporating

athletic influences into their designs •  Fitness communities are growing, as

traditional means of exercise are evolving, changing the consumers mindset

THREATS •  Adidas Originals has teamed up with the

retailer Opening Ceremony for a capsule collection influenced by the London Olympics for Fall/Winter 2012

•  Competition growing as fast fashion retailers are broadening assortment mix with activewear

STRENGTHS •  Market power: ability to drive innovation

at every level - brand, product, retail, operations, events, and communication.

•  Consumer engagement •  Skilled at taking digital technology and

advancing it – NIKE+ platform

S.W.O.T. Analysis Brand, Store, & Department

Merchandise Mix Women’s Running Apparel

Jackets/Hoodies Tops Pants Shorts Tank Tops $55.00 - $95.00 $30.00 - $60.00 $55.00 - $75.00 $30.00 - $55.00 $30.00 - $55.00

Merchandise mix modifications include: !  Color: respond to trends through added color options, while

maintaining balance with neutrals in key product SKU’s !  Size: Increase in smaller sizes, with wardrobing and styling issue

considerations !  Allocation: Increase in Tank Top classification to balance out the

styles among the assortment mix

Six Month Sales Plan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

Planned increase of 6.5% for Fall 2012 as a result of current business trends and market trend analysis. !  ECONOMIC: Easier lending standards expanding consumer credit,

unemployment levels at their lowest in three years, and a positive consumer confidence index

!  SOCIAL: Launch of NikeFuel Band in response to growing interest of health and wellness among consumers

!  PROMOTIONAL: New contract with the NFL- season kickoff September 2012

The Private Label Collection is a clothing line that will support the

demands of everyday life by seamlessly blending the worlds of sport and fashion. By pairing performance and design, both style

and comfort will be emphasized. The primary objectives this program will achieve are:

!  To stimulate sales growth across the Women’s divisions !  Compliment and expand current assortment mix !  Engage loyal consumers, and cultivate new customers !  Participate with current trends and fashions !  Offer products at a competitive price

"  The line will launch Fall 2012. Receipts will arrive August 2012, with a second

delivery in October 2012.

Private Label Program Women’s Running Apparel

Private Label Program Sample Line Sheet

Description Style Cost RetailVest Tank PL-TT1 $6.30 $18.00

Description Style Cost RetailDraped Top PL-T3 $9.80 $28.00

Description Style Cost RetailFabric Top PL-T2 $9.80 $28.00

Description Style Cost RetailCouture Tee PL-T1 $9.10 $26.00

August/October Delivery

August/October DeliveryAugust/October Delivery October Delivery

Description Style Cost RetailJogger Pant PL-P1 $12.25 $18.00

August/October Delivery

Private Label Merchandise AssortmentNiketown, Powell St.

Fall 2012

Private Label Program Sample Color & Fabric Swatches

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Store Promotions Women’s Running Apparel

NIKETOWN invites NWM2012 runners to enjoy 20% off your purchase of all Women’s regular priced Jackets and Hoodies, and 15% off your purchase storewide. Offer valid in store and online October 11, 2012 to October 31, 2012.

!  The promotional coupon will be distributed through all race participants registration packets

!  Select merchandise will be on display and available for purchase at the Expotique October 11th - October 13th

!  45 Additional coupons will be awarded to @NikeSF twitter followers who participate in twitter feed “re-tweet and win” contest, scheduled for October 11th, 12th, and 13th

Promotion Objectives

!  Measure in-store traffic !  Promote specific

merchandise to improve sell through

!  Engage and reward loyal NIKETOWN SF customers who are not participating in the race

25.00%

Class % to Total Department: October

Jacket/Hoodies

Tops

Pants

Shorts

Tank Tops

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Niketown SF Women’s Running Apparel Department Analysis & Considerations By Meghan Fuller

1. Demographic Analysis: Population Niketown is located in San Francisco, CA and serves the San Francisco County population. In order to better serve the Niketown Women’s Running Apparel customer base and maximize profits, a complete and thorough understanding of the geographic region and its population needs to be completed. The information for the San Francisco County population demographics was compiled using information from the US Census Bureau, and is described in Table 1.1. Table 1.1

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2. Psychographic Analysis: Population

In order to complete an in depth understanding of the San Francisco County, California population, information

concerning how the population lives, how they spend their time and money, what activities they pursue, and their attitudes and opinions about the world they live in needs to be collected. These variables will further aid in the development of how to properly serve the Niketown Women’s Running Apparel customer.

Using SRDS.com the San Francisco County, CA population can be further analyzed and described as follows:

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=3&'3#-"63$F3))$F(830.$-*$="&-('(D"-3$(#$-@"#$-@3$E3:"(#(#6$

H!$=*D,0"-(*#$=).'@*6&"D@(')I& & &I+#4L4B#4;&*+&#A4&$L#B& G17& &Z*O4&#"&B#$+;&")#&*+&$&JL"[;& G.7& &>4%D&"+&9$=$\*+4B&#"&O44(&*+M"L94;& G-7& &'L4M4L&#"&])D&(L";)J#B&ML"9&B(4J*$%#D&B#"L4B& H67& &'L4M4L&B(4J*$%#D&B#"L4&]^J&"M&49(%"D44&O+"[%4;=4& HH7& &<%[$DB&%""O&M"L&]L$+;&+$94& .7& &F(13)-.03$+"-36*&.I$5DD"&30$J$K3L30&.$ & &U);=4#&$%%"[B&#"&])D&;4B*=+4L&J%"#A4B& .G7& &Z*O4&#"&O44(&)(&[*#A&#A4&%$#4B#&M$BA*"+B& 0-7& &8*LB#&$9"+=&ML*4+;B&#"&#LD&+4[&B#D%4B& 2,7& &8)+J#*"+&*B&9"B#&*9("L#$+#&M$J#"L&*+&J%"#A4B& & 07&F(13)-.03$+"-36*&.I$%**4$J$M3N3&"63$ & &!LD&#"&4$#&=")L94#&M"";&[A4+4R4L&("BB*]%4& 2-7& &_B)$%%D&"+%D&B+$JOB&"+&A4$%#AD&M"";& H:7& &X)#L*#*"+$%&R$%)4&9"B#&*9("L#$+#&*+&M"";&4$#4+&& HG7& &W$#&M"";B&#A4D&%*O4&L4=$L;%4BB&"M&J$%"L*4B& & 67&F(13)-.03$+"-36*&.I$!D*&-)$J$F3(),&3$ & &T"&#"&D"=$& 007& &T"&;"[+A*%%^JL"BB&J")+#LD&BO**+=& G,7& &T"&`"==*+=^L)++*+=& G.7& &Wa4LJ*B4&M*R4&"L&9"L4&#*94B&$&[44O& GG7& &T"&]*JDJ%*+=& H,7& &W+`"D&4+#4L#$*+*+=&(4"(%4&$#&A"94& HH7& &

The psychographic analysis indicated the San Francisco County population is a liberal group, interested in the arts

and culture. They like to “stand out in a crowd”, and be noticed. They shop from specialty stores and appreciate a high level of employee knowledge in those stores. The population is concerned with style and fashion, and prefers designer/brand labels. They budget for designer items, and as indicated by the income levels the population can support high-end retailers. This population is more likely to be the first among their friends and social groups to try new styles, essentially making them “trend setters”. They lead active lifestyles, and incorporate various sport and leisure activities into their routines. The combination of sport related activities and the fact that they are more likely to snack on healthy foods where nutritional value is essential, suggests they are a health conscious society.

According to Claritas.com the top 3 lifestyle groups among the San Francisco County, California population can be classified and described as: • Money and Brains: Age 45 – 64, homeowners, married with children. They possess a graduate degree, and are

employed at a management level. This group can be described as wealthy with sophisticated tastes, and they live in fashionable homes on small manicured lots.

• Young Digerati: Age 25 – 44, renters and owners, with a varied family mix. They possess a graduate degree, and are tech-savvy. This group is attracted to trendy neighborhoods with restaurants, bars, and coffee shops. This group is affluent and ethnically diverse.

• Bohemian Mix: Age 55 or younger, primarily renters. They are a progressive mix of young singles, couples, and families. They lead liberal lifestyles and are early adopters who are quick to check out the latest movies, nightclubs, laptops, or microbrews. This group is ethnically diverse, with college degrees.

3. Segment Analysis Customer segments shopping in the Women’s Running Apparel Department, based on the demographic and psychographic research of the San Francisco County, California population, can be identified and defined into four main segments. 1. The Hardcore Athlete: Becky Gender: Female Age: 28 to 38 Income (Individual): $45,000 to $55,000/ year Education: Bachelor’s degree or higher Lifestyle: The Hardcore Athlete eats, sleeps, and trains. Exercise and maintaining a healthy lifestyle are highly important. She participates in sports at a competitive level. She is often training for a marathon or triathlon. When she is not training, she still incorporates sport related activities into her lifestyle (commutes via bicycle, walks the dog, goes hiking). Her schedule as a nurse allows for flexible hours to accommodate her busy lifestyle. She looks for performance and durability in her apparel, and needs her clothing to be functional and versatile. She will invest in key pieces, and is budget conscious with respect to other purchases. 2. The Trendsetter: Alexandria Gender: Female Age: 30 to 40 Income (Individual): $50,000 to $65,000/ year Education: Bachelor’s degree or higher Lifestyle: The Trendsetter appreciates style, and wants to look fashionable even at her most casual. The Trendsetter prefers brand names, and likes the associations about identity made with regard to wearing such labels. She leads an active lifestyle, where she balances both work and social activities. She works in Public Relations. When she is not working and entertaining clients, she likes to spend the weekends with her girlfriends. Her workout routines include weekly yoga classes, or long runs in the Marina. She is more concerned with style and fit than overall performance. The Trendsetter is less-price sensitive, but is still conscious due to the economic climate. 3. The Young Mother: Kate Gender: Female Age: 32 to 45 Income (Household): $150,000 to $200,000/ year Education: Bachelor’s degree Lifestyle: The Young Mother is a stay at home mom. Her day is spent taking the kids to the park or on play dates, and completing other various household chores. Her weekend routine involves meeting girlfriends for coffee and walking, or going to pilates class. She shops at Whole Foods Market, and prefers organic products. She prefers designer clothes and her budget allows her to buy them. Price is not an issue. She looks for style and function, as she is often on the go. She takes fashion cues from magazines and the women in her social groups. She will update her wardrobe seasonally to incorporate new trends. Her family travels to Palm Springs for long weekend getaways, and takes at least one major vacation a year. 4. The Baby Boomer: Peggy Gender: Female Age: 50 to 60 Income (Household): $100,000 to $150,000/ year Education: Bachelor’s degree Lifestyle: The Baby Boomer is entering into retirement and is working less. She now has more time to participate in hobbies and pursue new activities. She is active in her community and is a member of the San Francisco Museum of Modern Art. She enjoys travel, and is in the process of planning travel excursions to South America and Europe. Her husband also leads and active lifestyle, where sports and leisure are equally important. Together they play golf and tennis, and in the winter they go cross-country skiing. Style, function, and durability are all important purchasing considerations. Versatility will become increasingly more important as she begins to travel. She will invest in core pieces, and add on new styles seasonally to update the basics. Price is not an issue, as long as it translates to quality.

4. Merchandise Mix Modifications Niketown is associated with delivering quality, high performing, specialty products; all attributes the San Francisco County population is looking for. The modifications in the merchandise mix primarily need to be in the areas of size, color, and price. The healthy lifestyle, high activity level, and race mixture of the demographic suggest and support the allocation of smaller sizes. The vibrant attitude and demand for style and trends are indicative of inclusion of a color assortment beyond the standard black and white. Also, the economic characteristics of the population show that they are less price sensitive and their budget allows for brand name clothing. Class 1: Jackets and Hoodies First, I would increase the class total by 5% to adjust to the seasonal demand for warmer, layering pieces common with the transition into Fall. Jackets and Hoodies in the $85.00 price range will be increased to 20%, reducing merchandise at the $55.00 price point to 10%. This change is made for two reasons: heavier, more expensive materials are used for the Fall merchandise, and the higher price point is still in our target customer’s budget. To maintain color trends throughout the department, an increase in the Red tones will be added, and the lighter colors (White) will be reduced. A change in the size mix is minor but will be necessary to adjust for the way the styles are worn for fall (layered). An increase in size Small, with a decrease in size Extra Small will still provide enough sizes for the petite/fit frame of our client, while also addressing the styling issues. Class 2: Tops Tops will still remain the highest percentage of merchandise in the department, but with a slight reduction of 5%. The decrease is necessary to improve other classes, and to continue to provide our client with the most complete wardrobe. No adjustment needs to be made concerning price. Allocation is appropriate, as the higher price point is associated with the long sleeve and mock zip performance shirts, all of which are suitable for Fall. Also, reduction in the tops in the $30.00 price range would be a poor decision as our customers like to layer and wear our clothes to the gym indoors where long sleeve styles are not comfortable. The San Francisco County population appreciates color and style; therefore maintaining the vibrant color assortment is essential. Orange will be a dominate color in the Tops classification, outnumbering the previous seasons Red tones, therefore to reflect the change the class color will be changed to Orange from Red. Also, a reduction in White tones will reflect the change in season. Class 3: Pants I will maintain the class percentage at 15%. The shift in this class will mainly be made in the price range. The full length and thermal pants, in the higher price range, represent the increase in merchandise at the $75.00 price point. The decrease in the $55.00 price range reflects the decrease in capri styles, not as popular for the Fall season. To account for better sell through, allocation to small sizes needs to be made, reducing the assortment in size Extra Large. Black has always been the highest selling color for Pants, so it will stay at 50%. Pants in the Yellow classification will be introduced to match the collections in the department and serve the style/trend conscious consumer in the area. Class 4: Shorts Shorts will only be decreased by 5%. Even though we are transitioning into Fall, this style still remains at the basis of every consumer’s workout wardrobe. An increase in the higher price range will be made because not only are shorts always in demand, but the sell through at a higher price point will improve profits, and we know from research our consumers budget will allow for this change. Size allocation is appropriate. All color pallets are represented and minor changes were made based on season, trends, and how merchandise could be paired through each classification. Class 5: Tank Tops Despite the movement towards more fall merchandise throughout the department, an increase in Tank Tops should be made because of consumer demand. Our customer leads an active lifestyle, and likes to layer their apparel. The sport performance tanks compliment the Jackets and Hoodies, and they are appropriate for the many activities our customer is participating in (yoga, pilates, running). To test to see if the department would benefit from an increase in this classification, 5% will be a safe addition. More specifically, the sport tanks in the $55.00 price range will be introduced. Adding a neutral color, and a burst of color with this seasons popular Orange tones will best serve the style needs of the target market in this classification.

Market Trend Analysis and Considerations

10

5. Market Trend Analysis: Nike Women’s Running Apparel Fall 2012

Factors Opportunities Threats Company Sales 1.5% Economic Trends 1.5% Political Factors 1.0% -0.5% Social Trends 0.5% Competition 2.0% -1.0% Promotional Plans 1.0% Fashion Trends 0.5%

Total 8.0% -1.5% Net Increase/Decrease 6.5%

Current Sales NIKE, Inc. is the worlds leading innovator in athletic footwear, apparel, equipment, and accessories. NIKE, Inc. revenue was up 10% to a record $20.9 billion for fiscal year 2011. A strong second quarter was a result of growth in every geography, except Japan, and in all key categories except Action Sports (NIKE, Inc. Second Quarter Income Statement Review). The combined NIKE, Inc. portfolio proves to be a powerful tool in generating growth. Moving forward in a volatile global economy, leveraging the strengths of the portfolio will be essential in the ability to manage risk. The positive trend in growth should continue as a result of future activities, but with many unknown variables in this challenging economy, I estimate growth, due to sales alone, to be at 1.5%.

Economic Trends The US Bureau of Labor Statistics reported a 0.9% decrease in the national jobless rate, from November 2011 to December 2011. The US unemployment rate currently stands at 8.5%, with California at 11.1%. Although California is above the national average, the unemployment rate has seen a 1.4% decrease from December 2010 to December 2011. The San Francisco jobless rate fell to 7.6%, which is below the national average, and is considerably less than the rest of the state. The National Retail Federation forecasts a retail industry sales growth of 3.4% in 2012. Growth is derived from consumer credit, employment, and consumer confidence factors. With easier lending standards expanding consumer credit, unemployment levels at their lowest in three years, and a positive consumer confidence index, I estimate a 1.0% opportunity for Fall 2012. From a global perspective, Women’s Wear Daily (WWD) reports that the European debt crisis will continue to weigh on the global markets for 2012, and if there is no resolution soon, Greece, Italy, and Spain will face a tough year for consumer spending, threating a shut down of Europe’s retail business (WWD, 12 for ‘12: The Year’s Hottest Topics, Jan. 9, 2012). However, in Quarter 2, NIKE, Inc. reported an increase in revenues in Western Europe of 2% on a currency-neutral basis, and Central and Eastern Europe revenues grew 19% on a currency-neutral basis. Positive sales results abroad during economic hardship indicate further opportunity for growth for the company. I estimate this to be a 0.5% opportunity. Political Factors With an election on the horizon, a heated political atmosphere in Washington D.C. translates into an uneasy environment. According to WWD, the 2012 presidential race will be particularly concerned with unemployment and health care, and other issues facing retailers and the industry (trade and sourcing legislation) will go unanswered (WWD, 12 for ‘12: The Year’s Hottest Topics, Jan. 9, 2012). The confidence in our leaders’ spirit in their ability to forge ahead is not enough; with no actual actionable efforts made in 2012 this leads me to estimate a 0.5% threat. According to WWD, January 18, 2012, California Governor Jerry Brown launched a campaign to secure voter approval to temporarily increase sales tax by half percent and raise personal income taxes on the wealthy. The increase in personal income taxes would take effect this tax year and last through 2017. WWD continues to report, that retailers are in favor of this proposal and a recent Public Policy Institute of California survey found that 60% of likely voters favor the governor’s twin tax increase proposal (WWD, California Governor Pushes for Tax Hike, Jan. 18, 2012). In addition, here in Silicon Valley, the expected “Facebook Effect” and the possibility of hundreds of millions of dollars of additional state revenues related to Facebook’s IPO’s, also provide an opportunity. Combined, the proposed taxes and the pending Facebook stock offerings lead me to estimate a 1.0% opportunity.

2011 2010 Percent Change Annual Revenue (mill) $20,886 $19,014 10% Quarter 2 Revenue (mill) $5,731 $4,842 18% *Fiscal Year-End: May

Social Trends WGSN (5 Key Consumer Spending Trends for 2011, Dec. 28, 2010) reports key trends in consumer spending with “commsumption” and Co-created Own Brands (COBs) as trend areas. In addition, American Express Spending and Savings Tracker reports that 76% of consumers will spend more on health/fitness this year, up 6% from 2011 (Americanexpress.com, Jan. 12, 2012). Consumers are consuming as communities, as a result of the rise in online shopping and social networking. Also, consumers have the desire for personalization and the opportunity to co-create with brands. NIKE is active in both areas, as they were innovators in personal customization with NIKE-ID, and continue to develop a connection with the consumer through levels beyond the product (online Facebook communities, NIKE+, NTC app). As more consumers begin to apply these trends, NIKE has an opportunity to capture this newly engaged market and push them through the company’s brands. There is an opportunity for customers to recognize NIKE as an innovator in this area, since they had an early presence in these trends, further emphasizing their authenticity and credibility. WGSN also found that consumers are demanding and using mobile health applications on smartphones. They predict that by 2015 around 500 million consumers will use health-related mobile applications. This indicates a growing concern for the inclusion of health and wellness, which will influence consumers to add exercise and lead an active lifestyle, which in turn will benefit the NIKE brand. In addition to their catalogue of health inspired app’s, NIKE unveiled the NikeFuel measurement wristband on January 19, 2012, with limited sales beginning February 22, 2012. MarketWatch reported that this wristband will change the way people view physical activities, and allow them to upload and connect to the internet, Facebook, and other online communities. Because NIKE has already been responsive to early consumer interest in mobile applications, this launch moves them into another level further developing the 24/7 relationship with the consumer. The growing interest of health among consumers will benefit the industry, and the launch of NikeFuel contributes to my estimated 0.5% opportunity. Competition The 2012 Summer Olympics will be held in London. This monumental event is an opportunity for top sports brands in the industry to showcase their connection to sport and according to WWD big brands like Nike, Adidas, and Puma, are confident their marketing spends will translate into healthy sales. The industry and direct competition will all be using this as an opportunity to market to consumers making it a competitive event and potential threat, however the overall tone of the games, what it represents, and the inspiring spotlight it places on the industry allow me to confidently estimate a 1.5% opportunity. Stylesight announced Adidas Originals has teamed up with the retailer Opening Ceremony for a capsule collection influenced by the London Olympics for Fall/Winter 2012. The growing trend in designer collaborations and the customers’ responsiveness to this strategy present a possible threat, as this collaboration has the potential to cross over into current market segments. This presents a 1.0% threat. Lululemon, located a few blocks from NIKEtown SF, is a close competitor. Recent scandal and controversy in their company among employees and products has sparked bad PR for the company, as reported by the Huffington Post in a November 9, 2011 article. This presents an opportunity to capture their customer. I estimate a 0.5% opportunity. Promotional Plans Reebok’s contract with the NFL is ending after 12 years, and NIKE is taking over the reigns to provide new technology in the design and performance of the NFL’s jerseys. The New York Times reported that “nearly half of the NFL’s income from licensed goods comes from apparel and headwear.” According to the NFL schedule, kickoff to the 2012 season is September 6, 2012. The added publicity and chance to showcase the performance and durability of NIKE goods presents a 0.5% opportunity. The 9th NIKE Women’s Marathon will take place October 14, 2012. NIKE registration information reported a sold out race for 2011 with approximately 22,500 participants. The growing popularity of the event, and demand for race entries has increased significantly over the years and presents an opportunity to connect directly with the bay area customer. Added promotional events and a series of contests will be introduced for the 2012 marathon. The most recent contest announced was through NIKE+, for registered teams to earn a guaranteed opportunity to purchase a race entry into the 2012 marathon, which will be effective January 15th, 2012. Overall, the Marathon creates a 0.5% opportunity. Fashion Trends One Spring/Summer 2012 runway trend Harpers Bazar identified was “Sports Authority” where designers such as Alexander Wang, Rag & Bone, and Narciso Rodriguez utilized athletic influences. According to Vogue, Marc Jacobs even incorporated the trend, by pairing sneakers with skirts, and casual sweatshirts with bottoms that featured lace, sequin, or other more elegant materials. The acceptance of athletic styles into the fashion industry introduces a sporty vibe into the consumer marketplace, making this an opportunity for a 0.5% increase.

6. Private Label

NIKE represents two of the most powerful forces in any market, innovation and sports. Our brands connect with

consumers on all levels in and around sports: physically, culturally and emotionally. Through innovation in technology,

and the Nike+ platform we are able to connect with the consumer on a 24/7 basis. In order to consistently innovate and

create momentum that will fuel long-term growth, we will look to our Apparel and Women’s businesses to supply

additional growth and drive our Sportswear business. The addition of a new Private Label line will enable NIKETOWN to

develop a strong point of differentiation and continue to build consumer loyalty at the retail level.

The Private Label line will launch with a test group in the San Francisco NIKETOWN, Women’s Running

Apparel department. Receipts will arrive in August 2012, with a follow up delivery in October 2012. The Private Label

line is in response to market trends and the continued mission to connect with the consumer and deliver products that meet

the everyday demands of their life. The primary objectives of this program are:

• To stimulate sales growth across the Women’s divisions

• Deliver new product categories to the current market segment

• Cultivate relationships with additional market segments

• Offer products at a competitive price

The Spring/Summer 2012 Runways inspired the introduction of Sport Couture into ready to wear collections, of

which continue to reign as the key trend direction for the season.1 This presentation of athletic inspired style represents the

evolving consumer mindset that includes health and wellness, functionality, and “green” living at top of mind. This trend

is not likely to dissipate as Stylesight reported on the concept of “Fashletes”, where the worlds of active and fashion

coincide to create a fashion mash-up of Chic Activewear. Additionally, the Premiere Vision tradeshow examined this

trend and reported it will be translated across all markets.

The Private Label line will feature three key items across classifications to aid in the consumers creation of the

“Fashletes” look. The assortment will include more fashion styles, with less emphasis on performance, as this line will

serve to bridge the gap between athletic wear and streetwear. Sport influences will primarily translate in the design

through the materials and colors, whereas the cut and style will be more fashion forward. The price point will be set below

the average retail price in each classification, filling the void the current assortment lacks, and allowing for participation

among consumers not currently shopping with us because of price. Fashion ready-to-wear clothing, in general, is not

widely available among the current assortment mixes. Although, some products can serve multipurpose needs, on average,

most of NIKETOWNS clothing is performance driven. By capitalizing on this trend, NIKE is presented with an ideal

opportunity to enter into the “fashion” world.

The current market segments the NIKETOWN San Francisco Women’s Running Apparel department serves,

spans across the age range of 28 to 60. The Private Label line will primarily appeal to the “Trendsetter” market segment,

as she appreciates style and fashion the greatest. Introduction of this line will likely strengthen the relationship with her, as

currently the assortment mix is underserving her needs. Furthermore, the Private Label line will offer the flexibility to

more specifically target other market segments. Upon examination of the industry, our business, and the psychographics

of the population, NIKETOWN is currently underserving the contemporary market segment.

!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

The Private Label line will be an opportunity to respond to the changes within each area, and continue to progress

as an industry leader. The contemporary market segment is the consumer between the age of 18 and 30. This market

segment is commonly referred to as Generation Y, or the Millennials. This market is increasingly important to engage,

because, much like the baby-boomers they will play a crucial role in driving demand and consumer spending over the

course of the next few decades. Therefore, creating and developing a product line that delivers the right, product, at the

right time, in the right amount, with the right fit, at the right price, with the right communication tactics, to this target

market is, and will be valuable for long-term growth.

The fashion conscious consumer had previously been underserved as the stores business primarily catered to the

sports enthusiast. Not delivering to this market segment presents a huge opportunity for NIKE, as consumer tastes are

increasingly gravitating toward contemporary fashions. Additionally, the 18 to 30 year old market accounts for

approximately 17% of the U.S. population, or about 50 million people. Introduction of the Private Label line will be the

first step in engaging this market, and evolving the NIKE brand into other areas of the fashion industry.

Ridding off of the momentum of the Summer Olympics, August 2012 is the perfect time to launch the Private

Label line. The heightened visibility of our brand will increase in-store traffic. Therefore, delivery of this product

classification will be essential in continuing to cater to consumers’ tastes, and will allow for the maximization of

consumer wallet share. The second delivery will hit stores in October, just in time for the NIKE Women’s Marathon, to be

held in San Francisco. This event will attract individuals from all over, and is the perfect time to again introduce the

Private Label line to the public.

11

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13

14

Purchase Order!!!!!!!!! Purchase OrderPO # 1________

"#$%&!'()&*!'+,-./0'!"1 2&34$%*!567 1%&89:#!;<<$=(3>&*!??????????????????@&A#*!0$)&3BC!DE33839!;AA(%&< ;44%&CC*????????????????????????????? 1/F!G$83#*!1/F!@&C#83(#8$3!HC#$%&I/%4&%!@(#&*!J(K!LMN!OPLO ???????????????????????????????????? ":8A!28(*!Q%$E34??????????????????????????"#(%#!":8A*!;E9EC#!MN!OPLO .&%)C*!ORLP!'&#!SP!-/J????????????T-/JU(3>&<<(#8$3!@(#&*!VE3&!LMN!OPLO

!"#$$ %&$'()*+),- .+/"& !,",( 0. . 1 2 02 3,+#"45-)+$ !,$+467 !,$+43,+ 8&+#)"467 8&+#)"43,+ MU $ MU %W 2&C#!.(3X GYZ..L ;0F[LP [ [ [ \ \ SO ]^SP_!!!!!!!!!!! OPL^]P_!!!!!! L[^PP_!!!!!!!!! WM]^PP_!!!!!!!!! LL^MP_!!!!!!!!! ]WTW 2&C#!.(3X GYZ..L ;0QF[LP ] ] ] S S O\ ]^SP_!!!!!!!!!!! LWL^OP_!!!!!! L[^PP_!!!!!!!!! \SO^PP_!!!!!!!!! LL^MP_!!!!!!!!! ]WTW 2&C#!.(3X GYZ..L ;0G[ ] ] ] S S O\ ]^SP_!!!!!!!!!!! LWL^OP_!!!!!! L[^PP_!!!!!!!!! \SO^PP_!!!!!!!!! LL^MP_!!!!!!!!! ]WTW 2&C#!.(3X GYZ..L ;0Q[ ] ] ] S S O\ ]^SP_!!!!!!!!!!! LWL^OP_!!!!!! L[^PP_!!!!!!!!! \SO^PP_!!!!!!!!! LL^MP_!!!!!!!!! ]WT

.5943:372 ;<= >??@A<B444444 ;CDEA@<<B44444O U$E#E%&!.&& GYZ.L ;0F[LP [ [ [ \ \ SO `^LP_!!!!!!!!!!! O`L^OP_!!!!!! O]^PP_!!!!!!!!! [SO^PP_!!!!!!!!! L]^`P_!!!!!!!!! ]WTO U$E#E%&!.&& GYZ.L ;0QF[LP [ [ [ \ \ SO `^LP_!!!!!!!!!!! O`L^OP_!!!!!! O]^PP_!!!!!!!!! [SO^PP_!!!!!!!!! L]^`P_!!!!!!!!! ]WTO U$E#E%&!.&& GYZ.L ;0G[ [ [ [ \ \ SO `^LP_!!!!!!!!!!! O`L^OP_!!!!!! O]^PP_!!!!!!!!! [SO^PP_!!!!!!!!! L]^`P_!!!!!!!!! ]WTO U$E#E%&!.&& GYZ.L ;0Q[ ] ] ] S S O\ `^LP_!!!!!!!!!!! OL[^\P_!!!!!! O]^PP_!!!!!!!!! ]O\^PP_!!!!!!!!! L]^`P_!!!!!!!!! ]WTO 1(a%8>!.$A GYZ.O Q'6[LP [ [ [ \ \ SO `^[P_!!!!!!!!!!! SLS^]P_!!!!!! O[^PP_!!!!!!!!! [`]^PP_!!!!!!!!! L[^OP_!!!!!!!!! ]WTO 1(a%8>!.$A GYZ.O QF[LP [ [ [ \ \ SO `^[P_!!!!!!!!!!! SLS^]P_!!!!!! O[^PP_!!!!!!!!! [`]^PP_!!!!!!!!! L[^OP_!!!!!!!!! ]WTO 1(a%8>!.$A GYZ.O Q'G,[ [ [ [ \ \ SO `^[P_!!!!!!!!!!! SLS^]P_!!!!!! O[^PP_!!!!!!!!! [`]^PP_!!!!!!!!! L[^OP_!!!!!!!!! ]WTO 1(a%8>!.$A GYZ.O Q/D[LP ] ] ] S S O\ `^[P_!!!!!!!!!!! OSW^OP_!!!!!! O[^PP_!!!!!!!!! ]MO^PP_!!!!!!!!! L[^OP_!!!!!!!!! ]WT

.5943:372 A=< ACA>D@<<B444 >C=D<@<<B44444 ]WTS V$99&%!G(3# GYZGL FY,O ] [ [ W W SO LO^OW_!!!!!!!!! S`O^PP_!!!!!! SW^PP_!!!!!!!!! LNLOP^PP_!!!!!! OO^MW_!!!!!!!!! ]WTS V$99&%!G(3# GYZGL J;VL ] [ [ W W SO LO^OW_!!!!!!!!! S`O^PP_!!!!!! SW^PP_!!!!!!!!! LNLOP^PP_!!!!!! OO^MW_!!!!!!!!! ]WT

.5943:372 >= ED=@<<B444444 ACA=<@<<B44444

Totals 98 102 102 53 53 816 X FCE<E@A<B444 X ;<C?GA@<<B444

Buyer's Signature: Meghan Fuller

Purchase Order!!!!!!!!! Purchase OrderPO # 2________

"#$%&!'()&*!'+,-./0'!"1 2&34$%*!567 1%&89:#!;<<$=(3>&*!??????????????????@&A#*!0$)&3BC!DE33839!;AA(%&< ;44%&CC*????????????????????????????? 1/F!G$83#*!1/F!@&C#83(#8$3!HC#$%&I/%4&%!@(#&*!J(K!LMN!OPLO ???????????????????????????????????? ":8A!28(*!Q%$E34??????????????????????????"#(%#!":8A*!/>#$a&%!`N!OPLO .&%)C*!ORLP!'&#!SP!-/J????????????T-/JU(3>&<<(#8$3!@(#&*!VE3&!LMN!OPLO

!"#$$ %&$'()*+),- .+/"& !,",( 0. . 1 2 02 3,+#"45-)+$ !,$+467 !,$+43,+ 8&+#)"467 8&+#)"43,+ MU $ MU %W 2&C#!.(3X GYZ..L ;0F[LP ] ] ] S S O\ ]^SP_!!!!!!!!!!! LWL^OP_!!!!!! L[^PP_!!!!!!!!! \SO^PP_!!!!!!!!! LL^MP_!!!!!!!!! ]WTW 2&C#!.(3X GYZ..L ;0QF[LP ] ] ] S S O\ ]^SP_!!!!!!!!!!! LWL^OP_!!!!!! L[^PP_!!!!!!!!! \SO^PP_!!!!!!!!! LL^MP_!!!!!!!!! ]WT

.5943:372 =D F<A@=<B444444 D>=@<<B444444444O U$E#E%&!.&& GYZ.L ;0F[LP LO LO LO ] ] \[ `^LP_!!!!!!!!!!! \S]^[P_!!!!!! O]^PP_!!!!!!!!! LNO\[^PP_!!!!!! L]^`P_!!!!!!!!! ]WTO U$E#E%&!.&& GYZ.L ;0QF[LP LO LO LO ] ] \[ `^LP_!!!!!!!!!!! \S]^[P_!!!!!! O]^PP_!!!!!!!!! LNO\[^PP_!!!!!! L]^`P_!!!!!!!!! ]WTO U$E#E%&!.&& GYZ.L ;0G[ LO LO LO ] ] \[ `^LP_!!!!!!!!!!! \S]^[P_!!!!!! O]^PP_!!!!!!!!! LNO\[^PP_!!!!!! L]^`P_!!!!!!!!! ]WTO U$E#E%&!.&& GYZ.L ;0Q[ LO LO LO ] ] \[ `^LP_!!!!!!!!!!! \S]^[P_!!!!!! O]^PP_!!!!!!!!! LNO\[^PP_!!!!!! L]^`P_!!!!!!!!! ]WTO 1(a%8>!.$A GYZ.O Q'6[LP LO LO LO ] ] \[ `^[P_!!!!!!!!!!! \MP^\P_!!!!!! O[^PP_!!!!!!!!! LNS\\^PP_!!!!!! L[^OP_!!!!!!!!! ]WTO 1(a%8>!.$A GYZ.O QF[LP LO LO LO ] ] \[ `^[P_!!!!!!!!!!! \MP^\P_!!!!!! O[^PP_!!!!!!!!! LNS\\^PP_!!!!!! L[^OP_!!!!!!!!! ]WTO 1(a%8>!.$A GYZ.O QD;"GLP LO LO LO ] ] \[ `^[P_!!!!!!!!!!! \MP^\P_!!!!!! O[^PP_!!!!!!!!! LNS\\^PP_!!!!!! L[^OP_!!!!!!!!! ]WTO 1(a%8>!.$A GYZ.O QJbY.LP LO LO LO ] ] \[ `^[P_!!!!!!!!!!! \MP^\P_!!!!!! O[^PP_!!!!!!!!! LNS\\^PP_!!!!!! L[^OP_!!!!!!!!! ]WTO @%(A&4!.$A GYZ.S D/6LP LO LO LO ] ] \[ `^[P_!!!!!!!!!!! \MP^\P_!!!!!! O[^PP_!!!!!!!!! LNS\\^PP_!!!!!! L[^OP_!!!!!!!!! ]WTO @%(A&4!.$A GYZ.S D;"GLP LO LO LO ] ] \[ `^[P_!!!!!!!!!!! \MP^\P_!!!!!! O[^PP_!!!!!!!!! LNS\\^PP_!!!!!! L[^OP_!!!!!!!!! ]WTO @%(A&4!.$A GYZ.S 'QD'LP LO LO LO ] ] \[ `^[P_!!!!!!!!!!! \MP^\P_!!!!!! O[^PP_!!!!!!!!! LNS\\^PP_!!!!!! L[^OP_!!!!!!!!! ]WTO @%(A&4!.$A GYZ.S FY,LP LO LO LO ] ] \[ `^[P_!!!!!!!!!!! \MP^\P_!!!!!! O[^PP_!!!!!!!!! LNS\\^PP_!!!!!! L[^OP_!!!!!!!!! ]WT

.5943:372 ?E> ?C?;<@=<B444 ;?CE==@<<B444 ]WTS V$99&%!G(3# GYZGL FY,O [ [ [ W \ SS LO^OW_!!!!!!!!! \P\^OW_!!!!!! SW^PP_!!!!!!!!! LNLWW^PP_!!!!!! OO^MW_!!!!!!!!! ]WTS V$99&%!G(3# GYZGL G-0L [ [ [ W \ SS LO^OW_!!!!!!!!! \P\^OW_!!!!!! SW^PP_!!!!!!!!! LNLWW^PP_!!!!!! OO^MW_!!!!!!!!! ]WT

.5943:372 >> D<D@?<B444444 ACF;<@<<B44444

Totals 172 172 172 88 86 1380 X >C>A;@F<B444 X ;DCG;D@<<B444

Buyer's Signature: Meghan Fuller

Sample Purchase Order

15

Brand Strategies

The importance of building brand equity within the marketing and business environment was emphasized through the education of brand management strategies, where critical thinking was applied. How to build brand equity and the importance of brand image to the success of a product or business venture was emphasized through understanding of image, concept, trends, and customer motivation. In-depth study of the development of a specific brand was completed with a brand audit. Areas of focus were: brand loyalty, associations, delivery, and perceived quality.

KEY PROJECT

TOMS Brand Audit and Review

Featured:

�  Sample portion of written case study

16

•  Evaluate the importance, value, and impact of a brand to the success of the individual product, management organization, and business venture

•  Analyze the research techniques used to measure and evaluate brand awareness, personality, and consumer purchase influence

•  Interpret the factors that

establish brand identity, personality, and positioning

•  Understand the communication and extension strategies that build brand equity, brand loyalty, and global brand leadership

•  Analyze the strategies used to build different brand types: the Corporate Brand, the Product Brand, and the Personal Brand

•  Research, design, and

develop a brand marketing strategy , with the creation or extension of a brand

Outcomes & Skills

2

1. Executive Summary

The goal of this paper is to provide a case study about TOMS Shoes, Inc. followed by a

complete brand audit. We begin by analyzing the business, with a comprehensive brand review.

Next, we look at TOMS market position, with an emphasis on consumer perceptions and

associations of the brand. Third, an in depth review of their market segment is paired with a look

at their marketing strategies. Following, we present an industry analysis identifying TOMS

competitors, and the advantages and disadvantages TOMS has with respect to the market. Lastly,

concluding our research is an in-depth brand audit with a look at the strengths, weaknesses and

opportunities associated with the brand.

The objectives of our research are as follows:

• Review the brand elements and their mission

• Define core brand associations and values

• Understand TOMS branding strategies

• Recognize the target market, and their connection to the brand

• Identify competitors, and TOMS market position

• Develop a brand audit with recommendations

TOMS Brand Audit and Review Case Study Highlights

17

9

3. Positioning: Analysis of Brand Strengths and Future Potential

3.1. Building Brand Equity

To survive in a competitive marketplace a company must build a strong brand. The power of

a brand lies within consumer’s perceptions about what they have learned, experienced, and heard

about the brand. Building brand equity requires linking branding strategies with the ways in

which the consumer experiences the product. TOMS builds brand equity with customers through

the development and management of each stage, as represented in the Customer Based Brand

Equity model:

25

6. Brand Audit

Through examining the brand and conducting field research (see Appendix 1, Chart 2: Field

Research Checklist for reference) a complete brand audit can be made. Our research has

proven to us that TOMS has developed a new business model that has the potential to change the

consumer marketplace. Their marketing strategies have aided in the establishment of strong

brand equity, and have also lead to the development of a substantial customer base and tribe of

supporters. Their brand personality has shined through and has not only made TOMS a unique

company many want to model, but also one to compete with.

Brand Equity

In order to accomplish the four steps of brand building (identity, meaning, responses, and

relationships) the six brand building blocks need to be established in order to reach brand equity.

TOMS has reached the pinnacle of the Customer Based Brand Equity Pyramid, and established

brand resonance through development of each stage.

Brand Building Blocks:

1. Brand Identity

Brand Identity has been established, as TOMS is a brand that is associated with various

situations or circumstances.

Block 1 Brand Salience: Both depth and breadth of brand awareness have been achieved. TOMS

has established themselves as a for profit company working to promote long-term goodwill.

Their shoes have become linked with the One for One mantra. They have recently expanded their

product line into eyewear. Because TOMS is a giving company and it is widely know that “with

every pair you purchase, TOMS will give a pair of shoes to a child in need,” they have increased

26

the ways in which the brand comes to mind or can be consumed, making it not only about

purchasing shoes, but also a way to donate or be charitable.

2. Brand Meaning

Brand meaning has been created through the combination of performance needs and imagery

associated with TOMS. TOMS associations have contributed to the strong, favorable, and unique

characteristics of the brand, which adds to the brand equity.

Block 2 Brand Imagery: TOMS has taken on a personality of its own, and provides many social

needs. The purchase of TOMS products is convenient in that it not only fulfills the need met by

the product, but also, allows the consumer to “do good”. The instant gratification from being able

to purchase something and give at the same time, is a competitive advantage for TOMS.

Block 3 Brand Performance: TOMS shoes are popular among urbanites, and are often used as a

shoe that is comfortable to walk in and convenient to throw on. They are reliable and durable, as

well as an efficient shoe that is priced reasonably for its use. The variety in product styles, colors,

and patterns add to its character.

3. Brand Responses

TOMS creates positive responses that favorably impact the consumers association to the

brand. From the logo, that resembles the Argentinian flag, where TOMS shoes were first

delivered to children, to the feeling you get when you put on a new pair of shoes, TOMS hits

emotions at every level.

Block 4 Brand Feelings: TOMS elicits emotional feelings among customers with response to

their brand. The purchase of TOMS brand immediately initiates feelings. The assortment of

marketing programs, and clubs that have stemmed from TOMS, also initiate different feelings.

27

The various branding tactics used by TOMS has helped them create the six important types of

brand building feelings: warmth, fun, excitement, security, social approval, and self-respect.

Block 5 Brand Judgments: TOMS hold a lot of brand credibility among consumers. They are a

market leader in that they are the original innovators of the One for One model. They are

trustworthy, and are sensitive to the interests of customers. Also, their ability to interact and

engage with their consumers adds to their brand likability. TOMS is not only considered by

socially conscious consumers, but is now a fashionable item, and is among the consideration set

of many trendsetters. The advantage TOMS has to offer, mainly through the One for One model,

adds to the brands superiority, and sets it above competition.

4. Brand Relationships

Brand relationships have been formed at a variety of levels, and the increasing effort among

consumers to perform active engagements with TOMS proves the resonance among consumers

has been met.

Block 6 Brand Resonance: Brand loyalty is represented not only through repeat purchases, but

how consumers seek out more information about TOMS. The blog, Facebook page, and twitter

accounts are all examples by which consumers seek more information about TOMS.

Additionally, those social networking sites are examples of the attitudinal attachment consumers

have towards the brand. The most popular posts are pictures featuring consumers wearing their

TOMS. The sense of community evoked through the power of sharing the experiences with

TOMS has lead to the development of campus movements, and other clubs, where customers

unite to help TOMS reach their goals of giving. Also, the “style your sole” parties are becoming

popular trends, and provide another way consumers can enjoy the brand together.

18

28

Brand Marketing Strategies

TOMS has effectively communicated with their consumers and successfully managed to

engage new ones. We identified this through their accomplishment of creating brand resonance.

Word of mouth marketing essentially launched the brand, and gave TOMS the leverage

necessary to grow. TOMS is responsive to their customers. Generation Y is a culturally liberal

group, who take initiative and instead of accepting things for the way they are, they take on the

attitude of “what am I going to do about it?”. TOMS recognized this fact, and developed

programs that capitalize on the socially involved nature of their core demographic. Young people

started the TOMS movement, and the One Day Without Shoes campaign was a result of

enthusiastic college students. This act, shows customer loyalty no rewards program could

compete with.

TOMS excels at incorporating their mission into their brand elements and activities. The logo

is based off the Argentinian flag, the place where Mycoskie first developed the idea for One for

One. At first sight of the logo, you are reminded of the needy children who benefit from your

TOMS purchase, causing the customer to be reminded of the One for One mantra. The impact is

key in helping create brand equity. Also, included in the packaging of TOMS products, is a

TOMS logo sticker, and TOMS logo flag. These little gestures allow consumers to further

promote the brand. This is appropriate because TOMS at first benefited from word of mouth

marketing, and this tactic can help carry on that tradition along with creating brand recognition.

The TOMS Classic slip on shoe, designed after the Alpargata, is available in a wide variety of

colors, patterns, and materials. The combination of glitter TOMS and natural burlap TOMS

appeals to the fashion forward consumer, and the eco-friendly customer. Adding a vegan style to

the selection was an appropriate use of an ingredient brand. The use of these natural materials

29

again ties back to the association with the shoes origin, Argentina, and creates impact through

reminding consumers of the Argentinian lifestyle. Additionally, the use of seasonal colors, and

materials adds to the creativity of the brand and contributes to the fun factor of the shoe. TOMS

ability to continually revamp their products through the use of colors and patterns keeps

consumers coming back.

The primary corporate branding strategies TOMS utilizes to meet their end goal are word of

mouth marketing, cause related marketing, corporate alignment, and social media. The biggest

tool used to deliver these strategies is the Internet. TOMS has chosen to use the Internet as their

primary channel, and it has enabled them to become the brand that they are today.

TOMS.com is an interactive website that extends far beyond a catalogue of merchandise for

order. The story behind the brand comes to life through videos, photographs, and facts about the

One for One program. The interactive connection from other social networking sites, engages

customers and develops the emotional connection that builds a strong brand. This form of

interaction would be difficult to recreate in a store, especially because TOMS customers are not

in a centralized location. Because TOMS has excelled in communicating its brand through the

Internet, it makes the brand come to life for consumers and makes TOMS Shoes a lifestyle,

instead of being just another product. In other words, the Internet is an appropriate channel that

creates a high level of impact, is easily accessible, and an appropriate means of communication.

TOMS also sells products through authorized retailers. TOMS chose the authorized retailers

because they share the passion of giving, and want to expose their customers to the brand. Also,

this channel helps reach consumers not directly in the target market, which helps add to the

accessibility of the brand.

30

Competition

TOMS main competition is other shoe companies, such as crocs, vans, and BOBS by

Skechers. Each of these competitors has their own retail outlets, websites, and some of their

products can be purchased through authorized retailers that also sell TOMS. In competing with

these brands, and others, TOMS needs to asses their Points of Parity and Points of Difference to

evaluate the strength of their brand. Because, TOMS does not have their own retail store, and

other competitors do, this could be a possible market opportunity for them to consider, especially

if they feel it will help them gain a competitive advantage.

The advantages and disadvantages of TOMS location channels are: A. Internet

Advantages:

• Portray brand image through videos, photos, and blog posts

• Engage and interact with customers

• Build “community”

• Extensive merchandise selection

Disadvantages:

• Consumers can only pay with credit card

• Consumers have to wait for their order to be shipped and delivered

31

B. Authorized Retailers

Advantages:

• Exposure to consumers not in target market

• Brand exposure/awareness

• Co-branding opportunities

• Instant gratification from purchase

• Cash transactions can be made

Disadvantages:

• Control issues: working with other retailers and their objectives

TOMS has done a good job at offsetting the disadvantages associated with the Internet by

leveraging the advantages of using authorized retailers. TOMS has the opportunity to expand

their location channels to include their own store. Although, there current locations appear to be

working for them, this could provide them with the opportunity to compete with competitors at a

higher level. Cost considerations should be taken into account when evaluating if this is a smart

move, because currently through their location channels, TOMS reaches their target market

affectively. In transitioning into a retail store format, TOMS could also consider Pop-Up stores.

19

The Retail Environment & Merchandising Strategies

Introduced to the challenges facing the retail environment. In-depth study of current business practices being utilized through field research and weekly review of current events. Explored the new formats of retailing (omni-channel), and examined the application of technology to solve business problems and gain a competitive advantage. Best practices in merchandising strategies were realized through understanding the importance of product, price, place, promotion, fit, and stock levels. The importance of customer service and identifying your target market were learned through identification of CRM strategies. Critical thinking was applied to case studies, where comprehension of practical strategies was developed.

KEY PROJECT

Case Study: The GAP

Featured:

�  Sample portion of written case study

20

•  Recognize the importance of identifying your target market and building customer relationships, as it defines strategic merchandising decisions

•  Develop actionable points

that support merchandise strategy improvement

•  Identify how to use available

technology and buying systems for effective assortment planning in order to maximize profits and sales volume

•  Understand the process of

product development, and the advantages and disadvantages associated with private label brands compared to national brands

•  Recognize how current

issues and trends are challenging and changing business practices. (social media, mobile commerce, economic trends, sustainability, etc.)

Outcomes & Skills

Case Study: The GAP Highlights

! "!

Case Study: The GAP

The GAP is a North American mall staple. Synonymous with denim, khakis, and the

basic white t-shirt, the iconic brand has experienced a decline in profits and sales in the North

American market. On October 13, 2011 GAP Inc. announced the plan to reduce the number of

GAP brand stores in North America to 700 by the end of 2013, a 21% decrease from the 889

stores in operation, as of July 2011.1 The GAP was founded in 1969 in San Francisco, California

with a single store. Today they operate 3,200 stores worldwide, and the GAP Inc. brand portfolio

extends to include the GAP, Banana Republic, Old Navy, Piperlime, and Athleta.2 The GAP’s

height of success came to fruition around 2000. Gap Inc.’s sales growth went from around $480

million, in 1983, to almost $14 billion in 2000, an amazing 2,400 percent increase. The first

decline since 1989 came in 2000, where comp store sales dropped 5%, and then a massive 13%

in 2001, with the Gap brand down 12%.3 Over expansion, saturation, and the effort to reach too

many customers hurt the brand, resulting in the need for store closures. However, the Gap has

found success in other countries, making up for lost ground in the United States. The question

now becomes what can the company do to get back on track? In order to re-gain market share in

North America the GAP needs to complete a brand audit and focus on building brand equity and

developing a merchandise assortment mix to position themselves for long term future success.

!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!1 Chang, Andrea. "Gap to Close about 200 Stores in N. America as It Expands Overseas." Los Angeles Times. Los Angeles Times, 14 Oct. 2011. Web. 18 Feb. 2012. <http://articles.latimes.com/2011/oct/14/business/la-fi-gap-downsize-20111014>. 2 "Key Facts." GapInc.com. Gap Inc. Web. 18 Feb. 2012. <http://www.gapinc.com/content/gapinc/html/aboutus/keyfacts.html>. 3 Lewis, Robin. "A Case For Euthanasia? The Gap on Life Support." The Robin Report. Web. 18 Feb. 2012. <http://therobinreport.com/a-case-for-euthanasia-the-gap-on-life-support/>.!

21

! "!

Brand Audit

To survive in a competitive marketplace a company must build a strong brand. The power of

a brand lies within consumer’s perceptions about what they have learned, experienced, and heard

about the brand. Building brand equity requires linking branding strategies with the ways in

which the consumer experiences the product. Before this process can begin, the GAP needs to

define their target market. Developing and implementing strategies will be more effective when

an intended audience is defined.

Who is the GAP customer? In my opinion the current target demographic is the consumer

between the ages of 25 and 35, the young professional, who is interested in trends and fashion,

but cannot afford a designer wardrobe. However, in a recent visit to the GAP located in San

Francisco’s Union Square, the customers in store appeared to be older (35-45 years old), tourists,

or shopping with family. The customer was not the fashion forward, younger Generation X, or

Generation Y consumer in search of the cool factor. The décor, visuals, window displays, and in-

store music indicated the GAP was trying to market and appeal to the younger audience, but the

intended demographic was not found among the flag ship store. This suggests a disconnect

between the GAP brand and consumer.

GAP needs to repair the disconnect with consumers by re-identifying who they are so

they can begin establishing relationships and developing a loyal customer base. The 25 to 35

year old market segment is an appropriate target market for the GAP. The other GAP Inc. brands

will help engage consumers outside this market segment, keeping consumers within the

company. The current retail industry suggests a shift towards fast fashion and consumer

demanded products. The GAP is the perfect brand, among the GAP Inc.’s portfolio to compete

with this marketplace trend, thus re-confirming their choice to target this market segment.

! #!

The lack of connection between the consumer and the brand lies within the inability of

the GAP to re-examine their own brand and its identity as they have transitioned from the denim

retailer to the multidimensional store. The GAP name is still suggestive of the basics and staples

they were once so popular for, which is why the intended target market is not connecting to the

brand. In order to rectify the situation the GAP needs to commit to this target market and

implement the four steps of brand building for a proper brand audit.

The GAP can build brand equity with customers through the development and

management of each stage in the Customer Based Brand Equity (CBBE) model. The four steps

of brand building, in the model, are:4

1. Identity: Who are you?

2. Meaning: What are you?

3. Response: What about you?

4. Relationships: What about you and me?

The CBBE model will provide the perfect platform for the GAP in making sure their strategies

align with the perceptions of their target market. Completion of this model cannot be done over

night. It will require time and implementation of various strategies at each stage. In order to

accomplish the four steps of brand building (identity, meaning, responses, and relationships) the

six brand building blocks need to be established in order to reach brand equity. Through

development of each stage the GAP can reach the pinnacle of the Customer Based Brand Equity

Pyramid, and establish brand resonance where brand loyalty is represented not only through

repeat purchases, but how consumers seek out more information about the GAP. Model 1.1

!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!4 Keller, Kevin Lane. Strategic Brand Management: Building, Measuring and Managing Brand Equity, 3rd. ed. Upper Saddle River, New Jersey: Pearson/Prentice Hall, 2008.

! $!

depicts the objectives each brand building block should establish to meet the requirements of

each stage.

Model 1.1

Brand Marketing Strategies

GAP has not effectively communicated with their consumers or successfully managed to

engage new ones. We identified this through their lack of creating brand resonance. GAP needs

to be responsive to their customers and the marketplace. In addition to the brand audit, some

strategies the GAP should consider implementing to ensure that all levels of the CBBE model are

met are in the areas of designer collaborations, multipurpose consumerism, and customer

relationship management systems.

4. Relationships: What about you and me?

1. Identity: Who are you?

2. Meaning: What are you?

Deep. Broad Brand Awareness

3. Response: What about you?

Strong, Favorable, and Unique Associations

Positive, Accessible Responses

Intense, Active Relationships

Salience: Category Identification

Performance:Product Reliability, Durability,

and Serviceability

Imagery:Personality and Values

Feelings:Fun,

Excitement, Security,

Social Approval,

Judgments:Credibility, Quality

Resonance:Loyalty,

CommunityEngagement, Attachment

! %!

Designer Collaborations

Fast Fashion and the economy have influenced an uprising trend in business, designer

collaborations. High-end designers like Missoni, Versace, and Karl Lagerfeld have all recently

participated in collaborations with stores, developing a moderately priced line of merchandise.

The New York Times recently published an article discussing the current designer collaborations

to hit the market, and their impact on the fashion industry. The article concluded that the

collaborations have become a reliable business model for retailers.5 Target launched a design

collaboration with Missoni in September 2011. The Missoni launch created a frenzy that caused

the retailer to sell out within a few days, and the surge in web traffic caused a crash of

Target.com.6 WWD recently quoted Karl Lagerfeld “This is not a problem whatsoever,” in

response to a question asking if his collaboration with Macy’s will dilute the image of his Chanel

and Fendi designs. Lagerfeld also went onto say “The more and more your name is around, it’s

even better for Chanel. I am linked to that. I think this is the right moment for this. It’s

pretentious to make only expensive things.” Those seeking items with luxury appeal and a tight

budget will appreciate Lagerfeld’s mindset. Also, even celebrities are finding this new business

venture appealing, and are vying for the merchandise with the mass market. Jessica Alba was

one of the many who took to twitter to express their desire for merchandise from the Missoni for

Target collaboration.7 The success of these collaborations and many others keeps us wondering,

who will be next to participate in this business trend?

!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!5 Wilson, Eric. "A Marriage of Economic Convenience." The New York Times. 16 Nov. 2011. Web. 28 Nov. 2011. <http://www.nytimes.com/2011/11/17/fashion/designer-retailer-union-remains-lucrative.html?scp=1&sq=a%20marriage%20of%20economic&st=cse>. 6 "As Profits Climb, Target Tweaks Apparel." Women's Wear Daily. 16 Nov. 2011. Web. 28 Nov. 2011. <http://www.wwd.com.subscriptions.fidm.com/retail-news/mass-off-price/as-growth-rolls-on-target-tweaks-apparel-5375263?page=2>. 7 Alba, Jessica. "Tweet." Twitter. 7 Sept. 2011. Web. 24 Oct. 2011. <http://twitter.com/#!/jessicaalba>.

22

! "!

Retailers in competition with the GAP and beyond have begun to adopt this strategy and

have discovered great success. The opportunity to collaborate with talent such as MISSONI, or

Lagerfeld does not come often, and the GAP should take advantage of this development to not

only help increase brand awareness, but rather leverage this opportunity to engage the consumer

they are seeking to target.

A good measurement to see if the current market will be responsive to use of this strategy

by the GAP brand will be the gauge in the success of the DVF for GAP Kids collaboration. The

line will launch in March 2012. The GAP Kids and baby GAP divisions are two of GAP brand’s

strongest performing divisions in North America.8 Although, the children’s retail industry is

different, use of this strategy among the well performing portion of the brand will still serve as a

good measurement for strategy implementation and hopefully demonstrate to the vertically

integrated retailer that in order for them to reach success among the GAP brand, strategy

differentiation is necessary.

Multipurpose Consumerism

A level of social corporate responsibility has been expected among businesses and

organizations and has become a necessity to gain consumers interest. Cause marketing has been

a brand strategy utilized to achieve social corporate responsibility and has given rise to the trend

in charitable fashion of which has created “multipurpose consumerism”. In a lagging economy

consumers are hesitant to spend or indulge on specialty items, and the efforts by corporations to

support the mindset of conscious consumerism has influenced products, websites, and events all

focused around the concept of multipurpose purchase; where a dollar spent not only provides the

consumer with something new, but doubles as charity. TOMS Shoes, Inc. may be the best

!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!8 Brady, Shirley. "Gap Taps Diane Von Furstenberg for Kids Collection." Brandchannel.com. 8 June 2011. Web. 19 Feb. 2012. <http://www.brandchannel.com/home/post/2011/06/08/Gap-Kids-DVF.aspx>.!

! #!

representation of this model. Their One for One mantra is the model by which they operate their

business on, where for every product sold one will be donated. The Huffington Post covered the

launch of a new product line for TOMS.9 The brand extension into eyewear from shoes by

TOMS, not only demonstrates the power of the charitable business model, but that consumers are

willing to support such products in markets where there are lots of brands to choose from. The

mindset has also expanded into the world of e-commerce. PR Newswire reported on the launch

of the website Community Collection.10 The website is the first e-commerce site of its kind,

combining designer fashion with the world’s top charitable causes, where with each item

purchased 20% of sales will be donated to the designers charity of choice. Department stores also

are responding to the consumers mindset. WWD covered Saks Fifth Avenues Key to the Cure

event.11 Additionally, Forbes reported on Neiman Marcus’ efforts to revamp cause marketing by

tying philanthropy in with the holiday catalogues “fantasy gifts”.12 These efforts are contributing

to the greater good of society and are a response to the consumers new mindset, where they want

to feel good about their purchases. Buyer’s remorse is a thing of the past, as “multipurpose

consumerism” eliminates the notion that consumers have to choose between buying something

versus doing something good.

In the past the GAP has demonstrated use of this model through their partnership with

(PRODUCT) Red. GAP (PRODUCT) Red launched in 2006 and was one of the first examples of !!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!9 Gillis, Carly. "TOMS Announces Eyewear As New 'One For One' Product." The Huffington Post. 7 June 2011. Web. 28 Nov. 2011. <http://www.huffingtonpost.com/2011/06/07/toms-eyewear-one-for-one_n_872847.html>. 10 "Fashion Meets Philanthropy With the Launch of E-Commerce Site, Community Collection." PR Newswire: Press Release Distribution, Targeting, Monitoring and Marketing. 18 Oct. 2011. Web. 24 Oct. 2011. <http://www.prnewswire.com/news-releases/fashion-meets-philanthropy-with-the-launch-of-e-commerce-site-community-collection-132042428.html>. 11 "Saks Kicks Off Key to the Cure." Women's Wear Daily. 21 Oct. 2011. Web. 24 Oct. 2011. <http://www.wwd.com.subscriptions.fidm.com/fashion-news/fashion-scoops/saks-kicks-off-key-to-the-cure-5323204>. 12 Dishman, Lydia. "The Priciest Items in Neiman Marcus' Posh Gift Catalog Play to Philanthropists." Forbes. 19 Oct. 2011. Web. 24 Oct. 2011. <http://www.forbes.com/sites/lydiadishman/2011/10/19/the-priciest-items-in-neiman-marcus-posh-gift-catalog-play-to-philanthropists/>.

! $!

cause marketing among retailers and products.13 They may have very well been an originator in

the concept of multipurpose consumerism, although because its introduction was in 2006 their

innovativeness may have gone un-noticed, as it isn’t until now that this trend is being demanded.

The GAP should consider re-examining this area of business. After all any element and addition

of corporate social responsibility should only translate to the overall enhancement of brand

equity.

Customer Relationship Management

The brand will only be successful if there are customers present. Once the target market

has been identified and strategies have been implemented to meet the needs of attracting those

consumers, a customer retention strategy needs to be executed. By introducing a Customer

Relationship Management (CRM) system, or set of strategies, programs, and systems that focus

on identifying and building loyalty with valued customers, resonance is surely to be generated.

The current GAP consumer primarily shops sale merchandise only. If the consumer begins to

associate value with the brand, as the previous strategies provide, they may change their

purchase behaviors and shop full price. The best way to ensure this is through delivery of

excellent customer service. A store environment where sales associates simply “clerk” will not

win the consumer over. People shop for more than just the products, but for the environment and

overall experience. When a CRM system is in place, a higher attention to customer service from

all store employees will enhance the systems performance, and more information will be placed

into the system allowing for future data analysis and identification of loyal customers. The GAP

should consider offering a combined approach to service, with personalized and standardized

services. Providing high quality service can be a challenge for many retailers, thus this approach

will offer a sustainable competitive advantage for the GAP. Furthermore, with an added !!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!13 "(RED) Faq's." (RED). The Persuaders, LLC. Web. 23 Feb. 2012. <http://www.joinred.com/FAQ>.

! %!

emphasis on service, management can talk to sales associates and more accurately identify the

top performing merchandise from the poor performing merchandise. The system will only

provide numbers, but interaction with consumers firsthand can provide insight as to what was

wrong, or great, about the merchandise. This information can be communicated to Buyers, and

Senior Management, who in turn can address the problems related to fit, style, or price, to ensure

it does not occur again, and new products delivered will more accurately match the needs of the

consumer, further building brand equity. Measurement of this strategy can be seen though an

increase in sales and higher profits for the company. For a more in depth measurement, the GAP

can also consider introducing Mystery Shoppers into their stores to further assess the quality of

service. However, to be fair this should be done after a clear set of personalized and standardized

service goals have been established between the retailer and its employees.

A CRM system is multifaceted. Successful completion of its objectives extend beyond

customer retention and work to improve the merchandise management process, where improved

merchandise equates to higher inventory turnover, of which results in more new products for the

consumer, which will also stimulate the excitement of sales associates. The CRM system should

first begin with a system that allows for customer data to be collected. This can easily be

achieved at point of sale through the POS terminal. After data is collected it can be analyzed to

determine a pattern among customers, where the proper target market can be identified. Third,

development and implementation of programs directed towards the target market should be

created. Programs to consider that support delivery of a higher level of customer service are,

frequent shopper programs, special customer services, personalization, and development of a

sense of community. When the CRM system and customer service strategies work together the

outcomes benefit the whole organization.

23

Trend Forecasting

Introduced to the concepts behind professional trend forecasting. The fundamentals of the trend research process were learned through the analysis of current events, social and cultural influences, and industry observation, where importance was placed on interpreting research into viable macro trends. Trend forecasting research and identification further developed with the application of the fashion forecasting process into target consumer groups, textile, and color trends in the global and domestic markets.

KEY PROJECT

Trend Development through Brand Extension: SM2 by Stella McCartney

Featured:

�  Trend board with layouts: brand and macro trend, color and textile story, with sample design flats for clothing line

�  Sample portion of written business proposal and target market research

24

•  Apply trend forecasting knowledge by identifying macro trends and their influences on future fashion forecasts

•  Compare and contrast street vs.

designer influence on fashion trends

•  Use research strategies to find

evidence that supports a macro trend

•  Identify and analyze global

trends •  Examine and explain past

trends in the context of historic, economic, and social developments

•  Explain the importance of a

current trend based on market research

•  Research and explain how

different markets interpret trends

•  Examine color and its value in the fashion and textiles marketplace

•  Recognize the relationship of fabrics and color in trends and market segmentation

Outcomes & Skills

Trend Development

25

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28

SM2

!

SM2 by Stella McCartney Brand and Store Development: Identifying the Target Market By Meghan Fuller

1. Background

1.1 Stella McCartney

British Fashion designer, Stella McCartney is best known for her sharp, simple, feminine and

wearable day brand. Her interest in fashion developed at the early age of 13, when she began designing

and making her own clothes. Three years later, she had an internship with Chrisian Lacroix.

McCartney completed her education at the prestigious London school, Central Saint Martin’s College

of Art and Design. She was appointed creative director of the Parisian fashion house Chloe in 1997. In

2001, she teamed up with the Gucci Group to develop her own label as a global luxury line. The same

year she debuted her collection at Paris Fashion Week, where her father Sir Paul McCartney sat in the

audience. In 2004 she established a long-term partnership with Adidas, and created the collection

Simply Adidas by Stella McCartney. Today the collection has evolved into a wide range of sportswear

including, winter sports, golf, tennis and yoga clothing. More recently, she designed clothes for

Madonna’s Revolution tour.

Stella McCartney operates 23 freestanding stores as of 2012. She is a vegetarian and tremendous

supporter of animal rights. She never utilizes fur or leather in any of her designs. In March 2012, she

introduced a Sportswear line that was designed specifically for the British Olympic team.

1.2 SM2

Environmental and ethical considerations are the guiding force behind all decisions, in both the

professional and personal world of Stella McCartney. Sustainable and ethical practices are highly

important, and influence the operations, design, and future of Stella McCartney. The creative vision

behind SM2 came about naturally, as Stella McCartney is always looking to improve its carbon

footprint. Green living, health and wellness, and sustainable practices are more prevalent in society.

The mindset is shifting towards new directions, where the individual is seeking truth, demanding

change, and not afraid to challenge reality. The concept of New Reality embraces an organic attitude.

SM2 is here to fashion the “New Reality” and support the beliefs that have always been true to Stella

McCartney.

2. Collection

The Stella McCartney design house will evolve beginning Fall/Winter 2013 with the launch of: SM2.

2.1 SM2

SM2 is an activewear collection for Men, Women, and Children. Inspired by the new reality,

SM2 will support the demands of everyday life by seamlessly blending the worlds of sport and luxury.

By pairing performance and sophistication, both elegance and comfort will be emphasized.

2.2 Objectives

The introduction of SM2 will provide important benefits for the Stella McCartney design house.

The SM2 label will work to achieve the following objectives:

• Create a brand that is innovative and easy to participate with.

• Engage loyal consumers, and cultivate new customers:

! Reach desired market segments, and grow relationship with the contemporary market

through proper branding and merchandising strategies.

! Stella McCartney Design House: opportunity to design Men’s Sportswear, allowing for

an easier future entrance into the Men’s market segment for the Stella McCartney

design house.

! Leverage relationship with Adidas to support line that merges sport and fashion.

• Compliment and expand current assortment mix:

! Increase activewear category by introducing more fashion items into the Men’s,

Women’s, and Children’s classifications.

• Participate with current trends and fashions.

3. Demographic Analysis: Population

SM2 will open a boutique located in San Francisco, CA and will serve the San Francisco County

population. In order to better serve the customer base and maximize profits, a complete and thorough

understanding of the geographic region and its population needs to be completed. The information for

the San Francisco County population demographics was compiled using information from the US

Census Bureau, and is described in Table 3.1.

Table 3.1

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4. Psychographic Analysis: Population

In order to complete an in depth understanding of the San Francisco County, California

population, information concerning how the population lives, how they spend their time and money,

what activities they pursue, and their attitudes and opinions about the world they live in needs to be

collected. These variables will further aid in the development of how to properly serve the SM2

customer.

Using SRDS.com the San Francisco County, CA population can be further analyzed and described as follows:

F(13)-.03$G(-03$=3&'3#-"63$7*&3$F(830.$-*$="&-('(D"-3$(#$-@"#$-@3$E3:"(#(#6$H!$=*D,0"-(*#$

=3&'3#-"63$F3))$F(830.$-*$="&-('(D"-3$(#$-@"#$-@3$E3:"(#(#6$

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`"==*+=^L)++*+=& G.7& &Wa4LJ*B4&M*R4&"L&9"L4&#*94B&$&[44O& GG7& &T"&]*JDJ%*+=& H,7& &W+`"D&4+#4L#$*+*+=&(4"(%4&$#&A"94& HH7& &

Preview Business Proposal and Target Market Research

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The psychographic analysis indicated the San Francisco County population is a liberal group,

interested in the arts and culture. They like to “stand out in a crowd”, and be noticed. They shop from

specialty stores and appreciate a high level of employee knowledge in those stores. The population is

concerned with style and fashion, and prefers designer/brand labels. They budget for designer items,

and as indicated by the income levels the population can support high-end retailers. This population is

more likely to be the first among their friends and social groups to try new styles, essentially making

them “trend setters”. They lead active lifestyles, and incorporate various sport and leisure activities

into their routines. The combination of sport related activities and the fact that they are more likely to

snack on healthy foods where nutritional value is essential, suggests they are a health conscious

society.

According to Claritas.com the top 3 lifestyle groups among the San Francisco County,

California population can be classified and described as:

• Money and Brains: Age 45 – 64, homeowners, married with children. They possess a graduate

degree, and are employed at a management level. This group can be described as wealthy with

sophisticated tastes, and they live in fashionable homes on small manicured lots.

• Young Digerati: Age 25 – 44, renters and owners, with a varied family mix. They possess a

graduate degree, and are tech-savvy. This group is attracted to trendy neighborhoods with

restaurants, bars, and coffee shops. This group is affluent and ethnically diverse.

• Bohemian Mix: Age 55 or younger, primarily renters. They are a progressive mix of young singles,

couples, and families. They lead liberal lifestyles and are early adopters who are quick to check out

the latest movies, nightclubs, laptops, or microbrews. This group is ethnically diverse, with college

degrees.

Combined, the demographic and psychographic collection of information support the decision to

launch the SM2 line with a boutique located in the San Francisco County. The information indicates

that the population’s mindset and economic status will adequately support the store and ideals at the

core of the brand.

5. Segment Analysis

5.2 Men’s

Customer segments shopping in the Men’s Department, based on the demographic and psychographic

research of the San Francisco County, California population, can be identified and defined into four

main segments.

1. The Hardcore Athlete: Tim

Gender: Male

Age: 28 to 38

Income (Individual): $45,000 to $55,000/ year

Education: Bachelor’s degree or higher

Lifestyle: The Hardcore Athlete eats, sleeps, and trains. Exercise and maintaining a healthy lifestyle

are highly important. He participates in sports at a competitive level. He is often training for a

marathon or triathlon. When he is not training, he still incorporates sport related activities into his

lifestyle (commutes via bicycle, walks the dog, goes hiking). His career in the service industry allows

for flexible hours to accommodate his busy lifestyle. He looks for performance and durability in his

apparel, and needs his clothing to be functional and versatile. He will invest in key pieces, and is

budget conscious with respect to other purchases.

2. The Pacesetter: Grant

Gender: Male

Age: 30 to 40

Income (Individual): $50,000 to $65,000/ year

Education: Bachelor’s degree or higher

Lifestyle: The Pacesetter appreciates style, and wants to look stylish even at his most casual. The

Pacesetter prefers brand names, and likes the associations about identity made with regard to wearing

such labels. He leads an active lifestyle, where he balances both work and social activities. He works in

Consulting. When he is not working and entertaining clients, he likes to spend the weekends out with

friends. He is in the “know”, always checking out the latest restaurants and events. His workout

routines include weekly rock-climbing classes, or long runs in the Marina. He is more concerned with

style and fit than overall performance. The Pacesetter is less-price sensitive, but is still conscious due

to the economic climate.

3. The Entrepreneur: Eric

Gender: Male

Age: 32 to 45

Income (Household): $150,000 to $200,000/ year

Education: Bachelor’s degree

Lifestyle: The Entrepreneur is a bay area transplant. He moved here after college to begin a start up

business in technology, and after experiencing success with his business he is moving into the second

phase of his life: family. Recently married, the Entrepreneur is still concerned with work, and is driven

by his success. He likes to unwind from the hectic workweek by spending his weekends trying new

restaurants, escaping to Sonoma, or taking his boat out on the bay. The Entrepreneur has a lot of

hobbies, and is always up on current trends. His wife also keeps his calendar full with social events and

activities. The two are starting to plan a family, as they both want children. His wife does most of the

shopping and heavily influences his wardrobe purchasing decisions. Quality and style are important.

He looks for styles that can go from work to the weekend.

4. The Baby Boomer: Steve

Gender: Male

Age: 50 to 60

Income (Household): $100,000 to $150,000/ year

Education: Bachelor’s degree

Lifestyle: The Baby Boomer is entering into retirement and is working less. He now has more time to

participate in hobbies and pursue new activities. He is active in his community and is a member of the

Lake Merced Golf Club. He enjoys travel, and is in the process of planning travel excursions to South

America and Europe. His wife also leads and active lifestyle, where sports and leisure are equally

important. Together they play golf and tennis, and in the winter they go cross-country skiing. Style,

function, and durability are all important purchasing considerations. Versatility will become

increasingly more important as he begins to travel. He will invest in core pieces, and add on new styles

seasonally to update the basics. Price is not an issue, as long as it translates to quality.

6. Market Trend Analysis

The growth of the Stella McCartney brand, SM2 core concept, and directional changes in the

business are a result of the shifts in the consumer mindset and industry demands. The idea of health,

wellness, fitness, and acceptance are all prevalent themes across multiple categories, and are greatly

valued by Stella McCartney. The mega trend “New Reality” is important on multiple levels. It

embodies the spirit and passion at the core of the brand, and is important for realizing future growth

strategies.

The core contributing factors that have influenced the current mindset and created the market

demands are as follows:

• A renewed sense of the importance of what’s real, what’s now and it’s potential.

! The consumer is considering different realities and exploring contemporary cultures,

lifestyles, science and technology to create new ideals and beliefs.

! The leaderless movement, commonly referred to as Occupy Wall Street, has identified a

trend in the consumer mindset suggesting that a change needs to be made, and that

everyone, each individual, holds the power to contribute to create progressive change. The

movement has reached a global level, and shows the power in which the current generation,

Generation Y, holds.

! We as a society have been faced with an overabundant amount of change recently, only

naturally resulting in the expression of emotions from people.

• New streams of products make health, fitness, and well being top of mind 24/7.

! Self-motivation and assessment are more easily reached with new tools available. The

ability to share and participate with friends, strangers, and people across the globe is a

possibility with the innovations in smartphone applications and exercise tools.

• Fitness communities are growing as more alternative options for exercise are emerging.

! Shifts within the market invite new and updated performance collections, “as designer

details, trend-driven color harmonies and aesthetic overhauls push the envelope in terms of

traditional design for active apparel, accessories and footwear.”

! Working out is no longer confined to the gym. Traditional means of exercise and

competition are experiencing a dynamic shift as the current mindset is evolving. The basic

ideals associated with “staying fit” and the concept of well-being has been re-designed.

• Brands are currently inspiring individuals to find their inner athlete and are working towards

fulfilling the idea that the consumer wants to not only feel good, but also to look good while

working out.

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Internship

Sales and Merchandising Coordinator Intern Elie Tahari, San Francisco, California April 2012 – June 2012

My work with Elie Tahari reemphasized the importance of merchandising strategies and the critical role they provide in supporting business objectives. Everything from the education about the product line through delivery of a seminar at an all store meeting, to the simple tasks such as making sure all merchandise is hanging on wood hangers (not plastic), are equally important and require the same amount of attention. It was rewarding to apply my classroom studies to my role as the merchandising coordinator intern. My internship also provided me with the opportunity to:

�  Merchandise deliveries according to Elie Tahari corporate standards in Union Square department stores: Saks Fifth Avenue, Bloomingdale’s, Macy’s, and Neiman Marcus

�  Communicate with Elie Tahari coordinator about merchandise re-orders and store recaps

�  Assist department managers, specialists and sales associates in promoting and selling merchandise to achieve sales plan

�  Provide sales support and interact with customers shopping in the Elie Tahari Shops within the Bay Area department stores

Elie Tahari Shop Bloomingdale’s San Francisco Centre 31

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Best Practices

“Best Practices” is often a method used by businesses, where the processes involved in conducting daily business activities evolve to support the business in achieving a sustainable competitive advantage. As a student, professional, and individual I too have developed a series of “Best Practices” that have helped me meet and achieve my goals. Through my studies as a Professional Designation student I have developed a set of habits that have not only been beneficial to my education, but have aided in my ability to comprehend and understand the dynamic nature of the retail industry.

As an Undergraduate in the Lundquist College of Business, at the University of Oregon, I learned the importance of scanning your environment, of which helps businesses identify their strengths, weaknesses, opportunities, and threats…which for me translated into reading local publications, logging onto business blogs, and participating in symposiums, seminars, and conferences. At FIDM, through a series of courses I studied Trend Forecasting, and was re-introduced to the concept of the “Zeitgeist”. Also known as “The Spirit of the Times”, understanding the role of the Trend Forecaster and how they define and interpret the Zeitgeist into trend development, reminded me of my best practices that formed during my undergrad education. These practices have evolved to adapt to my new environments and include not only understanding what is going on in the retail industry, but also familiarizing myself with the other aspects of society that indirectly influence and shape the direction of our future.

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My Best Practices consist of reading daily publications and blogs, participating in popular social media activities, and visiting retailers, businesses, and popular locations. Trend Forecasting taught me to create a source binder, of which holds pertinent information, that in theory should be used to discover macro-trends in fashion, but in reality it provides a proficient source of evidence for recognizing current trends, challenges, and offers an insight into the successful and failed best practices of industries, businesses, and individuals. Also, through FIDM I have been privileged to access phenomenal and significant resources. The library has provided me with:

•  Access to industry wide trade publications •  Fashion trend reports •  Exposure to original works from renowned designers, apart of

the schools vintage collection, and complete collections of Vogue and Harper’s Bazaar (dating back to the 1950’s)

The most notable has been my ability to access the trend forecasting services of Stylesight and WGSN. Even though they specialize in serving the professional industries of style, fashion, and design, their collection of information and resources spans across a variety of categories and can be applied to a variety of industries, and is particularly helpful in understanding the inner-workings of the consumer.

As I move forward into my professional career, I will continue applying my “Best Practices” to my work, and will hope that new discoveries and outcomes will result from my efforts at working to achieve my own competitive advantage.