thread. Abbie Nicholson N0581024
I confirm that this work has gained ethical approval and that I have faithfully observed the terms of the approval in the conduct of this project. Signed (student) ……………………………………………………..................
Abbie Nicholson N0581024 7,027 words
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4.introduction, 5.stage one insights, 6.aim & objectives, 7.methodolody, 8.further research
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9.market overview, 12.the slow fashion movement, 14.buying less but better, 15.millennial consumer, 16.the minimalist millennial, 17.PESTLE analysis, 17.opportunities
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18.the concept, 19.concept testing, 21.current brand landscape
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23.brand positioning, 24.point of difference, 25.competitors, 27.target consumer
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31.the big idea, 31.mission, 31.vision, 32.brand values, 32.brand essence model, 33.brand objectives, 33.marketing mix 4C’s, 34.product range examples, 35.cost, 35.pricing architecture, 37.convenience, 37.communication, 38.busness model, 39.SWOT, 41.brand guidelines
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44.marketing objectives, 45.marketing strategy, 48.implementation, 49.communicaion objectives, 50.digital and social media strategy, 52.key media messages, 53.instagram influencers, 55.pop up store, 56.press release, 57.giveaways
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59.financial objectives, 59.funding, 60.start up costings, 61.marketing budget, 62.profit and loss, 63.measuring the success, 66.risk assessment
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68. the future, 69.conclusion
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72.references, 75.bibliography, 78.illustrations, 80.appendix
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introduction The purpose of this report is to undertake the final realisation phase of a threepart project, exploring the trend of simplicity and minimalism and its growing importance in the business landscape and its effect on consumer behaviour. This final report will focus on a three-year marketing strategy and a communication strategy for a new business that has been created to satisfy a consumer tension and gap in the market found. It will ensure competitive edge and success for the brand now and into the future.
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fig.1
Stage one investigated the relationship between materialism and well-being, focusing on the overwhelming amount of choice consumers are faced with, specifically in the fast-fashion industry, and how this is having an effect on their quality of life.
stage one insights
Freedom is a basic human desire, however, a prominent theme within the research was that even though the freedom of choice has been regarded as positively contributing to a person’s quality of life, the proliferation of choice in today’s society is now doing the opposite. With so much choice out there, it is merely impossible for consumers to know whether they’ve made the best possible decision. For maximizers, the overwhelming choice can be incredibly daunting for them, as they need to assure themselves that every purchase or decision made was the absolute best that could be made. This constant strive for the best is something that might not always be met, and research from stage one showed that this lead to feelings of regret, anxiety and even depression. A clear tension could be seen throughout the report, the abundance of choice now readily available has been proven to rob people of the satisfaction they crave, with primary research showing that millennial’s are overwhelmed by all their options causing them frustration throughout their decisionmaking process. Fast fashion is where the tension is the greatest with millennial’s being inundated with hundreds of options that they then have to sift through in order to find their ‘perfect’ piece. Fashion brands make their millions by continuously making consumers feel out of trend so that the following week they’ll go out and buy more. This fashion cycle is not only having negative implications on consumer’s wellbeing, it is also negatively affecting the environment. Stage one uncovered two possible directions for stage two; to create a service that brands could offer to their consumers that would help them easily filter down their choice, or to build a fashion brand that goes against the traditional fast fashion model, their ethos would be ‘perfecting the basics’, only selling the wardrobe essentials. However, after considering both recommendations and conducting further research, the second idea was chosen.
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aims & objectives [1] To create a new brand concept which aims to encapsulate the key drivers of sustainable consumption in the aims to shift consumer’s attitudes towards buying quality over quantity, which is both financially realistic and commercially viable. [2] To demonstrate an in-depth understanding of the core consumers, scope and positioning of the market that the new concept will sit in to ensure clear brand identity. [3] To create a marketing strategy and communication plan to execute a new business idea in order to build brand awareness and drive sales amongst the recognised target demographic.
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methodology Further research was required, so wvv A survey was undertaken to gain feedback on clothing consumption habits in more detail in regards to ‘what’s in your wardrobe’ and why people stop wearing/dispose of their clothes. It was also used to gain feedback on the business concept. The benefits of a survey are the unrestricted ability of location and therefore enables a greater reach of the sample. However, the method does have its limitations due to its inability to build upon participants responses allowing a greater understanding of the drivers of behaviours, in turn, other primary methods will be used to overcome these limitations. The survey was released to the UK public, targeting females within the millennial demographic age range. It was posted on social media sites such as Facebook, Instagram and LinkedIn, posted on student survey groups on Facebook and distributed to friends and family to complete and share. A total of 127 responses were collected from females with 96% of them being millennial’s, giving a strong indication of consumer behaviours and needs within the target market, which therefore directed subsequent business decisions. (see appendix 1 for a full list of questions and answers) Additionally, a focus group was undertaken in order to gain qualitative insights on consumer perceptions on the idea, perceptions on the current market landscape and to gain further indepth feedback on the business idea. The sample included 5 female millennial’s aged between 21 and 34. The use of this method enables advantages in getting clear opinions and insights from the target market in relation to the business concept, which was highly informative. However, due to the small number of participants, this creates a
limitation of not being able to make the findings representative. Furthermore, an interview was conducted with a digital marketing coordinator in order to gain insights that fed the direction of the idea. The overall aim of the industry insight was to get feedback on the concept and to also adhere to a realistic approach on how to execute a viable business. Secondary research was conducted in order to realise and develop the concept into a feasible business idea. Trend reports such as ‘The State of Fashion 2018’ ultimately guided the direction of the report, where research by WGSN and Euromonitor were the most insightful in terms of validating a new and innovative business idea. Market analysis by Mintel also gave invaluable insights on the size and growth of the desired market entrant. Due to the innovative nature of this report, the majority of secondary resources had to be current in order to keep the idea valid and new.
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further research ten 2%
other 5%
sixty 10%
thirty 26%
One off item 3% No longer fits 9%
Worn too much 11%
Boredem 35%
seventy 12%
Other 11%
fourty 17%
twenty 13%
fifty 15%
fig.2 How much of your whole wardrobe would you say you have worn in the past 6 months?
Further research was undertaken to gain a deeper understanding of millennial’s clothing consumption habits in order to choose the direction of the business idea. The key insights found from the online survey further highlighted the issue of overconsumption in today’s society, which was explored in stage one. The infographic above demonstrates that female millennial’s do not optimise the usage of their wardrobes, with fast fashion trends and overconsumption causing the depreciation in the way in which consumers value their clothing. Boredom and decrease in quality are ultimately the main reason why consumers stop wearing or throw out their clothing. Fast fashion favours quantity over quality and is the cause for this wardrobe trend. Clothing is not reaching its
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Not in trend 11%
Quality 19%
fig.3 What is the main reason you stop wearing/ dispose of your clothing?
maximum usage potential and is cluttering people’s lives. According to Midgley, the average women spends 17 minutes in the morning deciding what to wear, and 1 in 10 women are regularly late to work because of this (Midgley, 2016). This desire to have more than what is needed is negatively affecting both the environment and individuals lives. This research is further supported by a study by Marks & Spencers that found “the average wardrobe in Britain contains 152 items, of which only 44% are worn”(Midgley, 2016). This further research underpins a key tension in today’s fashion industry, which therefore supports the direction of this report to explore and create a business that will simplify wardrobes and can resolve the problem of millennial’s over-consuming clothing.
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fig.4
market overview
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“
The way consumers are shopping for fashion is changing and their expectations are continuing to rise. In a tougher clothing market, it has become even more important for retailers to focus on standing out from the competition through a combination of better product, a seamless online experience and excellent customer service.
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– Tamara Sender Ceron, Fashion business analyst. (Mintel, 2017)
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Even though the clothing retail market is becoming tougher for companies to crack, consumers have still continued to shop despite an uncertain economic backdrop, although sales growth in 2017 has been weaker compared to growth in 2016. With consumers facing increased pressure on their disposable income due to the rise of cost of living they have become more cautious with how and where they spend their money. Mintel (2017) estimated that online sales of clothing would grow by 17.2% to reach ÂŁ16.2 billion in 2017, with online sales now accounting for 24% of total fashion spending. Consumers are now accustomed to the ease of shopping online
and the ease of purchasing by mobile is helping fuel online demand which is why online only retailers are growing at a faster rate than multichannel retailers. Onlineonly retailers such as ASOS completely understand the new needs coming from young consumers, with consumers wanting convenience shopping that fits around their busy lifestyles, which is why the delivery services a brand offers is a key factor that influences consumers to purchase.
2017 ÂŁ57.7bn 2016 ÂŁ55.9bn
fig.5 consumer spending on clothing
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the slow fashion movement Grown from macro trends such as sustainability and simplicity and minimalism, the slow fashion movement has risen as an alternate way to tackle the negative impacts of overconsumption and aims to be the antidote to the ethical and environmental destruction caused by the fast-fashion industry. The concept of slow fashion is to buy better quality items and when purchases are made, they are environmentally and ethically conscious rather than trend-driven. Today’s mainstream fashion industry relies on a globalized mass production where garments are transformed from the design stage to the retail floor in only a few weeks. With retailers selling the latest fashion trends at very low prices, consumers are easily swayed to purchase more than they need. But, this overconsumption comes
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with a hidden price tag on the environment and workers in the supply chain (Dickson et al, 2016). The slow fashion movement aims to result in a gradual return to equilibrium, where societal behaviour is not in conflict with natural resources, and the fashion industry can carry on without compromising the health of the people and our planet. The huge success of fast fashion relies on consumers purchasing products they don’t truly value or need; with consumption unleashing an addictive dopamine hit it can be easy to see why consumers can get trapped in this circle of consumption. However, this ‘high’ is short lived as this feeling fades shortly after the purchase is made, hence why so many people report buyer’s remorse, an insight found in
stage one. Decisions in fast fashion are emotionally led not rational, giving humans the satisfaction they crave from a purchase. Slow fashion does not take anything away from this and consumers can still get the satisfaction they desire but from one item instead of a few. It does this by “meeting human needs by co-creating garments and offering fashion with emotional significance. By telling the story behind a garment or inviting the customer to be part of the design process, the needs of creativity, identity and participation can be satisfied” (Dickson et al, 2016). Consumers gain satisfaction from knowing they have purchased a product that is not harming people or the planet and will last them a lifetime.
fig.6
fig.7 15
buying less but better As identified previously, fast fashion has led to the depreciation in the way in which consumers value their clothing. Consumers have become accustomed to buying new clothes with the intention of only wearing them a few times. The survey found that the second most common reason why people dispose of/stop wearing their clothing is that they are no longer satisfactory quality, this is down to fast fashion favouring quantity over quality, they design clothes that aren’t build to last. Further research found this to be a common frustration with consumers, and in a time of economic uncertainty, people are becoming more aware of what they choose to spend their money on and no longer are consumers willing to invest in garments that they know won’t last them the year. According to Mintel (2017), they found that this was true for 69% of women aged 25-44 as they showed signs of buying less but better. Societal shifts such as urbanization are subsequently driving the trend of buying less but better. According to the UN, by 2030, urban areas are projected to house 60 percent of people globally (UN, 2016). People living in urban areas are likely to benefit from buying less but better, due to storage constraints that come as a result of living in overcrowded cities. Such population density will drive the need for cutting down on clutter in the home in order to make room for things that are more important. Such shifts have also inspired the growing trend that is minimalist living as consumers seek to cut down on the amount of stuff they own in order to declutter their lifestyles.
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millennial consumer The increase in popularity of the slow fashion movement is also due to the change in consumer mindset and values. Euromonitor highlight in their New Consumerism trend report that “consumers are reassessing their priorities and are increasingly asking themselves what they truly value” (Boumphrey, 2016). With the shift in values, a common theme for consumers is to buy less but better, prioritising quality over quantity. A demographic pioneering this movement are the millennials. “Millennial’s are born between 1980 and 2000. They have grown up in a time of rapid change, giving them a set of priorities and expectations sharply different from previous generations” (Goldman Sachs, 2018). As they reach prime working and spending years, their impact on the economy is going to be huge. Millennial’s do a lot of things differently to their parents and with new data looking at their spending habits, they are frustrating retailers as they defy consumption patterns that previous generations have followed for years. Not only are millennial’s far less likely to buy something because it’s convenient they are also less likely to spend their money unnecessarily than previous generations. Brands need to know that millennial’s prefer to do business with corporations and brands with pro-social messages, sustainable manufacturing methods and ethical business standards (Landrum, 2017). The driver of this conscious consumer comes as a result of hyperconsumption, and the fact that consumers are becoming more aware of the effects this is having on the planet.
fig.8
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the minimalist millennial This minimalistic lifestyle is not a new concept, however, in recent years it has become highly commercialised with authors such as Marie Kondo who capitalised off her book ‘The Life-Changing Magic of Tidying Up’ brought the trend to the mainstream. The movement has inspired people to move into tiny homes, donate their possessions and cut down their wardrobes. Millennial’s, in particular, are seeking out this minimalist lifestyle. They grew up during the recession, entered a struggling job market and must now pay off record amounts of student debt, motivating them to be more cautious with what they spend their money on. For fashion retailers, this lifestyle poses
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a threat to them, this is a population that is bigger than the boomers in population, but their wallets are smaller. This trend highlights the millennial generations desire to take interest in the style of life than the stuff of life, causing them to shop less (Lewis, 2016). The retail industry, specifically fashion, must therefore rethink their positioning, offering and marketing to ensure future appeal. By shifting to a business model that encapsulates the minimalist lifestyle in a way that offers consumers products that favour quality over quantity in order for them to simplify their wardrobes, would therefore be highly beneficial.
PESTLE analysis A PESTLE analysis was undertaken to gain an overview of the external business environment. Numerous factors were taken into consideration in order to widen the perspective of this project in terms of key market drivers and influencers. An in depth copy of the PESTLE can be found in the appendix of this report, however, it will be referred to throughout the report where relevant and will influence the direction of the report numerous times.
opportunities As discussed earlier, consumers are not getting full usage out of their wardrobes and are buying more than they need, with them only wearing around 40% of their clothing with the remaining items being an unnecessary use of resources that in many cases will end up in landfill. As a result, new sustainable business practices are emerging in the attempt to put a stop to this overconsumption and to ultimately to reduce
the amount of clothing that is wasted by sitting in a wardrobe and not fulfilling its lifetime potential. The fast fashion industry is the main point of concern, brands that incorporate both the slow fashion movement and the minimalist lifestyle into their ethos will thrive and meet the needs of the millennial consumer.
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fig.9
the concept The business concept is to create a womenswear brand that offers high-quality basics and wardrobe essentials in order to pursue a sustainable form of consumption and to influence customers to simplify what’s in their wardrobes. The brand will be called ‘thread’ and will promote itself as a way for customers to create their perfect capsule wardrobe. The opportunity was identified through the combination of stage one insights, the macro environment, the micro environment and industry trends. The key industry drivers of the slow fashion movement ultimately highlight the change in consumer’s behaviours, which has been compelled by numerous factors. However, these behaviours don’t necessarily stem from the aspiration to be sustainable, which demonstrates that tapping into pre-existing needs and trends, can be the
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key to motivating conscious consumption and influencing consumers to buy less but better. Stage one identified that consumers are overwhelmed by the choice that fashion brands offer to them which encourages them to stop making choice all together. However, a brand that cares about style not trends will cut down the choice it offers to consumers, which will combat this frustration.
Cline says “for these new, durability-focused companies, their success lies in providing a true antidote to fast-fashion: ultra high-quality clothing, made sustainably, that people can afford” (Cline, 2016) which is exactly what this business concept aims to do. Another insight found through research shows that consumers make frequent clothing purchases due to the ‘good feeling’ it gives you. By promising consumers high quality items, that will last them a lifetime and doesn’t harm people or the planet, it will still give them that ‘good feeling’ that they crave.
concept testing PARTICIPANT
INSIGHT
Participant 1
- Thinks the high street lacks a concept like this, many brands offer basics but they’re not quality at all. -In the long run it would be more cost effective to buy less but better, you may be paying more but it’s an investment.
Participant 2
-Like the idea of being able to build herself a capsule wardrobe but still being stylish. -The word basic can sometimes connote boring, the collection would still need to be young and fashionable.
Participant 3
-Would have to trust the brand 100% before they purchased from them. -Would rather have less clothing in her wardrobe but love every item. -More people could benefit from buying less but better, brands should promote the benefits of this lifestyle.
Participant 4
-Good reviews online always help sway her purchases, especially for brands she’s never heard of. -Would feel better buying from a brand that has good morals and is trying to make a positive change.
Participant 5
-A brand that has less choice would make her think that they’ve spent more time on the products that they do sell. -Thinks that sometimes basics can mean boring, the brand would have to promote its style. fig.10 concept testing
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Not sure 9%
No 11%
Yes 80%
fig.11 Would you be more inclined to purchase from a brand if you knew their products were designed to last longer?
The insights gained from testing the concept proved that there is certainly an appeal for a womenswear clothing brand that focuses’ on quality, not quantity, demonstrated through the infographic above. The interviewed participants weren’t aware of any other brands that that had the same USP (as shown in appendix 2). This therefore confirms the opportunity to turn the big idea into a feasible business concept that meets the needs of millennial consumers. The research reinstates the problem (as identified in stage one) that consumers are overwhelmed by the choice fast fashion brands offer them and they get frustrated at how disposable brands make their clothes. Leaving them with a large percentage
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of clothes in their wardrobe they do not wear, which is extremely unsustainable. A clothing company that encourages customers to buy less but better will allow consumers to declutter their lives/wardrobes, saving them time and energy. The core demand for quality pieces is ultimately for capsule wardrobe essentials, which has been proven to be their go-to items.
current brand landscape After researching into brands on a global basis, it was made apparent that the US had brands with a similar USP to the new business concept previously discussed. There are numerous brands that have entered the US market offering either quality basics or capsule wardrobe essentials such as Everlane who have shown significant success over the last few years. All but one do not ship to the UK, however, Grana have recently started shipping to the UK but for a high price, so they will be penetrating both markets. When identifying similar brands in the UK landscape, it looked notably different. There are very few womenswear brands that operate in the UK that voice their USP as offering high quality basics and are influencing customers to purchase less but better, which is highlighted on the perceptual map.
The focus group was used to gain feedback on the current offering on the UK market (see appendix for focus group responses). A prominent theme that came from this research was the consumer’s need for trust, especially in relation to the brand’s claims. Consumers said that they would need to trust a brand 100% before purchasing a higher priced item; brands do this by being completely transparent with their consumers. Therefore, in order to successfully penetrate the market, it would be beneficially to have honesty as a core value for the brand.
The primary research found that if consumers are looking for basics they usually purchase them at high street brands due to their low price, however, they do not last them more than a year. It also highlighted the lack of awareness for womenswear brands that did offer high-quality basics. The question, “Can you think of any other brands that are similar to the business concept proposed?” was asked to the target demographic, and only one brand was mentioned in the responses, which was All Saints. This clearly shows that the brands that do exist within the market are not recognised with millennial’s, which means there is a gap in the market which aims to fulfil the changing needs of the consumer.
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fig.12
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brand positioning
fig.13 brand positioning map
*Fast-fashion vs. Slow-fashion can also be interpreted as quantity vs. quality The brand-positioning map identifies where thread will be positioned within the fashion industry. Thread positions itself as a brand that finds the perfect balance between its slow fashion ethos and price. A true visionary whom has recognised the change in the way that consumers choose to shop, by desiring to purchase less but better.
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point of difference The map shows that’s threads main competitors are small brands P.i.C Style and Cossac who also influence their consumers to buy less but better. However, they offer contemporary items that will only appeal to people with a certain style and can no be classified as ‘basics’. Threads point of difference in the market is to be the first brand that offers customers high-quality ‘traditional’ basics that are manufactured in the UK, in an edited capsule wardrobe range, that through primary research were found to be what consumers want to invest in. The brand believes in quality over quantity and will try to educate its audience on the benefits shopping of at Thread can have on their lifestyle in comparison to fast fashion brands. Their job is to bring the customer only the best.
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competitors P.i.C Style (Direct)
Strengths
Weaknesses
Impacts
-Manufactured in the UK -All fabrics are locally sourced, sustainable and organic -Stocks other brands that share their ethos -Fashionable, young pieces -Featured in a wide range of press and The Independent features P.i.C Style in there article ’12 best sustainable brands for women.’
-Their social media strategy is very poor. The channels aren’t updated frequently and the content isn’t very engaging. -Their twitter only has 278 followers, instagram 3,222, Facebook 279 likes. (Poor following) -Difficult to find through search engines
P.i.C Style operate a similar business so the target consumers could be more inclined to choose the competition over Thread. However, millennial’s are more inclined to trust a brand through its partnerships with influencers, which this brand is lacking. Its lack of social media presence is a weakness for P.i.C style, this therefore means that Thread must ensure they partner with relevant social media influencers to gain customers trust and to increase their social media presence to attract more customers.
-Small social media following (Instagram – 8k followers, Facebook – 197 likes) No twitter account. -Very difficult to find in search engines. -Low brand recognition. -The shopability of the website is difficult, and product images do not advertise to garments well.
The brand does focus on buying less but better with sustainable, quality clothing, however, the brand is very small scale, which can be seen through its small social media following. The clothing is priced between £60-£150 depending on the garment style so would be placed in mid-market pricing which will be similar to thread. Primary research showed that consumers need to trust brands before purchasing from them, the website appearance is difficult to shop with product imagery making it hard to see what’s being sold which could lead to a lack of trust between the brand and consumer. This therefore means that thread must ensure their website looks visually appeal and is simple to shop in order to give them the competitive edge over COSSAC.
COSSAC -Partners with 27 stockists. (Direct)
-Committed to slow fashion and sustainability. -All production is carried out in Europe, in Portugal and Turkey in ISO and GOTScertified factories. -Featured in specialist, independent magazine to appeal to a niche audience. -First pop up store will be in May.
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Strengths
Weaknesses
Impacts
Wardrobe NYC (Direct)
-Credible founder and designer, Christine Centenera, the stylist and fashion director of Vogue Australia. -High quality, designers promise the pieces are for a lifetime. -Highly featured in press such as the New York Times and Vogue Australia. -Celebrity ambassadors of the brand include Rosie Huntington Whitley and Margot Robbie.
-Consumers can not purchase pieces from the collection separately, have to commit to either half or the full collection. -Luxury clothing equals luxury price, full collection costs £2,500.
Wardrobe NYC have the same aim as thread, they want to simplify getting dressed by only offering an edited collection of high quality basics. There will be close similarities between the brands, however, Wardrobe NYC offer luxury clothing at a luxury price and are in a completely different market to thread. They are a direct competitor, but they will only appeal to the millennial’s that can afford to shop within the luxury market. Another weakness for the brand is that they do not let customers purchase items individually, which takes away the customers freedom to mix and match between the collection. Thread will allow customers to have the freedom to only invest in the pieces they need which will give them a competitive edge.
MANGO (indirect)
-Well established and trusted on the high street. -Highly recognised by the media, PR and influencers. -Strong social media presence and following with high engagement. -A wide product portfolio with classic styles and basics. Competitive pricing.
-Another fast-fashion brand, their focus isn’t on quality. -1000’s of options can overwhelm customers. -One of the European retailers involved with the Rana Plaza building collapse in Bangladesh in 2013.
Mango is an established fastfashion brand that focus on trend led collections, therefore, are not necessarily a direct competitor, however, they do sell a lot of classic pieces and basics at a competitive price that customers could create a capsule wardrobe with. They benefit from low prices, which could entice customers that are still weary about investing in quality pieces that aren’t priced at fast fashion prices. Thread will need to differentiate themselves by promoting their USP and positive brand values to gain trust from the unsure consumers. fig.14 competitor analysis
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target consumer the minimalist
yearly income: ÂŁ24,000
fig.15
The 24 year old openly admits to having a small wardrobe but loves to document how she keeps stylish by mix and matching what she does own (and to get likes). She has just completed her first year at her dream job and rents a small city centre flat alone; she browses the Internet most days looking for her next investment piece and only visits the high street once or twice a month. She loves to travel and go away on weekend breaks where she has to pack light, and of course this is all well documented on her instagram feed.
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the workaholic
yearly income: £45,000
fig.16
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This 29-year-old female works full time in central London at her busy office job. She lives in a spacious 2-bedroom house just outside the city centre with her soon to be husband (which wedding she is currently saving for). She is a busy woman who wants to simplify the “what do I wear today?” conundrum which she faces most morning before work, yet still likes to be effortlessly stylish. She often ends up making purchases on her mobile on her lunch break, as she doesn’t have time to visit the high street because she likes to keep her weekends free to spend time with friends and family. She doesn’t care much for the latest trends she just buys what she needs and loves.
the conscious consumer
yearly income: ÂŁ32,000
fig.17
This 31-year-old female lives in a small town with her husband and young daughter. University educated with a job as a teacher, she has a very hectic lifestyle and doesn’t have much time for herself or shopping, therefore the few clothes she does buy are ordered online and delivered to her home. She is very conscious about where her clothes are from and their impact on the environment and is also educating her daughter on this, as she grows older. She loves open and honest companies, which means she doesn’t have to spend hours researching their corporate responsibilities.
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5
thread. thread. thread.
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fig.18
the big idea Thread is a British womenswear label founded in 2018. They offer minimal basics and wardrobe essentials of the highest quality, at a friendly price. Their goal is to help the customer get through the day with style and dignity – whether it’s a hectic day at the office, a long awaited catch up with friends or even the early morning school run. Thread helps them get through the triumphs and troubles of everyday life. They would rather make one exceptional dress than three mediocre ones – their aim is to perfect the essentials. Every t-shirt, jumper and pair of trousers a customer buys from Thread is a result of a never-ending strive for excellence. They obsess about the details and perfecting the final piece, meaning that
many garments die along the way. Their job is to bring customer only the best. Thread is concerned with style, not trends. They make clothes that stand the test of time and deserve a place in people’s wardrobe. They’re less concerned with the fads of the day in the ever-accelerating world of fashion, just the essentials that will never lose their relevance. They aim to give people the room and time they need for the things they truly care about.
mission Thread aims to encourage people to buy less but better in order to simplify and declutter their lives in order to make time for the things that matter the most whilst upholding sustainable values.
vision Thread strives to rewrite the rulebook of fashion; through revolutionising the meaning of less is more.
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brand values Style over trends Thread is concerned with making garments that will stand the test of time, not be in and out of fashion within a month. Honesty Honestly and transparency are the core of our values, we are honest with customer about our company promise to give them perfectly thought out clothing at a friendly price. Quality assured We strive to ensure that our products are of a luxury standard and maintain this high standard of quality at all times. Sustainable consumption Sustainable consumption is at the heart of our business model and we encourage all our customers to be aware of the effects their consumption has on the environment.
brand essence model Attributes Approachable Practical Encouraging Versatile Personality Trustworthy Classic Confident Style Conscious
perfecting the basics
Promise Quality Value Honesty Essentials Source of Authority Expertly crafted quality products Commitment to sustainability fig.19 brand essence model
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business objectives These corporate objectives outline the strategy for thread over the next three years. [1] To be an innovator and market leader within the slow fashion market within the next three years. [2] To increase annual sales year on year by 50% [3] To plan and implement a pop up store by the end of year 2 to increase brand loyalty and increase sales in year two.
marketing mix 4C’s consumer needs The primary research questioned what type of clothing millennial’s would prefer to invest in and also asked what were people most worn items in their wardrobes, suggesting that the product offering must abide by these specifications. The primary research found that consumers are buying clothes less frequent than they use to, this was also further supported by Mintel who have found that ‘the majority of shoppers only buy clothes every two or three months, less than shopper were last year’ (Mintel, 2017). There is a growing trend with consumers to buy less clothing and to invest in quality assured clothing when they do. The primary research gave further insight as to why the consumer is now choosing to buy less but better, which demonstrates the need for Thread. An example includes: ‘I’m quite passionate about (buying less but better) and its something that everyone should do. Id also like brands to value this more, I understand they have to make money but this fast fashion life we live is not healthy for anyone. I’m happy buying less because in the long run it makes getting dressed so much easier and saves you so much money.’
All the responses reflected a customer frustration towards keeping up with fast-fashion trends and their commitment to quantity over quality. This therefore means that the introductory capsule range will include timeless items (influenced by primary research) that focus on quality in order to ensure that the product appeals to the target audience. The choice to create a range that is made up of only 8 items was decided after insights found from stage one, which found that consumers are overwhelmed by choice that fashion offers them, and this sometimes leads to them not making decisions at all, which could link to the trend that shows people now buying less. A range plan has been drawn up in order to strategically manage the functioning of the business. The plan was made for the initial capsule range for year one, which is made up of 8 items, it also shows the manufacturing costs of each item and the retail selling price in order to show its profit margin. (see appendix 8)
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product range examples
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fig.20 range plan
cost Costing decisions must be considered as a part of the marketing mix in order for the business to attract new customers, but to ultimately ensure that profits are achieved. Threads capsule range will be priced from £30 to £350. The justification of this pricing was based on responses during the focus group, which gave insights into how much the target market would be willing to pay for such items. Competitor’s prices further determined the justification of the cost. P.i.C Style prices range from £60 to £155, where the price varies for different styles of clothing. Looking at competitor’s prices is such a strong indication as what consumers would willingly pay, however, threads pricing also took into consideration its brand values to make sure it was friendly and gave it a competitive edge. Objectives of the marketing plan and business much be taken into consideration to make sure that the cost of the products ensure that revenue targets are met. As one
of the business’ objectives to be profitable, the products must generate enough income to cover the running and the variable costs that come with starting a business, whilst also making a profit. Applying this to Thread, the pricing of the capsule collection must cover the cost to produce the garment, as well as the running and variable costs that brand occurs. Costs to consider include: Wholesale cost of garments Delivery Packaging Website creation Staff Insurance Marketing Warehouse space
pricing architecture The range follows a simple pricing architecture, offering a range of prices from low to high within the mid-premium market level to be accessible to all consumer segments. The pricing architecture is set based on the cost of manufacturing the products, which varies depending on the garment. -The lowest priced product offers consumers affordable entry-level products, this includes the long sleeve and short sleeve t-shirts. -Threads mid-price products offer numerous styles; with a higher profit margin these will be the styles that drive Threads profits. -Top-priced products include the leather jacket and wool coat, these products will be stocked in lower volumes, as they will help maintain exclusivity for the smaller percentage of people who can afford them. 37
fig. 21 desktop website
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convenience By understand the shopping behaviour of the target demographic; appropriate channels must be adopted to make sure that the consumer can access the product available with ease and convenience. In a digital age consumers are impatient, “the digital world has schooled more consumers into becoming so-called “ “I want what I want when I want it” consumers, impulsive and in pursuit of immediate gratification” (Euromonitor, 2017). In order to achieve optimum sales, Thread must ensure that the service they provide is exceptionally convenient to use due to the necessity of both receiving and returning the products in a quick manner. Millennial women are now the biggest demographic that make up online fashion shoppers, with 85% of them having bought their clothes online in the last year (Mintel, 2017). Thread will function completely through its online website which will therefore attract the core target market of millennial’s due to the convenience
that ecommerce offers them. Mobile commerce is also showing to be a key driver of purchasing within the millennial demographic. “Consumers have been mobile-first for a while now: mobile data traffic has surpassed that of desktop, and half of millennial’s spend more than three hours every day on their devices” (The Business of Fashion, 2017). Thread will therefore make sure that their website is mobile optimised, to give mobile users the same level of convenience and experience they would have online, and therefore gain increasing sales due to the growth of mobile commerce.
communications The communication strategy will focus on creating a meaningful relationship between Thread and its audience with a focus on determining what the consumer needs. A more detailed overview of the communications can be found in the next chapter, which will further explain how Thread can use their communication channels to promote product, gain consumer insights and create customer confidence in the brand.
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business model Thread will trade as an ecommerce store, customers will only be able to purchase Thread products through their dedicated website. Ecommerce is growing for various reasons, and “with 87% of UK consumers claiming to have bought at least one item online in the last year� (Webkick, 2017) it is the perfect platform for Thread to launch onto. Not only does ecommerce come with smaller overheads that physical stores, it is more convenient for the consumers, being online means that people can shop 24/7 from wherever they are.
brands at the lowest minimum order quantity in the industry. Using a UK manufacturer was always favourable for Thread as transparency and sustainability are at the core of the brands essence, so doing this will reduce the brands carbon footprint.
Thread will use a UK manufacturer, such as Hawthorn who are a leading clothing manufacturer in the UK, producing high quality garments for small to medium fashion
manufacturer thread. customer fig.22 business model
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SWOT analysis strengths 1. The brands purpose is to minimise consumption through influencing consumers to buy less but better. This is clearly a viable solution to issues discovered in stage one surrounding fast fashion, materialism and over-consumption. According to WRAP ‘garments that last longer reduce production and processing impacts’ (WRAP, 2017). By producing high quality garments that are built to last, not only will this have positive effects of the customer’s lifestyle (e.g. simplifying choice and saving money) it will also save on unnecessary production of new clothing and minimise waste. 2. As a brand that is an early adopter of the slow fashion movement, a trend that is gaining momentum and predicted to grow massively in the next few years, they therefore will be at the forefront of the new direction that the fashion industry is being influenced to head in and it is a way they can ensure point of differentiation in the market. 3. Full transparency allows the brand to create an honest and open relationship with its consumers, creating strong brand trust. Being honest with its corporate responsibly and being environmental responsible is an attractive trait for consumers particularly those of the conscious consumer. 4. Being on online business means start up costs and overhead costs are relatively low allowing room for early profitability. Online fashion sales have soared in the past five years, doubling in value since 2012 (Mintel, 2017) proving that online is a commercially viable platform for a start up business to begin on.
weaknesses 1. Having no physical store limits the brand to ecommerce and could disregard the customers that still need to touch, see and feel the product before buying it. However, a way to overcome this is to ensure that the brand offer a completely free returns policy and an easy customer service experience if they have any issues. 2. Initially thread will only sell online on their own site, this limits the brand exposure and as they are not partnering with other platforms to stock their products. Platforms offer convenience and a breadth of offering, so in order to overcome this, thread must make sure their website offers the convenience and ease that other platforms offer. However, in the future as the brand awareness grow, this is an opportunity for them.
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opportunities 1. As the brand gain popularity and momentum, it could expand and open its first pop-up store. A pop up store allows the brand to communicate its brand promise to consumers through the use of a unique and engaging environment whilst creating an immersive shopping experience. 2. If successful with its first capsule wardrobe collection, it could expand its offering by asking consumers what other items they would like the brand to perfect, this could also include accessories and footwear. 3. To diversify into the menswear market and offer a capsule wardrobe targeted to millennial males. 4. A key finding through the focus group (see appendix) was that influencers were an effective way for customers to be introduced to the brand in a trusting way. Therefore, the brand could partner with relevant influencers to be ambassadors for thread, promoting their products in a natural and transparent way. This will also open up the brand to a wider audience and increase brand awareness.
threats 1. There is a threat of other brands offering a similar capsule wardrobe collection in the future, which could potentially lead to the market becoming more competitive. 2. According to Forbes, nine out of ten start-ups fail (Patel, 2015). The tough economic climate makes it a difficult environment for business to grow in, however, with hard work and commitment, thread could easily be in the 10% that thrive. 3. Consumer spending is down to how much disposable income individuals have which is linked to the economy, at a time of uncertainty this could decrease consumer spending, negatively affecting the fashion market and thread. (See PESTLE for a more in-depth analysis)
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brand guidelines
thread. “Simple logo design is memorable, people are more likely to trust something they’re familiar with, so they need to be able to recall your logo easily” (Bowker, 2014). The thread logo was designed to be simple and minimal to showcase the brand image easily. Other logos were created however, primary research showed that the one selected was favoured with the respondents as they thought the font was easy to read and they liked the simple use of the full stop as it gave the logo a unique edge. (see appendix for full responses)
CMYK 0 / 0 / 0 / 100 RGB 0 / 0 / 0
CMYK 66 / 14 / 17 / 0 RGB 75 / 172 / 198
CMYK 0 / 0 / 0 / 0 RGB 225 / 225 / 225
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Serif Black ABCDEFGHIJKLMNOPQRST UVWXYZ abcdefghijklmnopqrstuv wxyz 0123456789 Helvectica Neue ABCDEFGHIJKLMNO PQRSTUVWXYZ abcdefghijklmnopqr stuvwxyz 0123456789
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6
fig. 23
45
marketing objectives [1] To launch Thread by the end of November 2018 in order to achieve optimum sales around the Christmas period. [2] To increase threads brand awareness through social media following, PR reach and word of mouth. [3] To establish Thread as a recognisable and desirable brand for its target audience in order to achieve a profit of ÂŁ150,000 at the end of year three.
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marketing strategy year one Pre Launch (June 2018 –October 2018) The pre launch will concentrate on setting up the brand, scouting suppliers and creating the website. To minimise overheads the brand will operate from home for the first year. Set up involves registering the domain name, setting up a limited company, ensuring funding is in place, arranging insurance cover, securing a contract with a courier service, creating the website via a freelance designer and ensuring the brand personality and identity is established and visible in all aspect of the brand. Launch (November 2018) Surrounding the launch of Thread, the brand will be doing a giveaway on their instagram in order to increase brand awareness and to increase their social media following. The prize of the giveaway will be £500 worth of credit to use on the site, in order to be eligible for the giveaway, participants much follow the brand on their instagram page and tag two friends who would also love to enter the giveaway. The giveaway will be promoted across all social media platforms and the website in order to attract more entrants. The giveaway will run for a total of 4 weeks to give maximum exposure. After Launch (December 2018 – May 2019) The after launch will focus on increasing brand awareness in the hope that this will translate into sales. This period is an important time for Thread, it will focus on establishing the brand in the market, building a strong social media presence and creating brand awareness through a consumer focused marketing strategy. The brand will collaborate with two instagram influencers that have been identified in the communication plan, they will post do two posts each, one in December 2018 and another in April 2019.
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fig.24
year two Once Thread has established an online presence, the second stage is to create further awareness and increase followings by increasing engagement with consumers and getting them involved. It will also achieve this by collaborating with relevant influencers again on Instagram, which will also help increase consumer trust. This time they will do 4 posts each, one every three months promoting product and giving customers a discount code to encourage people to make purchases. The beginning of year 2 will also see Thread asking followers across all platforms what items they would like to see be added to the capsule collection. Followers can comment on dedicated posts what item that would like to see Thread ‘perfect’ next, from the comments the 2 most popular items will be created and launched at the 48
pop up store. The end of year two will see Thread holding their first pop-up store, which will be heavily advertised on social media and in the press during the run up to this event to create awareness and interest. This will also help establish Thread as a key market player and by introducing the brand to wider audience it will increase customer base and loyalty.
year three Year three will continue focusing on building social media presence in order to communicate and build trustworthy relationships with existing customers and to reach new customers to help increase sales and ensure profits are made. The second half of the year will also see Thread expanding their range into footwear and accessories; this will increase customer base, profit margins and update the brand to keep it fresh and exciting to ensure growth. Introductory offers with relevant publications that are purchased by the target market will be used to promote the expansion of footwear and accessories. As the business grows, the marketing budget grows with it, this allows for more money and time to be invested in the marketing and communication strategy to achieve optimum sales. More money will be invested in social media promotion and Instagram influencers in order to increase following and brand awareness.
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strategy implementation JUN-AUG
SEP-NOV
DEC-FEB
MAR-MAY
MARKETING TIMELINE 2018-2019 Initial set up (buying domain and registering) Manufacturing products Website development Social media launch Website goes live Brand launch
Press releases sent out Launch giveaway
Instagram influence posts Promoted Facebook posts
Promoted Instagram posts Email marketing
MARKETING TIMELINE 2019-2020 Hire Digital marketing executive Instagram influence posts Promoted Facebook posts
Promoted Instagram posts Giveaways
New items for range post
Pre popup store promotion Pop up store launch Email marketing
MARKETING TIMELINE 2020-2021 Instagram influence posts Promoted Facebook posts
Promoted Instagram posts Giveaways
Press releases Publications
Pre range expansion promotion Range expansion launch Email Marketing 50
fig.25 strategy timeline
communication objectives [1] To successful penetrate the UK fashion market, by generating brand awareness of Thread amongst its core target demographic of millennial’s to see a 20% increase of sales per year. [2] To increase the social media following on the Instagram platform by 50% each year. [3] To focus on engaging customers through email marketing, acquiring at least 5,000 new subscribers to the monthly email per year. [4] To see website traffic increase by 10% month by month.
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digital and social media strategy Social media is increasingly becoming a vital channel of communication for both brands and consumers to communicate with each other. When it comes to targeting millennial’s, social media is one of the most effective forms of communication due to the extensive use of such platforms by this generation. Millennial’s spend on average six to seven hours a week on social media (Neilsen, 2017), therefore, Thread will have a strong social media presence across a multitude of platforms including, Instagram, Facebook and Twitter. All of which will have a different purpose and target different consumer types. The selected platforms have been chosen because of the benefits they
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will bring to the brand, which will be explained further below. Keeping social accounts up to date and responding to customers via these platforms is time-consuming and as a startup Thread will not have a full dedicated social media team, just one staff member, therefore Thread will not be using all social accounts so they can focus on keeping the content high quality. By penetrating each form of social media, Thread will increase their brand awareness and increase their chances of reaching their target audience.
Platform
Customer experience and benefit for the brand
Website
The website will be the key point of interaction between the brand and consumer so it must be extremely efficient and easy to use. The website will operate from the domain, www.threadclothing.co.uk as it first enters the market. It will be visually appealing with a clean, simple design which will align with its own branding. The website will be fully mobile optimised so that consumers have the same, great experience no matter what device they visit the website on. The website will also be fully integrated with its social media sites and will have direct links to all platforms. The website will be launched as soon as the business infrastructure has been completed in year one (November 2018) and will be built and maintained by the team member dedicated to digital and social media.
Instagram is quickly becoming one of the most influential social media platforms (see PESTLE for in-depth analysis) and is an engaging communication channel for the millennial generation. It is also a great way to create persuasive user-generated content that is extremely popular with the target audience, which was found during primary research (see appendix). The Instagram will run from the domain @threadclothing and will post a variety of visually stimulating content that reflects the brand’s essence and promotes the product. It will aim to post at least once a day in order to keep the Instagram feed fresh and engaging. It will also post photos of customers who have purchased product from Thread in order to inspire other followers to purchase from the brand and to inspire them on how to style the product they buy.
Twitter will be used as a platform to interact with consumers and help build brand presence. It will take the same domain as Instagram @threadclothing in order to keep constancy between platforms and to make it easily recognisable. By operating a twitter account it allows the brand to engage in two-way communication with consumers where the brand can easily respond to any comments, complaints or general questions. The content on the twitter page will be engaging, informative and will capture the brands essence.
According to Constine, “Facebook now has 1.4 billion daily users and is still continuing to grow” (Constine, 2018), therefore Thread will have its own dedicated facebook page. This will act as another channel of communication to promote products and keep customers up to date with any upcoming events or new products. It will also act in a similar way to twitter, where the brand can respond to customer comments to ensure customer satisfaction is consistent.
Email Marketing
According to WGSN, email marketing as an industry year-over-year is continuing to grow at 20% and nearly 40 times more effective than Facebook for acquiring customers, and it is millennial’s that are purchasing the most from these emails (WGSN, 2016). For that reason, email marketing will be utilised for the start-up and running of Thread. The website will allow customers to sign up for monthly emails that allow the brand to communicate with customers and potential customers, increasing sales and brand presence. WSGN also highlight that millennials prefer reading emails on their mobile devices (WGSN, 2016). Just like the website the emails must be mobile optimised in order to create a seamless experience no matter what device they are read on. fig.26 digital and social media platforms
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key media messages #mythread Threads instagram account will use the hashtag #mythread in the hope that customers will post pictures of them wearing or advertising product they have purchased from Thread, in order to encourage peer to peer influencing which is extremely important in building brand awareness and trust. By allowing customers to create user generated content with the potential of being reposted by Thread, potential customers might be more inclined to make a purchase. Buy less, buy better Buy less, buy better will act as a tagline for the brand, to ultimately sum up what the business is about and what their core essence is. “A tagline is a short phrase that captures a companies brand essence, personality and positioning to help create an interest� (Wheeler, 2018). The tagline will be used within branding, especially on the website and across social media sites as a hashtag.
fig.27 instagram profile 54
instagram influencer marketing “Adding Instagram influencer marketing into your overall strategy for Instagram can help to increase your brand awareness, grow your follower base, and drive major sales” (Gilbert, 2018). Millennial’s are strongly influenced by social media posts; especially on instagram, which presents Thread with the opportunity to visual incise customers to make a purchase. “When an influencer recommends a product or service on their channels, it can come across as an authentic recommendation from a friend” (Gilbert, 2018). Primary research further supports this, as participants in the focus group said they were easily influenced by people
they follow, as they trust what they have to say (see appendix). Thread will engage in instagram influencer marketing in order to reach its target demographic on the platform. The influencer’s chosen will ultimately act as a tool to increase brand awareness and increase sales by promoting Thread products.
Which influencers to choose? Careful consideration must be taken in order to choose which influencers should help promote the brand, the influencers must represent the brand essence and values to attract the target audience. The influencers will be paid their set rate per post, each post on both feeds will have a strong reach due to the amount of followers and average photo likes* the influencer usually attracts. The influencers will also be given a 10% discount code to give to their followers as an incentive to make a purchase from the brand.
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fig.28
Matila/ @matildatheminimalist 109K followers Average photo likes: 3,750 Average engagement: 3.5% Matilda is a UK instagrammer and openly calls herself a minimalist, she does not have a big wardrobe and loves sharing with her followers how she keeps stylish and makes a multitude of outfits from her small collection of clothes. She shares the same values that Thread uphold of honesty, quality and sustainably, showing she will be able to successfully promote Thread and its essence to her followers.
Brittany Bathgate @brittanybathgate 179K followers Average photo likes: 5,800 Average engagement: 3.3% Brittany is another UK based instagrammer and blogger, her curated feed and personal style is classic and clean, which represents the aesthetic of Thread perfectly. Brittany has a high engagement rate which means her followers are paying attention and taking action to the content that she is posting, this is an appealing factor for a start up business such as Thread.
fig.29
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pop up store In order for Thread to increasingly engage consumers and get people talking about the brand, a pop up store will be held towards the end of year 2. Not only will the event promote the importance of slow fashion and its positive effects on the environment and customer’s lifestyle, it will also be the introduction to new products that have been added to the range. Not only is a pop up store a great way for Thread to earn some extra revenue on top of its ecommerce stream, “pop-ups draw customers into their store and create a memorable experience. It is these types of memorable experiences that help to create brand loyalty and excitement” (Newton, 2016). The pop up event will also encourage customers to post online about their experience using Threads hashtag #mythread to create a buzz online and to organically promote the brand to increase awareness. The pop up will be located in a small retail space in London, holding the event in a large city will make it easily accessible to ensure maximum impact and conversation.
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public relations Thread will hire a PR intern to generate press releases surrounding the launch of the business (see appendix for example release). The PR strategy will act as a way to accelerate the marketing communication previously outlined. The PR strategy will also focus on building trust, reputation and stronger relationship with the public and the relevant media publications, this will be especially important in the first six months of the business running. Publications such as; The Gentlewoman, Mochni and Cereal will be sent the press release in the hope that
they will feature Thread in their publication. These publications target the three consumer categories identified earlier and if Thread was to be published in any of these it would increase brand awareness and could lead to an increase in sales.
fig.30 magazine article mock up
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giveaways Thread will host giveaways in all three years of their marketing strategy; the first one will be a part of the launch of the business concept. Studies show that giveaways are still incredibly effective in boosting brand exposure, and ultimately increasing sales (Lobel, 2016). The launch giveaway will give one instagram follower ÂŁ500 in credit to shop at Thread, in order to be entered in the giveaway, the entrants must follow Thread on instagram and tag two of their friends in the comments of the post in the hope that they will also enter the giveaway. This will not only build social media following but also increase brand awareness and traffic by word of mouth promotion. The giveaway with run via Instagram but it will also be promoted via the other social media platforms, the bi-monthly email and the website. Thread will also run giveaways in year 2 and 3 to keep engagement high between the brand and consumers and to keep building awareness of Thread.
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7 60
fig.31
financial objectives [1] To ensure a profit is made by the end of year one. [2] To see growth of sales increasing by at least 5% every quarter.
funding The funds raised with secure the business at the beginning before it starts making a profit. It will also be the funding that covers the start up cost of the business that has been broken down in detail. Funding will be raised from both a loan and crowdfunding. A NatWest Small Business Loan of £50,000 will make up the bulk of the funding needed. NatWest have created small business loans to help them prosper. Their Small Business Loan has been created for businesses with an annual turnover of up to £2m. Businesses are able to borrow between £1000 £50,000 depending on their needs. Repayments are made every month with a fixed rate of interest. A long side this, £5,000 will be gained from crowdfunding. Crowdfunding is a way of sourcing income for the project from the contribution of a large number of people, in return for a benefit. The business concept shall be crowdfunding through the site I AM LA MODE, which is an international site that was made especially for designers and fashion projects.
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start up costs These are the costs that are required to start the business concept, accounting for the all expenses during year one, including the first six months of building the business then the final 6 months after the launch where the brand will be trading. This expenses include website development, the cost of 6 months worth of stock and the marketing budget for that year.
PRICE PREMISES
PEOPLE INSURANCE WEBSITE
Storage Space Utilities
Legal Advisor QuickBooks
Malting’s Business Insurance Website Development Domain registration
MARKETING EQUIPMENT
Business Email (includes Microsoft office) 1 year marketing budget
STOCK
£1,391
£15/mo
1
12
£145
£50/mo
£145 per hour £177.29 £2000 £77
£6.99/mo
Laptop
£359.99
Computer Software (Adobe) SHIPPING
52
£25/mo
Printer Ink
Stationary (pens, notebooks etc.) Packaging (white postal boxes)
6 months worth of stock
TOTAL
£26.75 per week
Wi-Fi
Printer
QUANTITY
£24.99 £28.45
£59/mo £10/mo
£387.50 £41,344
12 1 1 1
12 1
12 1 2 2
12 12 1 1
TOTAL
£600 £180
£177.29 £2000 £77
£83.88 £5000 £300
£24.99 £56.90
£719.98 £708 £120
£387.50 £41,344
£53,315.54 fig. 32 start up costings
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marketing budget The marketing budget has been set at approximately 10% of the sales, “marketing experts counsel a range between 1 percent and 10 percent, and even more depending on how long you’ve been in business, competitive activity and what you can afford” (Boykin, 2017). As Thread in entering a competitive fashion market as a new business, the marketing budget for the first two years has been based on 10% of the estimated sales in order to drive revenue and increase brand awareness. The cost of the marketing budget for year one has been covered in the start up costs and accounts for all marketing activities during pre-launch, launch and after launch. There is also a small £500 contingency for any additional costs through out the year.
YEAR ONE DIGITAL STRATEGY
£2600
£5200
£5200
Facebook promoted posts
£400
£500
£1000
Email Newsletter
Website Maintenance Giveaways Rent
Fittings OTHER
SALARIES
YEAR THREE
Instagram Influencers Instagram promoted posts
POP UP STORE
YEAR TWO
Staff
Promotion
Press Releases Photoshoots
Market Research PR intern
Social Media intern Digital Marketing Executive TOTAL
£400 £240 £150 £500 -
free
£250 -
free free -
£4,540
£500 £240 £200 £200
£1050 £200
£1260 £200 free
£100 £500 free -
£16,000
£26,150
£1000 £240 £500 £500 -
free
£250
£1000 free -
£16,00
£25,690 fig.33 marketing budget
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profit and loss fig.34 profit and loss
TOTAL INCOME REVENUE
Initial Investment Sales
TOTAL COSTS OVERHEADS
Start up Costs
Manufacturing Stock Packaging Rent
Marketing Budget Salaries NET INCOME PROFIT AFTER TAX
Loan Repayment
YEAR ONE
YEAR TWO
YEAR THREE
£116,632
£246,528
£493,056
£55,000
-
-
£89,840
£234,603
£401,566
£55,000
-
-
£1800
£1800
£61,632
£16,000 £18,840
£246,528
£165,376 £1,587
£27,000 £20,000
£493,056
£330,752 £3,174
£27,000 £20,000
£26,792
£18,840
£40,717
£18,840
£21,433
£32,573
£105,765
£132,207
The table shows the profit and loss estimated from the business in its first three years. (A full breakdown of costing including how sales were predicted and pricing justification can be found in appendix)
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measuring the success Objective
Measurement
Business Objectives [1] To be an innovator and market leader within the slow fashion market within the next three years. [2] To increase annual sales year on year by 50% [3] To plan and implement a pop up store by the end of year 2 to increase brand loyalty and increase sales in year two.
- To monitor new market entrants into the slow fashion market, and ensure that the brand successful reacts to new entrants and trends within the market to ensure competitive edge and to keep the brand a market leader. -Monitor sales performance to ensure that sales are increasing by 50% every year. -Brand loyalty will be measured by looking at repeat customers specifically in year 2 and 3 to see whether customers are being loyal and purchasing multiple items from the brand. -Monitor sales during the months before and during the pop up store in order to see whether there has been an increase within these months.
Marketing Objectives [1] To launch Thread by the end of November 2018 in order to achieve optimum sales around the Christmas period. [2] To increase threads brand awareness through social media following, PR reach and word of mouth. [3] To establish Thread as a recognisable and desirable brand for its target audience in order to achieve a profit of ÂŁ150,000 at the end of year three.
-To achieve a successful launch of marketing activities measured through initial demand for products. -Monitor Threads social media growth to ensure significant growth is achieved. -Observe media publications online and offline through out the year and send out press releases to relevant publications to ensure Thread are being promoted via PR. -Closely monitor sales to ensure that they are hitting targets and that stock is being sold.
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Communication Objectives [1] To successful penetrate the UK fashion market, by generating brand awareness of Thread amongst its core target demographic of millennial’s to see a 20% increase of sales per year. [2] To increase the social media following on the Instagram platform by 50% each year. [3] To focus on engaging customers through email marketing, acquiring at least 5,000 new subscribers to the monthly email per year. [4] To see website traffic increase by 10% month by month.
-Brand awareness will be measured by monitoring website traffic to ensure that the traffic is increasing by at least 10% each month. -The engagement rate across all social media platforms will be tracked, this includes growth of followers, likes and comments. -Monitor the success of the monthly emails by tracking number of subscribes to ensure this is increasing. -Monitor sales figures to ensure targets are being met. -Thread will monitor the success of instagram influencers using the unique discount codes given to them to see which has driven the most sales.
Financial Objectives [1] To ensure a profit is made by the end of year one. [2] To see growth of sales increasing by at least 5% every quarter.
-To closely monitors revenue in and outgoing in order to ensure profit is made by the end of year one no matter how big. -Monitor sales of products every quarter to ensure that sales are increasing. If the growth of sales is weak then marketing plan for the next quarter may have to be tweaked to ensure consistent growth. fig.35 measuring success
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fig.36
risk assessment
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RISK
LEVEL OF RISK
ACTION
Operating as an ecommerce Low only business
Operating as an ecommerce business could alienate customers who favour being able to touch and try on clothing before purchasing. To overcome this Thread must ensure an easy and quick customer experience, and offer a simple and quick returns policy to overcome customers fear.
Unpredictable cash flow and Medium misjudgement of sales forecast
In a tough economic climate it is hard to predict what could happen in the future that could stop the growth of sales. A strong marketing and communications plan will increase brand awareness, which should in turn create sales. Cash flows are based on estimation so will be revisited once trading has started to more accurately estimate forecasts.
Negative feedback surrounding Low the brand and its products
Thread will ensure that it sources the best UK supplier possible, so the brand is confident it offers products of the highest quality. If any negative feedback or reviews are received, Thread will ensure that the customer receives the best customer service possible to resolve the issue. Thread will use its social media platforms to gage customer satisfaction to try and minimise bad publicity.
Competitors operating a strong Medium market position
In order to overcome this issue, it is vital that the branding effectively portrays the correct brand message/essence and Threads USP in order to give them a competitive edge.
Staffing can’t keep up with daily Low demand.
The marketing plan has taken into consideration staffing the business, and plans to employ a digital marketing executive. The CEO will monitor the day-to-day business agenda to see if the employed staff are struggling to keep up with affairs and demand. If so, an intern will be hired to help.
Failure of, or cyber attack of Low website and data
To mitigate this Thread will use high quality servers that secure and encrypt data to keep the business safe. fig.37 risk assessment
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fig.38
8
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the future The outlook for the future of Thread is promising; as the brands success within the slow fashion market grows they will need to scope out future opportunities to keep the business growing. Focuses for the future of the brand include: -Expanding into menswear market, by creating a capsule collection for men that perfects the basic similarly to the womenswear collection. This will require market research in order to estimate demand and understand the competitive landscape for this expansion, however, targeting a brand new audience will open up the opportunity for more sales and larger profits. -To potentially open up retail stores. If the pop up store is successful, it could benefit Thread to open a store permanently. This would open up the opportunity for Thread to establish itself as a new name on the high street, it would also increase brand awareness, increase market share and help grow its customer base.
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conclusion Despite the risk of launching a new business concept, this report has demonstrated the feasibility of Thread to be a commercially viable venture, offering something new to consumers that are frustrated with what the fast fashion industry has to offer. As the slow fashion trend continues to grow this means that more competitors are predicted to enter the marketplace, which is where Threads point of difference will enable them to have a competitive edge and ensure growth does not stop. The marketing and communications strategy outlines how Thread will grow into a leading brand within the slow fashion market encouraging people to buy less but buy better, and will inevitably drive success and growth at Thread.
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references Academic.mintel.com. (2017). Clothing Retailing UK - Frequency of Buying Clothes. [online] Available at: http://academic.mintel.com/display/861587/?highlight [Accessed 14 Mar. 2018]. Academic.mintel.com. (2017). Fashion Online - UK. [online] Available at: http://academic.mintel.com/ display/839743/?highlight#hit1 [Accessed 14 Mar. 2018]. Academic.mintel.com. (2017). Fashion Online - UK - June 2017. [online] Available at: http://academic. mintel.com/display/839739/ [Accessed 16 Apr. 2018]. Armstrong, A. (2018). What will 2018 have in store for the retail sector?. [online] The Telegraph. Available at: https://www.telegraph.co.uk/business/2018/01/02/will-2018-have-store-retail-sector/ [Accessed 6 Mar. 2018]. Boumphrey, S. (2016). The New Consumerism: Redefining Ownership, Values and Priorities. [online] Euromonitor International Blog. Available at: https://blog.euromonitor.com/2016/04/the-new-consumerism-redefining-ownership-values-and-priorities.html [Accessed 30 Mar. 2018]. Bowker, J. (2014). Logo design- 5 reasons why simple logos are better for business.. [online] GORILLA. Available at: https://gorillastudio.co.uk/branding/logo-design-why-simple-logos-are-better/ [Accessed 27 Apr. 2018]. Cline, E. (2016). The Power of Buying Less by Buying Better. [online] The Atlantic. Available at: https://www.theatlantic.com/business/archive/2016/02/buying-less-by-buying-better/462639/ [Accessed 3 Apr. 2018]. Constine, J. (2018). Facebook survives Q4 despite slowest daily user growth ever. [online] TechCrunch. Available at: https://techcrunch.com/2018/01/31/facebook-q4-2017-earnings/ [Accessed 17 Apr. 2018]. Dickson, M., Grover, C. and Cataldi, C. (2016). The Slow Fashion Movement. [online] Notjustalabel. com. Available at: https://www.notjustalabel.com/editorial/slow-fashion-movement [Accessed 30 Mar. 2018]. Euromonitor International Blog. (2017). Faster Shopping: A Top Consumer Trend for 2017. [online] Available at: https://blog.euromonitor.com/2017/07/faster-shopping-top-consumer-trend-2017.html [Accessed 16 Apr. 2018]. Emarketer.com. (2017). UK Retail and Ecommerce: eMarketer’s Updated Estimates and Forecast for 2016–2021 - eMarketer. [online] Available at: https://www.emarketer.com/Report/UK-Retail-Ecommerce-eMarketers-Updated-Estimates-Forecast-20162021/2002188 [Accessed 6 Mar. 2018]. Gilbert, S. (2018). The Ultimate Guide to Instagram Influencer Marketing. [online] Later Blog. Available at: https://later.com/blog/instagram-influencer-marketing/ [Accessed 17 Apr. 2018]. Goldman Sachs. (2018). Millennials Infographic. [online] Available at: http://www.goldmansachs.com/ our-thinking/pages/millennials/ [Accessed 30 Mar. 2018]. influence.co Perspective. (2017). The Rise of Social Influencers: A New Age of Digital Marketing. [online] Available at: http://blog.influence.co/rise-of-social-influencers/ [Accessed 30 Mar. 2018].
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Perry, P. (2018). The environmental costs of fast fashion. [online] The Independent. Available at: https://www.independent.co.uk/life-style/fashion/environment-costs-fast-fashion-pollution-waste-sustainability-a8139386.html [Accessed 19 Mar. 2018]. Posner, H. (2011). Marketing Fashion. London: Laurence King Publishing. Retaildive.com. (2017). Mobile Commerce. [online] Available at: https://www.retaildive.com/ex/ mobilecommercedaily/mobile-preferred-over-print-magazines-forfashion-inspiration-sales-report [Accessed 14 Mar. 2018]. Retaileconomics.co.uk. (2017). What does Brexit mean for the economy and the UK retail industry? | Retail Economics. [online] Available at: https://www.retaileconomics.co.uk/brexit/what-does-brexitmean-for-UK-retail [Accessed 6 Mar. 2018]. Sharma, N. (2017). Fashion with a conscience: Why sustainable fashion is the next retail frontier. [online] https://www.wgsn.com/blogs. Available at: https://www.wgsn.com/blogs/fashion-with-conscience-why-sustainable-fashion-is-the-next-retail-frontier/# [Accessed 30 Mar. 2018]. Statista. (2017). Instagram daily active users 2017 | Statistic. [online] Available at: https://www.statista.com/statistics/657823/number-of-daily-active-instagram-users/ [Accessed 14 Mar. 2018]. The Business of Fashion (2017). The State of Fashion 2018. The State of Fashion. [online] The Business of Fashion. Available at: https://cdn.businessoffashion.com/reports/The_State_of_Fashion_2018_v2.pdf [Accessed 8 Apr. 2018]. The World Cities in 2016. (2016). The World Cities. [online] United Nations. Available at: http://www. un.org/en/development/desa/population/publications/pdf/urbanization/the_worlds_cities_in_2016_ data_booklet.pdf [Accessed 31 Mar. 2018]. Webkick. (2017). Why ecommerce is growing | digital marketing Andover. [online] Available at: https:// www.webkick.co.uk/why-ecommerce-is-growing/ [Accessed 24 Apr. 2018]. WGSN. (2016). Email Marketing to Millennials. [online] Available at: https://www-wgsn-com.ntu.idm. oclc.org/content/board_viewer/#/65368/page/1 [Accessed 17 Apr. 2018]. Wheeler, A. (2018). Designing Brand Identity. 5th ed. New Jersey: John Wiley & Sons. WRAP (2017). Valuing our clothes: The cost of UK fashion. [online] WRAP. Available at: http://www. wrap.org.uk/sites/files/wrap/valuing-our-clothes-the-cost-of-uk-fashion_WRAP.pdf#page=8 [Accessed 11 Apr. 2018]. Wrap.org.uk. (2018). Clothing | WRAP UK. [online] Available at: http://www.wrap.org.uk/content/clothing-waste-prevention [Accessed 19 Mar. 2018].
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illustrations fig.1 http://thechicstreetjournal.com/photos/ fig.2 How much of your whole wardrobe would you say you have worn in the past 6 months? fig.3 what is the main reason you stop wearing/dispose of your clothing? fig.4 http://death-by-elocution.tumblr.com/post/154406632655 fig.5 consumer spending on clothing fig.6 https://www.notjustalabel.com/editorial/slow-fashion-movement fig.7 https://www.pinterest.co.uk/pin/498914464963692730/ fig.8 http://stylecaster.com/minimalist-fashion-outfits/ fig.9 https://www.coxandcox.co.uk/industrial-iron-clothes-rail-black fig.10 concept testing fig.11 would you be more inclined to buy from a brand if you knew their products were designed to last longer? fig.12 http://www.designhunter.co.uk/home/2016/3/24/weekend-style-my-5-minimal-monochrome-wardrobe-essentials fig.13 brand positioning map fig.14 competitor analysis fig.15 the minimalist pen portrait fig.16 the workaholic pen portrait fig.17 the conscious consumer pen portrait fig.18 thread logo design fig.19 brand essence model fig.20 range plan examples fig.21 desktop website mock up fig.22 business model fig.23 http://www.ouurmedia.com/projects/ouur-spring-summer-15 fig.24 http://www.ouurmedia.com/projects/ouur-spring-summer-15
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fig. 25 marketing plan strategy timeline fig.26 digital and social media platforms fig.27 instagram mock up fig.28 www.instagram.com/matildatheminimalist fig.29 www.instagram.com/brittanybathgate fig.30 https://stormfashion.dk/product/magazines/no-17-the-gentlewoman fig.31 http://www.thefashionmedley.com/tag/minimal-fashion/ fig.32 start up costing’s fig.33 marketing budget fig.34 profit and loss fig.35 measuring success fig.36 http://www.temporaryhousewifey.com/temporaryhousewifey/2015/10/1/everlane-sweater-andsilk-review-2-the-sweater-tee-and-the-modern-silk-point fig.37 risk assessment fig.38 https://www.pinterest.com/melaniesaj06/flat-lay-photography/
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appendix 2 FOCUS GROUP QUESTIONS AND ANSWERS DATE: 20/03/18 INTERVIEWER: First of all I would just like to say thank you for taking part in this focus group. The focus group will be taped and transcribed, and should you want a copy of the transcription then please ask me and I will arrange for one to be sent to you. The information you give me will be used in support of my work and will be written up in my project. Anything you say will be treated with the strictest confidence and your contribution to the discussion will not be attributed to you as an individual, what you said will be used for illustration only; to reinforce a point that I am making. My first question I would like to ask is pretty general, how do you feel about your wardrobes? Do you love your collection of clothes? Participant 1: I’m at the stage where I’m starting to hate everything I own, I just don’t feel inspired my most of my clothing, its all old seasons or cheap stuff that I just don’t feel like wearing anymore because they’ve started to go a bit tatty. I’d say my wardrobe definitely needs a bit of an update. Participant 2: Yeah id say the same really. I have a few good pieces that I feel like ill probably own and wear for a long time but the rest is just a bit ‘meh’ if you know what I mean. Participant 3: I’m the opposite actually, I’m quite happy with what I own but it’s took me a while to get there. When I was younger I use to be in places like Topshop or Primark every weekend buying something new, but id wear it for a month then kick myself for wasting the money. Since starting work, I don’t have a uniform but I have to look professional and presentable so that’s when I started investing a bit more in clothing because I knew they needed to serve a purpose for me. Participant 4: I think I go through stages of loving it and hating it, it depends on when the last time I went shopping was. I get bored of clothes so easy.
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Participant 5: Yeah I think I’m quite happy with mine too, it’s missing a few bits that id like to add into it but at this stage I don’t tend to go shopping much. I feel too old now to be going to the high street. Interviewer: What’s the main reason you stop wearing items of clothing you once loved? Participant 2: I think its my own fault really, I buy clothes that are ‘trendy’ at the time, then a couple of month later ill stop wearing it because everyone else has too. Other than that, its just quality. But again, that’s my own fault because I know a £10 top from Primark isn’t going to last me a year is it. Participant 1: Yeah id say I’m the same, the only item of clothing I really pay money for is jeans which I don’t mind doing because a pair of black skinny jeans are going to be needed all year round. The other bits I stop wearing because I get bored of them and they start to look gross after a while and I get embarrassed wearing them. Participant 3: I mean its been a while for me since I got rid of an item of clothing, now the majority of my clothing id been heartbroken if I had to get rid of any of it. The last time I had a wardrobe clear out though was because I had so much stuff I just didn’t wear anymore, I think it was because my style had changed and I had so many trend pieces that just didn’t feel like me anymore. I did donate them to charity though; I didn’t just chuck them in the bin. Participant 4: Mine is because I’m bored of them. I’m such a trend buyer, I love buying into the new trends but in a few months time I just cant bring myself to wear them. Interviewer: What items do you find yourself always wearing? Participant 3: Even though I don’t have a uniform for work, I give myself one. I live in my black jeans, I have many pairs all different styles, tops I change it up a lot so I don’t have any specific one I love the most but I have two jackets that I live in. My leather jacket and a black longline boyfriend style jacket are my saviours. Participant 2: I live in the same outfit most of the time, I like to be comfy so I go for a skirt, normally denim, and a black jumper. Its my perfect outfit and I probably wear it twice a week, I don’t mind repeating outfits. Participant 1: Jeans. I love jeans. They’re the best and are perfect for everything. Participant 5: I just live in jeans and a jumper. I just try to look as put together as possible. Nothing fancy, just anything simple but stylish id say. Participant 4: A lot of the time I’m mixing up what I wear, but at the minute seeing as though the weather is horrible jeans and a wool coat keep me warm. Interviewer: Would you consider paying a little extra for these items if you knew they’d last you a long time? Participant 1: 100% yeah if I knew that they would actually last me years because sometimes even when you pay more for something its still awful quality and after a few washes the colour has faded terribly. Participant 3: That’s what I’ve started doing in the past year, Id rather have less clothes but love every item. Quality has become my priority. Participant 2: Yes definitely, I’m starting to get tired of crap clothing. I needed something better. Participant 4: I think it depends on the price, because I’ve looked at getting a luxury version but I just can’t justify hundreds of pounds on one item. Some brands charge a crazy amount. 86
Participant 5: Yeah id say I do that now. But a lot of the time they promise its good quality but it still ends up being ruined after a few washes. Interviewer: What sort of price would you pay? So think of the items you just mentioned and think of a price for them. Participant 2: Well I live in my black jumper and if a brand could promise that it wouldn’t go bobbly after a few months id say around £50, maybe £60. Participant 5: Yeah I live in jumpers and id say around the same price actually. Participant 3: I said leather jacket and I did end up paying quite a bit for that one, but leather does cost a lot. I think I paid around 250£ for mine, it was a lot but I knew id get my wear out of it. Participant 4: I would like a new wool coat, and I paid £60 for mine I think and I would pay more now I know how much wear id get out of it. £100-£150, nothing more than that. Participant 1: Jeans are my favourite; I wouldn’t ever pay any more than what levis charge. I think they have their pricing just right. Interviewer: So I’ve come up with a business concept, it’s a womenswear brand that offers quality basics and wardrobe essentials at what I like to call a friendly price. If you want something that’s high quality and will sit in your wardrobe for years, you’d come to this brand. What are your initial thoughts, would you purchase from this brand? Participant 3: If I could 100% trust this brand and its promises then yes I would definitely purchase from them. Depending on their offerings, I would love to have another brand to browse when I’m on the look for something new. Participant 2: As long as they were reasonable priced yes id buy from them. Also id still want to clothes to be stylish, basics can sometimes be boring and a bit old fashioned so id still want them to be young. Participant 1: I agree with everything that’s been said, I think id need to trust the brand before I made a purchase. Id need to be confident that its not just another brand. Participant 4: It sounds good yeah. Id like to see what sort of items it would sell and how young they look because I know brands that keep it simple can sometimes look a bit old fashioned. Participant 5: Yeah this sounds like something right up my street. I think it would really suit me. Interviewer: So you’ve mentioned trust, how brands get you to trust them? Participant 1: For me I like to see other people buying and testing out the product first. If someone I have on instagram or YouTube recommends a brand I’m more entitled to trust their opinion, as long as I don’t think they’re lying for the money. Participant 2: Yeah I’m the same really, if someone recommends it to me I’m more likely to purchase from them because id like to think someone wouldn’t recommend something terrible to me. Participant 3: I just like brands to be honest. Its when they start to hide stuff I think something’s not right. I want to know everything, where it was made, what it’s made off and what makes it going to last me. And if they are giving people clothes to review I want it to be because they love it not because the money has influenced them. Participant 5: I think I’m a bit old fashioned, the brands I trust the most are the ones my friends have recommended to me. I trust them so if they like something and say its good, it must be. 87
Participant 4: If its had good reviews online then I’m more willing to buy into what they’re selling. I love it when individual products have their own reviews on the website as well, I like knowing what other people think because they’re normally very honest. Interviewer: My business concept would also initially release a capsule collection made up of around 12-15 items, so they’re wouldn’t be 100’s of items for you to shop to encourage people to buy less but better, how do feel about this? Participant 3: I’m quite passionate about doing this and its something that everyone should do. Id also like brands to value this more, I understand they have to make money but this fast fashion life we live is not healthy for anyone. I’m happy buying less because in the long run its makes getting dressed so much easier and saves you so much money. Also a clothing shop doesn’t need the 100’s of items it sells anyway so id be fine with that. Participant 2: Id like to find a balance, I want to invest in quality pieces that would build a capsule wardrobe but id still end up buying something new from a fast fashion brand every now and then. But if a smaller wardrobe didn’t stop me from feeling stylish I would be happy with that. A brand that has less choice will only appeal to me if I do like what they offer. Participant 1: I think in the long run it would be more cost effective and my wardrobe would be full of clutter that just sits there unworn. Also if I knew something was going to last me as long as it says, id feel less guilty about spending the money on it. A brand with less choice will probably stop be from getting so overwhelmed, brands don’t need all they offer anyway so I don’t think id miss it as long as they still had what I wanted. Participant 4: As a trend lover this makes me a bit unsure. I do understand that fashion is bad for the environment but if they had something I liked id feel better knowing I’m buying from a brand that has good morals and are trying to make a change. Participant 5: Having less choice doesn’t bother me really; I don’t think you can go wrong with the basics. And if a brand has less choice it would make me think that they’ve spent more time on the products that they do sell. Interviewer: Can you think of any other brands that are similar to this concept? Participant 3: The only brand id say is slightly similar is All Saints, however, they are very expensive and I don’t think they appeal to everyone. But id say they sell high quality basics but I don’t think they’re for the everyday woman. Participant 2: I can’t really think of anyone. I know most brands offer basics but I cant think of anyone that’s a specialist in this. Participant 4: Erm a lot of brands do sell basics but theyre mixed in with the other hundred products they sell so sometimes it hard to find them. I know Zara do good basics, but they are cheap and wouldn’t last you longer than a season. Participant 1: Yeah so many high street shops have basics but they’re normally cheap and they don’t promote them as quality. I think the high street does lack a concept like this. Participant 5: I couldn’t tell you a fashion brand that only sold 12-15 items no Interviewer: I’m going to show you a few logo ideas I have so far. Ive tried to keep them simple to reflect the brand, all id like to know is which one you prefer and why? Participant 4: Number 2 is my favourite; I think the font is easier to read than the others. Participant 5: I agree number 2, the font is better and I don’t know why I just like the full stop at the end. 88
Participant 1: I’d say number 1, I agree it’s the better font but I like its simplicity without the full stop I think. Participant 2: No I agree with (participant 5) I love the full stop I don’t know why it just makes it more than just a name. Participant 3: Yeah I agree, the full stop makes it different in a simple way. Interviewer: That’s everything then guys, thank you so much for taking time to help me with this. Your feedback has been very helpful
appendix 3 EXPERT INTERVIEW Jessica Shelton – Digital Marketing Co-ordinator Via email on 02.04.18 02/04/18 at 10:15am Hi Jessica, Is it okay if a ask you a few questions in relation to digital marketing that will help me with my final project at university? I’m creating my own fashion brand and need to create a marketing and communications plan that will help successful promote my brand. Many thanks, Abbie 02/04/18 at 12:18pm Hi Abbie, Yes of course would love to help, send them me over and ill answer them for you. Jessica 02/04/18 at 12:25pm Hi Jessica, Its just a few quick questions, nothing that will take too long. 1) How relevant would you say instagram influencers are in terms of using them as a marketing tool, and how much would one post cost from a instagrammer with around 100k followers? 2) For a start up company, would you favour digital marketing over print based? 3) Do you have any general tips to give me for marketing a new brand? Thank you for your help. Abbie 02/04/18 at 2:31pm Hi Abbie, I hope my answers help. 1) I would say instagram influencers are very relevant, especially for you if it’s a fashion brand you are starting. People are easy influenced by things they see on social media, social media platform are the most influential in my eyes so id say consider using a multitude of platforms to effectively portray your message and connect with your audience. In terms of payment, it does vary but id budget around £650 per post for someone with followers between 100k-200k. 2) Even though I work in digital marketing I still think that traditional marketing platforms are still effective depending on who you’re targeting and what you’re selling. For example, a magazine feature would still be a highly effective marketing tool if you can get it. But for start up digital marketing is important because it’s more cost effective. Setting up an instagram page is free and if you have any spare money in your budget you can promote posts for extra exposure. Finding the perfect balance 89
between the two is beneficial but always remember your budget as a start up and you’re very limited with funds. 3) In terms of general tips I would just say always remember why youre using marketing platform. If you don’t have a specific reason why or a specific audience your targeting with it id say you probably don’t need it. Only use the platforms that are going to be beneficial to you. I hope this helps, if you have any other questions please feel free to email me again. Kind regards, Jessica. 02/04/18 at 2:46pm Hi Jessica, Thank you so much for your help, it will all be very beneficial to me. I have to ask for your permission if I can use this interview is my report and if im able to reference it at points? Many thanks, Abbie 02/04/18 at 3:27pm Hi Abbie, Yes of course you can. Please let me know how it all goes. Kind Regards, Jessica
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appendix 4
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appendix 5 PESTLE Political There are a wide range of political factors that are affecting the current retail/fashion market and it’s trading, however, the most recent factor is the results of the EU referendum. Leaving the EU will undoubtedly have a significant effect on UK businesses and businesses wanting to trade in the EU. Established retailers and new brands wanting to enter the market should be prepared for a decline in the sterling, rising cost of credit, possible disruptions in trade credit insurance (especially for midmarket retailers) and they should expect weaker consumer and business confidence (retaileconomics. co.uk, 2017). This also means that goods purchased overseas will be more expensive, for retailers it could mean that have to start looking at purchasing materials and other items closer to home. Economical “2017 brought the return of inflation to the retail sector as cost pressures from a weakened pound worked their way into rising shop prices. At the same time, wage growth started to stall, provoking fresh fears about the spending power of the British consumer.” (Armstrong, 2018) Economical uncertainty is shaking up the high street; this along with the shift to ecommerce has had a huge effect on brick and mortar stores. While this increase in online sales is keeping the retail industry afloat, it has had negative effects on the high street with stores closing or companies decreasing the amount of stores they have. The number of shops across the UK is expected to fall by 22pc from 281,930 to 220,000 in 2018, according to forecasts by the Centre for Retail Research. It also predicts that a further 164 major or medium-sized companies will fall into administration, involving the loss of 22,600 stores and 140,000 jobs. Last year 42 retailers failed. (Armstrong, 2018) For fashion retailers it has been especially tough for them, with spending online accelerating, ecommerce brands such as Missguided, ASOS and Boohoo have hovered up shoppers with what they offer. eMarketer (2017) estimates UK retail mobile commerce sales will rise by 14.2% between 2017 and 2021, when purchases made online via mobile devices will make up well over one-tenth (13.4%) of total retail sales. The way in which consumers are spending their money is changing and brands that don’t take this into consideration will ultimately fall into the pile of companies that fail due to not adapting to the changing market. Social There is a growing concern amongst UK consumers around sustainability, especially regarding fast fashion brands. Facilitated by social media, consumers have become more vocal regarding sustainable issues, making it imperative for retailers to offer visibility over their material procurement and apparel production practices. The growth in sustainable fashion has seen high-street retailers launch dedicated sustainable collections, such as H&M’s conscious collection. Retailers must be transparent with their ethics, especially in regards to their sustainability. The rise of social media influencers is creating a new age of digital marketing. “Seventy percent of consumers trust brand recommendations from friends, but only ten percent trust advertising” (influence. co Perspective, 2017). This means if a consumer was to see your ad they probably still wouldn’t trust it. Influencers online have built loyal followings, some even have millions that want to know what they’re buying and trust what they say. From a brand perspective, Social Influencers can have a wide-ranging impact on awareness, appeal, and dedication coming from their audience. With traditional sales tactics dying, social media influencers are becoming increasingly important in a brands marketing strategy. Technological Advances in technology means that consumers are now able to shop via their phone easier than ever. “Smartphones have overtaken tablets to become the most popular mobile device for online fashion purchases, with almost half (48%) of Millennial’s having bought fashion from their smartphone.” (Academic.Mintel.com, 2017) This means that retailers must continually invest in their mobile sites to give consumers an excellent customer experience and the latest technological advances to keep up with competitors. 93
As consumer’s obsession with mobile grows, the end-to-end transaction will also move to mobile. With an overabundance of mobile payment solutions already available globally, consumers will expect fashion companies to cater for increasingly convenient mobile transactions. Fashion brands will also begin to realise the opportunities that this can bring for them. Consumers turn to their mobile phones for research, covering everything from inspiration to price comparison, Retaildive (2017) states that millennial’s are now spending an average of six hours per week on researching fashion on their phones. And since consumers do most of their shopping research on social media, these platforms are developing features that make it easier for users to shop and pay. Pinterest has long had a buyable pin option that allows users to make purchases without leaving the site; and Instagram is currently partnering with BigCommerce and Shopify to build m-commerce capabilities. “As of September 2017, Instagram had reached 500 million daily active users, up from 150 million in January 2017. The app is one of the most popular social networks worldwide. In April 2017, Instagram announced 700 million monthly active users. Instagram is not only a popular photo editing and sharing app but also a popular marketing channel for brands, especially in the beauty, fashion, and luxury segment.” (Statista, 2017) With such a large audience, Instagram has become a huge platform for fashion brands to get involved with and to advertise and reach new audiences. On March 20th Instagram cemented itself as a direct to consumer ecommerce brand with the launch of shopping here in the UK, an update on the app allows consumers to seamlessly purchase products from their favourite brands and can directly shop what their favourite influencers are wearing. This creates a huge opportunity for retailers that use the app to enhance their consumer’s digital experience and to instantly boost their sales. Consumers are now starting to see an omni-channel experience as a given. Legal In April the government issued changes in the national living wage, increasing it marginally. Business costs will incrementally rise due to the implementation of higher wages. This could accredit to a threat to businesses due to smaller profit margins if prices and profits do not rise with the increasing costs. On the other hand, this may increase consumer’s confidence in spending for a proportion of the population is their disposable income increases. The modern slavery act is a law that aims to tackle modern day slavery that is still seen within the business landscape. The awareness around this topic is increasing meaning brands must be honest and transparent with their corporate social responsibility in order to comply with the act. Environmental “Fast fashion focuses on speed and low costs in order to deliver frequent new collections inspired by catwalk looks or celebrity styles. But it is particularly bad for the environment, as pressure to reduce cost and the time it takes to get a product from design to shop floor means that environmental corners are more likely to be cut. Criticisms of fast fashion include its negative environmental impact, water pollution, the use of toxic chemicals and increasing levels of textile waste.” (Perry, 2018) Vibrant colours, prints and fabric finishes are appealing finishes to fashion garments and can be seen all year round and many of these finishes are achieved by using harmful, toxic chemicals. Textile dyeing is the second largest polluter of clean water globally, after agriculture. Greenpeace’s recent Detox campaign has been instrumental in pressuring fashion brands to take action to remove toxic chemicals from their supply chains, after it tested a number of brands’ products and confirmed the presence of hazardous chemicals. Similarly, “the value of unused clothing in wardrobes has been estimated at around £30 billion. It is also estimated £140 million worth of clothing goes into landfill each year” (wrap.org.uk, 2018). Textile waste is an unintended consequence of fast fashion, as more people buy more clothes and don’t keep them as long as they used to. The international expansion of fast fashion retailers exacerbates the problem on a global scale.Companies must ensure that they have an overall goal to reduce their environmental impact on the planet. This is due to the fact that consumers are becoming increasingly conscious about the future of the planet.
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appendix 6 ESTIMATED SALES REVENUE Below shows how the estimated sales revenue was calculated: Potential customer demand = size of the prize 17 million millennial’s in the UK 6.4 million female millennial’s (Brown, 2017) 2% of population trial rate based on likelihood of adoption = 128,000 Year one: 0.5% brand awareness = potential of 640 customers Year two: 1% brand awareness = potential of 1,280 customers Year three: 2% brand awareness = potential of 2,560 customers Number of customers x average sales price x number of yearly purchases = yearly projected sales (Kearns, 2017) PREDICTED YEARLY SALES Y1 640 x 96.30 x 1 = 61,632 Y2 1,280 x 96.30 x 2 = 246,528 Y3 2,560 x 96.30 x 2 = 493,056 PREDICTED YEARLY COSTING FOR STOCK Average cost price = 64.60 Y1 640 x 64.60 x 1 = 41,344 Y2 1,280 x 64.60 x 2 = 165,376 Y3 2,560 x 64.60 x 2 = 330,752
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appendix 7 STORAGE SPACE
MALTING BUSINESS INSURANCE
COST
£26.75 per week £177.29
Website development
£2000
All equipment
£1,929.87
Domain Registration Business email (including Office)
£77
£6.99mo
JUSTIFICATION
Quote gained from Big yellow self storage for a 50 sq ft storage box in Nottingham, that is alarmed and has CCTV.
Quote gained from compare the market.
Using a freelance designer found via Fiverr.
Initial domain registration cost using Godaddy.com Offer included with godaddy domain registration.
All costing found using secondary research, gaining quote from wifi companies and getting traditional costs of a printer ect.
Packaging
Dependant on year.
Instagram influencers
£650 per post
Quote gained from Jessica Shelton, Digital Marketing Co-ordinator at Vertical Health.
Pop up store Rent
£150 a day
Pop up staff
£1260
Average pricing per day for a retail space that would be suitable for thread, gained via ‘appearhere’ a site that specialised is renting retail space.
Photo shoot
Price dependant on year
Manufacturing of Stock
Email Newsletter
Digital Marketing Executive 96
Pricing varies depending on style
£20/mo
£16,000
Wholesale pricing gained from ukpackaging.com
Manufacturing costing of the stock was gained by contacting UK manufacturing companies and asking for quotes for the items in the range plan using high quality materials.
Priced gained from Mailchimp which is based on subscribers.
This costs comes from hiring 3 full time staff members working 9-6 for a week on national living wage. Cost includes price charged by ‘Naomi Williams’ a personal friends and photographer. Average wage for this job role in Nottingham, found via indeed jobs
Rent
£1800
Rent per year for year 1 and 2, this is a quote from an office space in the lace market, Nottingham.
Loan Repayment
£18,840
Based on the monthly repayment cost for a £25,000 loan from Natwest, which is £785 then doubled as thread will have a £50,000 loan from them.
RRP of range
depending of style
This took into consideration competitors pricing and between a 40-60% profit margin.
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appendix 8 STYLE
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FABRIC
COLOURS
SIZES
RRP
ACTUAL COST
QUANTITY
TOTAL COST
TOTAL RETAIL
MARGIN ACHEIVED
Leather jacket
100% leather
black
6-18
£310
£225
20
£4,500
£6,200
40.9%
Longline wool coat
100% wool
black
6-18
£350
£225
20
£4,500
£7,000
40%
Lightweight knit jumper
100& wool
black grey striped
6-18
£90
£60
90
£3,600
£8,100
50%
Long sleeve top
Polyester and viscose
black white grey
6-18
£35
£25
120
£3,000
£4,320
40%
Short sleeve t-shirt
Polyester and viscose
black white grey
6-18
£30
£20
120
£2,400
£3,600
50%
Black culotte trousers
100% polyester
black
6-18
£75
£50
90
£4,500
£6,750
50%
Straight leg jeans
100% cotton (denim)
black blue wash
6-18
£80
£50
90
£4,500
£7,200
60%
Black slip dress
100% polyester
black
6-18
£85
£55
90
£4,950
£7,650
54.4%
ACTUAL COST
TOTAL QUANTITY
TOTAL COST
TOTAL RETAIL
MARGIN AVERAGE
£710
£640
£31,950
£50,820
48.2%
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