WOMEN’S DENIM FALL 2016
CONTENTS Our Heritage (06-11) Scope & Size (12-15) Target Consumer (16-21) Our Competitors (22-25) SWOT Analysis (26-29) Our Strengths (30-33) Our Strategies (34-37) Collections & Collaborations (38-41) Current Trends (42-55) Lifestyles Trends (56-61) Six Month Buying Plans (62-69) Assortment Plan (70-73) Statement of Opportunity (74-77) 4
01 our Heritage WHO WE ARE Blue jeans are now an iconic staple in everyoneâ€™s wardrobe but itâ€™s Levi Strauss who made the first blue jean in 1873. Take a look at our heritage, our values, brand identity and brand mission, to see just how we began making those denim classics you wear and love.
OUR HERITAGE A glimpse at our journey going all the way back to 1853.
Levi Strauss and Co. was founded.
The denim blue jean is born.
1886 The horse logo is branded on to the jeans.
Levi Strauss passes away.
Headquarters are destroyed in a fire and earthquake.
Iconic red tab is introduced.
Levi Strauss Foundation is formed.
The Levi’s international division is created.
1983 Employees gain health services for HIV and AIDS.
1918 Levi’s produces their first garment for women.
Human Rights Foundation gives Levi’s a 100% for their LGBT8 treatment.
Levi’s begins initiative programs.
OUR VALUES AN IN DEPTH LOOK AT OUR FOUR CORE VALUES: EMPATHY, INTEGRITY, ORIGINALITY AND COURAGE.
EMPATHY WALKING IN OTHER PEOPLEâ€™S SHOES Empathy begins with paying close attention to the world around us. We listen and respond to the needs of our customers, employees and other stakeholders.
INTEGRITY DOING THE RIGHT THING Integrity means doing right by our employees, brands, company and society as a whole. Ethical conduct and social responsibility characterize our way of doing business.
ORIGINALITY BEING AUTHENTIC AND INNOVATIVE The pioneering spirit that started in 1873 with the very first pair of blue jeans still permeates all aspects of our business. Through innovative products and practices, we break the mold.
COURAGE STANDING UP FOR WHAT WE BELIEVE It takes courage to be great. Courage is the willingness to tell the truth and to challenge hierarchy, accepted practice and conventional wisdom. It means standing by our convictions and acting on our beliefs. 9
OUR IDENTITY A FEW WORDS DESCRIBING WHO WE ARE APART FROM THE OBVIOUS WORDS LIKE “EPIC”, “rad” AND “AWESOME”.
TRU ST E D ALL- AMERICAN CL ASSIC CO OL INN OVATI VE AU T H E N TI C
OUR MISSION OUR CORE MISSION BESIDES MAKING US YOUR GO-TO BRAND OF DENIM
TO CO N TI N UE TO R E INV E N T TH E B LUE JEAN
02 SCOPE & SIZE how big are we Since starting itâ€™s business in 1853, you can imagine how much Levi Strauss and Company has grown throughout the years. To evaluate our scope and size, we looked at things like our merchandising venues, our social media platforms and the variety of our products.
SCOPE & Size A BRIEF OVERVIEW ON THE SCOPE AND SIZE OF THE LEVI STRAUSS COMPANY
TAKING OVER THE WORLD LEVI STRAUSS IS A Global retailer. • With over 50,000 retail locations in over 110 countries, the Levi’s brand is well known. • In The United States alone, there are over 750 franchised or independently owned Levi’s retail spaces. • Aside from the United States, Levi’s merchandise can be found in countries such as New Zealand, Pakistan, Japan and Canada.
SOMETHING FOR EVERYONE LEVI STRAUSS HAS A WIDE VARIETY OF PRODUCTS. • Currently, Levi’s is developing products for women, men, kids and accessories. • Pioneering the denim industry, Levi’s provides customers with large range of styles, colors and washes to fit their lifestyle needs.
SOCIALLY SPEAKING LEVI STRAUSS IS ABLE TO CONNECT WITH THEIR CONSUMERS ON MULTIPLE PLATFORMS. • Levi’s social media presence consists of active profiles on Facebook, Tumblr, Pinterest, YouTube, Twitter, and Instagram
NUMBERS TALK LEVI STRAUSS IS EXPERIENCING CONSISTENT GROWTH. • Levi Strauss and Co. consists of Dockers, Denizen, Levi Strauss Signature Label, and the original red tab Levi’s Brand. • In 2014, Levi’s Company generated $4.8 billion dollars in revenue. •Our growth has been picking up modestly, increasing at 1% annually.
MERCHANDISING VENUES LEVI STRAUSS SELLS ITS PRODUCT THROUGH MULTIPLE CHANNELS. • Brick and Mortar • E-Commerce • Chain Retailers including Kohl’s, JC Penney’s, Macy’s, Nordstrom, Barney’s and Wal-mart.
03 Target consumer who we are after The demographics for our Leviâ€™s consumers are people who are innovators, thinkers, experiancers and strivers. Although we often have a younger demographic (ranging between 16-29), we have strong brand loyalty. Those young consumers grow with us. The Leviâ€™s customers is often upper to middle class with an income between 45k and 60k. Most importantly, nearly 75% of our business comes from men. This is why we want to focus on improving our womens wear department. 17
@MyBeardIsBetter Portland raised, 32, and newly married. Iâ€™m a junkie for adventure so if you like biking, hiking or even being outside, then I am your man. Check out my artwork coming soon to a gallery near you ;) PORTLAND, OREGON theartistexperiance.com
Road Trip to California means an endless supply of Tom Petty, Johnny Cash and Lynard Skynard
How did I even ride my bike before my @Levis Commuter Jeans?!? #522 #SlimTaperOnly
I like my coffee black and my food vegan #FishAreFriendsNotFood 18
@MadeInMillennial Founder of Lola & Lemon. 18. I’m a free-spirited, creative, selfmade fashion blogger. Don’t be a stranger and subscribe to my YouTube channel: LolaLovesLemons. SAN FRANCISCO, CALIFORNIA LolaandLemon.com
1.5 K FOLLOWERS
Friday nights in means catching up with Hunger, i-D and Dazed Magazines
When date night is at a coffee bar and you’re a barista... #MoreChaiLattesPlease
Sunrise strolls on the beach in my @Levis 501 CT’s listening to my fave mix #The1975 #Banks #MilkyChance 19
@KimiGetsDigi Hi, I’m Kimi! I’m a freelance graphic designer always thinking of new ways to bring life to visual content. I’m hardworking, outgoing, optimistic and imaginative. Oh and if you care I’m 26. TOKYO,JAPAN KimiDesignsDigi.com
@KimiGetsDigi TIP: Almond milk and 3 sugars is the only to drink coffee #VeryLateToClass
@KimiGetsDigi Jamming to Baby Metal and Miyavi while I customize my @Levis Wedgie Fit Jeans with patches #Inspo
8d @KimiGetsDigi Walking around Tokyo with my boyfriend today and I found an amazing vintage shop full of old biker jackets #Heaven
@DJSmooth Born and raised in New York.16. You’ve probably heard me DJ if you’re out on a Friday night. I’m bring authenticity back to music. Click the link if you’re looking experience something new. NEW YORK, NEW YORK soundcloud.com/smoothgroovesteve
@DJSmooth Working at my family’s record store today! Stop by if your looking for new music to vibe to #MusicIsForever
@DJSmooth Late night skate sesh thinking about my dreams with Mac DeMarco and King Krule pumping through my Beats
4d @DJSmooth Are dudes still wearing skinny jeans? The @Levis 541 Athletic Fit is where its at! #CanIGetAnAmen
04 our competitors who we are watching More and more retailers are entering the denim industry. Itâ€™s important to watch who else is doing denim well. From premium luxe denim to trendy styles and fits, hereâ€™s who we think we should be keeping an extra eye on.
OUR COMPETITORS JUST A QUICK PEEK AT OUR COMPETITION IN THE DENIM INDUSTRY
AEROPOSTLE COMPLETELY CASUAL Aeropostle target age demographic is between age14 to 40 which falls in line with Levi’s. Because the brand identity of Aero is very causal and youthful, they feature a wide selection of denim.
GAP Denim, denim, denim Gap is an all--American brand that is known for their denim and their stripe tees. They recently have launched their #NothingButDenim campaign with new fits and new fabrications.
VF CORPORATION Extremely ACCESSIBLE The VF Corporation is home to many big brand names like Lee, Wrangler and Vans all of which have popular denim collections. VF brands are available at most retailers like Nordstrom, Wal-mart and Journey’s.
ASOS TOTALLY TRENDY ASOS’ target is market is towards young adults who love on trend styles. Not only do they carry hundreds of brands and styles of jeans.
FARFETCH Premium Luxe Farfetch, much like Levi’s, is a global brand with merchandise in 400+ boutiques. They have a large variety of designer denim including Dolce & Gabbana denim and jeans from DSQUARED2.
MADEWELL “WE DO GREAT JEANS” Madewell prides it self on having great jeans and then have the perfect tees, jackets and shoes to go with them. They have also launched a denim recycling initiative with in their stores and they keep a focus on denim as a focus category for their brand.
05 SWOT ANALYSIS checking ourselves After examining our external competition, itâ€™s always good to take a look within so that we can remain the authentic brand we begin with. Our SWOT analysis examines our strengths, weaknesses, opportunities and threats, that we feel are most crucial to keeping Leviâ€™s progressive.
SWOT ANALYSIS A SNAP SHOT AT WHAT WE ARE DOING WELL AND WHAT WE COULD WORK ON
• Authentic • Strong brand recognition • Specialized in jeans • Multiple in-house brands • Innovation • Awareness • Internationally Known • Focus on the heritage of the brand
• 1% steady growth annually • Lack of womens wear merchandise until recently • No mobile app
• Further innovation • Casual wear market • Womens market • Partner up with higher end designer for exclusive collaborations • New Styling Direction
• Increasing competition • Active wear market • Athleisure market • Fast fashion
06 OUR STRENGTHS strong bones & Denim Thrones Not to toot our own horns but we have been doing this denim thing for some time now and we do think we are getting a few things right. Turn the page to see what things we think enable us to have such strong customer loyalty.
OUR Strengths A FEW THINGS THAT WE ARE DOING REALLY WELL THAT SERVE AS A FOUNDATION FOR WHAT WE DO
CONSISTENCY IS KEY The Levi Strauss brand is iconic because decade after decade they maintain their brand identity. They are allAmerican, made-to-last and reliable. When you a red label on a classic pair of denim, you already know that they are Levi’s because of their strong brand recognition.
KARMA CHAMELEON Without a doubt, Levi’s have been able to withstand the test of time because they are quick to adapt to the developing world. From joining the tech world with performance denim to discovering more environmentally conscious ways to dye jeans, the Levi’s Company isn’t afraid of change.
STYLE WITH EASE Although our original 501 jean is our most prized possession, we have created our signature denim in a huge range of styles and washes perfect for our unique consumer base.
QUALITY OVER QUANTITY Quality is extremely valued at Levi Strauss Company. We want to ensure that the merchandise we release in the stores are going to be durable and long lasting which is why we are known for our high quality products. 32
07 Our Strategies brand with a plan To keep Levi’s current for today’s buyer, we have been working on new campaigns and marketing strategies that can appeal to real women. We have surveyed women about our jeans, launched an all new women’s collection with Alicia Keys and we have gone back to focusing on what we do best: denim.
OUR STRATEGIES A glimpse at our journey going all the way back to 1853.
WHAT DOES THE MODERN ? R A E W N A WOM Environmentally in tune Our current customer focus is on the environmentally conscious woman. Creating new extensions like our Water < Less denim, is one of the ways we are appealing the modern woman. Up and at ‘em One of our latest developments include our Wedgie Fit. Still maintaining all of the signature Levi’s characteristics, like our long lasting denim and iconic label, this fit is designed to give you your “cheekiest fit” by ALICIA KEYS AND OUR JEANS hugging your hips and waist. In line with our goal to improve our quality and fit of our jeans, we have relaunch our women’s division with the help of Alicia Keys. To create the new collection, we received input from real women all around the world and worked hard to make discoveries with slimming technologies and stretch to accentuate the cures of the female body. 36
Back to basics We are focused on placing the emphasis on our original 501 fit that debuted back in 1873 and making it the must-have jean for each of our consumers. Itâ€™s all in the details We pride ourselves on delivering high quality apparel and across the whole company we want to go back to that mindset. At Leviâ€™s, we plan to work on perfecting our detail and form to ensure that every style and fit is both functional and stylish. Onward and upward The world is developing at a rapid pace and we want to ensure that we stay on trend. In order to do that we are making it our central goal to modernize denim with new washes, styles and even fabrics. Tech talk Not only do our consumer lead a busy lifestyle but they also lead an active lifestyle. We our presently, producing performance denim that keep the classic look of jeans but is able to endure athletic tasks.
08 Collections & COLLABORATIONS better as friends The Leviâ€™s shopper is diverse. Sheâ€™s interested in style, sustainability, philanthropy and functionality. Through our collections and collaborations we are working to make sure our jeans not only look good but they are doing good as well.
COLLECTIONS & Collaborations A LOOK AT SOME OF OUR CURRENT COLLECTIONS AND COLLABORATIONS.
WATER < LESS DENIM SAME QUALITY, LESS WATER The Water < Less Denim still comes in the same classic Levi’s fits but is now made with less water in order to strive towards making less of an impact on the planet.
LINE 8 FOR THE MODERNIST Line 8 is a collection designer for the jeans lover who enjoys simplicity and understated details. This collection is available for both men’s and women’s.
THE WEDGIE FIT “SHOWING YOUR ASSETS” We are known for having a variety of fits and styles perfect for our diverse consumer base. The Wedgie Fit hugs the waist and hips helping to show off your curves. 40
LEVI'S X GOODWILL DONATE, PLEASE Levi’s has partnered with Goodwill to give customers free shipping labels to mail away their unwanted clothes. For each box received Levi’s will donate $5 dollars to Goodwill for up to $50,000.
BETTER COTTON INITIATIVE Eco-conscious creations The Better Cotton Initiative is designed to help improve cotton farming conditions and standards to help preserve the land. In addition to many other retailers, Levi’s has joined the cause to improve how they utilize cotton.
LEVI'S COMMUTER RIDE ALONG Including features like a higher back and more durability, your favorite Levi’s jeans are now perfect for your active lifestyle.
09 current trends WE ARE ON POINT Searching high and low, through runways and street style images, we found the fashion trends that would best fit with the Leviâ€™s aesthetic.
PATCHWORK FUSING MULTIPLE SHADES OF DENIM TOGETHER FOR A TOTALLY CUSTOMIZED LOOK
EMBELLISHED FROM PATCHES TO PAINTING, ANYTHING ADDED TO DENIM ONLY MAKES IT BETTER
RETRO Taking A PAGE FROM 70’S, RETRO DENIM IS ACQUIRING ALL NEW SILHOUETTES
GRUNGE OVERSIZED. DISTRESSED. VINTAGE. 90’S. and CAN NEED WE SAY, DENIM.
Denim Alternatives New TREATMENTS GIVEN TO DENIM LIKE METALLIC AND LIQUID COATINGS ARE GIVING AN UPDATED FEEL TO AN OLD CLASSIC
SUSTAINABLE THERE’S NO SECRET THAT PRODUCING DENIM USES A TON OF WATER BUT THERE ARE OPTIONS TO REDUCE OUR IMPACT.
10 Lifestyle trends living la vida loca We donâ€™t want our jeans to just be worn, we want our jeans to be lived in. We took a look at some lifestyle trends, to help us gain insight as to what is involved in our customerâ€™s daily life.
ROSE QUARTZ AND SERENITY PEACE AND LOVE.
The sof tness of Pantoneâ€™s colors of the year suggest that we could be looking to find more peace and tranquility within our fast paced lifestyles. Also because serenity is a shade of blue, Leviâ€™s has the opportunity to incorporate it as a wash for their denim.
Active Living Bend and move.
More and more people are assuming an active lifestyle. From the popularity of Soul Cycle to the rise of athleisure, consumers are on the go. Creating jeans that can withstand a full day from the gym to going out will be key to helping denim stay on top.
MAXIMALISM V. MINIMALISM MORE OR LESS?
Last year, minimalism was huge. Neutral color palettes and limited patterns became wardrobe staples. But now, fashion is making room for maximalism which is more expressive and filled with large prints. Perfect for a DIY Leviâ€™s consumer who loves to personalize.
AUTHENTICITY Better being you
Since the powers of Photoshop have been revealed and the rise of the YouTuber, people are reverting back to authenticity. Staying true and being who they are without any filters or barriers is whatâ€™s in. Leviâ€™s is all about being unapologetically authentic.
11 Six month buying plans money, money, money Our six month corporate buying plan is right on target for the growth we foresee for Leviâ€™s. Planning our sales percent increase at 3.00%, is aggressive compared to Leviâ€™s steady growth of 1.00% over the previous years. However, we believe that based on our research in to the current trends and lifestyles of our consumers, this increase is possible.
LEVI’S SIX MONTH CORPORATE BUYING PLAN FALL 2016 wOMEN’S DENIM Plan Net Sales, Fall 2016: 124,630.0 Est. Net Sales, Fall 2015: 121,000.0 Plan % Last Year: 3.00% Average Stock, Retail: 72686.8 Inventory Turnover: 1.71 Planned Reductions, $: 18694.5 Reductions % Sales: 15.00% Plan IMU %: 58.26%
6 Month Buying Plan (4 - 5 - 4 Weeks) 000’s
August September October Net Sales: 21187.1 23679.7 18694.5 % Fall: 17.00% 19.00% 15.00% Plan BOM Stock: 76273.6 80511.0 72908.6 Stock / Sales Ratio: 3.6 3.4 3.9 Plan EOM Stock: 80511.0 72908.6 71039.1 Plan Reductions: 2804.2 3178.1 2804.2 % Fall: 15.00% 17.00% 15.00% Purchases, Retail: 28228.7 19255.3 19629.2 Purchases, Cost: 11782.7 8037.2 8193.2 64
â€˘ Inventory turnover rate is planned at 1.71 because denim is not turn as fast in terms of sales because you never want to be out of a size. â€˘ September and August planned net sales are higher due to back to school sales as well as for December when students prepare to go back to school November December January Fall 2016 18694.5 23679.7 18694.5 124,630.0 15.00% 19.00% 15.00% 100.00% 71039.1 75775.0 67300.2 72686.8 3.8 3.2 3.6 75775.0 67300.2 65000.0 3365.0 3738.9 2804.2 18694.5 18.00% 20.00% 15.00% 100.00% 26795.5 18943.8 19198.5 132050.9 11184.4 7907.1 8013.4 55118.1 65
LEVI’S SIX MONTH SAN FRANCISCO BUYING PLAN FALL 2016 wOMEN’S DENIM Plan Net Sales, Fall 2016: 2,730.0 Est. Net Sales, Fall 2015: 2,650.0 Plan % Last Year: 3.02% Average Stock, Retail: 1255.4 Inventory Turnover: 2.17 Planned Reductions, $: 409.5 Reductions % Sales: 15.00% Plan IMU %: 58.26%
6 Month Buying Plan (4 - 5 - 4 Weeks) August September October Net Sales: 464.1 518.7 409.5 % Fall: 17.00% 19.00% 15.00% Plan BOM Stock: 1299.5 1348.6 1228.5 Stock / Sales Ratio: 2.8 2.6 3.0 Plan EOM Stock: 1348.6 1228.5 1228.5 Plan Reductions: 61.4 69.6 61.4 % Fall: 15.00% 17.00% 15.00% Purchases, Retail: 574.7 468.2 470.9 Purchases, Cost: 239.9 195.4 196.6 66
• Inventory turnover rate is 0.46 higher than the corporate plan because San Francisco store is the flagship store so it generates more business. • The sales forecasts in September are higher due to back to school season and in December as well because of the holiday season • The weather in San Francisco is more temperate so seasonally there aren’t too many jumps in inventory. November December January Fall 2016 409.5 518.7 409.5 2,730.0 15.00% 19.00% 15.00% 100.00% 1228.5 1348.6 1187.6 1255.4 3.0 2.6 2.9 1348.6 1187.6 1146.6 73.7 81.9 61.4 409.5 18.00% 20.00% 15.00% 100.00% 603.3 439.5 430.0 2986.6 251.8 183.5 179.5 1246.6 67
LEVI’S CHICAGO SIX MONTH BUYING PLAN FALL 2016 wOMEN’S DENIM Plan Net Sales, Fall 2016: 1,560.0 Est. Net Sales, Fall 2015: 1,515.0 Plan % Last Year: 2.97% Average Stock, Retail: 759.6 Inventory Turnover: 2.05 Planned Reductions, $: 234.0 Reductions % Sales: 15.00% Plan IMU %: 58.26%
6 Month Buying Plan (4 - 5 - 4 Weeks) 000’s
August September October Net Sales: 296.4 327.6 234.0 % Fall: 19.00% 21.00% 15.00% Plan BOM Stock: 829.9 851.8 748.8 Stock / Sales Ratio: 2.8 2.6 3.2 Plan EOM Stock: 851.8 748.8 748.8 Plan Reductions: 35.1 39.8 35.1 % Fall: 15.00% 17.00% 15.00% Purchases, Retail: 353.3 264.4 269.1 Purchases, Cost: 147.5 110.4 112.3 68
• Inventory turnover rate is planned at 2.05 which is slightly higher than the corporate plan because Chicago is a high volume store. • September, August and December planned with higher net sales for back to school and holiday sales. • Chicago does experience extremely cold winters, so we dropped our sales in January because customers are less likely to brave the weather to shop. November December January Fall 2016 234.0 312.0 156.0 1,560.0 15.00% 20.00% 10.00% 100.00% 748.8 842.4 655.2 759.6 3.2 2.7 4.2 842.4 655.2 640.0 42.1 46.8 35.1 234.0 18.00% 20.00% 15.00% 100.00% 369.7 171.6 175.9 1604.1 154.3 71.6 73.4 669.5 69
12 Assortment PLAN you need it, we got it Our assortment plan is comprised of the products that we feel will best maximize sales for Leviâ€™s. First, we classified our denim in to our top selling categories like denim jackets and jeans. Then we narrowed our product focus in to denim fit. Because what good is a pair of blue jeans that just donâ€™t fit right?
LEVI’S CORPORATE ASSORTMENT PLAN FALL 2016 wOMEN’S DENIM
Planned Purchases, Retail: $132,050,900.00
ASSORTMENT BY DENIM CLASSIFICATION % $ Classification Total Purchases Jackets 12% $15,846,108 Jeans 65% $85,833,085 Shorts 10% $13,205,090 Skirts 8% $10,564,072 Other 5% $6,602,545 100% $132,050,900
ASSORTMENT BY JEAN FIT % $ Fits Total Purchases Wedgie 15% $12,874,962.75 501 20% $17,166,617.00 Boyfriend 20% $17,166,617.00 Skinny 20% $17,166,617.00 Flare 15% $12,874,962.75 Relaxed 10% $8,583,308.50 100% $85,833,085 72
13 STATEMENT OF OPPORTUNITY IS IT WORTH IT With anything a level of risk or opportunity can be assumed but because we have taken the time to investigate what is going on within the denim industry as well as with our Leviâ€™s shopper we feel that improving our women wear denim, is a choice that will thrive for Leviâ€™s.
STATEMENT OF OPPORTUNITY
At Levi Strauss and Co., we believe our mission to continue to reinvent the blue jean. We continue to innovate the our core product in to a variety of fits, styles and washes making us a one stop shop for our consumers’ needs. Whether she is looking for something trendy like our Wedgie Fit® denim or if she is opts for classic 501® jean, we are here for her. Not only are we focused on delivering a high quality product, we also believe that how our denim is produced matters. We have been working on sustainable denim options like our Water<Less Denim® that enables us to reduce our impact which is something our consumers care about. Because we are one of the leaders in the denim industry, we feel that we have an opportunity to elevate the denim standards to both on trend for our consumers and sustainable for the planet. Live in Levi’s. 77