Lotti Martin-Fuller 201038548 Fashion Marketing DESN 1355 Marketing Mix Report Word Count: 2646 Leather Jacket: New Look Vs All Saints
CONTENTS Abstract Introduction Literature Review My Chosen Brands Methodology Low Value Retailer : New Look Product Price Promotion Place High Value Retailer : All Saints Product Price Promotion Place Conclusion References Appendices Illustrations
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ABSTRACT The aim of this report is to look into and examine the differing functions of the marketing mix across two retailers at different market levels – low and high. Through my widespread research into the brands, I have found that each had a contrasting marketing strategy that mirrored where they stood in the market relating to the 4ps; product, price, promotion and place. Furthermore, I can make an in-depth evaluation on the marketing mix as the report discusses two similar garments sold by each retailer which highlights the differences in their market applications.
INTRODUCTION
The following report has been prepared in order to investigate and evaluate the application of various marketing methods of two brands in the marketing mix – product, price, promotion and place. The two chosen retailers are positioned at different market levels (see appendix A). Through conducting in-depth primary and secondary research, and also sourcing the similar styled garment, I aim to display the differences in the marketing mix between the two brands. Additionally, the purpose of this report is to show the importance of a marketing strategy in order for a retailer to be successful. Today’s consumers are well informed about products and prices and therefore have an “evolving set of complex needs and wants which can be satisfied by a range of competing alternatives” (Jackson and Shaw, 2009) – these competing alternatives being the marketing mix.
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LITERATURE REVIEW Marketing is a business philosophy, a way of thinking about brand from the potential customer’s perspective. It is concerned with “anticipating, identifying and satisfying customer needs” (Easey, 2009), and this is done by using the marketing mix – the 4Ps of marketing; product, price, promotion and place (Posner, 2015). Each of the 4Ps are discussed below: Product: refers to the item being sold. It is anything that can be offered in the market for attention, acquisition, use or consumption that intends to satisfy the needs of a consumer (Easey, 2009). Products can either be tangible (something that be touched or held) or intangible (a service, idea or psychological element) (Posner, 2015). Price: The amount a customer agrees with the seller for a product or service. Retail price refers to the price paid by customers, however the selling price could refer to a transaction anywhere in the supply chain (Jackson and Shaw, 2009). Promotion: means the activities that communicate the good aspects of a product and therefore persuade the target market to buy it (Kotler et al, 2016). Place: this involves the companies’ activities and distribution of goods that therefore make the product available to the customers (Kotler et al, 2016). This involves efficient positioning and a distribution channel which often refers to retailing, wholesaling or franchising (Marketing mix, 2017). The marketing mix is a set of “tactical marketing tools” that a brand uses to produce the response that it wants in the target market, it is everything that a brand can do to influence the demand for its product (Kotler et al, 2016). Through studying the marketing mix, the 4P marketing theory and other secondary research, I was able to link the marketing strategies of my two chosen brands and contextualise my findings against this.
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MY CHOSEN BRANDS
In order to examine differing marketing strategies, I have chosen two brands at alternate market sector levels. The first being New Look, an ‘economy high street brand’ with the latter being All Saints, a ‘bridge brand’ or ‘high end high street brand’ (see appendix A). New Look is a mass market retailer, where goods are manufactured at high volumes with a cheap price tag for basic items – marketed to a wide range of consumers. All Saints, on the other hand, have a “core customer profile” (Create a fashion brand, 2017), they have a defined style and aesthetic, choose not to cater for everyone for everyday wear – they sell specialist items for special events and occasion wear (see appendix B).
METHODOLOGY
In order to produce my report on the two different marketing strategies, I had to collect both qualitative (i.e. statistics and facts) and quantitative data (i.e. opinions and views). In order to gather this information, I carried out primary research in the form of a store observation which involved going into my chosen shops and sourcing information on the product. This helped me gain a stronger insight into how each brand differed from one another in their marketing strategies and their use of the 4Ps marketing mix. I not only carried out secondary research for my literature review, but also utilised websites online about the brands and how successful they are at their market level by accessing credible sources such as books, and peerreviewed journal articles.
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LOW VALUE RETAILER: NEW LOOK
[FIG 1]
New Look has been around since 1969, with the brand self-proclaiming that they have a “vision of becoming “the chosen brand for an inspiring accessible fashion experience” (New Look, 2017). New Look have a reputation for being on the cheaper end of the high street as they produce low value goods that are mass marketed, they redefine fast fashion as they upload over 800 new products every week (New Look, 2017a). Product The New Look ‘Belted Leather Look Cropped Biker Jacket’ follows a somewhat similar design to the All Saints jacket, but is distinctively cheaper looking from the onset which reflects the £39.99 price tag. This jacket is not an investment, as the quality of the materials suggest that it would have a short life cycle with even the brand suggesting its seasonal (New Look, 2017b). Very poor quality materials have been used to create this jacket: -Shell: 100% Polyurethane. -Lining: 100% Polyester. -Back: 89% Polyester, 7% Cotton, 4% Viscose. The leather-look jacket, made entirely out of polyurethane (a lightweight synthetic fibre) is available in 3 colours, navy, red and green. It is clear that the jacket is of poor quality as it is creasing with a plastic-like sheen on pictures (see figure 1) and this is supported by my findings on my visit to the store. Upon sourcing the jacket, I picked it off the hanger and immediately felt the feather-like weight and a thin layer of material. The belt and plastic buckle hung off the jacket which did not keep its shape either on the hanger or on the body, which it hugged unflatteringly. This emulates the cheap production of this garment made of synthetic fibres, which are machine washable and easy to care for.
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LOW VALUE RETAILER: NEW LOOK
Although New Look offer added value features in the form of: -Leather-look finish - Zip front fastening - Simple long sleeves - Belted waist - Cropped hem (New Look, 2017b), the core product is a cheaply made, non-exclusive and mass marketed jacket that could be seen anywhere on the high street. Price New Look compete with other low-market level companies such as Primark for price, with New Look’s average dress price being £18 (Geoghegan, 2013). New Look heavily partake in penetration pricing strategies which means they set their prices low in order to attract customers, and raising the price once they have reeled people into their market share (Monroe, 2003). This is a way for the brand to gain customer attention when facing hardship in releasing their product into the marketing environment full of competitors – and so they also adopt a competitor based strategy alongside penetration pricing. The brand often uses discounted sales incentives to lure customers in, and offer a student discount all year around, this suggests that the retailer relies upon customer bonds made from these incentives. However, this damages the brands value as people see the brand as a discounted store, or will only start to shop there if there is a discount deal on.
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LOW VALUE RETAILER: NEW LOOK
Promotion New Look is a multi-channel brand, with promotions relying heavily on social media channels, with over 3 million Facebook fans, 1.4 million on Instagram. Their website ships to over 120 countries world-wide, and it generates 15% of sales (New Look, 2017a). The retailer states that “the customer is at the heart of everything that we do� (New Look, 2017a), and that the communication between the customer and the brand is more than selling clothes but bringing real emotions. New Look beats out rivals such as Primark because of its presence online, with ecommerce rising by 45% from 2014-15 (Baldwin, 2015) (see appendix C for New Look full year profits 2014-15). The retailer is also now trading with 11 third-party partners such as big names Asos and Zalando. Place New Look has over 850 stores in 21 countries – they are a fully international brand. Although the brand was born in the UK, the products are produced in Bangladesh and China and so the brand have little control over their garments and how they are made. The materials and factories used for the fast fashion production of garments are not sustainable and therefore reflect the low quality of the clothing and therefore the low price tag and their position in the global market. New Look follows an intensive distribution strategy as the products are mass-marketed (see appendix E for distribution channels)
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[FIG 2]
HIGH VALUE RETAILER: ALL SAINTS
All Saints is a British fashion house that was established in 1994, it operates in a culture of innovation and design – it has strong links to the music and film industries as it expresses attitude and individuality (Business of Fashion, 2017). All Saints is infamous for its “premium leather”, the chosen garment itself being one of the many “iconic biker jackets” (Business of Fashion, 2017). The brand claim that they have an obsession with delivering an “immersive experience” for the whole customer base in a way to embrace every international culture (All Saints, 2015a). Product The All Saints Balfern Leather Biker Jacket is a best seller, a biker jacket cut in a slim fit, crafted from “butter-soft sheep leather that gets more supple with each wear” (All Saints, 2017b) (see figure 2). The significant fact that the jacket gets better with age and wear shows reflects the £318 price tag, it is an investment for those who indulge in this item. Good quality materials have been used to craft this jacket: -100% Sheep leather -Lining: 54% Viscose, 46% Cotton -Sleeve Lining: 100% Polyester. Although All Saints is a high street brand, it sits on the high end of the spectrum, and so this jacket made out of sheep leather is not as accessible as the New Look faux leather jacket, both in its place and price. The sheep leather is an exclusive and expensive material so therefore the jacket has a long product life cycle as it stays the same, or even gets better quality in time making it a staple for the wardrobe. This jacket is to be specialist cleaned only to be kept in good condition, however it is “fairly durable and splash proof” (Burford, 2016) showing that it is practical as well as being appealing.
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HIGH VALUE RETAILER: ALL SAINTS
This timeless biker also has added value features in the form of: -Press stud lapels. -Press stud epaulettes. -3 zip pockets. -Zip cuffs. -Asymmetric zip fastening. -Buckle belt at the hem. -All Saints logo-engraved zips. (All Saints, 2017b). The addition of these added value features shows that the garment is of very high quality, with the structure of the jacket being held by the material at all time – the metal clasp buckle and belt are not flimsy (see figure 2). The hardware on the jacket is made of silver which will not rust or discolour which suggests that the jacket will be a long lasting garment in the wardrobe unlike New Look’s jacket which has a short product life cycle. Price All Saints use a mixture of pricing strategies to market their products, one strategy being cost-plus pricing. As All Saints is an expanded brand across 27 countries, there are a range of expenses that need to be taken into consideration such as high import taxes. Therefore, a cost-plus pricing guarantees the brand a profit margin by adding to the original cost of the product. The brand is aware that they need to entice price-sensitive customers, but to ensure a profit when a sale is made. This is successful, as a customer will pay for the benefits they receive from the garment (Anderson and Wynstra, 2010).
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HIGH VALUE RETAILER: ALL SAINTS
All Saints also use a premium pricing strategy for their brand, they keep the prices of the leather jackets in particular artificially high as they are a favourable or reputable part of their brand. Customers are ‘exploited’ as they will pay for a name alongside quality however they often see a high price tag as a better quality garment, it gives the consumer a feeling of treating themselves. The brand also indulges in premium pricing as they are involved with activism and philanthropy which draws in customers as they then feel good about their purchase. Promotion Despite All Saints being a huge worldwide retailer, the brand doesn’t use normal promotional strategies such as Tv advertisements, this therefore makes the retailer stand out from the crowd as it gains a following from elsewhere. The brand likes to blend music and fashion together with the creative director, Wil Beedle, exclaiming that a traditional ad model “isn’t compatible” with the brands versatility and nimbleness (Mortimer, 2014). All Saints opts for a content-led strategy for promotions, making short films such as ‘The Biker Project’, which features the “design and craftsmanship of All Saints’ leather jackets” (Mortimer, 2014) with Beedle explaining that these are far more beneficial than bland partnerships used in other brands such as New Look. When I visited the store, I found that there were no promotional sales and they also did not offer student discount which suggests that their target market is of a more affluent age.
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HIGH VALUE RETAILER: ALL SAINTS
Additionally, the All Saints store and the infamous layout is a promotional strategy on its own, with every store mirroring the signature distressed, industrial and gothic store on Carnaby Street in London. The window display always features Sanger sewing machines which is a successful marketing strategy as the shop window is easily identified by many. This reflects the high end prestige of the brand and its position in the market as there is an element of fluidity throughout. Place There are 230 All Saints stores across 27 countries, with flagship stores globally, namely Carnaby Street in London and on Broadway in New York – dubbed “the flagship in the capital of our planet” by Stephen Craig, the chief executive (Finch, 2010). Their products are available on a large scale, in wellpopulated and fashion forward cities, however the brand has adopted an exclusive distribution strategy (see appendix E for distribution channels). All Saints pride themselves on sourcing their materials from ethical labour and they are a member of the CITES management authority (see appendix D) which ensures that there is traceability and sustainability on their products (All Saints, 2017c).
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CONCLUSION
In conclusion, both New Look’s and All Saint’s pricing levels reflect the quality of their products and where there sit in the market level hierarchy. New Look produces a low level of goods, adopting both a penetration pricing strategy to lure customers in, but a competitive based strategy also which explains their low prices. They also opt for a multi-channel promotion strategy relying heavily on advertising and their social media presence in order to get sales. This is in stark contrast to that of All Saints who opt out of advertising, allowing their cult following and brand value to sell their garments for them. Overall, I think that my research has found that the higher the marketing positioning, the better the sustainability and traceability in the production methods. Moreover, my findings are only applicable to these two brands and although they are representative of the successfulness of the marketing mix in different levels of the market sector, more research can be performed in order to confirm them.
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REFERENCES All Saints. 2015a. Welcome to the All Saints Career Page. [Online]. [Accessed 7 May 2017]. Available from: https://talent-allsaints.icims.com/jobs/intro?hashed=435714747&mobile=false&width=971&height=500&bga=true&needsRedirect=false&jan1offset=0&jun1offset=60 All Saints. 2017b. Balfern Leather Biker Jacket. [Online]. [Accessed 7 May 2017]. [Available from: https://www.allsaints.com/women/leather/allsaints-balfernbiker/?colour=5&category=25 All Saints. 2017c. FAQS. [Online]. [Accessed 7 May 2017]. Available from: https://www.allsaints.com/new-faqs/ Anderson, J.C., and Wynstra, F. 2010. Purchasing Higher-Value, Higher-Price Offerings in Business Markets. Journal of Business-to-Business Marketing. 17 (1): 29– 61. Baldwin, C. 2015. New Look strategy proves fruitful as full-year profits increase. [Online]. [Accessed 7 May 2017]. Available from: https://www.retailweek.com/sectors/fashion/new-look-strategy-proves-fruitful-as-full-year-profits-increase/5075527.article Burford, L. 2016. All Saints Balfern Sahara Leather Biker Jacket Review. [Online]. [Accessed 7 May 2017]. Available from: http://raindropsofsapphire.com/2016/01/26/all-saints-balfern-sahara-leather-biker-jacket-review/ Business of Fashion. 2017. All Saints. [Online]. [Accessed 7 May 2017]. Available from: https://www.businessoffashion.com/community/companies/allsaints Create a fashion brand. 2017. The Many Market Levels of Fashion Brands. [Online]. [Accessed 7 May 2017]. Available from: http://www.createafashionbrand.com/the-many-market-levels-of-fashion-brands/ Easey, M. 2009. Fashion Marketing. Third Ed. Chichester: Wiley-Blackwell Geoghegan, J. 2013. New Look to up quality as it competes with high street giants. [Online]. [Accessed 7 May 2017]. Available from: https://www.drapersonline.com/news/new-look-to-up-quality-as-it-competes-with-high-street-giants/5052176.article?v=1 Jackson, T. and Shaw, D. 2009. Mastering Fashion Marketing. Hampshire: Palgrave Macmillan Kotler, P., Armstrong, G., Harris, L.C, Piercy, N. 2016. Principles of Marketing. Seventh Ed. London: Pearson
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REFERENCES New Look. 2017a. Who we are. [Online]. [Accessed 7 May 2017]. Available from: http://www.newlookgroup.com/who-we-are/our-people New Look. 2017b. Navy Belted Leather-Look Cropped Biker Jacket. [Online]. [Accessed 7 May]. Available from: http://www.newlook.com/shop/womens/jacketsand-coats/navy-belted-leather-look-cropped-biker-jacket-_513014341 Marketing Mix. 2017. The Marketing Mix 4P’s and 7P’s Explained. [Online]. [Accessed 7 May 2017]. Available from: http://marketingmix.co.uk Monroe, K.B. 2003. The Pricing Strategy Audit. Cambridge: Strategy Publications Mortimer, N. 2014. Why All Saints shuns traditional ad campaigns in favour of content creation. [Online]. [Accessed 7 May 2017]. Available from: http://www.thedrum.com/news/2014/12/19/why-allsaints-shuns-traditional-ad-campaigns-favour-content-creation Posner, H. 2015. Marketing Fashion. Second Ed. London: Laurence King Publishing
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APPENDICES Appendix A:
Appendix B: The explanation of the two market levels: Mass Market Economy Level (New Look) -Clothing range is broad -Price tags range from £10-£60 depending on the item (approx.) -Goods manufactured in large volumes -Usually there is a main flagship store in a city, as well as plenty other stores located all over the country -Garments are pitched at the ‘everyday’ fashion consumer, trying to sell to everyone and offer items that sell quickly as there is new stock every 6-12 weeks. -Very fast fashion High End High Street OR Bridge Brand (All Saints)
Market Level Pyramid : Angelique,D. 2014. Market Levels. [Online]. [Accessed 7 May 2017]. Available from: https://www.slideshare.net/AngeliqueD/market-levels
-Usually focus on one or two types of trends/styles that aligns with their customers per season -Focuses on one or two event ranges, ie. Evening or day wear, rather than the mid / economy value market levels which try to cater for everyone -Price and quality of products are very high for the high street -As well as core customers, they also have a range of customers who turn to the shop for special products and occasions -Price tags range from £40-£500 depending on the item, even more for a specialist rare item (approx.) (Create a fashion brand. 2017. The Many Market Levels of Fashion Brands. [Online]. [Accessed 7 May 2017]. Available from: http://www.createafashionbrand.com/the-many-market-levels-of-fashionbrands/)
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APPENDICES Appendix C: New Look’s Full year profits Increased “Profit before tax more than doubled from £20.7m in 2014 to £50.6m in 2015 and revenue increased 3.4% to £1.4bn.” “New Look also reported that UK like-for-like sales were up 5% as well as a 4% increase in total brand like-for-like sales for its 52 weeks ending March 28, 2015. The retailer refurbished 291 stores and opened a further 37 over the year.”
Appendix D: CITES is the Convention on International Trade in Endangered Species of Wild Fauna and Flora. It aims to ensure that the international trade of specimens and products of wild animals and plants does not threaten their survival. All Saints works alongside this convention to ensure their materials are ethically sourced and are not harming the environment.
(Baldwin, C. 2015. New Look strategy proves fruitful as full-year profits increase. [Online]. [Accessed 7 May 2017]. Available from: https://www.retailweek.com/sectors/fashion/new-look-strategy-proves-fruitful-as-full-year-profitsincrease/5075527.article)
Appendix E: Food Labo. 2017. Distribution Channels. [Online]. [Accessed 7 May 2017]. Available from: http://www.foodlabo.net/ch annel.html
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ILLUSTRATIONS Page 0: New Look. 2017. Navy Belted Leather-Look Cropped Biker Jacket. [Online]. [Accessed 7 May 2017]. Available from: http://www.newlook.com/shop/womens/jackets-and-coats/navy-belted-leather-look-cropped-biker-jacket-_513014341 All Saints. 2017. Balfern Leather Biker Jacket. [Online]. [Accessed 7 May 2017]. Available from: https://www.allsaints.com/women/leather/allsaints-balfernbiker/?colour=5&category=25 Page 2: All Saints. 2017. The Lookbook. [Online]. [Accessed 7 May 2017]. Available from: https://www.allsaints.com/lookbook/women/ Page 3: All Saints. 2017. New Arrivals. [Online]. [Accessed 7 May 2017]. Available from: https://www.allsaints.com Page 4: All Saints. 2017. New Arrivals. [Online]. [Accessed 7 May 2017]. Available from: https://www.allsaints.com Page 5: New Look. 2017. Navy Belted Leather-Look Cropped Biker Jacket. [Online]. [Accessed 7 May 2017]. Available from: http://www.newlook.com/shop/womens/jackets-and-coats/navy-belted-leather-look-cropped-biker-jacket-_513014341 Page 6: New Look. 2017. Navy Belted Leather-Look Cropped Biker Jacket. [Online]. [Accessed 7 May 2017]. Available from: http://www.newlook.com/shop/womens/jackets-and-coats/navy-belted-leather-look-cropped-biker-jacket-_513014341 Page 7: New Look. 2017. Navy Belted Leather-Look Cropped Biker Jacket. [Online]. [Accessed 7 May 2017]. Available from: http://www.newlook.com/shop/womens/jackets-and-coats/navy-belted-leather-look-cropped-biker-jacket-_513014341 Page 8: All Saints. 2017. Balfern Leather Biker Jacket. [Online]. [Accessed 7 May 2017]. Available from: https://www.allsaints.com/women/leather/allsaintsbalfern-biker/?colour=5&category=25 Page 9: All Saints. 2017. Balfern Leather Biker Jacket. [Online]. [Accessed 7 May 2017]. Available from: https://www.allsaints.com/women/leather/allsaintsbalfern-biker/?colour=5&category=25 Page 10: All Saints. 2017. Balfern Leather Biker Jacket. [Online]. [Accessed 7 May 2017]. Available from: https://www.allsaints.com/women/leather/allsaintsbalfern-biker/?colour=5&category=25 Page 11: All Saints. 2017. Balfern Leather Biker Jacket. [Online]. [Accessed 7 May 2017]. Available from: https://www.allsaints.com/women/leather/allsaintsbalfern-biker/?colour=5&category=25 Page 12: All Saints. 2017. The Lookbook. [Online]. [Accessed 7 May 2017]. Available from: https://www.allsaints.com/lookbook/women/
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