Questions for Harrington Case
1) How well does active-wear fit with the Vigor division (e.g. target customer, advertising and sales strategy, production capabilities)? What possible impact could this new product line have on the Vigor brand name?
Harrington Collection's manufacturer and retailer of high-end women's apparel. The Vigor division of Harrington Collection's is aimed to appeal to younger fashion conscious customers. The division sells career wear, dreis a learge sses, skirts, blouses, pants and coats. The ideal customers targeted by the Vigor division are "trend setters", women aged 25-50 who are affluent, college-educated, and proffessionals seeking fashionable yet comfortable work clothing. The retail price ranges for
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2) What are the potential retail trade and competitor reactions? Are there any potential channel conflict issues?
A new active-wear line offered by Vigor could cause some potential reactions from competitiors and retail traders.
The women's apparel market is highly competitive. With the launch of a new active-wear line from Harrington Collection's, more and more competitors will start to realise the potential value in in producing an active-wear line of their own. The active-wear market is growing so rapidly (expected to double turnover from 2007 to 2009), that eventually all of Harrington's competitors would likely be expected to launch a line of their own, relying on existing brand loyalty and high-scale advertising campaigns to capture market share and move units.
With such high levels of product differentiation between products and an already concetrated industry, it would be difficult for Harrington Collection's to stand out and secure market share for the new active-wear line, without signifacnt costs towards an effective advertising and marketing campaign. Harrington would most likely need to build on the existing customer base and/or appeal to consumers in an untargeted market space. For example high-end quality active sports wear.
Further reactions from competitors could be to provide cheaper alternatives that may appear similar to the offering provided by the Vigor brand. The result of this could be possible price wars to obtain market
The global women’s clothing industry is expected to exceed $621 billion in 2014, marking a 12% increase in five years, reports MarketLine. Clothing retailers account for the largest share of the market at almost 65% in terms of value. We will first seek customers locally, but will increase our range as we build our brand and are confident in our image.
The fitness clothing market is growing rapidly. Customers’ new found inclination towards living healthier lifestyles has produced an increase in participation of people into various physical activities. Hence, the high levels of competition in the fitness and
Although the market for separates is certainly viable given promising growth in test markets, it is not a market that makes sense for Hart, Schaffner & Marx (HSM) to compete in. The trend certainly shows a divergence in how some customers view their needs with regards to semi-formal clothing, but the firm runs the risk of diluting not only the perceived quality of its clothing, but also alienating its current client base that is partial to the experience HSM offers in its stores. This experience includes personalized expertise on new fashions, custom tailoring, and the status associated with purchasing and wearing the company’s clothes.
Companies like Under Armour, Nike and Adidas/Reebok have high threats of substitute´s products. These companies share the sport apparel industry and are vulnerable to competitive pressure from the actions of buyers whenever they view that their products can be substituted for others. The availability of substitutes invites the costumer to compare performance, features, and ease of use as well as price. Under Armour’s major competitors are Nike and Adidas/Reebok because they have a similar or competing product offerings. The top sport apparel brands offer similar products and that is why each one of them needs to keep a high standard and produce good quality products in order for customers to keep buying their product.
The athletic apparel industry has shown a large increase in popularity. Global sales of sport clothing have increased from 146.1 billion US dollars in 2007 to 162 billion US dollars in 2012(Global Participative Sport as Consumption). Particularly in the United States, sales of sport apparel have increased by 7% from 2013 to 2014 (Wingus). There has been a large trend in healthy living, as “activewear accounted for $33.7 billion in sales and made up 16 percent of the apparel market” (Wingus). The industry is booming, as sportswear, specifically yoga pants, has transformed into people’s daily apparel. (Refer to Appendix Table 1) Huffington post noted, “people are wearing trendy workout clothes all day, every
Lululemon is a large company, making clothing for athletic activities, not only are they in the women’s athletic range, but they have hit the men’s market and youth range as well. A SWOT analysis will be used to break down Lululemons strengths, weaknesses, opportunities, and threats to the business. Strengths which Lululemon have achieved include multi-faceted and community-based approach strategy, making customers feel part of a community through marketing strategies like there “ambassador program, social media, in-store community boards and grassroots initiatives” (Lululemon, 2016 Annual Report, 2016, p. 3). Touchpoints which have been a part of this multi-channel include Lululemons websites www.lululemon.co.nz and ivivva.com which is based around female youth active ware. With Lululemon having 12,500 full-time employees worldwide (Lululemon Athletica Inc. (LULU), 2017) with 406 stores (Lululemon, 2016), their large market capital of $8.33 billion (Lululemon Athletica Inc. (LULU), 2017), shows the total value of Lululemons shares of stock. Lululemon having $581.1 million in net revenue, this is an increase of 13% while their gross profit increased by 17% rising to $297.4 million. (Lululemon Athletica Inc. Announces Second Quarter Fiscal 2017 Results, 2017). This shows a steady increase in profit for Lululemon for 2017 which is a strength for them.
The threat of new entrants in the athletic shoe industry is very weak. Currently the market is dominated by three major competitors, and
There is a market segment that fashion brands and the public subconsciously ignore, which is the overweight people, the potential young customers who are “plus-sized”. In addition, the pricing strategy is still in relation to the purchasing power, which means it will still remain its high-end pricing in general, despite little pricing differentiation might be caused by the online & offline channel.
Companies in this industry also attempt to differentiate themselves by technical advancements in the apparel. Companies compete to find the technology that consumers believe will help their overall performance in sports and activities; whether it’s a sweat wicking shirt or lighter shoe, consumers seek the product they believe will give them the greatest advantage. Overall, the rivalry amongst competitors is a strong force that ultimately lowers the profitability of the industry.
There Is a similar relation among the clothes. Several customers shop there based on the quality and prices as well as the features associated with the products. An advantage of the store is that it has a wide product mix and various offering in different categories and all these can be located at one place. This attracts a wide variety of customers. In line with their positioning of offering quality, trendy products, the brand is consistently updating its product line. The brand does not focus on innovation but rather on always leading trends. In relation to the product life cycle, clothing has a short life span from the first to last stage as tastes change easily. For this reason, it is important to constantly anticipate consumer tastes and preferences prior to launching a product so as to retain and possibly build customers loyalty. It is also necessary to develop a successful marketing strategy to display product offerings.
The clothing industry in South Africa has always been an industry where there is intense rivalry between the companies. There are main companies in the industry namely Edgars, Woolworths Truworths, but there are smaller retail companies that enter the market that can satisfy the demand of the consumer’s better.
Industry Needs/Target Market: Under Armour’s currently markets its product to people who have active lifestyles, into sports and all things physically active. Also, it is nationally (U.S.A) driven; only in recent years as it branched out internationally. The company needs to consider another segment of the market, which is those that are only interested in a more casual look. There is a need to shift from the traditional market of performance-based apparels to a more diverse product segment of sportswear. Under Armour’s narrow focus of only considering athletes has led to a loss of customers to its competitions such has Nike; that makes both athletic and casual wears.
Moving into the SK markets presents itself as critical juncture point for any company that has attained a place in the global apparel markets. First, it will allow for companies in this position to ready themselves for entry into other Asian markets where product visibility by
The combined athletic-wear and sneaker industry is a highly competitive market. Currently, there is a low threat from new entrants due to the high number of entry barriers created by the traditionally dominant companies such as Nike and Adidas, Under Armours main rivals. Under Armour’s entry in 1996 is the most recent American brand to gain significant market share yet regardless, they still remain significantly behind their competitors in the global market (Strider).
This case study is about Under Armour, a company that deals with the manufacture and sales of all forms of sportswear and accessories. The company has had great sales in most of its products like moisture-wicking shirts and athletics shoes. Despite this, the company still holds only 5% of the market shares, trailing behind Nike, Adidas and Asics. Moreover, the company posses low financial strength such that it cannot launch multiple products in multiple categories at the same time like its competitors.