Marketing Management project on jeans

Marketing Management Case Study : Jeans 8/1/2012

K J SOMAIYA INSTITUTE OF MANAGEMENT STUDIES & RESEARCH

INTRODUCTION Jeans are now a very popular form of casual dress around the world, and have been so for decades. They come in many styles and colors; however, "blue jeans" are particularly identified with American culture, especially the American Old West. Jeans are trousers made from denim. Often the term "jeans" refers to a particular style of pants called "blue jeans" and invented by Jacob Davis and Levi Strauss in 1873. Starting in the 1950s, jeans, originally designed for cowboys, became popular among teenagers, especially members of the greaser (subculture). Historic brands include Levi's, Lee, and Wrangler. Jeans come in various fits, including skinny, tapered, straight, boot cut and flare.

.

The history of jeans Denim and jeans - where do the names come from? The word jeans comes from a kind of material that was made in Europe. The material, called jean, was named after sailors from Genoa in Italy, because they wore clothes made from it. The word 'denim' probably came from the name of a French material, serge de Nimes: serge (a kind of material) from Nimes (a town in France). The 18th century At first, jean cloth was made from a mixture of things. However, in

PLANTATION: (n) a

the eighteenth century as trade, slave labour, and cotton plantations

large farm where a

increased, jean cloth was made completely from cotton. Workers

single crop is grown

wore it because the material was very strong and it did not wear out easily. It was usually dyed with indigo, a dye taken from plants in the Americas and India, which made jean cloth a dark blue colour.

DYE: (v) to change the

colour

something. chemical change

of

(n)

a

used

to

something's

colour The 19th century – The California Gold Rush In 1848, gold was found in California (not too

WHOLESALE

far from San Francisco) and the famous Gold

BUSINESS

Rush began. The gold miners wanted clothes

buying large amounts

that were strong and did not tear easily. In 1853,

of

a man called Leob Strauss left his home in New York and moved to

selling it to shops

San Francisco, where he started a wholesale business, supplying clothes. Strauss later changed his name from Leob to Levi.

something

(n)

&

Rivets A big problem with the miners' clothes were the pockets, which

RIVET: (n) a strong

easily tore away from the jeans. A man called Jacob Davis had the

metal fastener

idea of using metal rivets (fasteners) to hold the pockets and the jeans together so that they wouldn't tear. Davis wanted to patent his idea, but he didn't have enough money, so in 1872, he wrote to Levi Strauss and offered Strauss a deal if Strauss would pay for the patent. Strauss accepted, and he started making copper-riveted 'waist overalls' (as jeans were called then). In 1886, Levi sewed a leather label on their jeans. The label showed a picture of a pair of jeans that were being pulled between two horses. This was to advertise how strong Levi jeans were: even two horses could not tear them apart.

PATENT: (v) if you patent something it is legally your invention and

other

people

cannot steal it. OVERALLS: (n) a loose fitting garment that covers the legs and chest

How jeans became popular

The 1930's: Westerns In the 1930's, Hollywood made

DUDE RANCH: (n) a

lots of western movies. Cowboys

holiday resort in the

- who often wore jeans in the

western

movies-became

popular.

people can ride horses

Many Americans who lived in

and pretend to be

the eastern states went for vacations on 'dude ranches' and took pairs

cowboys

very

US

where

of denim 'waist overalls' back east with them when they went home. The 1940's: War Fewer jeans were made during the time of World War 2, but 'waist

OFF DUTY: (v) time

overalls' were introduced to the world by American soldiers, who

when a soldier is not

sometimes wore them when they were off duty. After the war, Levi

working

began to sell their clothes outside the American West. Rival

RIVAL:

(n)

companies, like Wrangler and Lee, began to compete with Levi for a

something

share of this new market.

competition with you

in

The 1950's: Rebels In the 1950's, denim became popular with young people. It was the

BAN:

symbol of the teenage rebel in TV programmes and movies (like

order people to stop

James Dean in the 1955 movie Rebel Without a Cause). Some

doing something

schools in the USA banned students from wearing denim. Teenagers called the waist overalls 'jean pants' - and the name stayed.

(v)

forbid;

The 1960's: Hippies & the Cold War In the 1960's many, many university and college students wore jeans. Different styles of jeans were made, to match the 60's fashions: embroidered jeans, painted jeans, psychedelic jeans... In many non-western countries, jeans became a symbol of 'Western decadence' and were very hard to get. US companies said that they often received letters from people all around the world asking them to send the writer a pair of jeans. The 1980's: Designer Jeans In the 1980's jeans finally became high fashion clothing, when famous designers started making their own styles of jeans, with their own labels on them. Sales of jeans went up and up. The 1990's: Recession Things changed in the 1990s. The rock-and-roll generation gave way to the hip-hop crowd. Blue collar made way for the white. The craze for jeans began to fade. For the dot-com dudes, the sartorial key was khakis. Denims made way for Dockers. A company that once had a 90 per cent of the market and made 90 per cent of its jeans in the US started to fray. Today it has branched out to khakis and other apparel and it now parcels out 90 per cent of its production far and wide so that it can have a leg up on the fast evolving market.

LEVI’S Parent Company : Levi Strauss & Co. Category : Apparel and Footwear Sector : Lifestyle and Retail Tagline : Go Forth USP : The brand id known for its denim apparels especially jeans. It is the oldest manufacturing company of jeans.

STP Segmentation : Target : Positioning : SWOT Analysis Strengths : The main strength of Levi’s is its popularity. It is a globally recognized brand all over the world. Competing prices with the rivals. Variety of products like T-shirts, bags, shoes, jackets make the company more profitable. Weakness : They only focus mainly on youth that makes company weaker in marketing areas. Losing market to newer and more trendier brands. Opportunity : The company has more than 5000 trademark registrations and pending applications in more than 180 countries. The company’s products are sold in more than 60000 outlets and in around 110 countries worldwide. It is registered in more than 160 countries. Threats : Brands like pepe, lee, and others create tough competition. The choice of youth keeps on changing, so a company solely targeting youth needs to

innovate a lot.

SPYKAR Parent company : Spykar Category : Apparel and accessories. Sector : Lifestyle and retail. Tagline : Bring it on. USP : The brand id known for its denim apparels especially jeans.

STP Segmentation : Men and women loving denims and western comfortable clothing. Target : Young men and women from the urban areas. Positioning : With culture.

SWOT Analysis Strengths : 1. The company is an Indian denim brand and hence has an Indian mass appeal. 2. The company has strict code of conduct and quality with almost negligible attrition rate. 3. The company has an in-house processing unit giving the company the competitive edge in consistently producing quality denims 4.SPYKAR is available at over 450 MBOs across the country, apart from the large format stores like Shopper's Stop, Globus, Lifestyle, Pantaloons etc. and the exclusive outlets.

5. The brand also has a stylish website giving complete information relating to its products, campaigns and stores. Weakness : 1.The brand has tough competition and there is high brand switching 2. Limited global presence as it restricted to a small market. Opportunity : 1. With 100 per cent FDI in single brand retail getting the nod and 51 per cent in multi-brand likely to happen, Spykar can benefit. 2. The Company can do aggressive marketing in colleges and youth events. Threats: 1. Similar designs available in other brands hence switching cost is less. 2. Local market and international brands poses a risk.

Competitors 1.Levis 2. Pepe 3.Wrangler

3. PEPE JEANS History In 1973 it was originally just a weekend road side stall on the Portobello Road Market located in west London established by three brothers: Nitin Shah, Arun Shah and Milan Shah. Nitin and his two brothers later started their own company Sholemay Ltd trading, as Pepe Jeans. Parent company : Pepe Jeans Incorporation. Category : Apparel and accessories. Sector : Lifestyle and Retail Tagline : Pepe Jeans London. USP : A brand, which is really innovative, stylish changing with variety at an affordable price. STP Segmentation : Men and women who like contemporary style of fashion with a rebellious attitude. Target : Young urban Men and women from the upper middle class. Positioning : Pepe Jeans is a premium and international brand, which houses casual wear with a heart of London in it.

SWOT Analysis Strengths : 1. Pepe Jeans is present over 100 countries and employs more than 5000 employees all over the world. 2. The brand is the fastest growing denim brand and is 500 million denim and casual wear brand. 3. The brand had a different view of selling jeans and was against hanging them and even fought with the retailers to change this fashion, which was a big hit. 4. The brand has entered the elite segment of the top four denim producers in the world. 5. The brand has always been constantly producing unique silhouettes, which the brand is very famous for across Europe. 6. The brand uses extensive advertising where the brand often teased the boundaries of acceptable social imaginary and norms, which had a big attraction among young consumers. 7. The brand has a heavy brand following and is has a strong financial position in the denim industry. 8. The brand has signed international celebrity brand ambassadors which enhances the brand equity. Weakness : 1. Constantly changing fashion trends means inventory issues 2. The brand has several competitors hence high brand switching. Opportunities : 1. The brand should expand its products and services throughout the world. 2. The brand can enter into the kid’s wear segment.

Threats : 1. Switching cost between brands is very low, so there are regular price wars among competitors. 2. Increasing Competition from brands like Lee, levis is increasing never like before.

Competitors 1. Lee 2. Levis 3. Wrangler

Wrangler Parent Company : VF Corporation Category : Apparel Sector : Lifestyle and Retail Tagline : There's a bit of the West in all of us. USP : Comfort and style at affordable rates.

STP

Segmentation : Casual wear Target : Men and women from the urban upper middle class Positioning : Tough and rugged, lasting quality.

SWOT Analysis Strengths : 1. Wrangler has a wide distribution channel. They sell their jeans at mass merchandisers such as Walmart and Target. 2. They also have their own flagship specialty stores located at many places. 3. Strong brand presence 4. Good marketing and advertising at stores and print ads. Weakness : 1.Competition from standalone specialty stores means limited market share growth 2. Lot of options available means high brand switching. Opportunity 1. Denim industry is expected to grow at a faster rate 2.Companies are using new media to reach consumers 3. More global penetration and enhanced visibility. Threats 1. With increased interest in their own flagship brands mass merchandisers like Walmart are beginning to decrease shelf space allocated to these premium denim brands. 2. Increasing competition 3. Fluctuating currency values and economic scenario.

Competitors

1. Levis 2. Lee 3. Pepe Jeans

KILLER Parent company : KewalKiran Clothing Limited Category : Apparel and Accessories Sector : Lifestyle and Retail Tagline : Worship the night, Killer for her; What’s your cut? USP : India’s first international denim brand.

STP Segmentation : Fashion conscious and trendy youth Target : Youth from the Urban upper and upper middle class. Positioning : Denim brand with an attitude.

SWOT Analysis Strengths : 1. Strong brand presence with over 1600 points of sale in the form of MBO’s with chains a. like Shopper’s Stop, Central, Lifestyle and their exclusive brand outlets like Klounge in all Tier-1 cities. 2. Diversification into other product line like Killer Tees, innerwear, footwear, eyewear

to make it a complete lifestyle brand. 
3. Innovative ad-campaigns have made a strong connect with the youth which is their main target audience.
4. Brand has been termed as India’s first international denim wear brand with it exporting denim wear to Middle East, USA, Africa, South-East Asia since 1994. 3. Self-procurement and manufacturing facilities has been a great strength for the brand as it 5 units with an annual capacity of over 30 lakh pieces. Weakness

1. Though the brand has stretched its portfolio with many diversifications it still has to heavily depend on denim wear for its revenues.
 2. The brand is facing increasing competition from the other sibling brands of the parent company like Lawman and Integriti which too are emerging in denim wear. Weakness 1. Though the brand has stretched its portfolio with many diversifications it still has to heavily depend on denim wear for its revenues.
2. The brand is facing increasing competition from the other sibling brands of the parent company like Lawman and Integriti which too are emerging in denim wear. Opportunity

1. The company can look to expand its manufacturing capabilities in emerging markets which would be a great boost for the brand.
 2. The brand can also start online stores for selling its merchandise as it has emerged as an effective medium for selling. 
 3. The brand effective in its advertising can also look at green campaigns which is attracting a lot of attention these days. Threats 1. The government tax policies on apparel are set to increase the unit cost.
 2. Highly fragmented fashion industry which would involve low customer loyalty.
 3. The entry of several international players in the retail industry after opening up of FDI

would also pose as a threat for the brand. Competitors 1. Pepe Jeans 2. Levis 3. Diesel

Market Share Now let us see the market share of the above brands in India.

The Market Share for Levis is the highest i.e. 49%, followed by Pepe at 14%. Other brand includes UCB, GAS, Flying machine, etc.

Market Share based on Gender :

Average rating :

Brand Loyalty In the end looking at all the brands and considering the brand loyalty of all the brands, we can

conclude that Levis has the highest brand loyalty.

Bibliography http://en.wikipedia.org/wiki/Jeans http://en.wikipedia.org/wiki/Pepe_Jeans