IT Innovators from InformationWeek - Essay Example

 Levi’s Strauss & Co. is provided as the number three innovator at InformationWeek for the company’s innovations related to using social media to improve visibility and sales volumes. The IS strategy involves taking elements of Facebook so that customers can discuss their favorite or non-favorite elements of specific Levi’s purchases and give their opinion about product, service, and quality. At the same time, Levi’s use of this new social networking feature gives the business more marketing visibility and a competitive advantage over other similar clothing manufacturers.

Because social media is becoming mainstream across the world in multiple countries, these new blogging features give international consumers the ability to become part of the Levi’s Strauss family of products, thus appealing to their current sociological needs. The goal is to create new intimate relationships with multiple consumer demographics in a way that has not been done with other competing companies with technology as the support foundation for this effort. Porter’s Five Forces model indicates the barriers and/or influencers from the external environment that directly impact business strategy or potential profit success.

Levi’s has a considerable volume of competitors, therefore there are always risks to ensuring competitive advantage. In this case, buyers have considerable buying power because of the high volume of retail clothing competition and can easily defect to other brands if marketing-based loyalty cannot be built. In the case of Levi’s buyers are not fragmented markets, therefore they can easily threaten to buy competing products and defect to other brands, something identified by Porter as a genuine business threat (quickmba.com, 4). By giving the brand new visibility in the social media environment, they remove some of this threat by building consumer loyalty for Levi’s and differentiating the product/brand in the process.

Porter’s Five Forces model also indicates a threat to business success related to substitute products. Levi’s faces the constant threat of changing consumer attitudes and fashion trends, therefore by adding Facebook elements to the online sales environment, they can constantly update their merchandise. Substitute products could include replacing jeans for dress clothing, therefore the social media outlet gives the business the opportunity to use models in a variety of lifestyle scenarios in an environment that has become mainstream for its key market demographics.

Rather than focusing on price as a differentiation tool, the business can use its new and rather trendy Internet presence to remove customer attention from pricing and instead allow them to focus and brand identity. This is especially important during a period where the country and in some cases the world is experiencing a recession and customers’ price sensitivity is considerable higher than in normal periods of financial prosperity. Levi’s innovations in this area have brought the company much more revenue successes and allow the firm to build much stronger and long-term relationships with its desired target audiences.

The low cost nature of Facebook links to the sales environment also satisfy profit expectations and operational costs in the process. Works Cited Quickmba.com. “Porter’s Five Forces – A Model for Industry Analysis”. Accessed October 4, 2011 at http://www.quickmba.com/strategy/porter.shtml