Marketing and Communication Strategy: Promotion - Case Study Example

1 Executive Summary In March 2007, H&M, the international retail fashion giant, released a new line of clothing, referred to as M by Madonna. This line was inspired by Madonna who, as a cultural icon has, herself, influenced fashion and lifestyle across the world for much of the past to decades. Involved as she was in every step of the design and production of the fashion line, M By Madonna bears the indelible mark of both H&M and Madonna. Both H&M and Madonna have far-reaching global consumer appeal and research indicates that the said line has tremendous market potential. The realisation of that potential, however, is contingent upon the formulation and implementation of a market plan as which would create consumer awareness of the brand, on the one hand, and incite the purchasing decision on the other. This necessitates the capitalisation upon both Madonna and H&M's already existent market appeal and pre-existing consumer loyalty and trust. To ensure the popularisation of the brand, it is imperative that M by Madonna engage in a marketing communication campaign designed to disseminate information about the line and to familiarise the consumer fashion market with it. The primary goal of the campaign is to increase market awareness of the line, with campaign success measured in terms of message penetration as evidenced through sales figures. The campaign will be comprised of a mix of advertising and public relations, supported with direct mail. Paid advertisements will target the defined global consumer segment and public relations, the launching of the lines in various markets. Advertising will consist of magazine, billboards (outdoor advertising) and TV. Public relations will consist of the distribution of promotion packages at the launch events, with the former being highly publicised events featuring celebrity guests. 2 Premise M By Madonna offers the trendy young consumer an entire fashion range at an affordable price. Realising the importance of dress as a statement about who one is and where one is heading, the line extends consumers the opportunity to look fashionable and expensive' without having to pay dearly for it. 3 Background Founded in 1947, H&M has grown from a small Swedish fashion outlet to one of the world's largest fashion retailers, with over 1,300 stores and operations in 24 countries. Always associated with the youth market, H&M provides both male and female fashion consumers with trendy, often jet-setting, fashions and high quality products at affordable prices (Nolan, 2006). As such, it provides the youth market with the haut couture look at retail prices. The Madonna-H&M venture is a potentially promising addition to the youth fashion market. The resultant line, M By Madonna, provides the youth consumer with an entire range of youth clothing and accessories, suitable for wear at the office, at university/school, for leisure, formal and casual occasions. It is, in other words, a highly varied, multi-purpose line. M By Madonna combines between youthfulness and elegance and, as such, provides the fashion consumer with timeless, multi-purpose and multi-occasion designs. Distributed to fashion stores across the world, not to mention H&M outlets in March 2007, the line has tremendous market potential should the campaign succeed in capitalising upon both H&M and Madonna's market reputations and consumer appeals. 4 Situation Analysis 4.1 Goals The primary goal of this communication campaign is to create consumer awareness of them by Madonna line and disseminate relevant information regarding points of purchase, whether physical (stores) or virtual (web) locations. The secondary goal is to raise the visibility level of M By Madonna, in what has often been referred to as an increasingly retail-crowded consumer market environment and to establish awareness of the line as the optimal youth fashion choice. Other goals can be expressed as follows: Positioning of the line Branding Influencing positive consumer perceptions of he fashion line, thereby inciting the purchase decision Delivering and disseminating information regarding points of purchase Linking the current line with the pre-existing market credibility of both H&M and Madonna 4.1.1 Key Message The key message of the campaign is that M By Madonna is an easily-accessible, multi-purpose and varied male and female fashion line which provides youth with couture quality clothing and accessories' design and quality at retail prices. 4.1.2 Measurable Objectives The success of this campaign will be measured through the documented increase in awareness levels, as deduced from post-campaign sales figures and number of hits on H&M, M by Madonna websites. 4.2 Market Research and Analysis Research indicates that the global fashion market is an extremely expansive one. As Nolan (2006) notes, not only is it a multi-billion dollar industry but it is one which is expecting to grow even more. As Rogers (2003) points out, growth is not just predicated on the timeless popularity of fashion per se, nor on facts and figures which evidence the continued, year after year growth of this market but, on the penetration into new markets. H&M, for example, has recently expanded into the Chinese market, as well as into several other emergent and promising ones (Nolan, 2006). Further research, however, highlights the defined market as an extremely competitive and tremendously crowded one. It is crowded in the sense that there are virtually countless fashion retailers, most of which serve the youth market (in addition to others). The implication here is that the acquisition, let alone retention or expansion of market shares, is ultimately predicted on the positioning, branding and, above, all the marketing communications campaign in question. 4.2.1 SWOT An analysis of the associate strengths, weaknesses, opportunities and threats is integral to all of accurate positioning, branding and the design of an effective marketing communications campaign. As all of the stated must emerge from within the parameters of a solid understanding of the state of the market in relation to M By Madonna, this section will present the requisite SWOT analysis. 4.2.1.1 Strengths The fashion line in question has a number of notable strengths. The first of these is the market reputation of either of the collaborators. Since 1947, H&M has been servicing the youth consumer fashion market and, besides advancing from strength to strength as measured in terms of annual profits and global market shares, is a popularly acknowledged fashion innovator. As defined by Solomon (2004), fashion leaders and innovators are those who experiment with new designs and, in so doing, create a novel fashion trend. Insofar as the fashion industry is concerned, innovation and fashion leadership are critical strengths. Added to the stated, another of H&M's strengths lies in its history of collaboration with designers/celebrities for the design and production of unique lines and affordable costs. Over the past 5 years, it entered into such collaborations with Lagerfeld and Stella McCartney (Nolan, 2006). Another important of the brand's strength's lies in the identity of the collaborator. Madonna is not just a pop star but over the past two decades has acquired a global following which runs into several millions of fans. These millions translate their loyalty and appreciation for the pop singer into purchases, whether of CDs or concert tickets. Added to that, they emulate Madonna's style of dress. The implication here is that Madonna, herself, and to the extent that she is perceived of as a fashion and cultural icon, functions as one of the fashion line's most significant strengths. 4.2.1.2 Weaknesses The primary weakness lies in the fact that the consumer market generally tends to perceive of fashion as expensive and members of the targeted consumer market, the youth, may assume that M By Madonna fashions and accessories are simply beyond their budget limitations. Another weakness lies in that the association with Madonna, as opposed to the earlier collaboration with Karl Lagerfeld, immediately limit the bounds of M By Madonna's market and locks it firmly within the youth consumer market. Expanding beyond that will be a challenging undertaking for the marketing communication campaign. 4.2.1.3 Opportunities The existent market opportunities as which may contribute to the line's success exist in the form of continued demand for fashion, on the one hand, and the ever-increasing demand for high quality brand names at affordable, or non-couture prices. 4.2.1.4 Threat There are two potential threats to the marketing communication campaign's success. These are quality and design expectations, with the implication here being that if expectations are raised too high so that, when they do come across M by Madonna items, consumers feel that the reality does not meet expectations. In such an instance, they may feel that they the campaign was founded on misinformation and, accordingly, may not purchase M By Madonna items. The second threat lies in that the initial campaign budget may not be sufficient for the creation of long-term brand awareness among global consumers. 4.2.2 Consumer Market Segmentation Since the pioneering research of Wendell Smith (1956), the concept of market segmentation has been one of the most pervasive activities in both the marketing academic literature and practice (Desarbo and Grisaffe, 1998; Alfansi and Sargeant, 2000). Smith argues that segmentation is based upon the development on the demand side of the market and represents a rational and more precise adjustment of product and marketing effort to consumer or user requirements. One standard definition of market segmentation is (Sommers and Barnes, 2003): "market segmentation divides the total heterogeneous market for a product or service into several segments, each of which tends to be homogeneous in many significant aspects." Segments are defined as groups showing some patterns of similarity and that differ significantly in their response to communications, product positioning and product configuration, in synthesis, to the relevant marketing variables (Sommers and Barnes, 2003). According to the marketing literature, segmentation helps organizations to identify market opportunities and improve the allocation of resources, assists in the development of a suitable competitive position and ultimately leads to more satisfied customers (Wind, 1978). The methods for forming segments can be a priori or post hoc, and descriptive or predictive (Wedal and Kamakura, 2000). A priori methods are procedures where the type and number of segments are determined in advance. An example is grouping customers based on whether their income level is high or low. Post hoc methods are those in which the data indicate the number and type of segments (Wedal and Kamakura, 2000). The current marketing plan will adopt an a priori approach to market segmentation for two reasons. The first is that it facilitates the formulation of a marketing/communications campaign which specifically speaks to the targeted segment. In the second place, it is both more time and cost effective than ad hoc segmentation (Wedal and Kamakura, 2000). Proceeding from the above stated and bearing the nature of both the good itself and the message, the targeted group will be university students and young executives. This group tends to be fashion-conscious, lean towards brand names, have a limited clothing budget and form the bulk of both Madonna fans and H&M customers. For the said reasons, the campaign will target them. 5 Branding In our lives we are surrounded and inundated by brands: Sony, Google, Toyota, Cadbury, Pepsi, Coke, just to mention a few at random. Brands seem to be part of our everyday life; actually, there is no part of life that is not somehow penetrated by brands. But what are brands What do they mean Or, do they mean anything What does it matter if I drink Coke instead of Pepsi Brands are somehow related to products and services yet seem to have a distinct existence. By and large, brands seem to carry some meaning, or at least something. Some brands, such as H&M, act like an umbrella for a wide variety of different products and brands. At the same time, other brands are very specific to the product or service they identify, such as Nescafe. In either case, brands serve a variety of tasks which help the consumer. They: Identify a product, Reduce risk, Signify quality Provide symbolic information And they also assist manufacturers to: Identify and simplify product handling, Legally protect unique features, Endow product with unique associations, Increase competitive advantage, Increase financial returns (Keller, 1997, p. 7). Each of these individual functions is of course linked and thus merely a facet of the whole set of functions. According to Keller (1997), consumers benefit from branding in terns of easier recognition, reduction of risk, lower search costs for quality as well as some type of symbolic data. Symbolic information is sometimes referred to as positioning. The exact nature of this symbolic information remains unknown, and is referred to as non-product related association. On the other side, the brand owner is posited to be able to exploit the powers of branding by differentiating a product, legally protecting it, and imbuing it with signifiers of quality and certain associations, which all should increase the monetary returns. As Aaker (1992) notes, efficient management of the brand seems to enable the owner to reap extra profits, stabilize a customer base, and finally reduce risk. Consequently, it is this series of tasks and functions that circumscribe the existence and legitimization of branding. It is inside this framework that Keller attempts to formulate a concept of brand into a coherent category, which he refers to as brand equity. Proceeding from the above and, again, bearing in mind the brand's explicit and implicit associations, branding will focus on the presentation of the said fashion line as Couture quality for non-couture prices The choice for successful, trending youth It is also, thus, that M By Madonna will be position in the youth fashion market as the brand to turn to for the communication of a statement about one's own self as an ambitious, modern, successful and fashionable person. Branding, in other words, will focus on the positioning of M By Madonna as the fashion line to turn to for, not just one outfit nut for a power, party, casual and formal wardrobe. 6 Marketing and Communication Strategy: Promotion As may be understood from the preceding, the marketing strategy and communications campaign has a set of very clear aims to achieve and very well-defined obstacles to overcome. It must communicate a message which effectively informs and persuades the target audience that M By Madonna provides consumers with an extensive range of fashion products, which are designed with the targeted segment's budget and fashion needs, tastes and demands in mind. To achieve this specified aim, M By Madonna's communication/promotion campaign must not simply launch advertising and marketing campaign but needs to further undertake an information campaign. According to Young and Aiken (2007), while advertisements do influence consumer perceptions and buying habits, many consumers are sceptical of advertising campaigns, dismissing messages as unsupported "weasel words." For M By Madonna to achieve its objective, therefore, the tone of its campaign needs to be friendly, serious, trustworthy, although fun, facilitating believability. 6.1 Below the Line Marketing The campaign needs to use marketing tools in such a way that would both promote the benefits (statement wearer makes) of purchasing M By Madonna fashion items, while simultaneously focusing on the price variable. Thus, while ensuring that price level factors in cost, demand, competition and perceived value, M By Madonna must constantly monitor both the targeted segment's and competitors' reactions to its prices in order to attain a competitive balance between the cluster's average budget and market expansion and profit increase targets. Thus, it must apply a price-value balance model here and the marketing communication mix should communicate the characteristics of that balance. Therefore, in response to theories stating that buyer decision-making is primarily influenced by perception of desirability measured in subjective terms of pleasure to be derived from purchase and use, promotion and advertisements must focus upon marketing the line itself in terms of rational utility (Young and Aiken, 2007). Additionally, M By Madonna should promote sales through the automatic entrance of buyers into competitions. 6.2 Direct Marketing Smith and Taylor (2004) emphasize the tremendous value of a well-designed and effective direct marketing campaign, further stressing that the most successful and effective ones are those that rely on creativity and not on set strategies. While flyers and door to door informative advertisements do attain results, these results are limited due to two important reasons. In the first place, they have been used so much that the targeted groups hardly react to them. In the second place, they are used by so many marketers that targeted consumers often receive a significant amount of flyers and information sheets promoting a new product per week that they just throw them all out (Smith and Taylor, 2004). Accordingly, instead of using the traditional methods of direct marketing, more innovative approaches should be used. For instance, members of the target group should be drawn into the marketing process through contests and surprise shopping sprees. In other words, the objective approach to direct marketing, which is the most commonly used one according to Smith and Taylor (2004) needs to be disregarded in favour of a more subjective approach which puts randomly selected members of the targeted cluster at the centre of the direct marketing campaign as participants. This particular strategy for direct marketing should be composed of several innovative and creative ideas and scenarios, such as those stated in the above. Read More