Market for Levis Jeans - Business Plan Example

Table of content S.no Topic Pages Executive summary 2 Introduction 2 Background 2.2) purpose and objectives 2 3 Environmental analysis 2 3.1) demographic, cultural and social 2 3.2) political 3 3.3) Economical 3 3.4) technological 4 4 Market 4 5 Competitors 4 5.1) competitive comparison, SWOT 5 6 Marketing objectives 6 7 Marketing strategies 7 7.1) supply strategies 7 7.2) demand strategies 7 7.3) Positioning strategies 8 7.4) competitors strategies 8 8 Marketing mix 8 8.1) Product 8 8.2) price 8 8.3) place 8 8.4) promotion 9 9 Implementation and control 9 10 conclusion 9 1) Executive summary Levi Strauss & Co. is a global company with its operation in more than 110 countries. The company specializes in the manufacturing of wrinkle-free and stain-resistant jeans. The company gives great value to its customers and employees. The environmental analysis of the company is based on both micro and macro environmental factors. USA has a mixed group of people with different ethnicities, thus the environment there favors the company. The number of immigrants is increasing which has increased the number of customers for the company. The company focuses on teenagers mainly within the ages of 18-25 thus the jeans, pants and other products are all designed keeping the latest trends and fashions in mind. The company has the mission of clothing the world and wants to be the leader in the industry. It has set up proper channels for purchasing, manufacturing, stitching, distribution, and marketing. The internal environment has many strengths and weaknesses and external environment defines many opportunities and threats. The marketing objectives of the company have taken into consideration all the 4Ws (what, when, how, where) and the strategies have been made in all the channels from purchase of raw material to its distribution to customers. The company keeps a track on every step as to maintain credibility in eyes of customer. The product is well designed, easily available to customer; the customer can easily purchase the products from Levi outlets which are easily accessible and in many corners of the country. 2) Introduction 2.1) Background Levi Strauss & Co. is a private company known worldwide for its denim jeans. The company has divided its operations into three geographical locations; Levi’s Strauss Americas, Levi’s Strauss Europe, Middle East and Africa and Asia Pacific Division. It has its head quarters in San Francisco, California, US. The company specializes in denim wear; it also works in the line of casual and street fashion. It has sales in 110 countries and based on the 2008 census, Levis has generated revenue of US$ 4.303 billion (Hoovers, 2010). It sells jeans and sportswear under the names of Levi’s, Dockers and Levi Strauss Signatures, along with men and women’s underwear and loungewear. The company specializes in the manufacturing of wrinkle-free and stain-resistant jeans. 2.2) Purpose and objectives The purpose and objectives of Levi’s Strauss & Co. are to retain existing customers and add new customers, increase market share of the company and the revenues generated in the next 2-3 years, increase the product line and add new varieties to the already existing ones, try to be the market leader in the industry In order to achieve these purposes and objectives the company analyzes both the external and internal environments and regularly identifies marketing strategies to bring success by achieving desired goals. 3) Environmental analysis The environmental analysis of Levi Strauss & Co. is based on both macro and micro environmental forces affecting the company. 3.1) Demographic, cultural and social The United States has a total population of 308,984,000 (US consensus bureau). California and Texas are the most populated states. The population growth is highest amongst other industrialized countries as the immigration rate is high. Quarter of the population is under the age of 20 and 1/8 of the people were of age 65 and over in 2007. United States is the combination of people from different races and ethnicity. The different races in USA include Whites, Hispanic or Latino, Black or African American, Asians, American Indians, Hawaiians and Pacific Islanders. Equal rights are given to both men and women and they both have leading roles in the society. Education system also provides equal opportunities for both male and female and they both have equal chances of selection, increments and work place. 3.2) Political USA is a developed country with a strong and stable economy. It has a conducive investment environment. It has a presidential, federal republic system of government. The government is strong and favours a healthy environment. There are 87000 local governments and 3034 countries. About 28% of the people live in cities. The citizens are allowed to vote at age of 18 and above. The United States emphasizes on democracy, equality before the law, freedom of religion, separation of church and state and freedom of speech. 3.3) Economical The GDP is estimated to be $14.2 trillion in 2009. The population growth rate is 0.977% (2009 est.). The migrants are 4.32 migrants/1,000 populations (2009 est.). Financial sector is growing. Construction is on the rise. Its exports include agricultural products (soybeans, fruit, and corn), industrial supplies (organic chemicals), capital goods (transistors, aircraft, motor vehicle parts, computers, telecommunications equipment) and consumer goods (automobiles, medicines). Its imports are agricultural products, industrial supplies (crude oil), capital goods (computers, telecommunications equipment, motor vehicle parts, office machines, electric power machinery) and consumer goods (automobiles, clothing, medicines, furniture, and toys). 3.4) Technological Modern technology is available including fibre optic telecommunication and internet. ATMs are conveniently available to all and debit and credit cards are used on every day purchases. 4) Market The USA market comprises of government, public sector bodies, corporate entities, insurance companies, professionals, public servants, teachers, and the residents. The market growth rate is high and market population by ethnicity is; Whites Asian American Hispanic African American 70% 5% 13% 12% USA has a huge market for the Levi Strauss and Co., as the user of the products or market is big and increasing. The Levi’s jeans are worn by all age groups and all ethnicities. The demands for the products are increasing. The frequency of purchasing the jeans is lower but this would not affect the company due to the huge market. The company focuses on the scenario that people like Levi clothes and trust the brand so it markets and distributes the most attractive and widely worn outfits which all define style, quality and function. Thus Levi has a mission of clothing the world. 5) Competitors Today effective business requires good marketing and effective merchandising, which is conducted by Levi’s Co. it offers a wide variety of clothing including jeans and have advantage in setting proper channels for purchasing, distribution, and marketing. Today small stores are challenging by offering unique merchandise, targeting a specific demographic, providing superior customer service and serving a local market. The industry is filled with many companies all using different strategies to attract customers. The industry in which Levi Strauss and Co. competes is in men’s clothing, retail, apparel and accessories retail, non store retail, internet retail and consumer products manufacturers. The main competitors of Levi’s jeans are, 1. Industria De Diseno Textil SA based in Arteixo, La Coruna 2. The Gap Inc. in San Francisco 3. V.F. Corporation in Greensboro. 5.1) Competitive comparison The SWOT for Levi’s Strauss and Co. is as follows; Strengths Levi Strauss supplies right products with superior quality and reliability, vs. competitors Superior clothing fulfilling the present fashion needs, Some staff have experience of end-user sector, have customer lists, direct delivery capability, product innovations ongoing, Easy availability of products due to a number of outlets in many areas, Management is committed and confident. Weaknesses Levi Strauss is a huge Co. with its operation worldwide, despite its advancement in use of technology and IT facilities there could be weakness in some areas due to huge span of control. As the company sells in many sectors including jeans, sport wears’ etc. there could be a reduced flexibility of some of its attentive competitors Although the company is global but in few countries worldwide it has less presence. Opportunities Levi Strauss & Co. develops new products with continuous improvement meeting the customer needs Profit margins are good and end-users respond to new ideas Can surprise competitors, Support core business economies and could seek better supplier deals. Threats Environmental effects can favor larger competitors, Existing core business distribution risk, possible negative publicity. 6) Marketing objectives The marketing objectives of Levi Strauss & Co are based on the following 4W’s; 1. What Levi’s objective is to price its products at the product–quality leadership level in the market for clothing. This objective is defined for the global market/ global customers. The styles are based on modern trends in the industry. 2. Why The external pressures on the company are the macro environmental threats, extent of competition in the local and international market, legal regulations including trade policies, tariffs and government regulations, societal reactions towards the prices of clothing and the market demands. 3. How The clothing items of Levi Strauss & Co. are priced higher which represent their high quality, use of finest raw materials and uniqueness in its own kind. In simple words the high prices support its high value thus targeting a group of customers. The treads, wool fiber, linen and cotton used are carefully chosen from varieties of animal, plants, mineral and synthetic textiles. There is always a demand for fine clothing worldwide thus prices are set up accordingly both higher and lower. Levi Strauss & Co. has a position in the market and along with promotion strategies and programs the brand will favor customer perceptions in the following years. 4. When and where The company’s products are available worldwide in variety of colors, prices, and styles. Based on the demand for the products, which are usually very popular amongst the teenagers who always run behind fashion lines it is gradually innovating with time to fulfill customer needs. 7) Marketing strategies 7.1) Supply strategies Levi will develop new supply strategies which will allow the customers to purchase the brand at lower prices. 7.2) Demand strategies The company will target teenagers between the age of 18 to which are more fashion conscious and need trendy clothes. And secondly the strategy will be to achieve product differentiation and competitive advantage in the market. 7.3) Positioning strategies Levi aims to reach to the top position for the products offered through innovative product development and competitive advantage in the market. 7.4) Competitors strategies Levi’s is increasing the number of outlets worldwide in order to increase their product reach ability to customers. The staff is trained regularly to improve their services and novel techniques and styles are adopted to provide trendy and superior quality clothing. 8) Marketing mix strategies 8.1) Product The company will target the teenagers between ages of 18-25 and provide them with varieties of jeans and other clothing’s at good prices with discount coupons and chance of free of charge alteration of goods. The products could be replaced but not returned back within next 1 month. 8.2) Price The prices will be fixed for products and would not be changed in case of any customer. Membership cards would be provided to loyal customers with a fee, the customers carrying the membership could avail 10% discounts on their next time purchase. 8.3) Place The Levis outlets will be available near to your homes and work places throughout the country. In addition they will also be available online if you want to make purchases and products will be delivered to home with added delivery charges. 8.4) Promotion Customers will be e-mails of the new fashions and styles of the brand available or upcoming in the market. They will be called for their comments and the products will be advertised on the company’s webpage. Furthermore adverting program will be developed to target the selected group of customers. 9) Implementation and control The implementation of these plans would require following steps; obtaining the owners approval, contact the advertising agency and formulate an advertising plan, train regularly the sales item, provide them with job description and projects, increase product variety and line and increase advertising budget of the company. Finally the control would be incorporated including performance evaluation of employees, salaries and incentives will be provided to them and financial results will be measured against the projections. Corrective actions will be taken. 9) Conclusion Levi’s Strauss and company face various situations and challenges every day but their motto of achieving their goals and objectives remains strong. The plan has detailed its external and internal environments and identified the strengths, weaknesses, opportunities and threats. Further studies are being made to identify their marketing objectives and strategies but the most the important aim remains to achieve the desired success. The company is aiming to implement and control its mission and plan which can lead Levi Strauss & Co. further ahead and make them a market leader. Work cited 1. Lynn Downey, Levi Strauss & Co., A short biography, 2008. 2. Levi Strauss & Company, An official website, http://www.levistrauss.com/ 3. Levi Strauss & Co. company profile from Hoovers, retrieved 2010-03-16, http://www.hoovers.com/company/Levi_Strauss__Co/cftkxi-1.html 4. James Sterngold, Levi Strauss Offers To Pay A Dividend To Workers, The New York Times, 13 June 1996. 5. Marketplace: Levi’s may be dressed up to go to public, July 11, 2007, retrieved 2010-03-16. http://marketplace.publicradio.org/shows/2007/07/11/PM200707114.html 6. Ford, Carin T., Levi Strauss: The Man behind Blue Jeans (Famous Inventors), Enslow Publishers. ISBN 0-7660-2249-8. , April 2004. 7. Roth, Art, The Levis story.  8. Van Steenwyk , Levi Strauss: The blue jeans man, Walker & Company, ISBN 0-8027-6795-8, June 1988. 9. U.S. Census bureau, http://www.census.gov/ 10. Levi Strauss & Co. Annual report 2008, http://www.levistrauss.com/Downloads/AR_2008.pdf Read More