COS Australia Company Marketing - Case Study Example

Student Name: Tutor: Title: COS Australia Course: Executive Summary This is a marketing report for COS Australia swimsuits for kids that explore the effectiveness of its launch and commercialization. The report begins with introduction that entails introduction to the report, background context, industry background, and introduction to the new product and the background of the COS Australia company. The introduction provides a brief summary into the report, the company and the new product. The situation analysis provides a detail review of the ability of the company to develop and launch the swimsuit through SWOT analysis, Ansoff Growth Matrix, Porter five forces, Segmentation, targeting and positioning strategies. The final part of the report comprise of branding strategies, product strategies, pricing strategies, promotion strategies, distribution strategies as well as the recommendation and conclusion part. Table of content Executive Summary 2 1.Introduction 4 2. Situation Analysis 5 SWOT analysis 5 Ansoff Growth Matrix 7 Porter five forces 8 Segmentation, targeting and positioning strategies 8 3. Final section: 9 a.Branding strategies 9 b.Product strategies 9 c.Pricing strategies 9 d.Promotion strategies 10 e.Distribution strategies 11 f.Recommendations and conclusion 11 References 12 1. Introduction COS Australia is a new consumer product that has to be reviewed for the effectives of its product launch as well as a commercialization. The report discusses special swimsuit for kids aged 10 to 13 years that can be won inside other clothes. Swimsuits for kids that can be worn as under clothes are rare in the fashion industry. They do not retain water and can be worn back after a session of swimming by the kids. It is important to explore the competitive positioning of the product so that it may successful compete with other established brands in the market (Zimmerman & Blythe, 2013). COS is a fashion brand targeting women and men who desire functional, modern, considered design. Swimsuits for kid will follow the supply chain for established products of the company that are already in the market. Background context COS brand developing swimsuits for kids has to penetrate both new and existing fashion markets and gain a market share. Swimsuits that are available in the market are heavy and cannot be worn as undergarments hence have to be carried separately when going swimming. The material is a mixture of polyester and nylon that ensures easy draining without making the wearer wet. After hours of swimming the swimsuits can be rinsed and won back by the user. The fashion industry is very competitive (Sahaf, 2008). Market research and scanning will reveal the likability of the product in the market and the company to meet the needs of customers. Prior to the launch, aggressive promotion and advertising has to be done to ensure that enough awareness is created about the new swimsuits. Industry background The clothing industry has faced several challenges over the years with cautious consumer spending, intense competition as well as higher rent costs impacting the overall profit and revenue. However, the industry revenue is expected to grow in the coming years. The growth is attributed to online sales channel that have been developed by brick-and-mortar retailers. Economic uncertainty in the recent past has forced consumers to be extra cautious on their spending. The improvement of economic conditions as well as the widespread use of online shopping supports revenue growth in the clothing industry in Australia. COS Australia brand developing special swimsuits for kids comes at the right time when the industry is experiencing growth (Riefler, 2012). American brands, English brands, Italian brands and Australian brands bring competition in the fashion industry in the local and international markets. COS Australia has entered the Australian market and promises to bring with it the competition that is visible in the fashion industry. Introduction of COS and company background Cos is a brand that is registered under the H & M Group which has its head office in Stockholm, Sweden. H & M Group is a multinational company fashion and design that has branches across several countries. COS Australia is a fashion design brand that has been introduced to target the Australia Fashion market. The Special swimsuits for kids are a unique product that is being introduced in the Australian market. The fashion industry in Australia is competitive and requires the industry players to work hard to establish their new brands of products in the market. 2. Situation Analysis SWOT analysis Strengths COS Australia brand of products bring freshness into the Australian market. The company is big and has the resources of pushing the swimsuits for kids into the market through a vigorous and well-developed marketing campaign. Swimsuits for kids are unique and the company will have an opportunity of presenting the product as new and fresh in the market. COS Australia is already an established brand and the special swimsuits for kids will ride on the previous product promotion to reach to the target market. Affordability will be used a strength over the competitors since established brands Armani, Denim, and David Jones designs are expensive and unaffordable to other customers in the market (Barrow & Mosley, 2011). Weaknesses The Australian fashion industry is experiencing slow growth due to cautiousness of the consumers who have experienced economic uncertainty before. The slow growth in economy is affecting the purchasing power of the consumers. The company has to rely on existing supply chain to reach the special swimsuits for kids to the target customers. Opportunities The fashion and design industry is dynamic and COS Australia will depend on this to meet the emerging needs of the customers. Consumers look out for something that is new, durable, affordable and stylish. The special swimsuits for kids will present these qualities for COS Australia. They are stylish, new and affordable. There is potential for growth due to improving economy and consumer spending. Most leading brands target the exclusive high-end market that consists of people with a huge income and purchasing power (Barrow & Mosley, 2011). COS Australia special swim suits for kids will target both high-end markets and low-end markets and hence differentiate products using price. Threats COS swimsuits for kid will face competition from other normal swim suits in the market existing markets. This can affect its penetration if intense advertising and promotion is not carried out. The market leaders can cannibalize the brand if it does not position itself strongly with its promise in the minds of the customers. Ansoff Growth Matrix Ansoff growth matrix refers to a marketing planning tool that links the marketing strategy of the firm to its general strategic direction as well as presents 4 alternative growth strategies in a table matrix. Market penetration strategy carries fewer risks because it leverages most of the current resources and capabilities of the firm. Market penetration is important particularly in a market that is not saturated (Cant, Strydom & Jooste, 2009). COS Australia has to use this strategy in penetrating current market using sales promotion and other methods that will appeal to customers more than the competitors. Product development has been achieved through development of special swimsuits for kids that can be used as undergarments. Saturation in the market cannot allow further growth. However, COS Australia special swimsuit is a new product that will depend on this strategy to grow its market share. Market development will be realized by COS for pursuit of market niches or other segments that have not been full served by existing suppliers. The special swimsuits target a special market that has not been explored by existing suppliers (Davies, 2008). Diversification entails many risks since it integrates both market and product development and can be considered beyond the competencies of the firm. COS Australia can consider offshore manufacturing to cut down on costs or even outsourcing some of the services in an effort to cut down on production costs. Porter five forces Bargaining power of suppliers-This force explores the much power held by suppliers and ability to control prices that will affect COS Australia profitability. The fashion industry has many outlets and COS Australia has the challenge of competing with other established brands in Australia. The bargaining power of suppliers is low (Kotler & Armstrong, 2010). Customers bargaining power-this is the ability of consumers to affect quality and pricing. There are many fashion and design dealers hence giving more power to the customers or consumers. The swimsuits are a unique brand. Threat of new entrants-there is high levels of new entrants in the fashion industry and new brands are coming up as entrepreneurs focus their resources in the growing Australian industry. Threats of substitute products-COS Australia swimsuits for kids have low chances of substitute due to their unique design but this can change any time as other producers invest in new product development. If product loyalty is achieved, the chance of brand switching will be reduced (Parul, 2014). Competitive rivalry-there is high competitive rivalry in the fashion industry. The swim suits have to be of high quality and style to maintain customer loyalty. Segmentation, targeting and positioning strategies It is important for the special swimsuits to meet a variety of needs of the target customers from the different market segments. The brand will target both high-end and low-end market. The high-end market targets the high income earners while the low-end market targets the low and middle income earners (Zimmerman & Blythe, 2013). Goods are tailored specifically a market defined by design, sophistication, price, packaging, and after sale services. The customers can further grouped in terms of geographical location, demographics, and psychographics. Product positioning refers to the way a product is viewed from the consumers’ perspective (Sahaf, 2008). COS Australia swimsuits for kids will be positioned as high quality products, affordable and having high performance. Targeting involves making COS Australia swim suits attributes be tailored towards a specific market. A target strategy that is cost-effective will be used to reach a specific market segment. The swim suits will target school-going children that have swimming lessons or know how to swim among others. 3. Final section: a. Branding strategies A brand is a term, name, symbol or design that is used to distinguish one company’s products from the rest. The branding strategy defines the promise that the product will give to the consumers. The swimsuits will be branded as stylish, providing high performance and affordable. The special swimsuits have to live their promise (Barrow & Mosley, 2011). The brand reliability is enhanced with consistency. At the launch of the product it is important to emphasize on the affordability since price penetration will be used to get into existing market (Knapp, 2008). Australia swimsuits for kids have to communicate the desired emotions since customers are not always rational in their buying behaviour (Davies, 2008). When a product appeals to their emotions they can go ahead to buy that product without a second thought. Emotional branding of the swimsuits can be used to make customers feel that they are part of COS Australia and are connected to it as a community. COS has to compete with other established brands like Armani, Denim, David Jones, and Bershika. b. Product strategies The product attributes have to be appealing to the target customers. These attributes consist of quality, design, and features. Quality is important for positioning the swimsuits for kids since durability can be endorsed through it. The company has to consistent with quality to ensure that the customers who buy COS swimsuits for kids are not disappointed in the end. The features describe the Intrinsic or physical characteristics of COS Australia’s swim suits that make up what it offers to the consumers (Zimmerman & Blythe, 2013). The design describes the look and performance of the product. Design is very crucial for swimsuits since it enhances the appearance of the wearer. c. Pricing strategies COS Australia will apply different pricing methods in order to access markets in the local and international industry. The penetration pricing will be used to get access into new markets. The company starts by pricing its swimsuits brand for kids at a lower price while targeting to gain some market share dominated by existing brands. Once the company gains a substantial market share it adjusts the price of its product upwards once it has gained some loyal customers (Uzunolu & Kip, 2014). In the Australian market where Cos Australia swimsuits brand will be launched, the company will use cost plus pricing. After the product establishes itself in the market it can use quality, originality, strength among other qualities to position itself in the market at an increased price (Riefler, 2012). Consequently, competition pricing has to be considered. The company has to look at the prices which other competitors in the same industry like Armani, Denim, David Jones, and Bershika have to offer before fixing its own price. Lower prices can make the company to incur losses while high prices will cause customers to troop to rivals. Competition pricing is important before the company’s swimsuit gains popularity in the market to become a market leader that can set prices to be emulated by other players in the industry (Parul, 2014). When the quality of the COS Australia swimsuit brand is appreciated by a convincing number of clients in the market, the company can then use premium pricing. Premium pricing gives the company the liberty to set prices that are high with regard to exclusiveness of the product brand. These pricing strategies will be used at different phase of product lifecycle. d. Promotion strategies Promotion plays an important role in communicating the message of the new product brand to the target customers. The swimsuits have to be packaged in a way that is appealing to the final target customers. The promotion mix is very important in ensuring that the product present the desired message to the target customers (Mohr, Sengupta, & Slater, 2009). Product mix involves marketing activities that are synchronized that include sales promotion, direct marketing, personal selling, advertising, and publicity. COS Australia has to use modern digital means to make sure the swimsuits are popularized in the market. All kinds of media have to be used to ensure that proper awareness is created around special swimsuits for kids. Use of Buzz word on the internet through social media, blogs, and the company websites can make it easy for target customers to identify with the product (Parul, 2014). A Twitter handle for COS Australia will be started and different hash-tags used to communicate effective messages about the swimsuits. On Facebook, a Facebook page for the new swimsuits will be created and people entered into a competition of seeing who will recruit most of his friends to like the page. Other social media platforms like Google hangouts, whatsApp groups, and Yahoo will be used to reach out to customers and create intense awareness on the swimsuits. e. Distribution strategies Distribution strategies are very important in order to meet place and time utility. The special swimsuits for kids have to use the established supply chain of COS Australia to reach the target consumers. Distribution is a very important part since it develops channels that the product follows to reach the target customer (Cant, Strydom & Jooste, 2009). COS Australia will use supermarkets, departmental stores, shopping malls, fashion shops, and other established retails and main distributors of its products. Personal selling and direct marketing will be an important method of reaching out to individual clients in order to popularize the product (Schmitt, 2012). Schools and other social amenities like social halls can be used to market the swimsuits on the institutions’ bulletin boards. Strategic places will be used to display the product in shopping malls and supermarkets. Relying on the existing supply chain will be important at the initial stage of the product hitting the market. f. Recommendations and conclusion Prior to the product launch COS Australia has to carry out intense advertising and promotion. Market testing will reveal how the swimsuit for kids will be received in the market. The focus is to present COS Australia swimsuits as an affordable, durable and stylish product. Before the product is recognized as a challenger or market leader, it will be content to enter into existing markets as a follower to market leaders and challengers. The product has to grow from a follower to a challenger and then a market leader where it sets the trend in the market through price and style among other areas. Before the product gain a substantial market share in the market it is important for intense marketing and promotion to be carried out to create product awareness. The swimsuit that can be worn as an undergarment is a unique product that can grow in the Australian market. 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