Note: Sample below may appear distorted but all corresponding word document files contain proper formattingExcerpt from essay:
Overall Marketing Strategy
The group's marketing strategy is focused on raising awareness on social issues concerning today's society and taking a stance of the real world, rather than encourage costumers to buy its products.
Considering the large product diversification characterizing Benetton's portfolio, it is very difficult to define the manufacturer's main competitors, as it's difficult to define it's industry. Thus, according to Hoovers.com (Accessed January 2009), the company's top 3 competitors are: Inditex, GAP and H&M. Inditex is a Spanish based, clothing group, which is considered to be Benetton's main competitor as it designs and retails its own products. It is also a global company managing over 3,690 stores in 68 countries. GAP is an American-based company with 4,250 stores worldwide. Unlike the Italian company, GAP doesn't manufacture its products, being responsible only for the retailing part. H&M is a Swedish-based company with over 1,500 stores in 28 countries.
Benetton has often been labeled as the fast food of fashion, or better said McFashion. Luciano Benetton himself, the company owner, clearly distinguishes between the artistic fashion of Italy and France, such as Armani or Chanel, and Benetton which he refer to as industrial fashion. Nevertheless, the company's competitive advantage relays in its ability to understand the key success factors behind the McFashion business.
Benetton's product strategy is a global one. The same garments are sold across countries in the same small boutique-style shops, which follow strict corporate merchandising guidelines, and are promoted by print media using identical advertisements worldwide. This is a total look strategy involving color coordinated garments, rather than individual products.
Around the year of 1995, Benetton adopted a price reduction strategy at worldwide level. This strategy was meant to enable the company to guarantee its customers a both more suitable and competitive supply of products. The price reduction was simultaneously joined by decreased production costs. The two actions resulted in an 8% increase in goods sold. Nowadays, the company has different price levels across countries and brands. Thus, in Europe the average prices are higher than U.S., but in the same time some brands such as United Colors of Benetton are priced substantially lower than others such as Sisley who is addressed to a more sophisticated market segment.
Benetton also has an extended system of outlet stores in which its products are sold at large discounts. The products sold in these stores are usually from prior collections and the use of large discounts is meant to stimulate customers to buy collections that are slightly expired, thus avoiding additional inventory costs.
In the late 1990s - early 2000, the Italian manufacturer restructured its distribution network by implementing a new logistic system in which the warehouses became part of a centralized distribution system, rather than just being simple storing facilities. This system was much more efficient logistic-wise as it reduced the fragmentation of inventories at international lever by concentrating the finished goods in 3 centers, one in the U.S., one in Italy and one in the Far East. Initially, the automatic distribution system handled over 30,000 packages a day and was managed by a 10-member staff, while a traditional one would requires a staff of 400 for the same workload. In 1996, the implementation of this new system resulted in roughly €5 million savings in transportation costs.
An efficient production system was added to improve logistics efficiency. The company worked on developing an advanced dyeing process, which would enable the finished product to be dyed instead of dying the yarn first. Thus, the manufacturer was able to run an efficient customized production system, always updated with the latest market trends in the fashion industry in which tastes in color change very often.
Benetton's promotion strategy reflects the company's desire to create images of global concern for its global customers. This strategy is well-known for targeting issues rather than clothes as the company believes it is more important for companies to address a current important issue of today's society, rather than use their advertising budget to convince consumers that they will be happy if they purchase of their products. Thus, Benetton managed to attract substantial attention from the public and stand out in its industry in terms of social responsibility.
The means involved in the company's promotional activity include: (1) sport and event sponsorship, (2) Colors magazine, (3) Fabrica project, (4) image advertising and (5) controversial campaigns.
Benetton sports system changed its name to Playlife in 1998. This division manages famous brand names, such as Prince, and reflects the Group's involvement in the sports related activities, covering a wide range of sports from skiing to tennis. The Italian manufacturer sponsors basketball, rugby, volleyball, motorcycling and Formula One teams, which is one of the reasons why many young athletes chose Benetton products to be their favorite sports brand. Additionally, the company is involved in developing sports facilities success in communicating through sports can be seen by its efforts in developing sport facilities.
Colors magazine is a bi-monthly publication which is distributed in 6 bilingual editions in 3 continents.
The Fabrica project is both a workshop environment and a center of communications in which a group of 20 students from the field of communications from various countries research future trends and new ideas.
One of the specific features of Benetton's image advertising is that its images do not include a product, but only the company logo. Moreover, its adds to not suggest customers to buy its products. These are designed to increase awareness regarding global issues that concern today's society. As far as their products are concerned, Benetton advertises those via catalogues and fashion editorials that are displayed to consumers in the stores. Additionally, the public relations offices are in permanent contact with fashion editors in different countries across the world. These offices engage traditional marketing techniques thus making sure that the products receive an optimal exposure or sales personnel.
Image advertising is a form of lifestyle marketing. Advertising industry experts associate image advertising with a plan of getting the customers to "buy-in" to a certain lifestyle, such as Benetton's which is very controversial, by connecting to later through a psychological level first and on the product lever after.
Shockvertising is a special type of emotional branding by Benetton with many occasions, though which the company sells images rather than products, by connecting to the customer's emotions.
Benetton's advertising campaigns have always been focused on deep social issues of global concern, such as death, AIDS and racism. The HIV Positive campaign used shockvertising to raise awareness about the disease by displaying the words HIV Positive tattooed on a person's arm, front and back (see appendix section). The purpose of this campaing was both to raise awareness of AIDS, but also to draw attention on the danger of stigmatizing certain social groups.
One of Benetton's most damaging campaigns for the company's revenues addressed the capital punishment by displaying images of some of America's death row inmates. The campaign was meant to show the world that death penalty is not a distant problem, which is occasionally present in the media, but a current, serious problem. The reaction of some the true believers in the old American values was quick and acid. Consequently, the Benetton lost a number of contracts with its retailing partners in U.S..
Many of the company's communication initiatives come to support international humanitarian associations. As such in 1993, Benetton was part of a global project involving clothing redistribution to people in need, being assisted by the International Federation of the Red Cross, alongside other humanitarian groups.
The logistics and promotion activities are the company's keys of success. The first enables the company to adapt to a fast changing environment and rapidly changing needs of the customers with flexibility and speed, while the second enables the manufacturer to both stand out of its crowd and be remarked by a substantial number of consumers and give the company the opportunity to address social important issues. Nevertheless, the character of the promotional activities undertaken by the company didn't always have the success the group aimed for as certain groups of individual felt offended by the messages contained in these campaigns, generating negative consequences in terms of revenues.
The pricing strategy is definitely one where Benetton can dwell on as it's not globally aligned, unlike all others. The price levels vary across countries and on different continents for the same brands. Such a strategy wouldn't be so difficult to achieve, as the groups production and distribution activities are centralized and managed in an efficient manner via high technology systems.
Finally, the product strategy is a well chosen one. The group acquired different brands along time to cover more market segments in terms of age, style, gender, revenues and so on, thus, diversifying the product portfolio and reducing from the potential vulnerability of a changing economic environment.
Annual Report - Benetton. 2008.
Annual Report - H&M.…[continue]
"Marketing Plan Benetton Is A" (2009, January 25) Retrieved December 7, 2016, from http://www.paperdue.com/essay/marketing-plan-benetton-is-a-25287
"Marketing Plan Benetton Is A" 25 January 2009. Web.7 December. 2016. <http://www.paperdue.com/essay/marketing-plan-benetton-is-a-25287>
"Marketing Plan Benetton Is A", 25 January 2009, Accessed.7 December. 2016, http://www.paperdue.com/essay/marketing-plan-benetton-is-a-25287
Retail Marketing Operation Management Zara is a company that has used exciting marketing strategies to enable the company to grow into the mega-merchant that it is today. From humble beginnings Zara has become a world and industry leader. This report concerns how Zara began and who shops there, along with a section about major competitors. Important business elements such as value proposition and its delivery, how Zara accommodates "green" ideas, supply
David Kirby dying of AIDS in 1992, an image that the United Colors of Benetton used to increase awareness about the disease and educate the public. This paper will aim to create a message for this image, analyze the targeted audience and the advertisement strategy that would be used to promote the message. The final goal would be to elaborate an integrated marketing communications, aiming to promote the ideas
Fundamentally, hygiene factors are required to make sure a worker is not dissatisfied. Motivation factors are desired to motivate a worker to higher performance. Herzberg also further classified peoples actions and how and why they do them, for instance, if one performs a work related action because they have to then that is ranked as movement, but if one performs a work related action because they want to then that
Strategic Planning in IT IT Impact on Service Industry Performance Cooperative Competitive Competitive Advantage Implementation of IT Innovations 1992 U.S. VALUE-ADDED AND EMPLOYMENT BY INDUSTRY AVERAGE ANNUAL GROWTH IN GDP PER HOUR, MAJOR SECTORS OF THE U.S. ECONOMY Management TASKS IN BUREAUCRACY VS ADHOCRACY ORGANIZATIONS This paper addresses the following problem statement: "Without information technology (IT), a business will not be able to compete globally in any industry, nor in any market it wants to enter. It will
With this in mind communications strategy has to be developed and implemented. The central debate remains that of degree of uniformity. The pros and cons are obvious, i.e. economies of scale, consistent message across markets, centralized control, different market characteristics, media availability and costs and government regulations (Balabanis & Diamantopoulos, 2011). The stronger argument appears to be that different strategy appears to work in different situations, rather than a
Threat of substitute products Given the dynamic retailing environment, the threat of substitute products is fairly intense. Customers normally shop at large corporate retailers, but their loyalty levels are often unstable. In such a context then, the retailers -- including Marks and Spencer -- have difficulties in retaining their customers and preventing competitive items from replacing their own products (Dalic, 2004). Competitive rivalry Last, in the environment that has already been described, the
Competitive Advantage In contemporary times, competition is getting tougher with the passage of time and therefore product leaders are propelled to present novel and unprecedented products, nevertheless, what is meant by 'best product'? And which type of product decisions do the product leaders make in this regard? Generally, when consumers purchase a product they comprehend that it gives them a superior level of satisfaction as compared to the other competing products