Levi Strauss

Levi StraussLevi Strauss specification studieInquiry 1) What environmen tal variables contributed to the 1998 grade of Levi ?Levi Strauss is the worlds best-kn sustain jeans betray, nonwithstanding its rigid to see frequently chance of the connective regaining its former glory without a demonstrable overhaul. Iconic or not, what kind of outlook lies in store for a association which derives form 85% of its annual revenues from selling pants? And unless reall(a)y two sorts of pants at that, which ar also change by just most alwaysy new(prenominal) clothing manufacturing business on the planet. Either Levi Strauss needs to diversify substantially, and bolt on rough other brands or more likely needs to sacrifice its lenghty cherished as yet out-of- catch indep exterminateence and become part of someone elses larger multi-brand portfolio. These twelvemonths of struggle against a vast array of competitors deplete merely added to the tardy erosion of the brand. The development of value path sense of touch has helped, nevertheless condescension doubling in amount during 2004, its contribution has steadily decreased ever since.In the late 1990s, Levis became a victim of their aver success. As tumesce involved in corporate restructuring, the pot effectively ignore a seismic shift in the youth mart. In the 1980s and archean 1990s, Levis 501 jeans had managed to dominate the market for everyday clothing as a dissolving agent of senior high school quality manufacturing and smart marketing. on that point were some kinds of jeans, went the accepted perception, however Levis was the brand to which all others aspired. A brilliant marketing campaigning, chiefly in Europe, reinforced the brands hip status. merely in the late 1990s, Levis jeans suddenly became a victim of its own success. They were seen by the advanced generation of teenagers as the jeans my public address system wears, and that lay them completely by bygone of fashion. Fash ions in divide came and went nevertheless Levis fai guide to respond, leaving the market wide open for competitorsThe companys biggest mistake, arguably, was to ignore the baggy divide, which rode in on the back of the mid-1990s grunge movement, and remained the leading fashion style for the rest of that decade. maculation Levis stuck rigidly with the 16-inch straight-leg divide that appealed to the instantly ageing market who had rediscovered the brand in the 1980s, still the least hip of US retailers began selling utmost(prenominal)-cut. Millers Outpost, Tommy Jeans, JNCO and much JC Penney and Sears were selling jeans with legs as wide as 23 or 40-inches. The fashion-conscious teenage market began buying their jeans from other manufacturers, while a advanced breed of retailers, led by The Gap, captured the middle ground. Protecting their premium status, Levis refused to chase the market and strictly adhered to their long-established policy of only selling through specialist o utlets and eliminateing discount stores including Wal-Mart. Although this held the brands perceive value it also limit sales to only encircle one-half of the US retail market. Worse still, later that decade the market as a whole began moving away from denim altogether as combat and cargo pants became the advanced fashion Charles Boisson Leaf 3Interrogation 2) How could a sensitive and informative Marketing Facts System (MIS) have helped Levis to identify these environmental variable and form outlook strategies ?THE Demand FOR market SUPPORTIn 1986, Levis relaunched the 501 with the La belowette and Bath commercials. The tremendous success of these exploits and the campaign that developed from them has been well documented. All of the commercials featured the 501 jean and most tell 501 specifically in the end frame.The advertize success was not restricted to the 501 alone. There was a halo effect on the whole Levis hustle. However course the 501 took on a dominant share of Le vis business.This dominance was intended. The 501 was positioned as definitive. It is an anti-fit jean which is fair for most mankind, and, in a sense, 501 for most tender beings took fit outside of the purchasing equation.Despite this, there were (and still are) a signifi groundworkt sum of mankind who, for reasons of personal image or style, did not consider the 501 as the correctly fit for them.Moreover, a brief for range advertising can a good deal lead to originative cul-de-sacs a speech of products and an invitation to the consumer to create his or her own survival of the fittest etc.Consequently, although the objective of the advertising was not to establish undivided fit identities, we did specify that each execution should feature one fit only and would talk about the benefits of that fit. crosswise a range of executions we aimed to establish a sense of the multiplicity of the fits, thereby addressing the key objective.Fit adverting Fit messages also pose a strategi c and germinal challenge. Human beings choose different jeans fits for reasons both of personal physique and contemporary fashion. If advertising addresses one motivation, it struggles to communicate the other. And the more obvious creative settlements tend not to be challenging or motivating. Charles Boisson tacking 5 For example, a tight fit can be communicated by cover a thin person and a loose fit by showing a fatter person. Nevertheless the latter expression clearly does little for loose fit. And what of the mankind who wear loose fit for style preferably than physical reasons?Alternatively, a fit message can be conveyed by showing the overall style or fashion of the wearers of different fits. For example, a punk in tight jeans and a hip-hop fan in loose jeans. However youth fashion cannot easily be separate into discrete tribes with conveniently different jeans fits. Moreover, young mankind quite naturally recoil from any cynical attempt by advertisers to mirror their ow n street-level cultures. And, as with the above, what of the homophile beings who do not choose fits for fashion reasons?We reason that these more literal expressions of fit were not worth exploring and we directed the aggroup to seek outside more lateral solutions.THE CREATIVE SOLUTIONThe creative team, conscious of the objectives of the advertising and the strategic and executional minefields to be avoided, came up with an innovative solution to the brief.They developed a range of executions each employing a black and snow-covered still from the respected photographer Bill Brandt to deal with one ruddy Tab fit message.They did not talk about fit in a literal path. sort of they implied the various fit messages.Moreover the images sedulous were not completely unrelated to fit. (They were not vegetables or fruit) Rather all the executions focused on the human form, which is after all the undercoat of any fit choice.ADVERTISING EFFECTThe poster campaign ran across the nation f or four weeks only in April 1993.Millward Brown tracking showed very high advertising recognition over 40% of a sample of 17 to 29-year-olds recognised the posters.More importantly, spontaneous and prompted awareness of carmine Tab ariseate from 35% to 45% and from 57% to 75% respectively. Thepercentage of respondents able to ingeminate any non-501 fit number rose from 50% to 60%.We are unable to divulge actual sales data.SUMMARYThe planners role does not only entail pointing the creative team in one special(prenominal) direction it can also involve illustrating to them the strategically unsound and creatively fruitless routes.In advertising non-501 Red Tab fits for the first date, Levi Strauss were entrance a minefield. By identifying the best role for advertising and mapping gone the geography of that minefield, the planner was able to play a part in the development of advertising which maintained Levis best standards of creativity and effectiveness.CREATIVE instructWhy are we advertising?To raise awareness of the range of Levis Red Tab jeans by demonstrating that Levis produce different fits to compliment different dust shapes and personal styles.Who are we talking to?Boys and girls, 15 to 19 years ancient. They are aware of Levis advertising and recognise that 501s are the original, definitive jeans. In circumstance, they may already own a pair of 501s, nevertheless find plastered aspects of 501s either inconvenient (ie button fly) or uncomfortable. They are at the Charles Boisson Sheet 6 middle end of the market (early/late adopters) and are often insecure and lack confidence. They therefore demand to be reassured that they can acquire into the imagery associated with 501s, while having a pair of jeans that fits comfortably and flatters their individual shape.The campaign must employment as both posters and press. The campaign should avoid analysis of, or comparison with, 501s. This is not an opinion leader campaign, and is aimed at a younger, m ore mass-market consumer. Charles Boisson Leaf 7Interrogation 3) Analyse the grandeur of the various marketing mix elements in the success failure of Levi, how inwrought is design?Levis share of the denim market plummeted. In 1990, according to tactical Retail Monitor, more than 48% of men chose Levis as their preferred choice of jeans. By 1998, this had tumbled to 25%, while Lee and Wrangler had risen from 22% to 32%, and private label brands including Gap from 3% to more than 20%. In sales terms the brand slipped from a 30% US market share to 14%. (Upmarket designer labels such as Tommy Hilfiger and Calvin Klein got a great deal of publicity however never achieved more than inclosure 7% of the market). The percentage of teenage boys who thought Levis was a really cool it brand had dropped from 21% in 1994 to just 7% by 1998. Levis position has, for the most part stabilised since then, nevertheless competition frame tearingThe Levis brand instantly houses distinct sub-brands. Chief amongst these is Levis Red Tab, which includes the legendary 501 button-fly design. (The number 501 was originally the products stock number, first adopted in 1890 the red stuff tab was first used in the back pocket from 1936). Levis time of origin features a broader range of classic retro designs. In pursuit of the youth market, the association has tried to turn back the tide with more extreme cuts, such as Levis Engineered Jeans, introduced in 2000 and supposedly designed ergonomically to fit the bodys contours. virtually cuts are much pre-stained with oil. Another stylised wise(p) design launched in early 2003 as Levis Type One. These offered exaggerated versions of traditionalistic features such as rivets, stitching and the tab, blown up in extent. However sales were slack up to capture off, chiefly in the US, despite high profile marketing, including a Super Bowl ad (which the association later claimed admitted was unsatisfactory). They, along with other stylised b order known as Silvertab, were replaced by the Levis Capital E path. Levis ICD, a partnership with Philips to market workwear with integrated electronic devices such as mobile phones, MP3 players etc, was withdrawn in 2002. The concourse also licenses gone the Levis brand to other manufacturers for branded T-shirts and accessories. Combined sales of the core brand modify in 2007, reaching almost $3.2bn. Levis is primarily a menswear brand, with just under three quarters of all pairs sold bought by men.After its many attempts to introduce more stylized or fashion-oriented designs had failed, the association agreed to stop its premium positioning and chase the mass-market as well. A advanced design, Levi Strauss Signature, launched in July 2003, initially available exclusively through Wal-Mart. By the end of the year it had become apparent that the advanced border was the much-needed hit for which the association had been searching. The crowd rebranded the range as Signature by Lev i Strauss, extended distribution to objective Stores and Kmart in 2004, and also introduced the range into selected mass-marketers in Australia (including Coles Myers Target and Kmart), Japan and other Asian markets. It was also launched in the UK (through Asda), France (through Carrefour), Germany (through Wal-Mart) and Switzerland (through Migros), nevertheless performed poorly and was withdrawn in 2007. Yet after a strong set off, sales of the Signature path have travel steadily since 2005, declining from a pinnacle of enfold $410m that year to $260m in 2007.Dockers, first launched in the US in 1986, is the companys khaki-based casualwear path. It was launched as something of a reaction to inroads into the market by Gap and others, serving as a halfway mark between jeans and smarter dress pants. Dockers Slates, a sub-brand of dressier and more pricy trousers, was discontinued in 2004. Although it has been generally successful, Charles Boisson Sheet 8Dockers remains very much the second string in the groups portfolio behind its jeans border. In 2004, Levi Strauss lay the Dockers brand up for sale in order to brook on its still struggling core business, however failed to attract a suitable buyer. Sales of the brand were reported at $1bn for 2003, however had fallen to enclosing $775m by 2005, with sales concentrated in the US. Since then it has repositioned itself as a wider casualwear brand, diversifying into shirts, sweaters and blazers, as well as a border of womens clothing. The social unit was rewarded with an increase in revenues for 2006, its first for diverse years. For 2007, it generated sales were enclosing $915m. The accumulation also generates significant income from royalties on Dockers belts, footwear and other accessories manufactured by other companies under license.Levi Strauss has production facilities and customer processance centres throughout the earth. Until comparatively recently the corporation maintained a policy of manufactu ring its goods in the regions in which they are sold, however rising labour costs and declining sales make this increasingly unfeasible. Production in the US and Europe began to be farmed gone to cheaper regions in the late 1990s. Having already closed six of its US factories by 2003, the collection announced that the remaining four in North the States would also be shuttered by early 2004. The collection supplies its products to encircling 60,000 retail outlets worldwide. It owns and operates encircling 200 of its own Levis or Dockers branded stores, and franchises encircling another 1,300. More than half of these stores are located in the Asia peaceful region. Otherwise sales are through department stores and national chains.There are three regional business units Levi Strauss North America operates regulate subsidiaries in the US, Canada and Mexico, and accounts for almost 60% of revenues, or $2.5bn in 2007 (compared to a peak of $4.8bn in 1996). Levi Strauss EMEA is the second biggest market, however performance there took longer to incur than in other markets. Sales rose in 2007 for the first date in distinct years, finally returning above the $1.0bn barrier. Asia Pacific remains the smallest market for immediately, nevertheless has been the companys strongest performing region for distinct years. Sales rose by a further 6% in 2007 to $805m, with Japan modify a small under half of all sales. Charles Boisson Sheet 9Inquiry 4) As a strategic marketing consultant, advise Levi about what instantly it should immediately do ?It is every businesss objective to maximize their network and lessen their expenses. Levis has invested on one of the most essential resource that a association could have its employees. Their corporate strategy has immediately been aligned with their human resource management which is valuing their employees due to high costs of recruiting and teach fresh staff. It must be noted that losing an employee can be very expensive and high staff turnover can eventually ruin a business. The at the end object that businesses call for is for its competitors to benefit from the training, knowledge and training that it has built within its workforce.It is suggested that employers give their mankind the opportunity to create their own benefits decisions. This method, employees provide capture a keener interest in their benefits. The traditional corporation benefits package often has a rigid one extent fits all approach it fails to consider the varying needs of individual employees. In addition, the traditional corporation benefits package may sometimes be complicated and hard-fought to manage. Thus, it is greatly recommended that companies like Levi Strauss and Co. implement a pliant benefits package to assist reduce costs and provide a greater choice for their workforce. Furthermore, flexible benefits provide additional lifestyle choices along with traditional association benefits such as private healthcare and the cor poration pension scheme which will allow employees to choose the benefits that they require which in turn will strike them and create them more productive.It is also valuable that companies like Levi Strauss and Co. consider some of the following pointers (1)ullet the main goals of the companys employee benefits programme,ullet the endure age that the association at the end reviewed their benefits scheme,ullet steps or initiatives undertaken to ensure that the companys benefits programme underpins their business strategy,ullet knowledge of employees regarding the benefits that the association offers and how they benefits from it,ullet issues like sickness and absence, healthcare and dental affliction, and (6) the extent of the relevance and moment of the recruitment and key staff in employers business and their industry.