Marketing & Corporate Strategy: Case Study of Kid’s Apparel Store Strategic Marketing Audit- Essay Solution

Kid’s Apparel Store Strategic Marketing Audit

(2542 Words)

Background of the Firm

            The Kid’s Apparel Store is a retail company that manufactures and sells clothes for boys and girls ages between four to twelve years old. The company was established in the 1997, and from a small apparel store in Hong Kong that retails clothes ranging from kids to adults it has grown into a marketer of clothing and accessories for children. The company is best known for creating pint size version of the latest trends in adult fashion; the company started making apparels for children in 2001, but after the clothes were featured in the magazine pages in Hong Kong sales of the children’s apparel took off. And because of the strong response of the consumers in the children’s line, the organization focused on children’s wear line.

Mission Statement

            The continuous mission of the company is to manufacture and sell children’ apparel that are of top quality and value, so that the organization will continuously gain the respect and trust of the loyal customers and future consumers, and to constantly address the needs and wants of the consumers especially children, as well as the employees of the company, the brand gives emphasis on developing products for children that can be identified through its quality and innovative artworks and colour. The company celebrates childhood by paying homage to the innate creativity and vivid imagination of children. The company endeavours to be one of the great firms to have a business with and to work for.

The Vision statement contains the values and the beliefs of the company. The company seeks to convey the business in a method which reflects the company’s vision: “The Company takes into account innovative leadership, creative teamwork and a heart that strives to be the best among others for the good of the consumers, workers and the stakeholders.”


            The main goals and objectives of the company are to be the best retail store that caters to the children’s market, the company also plans to expand to the line of apparel that caters to the new born babies and infants it will be available in the market on the second quarter of 2007. In addition, the company is planning to expand in the international market at the end of 2007 starting from establishing stores in South East Asia and China. Future expansions in North America and Europe are still on plans and will be expected to be finished in 2008.

Product Offering

            The company sells casual clothes for boys and girls ages four to twelve years old. The apparels include t-shirts, trousers, skirts, shorts, dresses and blouses. Caps and hats are also sold in retails stores. Accessories for children are also retailed such as pieces of jewelleries and watches. Aside from those, the merchandise also comprises of various licensed products such as toys, shoes, socks and beddings for children. And in the second quarter of 2007 products for infants and newborns will be included in some of the retail stores.

The company, apart from the physical products such as clothes, aims to sell the idea of imagination, creativity and innocence through the products. The purpose is to persuade the consumers to buy the products because they see their childhood and remember the fond memories of being a child. And if there is a one word that could describe the products it is nostalgia, because the adults will long for their childhood if they see the products and the children as they grow older will also experience the same thing.

The primary benefits that the consumers will obtain upon buying the products of the company are the top quality of the apparels and accessories, the firm assures that the consumers will get what they paid for in our products, the quality of the products is excellent and it can last for five years and more. The colour of the fabric does not wear off easily. The second primary benefit is that the styles of the clothes are trendy and in line with the latest trends in fashion, at the same time, the company also offers classic products that will not go out of fashion. And finally, consumers will find the products cheaper compared with other retail stores but with the same quality. The secondary benefit that consumers will get is that the children will enjoy wearing our clothes because they will feel celebrated and honoured.

In disseminating the products to the consumers the company utilizes two distribution channels which are the retail stores and the internet. The local as well as the foreign consumers can obtain the products through the 10 retail stores located all over Hong Kong. And for international customers, the online store is already opened as of the year 2001, there the customers could order and purchase their desired products and it will be shipped in their specific country or location.

In selling the products of the company, there are various modes or channels utilised by businesses, and in the company there are two sales channels being used and these are direct sales and Electric Sales. In direct sales the products are sold in the retail stores and the employees assist the consumers in buying the products. According to  (1997) successful direct sales people develop evolving association with the customers. In the company having a continuous relationship with the consumers is important so that we will be able to understand their various preferences. The second channel used is the electronic sales, wherein the company is selling the products on line as well as employing other businesses to sell the products such as Amazon and Ebay. Although it is a relatively small market, with the rapid advancement in technology it will be one of the major channels of selling. According to  (2001) Business-to-business which is the largest sector in electronic sales and Business-to-consumer trailing behind.

In marketing the products of the company, the firm uses advertising and direct mail as marketing tools. Advertising is a paid transmission via a medium wherein the company, the product or the service is recognised, however in advertising the message is restrained ( 1978). In advertising, the company employs commercial advertising through billboards, magazine ads and television advertisements. Sponsorship is also used wherein the company promotes the products by sponsoring an event for kids. Another form of marketing that will be utilised by the company is direct mail, which according to (1996) is an unsought advertising sent to possible consumer through mail. In direct mail, the loyal consumers are sent post cards and greeting cards every holiday seasons, so that the company will develop a deeper relationship with its customers.

The pricing strategy employed by the company is the competition-based pricing, according to  (2007) there are three types of competition based pricing and these are the destroyer pricing, price matching and price bidding. In the company, the price matching will be implemented because lowering prices can be terrible for business, therefore the company will fix prices that is near to the competitors.

Since the opening of the first store in 2001, the feedback of the customers had been really good, the target market which is the ABC market has been captured by the company. Moreover, the company has more loyal customers than before.

Brand Analysis

            The brand is everything individuals relate with the company; the encounters of the consumers with the company on every degree, from exposure to different marketing strategies to the use of the products, up to the interaction of the employees to the customers. The idea and the perception of the consumers with the brand tell what they know, and trust about the brand. A company must develop and sustain a brand that will support what the company is offering.

If our brand is a person the words that it would be described are fun, creative and trustworthy. The three words the brand would convey to consumers is that Celebrate Your Childhood! The company wants people to think a fun company with solid products once they have encountered the brand.

5 C’s of the Organisation

Company- to identify the strengths, weaknesses and key resources of the company, the SWOT Analysis is utilised. According to  (2001) SWOT Analysis is a general method wherein it can find appropriate usage across different management activities and functions; moreover it is particularly suitable for the early parts of strategic marketing.

Strengths- the company does really well in creating apparels and apparels for kids. The advantage of the products of our products is that it has creative and colourful designs, it is also cost lesser than our competitions. The service and the atmosphere of the stores are really good; the consumers will feel at home once they step inside the stores. The strengths of our marketing strategy is that the advertisements are minimal, on the other hand, the company takes care of every customer by providing a good service and sending post cards to them.

Weaknesses- every company has its own share of strengths and weaknesses, the company has is currently not doing well in its advertisement because it is not as aggressive as other companies. The weakness of the products is often times the clothes are too trendy and most parents prefer classic styles. Aside from the weaknesses, there are also some issues regarding the awareness of the general public of the brand because there are only ten retail stores and the advertisements usually do not reach the C market in which the company is also targeting.

Opportunities- there are a number of opportunities in the market such as increase the market share, the market size, the company world invest in improving the products and services, to make use of the available resources, and to finance other factors such as competition.

Threats- the market threats include the competition, the economy, the legal and societal change, the limitations of the products, and the restriction of the resources.

Customers- the target market of the company are children between the ages four and twelve, within the range of A-C class. It caters to both boys and girls regardless of the ethnic backgrounds. The location of the stores is scattered all over Hong Kong and will be expanding soon in China and South East Asia. In addition, since the company targets children their spending habits is controlled by the parents, therefore the target of the company is also the adults who have the purchasing power. Parents who look for classic and trendy apparels that have the money to spend are the target of the company. The information of the products of the company is through media and word of mouth. The media is a useful tool in conveying and introducing the products to people, it also has a huge impact in the purchasing decisions of people. Purchases that are influenced by word of mouth of other consumers have proven to be successful because those consumers became one of the loyal customers. The market of the company is primarily brand loyalists, our customers on the first retail store are still our customers, they use the brand because they already trust and are comfortable with the products.

Collaborators- In the apparel industry having collaborators is important, from the raw materials to the finished product, collaborators play a crucial role in the success of the company. In the company, the raw materials needed for the creation of the products is sourced from nearby countries in Asia. Approximately seven suppliers are sourced all over the region. The website Amazon is also our partner in the distribution of the products online for our customers abroad.

Competitors- In the retail industry, especially in the apparels the competition is tough. Each company must have creative products as well as a good marketing strategy. And in order to be on top of your market a company must analyse their competition, in this case the strengths and weaknesses.

Strengths- the strengths of the competition are that most of them have established their companies ahead of our company; another is that their stores are larger compare to us and the number of stores is higher. Another is that their advertising strategy is really aggressive with various billboards, print and television ads sprouting all over.

Weaknesses- the weaknesses of the competition includes their prices are higher compare to our products because of the high cost in advertising, another is that the colours and designs of the clothes is not as vibrant compare to us, and their stores do not provide a homey atmosphere.

Context- aside from competition, there are also other factors that have a huge effect on the business. In order to identify those factors a PEST Analysis is employed. According to Chartered Management Institute (2005) PEST Analysis is a method utilised to assess, examine and identify the external factors that may have an impact on the performance of the company. PEST stands for Political, Economic, Social and Technological factors that affect the business.

Political- the political system of the government affects the business such as the political stability, the policies in tax and framework of the legislative in the business, trade and employment.

Economic- the economic factors that may affect the business are the inflation rate, the GDP and GNP of the country, exchange rates and many more.

Social- The social factors that can affect the organisation are the lifestyle preferences, level of education, patterns of employment and the pattern of spending by the consumers.

Technological- The advancement in technology nowadays has an impact on the success of the company. The factors that must be considered in technology are the new technologies that come out in the market, the development of e-commerce and internet and the rates of obsolescence of technologies.

 In gathering the necessary information that would be a big help in identifying the needs and wants of the consumers, the competitors that would be threats, the changing context of the business and the role collaborators do in the business, employing a marketing analysis tool is important. First is the identification of the External Factors in the Macro-Environment by using PEST Analysis or SLEPT Analysis, afterwards the micro-analysis which includes the overview of the market and the competition. And in the Internal Factors, the company determines the weaknesses and threats of the information systems, productivity audit and the marketing mix analysis.

Identifying the 5Cs which are the company, customers, collaborators, competitors and context is an effective tool in analyzing the status of the company in the market because it enables to identify the weaknesses, strengths, opportunities and possible threats in the market. It is helpful in the marketing strategy because the company is able to find a particular target market and changes in the strategy would be easier. It has a huge influence in the current tool in marketing because it makes analysis easier, and in order to enhance the analysis thorough research must be done.

With the current performance of the company, the manner in which the gathering and interpreting of the 5Cs would still remains unchanged. The company employs the SWOT Analysis which is a tool that evaluates the Strengths, Weaknesses, Opportunities and Threats of each of the 5Cs, which would be easier in determining the efficiency of the company and its performance in the market.