Introduction
The marketing strategy for instituting changes in a product line from low end to a higher version is a process that might need to include the mobile and internet marketing strategies to be successful in this environment. Considering the competition are two very well-known competitors Macy and Nordstrom. These two competitors have been in the vertical for many years and have established customer base.
In shifting the market products from one segment, the lower priced products, to another, the higher priced products, involved many organizational and strategic changes. It is not only the price tag that gets changed but items such as employees, layouts, advertising, customer base and several other not so obvious factors. If you were just to examine the customer base someone who is paying a thousand dollars for a sweater is going to insist on different treatment than when paying ten dollars. This expectation manifests itself in many ways and those are the consequences that the retooling will encounter.
In establishing a new customer base attention needs to be paid to the current customers as they do provide an accessible market. With certain incentives they might be able to convert to high end customers. In addition, the social media component is important as well as new marketing initiatives.
Direct marketing using snail mail is an option to the designated zip codes to encourage shoppers by offering discounts is a tried and true sales technique that might be successful in this venture as it will give the customers a chance to come in and view the products. With a discount the impetus to buy will be greater and the chance to make a loyal customer has begun.
Marketing Driven Strategy
The direction of the market is important so as to drive the right traffic to the new sample of products. The direction has four particular choices that include either toward the goal or away from it. The Arena that the market resides moves toward or away from the advantage of buying from the new platform. Access and activities round out the selection that consumers use in taking a look at their buying choices and in picking the one that most suits their particular tastes and price points.
With these four considerations on what direction the consumers purchase their goods, it is enlightening when changing the sales process as the emphasis is on driving the consumer toward the new product by creating the activities that the customer would normally engage in. These activities are events such as a designer trunk showing. This is a fashion show of sorts with a designer of the high end clothing line showing to a select group a new line of fashion for the upcoming season. Creating the desire in the customer for the newest first to the market selection is one way to garner the market share.
This particular venture as an added nuance in that the competitors are two well known entities. The two competitors are leaders in the middle line clothing sales and as part of their offerings the consumer can find high end and middle designer in the products. Competing with them in a traditional manner will be a tough strategy so one strategy that might be more effective is to use social media and an ecommerce site. The ecommerce site can offer site to store pickups or online orders to pick up in store to increase the customer traffic.
Pew Research Center offers a demographic and social media information that will help the new site to get started.
Figure 1Facebook user, Pew Research Center
Some great information is contained in this graph. Fully 71% of the online adult users now Facebook. Marketing strategies could be effective if Facebook and Facebook pages are designed to attract the high end designer shopper. Women are more likely to use Facebook in marketing this means that all sales information on both men and women because women do the shopping for men.
Product Market Boundaries
A product focused boundary is one in which the roadmap considers the product as the object for meeting the market demand. The Apple Company is an example of product focused marketing.
In the clothing industry, the product focused approach is one that concentrates on the weight of the designer. The designer and their level of product design increases the value of clothing and will sway the customer toward a different product. The clothing industry carries several different product offerings with the lowest being mass produced lower end products to the individually one of a kind designer haute couture. The new offerings of the higher end clothing are not meant to be the one of a kind individual item but the items that is produced by designer shops. Lines such as Ralph Lauren, Jones of New York, Burberry and many more have name recognition. The name recognition helps to sell the product. The price tag is high enough to warrant a higher cost and will find comparable items in other high end stores.
Products of high end designers can often have some marketing of the name recognition from the designer themselves. A strategy to combine forces with the marketing team of the product designers could help to increase brand recognition. In this case of a changeover, it is important to get the word out of the quality and also to create a desire in the part of the customer for these products. By adding to the product designers marketing efforts a two pronged approach is more effective than just a single effort from the store. Sometimes the brand will offer items such as free T-shirts, or wallets or some small branded item to help drive customers to the new brands in the store. The use of these come on products helps to illustrate that the designer name is now available in the offerings of the store.
Contests offering designer products can be helpful to garner customer support. The contest have to be of a high quality though if they are to get the attention of the higher end buyer. Contest such as a new season wardrobe, or a free style makeover, or anything that is appealing to the buyers of the more expensive products.
Market Segmentation Strategy
The market segmentation strategy involves breaking down the large market segment that is in the market for new clothing to drive them to your company's offerings. In order to be effective the segmentation should take large groups and group them in a homogenous manner with the groups of like minded buyers together. In this way the market can be effectively reached by the largest number of possible customers.
One example of the market segmentation that is effective to change the low end shopper to a high end shopper is that of demographics. The demographic segmentation divides the market according to such things as age, gender, occupations, and income. These types of attributes will offer the ability to direct sales information to a particular group that shares like characteristics.
The demographic information helps to include a social media campaign as part of the marketing efforts. By tailoring the message according to the anticipated reader the message is the most effectual.
A marketing strategy is not a one size fits all strategy. To get the most mileage from a campaign it is necessary to drive the right message to the right audience. Many ecommerce sites are very good at this and the consumer preselects the items that they like and based on algorithm new offerings from the designer can be targeted. In print media it is a little less specific to the target market. But whichever method or combination is used the market segmentation will direct the message.
Customer Relationship Management
In an effort to gain customer relationships many stores offer loyalty programs. These programs give an impetus to the customer to continue to shop and in return they receive usually a discount toward future purchases. In this case where the line is changing the stores may take advantage of the customer base and offer the existing customers a discount of a particular purchase. This gets them into the store and allows all a chance to convert to continued customers in a higher line. There are a certain percentage of the customers that would be interested in the better line of clothing even though they had formerly been a low price shopper.
Customer relations management accounts for a starting point for the new products. By offering them a firsthand look and feel for the changes can help them to feel a loyalty to try out the new offerings. There will be a correlation between the amounts of satisfaction that the customer felt with the old products that will help to retain them as shoppers in the new store offerings. Customers who are more satisfied are likely to remain customers . It will be a starting place to build new customers.
CRM or customer relations management is a very important part of the sales team on the floor also. Once the customer comes through the door the sales team needs to provide a high end experience for the customer. some stores offer wine or coffee while the shopper is browsing. some stores will offer suggestions for the shopper as they sit and enjoy the surroundings. All efforts to make the customer enjoy the experience is important. Included in the redesign of the selling floor should be some space dedicated to the shopper to just sit and have the sales team make suggestions. High end shoppers will appreciate the added attention and the attention sets apart the shopping experience.
New Customer Acquisition
Acquiring new customers is a relatively common practice in online in the shares and likes are a measuring of the marketing effectiveness of a strategy. Gaining a new customer base for a brick and mortar store can use some of the effective tactics in gaining new customers.
One of the techniques that can be copied is the use of the customer loyalty and discount programs. Customers can be offered a coupon for a pre sale item. This technique gets people into the store in the first few days and offers a little discount on the items to reduce the price to a more acceptable level for the customers. These customers might be those of the recipients of the online promotion or direct mailing in the zip codes in the near areas.
Customer information can be collected at the point that they return the discount voucher with their name and email address on it. The email addresses that are collected are used to blast informational messages and to offer a chance for the customer to voluntarily offer information in the use of a survey or other form. Store credit cards are also important for the income guidelines that are necessary to target the higher income customers.
Many pieces of information are available in the area's demographic information contained in the county or cities clerk’s offices. They are a wealth of information about the area that can be translated into shopping habits.
In shopping experiences sometimes a one day only sale that allows only customers of a certain zip code a certain percentage discount can be effective. In that manner the store can collate the number of coupons returned in the promotions.
In the higher designer clothing arena sometime price is not the only selling inducement. Shoppers can be enticed to shop by the styles and offerings of particular brands. Price may not be as important as style and availability of higher and well quality items.
Competition
As said earlier the competitors in this marketing strategy are giants. Both Macy and Nordstrom are giants in the middle and high end designer markets. At the end of the year Macy announced that it is closing some of its stores across the country which may create an opportunity for a new face. However, the reason that Macy's may be closing is that in that market the people do not have a need for this product. The reasons for the closure may not be revealed to the new kid on the block but it is worth investigating. The other competitor, Nordstrom, has opened with great success a Nordstrom Rack, which is an off sale market for the brands that did not sell well in the regular Nordstrom stores.
Setting the stage for success in between these two customers lends one to look at the mobile and digital sites. Mobile marketing can be as easy as sending a text message for a flash sale or a coupon that is valid for a short period of time .
Conclusion
Marketing in an uncertain economy as we now enjoy is difficult and adding the complexity of high end clothing makes it complicated to another level. Using the same types of strategies employed in the past is not going to be as effective in attracting a new type of customer for the high end products. The best of the marketing will be social media oriented and oriented toward the upper middle class women.
Beating the competition is always a goal for marketing and the strategies of combining the snail mail with the innovative mobile and media marketing will offer the best of the benefits to achieve the desired results.
References
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Duggan, M. (2013). Demographics of key social netweorking platforms. [online] http://www.pewinternet.org/2013/12/30/demographics-of-key-social-networking-platforms/. Accessed January 2016.
Kundahl, E. (2016). Establish an Optimal Marketing Budget to Drive Growth. [online] https://www.businesscreatorplus.com/establish-an-optimal-marketing-budget/. January 2016.: Business Creator, Inc.
Verhoef, P. (2003). Understanding the Effect of Customer RElationship Management. [online] doi: jm_of_mark_2003.pdf Accessed January 2016: EBSCO .
