Marketing Analysis
Harrington Collection is a retailer and manufacturer of female’s apparel has suffered loss because of poor sales and low margins. The company is now considering option of an active-wear production line, and is expecting that it will conclude poor performance and poor sales of the company. In this regard, active-wear is appropriate with rigor division. In the rigor division, the target market is females of ages between 25 to 50 years, and has an average household income of more than $75,000. The company found via surveys that people who are loyal to brand were enthusiastic and interested for new line of active-wear. The trend was especially more evident in the population of baby boomers, who desire clothes that do not make them feel aged or old. The active-wear, however, adjust with the vigor division because making an entry in the segment of an active-wear in Vigor Division under improved and better classification of products presents opportunity to the company to increase its sales as well as profitability. Vigor division is selected because the revenue of the company was decreasing, and new division of the company will, however, incur increased cost.
Additionally, possible influence on Vigor Brand name is positive as active-wear come under an improved and better category in the Vigor Division, and it will not exert any negative impact on the brand image. The company also has many other divisions in order to cater high end customers in a better and effective manner. In this regard, push promotional strategy is effective for the company to launch new volumes in active-wear category. Furthermore, it will become possible for the company to get constructive and positive response from Research and focus groups. The market is showing positive attitude towards casual wear, which will help the company to continue its current clothes line, pricing strategy, and distribution strategy of apparel that it is offering.
The introduction of active wear brand by Vigor division of the company will help it to compete more effectively and fiercely in order to acquire more market share and eye-catching shelf-space in several retail stores. However, in the United States, the Apparel industry is concentrated in a moderate manner, and there are several companies that are already conducting their business, and have gained significant market share. The potential customers and retail traders will react by ensuring integration in vertical and horizontal manner, and they will also react by reducing the prices of products. They also have to outsource in order to achieve reduction in the prices of products. The competitors will also adopt more responsive attitude towards customers. Harrington Collection has already skilled employees for responding to queries of customers in a effective manner. The company also has store that is completely owned by it. Further, they will adopt more push strategy in order to create product awareness of their existing products; they will focus on launching new designs in active-wear category, and form associations with the retail channels.
There are, however, probable channel conflict issues, and they can arise because of the availability of competitors. Conflict may also occur due to better and affordable prices with the same channels because companies start competing at the same price, and the sale will be dependent on the choice of customers. They will also arise because of moderate price and expansion of channels.
