Executive Summary
Marketing concepts represent valuable resources that can support marketers in designing marketing strategies for their products. The case of Ted Baker retailer in Leeds indicates how marketing strategies, such as marketing mix, segmentation or differentiation can impact the performance of its product, Ted Baker Bowicon Large Bag.
This reports analyses the marketing mix used for Ted Baker Bowicon Large Bag, with the purpose of identifying if the utilized blend of product, price, placement and promotion is suited for the examined product. Based on the identified marketing mix, the report further discusses the targeted segments and their compatibility with the product. This topic leads to addressing the differentiation strategies that the company approach for this product and to examining the compatibility between brand identity and targeted consumers. The report dedicates a section for examining Ted Baker’s ethical conduct for the examined product, aiming to address how the company’s behaviour influences its stakeholders.
The findings indicate that:
The marketing mix for Ted Baker Bowicon Large Bag is currently inconsistent with its brand identity and the high end market segment;
The targeted segments are currently clashing because of a marketing mix that requires revising either the price or the promotion elements;
The product’s design and its price, plus other specific features provide an effective differentiation for Ted Baker Bowicon Large Bag;
The company applies and encourages ethical and sustainable conduct, but it can do more in this direction by departing from the practice of using animals for its products;
Marketing Mix for Ted Baker Bowicon Large Bag
Introduction
Ted Baker is a popular retailer in Leeds, covering various fashion needs that include clothing and accessories, lifestyle and entertainment goods or gifts (Ted Baker official website). Currently, the retailer promotes major discounts in most of its shopping departments, applied in-store, but also in other locations where its products are being commercialized, such as department stores. This report focuses on the clothing and accessories department available at Ted Baker, choosing the handbags, namely Ted Baker Bowicon Large Bag for analysing its marketing mix, segmentation, targeting, positioning and its environmental impact, further providing recommendations for improving the product’s performances.
Marketing Mix
Marketing mix defines the strategy that a firm develops for promoting a product or brand, implementing specific actions and tactics for outlining the product’s qualities, emphasizing its value in relation with its price and highlighting its placement for effective visibility and accessibility (Lamb, Hair and McDaniel, 2012). Product, price, placement and promotion are the four Ps that organizations mix for delivering their marketing mix (Armstrong, Adam, Denize and Kotler, 2015).
For this Ted Baker bag, the retailer’s marketing mix consist in strategic positioning, highlighted discount, product quality, yet niche promotion. This product falls in the glamorous category, as it is elegant and shiny, having a patent finish and a metallic bow that gives it a distinguished, yet girly look. However, because it looks like a gift box, due to its cubical shape and the dark – golden bow that accessorizes it, the bag is also non – conventional. Therefore, the main attributes of this product are its patented finishing, its glamorous feel and its non – conventional look. The brand, Ted Baker London, also contributes to emphasizing the refinement of this product.
The price element offers indications about products’ market positioning, but also about the chosen marketing strategy (Armstrong et al., 2015). The bag is sold for €39.00, but it is currently on sales and available for €27.30 in department stores such as House of Fraser. Variations of this bag can be found on various colours and dimensions, with a similar price discount. The price for this Ted Baker bag suggests that it is a mainstream product, because it can be affordable to medium and even low budget households. The glamour aspect of the bag would indicate that it is targeting a certain type of market, the sophisticated high end segment, while the price element demonstrates that the product is affordable, hence, targeting the mainstream market. This interaction indicates a vertical strategic group value, because the product exhibits both the value of elegant style and affordability (Lindgren, 2011). The current discount further highlights the price element, optimizing the sales of this product by further accentuating its affordable value.
In terms of placement, the Ted Baker Bowicon Large Bag is displaced in the physical location, benefiting of retailing strategy that emphasize its discount. Moreover, the product is available online, through the company’s website, having the option of being purchased online and delivered to customers. In the virtual space, the product also appears integrated in advertisements, due to its cookie incorporated feature that suggests websites visitors this product, among others similar (Armstrong et al, 2015).
The promotion of this product is subtle, despite the fact that it is a mainstream product. The product is presented in pile, with other similar products from Ted Baker. Online, the bag benefits of customized virtual promotion, which appears as a result of users’ search of this product via the retailer’s website. Other promotional elements are not available.
Lamb, Hair and McDonald (2012) state that the role of promotion in the marketing mix is to inform, educate, persuade and remind consumers of a product that could satisfy their needs, while increasing the sales of that product by emphasizing its qualities. This is an exchange with mutual benefits. Nevertheless, when analysing the marketing mix of Ted Baker Bowicon Large Bag, the actions for educating, persuading and reminding people about this product seem to lack. The promotion for this product is limited to informing about the price. However, there are other elements that could be emphasized for persuading the customers to purchase it, such as its connection with a luxury brand, its design or the patented finishing.
Nevertheless, the company has a policy of not using advertising for promoting its products, replacing advertisements with direct marketing strategies, such as consistent give-aways, mostly dedicated to retain the existent customers (Ted Baker official website).
Targeted Segments
Segmentation is the process through which marketers divide an entire market into smaller groups, called segments, which allow them to group consumers based on common traits, creating homogenous divisions that can be addressed through a customized communication (McDonald and Dunbar, 2012). The purpose of segmenting markets is to identify the most profitable segments and target them through marketing mix strategy (Pride and Ferrell, 2010). Considering the fact that Ted Baker London is a luxury brand, the examined product falls into the same category. This would normally suggest that the bag is aimed at high end segment. Nevertheless, the price of this product, £27.30 on sales, indicates that it targets a wider audience. On the other hand, the fashionable and trendy design of the bag suggests the it is aimed at the luxury segment. Because both segments have a high potential for purchasing this product, they are both aimed by the marketers of Ted Baker Bowicon Large Bag.
Differentiation
In an intense competition, companies seek to make their products more appealing than the similar offering of the competitors, through product differentiation. Product differentiation allows companies to increase their market share by providing a higher quality product, with superior or more sophisticated features, compared with their competitors (Hill and Jones, 2008).
While analysing the product in terms of differentiation, at the first sight it would appear that the price differentiation is approached. Nevertheless, considering the fact that the product is aimed both for the luxury and for the mainstream, more affordable segments, its differentiation should be analysed in relation with competitors activating on both of these market segments. For the luxury segment, the product competes with Burberry, Alexon Group, Michael Kors or DKNY. For these competitors, the product uses price as a competitive differentiator, in addition to its non – conventional style and patented finishing.
For the mainstream segment, the product differentiates in terms of quality and design. This is a luxury product, sold for an affordable value, which makes it an affordable luxury (Carvalho, 2015). On this market, the product competes with mainstream brands such as Mango, Zara, Bershka, Koton, etc. On this segment, the product also benefits of price differentiation, in addition to product differentiation, because it includes a substantial discount, down £11.7 from £39, which makes it cheaper than many bags available at Zara or Mango (Mango Great Britain official website; Zara official website).
For both segments, the product distinguishes from its competitors through its unconventional appearance, providing customers with more than a handbag, but a bold product that has the potential of setting the trend through its black – golden stylish bow that contrasts with the shiny dark texture of the cubic bag. Considering the fact that the product differentiates from its competitors on two different market segment, using clear differentiation elements, such as design, price and finishing, Ted Baker Bowicon Large Bag is clearly differentiated from its rivals.
Brand Identity
Ted Baker is a luxury, classical brand that shapes the lifestyle in United Kingdom and internationally through sophisticated and original products. The brand is called “No Ordinary Designer Label” because it is playful, with its own personality, carrying the sense of humour of its founder, Ted Baker (Ted Baker official website). The uniqueness, originality, sense of humour and bold statement situated beyond the social conventions represent Ted Baker’s signature, visible in the Ted Baker Bowicon Large Bag’ design, accessories and finishing. Is it a handbag or is it a gift bag or both? The product is surprising.
This brand identity fits perfectly with the unconventional consumer. The unconventional consumer requires uniqueness and wants to stay out of the crowd. However, for creating a unique product, in fashion world this often requires unusual sewing, materials or creative designer, which becomes expensive for a mainstream consumer (Pride and Ferrell, 2010). This is why, in general, Ted Baker’s products speak better to the high end segment than to mainstream. Nonetheless, the analysed product approaches the non-ordinary consumers regardless if they are wealthy or gain a median income, because the price is affordable. On the other hand, the affordability can determine other consumers, who do not associate with the values of uniqueness and boldness imposed by this handbag, to purchase it just because it is affordable. In this situation, the Ted Baker Bowicon Large Bag would become a random bag instead of a statement of unconventionality. From this perspective, the brand identity does not relate with the mainstream market.
Ethical Conduct
Pressured by various groups and non-governmental or governmental bodies to adopt environmental sustainable practices in order to reduce their impact upon environment, organisations nowadays are developing codes of conduct that dictate principles of ethical behaviour (Levine, 2013). Ethical conduct is also understood as the standard behaviour that upon which conduct is judged (Lamb, Hair and McDaniel, 2012).
Ted Baker applies an ethical behaviour in its commercial conduct, being actively involved in waste management, resource optimization, reduction of carbon emissions, incorporating sustainable materials for prolonging the lifecycle of its products (Ted Baker official website). Through its website, the firm also advises its customers to develop an environmental consciousness by managing their waste and purchasing sustainable products. Therefore, the organization drives an ethical conduct that affects its clients and its suppliers, as it only purchases materials that are sustainable.
What is concerning at this point, is the fact that the company uses animals for designing its products, which is an unethical conduct, as they are harming animals instead of using alternative products to leather or fur. By using animals to produce its products, the company encourages suppliers, consumers and employees to harming animals. Nevertheless, the analysed handbag is not made of animal resources, but of polyvinyl chloride, hence, it is not an exponent of the company’s unethical conduct towards animals (Ted Baker official website).
Recommendations
Ted Baker approaches a niche marketing mix, although its product, Ted Baker Bowicon Large Bag, addresses to mainstream market, judging on the price of this handbag. There is an inadvertency between product, promotion and price in this handbag’s marketing mix, which means that the company needs to revisit its marketing blend in order to be more effective on its market segments. While the product appears to be aimed at sophisticated customers, interested in good taste original products that define a different lifestyle. This description matches the high end segment. Moreover, the promotion, which implies the absence of advertising and commercials, is niched on the luxury segment as well, because the company focuses on retaining its existent customers by investing in customer loyalty packages. On the other hand, the price element of its marketing mix targets mainstream consumers in addition to high end consumers, which generates a marketing clash.
Attracted by the affordable prices, the mainstream consumers would purchase this handbag, while the luxury consumers would purchase it for its original design. However, this product does not communicate to the mainstream consumers, because it does not use advertising or other channels available for Ted Baker non-regular customers. From this point of view, the company should focus on targeting solely the high end customers and revising upwards the price component, which better fits its brand identity, or continue targeting the mainstream segment, but increasing the promotion component through advertising.
In terms of ethical behaviour, using animals for creating fashion items is not unusual in fashion, but it is immoral, because it implies hurting animals for the benefit of people. The company needs to depart from this practice, standing up for its “No Ordinary Designer Label” by using other fabrics than the ones produced by animals, and influencing its stakeholders to avoid hurting animals for personal gains.
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