Athleta is a well-known brand in the world of athletically active women. The company has been around for over 30 years and has grown exponentially in that time, but what exactly are they targeting? This essay will discuss athleta’s target market and why it makes sense to be focusing on this group of people.
Athleta Inc, a company specializing in women’s sports clothing, is planning to extend its operations in the foreign (Canadian) market. The strategy contains broad characterizations of the macroeconomic environments in all three of the initially considered countries. It also explains present trends in Canada’s apparel retail sector and offers readership with information as to what factors should influence Athleta Inc.’s marketing plan for the targeted market.
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Athleta Inc. is a retail business that specializes in selling women’s activewear apparel and gear. The company was formed in 1998 and operated as an internet-only firm until 2008, when it was bought by Gap Inc. Athleta is focused on female customers aged 35 to 54 who are physically active and environmentally aware. In 2015, the number of Athleta stores in the United States numbered 95, with just two located in Britain.
In 2014, the firm’s net sales were more than $600 million. The store managers decided to continue with Athleta’s market-expansionist approach and offer Athleta-branded goods in a new foreign country following the success of Athleta’s entry into the British women’s sporting goods market. Kenya, Bangladesh, and Canada were among the first countries to be considered. PEST-based overviews of external macro-environments in:
Kenya is among the most politically destabilized nations in Africa, which reflects the fact that Kenyan society continues to be divided along tribal and religious lines. Despite the fact that Kenya’s economy has been growing steadily (1-2%) throughout 2011-2015, it did not prevent the majority of citizens from becoming increasingly impoverished. In Kenya today, 55% of people are poor.
Kenya has also maintained its position as one of the world’s most corrupt countries. One of Kenya’s fundamental qualitative characteristics is that it maintains traditional (patriarchal) beliefs, with just 7% of Kenyans belonging to the middle class (Owiti 550).
Bangladesh, with a population of 160 million people and steady economic expansion (2-6% per year), is increasingly attractive to global investors. Bangladesh, on the other hand, is still a politically volatile country in which 40% of its citizens live in poverty. The continuing ethno-religious conflicts between Bangladeshis, which jeopardize technological development in this nation, exacerbate the social fragmentation problem. Bangladesh is no exception. As in Kenya, the middle-class stratum there is virtually non-existent, and most people adhere to traditional values (“Research and Markets” 247).
Canada is a well-developed and politically stable nation with the servicing sector accounting for 72% of GDP. Even though Canada has a population of just 35 million people, it is highly urbanized and endowed with a high purchasing power, which is due to the fact that the country’s living standards are expected to be among the world’s highest.
Since 2011, Canada’s economy has been on a continuous ascent (“Research and Markets Adds” 29). The majority of Canadians subscribe to the ideals of an intellectually open-minded/environmentally gentle way of life. Based on the provided insights into Kenya’s, Bangladesh’s, and Canada’s macro-environments, it was determined that Athleta would benefit most from selecting the latter.
Market research. Porter’s Five Forces analysis.
In terms of competition, the threat from new entrants is significant. The reason for this is that: a) The barriers (such as legal, economic, cultural, etc.) to entry into this market are quite low; b) it will not take much money to establish a new player on the market.
Buyer power is strong. There are two elements that contribute to this condition – a) The greater extent of consumers’ purchasing independence, and b) the fact that it is easy to change suppliers.
Supplier influence – extremely weak. The contributing factors are a) A highly defined “division of labor” within the apparel industry in Canada; b) Substitute inputs being readily available. Substitutes are not a major concern. Even though Canadian women are free to pick any style they choose, their options for switching high-quality sports clothes with other items of the same type are severely limited.
Moderate degree of rivalry. This is due to the fact that, while there are many competitors in the apparel market in Canada, they operate under a number of formal and informal restrictions that dampen rivalry intensity (“Apparel Retail Industry Profile: Canada” 13-18).
SWOT analysis (concerning Athleta’s expansion to Canada). Strengths
Athleta provides a variety of uniquely designed women’s clothing, many of which are constructed of the firm’s hi-tech textiles, such as the one with silver salt in it. Athleta prices its items at reasonable rates.
Athleta has yet to establish a presence in Canada, despite having registered the brand name there. The present USD-to-CAD exchange rate makes it difficult for the proposed growth to succeed.
The sensitivity of Canadian women to the ‘perceived’ (lifestyle-related) value of clothing, which makes them a true target for Athleta, is one reason to expect the targeted market’s growth to continue.
Athleta will confront a lot of competitive rivalry in Canada, from firms like Nike, Adidas, and Lululemon Athletics, who have already gained a considerable market share. The depreciation of the CAD is expected to continue in the future.
The Canadian apparel retail sector is anticipated to expand at a rate of 3% each year from 2016 to 2019, which should help Athleta maintain its place in the market. Furthermore, because the relevant statistical information indicates that more and more Canadian women are becoming more comfortable with the notion that a specific piece of clothing may be worn for both casualwear and sports-related activities (21), the firm should benefit.
Retailed products. Description
“Power to the She,” Athletea’s tagline, aims to empower women who spend most of their time “on the move” in terms of allowing them to integrate their professional and active lifestyle goals into one.
The activewear line of Athlete’s includes a range of goods for all athletic activities and seasons, including yoga and indoor apparel, running and high-performance clothing, ski & snowboard apparel, winter outerwear and sweaters, yoga accessories, and footwear. The company has also started to sell menswear merchandise recently (3).
The most evident feature of Athleta-branded apparel is that, in addition to being highly durable, they are also very fashionable, which should appeal strongly to the potential targeted customers. This was made possible by Athleta’s commitment to employing the most scientifically advanced materials available, such as Pilayo and Power Pilayo, which are both patented fabrics. Athleta sells a wide range of sizes for its apparel and accessories. The company provides several special discounts to customers.
The following is a list of objectives that Athleta wishes to accomplish in the next year after entering the Canadian market for women’s activewear apparel:
To create a solid foundation of brand-loyal consumers. To ensure that at the conclusion of the specified time period, at least 50% of customers in the target market are aware of the brand name and all its values. To establish a good reputation as a socially concerned business.
The intended client-audience of Athleta’s is defined as “women who are seeking for a unique method to connect with themselves and their bodies in order to achieve self-actualization” (Athleta). In this case, the typical purchasers of Athleta-branded goods are most likely to be professionally active and holistically inclined (yoga) women who continue to maintain a high level of fitness well into their fifties.
Even though there is no data suggesting a percentile ratio for this sort of customer in the Canadian women’s activewear clothing market, we can infer that it is significant. The commercial success of rival companies (Nike, Lululemon, etc.) supports the validity of this hypothesis (Lazarus 25).
Suggested marketing approaches. Niche-focused
It will be entirely natural to presume that Athleta should take advantage of the niche-focused marketing approach due to the aforementioned characteristics of its target consumer-audience. In this case, Athleta will need to figure out how the audience’s psychological preconceptions are linked to purchasing behavior, as well as continuing efforts to ensure that store apparel is seen distinctively different from those offered by rivals (Toften and Hammervoll 278).
Athleta has a long history of providing cheap prices, which is something that hasn’t changed one bit today. Athleta’s rates are 20-30% lower than those of Lululemon and Nike when compared to the same lines of goods from other companies. If Athleta follows through with its pricing policy in Canada, it will be able to increase its customer base while also enhancing the company’s corporate reputation (Sharma 133). The relevance of this marketing approach may be further investigated with reference to the essence of Canada’s contemporary socio-economic circumstances, which are impacted by the continuous deterioration of CAD.
The first Athleta store will be located in Vancouver, British Columbia (Robson Street), near to Lululemon Athletics’ location. This site, as previously said, will provide a steady inflow of traffic, especially considering the proximity of the competition’s premises. The retail area is 1500 square feet, which should be sufficient. On weekdays, the store will be open from 9 a.m. until 9 p.m., and on weekends it will be open from 11 a.m. until 5 p.m.. There will be three salespeople on staff on the ground floor during normal business hours.
Athletea’s marketing plan will be focused on prioritizing long-term commercial goals and employing a small number of marketing strategies at the same time. The primary effort will be devoted to advertising the company’s products in a conventional and unorthodox manner (‘word-of-mouth’), as well as providing customers with various incentives to remain loyal to the brand name. Customers who visit the store will also be eligible for large (up to 50%) discounts while shopping there.
Monitor and control
There will be two monitoring and control systems in place to monitor and regulate the progress of Athleta’s entry into the targeted market – analyzing customer comments and measuring monthly sales amounts. The decision to use this particular monitor and control method is based on the assumption that these indicators of company operational efficiency are closely linked, according to Athletas’ corporate strategy.
$150,000 in equity capital and $110,000 in various loans will be used to fund the investment funds. It is anticipated that by the end of the fiscal year one, completed sales will exceed $230,000 as a result of what we know about running a women’s activewear store in downtown Vancouver and the company’s products’ qualitative characteristics. This means Athleta’s recently opened location in Vancouver should soon turn profitable.
In light of what has been said thus far, Athleta’s planned growth in the Canadian market for women’s sports apparel appears to make perfect sense. By both: the predicted market’s genuine demands and the fact that, as experience demonstrates, the amount of a clothing chain’s commercial success is related to how willing managers are to keep pursuing an expansionist strategy.
GAP, Inc. is a global fashion retailer that sells men’s accessories, personal care goods for both men and women, as well as children’s apparel under the names Gap, Banana Republic, Old Navy, Piperlime Athleta and Intermix. Maternity clothing and sports and fitness related items are also available from the firm (Businessweek.com 2014). The business was created by Donald and Doris Fisher in 1969.
This was due to the fact that Donald could not discover a pair of jeans that fit him properly. As a result, Fisher decided to sell clothes rather than buy them. The GAP retail subsequently thrived, expanded, and gained global dominance (Farfan, 2013). It is clear from this that the organization’s main objective and goal is to offer goods that are in line with its clients’ preferences.
In between 2004 and 2011, the firm misplaced its focus on its main objective, instead focusing more on financial aims, which caused it to fall. Stock prices, poor profit margins, and a decline in popularity were all indicators of this. The company has since made a significant turnaround by changing its attention from financial to consumer-based satisfaction, which has helped it reclaim its position as one of the best brands in the world.
In the third quarter of 2014, Banana Republic recorded its highest sales since going public in 2000. Overall, net sales increased by 10% to $1.33 billion from $1.21 billion last year (Businessweek.com, 2014). The company’s headquarters are in San Francisco, California, and a new member to the management team has been announced. Marissa Webb has been named Creative Director and Executive Vice President of Design at Banana Republic, beginning April 28th (2014 Businessweek). 3,100 stores in 90 countries and 350 franchise outlets in 90 nations make up the company’s business. The firm is able to reachh millions of people across the world through its company-owned locations, franchise outlets, e-commerce storefronts, and catalogs.
Goals and objectives- This firm’s major objective is to satisfy the client’s tastes and requirements. As a consequence, this compels the firm to stay up with current trends in society, making it its primary aim. Because the firm sells apparel as one of its goods, it must offer clothes that are fashionable at the moment.
Strengths- It has a worldwide brand recognition due to its company-operated stores in addition to franchise locations. The introduction of several brands, such as Gap, Old Navy, Banana Republic, Piperlime, and Athleta, has increased client and vendor base popularity for the firm.
Weaknesses- The biggest vulnerability for a large firm such as GAP would be control of the business, given the growth in various branches across the world. As a result, management’s job gets more difficult.
Opportunities- The company’s management team has a variety of people on board who can assist the firm stay on track with current trends. E-commerce services also help to increase overall sales for the firm because to the advent of online storefronts.
Threats- A multinational corporation such as GAP is continually under attack from a variety of risks in its regular operations. Some of these obstacles include;
Keeping up with current cutting-edge trends is difficult because of the influence of changing consumer tastes and demands, as well as new trends in fashion.
The firm has evolved to the point where top executives are having trouble keeping track of the many divisions and departments throughout the world.
The size of the firm is a major obstacle to the implementation of new and innovative ideas. The development of highly competitive apparel retail markets such as Abercrombie & Fitch.
Gap analysis of Gap Inc.The degree to which a company’s potential and actual performance compare to one another, as well as the amount of inputs allocated relative to current allocation, is referred to as gap analysis (Jennings, 2000). Gap Inc. is one of the world’s largest retail firms, with numerous difficulties in order to maintain its position at the top of the market. Despite management’s and employees’ efforts to accomplish this goal, there are flaws in the system that impede its execution. The following are some examples of these gaps:
New stores are expected to open in Europe and China. The firm has intentions of establishing outlet shops in Asia and Europe. Italy and China are two regions where plans are under way to establish the company’s first store. This is an opportunity for Gap Inc.’s huge customer and vendor base to grow, but it also creates a hole because Asia and Europe have distinct cultures and beliefs from those of the United States. As a result, employees must be trained (Marston & Modarres, 2002) in order to comprehend the conditions for working within Gap Inc.’s rules and regulations.
Communication between employees and management, as well as customer-to-company communication. Employees require communication training to enhance their communication abilities. This will assist them in developing positive relationships with senior managerial personnel and with one another, allowing for faster action in the event of an emergency or new lucrative ideas. Customer care services delivery efficiency will also improve as a result of this.
A reliance on third-party providers. The majority of the items are reliant on outside vendors in other countries. This leads to delays in supply, a scarcity of goods, and higher production, storage, and supply expenses. To avoid waste due to unpredictable expense connected with shipment and storage, these third-party suppliers require training.
It’s difficult to keep up with the current trends in the market, which is evident throughout the firm’s decline between 2004 and 2011. It was said that the company’s products were not attractive to ladies at the time. The firm may partner with an art school to promote some of its items under its brands in order to follow new trends. This helps create new goods by encouraging innovation among designers.
Training Needs Assessment
Due to the large size of the firm, interviews and questionnaires would be the most effective tools for this purpose. Because not all workers or supervisors can be interviewed, conducting separate interviews with branch managers from various locations is necessary. Interviews may be more successful if conducted via video conference over the internet in order to interview branch managers from across the world.
A questionnaire might be a good idea for customers who use online-based stores. Customers in physical locations may be provided with a questionnaire when purchasing goods or given a website link where they may rate the company’s performance and services when available (Royse, 2009). This efficiency assessment would be successful if the findings are considered and changes and implementation are implemented right away. This will assist the organization in improving the efficiency of its services while also staying on track with current developments.
This firm’s personnel training program would be team building. This is because, as the name implies, team building unites workers in order to work together and improve communication between them. It also aids in the resolution of internal conflicts among employees and management. To enhance customer care service delivery efficiency, customer service training would be necessary.
The firm we picked to perform our project is Old Navy. The objective of Old Navy is to be the Provider, Partner, and Employer of Choice. Their ideals, as determined by 600 company leaders, are as follows: Service Excellence: Serving others – our reason for existence. We strive to understand the needs of everyone who relies on us (our patients, doctors, and fellow teammates) and then exceed all expectations.
In the 1970s, the then-president of American University in Paris, André Rouart, wrote that according to mythology and legend from around the world there comes a time when all life on earth will be renewed. At some point after this date it is said that humanity will enter a new golden age where people live in peace and prosperity with technology.
For the first time, Gap has opened a store in Syria. For example, as of July 31, 2007, they announced plans to open 230 store locations with a weighting towards Old Navy (www.gapinc.com). In 2004, Gap had a supplier base of 1,000 and 3,000 factories in more than 50 countries (www.proquest.umi.com). Products are produced in the United States and El Salvador among other places around the world. Gap Inc.’s garment industries span across 60 nations from Sri Lanka to Lesotho; from the United States to El Salvador (www.gapinc.com/public/social responsibility).
The most factories are found in Greater China, with 247; India, with 297; and Southeast Asia, with 382. The true number of factories used is 1,340. Fabric mills are chosen and tested regionally (www.gapinc.com/public/social responsibility). During the fall of 2007, Old Navy items were advertised on four major television networks as well as CW programming such as Ugly Betty; CSI: Las Vegas; and The Office . Spots were also aired on cable TV stations including MTV , BET, Fox Family Network.
In Canada, where Old Navy has stores in the Greater Toronto Area and seven more in Quebec, advertising on national networks such as CTV and local Canadian channels (ww.gapinc.com/public/documents) is permitted. A recent press release reveals the introduction of a new winter collection from Old Navy, called Women’s Plus, which is exclusively available online. The online shop offers a wider range of fashion clothing than before. In addition to free delivery on purchases worth $50 or more, the site also provides flat-rate shipping of $5 anywhere within North America