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GAP inc

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by

Anastasia Brard

on 13 May 2015

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Transcript of GAP inc

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Entering a new market: India
CONTENTS
GAP
Threats
There are already several other apparel companies in the market which means Gap will have to have a strong marketing campaign when they open.

India is an easternized market which will be incredibly different than most companies Gap has tried to open in
Opportunities
Huge potential in the apparel industry as it is rapidly growing.

India is among the most influential countries in the region, neighboring countries will follow fashion trends and will want to buy Gap's clothing

Rising Urbanization means more people will be exposed to Gap's marketing.

Weaknesses
Some of the population in India still keep to wearing traditional clothing and will not be interested in buying Gap's clothing.

Although the population in India is enormous, only around 30% of the population is urban which makes marketing to the more rural areas difficult.

They will be competing with several other companies for market power


Strengths
Individualism
Long term orientation
The propensity towards perseverance
India demonstrating a stronger long-term orientation than US
Pragmatic culture
Encourage thrift and efforts


Indulgence
Power Distance
Degree of acceptance for inequalities
High score for India versus low level for US
Strong hierarchy in India
High level of inequality in wealth and power
India
South asian country​
Second most populous country​
Constitutional democracy​
Four principal religions​
Official languages:​
English​
Hindi
Indian Apparel retail
Highly fashionable country​
Westernisation of India
High market capitalisation​
Strong contribution to the economy​
Results
Challenges:
Corruption problem
Bureaucracy
Neighborhood
Infrastructure
Cultural differences
Law's restrictions
Influential member
Marketing Mix
Zac- History of Gap, Marketing Mix, SWOT analysis, Influential leader

Anastasia- PESTLE analysis, Cultural beliefs and values

Kimberley- Branding and Advertising, Current Gap marketing campaigns, introduction of Gap into India, Analysis and recommendations
Founded in 1969 by Donald and Doris Fisher

Small store from San Francisco, now globally recognised in over 90 countries

3200 stores worldwide and connected to Old Navy, Banana republic and Athleta

Gap like most apparel stores is a mix between online retail and physical stores
Product
Gap is a casual clothes company, which provides many different designs, ranging from outerwear, active wear and other accesories.
Price
The pricing of gaps products is in the moderate wholesale price zone, which may prove too expensive for most of the lower class people in India. But with an increase in disposable income and a rapidly expanding middle class it will become much more affordable for many consumers.
Place
Gap is available around the world in several different countries but is based in the U.S

Moving into India will be a huge challenge for Gap as they try and adapt their product to the locals liking
Promotion
Gap's promotional campaign in America has been strong, and is one of the leading retailers in the U.S.

They have developed themselves over the last 80 years as a popular casual brand.
Indian culture
High context culture
Importance of religion
Family oriented
Importance of traditions
Long term relationship
Greetings

Level of integration into a group
India is a collectivist society
Strong cohesiveness
Emphasis on family values
India is a culture of restraint
Tendency to cynicism and pessimism
Actions are restrained by social norms
Indulging themselves is wrong
Political and Economic factors

New government
Bureaucracy
Corruption and bribery
Strong GDP
Advantage over competitors
English-speaking population
Social and Technological factors
Population growth
Culture differences
Assimilation of new trends
shift towards online retailing
Strongest IT sector in the world
Competitive market


Environmental and legal
factors
Old legal system

Doing Business Ranking

Legal procedures complex

FDI’s restrictions

Climate and infrastructures

Labor
Opportunities:
Strong GDP
Large population
IT developed
Western influence
Democratic system
Cost leadership
The apparel industry in India is growing rapidly and is expected to become four times bigger by 2025.

The middle class in India is expanding, which means stylish clothing will be more affordable with more disposable income.

Gap's previous campaigns in other countries have been successful

Younger more westernized Indian's will want to buy clothing from Gap


Strong experience and leadership is crucial for a company to succeed overseas, this is why Gap has hired Oliver Kaye as the head of business in India as he has already spent two years in India working for Calvin Klein, so he has experience in India and specializes in the apparel industry.
Current Target Market

Demographic/Geographic Segmentation
Men and Women
Aged between 17-35 years
Middle-upper class income
Minorities included ie. Asian, Hispanic, African American etc.
Reside in urban and suburban areas

Pyschographic Segmentation
Career orientated
Active/energetic
Sophisticated
Stylish
Omni-channel Retailing
Goals of Current Marketing Campaigns
Increase consumer traffic to online store
Encourage use of android devices to access store
Increase e-commerce sector
Online Offerings

In store shipping
Find a store locator
Reserve in store feature
Customization of merchandise
Western vs. Indian Approach In Retailing
Western Approach
Huge infrastructure
Complex supply systems
Organised

Indian Approach
Retail highly fragmented
Small independent shops
Unorganised
Can GAP be successful in India?
Indian Marketplace
GAP's Target Market relative to India
Over 500 million Indians under 30
Purchasing power in younger generations dramatically increased
Huge demand for modernised lifestyle products ie. smart phones, apparel, accessories etc.

Retail Sector
Retail sector is India's largest industry
Accounts for over 10% of total GDP
Modern retailing emerged
Increase in large scale retail infrastructure
Challenges of Implementing Current GAP Marketing Strategies
69% of Indian population still reside in rural areas
Reaching rural consumers major concern
GAP products are not as easily accessible as traditional points of sale
Solutions
Over 39 million online buyers in India
Expected to increase to 128 million by 2018

India largest purchaser of smart phones for new users
Over 27 fold growth each year
GAP can be successful if they:
Continue to drive omi-channel shopping
Contine to target Generation X & Generation Y
Encourage use of e-commerce offerings via promotions, vouchers etc.
BUT MOST IMPORTANTLY
Ensure cultural sensitivity
Adapt to suit norms & values of consumers
Strategies and market research
Full transcript