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Transcript of Levis
→ Most successful, widely recognized
→ Captured the attention, imagination and loyalty of generations of diverse individuals.
→ Launched in 1986, Dockers® brand products and marketing played a major role in the creation of a new apparel category.
→ Dockers® became the No. 1 khaki pant brand in the United States .
→ Today, the Dockers® brand has expanded to more than 50 countries in every region of the world
→ Launched in 2003 exclusively for consumers who shop in the mass channel.
→ The brand gives value-conscious consumers access to high-quality, affordable and fashionable jeans wear from a company and name they trust.
Two types of new entrants:
- High-end designer jeans manufacturers: The designer jeans came from fashion houses such as “Tommy Hilfiger”. Many consumers were willing to pay a premium price.
- Retail stores like Gap Inc., J.C. Penney and Sears started offering affordable jeans, which attracted the younger population.
Levi’s is stuck in the middle between their new rivals. 2. Repositioning
Levi’s began to be perceived as no longer being stylish and having lost touch with what consumers wanted.
Levi’s failed to respond to trends in the 90s instead of focusing on innovative strength. 1. Failure to Meet Fast Fashion Trends After experiencing more than a century of positive sales trends and market growth, Levi’s began to lose market share in 1996. There were several reasons that set off the downward trend, including a lack of innovation, failure to anticipate consumer trends and an influx of fashion forward competitors willing to do what Levi’s either couldn’t or wouldn’t. Identify the problem 3. Strategic Issues - Pursues Transnational Strategy: popularity in foreign markets and increase profit margins.
- Transnational Strategy requires location of its global production plants and to customize its products.
- Production facilities around the world, to produce at a lower cost and customize its products to local tastes.
- Foreign subsidiaries are responsible for marketing and distributing in the local area.
- The company also transfers information and knowledge abroad thanks to a network structure.
- Design and ethical standards are set in the US Strategy in the Global Market Competitor Analysis OPPORTUNITIES
Capturing emerging markets
Diversified product rang
Arising of new market segments
Total market for casual wear is growing
Saturation of the jeans market
Competition from products of the higher end of the market
Economic downturns in some countries
Fast changes in the consumer tastes
Local regulations on the advertisements in countries like India, china
Lack of protection of property rights
Increase in the local competition STRENGTHS
Strong Brand image
Global and customized products
Facilities at low cost location
Presence of foreign subsidiaries for
distribution & marketing
Strict production and ethical standards
High costs of brand protection
Lack of control over quality (licensing)
Sloppy in terms of keeping up with the latest trends in fashion SWOT Analysis Competitors were able to take from Levi’s market due to heavy advertising and branding. (Calvin Klein)
–– Celebrity endorsements
–– Up-to-date European product designs
–– Advertise jeans as “designer.”
Levi’s largest consumer market were Baby Boomers, the Levi’s brand was perceived to be “mommy jeans.”
Competitors Strategies 1. Introduction Introduction
Conclusion Table of contents Thank You - LS&Co had most of its early success because the firm was behaving monopolistically.
- Over the years, the company maintained profits by providing a wide range of products, capturing new markets, and increasing its market shares.
- However as more firms entered the market, the company started losing customers and incurring losses. The upstart companies captured niche market.
- Despite these reduction of sales, Levi Strauss & Co. maintained its corporate responsible image and progressive stance on social, labor, and environmental issues, which may have long-run profit opportunities but the company need to take into account seriously their strategic issue and resolve these problems. Conclusion 5. Conclusion 4. Recommendation Worldwide, there are approximately 750 franchised or other independently owned stores.
Stores are important vehicles for demonstrating the breath of product lines, enhancing brand image and generating sales. Entry Modes 2. Jeans industry and company analysis The innovation differentiated Levi’s jeans from others because of its increased durability.
Over the years, Levi’s jeans have become
Levi Strauss & Co. became the largest manufacturer of jeans, and profits reach $1 billion by 1974. Background: company growth Founded by Levi Strauss in 1853 primarily selling wholesale dry goods.
Founded in San Francisco.
Jacob Davis thought to use copper rivets to reinforce the points of strain.
Davis and Strauss purchased the patent in 1873. History One of the world's largest brand-name apparel marketers with sales in more than 110 countries.
Today, the Levi's® is one of the most recognized in the world and is registered in more than 160 countries.
The company employs a staff of approximately 8,850 people worldwide. Introduction Decline: people who buys Levis jeans today are the same people who bought them 40 years ago. Kids and teenagers don’t want to wear a pair of jeans that their parents think are cool. Levis inability to “keep fresh” has led to rise some other brands. Life Cycle Stages Prepared by:
Sunjoo Yong LEVI’S STRAUSS & CO.
2012.12.06. TEAM PROJECT Differentiation strategy Levis 501 Dockers Signature 1. Strategic alliances and licensing
- A series of strategic alliances with foreign companies to produce and distribute its products
- Gaining competitive edge in one way or other
- Create more Levi's products than just clothes 2. Fast Fashion -Extremely quick response system
- Vertical integration
=> Just-in-Time production, delivery and sales
"Quality Never goes out of Styles" 3. Customization “Personal Pair program”
As per local taste as different markets have varied needs achieve national responsiveness
It’s time to revival of the program strongly Low High Low High
Levi’s Strategic Groups Premium
Jean SPA There’re two main Strategic Groups in the jean Market.
SPA Brand which have low price and variety lines of products. SPA stands for Specialty (store retailer) + Private (label) + Appeal (brand).
Premium Jean: Expensive but delicate design which can supplement customer’s fault: Over 20 brands Strategic Groups Third Quarter 2010 Financial Results Net Income: $28 millions
Net Revenues: $ 1,109 millions Fortune 500 Ranking