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NYC Subway Line

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by

Emily Bliss

on 23 October 2012

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Transcript of NYC Subway Line

NYC Subway Line Problem: NYC Subway Line has the choice to either remain in the well
established New York City gift market or continue the attempt to
establish the brand in the urban-chic lifestyle apparel market. Five 's Company:
NYCSL born in 1995
Clothing and accessories with NYC Subway Line logos
Owner and CEO Lynne Lambert
Reached benchmark $1 million in annual sales in 2008 Customer:
Anyone who likes NYC and is looking to purchase a gift
People who like urban chic fashion clothes and believe NYC Subway is that
Retailers who sell gifts from NYC
Apparel stores who view NYC Subway Line as urban chic fashion Competition:
NYC gift market apparel
Department store clothing
Urban-chic higher end apparel Collaborators:
Metropolitan Transportation Authority (MTA)
New World Sales, sales agency
Brooklyn, India, China Context:
Gift market is a large tourist destination
Low barriers to entry in apparel and accessories industries
Highly competitive SWOT Analysis Porter's ive Forces Supply Chain Sourcing Low Cost Regions Outside the US: Mexico
Caribbean
Central America
Asia Domestic Manufacturing Distribution Wholesale
Catalog
Internet
Overseas Wholesale Retail National Broad Line Retailers Macy's Lower Prices Off the Mall Stores Target & Kohl's Veritcally Integrated Specialty Stores GAP, Old Navy, Banana Republic, Express, etc. Gift Store Retailers New World Sales Reps
Difficult to find, and expensive Catalog & Internet 65% of total apparel, footwear, and accessories in 2006 Dramatic increase in Internet sales in 2007 and continues to rise Overseas Japan NYCSL products saw high sales volumes almost equal to that in the United States Japanese company wanted to sublicense her designs but Lynne could not obtain an international license to do so Interest from Japan decreased significantly in 2008. 1.)Risk of entry into the industry by potential competitors. Low barriers to entry
Large risk
Unlicensed illegal sellers 2.)The intensity of rivalry among established companies within the industry. Market competition is high
Many different buyers and sellers
Competitors are established in the market 3.)Bargaining power of suppliers. Power of suppliers is low
Suppliers are outsourced to other countries
Glad to do business with U.S. firms
High levels of profitability because of low labor cost and less regulation 4.)Bargaining power of buyers. With large apparel retailers such as Macy's power is high
Small gift shop retailers have less power over PSA and price
Final consumer has little power unless they become a united force 5.)Closeness of substitutes to the industries products. The industry is apparel so there are very few close substitutes to worry about. Problem: NYC Subway Line has the choice to either remain in the well
established New York City gift market or continue the attempt to
establish the brand in the urban-chic lifestyle apparel market. Problems with Distribution Securing beyond the tourist gift market is a constant challenge
Retailers have dozen of lines to choose from
New World Sales
Apparel Boutiques think of it as “down marketing”
Japanese distributors Advertising & Promotion Problems Lack marketing muscle, under-financed
Larger apparel retailers required big planned promotional change
MAGIC trade show Problems With Competition: Bargain-basement pricing
Contemporary brands
Department stores
Unlicensed vendors Alternative Stay in the NYC Gift Market Attempt urban-chic lifestyle market roposal Stay in the NYC Gift Market Too many requirements by larger apparel stores
Gift market has brought more sales and revenue More effort can be placed into advertising and promotion, as well as unlicensed vendors
Celebrity endorsements and placements Achieve "lifestyle" line status while remaining in gift shops and online Apparel Gift % of Retailers 2004 2005 2006 2007 2008 % of Retailers 2004 2005 2006 2007 2008 Retained 40% 50% 29% 29% Retained 58% 75% 80% 67% Difficulty retaining previous apparel market clients 2008 Gift market sales were approximately 5 times that of apparel market sales Trying out new avenues and markets have given Lynne experience, and a good knowledge base
Sticking with the NYC gift market is in the best interest of NYCSL Not renew licensing agreement with MTA and cease production Brand image
Brand personality
Repeat retail buyers in the gift/tourist market
Gift/Accessories sold very well
Reliable Vendors
Online sales
Great impulse buy Strengths Life style brand
Higher prices
Brand name
International license
Products price
Repeat buyers in the retail apparel industry
Companies looked for less expensive items or better brands for their stores Weaknesses Open her own store
She can advertise or have endorsements
One retail store
Focus on gifts and accessories
Life style brand
Specific target market Opportunities Competitors
Brand is not well known
Crowded industry, extremely competitive
Price of goods
Marketing exposure
Product lines to choose Threats Environment NYCSL Proposal
Full transcript