Introduction
David Jones Limited unveiled its strategic plan in order to deal with various structural changes within the retail sector as well as existing macro-economic conditions.
The company’s performance within various market segments as indicated on the annual report is largely dependent on their ability to assess the needs and preferences of targeted consumers. Such needs within the fashion industry can easily be met through market segmentation where the company is capable of attending to specific consumer needs (Keegan and Green, 2002).
Creative Strategy
In order to achieve EBIT of around 12%, David Jones requires changing its pricing strategy. In such a case penetration pricing method is appropriate since it works well in situations where an intensive distribution channel is utilized for the purposes of capturing target markets (Fill, 2005). In this case, David Jones should also consider the aspect of reducing expenses in the process of utilizing such channels.
One of the factors leading to the increased expenditure is the increased number of employees currently working at the company. This can be eliminated through the utilization of improved technology currently present within the market. Such case requires the art of direct marketing through internet, social sites, email and company’s website which would provide necessary assistance (Prendergast et al., 2010).
Additionally, trading on the loyalty of the customer base would be reinforced through the use of sales databases, customer information databases, inventory control databases and track product returns databases. These actionable databases as mentioned above would assist in the determination of potential customers which would easily facilitate purchase and delivery processes.
On the same note, a multi-channel marketing system is preferable for the David Jones case, since consumers within the fashion apparel industry apply the use of variety sources for purchasing preferred products.
Positioning strategy
According to the annual report, David Jones limited is on track for launching the online shopping site. Due to the nature of such venture, they should review theoretical framework of knowledge and skill development, internet-related marketing programmes common within the international market and the position of social sites in sales and marketing industry (Fill, 2005).
At the same time, relationship between effective marketing through Instagram and productivity is an essential factor for purposes of positioning the company within the global market (Fan and Miao, 2012). The company should incorporate similar processes as allowing the use of celebrities and third party endorsement figures in the process of reinforcing product brand images within the fashion industry (Wei and Lu, 2012).
Although the global economy has not yet recouped to the pre-crisis era, there are positive signs that the implementation of Instagram and other social sites involving training and skills enhancement of employees can create confidence in customers towards David Jones products resulting into profitable gains (Kotler and Keller, 2007).
There is a strong belief that the consumer market for the fashion apparel appeals to customers based on fashion and store brands, different ethnic backgrounds within the international market and the level of personalization. In some regions, purchase intentions are based on the value and lifestyle.
There is also the aspect of price sensitivity of brands which determines consumers’ attractions towards fashion brands. In addition, a purchase on the fashion apparel in one region is majorly influenced by the rate of consumption within other regions and is referred to as cross-border consumer influence.
Branding
Maintaining existing brand factors on products is crucial as it ensures that the company maintains a large loyal customer base. However, a brand can be reinforced in the process of accessing new market segments. Products having a strong attachment to celebrities attract positive attitude towards advertisement as well as the brand within the market.
According to Wei and Lu (2012), both attachment and the number of endorsement have great influence on the level of purchases done on a product. However, consumer purchase intentions are at times negatively impacted in the event that a celebrity endorses multiple brands at the same time, since celebrities are recognized as common features within the marketplace representing the image of consumer products as well as companies.
Pairing brands with celebrities enables the brand to gain consumer awareness since positive attributes attached to the celebrity are transferred onto the brand hence building the image of the product.
The nature of the celebrity used determines the level of advertisement recall rates hence improving communication with potential customers through valid linkages. Such communication links between celebrities, products and consumers assist in breaking cultural barriers within potential markets (Wei and Lu, 2012).
Threat of on-line communication
From the annual report there are many aspects surrounding on-line marketing and communication. However, e-WOM (Electronic Word of Mouth) as one of influential factors has been identified as affecting the purchase decision. In some instances customers find it difficult to trust e-WOM based on its anonymity since there are possibilities of passing fake information online.
David Jones can influence the credibility of their e-WOM marketing through securing information on authority of disseminator, features of the receiver and the nature of the website used.
That is because the quantity, the quality and the lengths of e-WOM influence consumers’ perceived value and risk in the process of making the final decision on purchases. It is important to consider that marketing effectiveness of e-WOM is affected by the small percentage of internet users who are satisfied by the nature of authenticity involved (Fan and Miao, 2012).
References
Fan, Y & Miao, Y 2012, ‘Effect of Electronic Word-Of-Mouth on Consumer Purchase Intention: the Perspective of Gender Differences,’ International Journal of Electronic Business Management, vol. 10, no. 3, pp. 175-181.
Fill, C 2005, Marketing Communications – Engagement, strategies and practice, Pearson Education Ltd, Edinburgh Gate
Keegan, M & Green, K 2002, Global marketing management, Prentice Hall, London
Kotler, P & Keller, K 2007, Marketing Management, Pearson, Upper Saddle River, New Jersey,
Prendergast, G, Ko, D & Siu Yin, V 2010, ‘Online word of mouth and consumer purchase intentions,’ International Journal Of Advertising, vol. 5, no. 29, pp 687-708
Wei, P & Lu, H 2012, ‘An examination of the celebrity endorsements and online customer reviews influence female consumers’ shopping behavior,’ Computers in Human Behavior, vol. 29, no 1, pp.193-201.