1. word brand suddenly emerged, but it has been

 

1.     Historical evolution of “brand”

According to Humph and Lindberg-Repo (2011),
it is not like that the word brand suddenly emerged, but it has been around for
more than hundreds of years. Driven from the Ancient Norse word “Brand”,
meaning “to burn”, the word “brand” was initially referred to as a burning
price of wood used as a torch. By 1500s, the term evolved to a “mark burned on
cattle” to signify ownership. Holt (2004) asserts that each ranch would have a
distinctive mark on their cattle to indicate their ownership. This was done to
identify animals in case they get lost, mixed, or stolen. With the emergence of
industrial revolution and mass production in 1820s, goods such as ale and wine
were produced in volumes and producers began to mark their crates to
distinguish their products from other competitors. Slowly and gradually, the
mark became a symbol of quality rather than ownership and this is when famous
brands such as Coca Cola, Unilever and P&G came to live (Moore and Reid,
2008).

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2.     Consumer involvement with brands

Consumer involvement refers to the
importance attached by a consumer to a brand. A common perception is that
brands are expensive because they signify quality, durability and timeliness.
Therefore, price is one of the factors that influence consumers’ involvement
because consumers are more involved when the product is expensive (Riley, 2012)
for e.g. car. Other factors that would affect the consumer involvement with the
brand include advertisement, previous experience with the brand, product
features, brand equity, differentiation and consumer requirement (Perreau,
2014). The figure below summarizes these factors;

 

Figure 1: Factors influencing consumers’
involvement with a brand

 

 

Source: Riley (2012)

 

3.     Advantages of effective branding

Murphy (2015) summarized
the benefits of having strong brand in the following points:

A strong brand helps a company to build
market reputation and valueA strong brand attracts potential
customersCreates competitive advantage for the
companyProvides sustainable business identityCommunicates organizational values to all stakeholdersDifferentiate the company from the crowd 

4.     Components of a brand

Every market analyst that evaluates brand
will have his own set of brand components demonstrating the value, promise,
knowledge and other key elements of a brand. This is true that every brand has
several different components and there are different ways to examine these
components but “brand profiling” is an effective strategy used to develop and
implement brand personality by identifying the brand’s key components and
elements. Brand profiling is a systematic process that clearly outlines what a
brand offers and what it means for its target market and audiences (Carter,
2015).

5.      Evolution of brand management

The emergence of globalization rapidly
evolved the social, economic and cultural environment. On one hand where it
affected businesses and their dealings, on the other, it also influenced the
way brands were managed. In the rapidly changing world, marketers and brand
leaders are tracking information on a continuous basis to incorporate into
their brand management models. Local cultural trends and consumer lifestyle are
some of the factors that are monitored by brand leaders to position their
brands according to the changing needs and requirement of the consumers
(Stanat, 2017). These brands are found to have a strong emphasis on consumer
purchasing behaviour. One of the impacts of socio cultural factors on brand
management is the introduction of “Coke Lite” in Latin America by Coca Cola.
The Company found that the word “diet” has negative meanings in the Latin
American culture and so the company re-designed its “Coke diet” to “Coke Lite”
(Makgonsa and Sangodoyin, 2017).

 

Section 2

 

1.     Size and growth of the jean
industry

According to an industry analysis
report by Global Industry Analysts Inc. (2017), the global jean industry is
currently valued at US$60 billion and is expected to increase to US$72.8billion
by 2022. The report sheds light on factors such as growing urban population,
increase in the number of white collar employees and growing working women on
the growth of the industry. Figure 2 below shows that the industry has grown by
a CAGR of 30% from 2006 to 2011;

 

Figure 2: Growth in the global denim
jeans market size

Source: Global
Industry Analysts (2017)

The report also shows that global market share with respect to countries
and it is found that North America is the largest consumer of denim jeans,
followed by Western Europe, Japan and Korea. Premium jeans have grown to become
one of the fastest growing market segments. With growth in demand and other
factors, companies offering premium jeans are targeting developing countries
such as India, China, and others by opening new stores as to improve their
sales and profits.

The figure 3 below depicts the current trend in the global jeans
industry as it shows that recently there has been a drop in the global sales of
denim jeans as yoga pants are gaining popularity. If the current trend
continues then it is expected that denim jeans will struggle to increase sales
volume in the coming years, with CAGR of 8% until 2019. 

Figure 3:

Source: Lutz (2015)

 

2.     Industry key players

Talking about denim that Levi’s continues
to be the leader in the denim jean industry, holding the highest market share
in terms of sales (Kaplan, 2014); however, the inability of the company to
adapt to changing consumer needs cost them to lose sales volume and margins in
the recent financial years. The company lost its position in the Fortune 500 in
2012 and experienced decline in sales volume. In terms of online sales, Gap
leads the jean industry (as of 2015);

 

 

 

Figure 4: Online sales (as of 2015)

 

Source: Lutz (2015)

 

The figure above shows that more than 16%
of the revenue came from online sales for Gap whereas the percentage was
slightly lower for Levi’s. Notably, there are numerous companies offering jeans
which are mainly because of lower barriers to enter and exit. Due to rapidly
evolving fashion, taste and culture, there is no particular brand that people
look to but brands such as Abercrombie and Fitch continue to offer “jeans that
offers a badge of individuality (The Irish Times, 2008).

 

The distribution of these brands among
male and female are moreover the same, but females are more likely to buy jeans
and wear them to office. Figure 5 below shows the percentage of women compared
to men, and interestingly, the result shows that 53% of global denim
segmentation comprises of women. The analysis also shows that most of the
buyers prefer “standard” jeans while only 19% prefer premium jeans, 11% prefer
luxury jeans and 7% prefer to buy value.

Source:
Smith (2014)

 

3.    
Actions
takes to keep their key position

Levi’s can be a case study of a company
that once shaped the jean industry but due to its inability to adapt to
changing consumer needs and preferences lost its market share to competitors
and therefore the company is keen at gaining back its position as a global
fashionable brand. Levi’s implemented different strategies such as
reintroducing “one size fits all” strategy to boost sales and rolling out new
marketing campaigns to improve visibility of the brand.

 

Other brands have undertaken notable
strategies to improve their market share and revenues. For example, Miss Sixty
and Diesel are “quick to respond” to changing needs and taste therefore these
companies keep introducing new designs and fit for their target market. Zara
and Gap vertically integrated their stores to improve their product offerings
(The Irish Times, 2008). This allows Zara to reduce their turnaround time and
reduce “made to market” time. 

 

4.    
Segmentation
strategy

The segmentation strategy used within jean
industry is “psychographic segmentation” which is dividing the market into
different segments based on different traits, values, interests, lifestyles and
personality. This type of segmentation allows companies to design jeans
according to the taste and preference of their target segment (Smith, 2014). As
shown in the table 1 below, Levi’s target market segment comprising of
consumers aging between 13 to 30 years and thus the company designs jean
according to the customer needs of this segment which is “comfort, style and
trendy”.

 

Table 1: Market segments targeted by
different industry players

 

 

Source:
Kaplan (2014)

 

The above table shows that nearly all the
brand target market segment between 15-25 years because this segment is
considered as “very effective”. It usually comprises of students or employees
that wear jeans to school, university or at work. Therefore, companies try to
target this market segment and position their respective brands as “trendy,
comfortable and stylish” (Kaplan, 2014).

 

Section 3

 

1.     Issues faced by Worker Jeans

This section evaluates the issues
identified in the given case of Worker Jeans. There are number of issues
highlighted in the case study however to set the tone right, it seems that
Worker Jeans have everything wrong now. The company is experiencing decline in
brand equity where the “once great brand” is no longer having the same brand
equity and image. The reasons outlined in the case are the inability of the
company to adapt to changing consumer needs and demands. Furthermore, there is
a serious problem related to employee branding and organizational culture as no
one wants to live the brand. The case facts seem to provide that the company
has no idea to whom they are marketing the product, who are the buyers and the
target audience? Finally, the efforts on reducing costs adversely affected the
company as the store image remains the same while quality deteriorated over
time.

 

In the early 90s, the Worker Jeans was a
great brand offering retro and grunge feel as the trousers were torn and
grubby-looking with a British Flag, placing the brand in the “must have
category”. Originally focused at Britannia Generation, the company didn’t
evolve over time, neither in terms of advertisement innovation nor product innovation.
Like Levi’s, Worker Jeans stick to its retro and grunge look although
consumer needs and requirements changed over time. As mentioned in Section 1,
consumer taste and preferences changes rapidly with response to changes in
factors such as economic, social, technological and environmental. Companies
that are “slow to react”, such as Worker Jean, will eventually experience a
negative impact on their brand image and equity.

 

The case facts provide that the store
image was the same as it was in the nineties indicating that the company
decided to stock to the basics. Sharma (2017) conducted a study on the
importance of store image on brand equity for sportswear industry and found
that store image is one of the important factors that influence the purchasing
decisions of consumers.

 

 Other than store image, the attitude of
sales people is also an important factor that influences the
decisions-making process of the consumers (Soni, 2017). As mentioned by Holt
(2004), brands are not merely logos, but it reflects an irresistible
personality that attracts the attention of the consumer. People buy brands
because they have successfully made an emotional connection which is
particularly important and therefore they trust the brand. Based on this analysis,
it seems that the worker at Worker Jeans failed to create an exceptional
customer experience. The store assistant himself could not provide a positive
remark on their brand which is likely to affect the perception of buyers
present at the store. Thus, issues related to employees’ behaviour and
organizational values are serious if they negatively affect the brand image and
equity.

 

One more issue identified in the case is
that inability of the brand leaders to identify the market segment and position
the brand accordingly. The company offers rugged and grunge style jeans which
are mainly preferred by 16 to 20 years of age group comprising youngsters and
even adult. But, the design seems to follow the same pattern as that of the 90s
which is no longer considered as “trendy”. According to Stanat (2017), market
segmentation allows companies to create a strong message that can attract
target audience. But, in case of Worker Jeans, the company is unable to
identify the target market thus the marketing strategies are deemed to be
“unsuccessful”.

 

Brand is a guarantor of quality meaning
that if consumers prefer that a product offers high quality then it strengthens
its brand image (Taylor, 2010). Consequently, poor quality can weaken
brand image which also translates into poor sales and declining margins. The
case factors indicate that due to sourcing cheap raw materials, the company
eventually deteriorated its quality. Since, brands are expensive therefore the
customer involvement is relatively high, as mentioned in the Section 1 of this
report. The Worker Jeans offers expensive jeans compared to other brands, but
the quality is not as per customer’s expectation (referring to the case of
David). Furthermore, a previous experience is likely to influence their future
decisions therefore it is necessary to consider these issued and incorporate in
brand management.

 

2.     Recommendations

The
above analysis highlights the following issues in the given case study:

Inability to adapt to changing customer
needs and requirementsInability to evolve brand image over time
(store format and designs)Poor employee branding and organizational
cultureDeteriorating qualityUncertain economic conditionsPoor location (i.e. London)

 

These factors adversely affected the brand
image and brand equity of Worker Jeans, thus following recommendations is made
to the company to improve its brand image:

 

It is recommended to gather information,
through customer survey or market research, related to changing social,
environmental, economic and cultural patterns. As mentioned in Section 1 that
social and cultural factors changed due to globalization and changing business
environment therefore this information will help the company to understand the
changing patterns and position the brand accordingly. Rather than implementing the same
marketing strategy, it is recommended to undertake “brand profiling” which is a
systematic process to implement and establish brand personality and character.
The process will allow Jane to understand what consumer wants and what the
brand must offer. The outcome can be incorporated in brand management
strategies.  The company must put efforts to establish
long-term relationships with their customers as it improves brand image and
loyalty. Therefore, it is necessary that the management should interact with
customers at store. Assisting customers in their shopping experiences will help
management to understand the needs and requirements of the customers and
incorporate the same in the form of change in store format, designs and
employee behaviour.  For a brand to develop and prosper, it is
important the internal stakeholders such as employees, managers and owners
should believe on the brand. Therefore, it is important to interact with people
within the company and take feedback on areas that need improvement.  Research shows that North America is one
of the largest consumers of jeans therefore the company can think of expanding
the existing product to a new market (Ansoff Matrix) as it will improve both
margins and sales volume.