Peer evaluation of project for 3 girls every one did a good job the names on beginning
Strategic Marketing Plan UGG Slippers- Inside & Out Nicole Chuchro, Shobha Ajodhi, Uliana Batih Central Connecticut State University- School of Business Marketing 531-01 Dr. Kuan P. Chiang December 4, 2022 I. Executive Summary In this market strategy plan we discuss the benefits of our proposed product “UGG Slippers- In & Out” and how it would benefit the success of the UGG company as a whole. The situation analysis is broken down into three key environments: internal, external, and customer, revealing how each aspect is impacting UGG. In addition, a SWOT analysis is performed to highlight the strengths and opportunities as well as any weaknesses and threats such as accessibility at stores and economic stability. The threats and weaknesses are tackled by developing a competitive advantage through building on its reputation of quality and comfort in order to bring attention to the new product that offers greater features. The marketing goal is to seek customer satisfaction and encourage interest in the new multi-function sole for all shoes sold by UGG. The product will be marketed through highlighting product differentiation as well as segmentation to reach as many new consumers as possible. Some findings in market implementation are that customer reviews can be falsified however with the reputation UGG currently has; the problem is minor. The formal and information controls are broken down in detail to prepare for the market implementation and timeline for launching the new product which will include marketing audits for the firm. II. Situation Analysis A. The Internal Environment UGG current marketing goals and objectives revolve around the phrase “it speaks for itself”. The company does not market heavily to the public, instead uses real customer reviews and word of mouth to thrive in the market. The goals are achieved by collaborating with known celebrities and allowing them to market for UGG. A potential buyer will believe the customer’s 1 words, as they have no gain from honest reviews, over a marketing team whose main objective is to sell the product no matter what. The firm’s current performance is rising from that of previous years. In 2021, Decker reported UGG net sales at 1,717,082 (Decker Report 2021). Decker currently owns UGG which has benefited the company tremendously as reported that its fourth-quarter earnings more than doubled to $63 million, or $2.51 a share, from $1.18 a year ago (Owens 2022). The performance as a whole is improving the owner. Introducing the bottom sole replacements will be a benefit to its market share as well through product diversification. UGG is known for its sheep-lined boots which are claimed to be a by-product of the meat industry as they do not raise their own animals to kill. Animal welfare is a key concept UGG focuses on in order to maintain relations with their consumers as well as suppliers. In addition, in terms of the sole replacements, we will use environmental-friendly plastic alternatives as well as thermoplastic rubber soles with high density ethylene vinyl acetate (EVA) which is the lightest of all hard soles that UGG currently uses on their shoes. Decker as a whole company had long-term strategies in place before the pandemic to ensure their record-breaking success that included diversifying the UGG brand’s product offering, prioritizing ecommerce to acquire and retain consumers online and, executing distribution strategies unique to each of our brands that optimize brand health and sustainable growth (Powers 2022). The fact that Decker was able to conquer the pandemic and maintain stability was proof of their well-planning and spirits. The firm’s structure is supportive of the current marketing strategy because it has ensured a stable outcome with thriving financials. 2 B. The Customer Environment The current customers of UGG vary with respect to demographics and geographic location. In August 2022, the United States was the top country with traffic to ugg.com holding 66.71% of their total visits, and the United Kingdom fell second with 9.39%. The demographics is reported to be 30.5% male and 69.5% female with the age groups highest consumers ranging between the ages of 18 and 34 years old (SimilarWeb 2022). The age group of the traffic to the website does not include who actually wears the shoe or uses UGG’s products, simply those that take on the financial responsibility of purchasing. UGG used to have a reputation as mainstream but rebranded itself to include more trendy and stylish footwear that was inclusive of men and children, all while maintaining comfort. Including the replaceable bottom soles as an option for each shoe will allow the customer demographics to increase as other individuals will benefit. The potential clientele will be inclusive of demographics to consumers between the ages of 45 and 65+ years old as they will enjoy wearing their indoor slippers outside by simply replacing the bottom sole. UGG shoes are focused on the customer’s needs in providing comfort, quality, and warmth to one’s feet in cold weather and conditions. The basic look of the shoe allows for dressing up and dressing down any look while staying comfortable. UGG shoes are purchased consistently as there are a variety of styles, however the quality of their shoes is so high it is expected to have a life of 5-25 years. The majority of UGG shoes are purchased online; however, they have partnered with retailers’ shoes and large department stores as well as Urban Outfitters, Journey’s etc. to provide the traditional in-person shopping experience as well. In addition, the majority of UGG products are purchased around the holidays because with any high quality comes high pricing. UGGs are known for their longevity in life therefore the appeal for 3 their product remains since they became popular in the early 2000s. The high cost to consumers is what could often discourage purchases since there are competitors that offer cheaper alternatives, but UGG has countered that by creating their own line of cheaper boots called Koolaburra. C. The External Environment UGG’s major competitors are Bearpaw, Mozimo Ltd., and Rocket Dog. UGG was founded in 1978 and renowned for its iconic Classic boot. The reported revenue for UGG was reported as 11 million USD whereas its competitors stood at 19 million USD for Bearpaw, 6 million USD for Mozimo, and 8 million USD for Rocket Dog (ZoomInfo 2022). The target market is very similar in all companies with respect to purchasers as well as users. In addition, the products provided (specifically the warm lined classic boots) are similar in look but are cheaper than UGG. The only competitive advantage is the price that these firms have compared to UGG, $30-$70 per pair whereas UGG is $120 plus per pair of shoes. UGG tackles this competitive “advantage” by being inclusive with their brand KoolaBurra, offering the lower to middle class their comfort and warmth as well. Including the replaceable soles will allow UGG to stand out against their competition in providing exclusive sole replacements will set them aside on another level, besides quality, adding to the longevity of life. The other external factor that has been dictating UGG success is the COVID-19 pandemic, directly linked to economic stability. The world and United States specifically in this case, are working to bounce back from the repercussions. The economic conditions are directly related to customers’ ability to purchase luxury products at the price UGG provides. Including another benefit adds reason to justifying the purchase of UGG shoes with replaceable soles. The price of these shoes would be for one with two purposes (indoors/outdoors and quality) instead 4 of buying slippers and then shoes as well. Furthermore, the trend behind the name brand UGG was held to a higher social tier and the same concept applies now as they are making a comeback. The consumer would act as personal marketing for UGG and our replaceable soles, putting them as convenient and fashionable. III. SWOT Analysis SWOT Matrix Strengths: ● Fashionable/Trendy ● Variety of Style ● Inclusive of Gender Opportunities: ● Style of Shoes ● Multi-Purpose Functionality ● Product Diversification Weaknesses: ● Price of Product ● Sizing ● Accessibility at Stores Threats: ● Competitors ● Economic Stability ● New Trends A. Strengths UGG has many strengths that have helped the brand to grow and continue to be a consumer favorite over decades. The products range from boots to slippers that offer a comfortable but fashionable look for a wide-ranging demographic. As the brand has grown the products have become more in line with current trends and appeal to a wider base. As mentioned previously UGG is seeing a resurgence in popularity with teens and young adults with many seeking the shoes for style and comfort. Most recently UGG has seen success with the range of slippers offered as they are easier to wear than the boots and offer a different style. The slippers have been popular with men and women showing how strong the UGG brand is across demographics. This will help with the launch of the slipper with replaceable soles as there is already a strong base that is a fan of the slippers. B. Weaknesses 5 Though UGG has seen a growth in sales over the last year the high price of the product deters customers before they really know about the product. With other competitors in the market selling similar products for less such as Bearpaw and Rocket Dog, UGG has to find ways to justify its pricing. With economic issues on the rise many are looking to save and may not see a $120 pair of boots as a necessary purchase. Another weakness for UGG is the lack of availability of their products in stores so that consumers can physically interact with the product. This can be helpful as it gives potential buyers a direct feel and knowledge of the product so they can see the quality of it. By experiencing the feel and comfort of the show they may be more inclined to purchase even at a higher price. UGG should identify ways to be in more retail stores to better reach consumers. C. Opportunities Adding this new product to the extensive and reputable catalog of UGG products can help to start a new trend in multi-purpose shoes. The replaceable soles allow for the slippers to be used more often and in different environments reducing the number of shoes needed. This is also an opportunity to expand on the company’s goals of social responsibility and sustainability as they can deliver a product that is quality and will last over time. This style of shoe is not yet popular and gives UGG the opportunity to continue to set trends and styles with their already dedicated consumer base. D. Threats The market is always shifting and trends constantly changing, UGG has to move fast to meet the needs of consumers at the time of demand. With many competitors that can produce their own version of the products quickly and offer for lower prices UGG has to position itself appropriately to attract consumers. Trends are also quick to change and the comfortable but chic 6 style is popular now, a trend that would include these multi-purpose slippers. Consumers are constantly looking for the next trending product and reaching the market at the right time is imperative. E. Developing Competitive Advantages As a major brand UGG has the ability to bring in a new kind of product to the market as they have already formed a trusted consumer base. Internally they have the knowledge and resources to expand into this new territory and market it as needed. Strategically the brand can build on its reputation of quality and comfort to bring attention to a new product that offers these features. They can also use social media to bolster their campaign as the trending products are quick to sell out and the instant content allows for more word-of-mouth advertising. F. Developing a Strategic Focus Utilizing UGGs strengths of an established reputation and consumer along with trending styles the brand can implement a strategy to sell this inventive product. Many consumers may ask why they need this product, and a strategic marketing strategy would be to highlight the multi-use functions, the inventive concept and the ability to have multiple styles with one product. IV. Marketing Goals and Objectives Marketing goals for UGG in this new venture would be to seek customer satisfaction with the new product. Furthermore, to create an interest in this new multi-function shoe style so that it may be further developed overtime. The objectives for UGG would be to see positive sales growth following the release of the product and to also see increased traffic to online retailers. Interest in the product will give an indication to if the concept should be developed further to other styles. Other objectives for UGG would be to see an increase in user engagement with their 7 social media platforms and tags. This is the main source of advertising to the demographics of UGG consumers, see interactions and positive reviews would indicate happy consumers. The most important objective is to see positive feedback on the new product to see if it aligns with UGGs mission statement of delivering the feeling of quality and comfort. V. Marketing Strategy To