Environmental
Analysis
Presented to:
Simon Cope
By
Isabel Cuartas
11117182
Kate Doyle
Catherine Howell
08226490
Devon Ingl...
Table of Contents
TABLE OF CONTENTS..........................................................................................
List of Graphs
Graph 1. Age Distribution of Females Living in the North Shore........................................... 3...
List of Tables
Table 1: Clothing Retail Sales in New Zealand ................................................................
1. Introduction
Victoria’s Secret is a strategic business unit of Lim-
ited Brands, which currently owns and operates six
...
2. Sociocultural Forces
1
TV Guide April 23-29, 2011. Sample was drawn from a typical weekday (Wednesday April 27). Only f...
This demographic analysis will focus on the popula-
tion trends which affect the Albany Mega Centre
market. Focus will be ...
The median income for the North Shore is
$29,100. New Zealand as a whole has a me-
dian income of $24,400 (Statistics New ...
Graph 3: Economic Growth North Shore
(Enterprise North Shore, 2011)
This economic growth is reflected in the retail sector...
Table1: Clothing Retail Sales in New Zealand
(New Zealand Retailers Association, 2010, p.25)
There is a positive correlati...
Victoria’s Secret employs technology to monitor
the fast-paced changes in the fashion industry.
Their ‘speed-to-market’ bu...
6.1. Employment Regulations
The Department of Labour (2011) outlines the min-
mum costs Victoria’s Secret will incur when ...
3
See Appendix 2 for more SWOT analysis which focuses on competitive advantages of Victoria’s Secret
• Fibre Content Label...
7.1. Bargaining Power of Suppliers
It is argued by Kotler and Keller (2009), that when
supplied products are a company’s g...
There are currently nine retailers4
in the Albany area
which can accommodate the underwear needs of
the approximately 47,5...
8. Conclusion
Through the application of a macro environmental
analysis, this report sought to determine the suit-
ability...
9. References
Acrossnz. (2008). New Zealand: The people. Retrieved from
http://www.acrossnz.com/nzInfo/culture_people.php....
Limited Brands. (2011a). Global presence: International FAQ. Retrieved from
http://www.limitedbrands.com/our_company/globa...
Statistics New Zealand. (2006c). Education North Shore. Retrieved from
http://www.stats.govt.nz/Census/2006CensusHomePage/...
Store Name Genre
Animates Pet Care
Baby Factory Other
Bed Bath N Beyond Houseware
Bivouac Outdoor Leisure
Briscoes Housewa...
Appendix 2
SWOT
Strengths
•	 stores provide a unique shopping experience
•	 offers wide range of products
•	 powerful bran...
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Victoria

  1. 1. Environmental Analysis Presented to: Simon Cope By Isabel Cuartas 11117182 Kate Doyle Catherine Howell 08226490 Devon Ingle Jessica Woods VICTORIA’S SECRET
  2. 2. Table of Contents TABLE OF CONTENTS...................................................................................................II LIST OF GRAPHS...........................................................................................................III LIST OF TABLES............................................................................................................IV 1. INTRODUCTION....................................................................................................1 2. Socioculturalforces..........................................................................................................2 3. Demographics .................................................................................................................3 3.1. Population for the North Shore ......................................................................................3 3.2. Income .............................................................................................................................4 3.3. Education..........................................................................................................................4 3.4. Ethnicity...........................................................................................................................4 4. Economic..........................................................................................................................4 4.1. Exchange Rates ..............................................................................................................4 4.2. Inflation..............................................................................................................................4 4.3. Economic Growth and Interest Rates .......................................................................... 4 5. Technology........................................................................................................................7 5.1. Transport Logistics......................................................................................................... 7 5.2. Victoria’s Secret Direct.................................................,,................................................ 7 5.3. Victoria’s Secret Inventory Management...................................................................... 7 5.4. Telecommunication ........................................................................................................7 6. Political and Legal Environment.................................................................................... 8 6.1. Employment Regulations............................................................................................... 8 6.2. Legal Regulations ...........................................................................................................8 7. Market and Industry .......................................................................................................9 7.1. Bargaining Power of Suppliers ....................................................................................10 7.2. Bargaining Power of Customers .................................................................................10 7.3. Threat of New Entrants ................................................................................................10 7.4. Threat of Substitutes ....................................................................................................10 7.5. Industry Competition ....................................................................................................11 8. CONCLUSION.............................................................................................................. 12 9. REFERENCES.....................................................................................................13 10. APENDICES........................................................................................................16 APPENDIX 1: ALBANY MEGA CENTRE RETAIL MIX.................................................16 APPENDIX 2: SWOT ANALYSIS...................................................................................17 II
  3. 3. List of Graphs Graph 1. Age Distribution of Females Living in the North Shore........................................... 3 Graph 2. Income for People Aged 15 Years and Over............................................................4 Graph 3. Economic Growth North Shore ................................................................................5 Graph 4. Retails Sales in New Zealand ...................................................................................5 III
  4. 4. List of Tables Table 1: Clothing Retail Sales in New Zealand ...........................................................................6 Table 2: Employment Regulations - Break Entitlements.............................................................8 IV
  5. 5. 1. Introduction Victoria’s Secret is a strategic business unit of Lim- ited Brands, which currently owns and operates six other companies dealing in the apparel and beauty cosmetics sector. The company includes a diverse product mix which including: underwear, sleepwear, seasonal wear, accessories, swimwear and beauty cosmetics (Workman, 1996). Victoria’s Secret stores, which specialise in lingerie (Workman, 1996), range from 600 square feet to 1,000 square feet and are owned under a whole- sale agreement carrying the Victoria’s Secret brand (Limited Brands, 2011a). These stores are usually opened in tourist destinations, such as shopping centres, airports and major cities (Limited Brands, 2011a). The main corporate strategy of Victoria’s Secret fo- cuses on marketing efforts ensuring brand recogni- tion through several tactics such as: fashion shows, celebrity endorsements, catalogues and advertis- ing. Currently, Victoria’s Secret sells to customers in over 80 countries through their direct website Limited Brands, 2011a). The Albany Mega Centre would suit Victoria’s Se- cret large tenanting requirements as it is a bulk retail facility in a sought-out location. Currently, the Al- bany Mega Centre facilitates 26 retail tenancies, the principal tenants being: The Warehouse, Farmers, Cotton On, Briscoes, Rebel Sport and North Beach (Argosy Property Trust, n.d.). It has readily available parking and is situated central to the Albany West- field Mall, Massey University, the Albany Stadium and a motorway off-ramp. This environmental analysis report will focus on the feasibility of opening a new Victoria’s Secret store in the Albany Mega Centre. Sociocultural, demo- graphic, economic, technologic and political fac- tors will be closely examined to assess the market attractiveness and competitive advantage of a new Victoria’s Secret store in Albany. 1
  6. 6. 2. Sociocultural Forces 1 TV Guide April 23-29, 2011. Sample was drawn from a typical weekday (Wednesday April 27). Only free-to-air channels (TV1, TV2, TV3, Four, Prime, and Maori) were used in the sampling frame. Thirty-nine of Seventy-nine programs were American. Cultural and social influences are considered the most fundamental determinants of an individual’s wants and needs (Kotler & Keller, 2009), and are therefore important variables to consider when establishing a foreign company within New Zealand. Today’s New Zealand is a multicultural society, comprised largely of highly educated and sophisticated individuals who enjoy self-reliant qualities and have a genius for innovation (Acrossnz, 2008). In large, the ‘Kiwi’ female enjoys the same economic in- dependence as her American and British counterparts (Statistics New Zealand, 2005). However, measuring and comparing the New Zealand sociocultural identity with that of America’s can be a difficult process. The Ministry of Social Development (2010) argues that “television is the dominant cultural medium for most New Zealanders” (p.1), therefore one sure way to compare both countries is to measure the amount of local programming. In America, 90 per cent of television programs are locally made, compared to only 24 per cent in New Zealand (NZ on Air, 2009). Interestingly, using a sample from The TV Guide1 it was discovered that approximately half the content was American. This suggests that New Zealanders have a high exposure rate to the American culture. Also apparent within both America and New Zealand’s cultural structure is how nor- mative femininity is based on the same physical attributes. This is most obvious when comparing New Zealand lingerie adverts to those of Victoria’s Secret and its ‘angels’. Though oceans apart, both nations use women of similar ethnicities, age, and hair colour to advertise underwear, with the ideal female being large-breasted, tall and skinny (Morrison, 2007). Thus, the visual representations of ‘stereotypical’ women used throughout Victoria Secret’s campaigns should have the same effect on New Zealand women as it has had on American women. There are, however, some blatant differences between the sociocultural environments of the two countries. One of which is the difference in language which may have advertising repercussions- where in America women’s underwear are largely referred as ‘panties’, in New Zealand the term ‘knickers’ is more applicable (NDP Fashion- world, 2004). But this should not detract from the fact that more similarities between the countries’ social and cultural norms exist than differences and that New Zealand’s sociocultural environment- in terms of lingerie, females, and fashions- is heavily influ- enced by the Americans. 2
  7. 7. This demographic analysis will focus on the popula- tion trends which affect the Albany Mega Centre market. Focus will be placed on the size, growth rate, population and age distribution within the North Shore region. Distinctive consideration will be given to factors which attain to the target market for Victoria’s Secret which is comprised of 15-44 year- old females2 . Albany is the shopping hub of the North Shore (Auckland Council, 2010), therefore the North Shore as a whole will be examined in this demographic analysis. In total, there are 47,556 females within the tar- geted age group (15-44) residing on the North Shore (Statistics New Zealand, 2006a). Because approximately 45 per cent of North Shore females fall within the 15-44 year-old target market this sug- gests an ideal location for a new Victoria’s Secret store. 3. Demographics 2 The target market age group is derived from personal experiences 3.1 Population for the North Shore The population for North Shore females in 2001 was 95,637, and in 2006 increased to 105,717 (Statistics New Zealand, 2006a). This is a 10.5 per cent increase within a five-year timeframe suggest- ing that the potential consumer base for Victoria’s Secret is increasing. (Statistics New Zealand, 2006a) Graph 1: Age Distribution of Females Living in the North Shore 3
  8. 8. The median income for the North Shore is $29,100. New Zealand as a whole has a me- dian income of $24,400 (Statistics New Zealand, 2006b). The implication of this is that North Shore is a higher socio-economic area and therefore, is more likely to have a higher purchasing power and more disposable income than the average Auck- land resident (Statistics New Zealand, 2006b). 3.3. Education The education levels within the North Shore region are high, with 47.1 per cent having gained a post-school qualification (New Zealand Statistics, 2006c). Only 13.8 per cent of the North Shore population who are over the age of 15 have not gained any formal qualification. Due to a strong positive correlation between education levels and income (Keller, 2010) this would imply that North Shore residents are within a higher-income bracket. Sixty seven and a half per cent of people in the North Shore belong to the European ethnic group, while 18.8 per cent belong to an Asian ethnic- ity. Aside from English, the next most common language spoken on the North Shore is Korean, which is spoken by 4.1 per cent of people. The North Shore is recognized as a culturally diverse location (Statistics New Zealand, 2006d). This means that although Victoria’s Secret’s business operations will be conducted in English, the com- pany will need to consider appealing to a wide variety of different cultures and customs. 4. Economic 4.1. Exchange Rates A strong New Zealand dollar increases the pur- chasing power for New Zealand importers (Re- serve Bank of New Zealand, n.d.). This means that American products can be purchased for less, benefiting the opening of a Victoria’s Secret store. Due to the majority of the products being manufactured in the United States, the exchange rate between the NZD and USD should be con- sidered as this will affect the profit margins. 4.2. Inflation Appreciation of the NZD will lead to a lower infla- tion rate (Reserve Bank of New Zealand, n.d.). This is basically because more imported goods are competing in the domestic market; therefore domestic goods will have to reduce their prices in order to keep their competitiveness. 4.3. Economic Growth and Interest Rates New Zealand is currently showing low interest rates (Reserve Bank of New Zealand, 2011). The lower the interest rate, the higher is the expendi- ture on retails items and commodities. Graph 2: Income for People Aged 15 Years and Over (Statistics New Zealand, 2006b) 3.2. Income 3.4. Ethnicity 4
  9. 9. Graph 3: Economic Growth North Shore (Enterprise North Shore, 2011) This economic growth is reflected in the retail sector (Enterprise North Shore, 2011) as demonstrated in the following graph which shows the value of retail sales for the period of April 2010 to November 2010. As shown in the graph below, the North Shore area presented a negative growth of 0.3 per cent for the month ending in April 2010. As for the months ending June 2010 and November 2010, the economy showed a positive growth with 0.2 per cent and 1.3 per cent respectively (Enterprise North Shore, 2011). According to Fallow (2011), the Auckland economy, “should be growing by between 3 and 3.5 per cent by the end of the year. Growth over the entire year could average around 2.5 per cent, compared with the 1.5 he expects for the country as a whole, which is more optimistic than the consensus 1.1 per cent”(para.5). Graph 4: Retails Sales in New Zealand (Enterprise North Shore, 2011) The graph shows a low value on retail sales when the economy presented a negative growth in April 2010. The economy is recovers towards the end of the year and the value on retail sales increases. 5
  10. 10. Table1: Clothing Retail Sales in New Zealand (New Zealand Retailers Association, 2010, p.25) There is a positive correlation between the ‘Economic Growth’ and the ‘Retail Sales’ graphs; as the economy of the country grows, the retail sector increases in sales. If this trend contin- ues, this will directly benefit the new Victoria’s Secret store as a recession free economy will give consumers more confidence (English, 2011). This is supported by Table1 ‘Clothing Retail Sales in New Zealand’ (see below), in which the performance of the clothing sector in comparison with the regular retail sales over the last six years is presented (New Zealand Retailers Association, 2010). The retail figures for the years 2008 and 2009 show a decrease in sales. The scenario for 2010 looks more positive with a 4.1 per cent increase. This positive scenario accompanied by positive economic growth will lead to the success of the new Victoria’s Secret store. Year ending March Total ‘Regular’ Retail Sales % Change Prior Year Total clothing /Soft Goods Retail % Change Prior Year $m % $m % 2010 41,332 2.6 2,662 4.1 2009 40,294 1.5 2,556 -1.2 2008 39,697 5.1 2,587 4.2 2007 37,769 6.1 2,482 2.9 2006 35,611 5.9 2,413 11.5 2005 33,616 6.7 2,165 8 6
  11. 11. Victoria’s Secret employs technology to monitor the fast-paced changes in the fashion industry. Their ‘speed-to-market’ business model focuses on shortening the time between generating a new product concept and product launch; an approach central to Victoria’s Secret’s trend setting in the industry (Kumar, 2005). This approach is supported by supplier technology which is “so remarkable that production is at unbelievable levels” (MAS Hold- ing, 2011, para.9). ‘Speed-to-market’ would be a challenge for Victoria’s Secret in New Zealand as transport takes longer than in America. 5.1. Transport Logistics As Victoria’s Secret uses over-seas factories, the means of transport is of key importance; both air- freight and ocean shipments are utilized. Victoria’s Secret has an internal logistics provider, Limited Logistics Service (LLS), who decide which method of transport to use (Kumar, 2005). Victoria’s Secret’s lingerie items are cost-effective to transport due to being small and lightweight, however, costs would escalate when transporting to New Zealand there- fore decreasing the market attractiveness of open- ing a Victoria’s Secret store. The use of infrequent but large cargo loads would be preferable. 5.2. Victoria’s Secret Direct Victoria’s Secret Direct, the online technology of virtual shopping and printed catalogues, is an advantage to Victoria’s Secret as it provides con- venient access to products at any time; a service not provided by all retail stores. New Zealand rivals, such as Cotton On and The Warehouse, do provide online shopping sites but are not concentrated to- wards the New Zealand market nor do they display all products; this is a potential opportunity for Vic- toria’s Secret to exploit as current customer prefer- ences and buying patterns are quickly identified. 5.3. Victoria’s Secret Inventory Management Because Victoria’s Secret is a multichannel retailer, including Victoria’s Secret Direct, Victoria’s Se- cret Stores and Victoria’s Secret Beauty, technol- ogy to communicate the needs of each channel is essential. Currently Victoria’s Secret stores use point-of-sale (POS) data to monitor inventory levels and anticipate stock needs to communicate to the distribution centre (Kumar, 2005). 5.4. Telecommunication Telecommunication with North Shore’s population would be effective as 77.4 per cent have access to the Internet and 82.9 per cent have access to cell phones (New Zealand Statistics, 2006e). Victoria’s Secret currently communicates product offerings to American and Canadian customers via facebook, twitter, email, iPad, iPhone, YouTube and mobile phone (Biro & Durbin, 2004). At very little cost, these strategies could be implemented to effectively reach the North Shore market. Although available to all members of this industry, the use of social networking sites and ‘apps’ have not yet been em- braced by Victoria’s Secret competitors and could be a source of competitive advantage. 5. Technology 7
  12. 12. 6.1. Employment Regulations The Department of Labour (2011) outlines the min- mum costs Victoria’s Secret will incur when employ- ing in New Zealand: • Victoria’s Secret must pay employees 16 years and over the minimum wage of (NZD) $13.00 per hour. Unless the employee is undertaking training or has not worked for more than 200 hours or three months. • Victoria’s Secret must provide employees with the following breaks: Table 2: Employment Regulations- Break Entitlements NOTE: For working over 8 hours, the break entitle- ment starts again. • Victoria’s Secret will be obligated to provide employees with the following holidays: - Four weeks wages paid holiday after twelve months (after employment period of one year). - After six months employees are entitled to five paid sick days every 12 months. - After six months employees are entitled to three days paid bereavement leave following the death of an immediate family member. - Employees are entitled to time-and-a-half pay and an alternative paid holiday after working a public holiday that is a normal working day for them. If it is not their normal working day they are entitled to time-and-a-half pay only. • If Victoria’s Secret does not comply with employ- ment laws, fines can be incurred of up to $20,000 for the company and up to $10,000 for individual employees. 6.2. Legal Regulations Within New Zealand, legislations will affect the op- erations of Victoria’s Secret: Under the Consumer Guarantees Act (1993) as cited in Hawes (2007) Victoria’s Secret is obli- gated to provide consumers with guarantees for the goods they sell. Victoria’s Secret has to ensure their products are of acceptable quality, fit for their intended purpose, safe, durable and have no minor defects. Under the Fair Trading Act (1986) as cited in Hawes (2007), Victoria’s Secret is obligated to disclose the following on any clothing items under the Consumer Information Standards: • Country of Origin (Clothing and Footwear Labe- ling) Regulations 1992- clothing has to be labeled with its country of origin in English, be permanent and easily seen. 6. Political & Legal Environment Time Period of work. Provide 10 minute paid break. Provide 30 minute unpaid break. Provide another 30 minute unpaid break. Less than two hours. Between two and four hours. Yes Between four and six hours. Yes Yes Between six and eight hours. Yes Yes Yes 8
  13. 13. 3 See Appendix 2 for more SWOT analysis which focuses on competitive advantages of Victoria’s Secret • Fibre Content Labeling Regulations 2000 – all textile goods must be labeled with their fibre content. • Care Labeling Regulations 2000 – labels on the clothing must describe how to cor- rectly care for the clothing with the use of words, phrases and symbols. When importing Victoria’s Secret products into New Zealand many costs are incurred: • A Goods and Services Tax (GST) of 15 per cent of the transactional value of the goods which is the price paid for the imported goods, converted into NZD by using the current exchange rate on the date of the import entry (New Zealand Cus- toms Service, 2011a, 2011b). • GST is paid on the freight and insurance costs of the goods (New Zealand Customs Service, 2011a). • An import transactional fee of NZD $25.30 is to be paid on every import entry plus a biosecurity risk screening levy of NZD $12.77 (New Zealand Customs Service, 2011a). • A tariff duty of 5 per cent of the transactional value is to be paid on the cosmetic imported goods (New Zealand Customs Service, 2011c). 7. Market and Industry The target market for Victoria’s Secret can be de- fined as contemporary women between the ages of 15 and 44. Although the brand originally sought to target only ‘white-collar’ females (Workman, 1996), a combination of its expanding product mix and intensive marketing tactics has expanded its target audience, incorporating both ‘tweens’ and ‘middle-aged’ females as customers. This strategic move has seen the brand experi- ence a sharp revenue rise in the month of April 2011, despite the economic downturn experi- enced in the America (The Associated Press, 2011). Coupled with data postulating that the average woman is continually replenishing her underwear drawer (NDP Fashionworld, 2004), it follows then that the market for these types of products has constant demand and a captive target audience. However, the success of Victoria’s Secret in America is not only attributed to the lucrative market of undergarments, but also to the power- ful brand name the company has sought to build and maintain. Further attesting the success of this company is research which has shown that Victoria’s Secret is the second most recognised brand amongst women in the world (NDP Fash- ionworld, 2004). Likewise, in the month of April 2011, Victoria’s Secret received more facebook ‘Likes’ than any other retailer (Eaton, 2011). It is expected that the market in New Zealand would follow along the same lines as America due to economic and sociocultural similarities. By analysing Porter’s Five Forces3 , the market here can be examined in further depth and compari- sons can be made with more confidence. 9
  14. 14. 7.1. Bargaining Power of Suppliers It is argued by Kotler and Keller (2009), that when supplied products are a company’s greatest as- set, the supplier will ultimately have some form of bargaining power. However, the nature of the apparel industry, which is flushed with manufacturers, as well as the power- ful name of Limited Brands, suggests that suppliers would have little to no bargaining power in the New Zealand market. 7.2. Bargaining Power of Customers The customer’s bargaining power largely stems from the availability of substitutes in the market for similar products (Porter, 2008). When referring to #4 Threat of Substitutes (see below) it is apparent that consumers would hold some bargaining power, but only in large numbers. Customers have a large amount of choice within easy walking distance and substituting products involves no switching costs. Consequently, cus- tomers will be less inclined to brand loyalty (Porter, 2008). 7.3. Threat of New Entrants The barriers to entry for Victoria’s Secret in the Albany Mega Centre are low as it has the necessary start-up capital, there is no one competitor who exerts control over the segment and there are no harsh legal regulations to meet (Porter, 2008). Therefore, new entrants could easily enter the linge- rie market, thus competing with Victoria’s Secret. 7.4. Threat of Substitutes There is little in the way of substitute products for underwear, unless a customer has an inclination to go without them. Consequently, Victoria’s Secret’s customers will have little propensity towards a sub- stitute product. Also, the Victoria’s Secret concept is completely new to the New Zealand business market so con- sumers could not substitute the shopping experi- ence with another retailer. 10
  15. 15. There are currently nine retailers4 in the Albany area which can accommodate the underwear needs of the approximately 47,556 females (aged 15-44) living on the North Shore (Statistics New Zealand, 2006a). Four of these retailers are tenants of the Albany Mega Centre5 (see Appendix 1 for entire Albany Mega Centre retailing mix). When these competing retailers are examined in more depth it is apparent that none meet all the needs of the typical Victoria’s Secret customer. The Warehouse, for example, is a general department store and its products are not perceived as ‘classy’ or ‘luxurious’. Cotton On, although brand recogni- tion is high and pricing is affordable, does not target the older female group. Alternatively, Ezibuy mainly targets older women and is not well known for its lingerie department, the same applies to Postie Plus. As for Westfield competitors, the biggest threat would likely be Bras N Things’, however, it does not stock the wider product mix found at Victoria’s Secret (such as accessories and beauty cosmet- ics). Farmers, Bendon, and Peter & Alexander are all upmarket and often times too expensive for the younger consumer. Therefore, though competition exists, none can accommodate all the criteria sought by the ‘typical’ Victoria’s Secret customer rendering little more than minor competition. 7.5. Industry Competition 4 Farmers, Kmart, Warehouse, Bendon, Bras N Things’, Peter Alexander, Ezibuy, CottonOn, Postie Plus 5 The Warehouse, CottonOn, Ezibuy, Postie Plus 11
  16. 16. 8. Conclusion Through the application of a macro environmental analysis, this report sought to determine the suit- ability of a new Victoria’s Secret store in the Albany Mega Centre by examining factors such as socio- cultural, demographic, economical, political/legal, technological and market/industry variables. It was discovered that the store would encounter difficulties whence entering the New Zealand mar- ket. The use of different terminology due to socio- cultural factors, and a multicultural diversity present within New Zealand, which differs from America, would have marketing implications. Also, high importation costs, fluctuating exchange rates, high transportation costs, and regimented legal regula- tions could also hinder the new store and have management implications. Similarly, because the barriers to entry are low, there is the ever present threat of new entrants entering the apparel sector. Economic conditions, consum- er perceptions of country-of-origin labelling, as well as attitudes towards America as a whole could also challenge the success of a Victoria’s Secret store here in Albany. However, the current market conditions existing within the Albany region identifies competitors’ which cannot offer the entire product range and shopping experience provided by Victoria’s Se- cret, meaning that the new store would enjoy high market share in a high growth market (as there are few substitutes available). And though the industry is one which is easy to enter, the powerful brand name of Victoria’s Secret would make it difficult for new entrants to steal its market share. Likewise, the analysis demonstrated the follow- ing favourable points: that more similarities exist between the nation’s sociocultural environments than differences, that the North Shore population is growing quickly whereby a large percentage is composed of Victoria’s Secret target market, that current economic conditions are favourable for the new store with predictions suggesting an upward trend for the months to come, that Victoria’s Secret effective use of telecommunications should help to minimise the exorbitant transportation costs whilst efficiently spreading brand recognition throughout the New Zealand market, and that the political conditions present within New Zealand pose no problem for the store’s success providing Victoria’s Secret complies with legislation and regulations. In conclusion, the difficulties a new Victoria’s Se- cret store would encounter when entering the New Zealand market do not negate the positives. When all points are considered it is concluded that open- ing a new Victoria’s Secret store in the Albany Mega Centre is not only feasible but possibly an extremely lucrative endeavour. 12
  17. 17. 9. References Acrossnz. (2008). New Zealand: The people. Retrieved from http://www.acrossnz.com/nzInfo/culture_people.php. The Associated Press. (2011). Victoria’s Secret parent brand sales figure up in March. Retrieved from http://www.businessweek.com/ap/financialnews/D9MEQGK81.htm. Argosy Property Trust. (n.d.). Retail: Albany Mega Centre. Retrieved from http://www.argosypropertytrust.co.nz/Property/Detail.aspx?id=162. Auckland Council. (2010). Albany. Retrieved from http://www.northshorecity.govt.nz/LeisureAndCulture/VisitingAndEntertainment/City Attractions/Pages/Albany.aspx. Biro, K., & Durbin, T. (2004). Victoria’s Secret. Retrieved from http://www.tuck.dartmouth.edu/cds-uploads/case-studies/pdf/6-0014.pdf. Department of Labour. (2011). Minimum employment rights and obligations. Retrieved from http://www.dol.govt.nz/er/minimumrights/MinimumEmploymentRights.pdf. Eaton, D. (2011). Victoria’s Secret dominates facebook popularity. Retrieved from http://www.bizjournals.com/columbus/blog/2011/04/victorias-secret-dominates- facebook.html. English, B. (2011). NZ dodges recession, 2011 optimism grows. The New Zealand Herald. Retrieved from http://www.nzherald.co.nz/economy/news/article.cfm?c_id=34&objectid=10714624. Enterprise North Shore.(2011). North Shore economic monitor. Retrieved from http://www.ens.org.nz/Economic+Monitor.html. Fallow, B. (2011). Economist tips good times for Auckland. The New Zealand Herald. Retrieved from http://www.nzherald.co.nz/economy/news/article.cfm?c_id=34&objectid=1072072 Hawes, C. (2007). Butterworth's introduction to commerical law (2nd ed.). Wellington: LexisNexis. Keller, K. I. (2010). How education policies improve income distribution: An empirical analysis of education stages and measures on income inequality. Journal of Developing Areas, 43(2),p. 51-77. Kotler, P., Keller, L.K. (2009). A framework for marketing management (4th ed.). New Jersey, USA: Pearson Prentice Hall. Kumar, S. (2005). Supply chain strategies in the apparel industry: The case of Victoria’s Secret. Retrieved from http://dspace.mit.edu/bitstream/handle/1721.1/33324/62314026.pdf?sequence=1. 13
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  19. 19. Statistics New Zealand. (2006c). Education North Shore. Retrieved from http://www.stats.govt.nz/Census/2006CensusHomePage/QuickStats/AboutAPlace/ SnapShot.aspx?type=ta&ParentID=1000002&tab=Education&id=2000005. Statistics New Zealand. (2006d). Ethnicity North Shore. Retrieved from http://www.stats.govt.nz/Census/2006CensusHomePage/QuickStats/AboutAPlace/ SnapShot.aspx?type=ta&ParentID=1000002&tab=Culturaldiversity&id=2000005. New Zealand Customs Service. (2011a). Duties and levies. Retrieved from http://www.customs.govt.nz/importers/Commercial+importers/Duties+and+levies.htm. New Zealand Customs Service. (2011b). Fact sheet 28 - Advice on importing goods into New Zealand. Retrieved from http://www.customs.govt.nz/NR/exeres/EB35AEF0-4F2E-46D1-9FED-309955E85D23, frameless.htm?NRMODE=Published. New Zealand Customs Service. (2011c). Valuation of imported goods. Retrieved from http://www.customs.govt.nz/importers/Commercial+importers/Valuation.htm. Workman, V. N. (1996). From Victorian to Victoria’s Secret: The foundations of modern erotic wear. Journal of Popular Culture (30)2, p.61-73. 15
  20. 20. Store Name Genre Animates Pet Care Baby Factory Other Bed Bath N Beyond Houseware Bivouac Outdoor Leisure Briscoes Houseware Burger King Other Care Pharmacy Other CottonOn Fashion Dick Smith Electronics Ezibuy Fashion Farmers Houseware Golf Leisure Hallensteins Fashion Jay Jays Fashion Katmandu Leisure Lighting Direct Houseware Noel Lemming Electronics North Beach Fashion Plastic Bin Houseware Postie Plus Fashion Rebel Sport Leisure Shantons Fashion The Warehouse General Warehouse Stationary Other Whitcoulls Other Appendix 1 16
  21. 21. Appendix 2 SWOT Strengths • stores provide a unique shopping experience • offers wide range of products • powerful brand name associations • expertise. The brand first started in America in 1970s and is one of the largest retailers of lingerie in America (Lingerie Uncovered, n.d.) • high quality products at affordable prices • intensive marketing strategies • offers online sales • discounted prices when buying in bulk Weaknesses • ethnocentrism • mainly target women • not known for its environmental friendli- ness Opportunities • The direct competition (The Body Shop, Peter Alexander and Cotton on) don’t offer the same range of products under one brand • Ability to take advantage of an established brand • Stepping stone to untapped Australasian market • high internet usage in New Zealand will allow Victoria’s Secret to have a presence nation- wide • currency fluctuations, ability to increase profit margins through currency shifts. Threats • Currency fluctuations, ability to increase profit margins through currency shifts. • Subject to public opinion of the United States. • Established competition in the Albany Area. • ethnocentrism • economic conditions; smaller dispos- able incomes 17

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