2 . When Converse outsourced production of its shoes to India. It entered into licensing arrangement. What are the benefits and risks of that action? Do you think it has helped or hurt the company? The brand?
Lost of one of the brand element will make it weak
Faith in consumer for the product will be diluted
Reduction in legal compliance will make company irresponsible
Cost was reduced
Scope for alternative cost quantity benefit raised
Product was made cheaper on removal of
“ Made in USA” tag.
Legal compliance will be reduced
Helped the company: It helped the company in cutting cost It lets the company to shift the burden of production It gave them space to think on further diversification Cutting cost will reduce price and increase revenue Hurt the company: It made the product brand weak which will reduce the cost at one hand and increase the vulnerability to its revenue on the other Helped the brand: No help Hurt the brand: It had hurt the brand by the loss of one of its element
Choosing the best brand elements to market the shoes.
Company developed brand elements and new products to increase the brand equity.
Company designed personalized marketing activities.
Company started leveraging its secondary associations to create brand equity.
Q. ANALYZE THE NIKE-ERA DIRECTION OF CONVERSE. (A) ASSESS THE BENEFITS AND RISKS OF THE FASHION AND PERFORMANCE STRATEGIES INDIVIDUALLY, AND OF THE COMBINED TWO-TIRED APPROACH. (B) WHAT TARGETING AND POSITIONING WOULD YOU RECOMMEND FOR THE CONVERSE BRAND IN THE FUTURE?
FASHION POSITIONING: THE BENEFITS TO POSITIONING CONVERSE AS A FASHION BRAND BRINGS WITH IT THE TREMENDOUS OPPURTUNITY TO PRODUCE LINE AND BRAND EXTENSION.
LINE EXTENSIONS INCLUDE ALL NEW VARIETIES OF “CHUCK TAYLOR ALL STARS” AND THESE LINE EXTENSIONS ALSO HAVE ALLOWED THE BRAND TO BRANCH OUT INTO NEW, UPSCALE OUTLETS.
PERFORMANCE POSITIONING: THE PERFORMANCE BASIS SHOULD BUILD ON CONVERSE TRADITION AS A COMFORTABLE, SUPPORTIVE SHOE FOR EVERY USE AND FOR PLAYING USE WHILE RECOGNIZING THAT IT’S NOT A VERY HIGH PERFORMANCE SHOE.
TARGETING : THE POTENTIAL TARGET WILL BE GEN-Y (ABOUT 70 MILLION IN NUMBERS)
HIGH DISPOSABLE INCOME, HIGH SELF-WORTH, COOL IMAGE MAKES THE GEN-Y MORE FAVOURABLE TARGET.
TARGETING: THIS APPROACH MIGHT WORK BEST WITH ADULTS OVER FOURTY. IT FITS WITH THE CURRENT PROMOTION OF GETTING BACK TO THE BASICS WITH YOUNGER FOLKS AS WELL AS OLDER FOLKS.