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Team t fiddit 083012_v5


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  • 1. Number of contacts today: 19 Total: 66FidditCustomized essentials package for professional menAugust 31, 2012 Yvonne Sissi Qiu Chris Carril Bryan Kim & Shirts & plus.. Ameyaw 1
  • 2. Learning and Pivoting Day 1 Day 2 Day 3 Day 4 Day 5 Customer Busy early- Busy early- Cost-conscious Cost-conscious Busy early-mid mid career mid career early-mid early-mid career men in Segment men men career men in career men in select select select industries Students Students industries industries Students Students Women? Value Prop Convenience Convenience Price Price Convenience Channel Mobile truck Mobile truck Pop-up stores Mobile app Mobile app Pop-up Pop-up In-office service Web Web stores stores Key Hypothesis: Men are Cost Men actually Bundling of key Busy men actually more structure don’t mind essentials for findings would want price research – some trouble busy from measurement sensitive than not as easy Women professionals getting out service come they think to compete may be segment may to them on price valuable of building be viable 2
  • 3. Day 1: Reassessment of value proposition and customer segment • What does our customer truly care about? convenience or price?  The answer is likely both with implicit range around “appropriate price point”. Continued customer discovery. • Are students, in addition to early-mid career men, also a segment we should target?  Targeting students seem to be an attractive starting point with some initially positive feedback. Continued customer discovery. Now what? • Research the competitive space • Find out the cost structure and players/steps involved in the shirt making process 3
  • 4. Day 2: Studying up on the market, process, and cost structure • Is our customer segment defined?  Students included to be part of our target segment • How much does it exactly cost and is there a way for us to cut cost further?  We found out the cost structure and the players involved. Seems like there is a room to cut middleman, but need further research. • What do our competitors do and what can we do better?  We gathered data on main competitors, including a detailed pricing survey and measurement techniques. Now what? • Define Fiddit’s differentiating factor • Research whether we can make the cost structure more favorable • Hypothesize, brainstorm and validate our potential channel strategy 4
  • 5. Day 3: Thoughts on additional customer segment and channel • Is customized women shirt a viable market for us?  Could be at late 20s to early 30s age bracket; potentially higher margin segment Convenience not a priority, while bespoke measurement and quality were. • What are students’ needs/concerns in terms of shirts purchasing?  $$: Student discount/ rewards (StudentUniverse) • What is the most appropriate channel to get customers?  Given our current target customer’s shopping behavior, mobile may have an advantage over web • Is there a more effective way to reach the customers?  We could structure a bundling of different products with a pre-determined ordering schedule (ala Proactiv) Now what? • Continue to refine customer segment by interviewing more professional women • Discover what is the price tolerence for students • Test whether customers are more receptive to mobile vs. web • Tease out whether customers would prefer/need a bundling of products that ships periodically 5
  • 6. Day 3: Deeper dive on cost structureTraditional outsource model for a shirt Wholesale Mills Agent Tailor shop Distributors • Cost: [TBD] • Fabric • Commission on • Responsible for the entire sale customer service, Cost: $25 (15%) initial contact with • Roles: Quality customer, Manufacturer control and measurement, shipping final alteration • Tailoring • Shipping Cost: $10 Cost: $5 Hong Kong NYC 6
  • 7. Day 3: Competitive Landscape High Retail Presence Mid Travelling tailor NY Tailor High End Tailor Low FIDDIT …and multiple smaller players $5 $8 $110 $140 0 0 + Price Point 7
  • 8. Day 4: Customer archetype Meet Bill Profile of Bill • Male • 28 years old • Works at a law firm from 9 am to 9 pm • Annual income of $125K • Has a taste for customized shirts • Buys 12 shirts, 10 undershirts and 10 socks a year • Has an iphone & a blackberry • No time! 8
  • 9. Day 4: A recurring revenue model 1 2 Customer gets We give the measured and customer a heads- chooses their up – they may packages for the delay/cancel their year and next order customer pays 7 2 Days Repeat Step 2… 21 Months Profit! Days Customer is charged Customer 14 receives their Days package Customer receives their package 9
  • 10. Day 1 # of customers: 13• Suppliers • Garment • Convenience • Highly personalized production and (in lead • Early to mid-• Manufacturers new client distribution time, location, onboarding career men• Capital processes • Innovative/targ etc) • More automated • Students going providers eted marketing (online) client into internships• Potential • Accessibility retention campaign strategic • Highly processes affiliates customization • Physical • Pop-up assets stores! • Intellectual • Mobile trucks! (i.e., brand • Internet down the road) • Dry cleaners • Fixed costs: salaries and rent • Retail (for buildings and potential • Potential fees from partners(?) equipment) • Variable costs: input costs as per made-to-order, costs of pop- up stores 10
  • 11. Day 2 # of customers: 17 • Suppliers • Garment • Convenience • Highly • Early to mid- personalized career • Manufacturers production and (in lead new client distribution onboarding men, whom • Capital time, location, processes work in • Innovative/targ etc) • More automated industries providers eted marketing (online) client • Potential • Accessibility retention (Law, Finance, campaign Consulting, IT) strategic • High processes where affiliates customization time/convenienc e is the top factor • Physical • Pop-up stores! • Students going assets • Mobile trucks! ?? into • Intellectual internships?? (A • Internet segment with a (i.e., brand • Dry cleaners very different down the value road) • In-office Service proposition) ? • Fixed costs: salaries and rent (for buildings and potential • Retail equipment) • Potential fees from partners(?) • Variable costs: input costs as per made-to-order, costs of pop- up stores 11
  • 12. Day 3 # of customers: 17 • Suppliers (direct • Low cost garment • Convenience • Highly • Cost-conscious production and personalized mills or distribution • Price new client early to mid- aggregators) • Cut out middle onboarding career men, in man • Accessibility processes • Manufacturers select industries • Innovative/target • High • More automated • Potential agents ed marketing (online) client (Law, Finance, C campaign customization onsulting, IT) retention • Capital processes where time / providers convenience is • Potential the top factor strategic • Students going affiliates • Pop-up stores! into internships • Physical assets • Mobile trucks?? • Network of partners • Internet • Intellectual • Mobile app (i.e., brand down • Dry cleaners?? the road) • In-office Service • Fixed costs: salaries and rent (for • Retail buildings and potential equipment) • Variable costs: input (fabric) costs as • Potential fees from partners(?) per made-to-order, costs of pop-up stores, shipping, agent fee, tailoring costs • Needs to keep COGS in check
  • 13. Day 4 # of customers: 19 • Suppliers (direct • Low cost garment • Price • Highly • Cost-conscious production and personalized new mills or distribution • Convenience client onboarding early to mid- distributors) • Cut out middle man processes career men, in • Innovative/targeted • Accessibility • Automated • Manufacturers marketing campaign (online) client select industries (mobile trucks) • High acquisition and (Law, Finance, C • Potential agents customization retention processes onsulting, IT) • Capital where time / providers convenience is • Potential the top factor strategic • Students going affiliates • Mobile app into internships • Physical assets • Internet • Network of • Women?? partners • Pop-up stores! • Intellectual • Mobile trucks (i.e., brand down • Dry cleaners?? the road) • In-office Service • Fixed costs: salaries and rent (for • Retail buildings and potential equipment) • Variable costs: input (fabric) costs as • Recurring revenue through per made-to-order, costs of pop-up bundling / pre-order stores, shipping, agent fee, tailoring mechanism? costs • Needs to keep COGS in check • Potential fees from partners(?)
  • 14. Day 5 Total # of customers: 66 • Bundling of select products • Personalized customer • Suppliers (direct • Outsourcing of shirt • Price acquisition. Offering one • Cost-conscious manufacturing complimentary mills or • Bulk purchase of • Convenience registration Early to mid- distributors) undergarments direct from wholesalers • High appointment for measurement, fabric career men, in • Manufacturers • Low cost garment production and distribution Customization sampling and basic select industries consultation • Potential agents • Cut out middle man • Repeat appointment(s) (Law, Finance, C • Innovative/targeted • Customer available on request and onsulting, IT) marketing campaign • Capital Service • billable Automated (online) where time / providers client acquisition and convenience is retention processes the top factor • Students going into internships • Physical assets • Pop-up store • Women?? • Network of • Mobile app partners • Internet • Intellectual (i.e., brand down the road) • Fixed costs: salaries and rent (for • Retail buildings and potential equipment) • Recurring revenue through • Variable costs: input (fabric) costs as bundling / pre-order per made-to-order, shipping, agent fee, tailoring costs, measurement cost mechanism? • Needs to keep COGS SG&A in check
  • 15. NEXT STEP … Industries Age Annual Etc.. Income 15
  • 16. APPENDIX 16
  • 17. Potential market size Total Available Market: $13,480.7M (1) Served Available Market: $100M (2) Target Market: $25M Total Market Size US Menswear: Men’s shirts was the fastest growing category in 2011, with growth of 8% in current value Served Available Market terms to US$13.5 billion (1) Our Take: While we estimate custom Target Market shirting e-commerce is a very small portion of US men’s shirt sales, we expect it to grow at a much higher rate than the total market(1) 2011 Men’s Shirts Sales (MENS OUTERWEAR IN THEUS, Euromonitor International, May 2012)(2) Based on J. Hilburn forecasted 2012 sales (>$34M) xnumber of serious competitors in the space (3) 17
  • 18. Testing of hypothesis • Type of Business: Startup • Proposed Experiments: i) Questionnaire; ii) In-person interviews • Hypothesis testing • For each customer segment, more than 70% of potential customers • i) Can’t recognize our value proposition • Ii) Dislike one of the possible proposed channels • Confirmation by potential partners • i) Not a feasible way to gain revenue • Ii) Not a accessible channel 18
  • 19. Competitive Landscape Detail Blank Label Indochino J. Hilburn Customizable – 29# of Style Options Customizable – 61 Customizable – 231 Collection (pre-styled) - 77 If You Know Your Size: -You are expected to have One of over 2,000 "Style - Can enter in details (listed yourself measured Consultants" meet with above) -Indochino offers video customers to measure them If You Dont: measurement tutorials - Enter ten data points that -Indochino will also provide a are typically known by free tape measure customer (e.g. height, - Indochino prefers their weight, collar size, waist) measurement guideline - Measure your own favorite - If a customer prefers to be Fitting Options shirt and provide measured by a tailor, the measurements company provides a form for - Send a shirt and Blank the tailor Label measures it (they provide a postage-paid envelope) - Normally 4 weeks with - Not on website, but 2.5 - Within 21 days for delivery, standard shipping (free) weeks, per the following from time of order -Expedited shipping costs $8 article: - Shipping is free and reduces turnaround to 2 Time - Expediting orders is not weeks 12/jan/29/image/la-ig-shirt- possible - If you mail a shirt to Blank side-20120129 Label, it lengthens the process 19
  • 20. Competitive Landscape Detail (cont’d) Blank Label Indochino J. Hilburn Min Price $68 $79 $89 Max Price $145 $99 $169 - If the shirt doesnt fit, Blank - Indochino will reimburse - J. Hilburn guarantees all Label will make a new one customers up to $75 for items sold and customers from scratch and will donate alterations by a local tailor who wish to return products the unused shirt to charity; - If alterations are to cost due to fit issues or the customer doesn’t pay more than $75 or if the item dissatisfaction otherwise shipping is unalterable, then may return products via their - Customers are allowed a Indochino will remake the Style Consultants single free remake on their customers suit - Return shipping is free of Return Policy* - Customers must go charge first order - If the Pattern Maker or through a claims process to tailor made a mistake, Blank initiate the above requests Label will send a remake - Items can be returned for a and doesnt require the 100% refund if the customer original to be sent back is unhappy with the product; - Remakes are expedited customers are responsible for shipping Reported in June 2012: Per May 2012 article: Indochino has raised about $5 J. Hilburn has raised VC Funding ??? million in venture capital to date, $12.75M to-date and additional funding is “on the horizon” this year.”* Indochino return information on website refers to suits 20