New Product Development& Marketing plan:“Columbia” SnowboardsCorporate Development and Strategies: Alexey TsukanovProduct Development & Research: Fabricio SchnorembergerProduct Augmentation and Communication: Aygun Suleymanova
Company History: Founded 1937 by Paul and Marie Lamfrom in Portland, Oregon. Began as a small hat distributor but quickly expanded into outerwear, sportswear, footwear, accessories, and equipment. Columbia Sportswear CommercialMission Statement: “Columbia Sportswear outfits outdoor enthusiasts with unmatched performance and advanced technology from head to toe with outerwear, sportswear, footwear, and accessories” Key competitors: The North Face, Patagonia, TimberlandIndustry Background Apparel Manufacturing Industry, (subsector Outerwear Manufacturing) $7.2 Billion, 6% growth - 2006 2007 2006 2005 2004 2003Net Sales $1,356,039 $1,287,672 $1,555,791 $1,095,307 $951,786Net Income $144,452 $123,018 $130,736 $138,624 $120,121
Our recommendation is to expand into sports equipment industry by offering a full line of snowboards and snowboard equipment. This strategy fits with Columbia’s mission statement of offering high quality “head to toe” products for outdoor enthusiasts. Sports Equipment Industry Five Force Analysis Threat of Entry: Low. High Brand Awareness, economies of scale. Industry Supplier Power: Low. Rivalry: Medium. Buyer Power: Low. Raw materials (wood) Products are interchangeable products sold through many are plentiful, no threat Numerous established smaller retailers with of forward integration. competitors limited bargaining power. Substitutes: Medium. Other extreme sports such as mountain biking, climbing, etc
- Sports Equipment is a $25 billionindustry. Snowboardingsubcategory of the SportsEquipment Industry is a $500million industry. Cost Leadership Differentiation- Very high growth rate. AtomicCustomer base has increased Broad Empire *Columbia* Burtonfrom 2.5 million in mid 90’s to Marketover 5 million today. Narrow Market Mash- More than half of the marketshare is owned by BurtonsSnowboards.-Opportunity exists for a highquality snowboards offered to abroad market
Strengths: Weaknesses:- Strong brand-name that is - Slowdown in revenue growthsynonymous with quality and due to increased costs anddurability increased competition- Healthy financials - International expansion has- Innovative marketing not been very successful-Reputation as an eco-friendlycompanyOpportunities: Threats:-Very fast growing industry -Economic slowdown may- Strong demand for high negatively affect demandquality, durable products - Unpredictable seasonality and- Emerging markets show good warmer winters may reducefuture potential demand - Burton Snowboards is a very strong competitor
- Columbia’s strategicgrowth entailsexpanding productoffering for everyoutdoor segment- Our recommendationis to acquire a premiumsnowboardmanufacturer andmarket their productsunder Columbia brand
Segment: regular snowboarders-practitioners Size: 7.1 million Growth rate: 30% Access to segment: accessible Geographic concentration: US and Europe Emotional motives: high Company fit & ease of business Other business opportunities provided by the segment: immersion in extreme-sports!
Demographics most snowboarders are 12-to-24-year-olds females make up roughly 25 percentGeographic targeting: US (38 states)Social/cultural influences inspired by surfing and skateboarding came to rebel the more sophisticated way of skiing Snowboarders stereotypes: "lazy", "grungy", "punk", "stoners", "troublemakers"Purchasing behavior: high appealing durable good less frequent purchases greater consumer investment more intensive personal selling
Columbia conveys functionality, durability and high quality associated with active, healthy lifestyle brand extension opportunity: positive consumer expectations, retailer support, leverage current brand awareness, and reduced cost of the launch campaign Create the perception of high value-added product Association with Columbia’s points-of-parity
Achieve market share large enough to consolidate the new product line as a strong competitor in the market. Create an association of snowboarding equipments and Columbia’s name inside the target audience’s minds. Making Columbia’s snowboards available and reachable for any American customer. Convey a high-quality message about the new product line to the target audience. Achieve 5% of market share in revenue measure ($24.4M annual sales) in the second year. Sponsor 2 of the 5 best snowboarding professionals in the United States at the end of 1 year. Sponsor at least 2 major US snowboarding competitions at the end of 1 year. Having snowboards available in all states where snowboarding resorts are popular at the end of 1 year. Reach superior product performance indicators than any industry competitor in 1 year
a board that slides on snow shape with front and back upturned high speed and agility; noscratches, and graphics printed on both sides. 3-years warranty; free engraving; option to customize boards made of lighter materials, such as titanium, aluminum, or carbon fiber.
Performance high performance levels constantly assessed: indoor, in a science lab; and outdoor, a team of pros and amateurs will take the boards to the slopes and subject them to different riding styles and terrains Price-value-quality relationship both amateurs and professionals it is imperative to deliver a high value-added product practice of higher prices than the average of competition
Brand name Logo design Warranty Package trade dress Customer Relationship Building programs Customer Service requirements Trade-in; Financing On-line community building plan Other augmentation › Engraving › Customization