Allbirds 20180405_New Views on Segmentation Targeting_Final Deliverable.pptx

1
March 2018
Research Services
NEW VIEWS ON SEGMENTATION &
TARGETING

2
Research Objectives
RESEARCH OBJECTIVE
To understand a better approach
to target and engage with
consumers in the apparel and
footwear space through
behaviorally predictive
segmentation, and to understand
the use of design targets to
improve the product innovation
and design process to eventually
maximize revenue while
maintaining distinctiveness in the
marketplace
• What are the best practices in behavioral consumer segmentation that
are also predictive in nature?
• How do non-conscious behaviors get integrated in segmentation, and
what are their predictive values?
• What data and segmentation capabilities are available across
geographies – US, EU (UK, France, Germany, Italy, Spain) and China
• How can brands activate the segments:
• To ensure that the right segment is targeted in the right channel, with
the right product at the right price point?
• To ensure the demand is forecasted for each channel correctly for
effective inventory management?
• To identify and define design targets that can be leveraged to
improve product innovations and activate prime consumer targets?
RESEARCH
QUESTIONS 03
01
02
04
Updated

3
Approach and Methodology
Conducted 6* one-on-one
telephonic discussions with
internal VF stakeholders from
within the design and marketing
teams
ONE-ON-ONE DISCUSSIONS
WITH VF COLLEAGUES
Conducted secondary research
accessing reports such as HBR,
articles available in the public
domain (segmentation and
marketing blogs, blogs of
designers, online professional
platforms such as LinkedIn), and
company websites to identify:
• Emerging behavioral
segmentation techniques
• Best practices in identifying
and profiling of design targets
DESK-BASED
SECONDARY RESEARCH
Conducted 6* qualitative
interviews with multiple vendors
to:
• Assess their data capabilities
across different geographies
• Assess their capabilities for
conducting predictive
behavioral segmentation
• Understand how they help
brands in activation post
segmentation
QUALITATIVE INTERVIEWS
WITH VENDORS
Conducted 17* qualitative
interviews with experts across
brands (compete and non-
compete) and geographies to:
• Assess the usage of
observational/ behavioral
segmentation techniques
• Evaluate the usage and
selection of design targets
QUALITATIVE INTERVIEWS
WITH INDUSTRY EXPERTS
Updated
Note: *Complete list of interviews is available in appendix section

5
Expert’s Opinion on Predictive Segmentation Process
While, most experts advocate usage of past behavioral data to predict consumer behavior, the opinion is divided on whether
the segmentation model should use purely behavioral variables or layered with demographic and attitudinal variables
Source: Primary interviews conducted with external stakeholders; Experion; Grail Research Analysis
“Multi-dimensional, dynamic segmentation is much more effective – it may be
challenging to create, but it will be less painful in the long run.”
- Experian, Consumer Credit Reporting Agency
S E G M E N T A T I O N
BEHAVIORAL
SEGMENTATION
Experts suggest using
purely behavioral
segmentation to segment
customer. Once the
segmentation are
identified then
demographic and
attitudinal variables can
be layered in to activate
02 T A R G E T I N G
The segments are quantified based on
the descriptive data retrieved from
retailers, consumer panels, and brands’
own stores. Propensity to purchase
your brand is often used as a key
discriminant in identifying the core
target and prime prospect. Size and
potential growth of the segment also
help in identifying the prime prospect.
01
MULTI - DIMENSIONAL
Some experts suggest using
multi-dimensional
segmentation that relies
heavily on behavioral variables
for a holistic view. It is a
combination of transactional
behavioral data (from PoS)
layered with demographic and
attitudinal is advisable.
PURELY BEHAVIORAL
Others advocate the use
of purely behavioral
variables to segment
consumers. Once
segments are identified
then demographic and
attitudinal variables can
be used to describe
identified segments and
activate against.
03 P R E D I C T I O N
Predictive models are best built
separately for each segment.
Propensity based models are most
often used to predict consumer
behavior after the brand defines the
end objective/ outcome and identifies
the specific behaviors to be studied.
“I think behavioral segmentation is absolutely the way to go…and it is not merely a
matter of segmenting the people on the basis of what they have done, I think it should
primarily be on the basis of what they are going to do.”
– Academic, Wharton School
Dynamic segmentation is now replacing static segmentation
Updated

6
Pre-requisites for an Effective Segmentation Study
Segmentation studies should have a clearly defined objective; they must be cross functional and driven by top management
to be successful
Source: Primary interviews conducted with external stakeholders; Grail Research Analysis
CHECKLIST FOR
EFFECTIVE
SEGMENTATION
STUDY
“Organizations that adopt segmentation for individual paths typically do not
achieve adoption of the segmentation or good execution of the segmentation
across functions. In apparel, one of the big issues is how do you get marketing
and merchandising to work together, how do you align their interests”
- Consultant, ZS Associates
Driven by Top management
Support from top management helps in
pushing forward the segmentation objective
Clear on business objectives and strategies
Segmentation study needs to define the end
objective it wants to achieve to avoid achieving
erroneous outcomes
Cross functional
Segmentation study should involve all functions
to achieve desired adoption of the segmentation
Dynamic in nature
Segmentation to be created in a manner that it can
be updated periodically to reflect evolving consumer
behaviors
Regional
Segmentation study to factor in the regional
variations in consumer behavior
“At Bayer Pharmaceuticals [we] designed creative briefs based on the results of
behavioral segmentation and built an organizational strategy wherein
important segments were targeted with new marketing models. Also, the
existing people in the organization were given trainings around it”
- Consultant, Daniel Epstein & Associates LTD
Training
Appropriate training to be given to key
stakeholders to make segmentation work
Coordinated
Key departments need to be in
coordination to avoid duplication of
efforts and streamlined results

7
Data to be used to Segment Consumers
Experts suggest using PoS data to segment consumers behaviorally layered with demographic and attitudinal data (from
public sources and consumer surveys) for best results
Purchase and loyalty data from
retail partners and third party
providers (e.g., NPD)
Consumers’ credit card data
from data providers such as
Experian, American Credit
Bureau
Online behaviors from Data
Management Platforms
(DMPs)
Proprietary data generated through own
consumer panels
FINAL
SEGMENTATION
Syndicated data sources such as Nielsen, Kantar
Worldpanel, Simmons Customer Surveys1
PoS
Consumer
Panel
Geo location data
for Zip code level
analysis
Publicly
available
“One of the best practices that a number of organizations are adopting is layering new and novel data sources into their segmentations. They are not basing their
segmentations on individual research, but developing their own intellectual property, in terms of having their big data sets to drive their segmentation”
Note: 1A nationally representative study of a continuously fielded survey of approximately 25,000 U.S. adults measuring consumer attitudes, product and brand preferences, media consumption habits and demographic and lifestyle characteristics
Note: Implicit data can be derived by adding a set of
questions to existing surveys (Proprietary and Syndicated
panels) to map sub-conscious consumer behavior
Updated

8
Data Sources for Segmentation
Firms leverage multiple agencies for data sourcing and analysis, based on their expertise. Some names we heard during our
discussion included
Note: 1Lieberman Research Worldwide has a long term relationship with Nike; 2The use of lead generation services to generate prospects database was suggested by an expert. List of lead generation services has been based on desk research
Source: Primary interviews conducted with external stakeholders; Learning from Extreme Consumers Case Study by Jill Avery and Michael I. Norton’, Harvard Business Review, Jan 06, 2014; TechnologyAdvice blog; Grail Research Analysis
Updated
Segmentation
Analysis
Nielsen Spectra
Segmentation
Lead Generation
Services2
Store Level
Data
Nielsen Spectra
Segmentation
Store Level
Data
Nielsen Spectra
Segmentation
Credit Card
Data
Credit Card
Data
Consumer Attitude
& Behavior Surveys
- Syndicated
Consumer Attitude
& Behavior Surveys
- Syndicated
Data
Management
Platform
Data
Management
Platform
Consumer Attitude
& Behavior Surveys
On-Demand
1

9
Key Variables Relevant for Apparel and Footwear Industry
Most relevant behavioral variables to study are purchase channel/retailer, brands purchased, distance travelled for shopping,
buying occasions and frequency of purchase
Updated
“If anyone is advising you to
ignore some variable, don’t
take that advice. We should
look at all variable upfront and
see what they predict”
“After I come up with my behavioral segment, let’s say my tiers of
customers based on their projected lifetime value, then I am open to
using anything, any measures to profile those tiers. So, I have no
problem bringing in demographics, attitudes, bioinformatics,
geolocations, social media usage, or anything that may come up
within those profiles”
“I wouldn’t ignore attitudes and brand perceptions. They
are strong predictors in probability to choose. You may
have behavioral segmentation. In that the biggest
discriminant is propensity to choose my brand”
– Consultant, ZS Associates
KEY VARIABLES USED FOR MULTI-DIMENSIONAL SEGMENTATION
Most relevant
variables to
conduct
behavioural/
multi-
dimensional
segmentation
Behavioral Attitudinal Demographic
DATA
VARIABLES
• Channel type (online/ offline/ hybrid)
• Specific retailer
• Brands Purchased/ Switched
(identified through consecutive purchases)
• Frequency of Purchase
• Buying Occasions
• Distance Travelled for Shopping
• Returns (online purchases)
• Feeling and
sentiments about a
particular channel
• Brand perception
• Gap between the
perception of brand
and that of the
competitors
• Density of certain
segments within Zip
codes
• Age
• Gender

10
Comparison of stated vs. actual responses, latency of response, and mapping of metaphors that consumers use are some of
the approaches taken to understand sub-conscious behaviors of consumers
Relevance of Sub-Conscious Behavior
Source: Conversion Uplift, Working knowledge Article on Subconscious-mind-of-the-consumer-and-how-to-reach-it
What are sub-conscious
variables and why have
they gained prominence?
Sub conscious processes: Essentially, these processes are the behaviors or attitudes that reflect what
consumers actually believe or think
• ~95% of purchase decisions are taken subconsciously. Hence, a study of sub-conscious behavior
becomes important as it allows brands to know the true motivations behind the consumer’s purchase
process
What are key approaches to
understand sub-conscious
behaviors and attitudes?
• Stated vs Actual: Check what consumers state versus the behavior they actually exhibit
• Physiological or response latency measures: Measured by unconscious physical reactions of consumers
• Metaphor elicitation: Study the metaphors consumers use to express their thoughts and feelings
• Shop along and spending time with consumers are a few other approaches adopted
“the subconscious is important and I don't know if there's just one way to go about
that. That's the best, but if you can watch those behaviors …. So we, we do some
things like go shopping with them or just go to their home and hang out with
them.”
– Marketer, Kraft Heinz Company
MEANING
New Slide
APPROACHES

11
Implicit Association test is a scalable and cost-effective method to measure non-conscious motivations and expectations of
consumers
Integration of Sub-Conscious Behavior in Segmentation
Source: Conversion Uplift, Working knowledge Article on Subconscious-mind-of-the-consumer-and-how-to-reach-it
New Slide
M E T H O D
What are key methods used and how they can be integrated into existing segmentation?
Neuroscience Bio Affective Priming
Implicit Association Test
(IAT)
Why it is used
• Offers a scalable and affordable way to measure
non-conscious motivations and expectations (real
influencers) with higher reliability and accuracy.
• Allows marketers to design content and
messages that are emotionally engaging and
psychologically persuasive.
What it does
Measures strength of a person’s
automatic association between mental
concepts and evaluations or stereotypes.
Measured by making people sort words
or images into categories each time they
are exposed to a stimulus.
How it is integrated into segmentation
ORGANIZATIONS
OFFERING IAT
Sentient Decision
Science
COG
Research
Beyond
Reason
“We'll design the implicit module for your
study, but then what we'll do is we'll
embed that within your explicit survey
instrument” – Director of Business
Development, Sentient Decision
Science

12
Use of Dynamic Segmentation
Organizations have lately started using dynamic segmentation instead of static segmentation to study shifts in behavior of
rapidly evolving consumers
Source: Primary interviews conducted with external stakeholders; Research paper on ‘Longitudinal models for dynamic segmentation in financial markets’ published in International Journal of Bank Marketing by Francesca Bassi (Department of
Statistical Sciences, Università degli Studi di Padova Scuola di Scienze, Padova, Italy); “Using Segmentation to Build More Powerful Models with SAS Visual Analytics”, SAS; Software Advice; Grail Research Analysis
“If the segmentation is connected to an online data management platform,
then I can view how behaviors are shifting – what my segments are
shopping for, what they are looking at, etc.”
• Data sources should be connected to the
segmentation model at the back-end to allow
periodic refresh of segmentation
• Dynamic segmentation requires an API to be
built to have live access to data (data from
online purchases/ CRM systems). Other offline
data may be input manually
• Platforms such as Shiny and
Tableau allow for refreshing the
segmentation as and when new
data is updated at the back-end
• Some analytical models found useful for dynamic
segmentation are Markov model, Latent class growth
model
• However, some experts observe that typically all
segmentation models result in largely similar segments
if relevant variables are used.
“The clients who are really living and breathing segmentation today
and are using it cross functionally, have “live segmentation”. They are
looking at segment behaviors as they are shifting quarter over
quarter; in some cases, even month over month.”
Back-end Data
Connectivity
Models for Segmentation Data Visualization to View
Shifts in Segment Behaviors
Updated
A segmentation can be dynamic in two ways: 1. Only the data gets added dynamically; 2. Both data and the model are dynamic

13
Integrated Tool for Dynamic Segmentation
Note: 1Based on a discussion with a Wharton Professor and one of the Co-founders of Zodiac Metrics
Source: “Using Segmentation to Build More Powerful Models with SAS Visual Analytics”, SAS; Software Advice
SAS (SAS Visual Analytics and SAS Visual Statistics) is one of the platforms that provides capabilities for integrating data
from multiple sources, segmentation, prediction and interactive visualizations
New Slide
• Intersection of data management, interactive visualization, and big data analytics
• Predictive modeling, using analytical methods such as decision trees or regression
• Dashboards and scorecards
• Online analytical processing
• Data warehousing
• Both segmentation and predictive models are processed and presented so that the analyst can iteratively get
the actionable output right away
• Score code can be exported for clustering to place new and changed customers into current clusters and obtain
likelihood scores for customers
• Able to predict or assess the likelihood that a customer will buy a product or service or engage in any other
behavior related to business
SAS
Visual
Analytics
and
SAS
Visual
Statistics
Capabilities
Process
Application
Zodiac Metrics1 , a leading consumer data analytics firm just acquired by Nike in March 2018, is one of the firms using SAS platform for segmentation
and analysis

14
More Tools for Dynamic Segmentation
Apart from SAS, there are multiple tools available that offer functionalities including data integration from multiple sources,
segmentation, prediction and visualization
Note: The list of tools is “non-exhaustive”
Source: Company websites; Finances Online
• All these tools provide data integration
and visualization capabilities
• However, some of these tools provide
limited segmentation and predictive
analytics capabilities:
• Spotfire uses a clustering algorithm
to determine customer segments
• Tableau allows users to create
clusters through an automated
cluster analysis option
Some
other
tools
New Slide

15
Quantifying Segments
Brands leverage a multitude of quantitative metrics, including PoS data and internal growth and profitability metrics, to
quantify the segment size and potential
ESTIMATE TOTAL MARKET SIZE CALCULATE SIZE OF EACH SEGMENT ASSESS SHARE OF WALLET IDENTIFY GAPS
Estimate the overall market for the
product category using PoS data
Calculate the size and average consumer
spend on the product category for each
segment, by using PoS data
Use penetration metrics and total
market size to calculate the share of
wallet for your brand in the product
category
Compare your market share in the
product category with growth and
revenue potential of each segment
to identify segments to target
01 02 03 04
“We have panel data, we have buyers and we have purchase transactions…Once we define our segments and create the hierarchy, then we overlay your
descriptive statistics – revenues, shares, growth rates, profits, market share. This helps size the segments”
- Consultant, Hendry Partnerships

16
Identifying Prime Prospects through Segmentation
Most brands using behavioral or behavior-heavy multi-dimensional segmentation use propensity scores to identify “Core
Segment” and “Prime Prospect”
Highest
Propensity
Consumer
Current
Purchasers. Most
Likely to Buy
Now
Future Primary
Buyers
Next Highest
Propensity
Consumer
Economically
Viable
Prime
Prospect
Key Revenue
Generators for
your Brand
Core
Segment
Order segments based on
propensity to choose your brand
(key discriminant in
segmentation)
Highest propensity segment –
already buying your brand
Next highest propensity
segment – identify gap
(propensity vs. actual share) and
understand drivers of the gap
Size the segment to check
economic viability of targeting
using contribution margins on
products bought

17
Identifying Prime Prospects through Trendspotting
Rather than conducting a formal segmentation, brands often leverage ‘trendspotting’ to identify and target prime prospects
and accordingly redesign their product offerings
“The two main future challenges for airlines will be operating with the sheer numbers of older flyers and retrofitting meaningful products and services that
will cater to the specific needs of an older customer without overtly positioning these innovations as age-centric. We call this challenge ‘new design for
old”
- Paul Wylde, CEO and Creative Director, West Coast Boutique
Looking at growing ageing population (50-70 year), BMW Designworks studied this
segment further through news and analysis across public sources (Forbes, AGEIST) and
identified the trend of disproportionate spending by this demographic.
The segment considered air travel a necessity rather than a luxury. This segment was
largely ignored by airlines when designing aircraft and services until then.
The segment was also identified as an influencer and a design target (specifically a
mobility-constrained elderly consumer), as fulfilment of their needs was expected to lead
to the most premium offering for consumers of all ages and their buying choices
expected to influence the next generations.
“This experienced filter on travel tells us all a lot about what is truly meaningful – and we should listen. The experienced traveler’s wise perspective is
invaluable for interpreting premium experiences for consumers of all ages. In addition, their purchasing choices trickle down to other generations
making their influence even stronger”
- Garen Moreno, BMW Group Designworks’ director of Strategic Partnering
Source: ‘The Aging Traveler’, Apex, Mar 24, 2016; ‘APEX Direct With BMW Group Designworks’ Garen Moreno’, Apex, Mar 29, 2016; Grail Research Analysis
Prime
Prospect

18
Predicting Behavior through Segmentation
Propensity models are used to predict consumer behavior against specific objectives
Note: Models such as Markov Model are commonly used to run such simulations according to some experts
Source: ‘How to Use Predictive Purchase Behavior Modeling to Understand Consumers, Hubspot; Primary interviews conducted with external stakeholders; Technologyadvice; Grail Research Analysis
The prediction process starts with defining the
objective. For example, level of discounts to
offer to different ‘prime prospects’ through:
• A merchandising centric campaign such as
clearance sale
• A marketing campaign to initiate first time
purchase
Based on the objective, a propensity model can be
selected that uses behaviors relevant to the objective as
inputs.
For example, a ‘likelihood to buy’ model may compare
pre-purchase behavior (types of emails opened, time
spent on researching different products, etc.) of
prospects to pre-purchase behaviors of actual buyers to
identify the ”high likelihood buyers”.
There are specific lead generation services companies
that provide lists of prospects to brands. Some of the
key agencies include Red Ventures, Discover Org,
RainKing, Callbox, Netline, Technology Advice
The brand may then decide to identify, for
example, the level of discount to offer to
different target consumers to achieve stated
objectives (e.g., clearance sales/ acquire new
consumers).
“The quality of prediction depends on the quality of data”
Define the
Objective
Use Propensity Models/
Simulations
Activate
Define the
Objective
Updated

19
Types of Propensity-Based Predictive Models
Different propensity models are used for different brand objectives, e.g., customer acquisition, engagement, increasing
share of wallet etc.
Source: Destination CRM; “Using Propensity Modeling to Drive Revenue and Increase Engagement”, Association analytics; Linkedin, Blog Hubspot
New Slide
Propensity
to Buy
Propensity to Buy
for Repeat Buyers
Propensity
to Churn
Propensity
to Unsubscribe
Propensity
to Engage
O B J E C T I V E
To understand prospects who need a little more
incentive in order to complete the purchase
To identify consumers who have a large lifetime
value, in order to make increase revenues and
profits for the brand
To study current consumer to identify “red flag”
behaviors mapped from previously churned
consumers
To identify consumers who are over-saturated
by brands marketing efforts and on the verge of
unsubscribing
To measure customers’ likelihood to engage
with a particular marketing effort
A C T I V A T I O N E X A M P L E
Marketers can then alter the way they interact with high-
likelihood buyers to increase the likelihood of closing a
sale. For example decide how much of a discount to offer
to a certain customer
Invest more in those acquisition channels and campaigns
that produce those high lifetime value consumers
Consumers identified are passed to a sales team for
further follow-up, and can be transitioned into an
education-focused nurturing campaign to retain
Post identification the frequency of marketing efforts
directed towards this set of consumer can be decreased
such as the number of emails sent
Using the knowledge of likelihood to open emails, a brand
can then decide not to send an email to a certain “low
likelihood to click” segment
P R O C E S S
All propensity
based models
essentially predict
the behavior of
prospects by
comparing it with
the behavior
exhibited by
actual consumers
when they were in
that particular
stage

20
Statistical Methods for Propensity-Based Modeling
Logistic regression is the most used method for propensity-based modelling as it is simple to implement, gives reasonably
accurate predictions, and offers a clear explanation for low and high propensities
Source: Destination CRM; “Using Propensity Modeling to Drive Revenue and Increase Engagement”, Travel Data Daily, Association analytics; Linkedin
New Slide
HOW A TYPICAL
PROPENSITY
MODEL IS BUILT
Propensity model can be built using a number of statistical methods:
Logistic regression is the most used across industries
L O G I S T I C S
R E G R E S S I O N
P R O B I T
A N A L Y S I S
D I S C R I M I N A N T
A N A L Y S I S
T R E E - B A S E D
M E T H O D S
R A N D O M
F O R E S T , E T C .
Why logistic regression is most used in
building Propensity based models
• Provides reasonably accurate results
• Offers a clear explanation as to why the propensity is high or low for some client
Note: Although more sophisticated models such as tree-based methods and
probit, improve accuracy, tracking their results back to the actual characteristics of
consumers is nearly impossible
• As a general rule of thumb, 70% prediction accuracy is considered good enough
for prediction
“Realistically you should only expect to be
65% to 75% predicted success”
How a typical propensity-based model is read
and subsequent steps taken
• Propensity scores from a logistic regression may range from 0 to 100
• It is advisable to incentivize consumers in the middle who need a little push to
take action (e.g., to buy your brand) rather than those at the two extreme ends.
• Those with extremely high propensity (e.g., 80-100), are expected to take
action without any incentive (need-based)
• Those with extremely low propensity are unlikely to be responsive to incentives
Least Likely Most Likely
0 100

21
Finding the Link between Design Target and Prime Prospect
Experts suggest that the common link between Design Target and Prime Prospect is the core benefit derived from a product.
However, the Design Target and Prime Prospect should differ on parameters such as product knowledge and price sensitivity
• Knowledge of the product/brand
• Amount of time they spent in shopping and
researching the category
• Marketing communication – Type of marketing channel
viewed/ consumed
• Price sensitivity – Design targets are most likely to pay a
premium whereas prime prospect might not be willing to pay
a similar premium as the design target
Differences can exist on following parameters
The core benefit derived from the product should be same between the design target and prime prospect.
CORE
BENEFIT
DESIGN TARGET PRIME PROSPECT
Ideally, all functions in an organization should know about the core segment and the prime prospect. However, knowledge about design target is most
useful for designer and marketers

22
Best Design Targets are ‘Extreme’ Consumers
Extreme consumers are often used as design targets, as their needs and ideas are more likely to result in offerings that
exceed the average consumer’s expectations
Source: ‘Learning from Extreme Consumers Case Study by Jill Avery and Michael I. Norton’, Harvard Business Review, Jan 06, 2014; ‘IDEO: Service Design (A)’, INSEAD, 2006
AVERAGE CONSUMER EXTREME CONSUMER
Assessing behavior of extreme consumers helps to predict, guard against,
and capitalize on disruptive market forces.
Extreme consumers are chosen as they are able to provide insights for
design improvements
“By concentrating solely on the bulge at the center of the bell curve…we
are more likely to confirm what we already know than learn something
new and surprising”
- Tim Brown, CEO of IDEO

23
Using Extreme Consumers to Design for Prime Prospects
Source: ‘Learning from Extreme Consumers Case Study by Jill Avery and Michael I. Norton’, Harvard Business Review, Jan 06, 2014
Extreme consumers can be identified through segmentation, social media listening and online panels by third party
providers, among other methods
The fringe Product category
virgins
Consumers with
constraints
Lovers, haters and
opt-outers
Heavy buyer/
Consumer
Extreme personalities such
as goths, geeks, punks. May
be identified using online
panels by organizations
such as Sense Worldwide
Individuals with no or
little knowledge of
product
Individuals with physical
constraints, disability etc.
Preachers or haters of a
particular product/brand.
Maybe identified through
social media
Individuals with extreme
or a very high level of
usage of a product/brand
and are identified
through segmentation
Red Bull used ravers, who
had to stay up all night to
test the product concept and
came up with the positioning
“giving you wings”, which
appealed to larger audiences
Advertising agencies ask
men to try female products,
e.g., wear high heels or
shave their legs to observe
the reaction of a potential
consumer who has never
used the product
Ford
engineers designed cockpit
of car for elderly people by
simulating physical
constraints by wearing a
jumpsuit
Running shoes developed
by designers of Vibram’s
Five Fingers after studying
barefoot runners who had
rejected running shoes

24
Things to Know about Design Targets
Understand the extent to which the design
targets are engaged with the category
Have the first person account of what the
extreme consumer’s daily life looks like
Analyze social media behavior, through
facebook feeds, Twitter, etc.
Analyze multiple variables, including but not limited
to, frequency of purchase, product preference,
other brands chosen, and buying occasion
Collate information on what are common
beliefs of the lovers and haters and on what
beliefs do they differ
Understand who their leaders are and why
do they follow them
To generate useful design ideas, it is important to know the design target holistically; this includes studying their purchase
behavior, level of engagement with category, daily routines, social lives, values, beliefs and leaders they follow
Source: ‘Learning from Extreme Consumers Case Study by Jill Avery and Michael I. Norton’, Harvard Business Review, Jan 06, 2014; Grail Research Analysis
What to know
about your
design target
Leaders
Day-to-day
routine
Social
interactions
Category
Level
Common/
Opposing
Beliefs
Purchase
and Usage
Behavior
Values
Understand the concepts they consider
important such as perseverance,
conservation of environment, equality etc.
Engagement

25
Methods to Study Design Targets
Behaviors of extreme consumers may be studied using methods, such as shadowing outliers, empathy tools and body
storming
Source: ‘Learning from Extreme Consumers Case Study by Jill Avery and Michael I. Norton’, Harvard Business Review, Jan 06, 2014; Stage 1 in the Design Thinking Process: Empathise with Your Users’, Interaction Design Foundation, Jun 2017
Assemble a diverse mix of
individuals for a group
discussion to ensure
diversity of opinions and
unconventional ideas
CONDUCT AN
UNFOCUSED GROUP
Identify 5-6 outliers and
shadow them while they
interact with the product or
service. Shadowing helps in
understanding day-to-day
routines, social interactions,
and purchase and usage
behavior of these consumers
SHADOW
OUTLIERS
Restrict your own regular
activities or movements to
simulate the conditions faced
by some of the constrained
consumers of the product
UTILIZE
EMPATHY TOOLS
Track conversations of
consumers in online brand
communities (fans and
haters) to identify needs and
gaps
CONDUCT A
NETNOGRAPHY OF
LOVERS OR HATERS
Become an extreme
consumer of the product for
a defined time period to
gather insights into the
experience of such users
GO EXTREME
YOURSELF/
BODYSTORMING

26
Activating the Prime Prospect
The prime prospect is activated via product optimization and revised pricing, channel selection and devising specific
marketing campaigns
• Do we have the data to actually affect these
decisions, e.g., channel behaviors, effect of
variable pricing on purchase decisions, etc.?
KEY QUESTIONS TO BE ANSWERED BEFORE MOVING TO ACTIVATION
• How our prediction of consumers’ behavior
might be different from actual behavior based
on merchandising or actual pricing?
• Guide marketing teams in media
channel selection/ purchase
planning and placements in digital
(facebook, Instagram, email) where
consumers are spending time
socially
• Select messages that drive
differentiation
• Draft a story to build media
campaigns
• Guide product development
teams in terms of what
innovations were required and
the storytelling that resonates
with consumers
• Optimize product assortment
based on the potential SKUs that
can appeal to the consumers
• Revisit product pricing to make it
more competitive to keep a
check on switching
• Revise consumer channel strategy
by identifying the channels where
prime prospects most visit
“There is a need to prioritize
distribution channels based on
segmentation. A mom would not
go to 7/11 or CVS, while an 18
year old will. There is a need to
assess which channel would you
use for your segments.”
- Brand Manager, CPG Company
MARKETING &
POSITIONING
PRODUCT
& PRICING
CHANNEL
STRATEGY

27
Integrating Segmentation with the Marketplace
Linking own proprietary segmentation to third party segmentations (retailers’, media buying agencies’) through a typing
tool is most commonly used method for integrating the segmentation with the marketplace
Retailers have their own segmentations and they want to know how
their segmentation aligns with yours…Very often it's just a question of
interpretive typing algorithms into research. So for example, in the
original survey, we can take Walmart segmentation algorithm and insert it
into that survey, the alignment on the back end as we're building our
proprietary snacking segmentation…You're just stacking one on top of
the other…That is the process of practically linking segmentations
together.
– Consultant, ZS Associates
The way we do it is by creating a typing tool (i.e., short list of questions
that can be added to any consumer research study to predict which
consumer segment a consumer belongs to). By using a tool like this,
we are able to split research results by segment, which allows us to
integrate consumer segmentation to the marketplace. We also have
pre-screened consumer panels that allow us to get quick reads on
specific questions.
– Consumer Insights Professional, Vibrado Technologies
New Slide

28
Activations through Integrated Segmentation – Marketing
Marketers may use tools, such as DMPs and typing tools, to integrate segmentation with marketing activities, including
campaign testing, media buying and digital marketing
“Those moving toward this sort of planning have licensed
data-management platforms…makes it possible to buy
media against a persistent segmentation across which
users are moving, sometimes overnight. But the costs and
effort required are considerable. I expect new companies
who grow up operating this way.”
– Media Executive, Horizon Media
“There is a mechanism or a panel that is tracking behavior.
So for example, Nielsen media panel or Facebook. So for
example, on immediate panel I can say, look, my target
segment is really watching reruns of popular American TV
show, Friends and therefore, I should be buying advertising
[during that telecast on the channel].”
Buy Media based on Changing Segment
Behaviors Tracked by Data Management
Platforms
“We were only in the initial stages of doing this at Under
Armour by creating fields in our CRM database to
highlight which segment a purchasing customer was in
and then cross-correlating that information to other
demo and purchase behavior to drive our digital
marketing programs (primarily email but also some re-
targeting).”
– Consumer Insights Professional, Vibrado
Technologies
“One of the most important [pieces] in terms of being
able to activate and leverage the findings of the
segmentation study, is the development of a typing
tool. It's a series of questions that will help categorize
people inside of the universe…into one of the different
segments…identified through segmentation
study…Generally, while in theory these segments are
distinct and unique. In reality, a lot of times…it's very
difficult to just speak to any given segment, right? So
we…focus on channels that we know have a higher
index of traffic from any given segment…We then
create different versions of creative and then we
do…A/B testing and then continuously optimize.”
– Marketer, Campbell Soups
Test Marketing Campaigns in Relevant
Channels by Segmenting Retail Panels
through Typing Tool
Drive Targeted Digital Marketing
Campaigns by Creating Segments in the
CRM Database
New Slide

29
Activations through Marketplace Segmentation – Product Innovations
Athletic apparel brands such as Nike design use their own segmentation to design for the alpha consumer, which creates a
halo effect downstream. They also develop specific designs for retailers based on retailers’ segmentation
Source: Primary interviews conducted with external stakeholders; Nike Website, Company Websites Grail Research Analysis
New Slide
“There's a lot of halo effect to an athletic
industry…And we would kind of look at how to break
out our line plan across different value
channels…we're going to need a shoe that's for, a
Famous Footwear or DSW shoes or…some of them
more value channel...for Foot Locker. So sometimes
we'd design products specific for one account…We do
it all the time. So it was really a mapping…it's retail
consumer mapping…We would focus on the Nike
and Jordans and no wonder we were really focused
more on, you know, the Alpha consumer more
knowing that if we connected with them and then it's
a lot easier for the retail brand marketing teams to
create a more customized plans, you know, for that
retailer. So...there's their plan, how to reach their
customers totally different than Footaction and
Footlocker. So we rely [on retailers] on a product
development standpoint.”
– Marketer, Alpha Squad Consulting
Pinnacle Product for each Product Category
Gym Running Baseball Skateboarding
Retailer 1
Retailer 2
Retailer 3
Lower priced
products with
designs inspired by
the pinnacle product.
However, these
products may have
lesser features/
relatively lower
quality material to
cater to the mid- and
low- consumer tiers.
Color variant in existing
design.
Minor change on sole
thickness.
Designs based on
Brand’s Segmentation
Designs customized to
Retailers’ Segmentation
New material for the
shoe vamp.

30
Vendor Data Capabilities Analysis/Analytical Capabilities
Presence across
Markets of Interest*
Kantar
Worldpanel
• Online panel of 15,000+ individuals across fashion space
• Capture demographic as well as purchase data across
various variables such as product purchased, age, social
class, life stage, location, etc.
• Can provide raw data captured across fashion space
• Can create new segmentation as well as map existing
segmentation onto their panel
• Panelists are tracked over a period of time and hence
KWP can map evolution in purchase behavior
longitudinally
US, UK, Germany, France,
Italy and China (limited)
Experian
• Capture demographic, behavioral and expenditure data
through surveys, national census and external vendors
• Capture variables such as age, gender, shopping habits,
household income, buying frequency, purchase occasion
and life stage
• Pre-built segmentation tools
• Build custom segmentation using all data available
In-depth coverage across
US and UK. Information on
other markets not available
Ipsos
• Data is collected through surveys and big data
• Variable such as purchase frequency, overall liking or intent
to buy are captured
• Segmentation techniques are applied to attitudinal,
psychographic or behavioral data
• Segments are then profiled on demographics and / or
behavioral variables
• Techniques like CHAID analysis are used
Information not shared by
the vendor
Vendor Capabilities (1/2)
New Slide
Key markets of interest are US, UK, Germany, France, Italy and China

31
Vendor Data Capabilities Analysis/Analytical Capabilities
Presence across
Markets of Interest*
Sentient
Decision
Science
• Use survey methodology to capture sub-conscious
consumer behavior.
• Some of the variables captured are emotion associated
with a brand which can positive as well as negative
Key implicit applications
• Brand Self-Identification: Implicit self-identification
quantifies the strength of the relationship between the
concept of self and your target concept
• Psychographic: Prime the respondents with relevant
semantic or emotional traits and relate these results to
other dependent variables to categorize their relative
importance
• Brand Meaning: Segment consumers based upon their
automatic, gut-level perceptions of the brand as
provided by this discrete association test
US, UK
NPD
• Data is collected through surveys
• Can provide consumer tracking data
• Captures demographic, behavioral and purchase data
• Screening is done based on past 7 days purchase data China
Zodiac
Vendor Capabilities (2/2)
Zodiac has been recently acquired by Nike (Mar’18)
New Slide
Key markets of interest are US, UK, Germany, France, Italy and China

32
Data
Capability
Kantar Worldpanel: Capabilities (1/2)
Kantar Worldpanel maintains an online panel of 15000+ consumers in fashion space across the UK to capture their purchase
behavior; they also provide this data separately, depending upon the nature of request
Online Consumer
Panel
• Who are members: Online Consumer Panel of 15,000+ individuals aged between 16-79 across fashion space
• How panel is formed: Panel members are balanced demographically and weighted up to represent whole of
Great Britain
• How frequently data is captured: Data is collected every 4 weeks where panel members report back an online
diary for their purchases across various variables
• Variables captured:
Separate data
provision
• Kantar worldpanel can provide raw data dependent upon the type of query and details required
• Age
• Gender
• Social Class
• Lifestage
• Location
• Employment Stats
• Urban or Rural
• Attitudes
• Size
• Price Paid
• Preferred Grocer
• Media Consumer
• Product Purchased
• Bought for whom?
• Purchase Channel
• Retailer and Brand
• Full Price/Discount
“We are able to provide flat files of information. We can provide the individual panelists level data”
New Slide

33
Kantar Worldpanel has the capabilities to create new segmentation as well as map existing segmentation into their panel
Dynamic
segmentation
• Although segmentation is static in nature, the panelists are tracked over a period of time and hence
KWP can map evolution in purchase behavior longitudinally
• Kantar recommends to do segmentation annually but typically their clients prefer to refresh in 2
years or more due to its cost-intensive nature
Kantar Worldpanel: Capabilities (2/2)
Segment from
Scratch
Map Existing
Segmentation
• Kantar worldpanel has the capability
to create new segmentation based
on their online consumer panel
across fashion space
• They can also map existing
segmentation to their own panel
Segmentation
Capability
New Slide

34
Appendix A
List of Interviews

35
List of Interviews (1/4)
INTERNAL STAKEHOLDERS FROM VF
INTERNAL STAKEHOLDERS-
CATEGORY
BRAND NAME REGION
Designer The North Face Jason Israel US
VP Product and Merchandising The North Face Darren Cookson EMEA
VP Design Wrangler Vivian Rivetti US
VP Brand Timberland Argu Secilmis EMEA
VP Marketing and Merchandising Timberland Christy Kilmartin APAC
VP Global Product Design
and Creative Director
Timberland Christopher Pawlus US

36
INDUSTRY EXPERTS
Academic VF Corp 20+ years
Academic/ Consultant Gates Foundation, Bayer Pharmaceuticals, and Intel 20+ years
Consultant Gates Foundation, Bayer Pharmaceuticals ~14 years
Consultant CPG, Retail, Lifestyle, Consumer Technology, Telecom ~15 years
Consultant (Follow-up interview) CPG, Retail, Lifestyle, Consumer Technology, Telecom ~15 years
EXTERNAL STAKEHOLDERS-
CATEGORY
University of California Irvine, VF Corp.
Duke University, Catalyst
Behavioral Sciences
Daniel Epstein & Associates LTD
ZS Associates
ZS Associates
CURRENT ASSOCIATION INDUSTRY EXPERIENCE EXPERIENCE
Academic/ Consultant VF Corp, P&G 30+ years
Academic/ Consultant Telecommunications, Financial services,
Gaming, Retailing, Pharmaceuticals
31+ years
University of California Irvine, VF Corp.
Wharton School of the University of
Pennsylvania; Zodiac Metric
Updated
Consultant Milward Brown, Mediaedge, Kraft, Pepsi 30+ years
Hendry Partnerships
Consumer Insights Professional Nike and Gap Inc. ~20 years
Wildwood Advisory Group

37
INDUSTRY EXPERTS
13+ years
Marketer Nike and Adidas ~14 years
Designer Nike 20+ years
Designer Samsung Electronics 25+ years
Marketer Kimberly Clark, Unilever ~20 years
EXTERNAL STAKEHOLDERS-
CATEGORY
Independent Brand Consultant
Materials Move
Samsung Electronics
The Kraft Heinz Company
CURRENT ASSOCIATION EXPERIENCE
INDUSTRY EXPERIENCE
Marketer Nike, Under Armour, and Adidas
Marketer Nestle
Alpha Squad Consulting
Nestle Pure Water Life
17+ years
Marketer Red Bull, PinkBerrry, Nestle ~20 years
Campbell Soup
Consumer Insights Professional Under Armour, American Eagle, UACF, Threat 15+ years
Vibrado Technologies
20+ years
Updated

38
VENDORS
DESIGNATION
Executive Director,
Brand and Innovation Research
Head of Fashion Division,
KWP UK
Alliances & Strategic Partnerships,
Consumer Insight & Targeting
Marketing Specialist
Company
Ipsos
Kantar Worldpanel
Experian
NPD
Lieberman Research Worldwide
Sentient Decision Science
NAME
Vidya Sen
Michael Mackenzie
William Shaw
Chelsea Gannage
John Drake
Director of Business Development
Eva Qian
Client Service Manager –
Sports & Leisure
List of Interviews (4/4) New Slide

39
Appendix B
What We Heard from Internal
Stakeholders at VF…

40
Current Segmentation at VF – Existing Models
Brands across VF are not necessarily following an existing segmentation created by the consumer insight team; rather they are
using different approaches to target consumers across regions
WRANGLER
THE NORTH FACE TIMBERLAND
US
US | EMEA US | EMEA | APAC
According to Design team, Wrangler’s consumer
segmentation is based on three lifestyles -
Traditional, Western, and Modern
• It follows an Integrated Market Segmentation,
wherein the above lifestyles are further segmented
based on demographic of age
Use in Design Process
• Wrangler focuses on specific consumer within
each segment – young man, traditional guy,
western guy, young lady, etc. – to address their
needs, which are assessed from consumer insights
research, by innovating products in terms of
iconology, hardware, wash, finish, graphics, etc.
Designers at TNF follow a territory based
segmentation with four product territories,
comprising Mountain Sports, Mountain Lifestyle, Run
& Train, and Urban
• This segmentation is for the higher price points,
and there are no segments for lower tiers
However, the design and product teams are working
proactively to enhance the segmentation
• TNF US: The design teams have segmented the
lower tiers under self-generated segments based
on research, consumer reviews, and assessment of
value chain
• TNF EMEA: The Product team mentioned having
consulted Vice, a London based agency, to devise
a more attitude and behavior-based segmentation
• In EMEA, the brand team at TBL mentioned using
distribution-based perspective in product
development and felt the need for a consumer
type based segmentation
• For APAC, the marketing team has identified two
segments based on experiences:
– Outdoor (Social)
– Travel
• However, they are still not utilizing this
segmentation to completely base their products
on these segments
Source: Primary interviews conducted with internal stakeholders; Grail Research Analysis

41
Current Segmentation at VF – Key Advantages
The design teams at Wrangler and TNF are content with their existing segmentation models. Wrangler believes its model
to be well-defined, and TNF’s segmentation has been effective in establishing the brand and enabling product innovation
• For TNF US, segmenting the lower tiers has enabled the design teams to
have a well-defined perspective for the kind of consumer they are building
their products
• For EMEA, the product team found the channel-based
segmentation to have been successful in the past and helped the
brand create a good impact on media
• The design team considers existing segmentation to be well-
defined and robust enough to help Wrangler to span through a
vast consumer base
– This also provides clarity to the designers and merchandisers
in terms of what products are being created for whom
KEY ADVANTAGES
“…there was clarity between different
lifestyle segmentations, and within the
lifestyle segmentations the product
segmentations so, that is pretty good for the
alignment in merchandising, design, brand
and marketing.“
– Vivian Rivetti, VP Design (US)
“It is beneficial for us, we are able to scan
through a large set of consumer, from a
traditional consumer to a modern
consumer and then, of course we have this
very precious western lifestyle which is a
certain couture and lifestyle within our
brand DNA“
“…which is where we were with
segmentation 1.0. It was very
linear and it was very successful
in having a media impact…“
– Darren Cookson, VP Product
and Merchandising, EMEA
“…to provide some direction there, we created, we
split our lower business into two focuses and those
were framed around hiking which is our volume
space within mountain sports…A lot of it came
from research and it came from us being users in
the space and speaking with people and
understanding what our distribution partners look
like “
– Jason Israel, Design Director (US)

42
Current Segmentation at VF – Needs and Challenges
Despite its advantages, TNF’s segmentation lacks an emotional aspect in creating segments and does not imbibe inputs
from retail partnerships. TBL’s segmentation misses out on considering the needs of the local consumers
NEEDS AND CHALLENGES
• In the US, designers feel that the absence of distribution-based segmentation has
created a disconnect between designers' perception and product positioning by
the retailers, leading to a difference in product demand
– It also lacks segmentation for lower tiers
• In EMEA, the product team thinks they require a more dynamic segmentation
based on consumers’ emotions rather than logical thought
– They also state a need to have region-specific product development and a
global concept to lead all the markets
• Due to the difference in consumer behavior across different markets, brand
and marketing teams believe that TBL should have an omni-channel strategy
and multiple segmentations pertaining to different geographies, rather than
adopting a global approach
• For EMEA, the brand team thinks the focus should be on understanding the
needs of end consumer to tap into the potential consumer base
“So, our territory model is very much about
the consumer and the mind-set...while our
distribution channel is about where and who
are partnering with products…that product
that we believe is truly mountain sports
product or is that fulfilling a consumer need
that is kind of just like resonates with an
outdoor brand but really is just a (need)”
“…which is where we were with
segmentation 1.0…but that was really
nearly three years ago now so, we are
looking to try and understand the
consumer and their emotional side to
build segmentation “
– Darren Cookson, VP Product and
Merchandising (EMEA)
“What we look at is that opportunity
between finishing the hike and being in a
restaurant, which is so true to an Asian
consumer. They are not going to sweat;
they are not going to need to change,
which might not be so in America and
Europe...whereas Europe is very much a
style driven organization.“
– Christy Kilmartin, VP Marketing and
Merchandising (APAC)
“Maybe we need multiple consumer
segmentations, not one – we stick with the
one we were obsessed about it but
America never worked against that one, I
can tell you that…“
– Argu Secilmis, VP Brand (EMEA)

43
• The design teams at TNF US analyze the status
quo of their products to identify gaps and
ascertain ways to improve them
– The team gathers insights on the industry
and TNF’s products, which are bolstered
with the insights from the product
managers and merchandising team
– It provides the team with a basic
architecture of the product, which is
followed by exploring the ways to address
consumers’ needs
– They also analyze competitors’ products
and performance
• A similar approach is followed by TNF EMEA
product team, wherein they leverage consumer
insights gathered from the consumers and
store owners, in addition to brand image
• The design team at Wrangler focuses on
developing products that are better than their
previous offerings in terms of designs,
materials, usage, etc.
– They mostly design by intuition and
existing consumer insights that they have
in terms of their attitudes and lifestyle
– These insights are gathered by regularly
connecting with the consumers of the
brand to assess their product purchase
and usage behavior (analysis of their
closet)
• Additionally, they leverage forecasting agencies
such as WGSN and market trends, which are
validated against consumer insights
• Design team at TBL US has collaborated with
BMW to refine the design strategy to have a
cohesive look at their design, innovation, and
consumer strategy
– This has helped it align their past
consumer insights and understand the
women consumer
– They also partner with trend forecasting
companies such as– WGSN, Trend Stop,
Fashion Snoops and Stylus
• Marketing and brand teams at TBL, APAC and
EMEA, utilize consumer insights from OLS
research conducted previously
– These are bolstered with consumer
research undertaken at the local level
around consumer lifestyles and behaviors
– In the EMEA, design philosophy and
conceptualization is centered around
traditional image of the brand
Existing Design Process at VF – Product Innovation
TBL carries out extensive research to plan their design and consumer strategy, while TNF and Wrangler focus on the
improvement of their offerings by assessing regularly gathered consumer insights

44
Existing Design Process at VF – Design Inspirations
Wrangler and TBL have used design targets in the past, but they do not have any design targets defined for current design
processes. In case of TNF, professional athletes act as design targets for the US design team (Summit series), while the
EMEA product team relies on consumer insights for designing products
The design processes at TNF vary across
geographies. While TNF EMEA avoids using design
targets, TNF US leverages the members of their
athletes team (Summit Series for mountain sports) as
their design inspiration
• Designers (TNF US) connect with athletes on
one-on-one basis to understand their needs,
when they are going for mountain climbing
• They are also focusing on creating an emotional
connect by listening to the actual stories of their
experiences and using them as design
inspirations
Currently, the designers at Wrangler draw
inspiration from the Runway and consumer
insights
• In the past, when the designers did not have
access to consumer insights, they consulted
with consumers about their needs and usage
– what do they like, what do they need, what
do they do with their jeans, etc.
• TBL designers do not use design targets and
product innovation is based upon brand value
and research briefs describing consumers
– The designs are tested against the insights
they have from consumers in terms of their
needs and brand's perception. One of the
insights, for example, was that Style
Performance Good (SPG) segment
resonates with consumers globally
• However, before TBL's association with VF, they
had a design target developed by IDEO in the
form of a photo-biography
One of the insights, for example, was that Style Performance Good (SPG) segment resonates with consumers globally

45
Existing Design Process at VF – Key Advantages
Designers and marketers believe that design targets drive inspiration, provide basic product architecture, and reduce
production time by saving research efforts. However, the product team at TNF EMEA prefers consumer insights, as they
provide a better picture of their target consumers
KEY ADVANTAGES
• With regular interactions with professional
athletes, they have created a holistic database of
their needs, which provides the designers with an
idea of core consumer’ needs
– This database is leveraged for designing
products
• TNF EMEA: They have an enormous databank of
consumer insights, which helps innovate better
vis-à-vis relying on using design targets
• While the design team at Wrangler does not use
design targets, they cite that the availability of
design targets can enable them to cut short on
research time invested in validating designs
against consumer insights
– Hence, products can hit the market in ample
time to save resources
• Currently, BMW creative vision helps them build a
better understanding of the existing consumers,
particularly women consumers
• The erstwhile design targets helped drive
inspiration at TBL
– The design targets developed by IDEO
included pictures highlighting brands they
shop, photos of their closets, photos of them
getting ready for the day and doing several
different activities throughout the day
“…tell me about the six most important pieces that you
might bring and tell me about the storage you need and
so on and so forth. We have gained a lot of that type of
knowledge and we have a lot of strong documentation
and research behind that.”
“Saying that there could be a muse out there that can help
us capture, collect and validate the…that is great…cutting
out research a little short and if that muse actually be able
to quantify representing more than just herself/himself…I
think it will be important”
“Timberland worked with IDEO…they had photos and an
8'x2' banner…that highlighted different aspects of their
life - things like brands they shop, photos of their closet,
photos of themselves getting ready for the day and
different activities.”
– Christopher Pawlus, VP Global Product Design and
Creative Director

46
Existing Design Process at VF – Key Challenges
TBL’s design process lacks consumers emotions, and designs are based on designers’ gut feeling; they also cite the need to
streamline existing processes to tap into consumers’ demands. At Wrangler, it gets difficult to innovate and bring new
products every season
KEY CHALLENGES
• At times, it is difficult for designers at Wrangler to innovate and bring new
product for every season
• The APAC marketing team feels that the current process does not allow TBL
to tap into the consumers’ emotions
• According to Brand team at EMEA, designs are based on hunch and they do
not use mood boards; designers seek inputs on designs instead of product
usage
– The design and innovation teams lack coordination to design in line
with the evolving taste of modern consumers
• According to TBL Global design team, the key challenge is to streamline the
design process to ensure thorough product testing and timely market launch
“The design team and the product that comes out...needs to outdo what we have done
before or is compelling to the consumer difference which forms the landscape of the pad on
which we sit. Unless we are offering something new and different, which aligns with VF, we
are not going to win.”
“So, we try to put mood-boards, from the mood-boards we try to share this with the
designers but …I don’t think I will see in their desk or in their office all the mood-boards that
speak to our specific consumer”
– Argu Secilmis, VP Brand (EMEA)

47
Existing Design Process at VF – Designers’ Needs
Designers have different needs across markets and brands at VF
• Design team at TNF US believes that it will be helpful if they
can have design targets for all product categories, including
the lower tiers
• The global design team at TBL thinks there is a need for
better collaboration between the designers and the consumer
research teams
– Consumer research teams need to aid the designers
about building a thorough understanding of the
consumer - how are they putting their day together, what
are they wearing, what are their unmet needs
• Currently, TBL APAC is in a replacement business, where the
demand is driven by needs rather than desires for the
product. The marketing team feels the need for aspirational
consumer profiles to enhance consumer engagement
– The team can use inspiration from 3-5 personas where
around 3 are dedicated to social outdoors and 2 that
help the team quantify the rest of the business
• TBL brand team at EMEA thinks that the designers at TNF
should try to relate with the consumers and think from their
perspective, e.g., designers at Adidas live the life of their
target consumers and are able to design better
• Designers state that the design target should be able to
give the aspirations of the bulk of their target consumer
base
– That person needs to be living the life they are
representing to the consumer. A design target should
be a person that other people can aspire to be,
somebody they want to be like
D E S I G N T A R G E T S F O R A L L
C A T E G O R I E S
A S P I R A T I O N A L D E S I G N
T A R G E T T O C A P T U R E ,
V A L I D A T E , A N D Q U A N T I F Y
V I E W S
3 - 5 A S P I R A T I O N A L
P E R S O N A S

48
Existing Design Process at VF – Preferred Formats to Receive Design Targets
Designers and marketers prefer to receive design targets in the form of videos, audios, or photos, as these enable them to
develop an emotional connect and understand the consumer better to design and innovate
VIDEOS AUDIOS PHOTOS VIDEOS VIDEOS PRODUCT STRATEGY
BRIEFS
MOBILE
APPS
“We are visual people, so anytime there is a story,
having photos or imagery, can at least convey what
is being said, is powerful…Like, imagery is strong
and that starts to paint a picture. If it’s just text on
a page or an email, it’s a good read, but it’s lacking
that emotional side and people get bored”
- Jason Israel, Design Director (US)
“If you can put the consumer in your pocket.
Timberland consumer in an app form. What kind of
content could be there - a day in the life, a video,
these are the Instagram feeds that this person is
following and they're real feeds - a way to step into
the shoes to witness the things that are informing
their lives”
- Christopher Pawlus, VP Global Product Design
and Creative Director
“It has to be a video we need to know who he/she
is, where they live, where they hang out, how many
friends do they have, are they the leader or the
follower. Essence is to really see who the person
is…to dress up a person head to toe, get to know
the person head to toe”
- Vivian Rivetti, VP Design (US)

49
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