Marketing research eddie bauer
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Eddie Bauer has experienced many ownership changes and strategic shifts since its founding in 1920. It filed for Chapter 11 bankruptcy in 2009. While known for its outdoor clothing, it struggled with frequent changes to its merchandising strategy that alienated core customers. Currently, it aims to revamp its image as rugged outdoor wear and regain customer trust through a return to basics.
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Marketing research eddie bauer
- 12. Distribution Channels Eddie Bauer is a complex organization with three core business and three channels apparel Apparel Home Outlet Retail Over 400 Stores Catalog 100M E-Commence www. eddiebauer .com www. eddiebauerhome .com www. eddiebaueroutlet .com
- 14. Competitive Analysis Eddie Bauer L.L. Bean Lands’ End The Gap Origin Founded 1920 Eddie Bauer Founded 1912 Leon Leonwood Bean Founded 1960 Gary Comer Founded 1969 Donald & Doris Fisher Products Sportswear, Outdoor Gear Outdoor gear & apparel Casual-style & Urban Chic Stores Worldwide 400 Few retail stores; 15 factory store outlets in Northeast 15 in US; products sold in 860 Sears stores in US 2009 Revenue FY ’10 $1.4 billion, down from $1.5 billion the year before $66.9m. Income rose 93% on a revenue increase of 7.3%. $14.2 billion Sales Channel On-line; catalogs, retail On-line; * catalogs; retail stores (mail out 200 million catalogs) * Catalogs; website; Sears Dept. stores; retail stores Website; Private Labels none none none Banana Republic Old Navy Target Market women & men; 30-54 years old income of $77,000. Upper/middle-class 50 percent men, Male/females 17-25 yrs. old; middle/ upper class; urban/ suburban; career oriented; active; all minorities
- 15. Decision Support System (DSS) Store Sales Data 2008 2007 2006 Retail and outlet stores sales: Retail store sales $443.9 $462.1 $455.4 Outlet store sales 158.1 140.6 104.1 Comparable store sales 602.0 602.7 559.5 Non-comparable store sales 95.1 108.7 140.6 Total retail and outlet store sales $697.1 $711.4 $700.1 Catolog and Internet sales 274.2 277.9 256.5 Other merchandise sales 0.0 0.0 0.1 Total merchandise sales $971.3 $989.4 $956.7 Shipping Revenues 34.0 34.2 34.0 Licensing revenues 12.8 13.8 15.7 Foreign Royalty revenues 5.0 6.3 6.6 Other revenues 0.3 0.6 0.4 Total Net sales and other revenues $1,023.4 $1,044.4 $1,013.4 Growth Rate (2.0%) 0.03 (4.3%) Net Income (Loss) ($165.5) ($101.7) ($211.9)
Editor's Notes
- Eddie Bauer, a multi-channel retailer who specializes in selling outerwear apparel and accessories for active outdoorsmen and women, operating more than 400 stores throughout North America, stores in Japan through joint ventures and 100 million catalogs and on-line websites, is looking to the future with a focus on the past. This 90-year-old retailer is struggling to find its niche in today’s marketplace all while trying to create a higher degree of differentiation from its competitors. In the past five years, Eddie Bauer has been all over the place trying to reinvent itself several times. After several failed attempts, the company emerged from a previous Chapter 11 protection 2005, after its previous owner, Spiegel Catalog and then again in June 17, 2009, Eddie Bauer filed for Chapter 11 bankruptcy protection. This evening our Team’s presentation will examine Eddie Bauer’s strategic situation and present an analysis of the company by describing their competencies in their value chain activities and an analysis of their competitive advantage. After reviewing critical areas of the business, we will present a few strategic recommendations, that if applied, would help them gain and maintain a competitive advantage well into the future.
- How do consumers view our company?
- What do we sell? What does our company/product mean? Applied Marketing Research (what a business need to address for a specific reason) It also licenses its name for furniture, luggage, paint, and Ford vehicles, eyewear, bicycles and as previously mentioned has stores in Japan through a joint venture.
- What do consumers desire?
- Strategic Marketing Management: 1-14 Identify and evaluate market opportunities Analyze market segments and select target market Plan and implement a marketing mix that provide value to customers and meet org. objectives Analyze firm performance. Once a strategy is executed, then a marketing mix and planned and implemented.
- 2008, ED stumbled and used trendy colors on classic clothes. Big Mistake. They got distracted and tried to reach too many segments. 70% of retail customers are women and women’s products are 45% of sales. When women’s business falters, the loss is two-fold because many women shop for men. Store customers are slightly younger on average than its catalog customers.
- Note: Finding the amount of monetary sacrifice that best represents the value customers perceive after various market constaints.
- Note: Effectiveness of advertising, premiums, coupons, sampling, discounts, public relations, and other sales promotions. What media alternatives are best suited to convey the intended message Customers used a special promotion code to receive discounted merchandise at 20% off. Finding: At the end of 1999, the website/catalog division enjoyed the most profitable year in the history of the business. Result: Made a significant change to business strategy and did away with the promotions Offer customers more than one way to buy their products from a web site, in retail stores and on the phone. ( At least one study says that customers of multichannel companies spend 30% more than customers of one-channel companies). Introduced a new outerwear line called "First Ascent " positioning itself as a premier outdoor and expedition outfitter.
- Note: Retail sites or warehouse locations in support of the distribution channel. The link between suppliers and customers. Outsourcing manuf plants – Eddie Bauer does not have any economies or diseconomies of scale. This is do to the fact that they are not in charge of their production process because it is handled overseas;
- Eddie Bauer has evolved from a single store in Seattle to a tri-channel, international company with more than 400 store, 100 million catalogs and online website which operate store in the U.S. and Canada, and through joint venture partnerships in Germany. These are the engines that drive the sales Catalog sales : EB primary marketing tool – reach new customers and generate direct sales, not available in stores. Sell merchandise through call centers Retail Sales: ED stores tend to be in mid- to up-scale regional malls. Sells premium merchandise E-Commence: is more of a marketing platform, not a distribution platform – one potential benefit: reduce the number of catalogs mailed and save cost of catalog production. Completely discontinuance of the catalog would result in savings of $75 million. Initial costs of production and print setup is expensive. Outlet Store: sells merchandise and inventory overstocks at value or clearance price points
- Note: External Analysis – Voice of the Customers - EB did an on-line open-ended survey in Feb. 2007. They wanted to get qualitative information from customers based on critical incident questions . This method involved more in-depth observation and elicited more participation by interviewees. Sample questions asked: Does the company still have cachet with consumers? Do we want Eddie Bauer to Live? Do we need Eddie to Live? Would we care if Eddie Bauer went out of business?
- The SWOT analysis provide an in-depth strategic analysis of the company’s businesses and operations to give you a clear and an unbiased view of the company’s key strengths and weaknesses and the potential opportunities and threats. Weakness: Moved to far away from its outdoor heritage and raised prices too aggressively. Supply chain concerns: Lowering overall supply chain costs and aligning supply chain & business strategy are notable objectives. This can be done through distribution network optimisation, reducing logistics/transport costs. Through efficient planning and forecasting tools, reducing waste and inefficiencies, and reducing inventory
- Note: Opportunities recognize problems and identify opportunities that would enrich and motivate actions that benefit both the customer and the firm. Threats: Competitors: Eddie Bauer has a large threat of rivals because there is such vast arrays of clothing stores that sell active wear. Eddie Bauer has 22 close competitors with GAP, Lands’ End and L.L. Bean being the top three. Their top competitors are not closely related to them when it comes to the number actual retail store locations, but they offer relatively the same catalog and online services. Suppliers: Eddie Bauer is highly threatened by suppliers because they do not own or manage any of their own manufacturing companies. All of their manufacturing plants are located overseas so Eddie Bauer has zero control over them. New Entry: Eddie Bauer has a definite threat of entry because they do not have a cost advantage over new entrants within its industry. Note: The one area that Eddie Bauer has some control over their suppliers is when it comes to being threatened by substitutes . There are several manufacturing firms that would be willing to produce Eddie Bauer’s products and do so while following their strict global labor practices EB is a valuable customer to their manufacturing firms.
- Under the pressure of the Chapter 11 status, good time to tweak its image – returning to its rugged roots. Enforcing the outdoors theme and using the original store’s sport shop logo on it’s catalog. Playing off more of its signature, ruggedness blue jeans, durability and value. They have also found that the knit and woven tops which are a perfect combination, is a marketing handle that marries up to their premium quality merchandise that is the spirit of EB sporting tradition of rugged casualty. Clothing better suited to appeal and fit its core customer, ages 30-54.An items that customers preferred over J. Crew and Lands’ end. The differentiator has to be overall quality and brand image, rather than price.
- Turn Around Strategy – After filing for bankruptcy, Eddie Bauer decided they needed to create a turnaround strategy that included reestablishing its strong customer relationships with their once loyal customers. They recently implemented a new customer-loyalty program called, Eddie Bauer Friends, which lets shoppers accrue points that can be redeemed for merchandise or other things. Eddie Bauer is getting back to the basics and has begun to sharpen its focus in the outerwear category. They are returning to their classic apparel after having taken its eye off its core customer in recent years. Expand global markets – The retail and consumer products industry is not thriving in 2010, but it is surviving in both Europe and North America. In addition, there are indicators of strong growth in Asia-Pacific, Africa and South America. EB already has a good strong presence in Germany and Japan Expand their market share in these markets is a good move for them. Backward Integration – Furthermore, in order for them to be able to lower their costs and have more control over their manufacturing we would like to see them perform a backward integration strategy. Consolidation strategy – B y merging with another company EB can get their products across a greater area without it costing a great deal of money. It also can help firms gain market share and increase firms’ product differentiation.
- If Eddie Bauer, went out of Business tomorrow, would it be missed? Conclusion: Eddie Bauer has seen better days. In recent years sales have been slow and it has lost relevance. It’s CEO abruptly quit and they’ve been in a turnaround phase for years now and recently rejected two buyout offers from private equity firms. Eddie Bauer, a once relevant retailer, leading in outdoor clothing, attempts to broaden it’s brand appeal, drifted into selling casual everyday wear and linen and things for the home. So back to the drawing board for Eddie Bauer.