Growth Strategy
Date: 2015-10-07; view: 511.
PRADA
TOD'S
| FEATURES | WEIGHT | ASSESMENT CRITERIA | ASSESMENT | ||||||
| Low (1-2) | Medium (3) | High (4-5) | |||||||
| Brand image | 30% | The brand doesn't add any value at the product | People are available to pay more for the brand | People don't take so much attention to the price | X | ||||
| Quality of goods | 20% | The product is made in developing countries | The product is made in Italy | The product is made in Italy with the best materials | X | ||||
| Comfort | 10% | The product is not confortable | The product has standard features | The product has some features that make it very confortable | X | ||||
| Assortment of goods | 15% | The company use the brand only for the original | The company sells diverse brands or different products | The company sells diverse brands and different products | X | ||||
| Strategy of selling | 10% | Less than 50 DOS | More than 50 DOS | More than 50 DOS with coverage of the main countries | X | ||||
| Skilled employees | 10% | Strong delocalization in developing countries | Presence of some facilities in the Italian district | Location of the main factory in an Italian district | X | ||||
| Sustainability | 5% | No attention to environment issues nor stakeholders | Attention to environment or to quality of life of stakeholders | Attention to both environment issues and to quality of life of stakeholders | X | ||||
| SUM | 45,5/50 |
| FEATURES | WEIGHT | ASSESMENT CRITERIA | ASSESMENT | ||||||
| Low (1-2) | Medium (3) | High (4-5) | |||||||
| Brand image | 30% | The brand doesn't add any value at the product | People are available to pay more for the brand | People don't take so much attention to the price | X | ||||
| Quality of goods | 20% | The product is made in developing countries | The product is made in Italy | The product is made in Italy with the best materials | X | ||||
| Comfort | 10% | The product is not confortable | The product has standard features | The product has some features that make it very confortable | X | ||||
| Assortment of goods | 15% | The company use the brand only for the original | The company sells diverse brands or different products | The company sells diverse brands and different products | X | ||||
| Strategy of selling | 10% | Less than 50 DOS | More than 50 DOS | More than 50 DOS with coverage of the main countries | X | ||||
| Skilled employees | 10% | Strong delocalization in developing countries | Presence of some facilities in the Italian district | Location of the main factory in an Italian district | X | ||||
| Sustainability | 5% | No attention to environment issues nor stakeholders | Attention to environment or to quality of life of stakeholders | Attention to both environment issues and to quality of life of stakeholders | X | ||||
| SUM | 47,5/50 |
According to the Ansoff's matrix, the Growth Strategy of Tod's in the Ukrainian market is a typical market development. In fact the Italian company should introduce in a new geographical area the same lines of products (just a few change in the assortments to match the specific needs and desirers of the typical Ukrainian customers should be implemented) it has in different countries.
In the specific, according to the result of the survey and the expert panel, platform, stiletto, and wellingtons represent the types of shoes preferred by Ukrainian customers. However, the most important models offered by Tod's are flats, kitten heels, mocassins, and pumps. For this reason, in case of a decision of entering in the Ukrainian markets, Tod's should modify its assortments. In particular, the main distinctive feature that represent a strength in the global market, that is the comfort, seems not to be the first characteristic requested by the Ukrainian customers.
Due to the fact Tod's represent a global recognized brand as a luxury shoes segment, the options in pricing strategy are very limited. In fact, even thought a reduction in price in the Ukrainian market could increment the volume of sales, and in the process, the total revenues and margin of the company, at the same time it could have negative fall out effects on different geographical markets, due the so called “banalization” phenomenon. The reason is connected to the fact that the main value of luxury brands is correlated to its exclusivity. However, in order to face the specific features of the Ukrainian market, Tod's should offer a well-defined assortment of less expensive shoes.
The results of the survey show that Ukrainian people dislike to buy shoes on the Internet, but prefer to purchase those product mainly in retailer shop (shops selling different brands) and branded shop (shops selling only their brands). In consideration that Tod's has a global strategy to provide its products by means of direct operating point of sales, and because the Ukrainian market is full of fake Italian shoes, we consider the opening of one or more DOS in the center of Kiev as the best strategy for Tod's. Infact, notwithstanding the higher costs associated with this distribution strategy, the fall out of the resulting image could improve sales in other geographical markets.
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