Faherty Surfs Down Under

Faherty Surfs Down Under 1

Capstone Initiative Faherty Surfs Down Under Kelly Murphy

FASM 430

Professor Grace Canepa

Faherty Surfs Down Under 2

Winter 2019

For my capstone initiative, I propose American clothing and Lifestyle brand, Faherty, enter into the Australian market by opening their first international storefront in Bondi, Sydney, November 2020.

My objective in Faherty Surfs Down Under is to expand internationally into a market in which the brand would thrive and the Faherty customer currently exists and create a digital marketing strategy to help aid in the success of this launch.

I chose Faherty based upon my admiration of their mission to create clothing for life’s great moments through the use of unique and sustainable fabrics, all while building a strong community through their consumers.

This initiative will include in-depth research regarding the Faherty Brand, identification of their strengths and weaknesses, their current target market, the global swimwear market as well as the Australian swimwear market, competitors and a digital marketing campaign.

Faherty Surfs Down Under 3

pexels.com

Contents Capstone Initiative / Pages 2–3 The Founders / Pages 6–7 The Faherty Journey / Pages 8-9 Target Market / Pages 10-11 Global Sports & Swimwear Market / Pages 12-15 Australian Sports & Swimwear Market / Pages 16-17 SWOT Analysis / Pages 18-19 Competitors / Pages 20-21 Unique Positioning / Pages 22-23 Target Consumer / Pages 24-25 Location Analysis / Pages 26-27 Product Assortment / Pages 28-29 Digital Marketing / Pages 30-39 Conclusion / Pages 40-41 Sources / Pages 42-43

Faherty Surfs Down Under 4

“Our life-long dream has been to create clothing for life's great moments, the ones spent by the water, around a bonfire, catching waves or watching sunrises. It's what makes the morning commute, the boss you don't like, and the pile of work on your desk not so bad. We're proud to design clothing made from unique and sustainable fabrics, and develop close, personal relationships with our manufacturers to craft high quality goods.”

–Mike & Alex Faherty

Faherty Surfs Down Under 5

pexels.com

The Founders In 2000, twin brothers Mike and Alex Faherty were posed with the challenge of writing their college essays. Mike wrote his essay about starting a clothing company with Alex – Alex wrote his essay about the Spring Lake ice cream man.

Flash forward to 2005, Mike begins working in design at Ralph Lauren RRL while Alex starts work in finance and business strategy in Private Equity. In 2012, Mike left Ralph Lauren to spend half the year traveling the world to find inspiration for textiles and prints. The second half of the year was spent working to perfect designs and fabrics for the first Faherty collection.¹ In 2013, Mike’s dream of starting a clothing company with Alex becomes a reality as the brothers launch their first collection of sustainable swim wear for men and women. Thus, the Faherty brand was born.

¹ (fahertybrand.com, 2019)

Faherty Surfs Down Under 6

Mike Faherty

Alex Faherty

Faherty Surfs Down Under 7

@fahertybrand

The Faherty Journey

2012 Mike leaves RLL to travel the world for inspiration for prints & textiles, then perfects designs for 1st Faherty collection

2013 Alex leaves his job & the brothers launch Faherty with men’s & women’s sustainable swimwear.

Faherty “beach house on wheels” is born.

²(fahertybrand.com, 2019)

Faherty Surfs Down Under 8

2014 Faherty SoHo opens in NYC as its first brickand-mortar store

2016 New Faherty storefronts in Nantucket, Malibu, Newport Beach, and Bleecker (NY) open up.

2019

2017 Faherty Boston opens and the HQ moves from SoHo to Tribeca.

Faherty Surfs Down Under 9

The Faherty brand continues to grow & plans 2 new California storefronts to open in February & March²

@fahertybrand

“If you’re in the area, swing by and say hi. It’s our customers and community that give this brand life.”

–Mike & Alex Faherty

Faherty Surfs Down Under 10

Target Market Gender : Men & Women Age Range : Late 20s–30s Location : East Coast/West Coast Income Level : $75k-135k/year Education : College Educated Religious Beliefs : Spiritual Marital Status : In a relationship/single Attitudes : Conscientious, Hard-worker, Easy-going, Clear path in life, Optimistic Values : family, loyalty, close relationships Lifestyle : Work hard - play hard,

loves to relax at the beach after a long work week Interests : surfing, swim, adventure seeker VALS Segments : Experiencers, Achievers

Faherty Surfs Down Under 11

pexels.com

Global Sports & Swimwear Market Globally, we see a rise in the popularity of athleisurewear among consumers.

This, in part, could be attributed to trends that have seen a steady increase in popularity including the practice of a healthy lifestyle and an awareness of sustainability. Similarly, these trends have been reflected in the rise of sports and swimwear as a result, as these categories account for 3% of the total apparel market.³ In correlation to the rising healthy lifestyle trend, Statista reported that the worldwide sports and swimwear revenues increased by 4% between 2016 and 2017. Further support of the market include the recognition of Sports and Swimwear sales increasing by 4.0 in comparison to 2016, and reaching US $48 billion and 5 billion pieces.⁴

Figure 1

³ (Statista Consumer Market Outlook, 2018) ⁴ (Statista Consumer Market Outlook, 2018) Faherty Surfs Down Under 12

Figure 2

Faherty Surfs Down Under 13

A study conducted by Allied Market Research for Statista estimated that the swimwear market is projected to increase in value worldwide from 2017 to 2024, as depicted on the chart in figure 3.â ľ This further supports the growing active lifestyle trend and figure 4 identifies the countries spending the most revenue per capita for the sports and swimwear market.

Figure 3 â ľ (Allied Market Research, 2018)

Faherty Surfs Down Under 14

Figure 4

Faherty Surfs Down Under 15

Australian Sports & Swimwear Market Analysis In the broad view of retail in Australia, we see an annual retail turnover that has been gradually rising since 2004, as depicted in the chart in figure 5.⁶ Australia is notorious for its vast beach and swimwear market. Locals and toursits alike utilize the close proximity to the ocean and take advantage of an active lifestyle by dressing properly for either swimming, surfing, or lounging on the beach. According to Statista, Australia is projected to see exponential growth in the sports and swimwear volume sales, based upon the 1.4% increase between 2016 and 2017, as seen in figure 7. Australia also places within the top ten countries in which the revenue of sports and swimwear is highest, as seen in figure 6.⁷

Figure 5

⁶ (Australian Bureau of Statistics, 2018) ⁷ (Statista Consumer Market Outlook, 2018) Faherty Surfs Down Under 16

Figure 6

Figure 7

Faherty Surfs Down Under 17

@fahertybrand

Faherty Surfs Down Under 18

SWOT Analysis

S

Compelling and diverse product assortment Sustainable mission Close relationship with manufacturers Creation of community through target market

W

Higher price points Fewer physical storefronts Little advertising when compared to competitors

O

Cornering sustainable beachwear market Expansion into global market Expansion of product offering

T

Sustainable competitors offering wider product assortments Lack of brand awareness Global awareness of competitors

Faherty Surfs Down Under 19

Competitors As Faherty is an American brand, their competition must be viewed through an international lens. In terms of international renown and similarity to Faherty Brand itself, Tommy Bahama, Billabong, and Patagonia all have physical storefronts in Australia, and Sydney specifically, as well as ability to ship globally. In terms of a niche market that consists of a close community, Chubbies is similar to the ethos of Faherty and also ships globally. Outerknown is competition to Faherty in that it champions sustainability and ships globally.

Billabong is a competitor to Faherty in that they are a widely known brand, offering men’s, women’s and children’s swimwear and beachwear. The familiarity of the brand is the strongest threat to Faherty in terms of competition, especially as this is a global brand.

Tommy Bahama, though targeting a slightly older demographic than Faherty, still acts as one of Faherty’s top competitors due to their product assortment and high quality. The Tommy Bahama lifestyle echoes similarly to that of Faherty brand in their mission statement of being “committed to extending the relaxed, positive vibe of our brand into philanthropic efforts.” Tommy Bahama also offer products to men, women, and children just as Faherty does.

Faherty Surfs Down Under 20

Though Patagonia offers a wider product assortment beyond beachwear, the brand still acts as a competitor to Faherty in terms of their sustainability factor. Both Patagonia and Faherty are dedicated to producing the highest quality of product, using sustainable manufacturers and fabrics. Patagonia is stronger in their environmental efforts and have more capital to devote to sustainability. Both brands share similar price points for their product.

Patagonia is also more globally known.

Outerknown is a sustainable company that offers more than just swimwear so it poses as a threat to Faherty in the sustainability realm. They offer both men’s and women’s clothing and share a price point similar to Faherty. They also hold a unique position in that they target a smaller, niche market, just as Faherty does.

Chubbies poses as a top tier competitor to Faherty in terms of the niche market they target and product similarity in terms of their selection of swimwear for men and women. Like Faherty, Chubbies believes in creating a community in their target market and treats each customer like they’re part of the club.

When one shops at Chubbies, they receive a personalized experience and really enjoy the personality of the brand.

Faherty Surfs Down Under 21

Unique Positioning Faherty has a unique place in the beachwear market in that they have developed close, personal relationships with their manufacturers to craft high quality goods made from unique and sustainable fabrics.

They pride themselves on making quality product made for the beach and for the times you wish you were at the beach. The brand also emphasizes the importance of connecting with their consumers and creating a Faherty family community. The brand’s mission, product offering, and domination of a sustainable niche market places them higher up on the beach and swimwear market scale.

Faherty Surfs Down Under 22

Faherty Surfs Down Under 23

@fahertybrand

@owright

Faherty Surfs Down Under 24

Target Consumer Based upon Faherty’s current target market, the Australian target consumer falls within a similar psychographic and demographic, with slight deviation of a higher income level and stronger family connection, based upon primary research of observation and analysis through my time in Bondi and talking with locals.

The Faherty target consumer exists within 35-year-old Liam Parks. Liam was born and raised in the Bondi area and is now raising a family of his own with his wife Lena and their 3 year-old-son, Elliot. A former pro-surfer, Parks is now CEO his family’s business, running a chain of surf shops along the New South Wales coast. Combined with income he continues to make promoting surf gear, his yearly income comes in around $140k AUD. Parks believes in the work hard, play hard method and enjoys spending his free time relaxing with his family and spending time outdoors. His style is easy-going and relaxed and when he isn’t in the water in board shorts, Parks can be found lounging in beachwear. Faherty is perfect for a consumer like Liam Parks because his values and beliefs align with the Faherty brand and Faherty’s beach and swimwear would resonate well with his casual style.

Faherty Surfs Down Under 25

Bondi, Sydney, New South Wales, Australia pexels.com

Faherty Surfs Down Under 26

Location Analysis After conducting primary research of having visited Bondi and observed the environment, I found it to be the ideal location for Faherty to expand into based upon several factors. Bondi itself is a beach town suburb, located on the coast of New South Wales, and has several beaches that are famous for surfing. As Faherty was founded upon Mike and Alex’s love of surfing and the desire to create swim and beachwear that was visually appealing as well as high quality, Bondi’s surf positive culture adheres well to the brand mission.

Bondi is also very progressive in terms of sustainability. In 2015, Bondi Beach in New South Wales was presented with the Environmental Sustainability award, won at the Keep Australia Beautiful, Australian Clean Beaches Awards.

This aligns with Faherty’s sustainable mission and product offering.⁸ There are a few beach and swimwear retailers already present in the Bondi area, however, majority of the stores predominantly target women. Faherty has a huge opportunity here to reach out to the target market of men and would be one of the few American brands present in the Bondi market, which could be a huge plus for the brand.

As Bondi is also a relatively small suburb, Faherty would have the opportunity to create a community of their target market in Bondi, as they do with their current storefronts in the US.

⁸ (Alice Morgan, 2015)

Faherty Surfs Down Under 27

Product Assortment In terms of the product assortment for the Faherty Bondi storefront, I believe Faherty would be most successful to follow their current product assortment model utilized in their US storefronts; incorporating men’s, women’s, and children’s beach and swimwear.

I propose a slight deviation to the assortment in that I believe Faherty should provide more product targeted to men, as this target market is currently neglected in Bondi and I believe Faherty has a perfect opportunity to reach them. I believe the assortment should also speak more to swimwear and the beach, loungewear the Faherty offers.

Faherty Surfs Down Under 28

“Growing up surfing in a beach town, we couldn’t find high quality clothing that reflected our casual lifestyle. After many years of weeding through surf shop clothing racks while admiring our dad’s tailored Italian suits and vintage Hawaiian shirts, we decided to someday start our own clothing brand and the idea stuck.”

–Mike & Alex Faherty

Faherty Surfs Down Under 29

@fahertybrand

Digital Marketing In the digital marketing realm, Faherty has a strong digital presence, currently possesses the key social media outlets relevant in present-day society including, Instagram, Facebook, and Pinterest. They utilize these outlets to strategically push digital marketing campaigns announcing new product or campaign launches.

In addition to selling from their website, fahertybrand.com, the brand also has select product featured on Amazon. I found that after frequent visitation of a combination of the Faherty website, social medias, and Amazon search, I began to receive targeted Faherty digital marketing content on my Internet browser’s home page (yahoo.com), as well as on Facebook paid ads. Faherty Brand also sends out email blasts, however, the frequency of these ads is less so.

Faherty Surfs Down Under 30

Faherty Surfs Down Under 31

Digital Marketing Strategy In order to raise awareness of Faherty’s expansion into Australia, I propose to create a digital marketing campaign directed towards the Bondi market. This includes utilizing the current social platforms of Instagram and Facebook and digital strategies that Faherty Brand currently has in place of email blasts and paid ads. I would also recommend Faherty place more product on Amazon. com.au, to help promote brand awareness and allow for easy accessibility once the Bondi storefront is open.

Realizing the target market in Australia will likely not know about Faherty or randomly happen upon these digital marketing materials, I propose to contact varying surf shops and schools in the Bondi area and request their email subscription lists, in return for recommendations to their business once the storefront is open. Examples of such surf shops include Bondi Surf Co, Disrupt Sports, Lets Go Surfing, and Surf Culture. These surf shops primarily sell surfboards and surfing gear and therefore would not be direct competition to Faherty.

With the surf shop email subscription list, I will create an email introducing the Faherty Brand and announce the opening of their Bondi storefront November 2020. This will follow a similar format to the welcome emails Faherty initially sends out when a customer subscribes to the Faherty Brand emails and alerts.

Additionally, as the storefront is under construction, I plan on placing a QR code on the window of the Faherty store so the curious passerby can scan the code and be directed back to the Faherty Brand website, in order to learn more about the brand and product offering. According to a student by Juniper Research, it was estimated that QR coupons redeemed via mobile will reach 5.3 billion by 2022, in comparison to 1.3 billion in 2017. That being said QR codes have proven to be hugely successful globally as of recent years in the pushing targeted traffic after initial engagement with users.â š In conducting primary research, I observed QR codes present in Australia and took notice that consumers often interacted with them via scanning with a mobile device. â š (Cecile Amalfi, 2018)

Faherty Surfs Down Under 32

To further bring awareness to the Faherty Surf Down Under expansion, I plan on contacting influencers relevant to the Australian market. My choice of influencers include Aussie pro surfers Stephanie Gilmore and Owen Wright, as both surfers are highly popular on Instagram and have previously partnered with brands in the past. Rather than pose Faherty as competition to major surf brands like Rip Curl and Billabong, Faherty would approach as a lifestyle brand for surfers on their more casual surf days, when they want to relax on the beach with friends and family in comfortable and stylish Faherty beach and swimwear.

As a six-time world champion on the Women’s ASP World Tour and 618.4k Instagram followers, Stephanie Gilmore is the perfect female influencer as she resonates with Faherty’s female following.

Owen Wright held 20 Championship Tour heat wins as of 2017 and earned himself #5 on the CT rank list for 2017.

With a sibling also in the pro surfing scene and a growing family, Wright is ideal for the male target market as a family oriented surfer. He currently has a strong Instagram following of 395.3k.

Faherty Surfs Down Under 33

Digital Marketing Content

For my Facebook marketing account, I plan on posting the imagery that is to be associated with the Australian expansion and announce that Faherty is opening up shop in Bondi. I also plan on using paid ads to feature Faherty and direct viewers to the Faherty website and Amazon.com.au.

Faherty Surfs Down Under 34

LEARN ABOUT BONDI

Introducing Faherty Brand Bondi We’re excited to announce our first international expansion to Bondi, Sydney, NSW, Australia Expected opening November 2020. Stay tuned for updates on our Australian adventure!

In terms of the email blast that will be sent, drawing from the local Bondi surf shops’ subscription lists, I plan on keeping the imagery consistent with the marketing content imagery associated with the expansion. I also plan on writing a welcome and giving the details of the Bondi store, in addition to the brief history Faherty currently has on their welcome emails. I will also maintain the discount code on the email, to encourage Faherty first-timers to buy product from the Faherty site before the physical store opening in the hopes that if they buy it and like it, they’ll visit the store when it opens.

Faherty Surfs Down Under 35

Digital Marketing Content

Faherty Surfs Down Under 36

For the Instagram digital marketing content, I plan on maintaining that consistency across this global expansion campaign by again using the same imagery and simply varying the copy slightly for each individual post itself.

Faherty Surfs Down Under 37

Digital Marketing Content

For the influencer posts, I plan on having each influencer post a picture involving Faherty product, with copy to support how excited they are about the Bondi Faherty store and encouraging followers to check it out @fahertybrand.

Faherty Surfs Down Under 38

The QR code to be posted on the window of the Faherty Bondi store while under construction will simply include the code, Faherty logo, and instruction on what to do with the code.

Scan this QR code with your smart phone to learn more about Faherty Brand

Faherty Surfs Down Under 39

Conclusion In summary, I believe Faherty Surfs Down Under would be a successful initiative due to the excess of evidence supporting the global rise of the swimwear market, especially in Australia. Bondi, Sydney, makes for the perfect location for Faherty to expand into due to both proximity to the beach, sustainability efforts, and the presence of a target market similar to that of Faherty. My digital marketing strategy would prove successful in that it is similar to what Faherty currently executes. My digital marketing strategy would also raise awareness of Faherty entering into a new market with the assistance of Australian surf influencers and the surf shop email subscription lists to really target the market Faherty would want to reach.

Faherty Surfs Down Under 40

Faherty Surfs Down Under 41

@fahertybrand

Sources “2018 Could Finally Be The Year For QR Codes.” Digital Operative, 31 Aug. 2018, www.digitaloperative.com/ blog/2018/2018-could-finally-be-the-year-for-qr-codes/.

Allied Market Research. “Swimwear Market Value Worldwide from 2017 to 2024 (in Billion U.S. Dollars).”

Statista - The Statistics Portal, Statista, www.statista.com/statistics/874093/swimwear-marketvalue-worldwide/, Accessed 26 Feb 2019 Australian Bureau of Statistics. “Annual Retail Turnover in South Australia from 2004 to 2017 (in Billion Australian Dollars).” Statista - The Statistics Portal, Statista, www.statista.com/statistics/653711/ australia-annual-retail-turnover-sa/, Accessed 26 Feb 2019 Callan, Paris Donnatella. “The 10 Best Australian Surfers.” Culture Trip, 11 Oct. 2017, theculturetrip.com/ pacific/australia/articles/the-10-best-australian-surfers/.

“Faherty Brand (Fahertybrand).” Pinterest, Pinterest, 2019, www.pinterest.com/fahertybrand/.

“Faherty Brand.” 2019, www.facebook.com/FahertyBrand/.

“FAHERTY (@Fahertybrand) • Instagram Photos and Videos.” Instagram, www.instagram.com/ fahertybrand/?hl=en.

“Faherty+Brand.” Amazon, Amazon, 2019, www.amazon.com/s?k=faherty%2Bbrand&ref=nb_sb_noss_2.

Media Genesis. “The Rise of QR Codes in 2018 » Media Genesis.” Media Genesis, Media Genesis, 11 Oct.

2018, mediag.com/blog/the-rise-and-fall-and-rise-again-of-qr-codes/.

Morgan, Alice. “Bondi Beach Win Environmental Sustainability.” Keep Australia Beautiful, 15 Aug. 2015, kab.org.au/bondi-beach-win-environmental-sustainability/.

“Our Story.” Faherty Brand, 2019, fahertybrand.com/pages/our-story.

Statista Consumer Market Outlook “ Apparel Report 2018 - Sports & Swimwear” Statista, 2018, https://0 www.statista.com.library.scad.edu/study/48858/apparel-report-sports-and-swimwear/ Statista. “Revenue of The Sports & Swimwear Market Worldwide by Country in 2018 (in Million U.S. Dollars).”

Statista - The Statistics Portal, Statista, www.statista.com/forecasts/758630/revenue-of-the-sportsand-swimwear-market-worldwide-by-country, Accessed 26 Feb 2019

Faherty Surfs Down Under 42

Faherty Surfs Down Under 43

pexels.com

Faherty Surfs Down Under 44