BRAND ANALYSIS by Anamaya K

NOTTINGHAM TRENT UNIVERSITY

BRAND

ANALYSIS AND OPPORTUNITY REPORT

15.02.2021

BY ANN KENDI KINOTI

WORDS: 4027 N0948597

CONTENTS

GLOSSARY

BACKGROUND

SWOT ANALYSIS

OPPORTUNITY REPORT

ABSTRACT

BRAND ANALYSIS

PROBLEM/ OPPORTUNITY IDENDIFICATION

MARKETING STRATEGY

MEET THE INFLUENCERS

CONCLUSION

REFERENCES AND BIBLIOGRAPHY

GLOSSARY

People: In the marketing mix, people refer to the persons and teams that work or are involved in a business at various levels and places. According to (People 2017), people in the marketing mix are currently one of the most important elements for products as well as services, as they contribute to both. Policies and plans that a business puts in place need people to implement them. At Victoria’s Secret, employees are expected to be drive business value through superior customer service.

Place: In the marketing mix, place refers to the point from where customer gets access to a product. It has also been referred to as the process of moving products from the producer to the intended user (Luenendonk 2019).

Price: Price is an important component of the marketing mix. A product must be understood to be priced. According to (Britannica, n.d.), price is the amount of money or consideration that has to be paid to acquire a given product. Price is also a measure of value if people are ready and willing to pay the amount for the product and by extension the brand.

Product: Kotler & Keller (2016, p. G7) define a product as “anything that can be offered to a market with the aim of satisfying a want or a need, including physical goods, services, experiences, events, persons, places, properties, organizations, information and ideas”.

Promotion: In marketing, promotion refers to any type of marketing communication used to inform target audiences of the relative merits of a product, service, brand or issue, most of the time is persuasive in nature (Promotion n.d.).

TCARTSBA

Victoria’s Secret is a leading American women intimate wear and beauty products dealer. The company is better known for high visibility marketing and branding. This report analysis Victoria’s Secret brand using the 5 Ps of marketing mix as a guide. It also examines the competitive environment forces in the international fashion business. In addition, the macro and micro environment factors have been evaluated and assessed to determine their impact on the international fashion business and brand. A SWOT analysis done on Victoria’s Secret show that the company has many opportunities it can capitalize on for its success. An opportunity report highlights Victoria’s Secret brand media marketing plan to introduce diversity and inclusivity as well as new product lines for the success of the business and brand. Key words: branding; marketing mix; competitive environment factors; macro & micro; SWOT analysis.

Background

Victoria's Secret is an American international lingerie clothing and beauty retailer known better for high visibility marketing and branding (Victoria’s Secret n.d.). Victoria’s Secret has a huge online presence and has built a strong brand image. According to the American Marketing Association (Branding n.d.) a brand is a name, term, design, symbol or any other feature that identifies one seller's goods or service as distinct from those of other sellers. Victoria’s Secret was established in 1977 by American businessman Roy Raymond (The development 2021). Starting 2008, Victoria's Secret expanded internationally with companyowned stores throughout Canada and the UK ((Victoria’s Secret n.d.). Between 2016 and 2018, its market shares in the US dropped form a high of 33% to 24% (Hanbury 2019). This was fueled by the shoppers’ shifting preferences and the company’s slowness in noticing and reacting to changing fashion trends.

The company has been criticized for promoting unrealistic ideals of beauty through their runways and brand models. Recently, Victoria’s Secret has tried to embrace inclusivity with its new spring 2020 campaign, ‘Body by Victoria’. The new line showcases trans, plus size and older models. In September 2020, L Brands announced a partnership with Next PLC for Victoria’s Secret UK business. Under the agreement, Next PLC of UK owns 51 percent of the new joint venture and Victoria’s Secret 49 percent. This deal is expected to result in profit improvement for Victoria’s Secret UK business, help it expand its brand as well as stores and online presence both in the UK and Ireland. This brand analysis report is guided by the 5Ps of the marketing mix. Secondary research of macro and micro environments in international fashion businesses are explored. A SWOT analysis on Victoria’s Secret as a brand as well as their competitor highlights the opportunities the company can exploit. An example is an opportunity report on a brand media marketing plan that emphasizes on the importance of embracing diversity and inclusivity to introduce a new product lines and expand business.

INTRODUCTION

Brand Analysis In order to get a deeper understanding of the Victoria’s Secret brand, it is analyzed through the lenses of the key 5 Ps of marketing mix or strategy; Product, Price, Place, Promotion and People.

The 5 P's

Product

Victoria’s Secret family of products include; the primary brand of feminine lingerie articles, beauty and skin care products, sleepwear, sportswear, and accessories. From its product catalog (Product catalog n.d.), the brand sells over 100 specific products from its main divisions, namely: Victoria’s Secret Lingerie, Victoria’s Secret Beauty and Pink.

Price

Price: Victoria’s Secret brand has a range of prices for their products depending on the items. Often, companies have to review and adjust the prices for their products as a response to the prevailing market circumstances.

LOW

MID

GOING HIGHER

Place Place: Victoria’s Secret offers its products mainly from physical and online stores. In 2020 it was in 1,070 physical locations and at the beginning of 2021 in 775 locations around the world (Victoria’s Secret n.d.); this decrease of the physical stores was due to the COVID-19 pandemic and the ever changing consumer patterns. Victoria’s Secrets owned physical stores are typically large, ambient, conveniently located in selected countries in the world such as United States, Canada and Europe. They offer a conducive shopping environment to the customers.

Promotion Promotion: Victoria’s Secret uses an integrated marketing communication strategy to promote and increase its brand awareness, enhance brand reputation and deal with competitors. The brand also has IGTV videos on Instagram that teach their consumers on how to measure themselves so as to achieve the perfect bra fit for their orders. They go as far as posting videos of the lingerie line design process, leaving the consumer feeling involved and included in the entire experience. A look at the Victoria’s Secret online stores shows that the brand has been offering massive discounts on their family of products including lingerie articles, sleepwear, skincare and beauty products. For instance, their slight price reduction on the PINK label whose target market are the younger consumers.

People People: Victoria’s Secret consumer has changed throughout the years as it was first founded to appeal to mean who were shopping for women lingerie. The target consumer has now shifted to women after a complete brand revamp when Lex Wexnes took over. They have a wide range of female consumers; this is due to their wide range of products. The age group varies from 16-24 years for the PINK line targeted at the younger consumers. There’s also the consumer aged 25-50 years, who would be interested in their lingerie products and cosmetics such as fragrances and body lotions. Being a luxury brand the products are often only affordable to the upper middle classed and high income consumer groups. It is safe to say the majority of the consumers are restricted to the Western countries considering the location of the physical stores.

Competitive Environment Analysis

potential entrants

supplier INDUSTRY power RIVALRY

buyer power

substitutes

Porter’s five forces (Porter’s 5 forces n.d)

Victoria’s Secret brand operates in a well-established fashion and beauty industry. It targets customers that are mainly made up of girls and women aged 13-50 years with their wide range of premium women lingerie, fashion and beauty products. This puts the company in competition with stores such as SavageXFenty, Aerie, Lively, Target, True & Co., Third Love, Calvin Klein, Adore me, American eagle outfitters and Nordstrom (Victoria’s Secret competitors n.d.) The competitive environment in which these businesses operate can be analyzed by using the Michael Porters Five Forces of Industry Competition Model (Porter’s 5 forces n.d.).

Industry rivalry-rivalry among competitors Currently, the rivalry between the competitors in the fashion and beauty industry, and more specifically in women lingerie and beauty products where Victoria’s Secrets operate, is high. This is because of the many active players in the industry who are competing for the same customers and offering similar or undifferentiated substitute products at similar or lower prices. Going into the future the rivalry is expected to remain high.

Threat of new entrants Consumer needs and preferences in the fashion and beauty industry are constantly changing and most consumers no longer have high loyalty for existing brands. Presently, the demand for products this industry offers are increasing. With the liberalized global economies and ever changing consumer beliefs for more inclusive and diverse products; the threat of new entrants into the fashion and beauty industry is high. For instance, Aerie. One of Victoria’s Secret competitor; an intimate and stylized apparel and lifestyle retailer owned by American Eagle Outfit has no age demographic and encourages all consumer types to shop at Aerie. 6 years ago they launched its #Aerie REAL campaign. A bold campaign to stop photo-editing pictures of its models. The brand ambassadors that were selected were known as ‘Role Models’, representing social causes that impact women in their daily lives. They not only represent a line of diverse background but also the disabled community. This is a matter most fashion brands have failed to address.

Threat of substitutes Though they are not direct competitors, there are currently many products in the fashion and beauty industry that fulfil the same or similar underlying customer needs as those from the established businesses such as Victoria’s Secret. The existence of these substitute products such as women lingerie and beauty items give the customer alternatives or options, although they are branded differently. Due to their availability and affordability, the customers are ready and willing to switch to them. For instance, ALDI plans to launch a lounge wear line that consists of yoga bras that cost no more than £6 pounds; yet a similar item in Victoria’s Secret costs £17 pounds a discounted amount from £35 pounds.

Customer bargaining power The retailers and end-users constitute the majority of buyers of the fashion and beauty product. These buyers are many and they also have alternative sources from where they can buy their products in the quantities and format that they want. In the international fashion business, the internet has enabled buyers to be more exposed, informed and hence more empowered. They easily and go on-line and compare alternative products from various companies based on prices, quality as well delivery convenience. Because most buyers purchase products in low quantities, their purchasing power can be considered to be currently medium and poised to be so into the future.

Supplier bargaining power The bargaining power of the supplier will depend on their ability to control prices and quality of the purchased good and products. Businesses in the international fashion industry have multiple suppliers to choose from. However, some supplier products may be unique and differentiated and hence the cost of switching from one supplier to another might be high. This means therefore, that the bargaining power of suppliers in the international fashion and beauty industry is currently medium. This force can be expected to remain medium in the long run.

Summary of Porter’s 5 forces in the fashion and beauty industry

Summary of Porter’s 5 force. Source: Author

MACRO ENVIRONMENT ANALYSIS Several macro and micro environment factors can affect how a company operates and even the value of its brand particularly with regard to international fashion businesses and especially a brand such as Victoria’s Secret.

Macro environment factors These are the general external environmental factors that can influence decision making in business organizations, but businesses cannot control them. Using the PESTLE (Political, Economic, Social, Technological, Legal Environmental/Ethical)) framework, the general external environmental factors affecting/impacting the international fashion business and brands can be analyzed, thus: Political- Political factors include government policies and regulations governing taxes, foreign trade policies, competition, political stability of a country and the level of corruption. Increases in taxes or changes in international trade policies and regulations will be negatively impact international fashion businesses because of increased input costs leading to low business profits. Economic- These factors include: the currency value; inflation, exchange and interest rates; economic growth rate; recession; unemployment rate; country’s gross domestic product (GDP), and consumers’ disposable income/spending power. The currency values and exchange rate have a serious economic impact on a business. With high GDP and low unemployment, consumers have high disposable incomes and more spending power to the benefit of businesses.

Social- Social factors include: o Changes in consumer trends- styles, choices, tastes and buying behaviour. o Demographics. o Community, pressure groups and activists. Businesses must identify changes in the social factors and take appropriate action to maximize on them for their success. They should also be aware that community and pressure groups including activists can influence consumers positively or negatively about their products and brand. Technological - Technological factors include: o Rapid technological advancements / innovations- including Artificial Intelligence (IA), Big Data and Robotics. o Improvements in production and manufacturing technologies. Undoubtedly, technology has the potential of increasing business efficiency in production and service delivery. International fashion businesses that are slow to embrace technological advances and innovations in their operations, it risk losing business to competitors or becoming irrelevant. Legal- Legal factors include: o Laws governing employment, wages and taxation. o Health and safety regulations. o Consumer protection laws. These factors have major effects on a business working environment. For instance; changes in employment and minimum wage laws with an increase in labour costs will affect the operating expenses and consequently impact negatively on the business profits.

Environmental/Ethical- These factors mostly relate to: o Environmental protection policies, laws and regulations. o Environmental pollution. o Sustainability. International fashion businesses and brands have the responsibility of protecting the environment in the countries where they operate. Any business bleaching laws relating to environmental protection or ethical practices, risks heavy penalties with detrimental effects on its finances, operations and brand.

MICRO ENVIRONMENT ANALYSIS

The micro environment factors are those closely associated with the operation of a business and influences its functioning on a daily basis (Chavan 2018). With particular reference to international fashion business and brands, these factors include: customers, employees, competitors, suppliers, retailers & distributors, and the media. Although a business may not always be able to control these factors, it should nevertheless endeavour to manage them.

Micro factors Customers- Customers are vital to a business. Without paying customers companies cannot be in business. International fashion businesses and brand such as Victoria’s Secret should be able to anticipate and quickly respond to their customer needs lest they lose them to their competitors, an eventuality that will have negative impact on the company’s finances. Employees- Employees are expected to drive the business value through quality customer service. For a fashion business like Victoria’s Secret, they are the vital link between the brand and customers. Businesses risk losing their competitive edge if they don't endeavour to recruit, train, develop and retain skilled, competent and talented employees. Competitors- Business competitors influence the action of their rivals. This is because competitors typically target the same customers, markets, distribution channels and even employees. Poor management of the competition by the international fashion businesses and brand can lead to complete loss of business.

Suppliers- Suppliers provide businesses with vital good and services. For the international fashion businesses, they supply raw materials that are transformed into value added finished fashion products. The supplier’s actions and behaviour will impact the business directly. Poor service by suppliers might cause delays in delivery times and product quality. Also, an increase in the price of raw materials from the suppliers can lead to an increase in the product selling price, resulting into the business being non-competitive in the global market. Retailers & distributors- International fashion businesses such as Victoria’s Secret rely on retailers and distributors to take their products to the consumers. Selecting and retaining the best retailers and distributors will have a positive impact on the finances of the business. Media- The type of media attention a business or brand gets has great impact on the organization’s success or failure. Negative media publicity can easily kill a brand reputation, credibility and value. It can also change the perception and interest of customers in the business’s product, thus affecting sales volumes.

SWOT ANALYSIS: VICTORIA’S SECRET

In order to assess the potential gaps between the internal Strengths and Weaknesses and the external Opportunities and Threats of Victoria’s Secret business model, a SWOT analysis was carried through the use of secondary research. The highlights are as follows:

Strengths • Strong brand presence and recognition • A variety of quality products • Strong media presence including options for stores or on-line shopping • Well established in the USA

Opportunities • Embrace inclusivity and diversity by expanding the Victoria’s Secret brand into the disabled, gender fluid and plus-sized market • Attract more customers with appropriate marketing advertising and promotional programs involving a diverse group of influencers • Make more strategic acquisitions/partnerships

Weakness • Limited attire sizes • Lack of brand promotions with model of different backgrounds, ethnicity, beliefs and disabilities • High brand marketing expenses • Weak international presence

Threats • Emerging brands • Counterfeits and cheaper substitute products • Price volatility and seasonality of business • Rising labour and production costs • Bad publicity

PROBLEM IDENTIFICATION /OPPORTUNITY From analysis, Victoria’s Secret business has lost many customers to competitors, mainly due to its sluggishness in responding to fast changing consumer fashion trends, preferences taste and styles. The company has been accused of lacking inclusivity and diversity in the models used for promotional images, and it ought to include more of healthy bodies of different types, shapes and sizes as well as individuals with disability, different ethnicity, age and cultural beliefs. Due to negative publicity, its brand image, its credibility, value and reputation has suffered. The company’s market share has reduced, and so has its business profits. The problem is; how can Victoria’s Secret regain its past glory as well as its market leadership position and continue thriving positively? One way is by exploiting the business opportunities at its disposal. For instance, in the UK Victoria’s Secret has taken a bold move to enter into partnership with NEXT PLC so as to save its faltering business in the UK from collapse. In the next section, the author presents an opportunity report on; “Victoria’s NEXT Secret”: Brand Media Marketing Plan

Victoria’s NEXT Secret: BRAND MEDIA MARKETING PLAN

EXECUTIVE SUMMARY

Victoria’s Secret is a leading international fashion business and brand that focuses mostly on the sale of women lingerie and beauty products. In recent times and more so during this covid-19 period, the company has experienced a marked decline in sales partly due sluggish response to changing fashion trends and failure to offer women lingerie product lines that address inclusivity and diversity. This has resulted in the company losing customers who have turned to other brands that better suit their needs in a more sensitive and personal manner. Victoria’s Secret recent partnership with NEXT PLC now affords it the opportunity to grow. The plan for the new partnership which the author has dubbed “Victoria’s NEXT Secret”, is to launch a media brand marketing plan through promoting a new customizable and personalized range of intimate women attire that are more body positive, inclusive and diverse; starting mid of 2021. The target is female consumers in various age groups, race, backgrounds and beliefs. The plan is to use digital and social media platforms to reach them. The campaign shall be for a duration of one year starting July 2021. Six influencers from different walks of the cultural spectrum will be used to drive awareness of the campaign with the aim of driving sales, attracting and keeping a new and diverse consumer base. The 6 influencers will represent the 6 products in the range. The opportunity report will present the product line, highlight the marketing and financial objectives, introduce the influencers and identify proof of their relevance to the campaign.

TABLE OF CONTENTS I. Situation Analysis

II. Marketing strategy

III. Marketing tactics

IV. Financials/Budget plan

V. Timelines/ Implementation controls

I. Situation Analysis

Victoria’s NEXT Secret has a variety of branded women lingerie and beauty products in the market. These products not only offer functional services to women but they are indeed a basic necessity. For this reason, their market is big and has potential to continue growing especially with the changing consumer trends and preferences. Millions of women aged 18-50 are the main buying group of the products. The industry is worth hundreds of billions. In the current global climate of push for inclusivity and diversity within the fashion industries, political scenes, social movements, pop cultural practices, businesses and other areas have increased. Diversity refers to the traits and characteristics that make people unique, while inclusion refers to the behaviour and social norms that ensure people feel welcome. It has been claimed that diverse and inclusive companies are 70% more likely to catch a new market audience. An example to the claim is Rihanna’s Fenty Beauty make up line; which sold $100 million worth of product within its first 40 days of its launch. This consists of 4o shades of all-inclusive foundation range; which was designed for individuals across the skin colour spectrum. Another one of their brands, SavageXFenty deals with a range of diverse an inclusive lingerie for women and men. This has caused a decline of sales for Victoria’s Secret and influenced their forced and late attempt at joining the trend. After years of criticism, Victoria’s Secret finally tried to embrace inclusivity with its new spring 2020 line ‘Body by Victoria’ campaign. The new line showcases trans, plus size and older models. As illustrated below, the models chosen to represent the campaign are still a farfetched imagery representation of the populous plus sized body and old aged models.

SWOT ANALYSIS A tabled SWOT analysis of Victoria’s Secret highlights the brands social media advantage over one of its competitors SavageXFenty. The following are opportunities the new line can exploit:

STRENGTHS

WEAKNESS

68.8M

3.9M

10.7M

202.5K

1.91M

203K

29.7M

573.4K

689.9K

15.6K 491.1K LINKED TREE

II.

Marketing strategy

The marketing strategy is aimed at achieving the following key marketing and financial objectives as well as the brand media marketing objective. Marketing and financial objectives: • To fight off competitors by offering women customizable and personalized attire that cater for all body types and needs. • To increase Victoria’s NEXT Secret brand awareness and recognition by at least 10% through relatable influencers. • To increase consumer engagement and grow sales revenue and profits by at least 5 percent. The marketing strategy campaign is to come up with a new inclusive and diverse line by the name ‘Victoria’s NEXT Secret,’ with the help of NEXT’s already existing and growing digital media within the UK consumer market.

The campaign range will have 6 personalized and customizable items consisting of the t-shirt bra, bralette, sports/lounge wear bra, body suite, body corset and a night dress. The pieces will be personalized through size, colour and fabric.

Meet the influencers The new line will be widely marketed by 6 influencers who strongly represent the diverse and inclusive culture. The disabled, elderly, black, gender fluid, plus sized and survivors. These will be well known people greatly appreciated, loved and influential within their community. They will help build a bridge, merging their current consumers to a completely new consumer base.

Georgia Ranki, 21; lives with skeletal dysplasia. Has over 700,000 YouTube followers

Alek Wek (born 16 April 1977). A South SudaneseBritish model and designer.

Hart, 34, is a survivor of bilateral breast cancer. She went viral for attending Afropunk festival topless, showing scars from her double mastectomy. She was on the runway of Chromat's Fall 2018 show at New York Fashion Week

Alok Vaid-Menon (born July 1, 1991) is an Indian-American writer, performance artist, and media personality who performs under the moniker ALOK. Alok is gender nonconforming and transfeminine. He has presented creative work in over 40 countries.

Naomi Watanabe 33; Japanese comedian, actress and fashion designer, a.k.a. “the Japanese Beyoncé”

Helen Ruth Elam (born July 18, 1928), better known as Baddie Winkle, is an American internet personality. She is an activist and influencer with millions of followers and views on social media

In order to meet the objectives, the print (magazines), digital (TV), and social media platforms shall be used for brand and products advertising and promotion activities. The target audience will be women of all sizes aged 18-80. The target is to reach 70-90 % of the various media regular customers. The campaign shall carry the same personalized, sustainable, inclusive and diverse message across all the media channels. The campaign is scheduled to initially run for a period of 1 year, a) Print (Magazines) tactics At least six (6) popular magazines that target women customers shall be used. These include:

Marketing tactics

Target reach: 80-90 % of the readership Frequency of adverts: monthly issues Budget (%) of total :2.5%

b) Digital (TV) tactics At least 3 popular TV networks with a national/regional reach or large viewership shall be utilized. A selection to be made from the following:

Source: Twitter.com

• Target reach: 80-90 % of the viewership • Frequency of adverts: Weekly • Budget (%) of total :40%

c) Social media tactics The currently most popular social media platforms to be considered for use include: TikTok, Instagram, Twitter, Snapchat, YouTube, Pinterest, Facebook, Netflix, Amazon, eBay

• Target reach:70-80 % of the channel users • Frequency of adverts: Weekly • Budget (%) of total :55%

d) Promotional campaigns tactics These shall involve popular and appropriate female fashion influencers/ brand ambassadors for the different channels, attending events, live interviews, radio interviews, podcasts, music videos and IGTV Stories • Target reach: 70-90 % of the channel users • Frequency of adverts: Weekly Budget (%) of total :2.5 % e) Images and messages Similar/same images and messages shall be used across all the relevant media channels.

Clamor to include models with plus-size bodies. Source: teenvogue.com

III. Financials /Budget plan

The budget estimate for the proposed media plan is in hundreds of millions of pounds. Each media channel or activity will be allocated a budget as a percentage of the total, depending on the expected impact it will have on the marketing. See Table

Budget allocations. Source: Author

IV. Timelines / Implementation controls Table shows the proposed schedule for adverts/promotions to be carried out by the various media channels. Necessary adjustments can be made to the schedule depending on the budget and feedback received.

Schedule of media activities. Source: Author

Specialists shall monitor and control the campaign activities and give feedback reports on a daily/weekly basis. The focus will be on expenses verses planned and actual outcomes of the media activities. This will enable appropriate measures are taken to ensure continuous improvement and success of the brand media marketing campaign.

CONCLUSION

After analyzing Victoria’s Secret brand through the lenses of the 5Ps of the marketing mix, it was noted that the brand has a strong foundation that has survived the test of covid-10 pandemic. The international fashion industry competitive environment forces are generally high. The macro and micro factors need to be managed. From SWOT analysis it is clear that Victoria’s Secret must be proactive by bringing innovation and creativity into its products and marketing strategies, in order to remain competitive and relevant in the global fashion market. The opportunity report shows how a brand media campaign targeted at diversification including the introduction of new product lines can help the brand succeed. From the report it can be concluded that consumers tend to judge brands positively or negatively based on how they perceive them. In addition, consumers do not only look for physical functionality in a brand, but also the emotional connection.

REFERENCES & BIBLIOGRAPHY