Strategic Marketing Report Fat Face 2014 Lucy Ballard
Contents Page Introduction: Fat Face’s Market Position 2 Product Range 3 Product Lifecycle 4-6 Costumer Profile 7 Current Marketing & Channel Strategy 8-9 Brand Positioning & Competitors 10 Competitors Marketing 11-12 Social Media Comparison 13 SWOT 14-16 Pestle 17 Fat Face Finances & Forecast 18 Survey Analysis - Future Marketing Strategies 19 Future Marketing Strategy (Loyalty Card) 20-22 Bibliography 23-24 Appendix 25-40
Introduction: Fat Face’s Market Position
Fat Face began in 1988 whilst Tim Slade and Jules Leaver were skiing in the French Alps. Enjoying the leisure of not working, they soon discovered they were slowly running out of money to continue their travels. Hence - Fat Face was born, creating simple printed t-shirts and sweatshirts, in which they sold in the evening and skied during the day. With over 200 stores currently across the UK and Ireland, Fat Face continues to grow it’s ongoing womenswear, menswear, childrenswear (ranging from 4-13yrs), footwear and accessories. All of these are designed at HQ in Havant, Hampshire. (Fat Face, 2014)
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Product Range Fat Face has a wide range of products that caters for women, men and young children. From anything as small as £8 for a child’s scarf or hat up to £58 for a women’s waterproof jacket. Not being a fashion led brand, Fat Face is a lifestyle brand that tailors for costumers who are always on their feet, if that be enjoying a jog along the pier or simply soaking up the sun on the slopes or along the coast. Signature fabrics include cotton and denim, being practical materials, that are known for the quality and long lasting life. Accessories and jewellery include materials such as shells, pebbles and stones, whilst shoes and bags are made from leather and canvas, being the ideal textiles to create practical, long lasting products.
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Product Lifecycle
Looking at the Product Lifecycle graph, (fig. 1) it’s clear to see that companies invest money when developing a product, therefore not making a profit. As the product is introduced to the companies shop floor, sales then start to increase on this particular product and the company then sees the product paying itself back from the money invested due to development. ‘This stage of the cycle could be the most expensive for a company launching a new product. The sales are low, although they will be increasing. On the other hand, the cost of things like research and development and the marketing needed to launch the product can be very high.’ (Anon, 2014)
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As the product hits it’s maturity peak, it will then drop into the sales, therefore the company, from then on, will be receiving a smaller profit from this product. ‘Eventually, the market for a product will start to shrink, and this is what’s known as the decline stage. This shrinkage could be due to the market becoming saturated, or because the consumers are switching to a different type of product.’ (Anon, 2014) However, this graph doesn’t apply to every product that companies produce, as Dymond explains, ‘The shape of the curve, will typically alter for each product. In fact, the life cycle of some products may be as short as a day.’ (Dymond, 2013)
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Product Life Cycle Examples: 1) Watching TV 1) Introduction - 3D TVs 2) Growth - Blue-ray 3) Maturity - DVD 4) Decline - Video cassette ‘Not only do companies need to understand this life cycle, but to also pro actively manage products throughout their lifetime, applying the appropriate resources and sales and marketing strategies, depending on what stage products are at in the cycle.’ (Anon, 2014)
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Consumer Profile Fat Face’s target market is aimed between the ages of late 30’s/early 40’s to mid 50’s. Considering that this is a large age bracket, this age group is commonly known for having a larger disposable income. This age group is also known for appreciating the outdoor environment, if that be watersports, snowsports or leisurely outdoor activities. On the companies official website, Fat Face have released a series of short videos - Fat Films - in which are short clips of models wearing the products. These videos are a great way to show the personality and ethos of Fat Face, however, there have been questions about the older models looking too young, representing a false market. Yet, evidence shows that on Mumsnet, younger people occassionally do shop at Fat Face: ‘I’m 27 and love both, as does my 53-year-old mum.’ (Pixiemoon, 2009) ‘I like fat face. I’m 28!’ (Gemmummy, 2009) 7
Current Marketing & Channel Strategy Before April 2010, Fat Face’s Chief Executive Officer (CEO) was former Monsoon Brand Director, Louise Barnes. After a year of being in the job she said to Ian Wallis at StartUps, ‘A strong marketing strategy didn’t exist when she arrived and instead customers could ‘buy a T-shirt and win a bike’ or something similar. “It wasn’t geared closely enough to commercial activity.”’ (Wallis, 2007) Fat Face use multiple ways to market their products - YouTube videos /films, competitions to win Fat Face products or money to spend in Fat Face, designing competitions that Fat Face would use e.g. t-shirts, catalogues, swing tags, online and high street stores. Evidence shows that, ‘Late last year, Fat Face revealed that 11% of all its sales come online, and in the run-up to Christmas, the importance of online has become even more apparent. December sales online rose by 65% year on year for Fat Face, while there has been a 35% year8
Brand Positioning & Competitors on-year increase in orders being placed online and customers going in to store for collection.’ (Roberts, 2013) With sales rising, Fat Face expanded internationally to raise awareness of the brand outside the UK, ‘“We got particularly excited when our first international franchises went live, when the store opened in the Middle East and did very well, we felt we had something truly exciting on our hands.”’ (Dawson, anon)
In reference to the brand positioning map (fig. 3), Fat Face is seen to be almost in the middle of the graph, meaning that the company is not fashion led, yet the products resemble classic aesthetics. Sat closely next to Fat Face is competitor, White Stuff. Whilst White Stuff has a more classic approach in their product, it is slightly more expensive in comparison. However, Fat Face has the upper hand, as White Stuff do not have a childrens line. Crew Clothing is also above White Stuff, making it more expensive, yet still has a classic range of products. On the other end of the scale are Abercrombie & Fitch and Holister. These brands are more trend led and are considerably more expensive then Fat Face.
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Competitors Marketing Competitors including brands such as Joules, Crew Clothing Ltd and White Stuff, each market their own products in individual methods. Being similar in what they each sell and convey, Fat Face could benefit from watching competitors. On Joules’ official web page, they include a link to their official Instagram page, with images that customers have uploaded of how they’ve styled their purchased clothes, in which Joules has linked directly to that product on their website. Joules has also given people who enter their website, an opportunity to win a weeks stay in a Norfolk cottage including £500 worth of Joules vouchers. This competition is found directly on their home page and to enter, you have to have a Facebook account. The competition gives an idea of what the average Joules customer is and what sort of lifestyle they lead.
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Crew Clothing Ltd however, offers a bigger deal, also found directly on their official web page. On their website, they promote warehouse sales and events with up to 80% off. These sales beneficially last for longer periods of time - 3 to 4 days long and travel around the UK during the Summer period. White Stuff promote free desktop downloads on their website, where customers can instantly download calender wallpapers for their computers. They also have a competition to win a 7 nights glamping, where anyone just needs to complete the survey provided. Recently, White Stuff had a direct link on the their home page, which had the opportunity to give to the UK Flood Appeal charity. This goes to show how White Stuff supports the environment, which may also reflect the type of customer that they attract.
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Social Media Comparison On social media sites such as Twitter and Facebook, Fat Face has many followers compared to their competitors such as White Stuff and Crew Clothing Ltd. From the 11th April 2014, Fat Face’s current tally of Facebook likes is 97,665 and has 17.8k followers on Twitter. White Stuff and Crew Clothing Ltd, haven’t got as many likes or followers on Facebook and Twitter compared to Fat Face. White Stuff has 42,766 likes on Facebook while Crew Clothing Ltd has 20,329 likes. Similar on Twitter, White Stuff has 5,974 followers and Crew Clothing Ltd had 5,850 followers. On the other hand, competitor Joules has successfully got its market on Twitter (32.5k followers) and Facebook (207k likes). So what are Joules doing that Fat Face isn’t? 13
SWOT Analysis (Internal & External - Micro) In reference to the SWOT diagram (fig. 4) as guidance, Fat Face have a variety of strengths, weaknesses, opportunities and threats. Strengths (Internal) Fat Face have recognised their clear, loyal target costumer, through years of research and customer feedback. Having a strong, individual identity comes to Fat Face’s benefit when picking out who they’re selling to and what they’re selling. Fat Face looks after their staff (also known as ‘Crew’) and they convey their message through selling to customers love of life outside the 9-5. Most recently, the company has introduced ‘Activ 88,’ a line in which appeals to the active, sports customer. Lines like these keep Fat Face in a strong brand presence by raising awareness of what else they also sell, as well as sportswear. Weaknesses (Internal) Having a strong, individual personality, Fat Face still has competitors who sell similar products and share similar qualities and ethics. Some of these brands include Hollister, Abercrombie & Fitch, White Stuff, Joules etc. This pressure can also affect Fat Face’s financial status as customers may or may not want to shop 14
at cheaper or more expensive stores who offer more or less quality. Not being trend led, Fat Face has the drawback of not enticing fashion led consumers and possibly certain students. Opportunities (External) Having the opportunity to appeal to younger market would be a large challenge for Fat Face. Creating a line for teens and students would mean marketing to that age range as well as keeping up with the marketing they are currently doing now. Or on the other hand, aiming at the older market, who are commonly known for having a larger disposable income.
Threats (External) Recent weather in the past few months affected the footfall in store and instore sales as it wouldn’t appeal to customers to go out and shop. Yet, even if customers chose to shop online, the weather determined if deliveries would get to customers on time. Seeing stats on Facebook and Twitter has shown greater competition between Fat Face and it’s competitors. This could be in competition with price, design, style, trend or quality. This could potentially mean that Fat Face loses loyal customers to its competitors.
Fat Face could also consider looking at the models in their YouTube videos and what that image portrays to their current market. Having younger looking models is complicated for the older market to understand. The opportunity being to update the image to aim at their target market better.
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Pestle (Macro) Political & Legal As and when the political party changes within the UK, this could affect Fat Face’s company by the changes in tax or import taxes. This could force Fat Face to raise the price of their products to pay for this change. Economic Economy could introduce bank restrictions on company loans, however, this wouldn’t effect Fat Face too greatly as they don’t rely too strongly on loans nowadays. If the price of cotton and textiles were to increase, the company would have to look at increasing the selling price of their products.
These two fabrics are commonly known for being expensive already. Social Certain consumers desire more trend led clothing, which puts Fat Face at a disadvantage. If this were to affect the company, the idea would be to start designing more on trend pieces, however this may lead to Fat Face losing current loyal customers who buy what they already design. There maybe a higher percentage of the mature population with disposable income and discovering what Fat Face sell, therefore increasing the population of the target market and selling greater stock. 17
Technological With the current leap of technology, Fat Face need to keep up with the quick advancing of technology. The company could expand their online presence by using Instagram and create a more user friendly web page on mobile devices, making it easier for consumers to buy & browse on the go. Environmental With natural weather disasters in past months, this slows down delivery considerably for both online and in store, affecting seasons sales. The harsh weather could create damage to stores, creating a huge cost of repairs. The unpredictable weather in the UK could affect seasons sales due to cold, wet weather in Summer months.
Fat Face Finances & Forecast With access to Fat Face’s Finance reports from 2010, a graph was produced (fig. 5) to see the results at a glance with ease. It’s obvious to see that the company is marketing their products in a efficient and an effective way to target their consumers. In the year 2010, Fat Face made a turnover of £135.40 million and last year (2013) they made a turnover of £178.60 million. Analysing Mintel’s reports (fig. 6), the UK is climbing out of the recession with men’s and women’s fashion consumer expenditure predicted to carry on increasing in 2015.
(Fat Face Reports, 2011-2013) 18
Survey Analysis - Future Marketing Strategies Creating a survey (fig. 2) was a good source of collecting primary data from consumers and the public. Asking if people knew about Fat Face’s service of a 10% student discount, 40% didn’t know that Fat Face offered this and wouldn’t be interested in purchasing, yet 25% also didn’t know about the discount but would now be more likely to purchase. On the survey, people were able to pick what would interest them to shop at Fat Face. Joint first with 37%, was both discounts (excluding student discount) and offering a range of home accessories came top place in the survey.
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Future Marketing Strategy (Loyalty Card) For Fat Face’s benefit to move forward financially and efficiently, creating a loyalty card would be in the companies best interest. This card would be the epicentre of research for Fat Face and finding a wider data base for the company - including building a data base of customers details to send out catalogues, promotions, discounts, news and more. But to also keep track of what customers are buying in-store and online. This will give the company an idea about stock in certain shops across the country. However, this card could also act as a credit card, where customers can pay on the card and pay back at the end of the month. 20
Customers will be able to sign up to get a loyalty card at a till point or online when purchasing a product. They’ll have to include their home address and which store in the country they’re closest too. They’d also have to include their email address and phone number, which they can choose which one to receive promotions and news on. This card would be launched by a internationally known sport celebrity such as Jenny Jones - Bronze Medal winner for the UK in the Sochi 2014 Olympics. As the Fat Face’s brand history started on the slopes of the French Alps, it would be beneficial to include a relative celebrity such as Jenny Jones.
Pros - Promotions, discounts online and in store - An incentive for customers - first costumers to receive catalogues, promotions - Builds a database for Fat Face HQ - Cost effective Cons - Another spending temptation - Technical difficulties
‘Successful loyalty programs around the world have been based on a clear on a clear view of what loyalty means and how it can be directed to increase customer goodwill.’ ‘Costumers are loyal to the brand’ (Humby et al. 2008, p.15)
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Bibliography ANON., 2014. Product Life Cycle Stages [online]. Available: http://productlifecyclestages.com/ [accessed 9 April 2014] ANON., 2010. Joules in talks to hire former Fat Face chief Louise Barnes [online]. Available: http://www.retail-week.com/people/joules-in-talks-to-hire-formerfat-face-chief-louise-barnes/5016358.article [accessed 10 April 2014] DAWSON, A., Anon. Fat Face [online]. Avilable: http://www.adventinternational.com/ InvestmentData/Pages/Fat%20Face_English.aspx [accessed 10 April 2014] DYMOND, R., 2013. Product Lifecycle Curve (PLC) [online]. Available: http://www. dymondinstitute.qld.edu.au/marketing/product-lifecycle-curve-plc-template/ [accessed 9 April 2014] FAT FACE., 2014. The Fat Face Story [online]. Available: http://www.fatface.com/corporate/our-story/page/corpffstory [accessed 9 April 2014] FAT FACE REPORTS., 2011-2013. Financial Statements [online] Available: http:// www.fatface.com/corporate/financial-performance/page/corpfinancialperformance [accessed 2 March 2014]
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GEMMUMMY., 2009. Mumsnet Talk: White Stuff or Fat Face? [online]. Available: http://www.mumsnet.com/Talk/style_and_beauty/786936-White-stuff-or-fat-face/AllOnOnePage [accessed 10 April 2014] HUMBY, C., T. HUNT and T. PHILLIPS, 2008. Scoring points: How Tesco Continues To Win Customer Loyalty. 2nd ed. London: Kogan Page LIM, R., 2013. Why You Should Do a SWOT Analysis for Project Management [online]. Accessed: http://project-management.com/why-you-should-do-a-swot-analysis-for-project-management/ [accessed 11 April 2014]
MINTEL. 2011. Infographics Brand Research [online]. Available: http://www. mintel.com/us-email/Infographics_brandresearch.pdf [accessed 2 March 2014] PIXIEMOON., 2009. Mumsnet Talk: White Stuff or Fat Face? [online]. Available: http:// www.mumsnet.com/Talk/style_and_beauty/786936-White-stuff-or-fat-face/AllOnOnePage [accessed 10 April 2014] ROBERTS, J., 2013. Dressing to Impress [online]. Available: http://www.marketingweek.co.uk/analysis/digital-strategy/dressing-to-impress/4005494.article [accessed 10 April 2014] WALLIS, I., 2007. Fat Face: Louise Barnes [online]. Available: http://startups.co.uk/ fat-face-louise-barnes/ [accessed 10 April]
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Appendix
Fig. 2 Fat Face Survey
Fig. 1 Product Life Cycle DYMOND, R., 2013. Product Lifecycle Curve (PLC) [online]. Available: http://www.dymondinstitute.qld.edu.au/marketing/product-lifecycle-curve-plc-template/ [accessed 9 April 2014]
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Fig. 3 Brand Positioning Map
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Fig. 4 SWOT Guidance Diagram LIM, R., 2013. Why You Should Do a SWOT Analysis for Project Management [online]. Accessed: http://project-management.com/why-you-shoulddo-a-swot-analysis-for-project-management/ [accessed 11 April 2014]
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Fig. 5 Fat Face Turnover Graph FAT FACE REPORTS. 2011-2013. Financial Statements [online] Available: http://www.fatface.com/corporate/financial-performance/ page/corpfinancialperformance [accessed 2 March 2014]
Fig. 6 Mintel Forecast Graph MINTEL. 2011. Infographics Brand Research [online]. Available: http://www.mintel.com/us-email/Infographics_brandresearch.pdf [accessed 2 March 2014
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