Reiss Three Year Marketing Plan

1. INTRODUCTION

Created in 1979 by David Reiss, Reiss is has developed into a powerful brand offering stylish clothes at affordable prices. 2006 proved to be a successful year for the organization, where it achieved Ð'Ј6.8 million in operating profit and sales of Ð'Ј44.5 million. Currently, it has 39 stores worldwide and is expanding rapidly. The following 3 year strategic marketing plan will demonstrate the steps Reiss need to take in order to become a dominant force in the UK and a strong international brand.

Keys to success:

• E-business development

• International expansion

• Domestic market growth

• Product development

• Brand awareness

• Organization flexibility

2. SITUATION ANALYSIS

2. 1 MACRO ENVIRONMENT

• ECONOMIC

o In order to tackle interest rates, The Bank of England has increased interest rates to 5.25%, which will subsequently decrease consumer expenditure.

o The recent rise of inflation to 3% has made it more expensive and left less disposable income for consumers.

o The key Consumer Price Index to a decade high of 2.7%.

o Although, unemployment decreased by 7,000 from August to October, leaving it to 5.5% in the UK

o General consumer expenditure (GMID 2006) has increased to Ð'Ј742,977,000,000, which can be demonstrated in figure 1.

• SOCIAL

o The UK populations is ageing

o The birth rate is declining.

2.2 MARKET ANALYSIS

o Overview

• There is still a strong interest in fashion.

• UK spending on clothing has increased, which can be demonstrated in figure 2.

• Demand is doing well, but the industry is expected to fluctuate due increasing costs in borrowing. 2006 is projected to be a tougher year.

• Although costs are increasing, prices of clothing are decreasing due to a very competitive market.

o Opportunities

• Although lowers price have increased demand, consumers are not mainly influenced by price when making sales. Fashion is one of the main elements.

• Celebrities and fashion media are still a huge influence in the market.

• Sales of fashion accessories have increased by 40% from 2000 to 2005 (Mintel вЂ" Fashion Accessories Retailing вЂ" 2006).

o Threats

• Demand is expected to decrease in 2007

• Erratic weather and fashion trends make it more difficult for retailers.

• Price Deflation.

• Catwalk trends have become less influential than previously, due to the erratic market.

o PORTERS 5 FORCES

• The Bargaining Power of Customers

• Buyer power is high due to substitutes.

• Buyer price sensitivity is high.

• Buyer volume has risen.

• Buyer information availability has increased.

• Switching costs are low.

• The Bargaining Power of Suppliers

• Bargaining Power is low.

• High presence of substitute inputs.

• Supplier switching costs low.

• The Threat of New Entrants

• Barriers to entry low.

• Switching costs low.

• Access to Distribution easy.

• Government policy liberal.

• Brand identity strong.

• The Threat of Substitute Products

• Buyer switching costs low.

• Level of product differentiation high.

• Brand loyalty decreasing.

• Price elasticity increasing.

• The Intensity of Competitive Rivalry.

• Competition high

• Industry growing.

• Middle market being squeezed.

• High diversity

• Brand equity high.

2.3 CONSUMER ANALYSIS

o Overview

• In 2006, the fashion market has become very competitive and consumers have become more demanding of price, quality, and styling (Mintel вЂ" Clothing Retailing 2006).

• Customers are a lot more fashion conscious now and confident with what they