Levi's jeans from its origin “original, authentic, definitive and real”.
In 1853 Levi's Strauss arrives in San Francisco and the founder was Jacob Davis and originally known as Jacob Youphes from Latvia. He opens the first store in American West as of wholesale dry goods, and stores have all sorts of clothing, blankets, etc.
As we know that the Levi's Strauss Company is recognized one of the world's largest brand-name apparel marketers. The Levi's sales its product across 110 countries. The company manufactures and markets branded jeans and casual sportswear under the Levi's for men's women's and children's. Levis market-leading apparel products are sold under the Levi's®, Dockers® and Levi Strauss Signature® brands.
Dockers®: Levi's introduced this range in 1986 as a formal wear to gain the consumer interest towards khaki range. Before this Levi's was only dealing with jeans. The Dockers is a team use in Britain as a “longshoremen”. Dockers were mainly design to target men's and women's of age group 25 to 39. And with the laps of time he has introduced the several ranges followed as
- Dockers Premium
- Dockers Recode
- Extract Dockers
Levi Strauss signature: In 2003 Levi Strauss had launched his range under the brand name signature. Which soon became very popular among middle class people.
Levi Strauss signature included a wide range of jeans wear.
Levi's range included
- Tops, sweaters, jackets, and outerwear
- Kids wear
- Footwear and hosiery
- Loungewear and sleepwear
- Belts, bags and wallets
- Luggage and home bedding products
On 20 May 1873 the Levis had patented its product for the blue jeans from U.S patent and trademark office. They've been in the apparel market for last 156 years. The jeans would become a political statement and an American icon, as all jeans soon become known generically as “Levi's”.
In 1940s integrated factories were started in California. In American South a newly integrated plants was opened in 1960.The San Francisco, Brussels and Singapore has its regional headquarters and Singapore has its Global sourcing headquarters.
There are more than 60000 retail store worldwide which includes 1500 franchised store and also 260 company-operated stores around the world. The company had more than 11400 employees worldwide.
The company is privately owned by the family of Levi Strauss.
Background (company Growth)
- Over the years Levi's jeans became most popular because of its durability and it aim of targeting all age group.
- Eventually with the laps of time Levi's has captures most of denim jeans market. And the amazing thing is that by 1974 its profit reached to $1 billion.
Background (Time line)
- 1853: Start selling dry goods.
- 1873: Get patented and began selling them.
- 1912: Design the denim playsuit for children.
- 1935: Sold first blue jeans for women.
- 1940s: government Issue a denim clothing of workers in defence industry.
- 1974: compamy had enormous growth of $1 billion.
- 1986: Dockers brand was launched
- 2003: signature brand was launched
Marketing strategy is a functional level strategy which consists of
- STP (Segment , Target group , Position)
- Marketing mix.(Product , Price ,Place , Promotion)
Segment: - The process of dividing or disintegrate the market into a number of sub-markets or segment is known as Market Segmentation.
For example: market segmentation is the division of markets into similar group of customer, every one reacting differently to communication, promotion pricing and other variable of the marketing mix.
Geographical location is the major factor in segmentation of levis market, as the customer are residing in different areas.
Region and size: Levis is selling different clothing as per continent, country. For e.g. European, African, Asian etc have segmentation according to the culture. In Europe the denim jeans are the most preferable clothing for women's as compare to Asian. Availability of the store is depending upon the size of the area. As we see that London have more outlets as compared to county's.
Population density: Levis stores are most common in the urban sector as compared to the rural sector.
Age: Levis segmented its product according to different age group
Levis created brands for women's, men's. And it also has variety for children's. Because of this the sales increased dramatically during recent years.
Income: Income is major factor for segmentation.
Company have segments as per income group like the Levi's original is the premium brand of the company and have expensive clothing range which is preferable for high income group and brand conscious. And it has Levi's signature brand which is attracts and affordable to middle class income group.
Psychographic Segmentation: This segmentation groups customer according to their life style and buying Psychology. Levis offers product according to attitude, belifs and emotion of target market. The desire of status, enhance appearance and more money are example of psychographic segmentation.
Behaviouralistic segmentation: levis had segmented market on basis of buyer behaviour . As different customer group expect different benefits from the same product and therefore it directly reflect to the behaviour of buying. For e.g. there are 2 types of buyer the regular and occasional buyer. Levis had segment the market by keeping in mind the buyers need.
It is the process of pulling market as a whole and separating into manageable, disparate units based upon demographics.
Target market is a business term means particular goods are marketed through market segmentation.
Target marketing is a key of success for small business.
Till 1960 the target of Levis was middle age group people but with he laps of time it has changed his marketing target, now levis is promoting women's and children as well.
Levis market target strategies:
Single segment strategy- It is a concentrated strategy .Till 1960 Levis was having this strategy i.e. it was targeting middle age group people.
Selective specialization: It is a multiple segment strategy knows as differentiated strategy. For example Levis is now selling goods for all age group people in women, men etc.
Product specialization: It is important one must have specialization in one of his product. As levis have specialization in blue jeans.
Full market coverage: In this firm attempt to serve entire market. Now it is seen that Levis has summer and winter casuals. Also it has launched shoes and undergarments as well.
Therefore it is visualized as Levis capturing whole market.
Positioning: The position of levis is like branded product so its customer can forgive its brand and hence hade made a brand image in the mind of its customer because the customer can trust the company as levis is first jeans maker so there should not be any doubt about its product. The main aim of the company is to make the position of the product trust worthy in the eye of the consumer.
Levi Strauss & Co. is an international clothing company which studies what people wants and needs and therefore selling and promoting their products in a very competitive textile sector, especially in jeans market. Their marketing strategy has played a very significant role in the success of their products and hence making it a very successful company. They have been a world leader in the jeans apparel market for many years but they have also faced a continuous increase in competition along the way. They have suffered a bit due to a lack of adaptation to customers' needs. In this report I will be analysing the marketing strategies followed by the Levi's to make a niche in the market. Different variables have been selected for an alternative marketing mix. Through marketing research the company should vary depending on the country or product that the company is addressing.
Its worldwide known that levis is really a successful company producing, reading people needs, selling, distribution and its product promotion in a really competitive textile market, especially in the market of jeans, for many years. Levi Strauss & Co is an international company
What is marketing mix?
In marketing one of the most famous terms probably used is marketing mix. The element of marketing mix is the components of marketing plan which consists of “4ps”. It is known as four P's the elements of marketing mix are product, price, place, promotion
As example: A cake mix. All cake contains milk, flour, sugar, and eggs. In the same way all businesses contain mix of 4p's in relation to their marketing strategy is known market mix.
The 4p's are the parameters that the marketing manager can control, subject to the internal and external related to marketing environment. To full fill customers need a business must develop products to satisfy them, charge the right price, get the goods to the right place, and it must make the existence of the product known through promotion..
Definition of marketing mix:
Putting the right product in the right place, at the right price, at the right time.
Strategy of Levi's in relation to marketing mix which consists of product, price, place and Promotion is briefly described as below.
The company design and markets jeans and jeans-related pants, dress pants and casual, jackets, and shirts related accessories for men, women and children under Levi's(R), Dockers(R) and Levi Strauss signature(R) brand.
“The term “product” refers to tangible, physical products as well as services. Here are some examples of the product decisions to be made:
- Brand name
- Repairs and Support
- Warranty” http://www.netmba.com/marketing/mix/
Brand name: Levi Strauss as it is one the most popular and well known apparels makers of jeans, so it has a valuable brand name in the market and its product are been recognised as “original, authentic, definitive and real”.
Styling: Style & image are what characterize celebrities, actors, TV shows, music videos, advertising, businesses, shops and people. Levi's products aim at doing at the same with knowledge, expertise and experience of emerging trends fashion & looks. Levi's products basically aims at selected customers by targeting them with proper aim. Levi's styling had made a niche in style market with proper Fashion Styling & Image Design and market updating. Its style and casual market is today among the world's best casual market in the world.
Quality: As being a branded company in clothing market Levi Strauss is very much conscious about its quality of product. Because it's the quality which makes the product trust worthy to the customer.
Safety: It is a very important aspect in product because safety is really important as Levi's is very much conscious in safety it uses the best quality jeans material which don't harm to it's consumer and preferable to the body of consumer.
Repair and support: It is a service which is given by the company for satisfying its customer in relation to the main product. It is really important because at once customer can not fully satisfied with the product so it is a support for the customer if any wear or tear is their in the original product, for example: size, length, etc. They might be change or repair. So with this service customer can buy the product without any hesitation in their mind if they have any problem related with product after buying it that can be easily solved by repairing and changing the product. In this competitive market where customer is king this strategy is must for each and every company.
Warranty: This is also one of the important factors in relation to the product for the customer because customer needs warranty in each and every step one cannot judge the product at once therefore customer needs the surety for a time period about its basic function so that they can trust the company about product service and quality because if one company don't gives warranty than the consumer fell's about the quality of the product that its quality is inferior that's y only it won't gives the warranty.
It is a important in marketing mix it shows the value of the product and it is consider as an important aspect for the customer because customer wants full value of its money which he is spending to buy the product the following are Some factors which are to be consider in tacking pricing decision of product are as follow:
- Pricing strategy (skim, penetration, etc.): levis as it is the branded company in jeans field and have a brand image in its field the customer can forgive the company even though the price is not worthy for the product because customer buys its product by watching the name of the company as it is very trust worthy for the consumer
- Retail price: the company's retail price is an important factor because it is the price which is to be paid by the customer so it effect the thinking about the product as they are in direct touch of the customer not the company
- Price flexibility: As levis is an branded jeans apparel company there is no flexibility in the price because it have a brand image in its consumers mind therefore levis have fix price of their product.
- Price discrimination: levis price varies from country to country because every country have different social and political influence on the market so the company have to fix the price of the product depending on the factors mention above there for its price discriminate.
Distribution is about getting the products to the customer. Some examples of distribution decisions include:
- Distribution channels: The distribution channel of the company is consist of factory where the product is made than it goes to the company suppliers who distribute to the whole seller and then it goes to the retail shopkeeper than it goes to the consumer
- Market coverage (inclusive, selective, or exclusive distribution): the company covers a wide or exclusive market because its once of the well known company in jeans apparels so it covers a huge market
- Specific channel members: The company gives up the franchise to the people who needs it and then they become the member of the channel and this is how the company becomes famous and this is how the channel goes further
- Warehousing: the company uses its warehouse for keeping the stock of its goods because clothes are not made to order so there is need of stock for supply and for keeping that stock it needs warehouse and as its world wide spread company it needs its warehouse in each country where the products are available
- Distribution centres': the behaviour of consumer attitude towards retail store have changed dramatically in recent years, in order to increase the channel of sale to vendor, by watching this behaviour the manager of Levi's Strauss as per need upgraded the distribution centres
- Order processing: In this competitive market the order process should be very much fast and should be forecasted as for which thing the shortage is going to happen that's why the order process should be fast and the at the same time delivery.
In the context of the marketing mix, promotion represents the various aspects of marketing communication, that is, the communication of information about the product with the goal of generating a positive customer response. Marketing communication decisions include:
- Promotional strategy (push, pull, etc.): For any product of the company promotion is very much necessary because this the only way to send the product to whole market and to promote its new product to the market, promotion of any company is very much in such a competitive market
- Advertising: Levis Strauss advertise its product by many ways by giving add on television and by using the advertising holding and in newspaper and in magazine and such different means which is related to the consumer or which goes through the customer day by day
- Sales promotions: If the company want to increase the sales or any new product launched in the market than company wants to improve its promotion by sales this is done in various ways by giving discount on the product or by giving some offer in relation to the product
- Public relations & publicity: This is also a kind of promotion because by maintain relation with the public the company is indirectly promoting its product on the name of customer relation this is a kind of publicity infect this promotion is benefit for both the consumer and the seller because they can promote the product on the name of public relation and consumer is happy because they are being cared by the company personally
- Marketing communications budget: This is the budget which is being given to the marketing manager of the company and he is to decide where he has to spend its budget. This budget is related to the communication of product which is between company and the consumer because before any thing the communication reaches to the customer and brings the him to the product so this budget is really needful for the product and for sale also
- Going with the generation
- Always comes with something new to the market
Going with the generation: Levi's is always make new product and that is focus on young generation because when company launch 501 so young generation too much like then in 2005 Levi's new product “Reversible jeans” that jeans we wear both of side that jeans to much popular in young generation.
Diversified: Levi's make some different product so customer diverted on that because customer need some new think and different so company focus on what type of jeans customer need that type of jeans make and diverged to customer on it some type of different advertisement and hoarding launch in market then customer see that and ready to buy. And only Levi's company make jeans by order. Some people have problem in height, waste, Patten, etc. This facility launched in 1994 that name is “personal pair”
Always comes with something new to the market: First Levi's make only jeans and jeans-paint. Than company make another brand that name “Dockers” that famous for formal wear and we first company target high income group than company think about middle income group so they make Levi Strauss signature.
Recommendations and Proposal's:
- Introducing existing products in new markets.
- Developing new products for existing markets.
- Identifying & exploit growth segments.
- Invest heavily in most attractive markets ( as Dockers)
- If the company chooses differentiation with relative low costs is able to gain outstanding success
Levi's always make new product but it's range to high so middle income group cannot affordable that jeans so company's profitable ratio so high that big problem and company profit margin ratio go down so it's selling to high and all over company got profit. Company within 1-2 years launch new product that kind of company day to day high profit gain.