New Business Proposal for ASOS - Essay Example

?Company: ASOS Introduction: Increasing awareness of the harmful implications of several of the products that we use in our daily lives has grown theconcern for our environment over the past few years. With this increasing awareness, there has also been a dawn of realization that exploitation of the balance of nature is likely to result in dire consequences for mankind and hence, people are now more driven towards environmental concern (Eccleston, 2007). In view of these developments, the product idea chosen for the assignment is of ASOS reusable, recycleddelivery/envelope/shopper bags. The awareness of the need of such bags has been around for quite some time now following the production of plastic bags in 1977 and awareness of their dire effects on the environment (Green. kit, 2011). The product is targeted towardsa customer base that has concern for the environment, and wants to contribute to its wellbeing by reducing their eco/foot print impact etc. The product is also expected to do well in the market because of its uniqueness and the fact that no online retailer has done this before. The detailed marketing strategy of the product has been discussed as follows: Product Strategy: The reusable and recycled bags are to be made of both recycled cotton and plastic materials. The brand awareness of ASOS will be relied upon as one of the key competitive advantages. Along with that, the good relationships of the ASOS brand with the suppliers and the high purchasing power that it has will also serve as a plus for the awareness and promotion of these bags. Another key aspect that would greatly benefit the product would be that of first mover advantage as up till now no online retailer has come up with this sort of idea. The bags will be made available to the markets of the UK and Ireland only. These bags would be large in size so as to serve for accommodating things for multiple purposes (posting, usage etc.) and they would have the ASOS logo on them. A specific percentage of the revenues generated would be granted to charities so as to better create an impact in terms of working towards the collective good of people and the overall society. The product is to be similar to Anya Hindermarch’s ‘I am not a plastic bag’ concept that encouraged people not to use plastic bags (Winterman, 2007) with a number of customized touches added to it. These would include a more stylish outlook, larger size that is to add to its value in terms of convenience, and finally, because of its outlook and size, these bags would be multipurpose serving the purposes of both shopping and delivering. The bag would also have specific customer number ID on it which would allow bag tracking/identification. The bag would be designed as such that it would ensure maximum protection of the clothes etc. placed in it. The bags would say, “Yes I shop at ASOS because I carry their delivery envelope shopping bag”. Once, the product has established itself in the market, the producers can even go on to offer a variety in the colours and styles being offered and can eventually go on to offer customization options as well to grab all the more market share. Pricing: The pricing strategy has been decided to be cost based pricing in which the price is set in accordance to the production costs inculcating costs of goods and fixed assets plus a specific amount of profit margin (Allen, 2012). On that note, the price of the bags has been estimated to be in the bracket of about ?2.00 or 2.50 as a certain percentage of the revenues would also be going to some welfare cause or charity and hence that would also be kept under consideration while setting the final price. Place: The bag would be produced and supplied by a supplier with the design accustomed to ASOS brand. Special trainings would be given to the logistics team in terms of identifying the bag, instructions on usage of the bag, dealing with lost or damaged bags (small charge, goodwill replacements) and in terms of teaching customers on how, why and where to use the bags. Promotion: The promotional activity of the bags would be initiated two weeks prior to the launch of the product in order to start generating an awareness and demand before the actual launch through the factor of anticipation. A specific page of the product would be made on Facebook enlisting all the product information and its advantages. The page would be kept updated in terms of product related information and the various promotional activities being carried out. Along with that, information would also be made available on the website, both on the homepage and the green room, in terms of the usage instructions, explanations, benefits, dynamic introduction and user information etc. Direct marketing would also be carried out through door drops of leaflets that look and fold like the original bag itself and would serve the purpose of informing and teaching the customers about the product. Information of the customers having made purchases in the last six months from ASOS would be retrieved from the company’s databasewho will then be door dropped with these leaflets. Along with that, two weeks prior to the launch, these leaflets would also be put in all the deliveries being made during that period. The product would also be advertised through PR and print media with ads in all the major fashion magazines in the two countries and newspapers. A brand ambassador can also be hired from the fashion industry for the promotion of the product once it has been launched. Along with that, samples of bags would also be sent to free of cost to the major fashion journalists, stylists, models, bloggers and other influential fashion individuals to get the hype going. On the day of the launch, free bags would be given on the purchase of over ?65-70 worth of shopping from the site. The aspect of the chunk of sales going to charity would be specifically highlighted to create a better image of the brand as is being done by eBay (2012). Two weeks following the launch, the sales and effectiveness of the promotional efforts will be assessed. The promotional efforts will be revamped if significant fall in sales in observed. People: The people delivering the product and those dealing with the customers one on one would have to be specifically trained and educated in terms of the product characteristics. They would also have to be trained in terms of dealing with the customers and going an extra mile to fulfil the gap in terms of the lack of their physical existence. They would also have to be trained in turn to educate the customers about the product and its user characteristics. Process: After having created a demand in the market, the brand expects an inflow of demand through online orders and plans to cater to the demand in the manner just as ASOS does. Help lines will be established for customers that want to check the status of their delivery. If the customers are not be available to receive the delivery they can be given an address to collect their products from. Physical Evidence: As the product is related to the ASOS brand which has no physical existence, hence the product that we are launching won’t have one either. The product is basically relying on the virtual existence factor and consequently, it plans to cater to the customer base online. Even though the lack of physical existence is likely to create a gap in the market for the product, however we plan to rely on the factor of awareness and the demand generated through promotional campaigns to cover that up through online correspondence alone. Ultimate Objective & Future Prospects: The reusable and recycled bags will be designed with the ideal of doing the corporate bit to reduce environmental impact and footprints. It would promote reduction in the usage of plastic and card in delivery system. Future prospects would include increasing brand awareness and equity, and also to boost the level of sales and customer loyalty. After having established the brand, some of the packaging costs would be tried to be reduced. Other than that, having established itself in the local market, the brand can then go on to establish itself in international markets as well. The product being of standard nature would not have to be customized to local market needs and hence, no additional production costs would be incurred. In the international arena, the brand could also be promoted using the same marketing strategy for creating awareness and generating demand as in UK and Ireland. Other than that, it can also go on to provide more design options and/or increase profit margins. References: Allen, Scott., 2012. Pricing Methods. About.com. [online] Available at: http://entrepreneurs.about.com/od/salesmarketing/a/pricingstrategy_2.htm [Accessed 22 February 2012] eBay, 2012. eBay for Charity- selling to benefit a charity. [online] Available at: http://pages.ebay.co.uk/help/sell/selling-nonprofit.html [Accessed 22 February 2012] Eccleston, Paul., 2007. Public ‘concerned on environment’. The Telegraph. [online] Available at http://www.telegraph.co.uk/earth/earthnews/3312688/Public-concerned-on-environment-survey-says.html [Accessed 22 February 2012] Green.Kit, 2011.Why use cloth shopping bags? [online] Available at: http://www.green-kits.com/paperorplastic.html [Accessed 22 February 2012] Winterman, Denise., 2007. It’s in the bag, darling. BBC News. [online] Available at: http://news.bbc.co.uk/2/hi/uk_news/magazine/6587169.stm [Accessed 22 February 2012] Read More