Bravo's Burberry Takes Over - Essay Example

? Case Study Analysis Table of Content Bravo’s Burberry takes over 4 Answer 4 Strengths: 4 Weakness: 4 Answer 2. 4 Answer 4. 5 Answer 5. 6 Answer 6. 6 Answer 7. 7 Ocean Park takes over Hong Kong Disneyland 7 Answer 1. 7 Answer 2. 8 Answer 3. 9 Answer 4. 9 SWOT Analysis of Ocean Park 9 SWOT Analysis Hong Kong Disney 11 Answer 5. 13 Reference 15 Bravo’s Burberry takes over Answer 1. Market position of Burberry can be analysed by the analysis of strength and weaknesses of the brand before it’s takes over of Bravo. Strengths: Burberry had strong and effective management team. Effective licensing growth of the company delivered huge incremental return on its capital investment. The brand had been offering heritage product to its premium customers. The company was very flexible in terms of product sourcing. And it had cost effective exposure of lower transactional. Weakness: Limited vertical integration minimised the manufacturing margin and value. Low influence in Japanese upside Its Brand extension in apparel segment has increased high risk in fashion industry. Answer 2. Burberry had the market position in between top brands like Giorgio Armani and Polo Ralph Lauren in apparel and between Gucci and coach in accessories. The decision of Bravo to reposition the brand is to get the attraction of the younger customers towards the brand while getting Burberry’s customer base. The goal was to become top brand in the luxury greats. Bravo did not want to cutting edge the classical fashion trend of Burberry but it aimed to be popular in the new generation by reengineering the brand position in the market. Answer 3. Bravo and the effective team decided to reduce the dated product designed which created a huge unsold stock. It hired new efficient team for redesigning the product according to the trend of young generation and their choices so that the brand will be popular to this demographic segment of market. Lastly Burberry came up with new image of new designed product line. Teenager is so much different from someone else’s lifestyle that lives in the English countryside, just as the lifestyle of a banker is very different from the lifestyle of a fusionist. So unless we have a strong vision and speak with a consistent voice, we run the risk of losing our brand credibility. Answer 4. In 2002, the company was having 3126 wholesale clients in the world which consist of 434 medium and large departmental stores and 2728 company owned outlets. The company opened more 132 small stores in Barcelona, New York and London. It has a large number of existing customer base who are maximum classical and traditional choice of people who actually previously used to buy the old designed product of Burberry. By 2003, Burberry items, both legitimate and counterfeit, had become increasingly popular among urban youth and hip-hop musicians. A member of the house in the reality TV series Big Brother had worn Burberry constantly. Although this brand affiliation was viewed a positive sign that Burberry had achieved inspirational status among youth, there was a concern that this affiliation could eventually alienate Burberry's core customers. Answer 5. In keeping with the brand’s rough weather heritage, the women swear line traditionally focused on the autumn/winter season; however, it had evolved in recent years to include apparel for warmer climates. The spring/summer 2000 collection had even featured Burberry check bikinis, which had proven to be enormously popular. The company offered 330 to 350 styles per season, and the collection had been updated to include a wider assortment of fashion-influenced apparel. The accessories collection included “soft” accessories such as scarves, shawls, and ties, as well as “hard” accessories such as handbags, small leather goods (belts and wallets), women’s shoes, luggage, umbrellas, eyewear, and timepieces. As Pamela Harper, head of accessories, explained, “Accessories are a piece of the dream”; their wide range of price points made them an accessible entry point for potential new customers Answer 6. Over the past several years, the check had appeared everywhere—on socks, scarves, shoes, hats, coats, pants, jackets, bikinis, umbrellas, eyeglass cases, even chiffon underwear. Near about 10% to 15 % of all apparel sales overtly featured check; another 15% to 20 % featured the check in a seasonal color variation; a further 40% used the check subtly the remaining 40% did not feature the check at all. In accessories, 60% to 70% of all sales were check. It was estimated that 25% of all company revenue was directly derived from prominent check products. This meant managing the pervasiveness of the check in a strategic way. For her part, Bravo felt it was important that the company transition to a more restrained use of the check over the next few years. Answer 7. The brand was likely popular in the non-target customers as well. Burberry items, both legitimate and counterfeit, had become increasingly popular among urban youth and hip-hop musicians. A member of the house in the reality TV series Big Brother had worn Burberry constantly. It had not made any official statements about how it planned to deal with these emerging customer bases. Although this brand affiliation was viewed a positive sign that Burberry had achieved inspirational status among youth, there was a concern that this affiliation could eventually alienate Burberry's core customers. Ocean Park takes over Hong Kong Disneyland Answer 1. PEST Analysis of building Disney in Hong Kong Political and Legal: Any company will not be successful in terms of brand reputation and trust if it will not analyse the legal and political sector related to the project and the location of a new project. The Ocean park has been successful abide by the principle of its business ethics. The company has started legal operation in all areas of its business. The management as well as staff of the park confident about the services it provides to the audience to their standard and it will be satisfactory to the customers of nationality and age barriers. Economical: Economically, the park had enjoyed a competition free market since long 20 years and its economic status represented by the quality service it has been provided sine long past. Technological: Ocean Park has been using new technological advancement to attract visitors by innovative service. Use of modern technology is the key drivers of the park which have been fulfilling the demand. Answer 2. The Ocean Park is 30 years’ old park and the people have many times repeat visit to it and they are well aware of the product and the services. This is why the demand has been gone down and the management decided for the acquisition of Disneyland which has foreign brand value and got the new demand of new arrivals which it offers. So, it is the best strategy to acquire the competitors if financially possible rather than following their strategy. The Ocean park will get an global exposure by this acquisition. For the financial requirements, a large percentage Disneyland’s value i.e. $ 6.60 million is raised by Ocean Park through private venture (Au, Hung, Wong, Yam & Yau, “p.6”). Answer 3. Hong Kong Disneyland was tried its best level by promoting itself in different innovative way but these were ineffective effort of them. Few attractive things like serving shark, fin soup etc. they provided was appealing to few percentage of the targeted people but these became offensive to rest people. Apart from these, the big problems were in crowd control and very poor working environment created a bad impact on the culture of Hong Kong people. These poor sides of Disneyland affected the cultural sentiment of the local people and they represent these as they became emotionally injured to the local government but the government said to tolerate more. It should have been became more humble foundation and business operation then they would have been succeed in Hong Kong. They6 should have taken public feedback and implement those to better acceptance of the business culture which they didn’t do. Answer 4. Revitalization of the product line: This is one of the important step in the away of successful restructure of the brand Burberry. SWOT Analysis of Ocean Park Strengths Park is one of the popular attractions in Hong Kong with the local people as well as the 53% of the total tourists from overseas and China. According to the popularity, it has got the seventh position in world’s most popular amusement park. Ocean Park was the oldest park in Hong Kong and it is 30 years old and for this it is recognised as home-grown people’s park in Hong Kong. It provides educational and awareness programmes with professional trainers and unique environment. The park offers cable car service which shows breathtaking views of beautiful southern cost of Hong Kong. Location of park has easy accessibility of public transport and as well as available parking space. It follows many social responsibilities like special caring service are provided to the physically disable people, visually and hearing impaired persons. Weakness The park is located in a hilly area, so the land is not that much developed as it requires. It does not have a strong financial backup which is required to maintain the continuous operational cost even in crucial time of its business. As the park is about 30 years old and the facilities it provides is likely old and not follow the new trend of peoples’ choices. Though it has been started renovation but lack of financial backup it will take at least five to six years to complete. Opportunities In 2003, individual travelling scheme was launched and it has become most attractive sources of the park. Mainland has been growing with strong economy and apart from the upper class, income of the middle and lower middle class peoples’ is increasing which results a increasing purchasing power as well as improving life style and these factors catalyzing the outbound demand travel. It has got the recommendation of famous tourist spot for visitors from Hong Kong tourism department. It has started cross-boundary projects which consist of Hong Kong-Shenzhen Airport Co-Operation, Hong Kong-Zhuhai-Macao Bridge and Guanzhou-Shenzhen-Hong Kong. Threat Two major threats are there like the weather and the initial competition of Disneyland. The working environment of the Disneyland was better than the Ocean Park and it would not make that much affect to Disneyland in rainy season but the ocean park used to have close for any duration in time of heavy rainy season. SWOT Analysis Hong Kong Disney Strengths The park has appeal to the Chinese Culture and communications conducted in 3 languages. It has integrating local customs and business practices. Development of basic elements (gold, water, earth, and fire) managed throughout theme park. Ballroom of the Disney resort measured 888 square meters. Disney promoted as a recognized leader in training, leadership development, benchmarking and cultural change for business across the globe. Japanese-speaking Mickey and Minnie is the key attraction. It has a govt. back up as Hong Kong government and Disney on a shared venture. Hong Kong economy is on a rebound and creation of jobs is on a rise. Individual Visit Scheme emplaced by the Chinese government. Increasing visitors to the area is growing notification. Having Hong Kong Disneyland Hotel and Disneyland’s Hollywood Hotel with retail, dining and entertainment facilities will boost revenue. Disney promoted safety and quality of guest experience inside the Park. The offer of a refund for visitors is not returnable on another day from purchases of the flexible ticket sales. It has foundation of beliefs and values from Walter Disney. Disneyland provides guidelines for guest services. It has been maintaining some key areas of its business like experienced in training, leadership, development, benchmarking and cultural change. Weaknesses Crowd control became an issue in Disneyland and the working environment is poor. Size of the area is mall and limited number of attractions is there. Management refused to install a cleaner and less noisy air-launch system. Skepticism happens towards partnership between HK government and Disney. Press complained about press pass being confiscated and expelled from Park. Refused to verify or disclose cost of construction. Former employee sneaks through backstage with a knife. Financial loss of first year was HK$1 billion which is a big amount. Difficulties are there in adjusting to media environment in Hong Kong. Thus the brand image of the park gone downhill and impression of Disney deteriorated. Strengthen its communication with the public. Attendance for Labor Day Golden Week was below expectations. It does not able to meet target attendance goal. Retention of staff is low. Revenue target missed it goal. Breach in contract on loan agreement. Bad weather affects the business. Ticket Prices Higher than Ocean Park. Fireworks nightly drew complaints from residents. Working condition of factory works. Funding used drew criticism. Journalist tailed before Park opened. No meal offered on tour day. Suspect of food poisoning. Food and Environmental Hygiene Department is not there. Charity Event sold out caused nightmare and travel trade threatened to take legal actions. Opportunities Population of youth has been growing and a growth in the middle class. HK economy rebounded notably in 2004. Local consumers’ spending has been up surging and return of consumer confidence. Park could be a stepping stone for American company’s entry into mainland China. Service design has improved through improved outlook of employment. It has expanded through Disney theme park, additional hotels and retail, dining and entertainment complex. More tables and chairs in restaurants and more fast food carts selling snacks and drinks outdoors. Third-party jewelry retailer to sell custom designed Disney souvenirs in gold and diamonds. Threats Ocean Park faced a huge competition by Disneyland. Prices of Ocean Park tickets are comparatively high. It is aggressive in marketing and product development. It has new Jelly Spectacular. The company is more aggressive in selling group tour from the mainland. Ocean Park introduced 5 new attractions between 2000 and 2006. It preferred over Disneyland for its conservation and educational interests. 2,000 theme parks built in China between 1994 and 1999. Its services are of much high prices than competitors. Local activists against Disney are global sourcing activities. Travel Agents being squeezed only receiving KH$10 commission on each ticket sold. Legislators and politicians asked to limit capacity during opening periods. Answer 5. The Ocean Park has effective market position in Hong Kong entertainment market by continuous differentiating the product and services from Hong Kong Disney. Some innovative campaign were organised to strengthen the brand loyalty locally like “Love Ocean Park, Love Hong Kong” has effective worked and it got a mass response from the targeted people. A competitive market position is the result of an effective 4ps marketing strategy which recently it has adopted. Product: The Company has developed a team for its public relation which shares past good stories to the audiences. People have been said that the product and services which it offers were likely old and they were tired of seeing these and anxiously awaited for new arrivals. Price: It has launched ‘SmartFun’ Annual pass. It was one important price differentiation made by the park because previously Disney did not provide this type of annual subscription for its priority customer for loyalty. Place: The Park has developed a sense of value through its placement. Disney has a great brand presence in Hong Kong and it was lucky to get it because it is recognised as foreign brand. But, local people give a lot of value to the Ocean Park because it is home grown. They have been growing up past memories around it and the park also has built on that. Promotion: A sea lion named Whisker is the key attraction of the park which has been creating an effective promotion of it. Enter a sea lion named Whisker was formed in a potential mascot’s audition which was a sea lion character. It inevitably comes in furry suited or the graphic version to peoples’ mind when they think about the Ocean Park. Reference Au, D., Hung, K., Wong, C., Yam, M. & Yau, O. Ocean Park takes over Hong Kong Disneyland. 2006. Read More