The impact of the financial meltdown on the luxury fashion goods market - Dissertation Example

? A Study on the Impact of Financial Meltdown on Luxury Fashion Goods Market and the Way Forward Online Selling [Date] Contents Serial No. Topic Page No. 1 Introduction 3 2 Literature Review 3 3 Research Objectives & Research Questions 5 3.1 Research Objectives 5 3.2 Research Questions 5 4 Research Design 6 5 Data Collection & Analysis 7 6 Credibility 8 7 Time Scale 9 References 1) Introduction: The probability of an economic slowdown in the world economy means a slowdown in the economic performance in most developing countries (IMF, 2008, p.136). Be the epicenter of a financial crisis in any country like the United States, but its effect is felt in the other nations as well, quite similarly to the manner in which the global economic crisis of 2008 impacted the industrial sectors of the United Kingdom (Naude, 2009, p.19). The worldwide economic crisis of 2008 disturbed the basics of the luxury fashion commodities industry globally. To ride out the outburst, the, industry players countered to new user demands and, in the course, redefined the industry of luxury. There have been considerable changes and challenges faced by the luxury goods companies. The research would also include the case of a handbag designer in Paris, France, named Philippe Rousseau, who worked hard to push his business all through the crisis period. (Lauder Global Business Insight Report, 2010, p.9). Thus the rationale for the research is to understand the impact of the global financial crisis on the luxury fashion goods industry and analyze the way forward to online selling, which has been introduced by several luxury goods organizations as a new means of attracting consumers, in the recovering face of a global financial meltdown. 2) Literature Review: By the end of 2007, the world had penetrated into a recession or a financial meltdown the origin of which were mortgage and credit crisis, thereby leading to unemployment. Consumer confidence got destabilized, and this caused a cutback in the spending habits of the customers. The economic strain and the indecisive future also created a comprehensive change in the fashion industry leading to joblessness, curtails in expenses, termination plans for growth and development, or at times bankruptcies and closure of the business (Taylor & Weerapana, 2009, p.782). The luxury sector started facing saturation in the market with thinning demand. Sales of high finish fashion goods were confronted by the consumers’ inclination to explore and evaluate prices, and find thorough information before buying. Designers started looking at partnerships with mass traders. Retailers and designers, in hunt of fresh clientele, pleaded to global apprehensions such as communally and environmentally accountable developed practice. It was by the end of the twentieth century that the industry started recovering and finding new ways of establishing their businesses again (Welters & Lillethun, 2011, p.111). Owing to the financial crisis, the middle class as well as many wealthy customers have been hit. Even those affluent groups who have not been individually affected by the crisis are changing their buying manners, a way of representatively taking part in the nationwide attempt and exhibiting harmony. In fact, the luxury sector gets more affected than other sectors by the consumers’ spending less on the products (Kapfere & Bastien, 2009). Philippe Roucou who is a handbag designer in Paris, has worked very hard to overcome the period of financial crisis. He started working for designer Gabrielle Cadet who designed hats and handbags, in 1988 and gradually became passionate for accessories (philipperoucou, n.d.). His own business at present sells about 1500 handbags internationally per year. He is also involved in certain other businesses like a studio of his own. (Lauder Global Business Insight Report, 2010, p.9). In today’s world as a means of attracting more consumers, the fashion goods companies are coming up with online selling facilities for their customers (Caroll & Broadhead, 2001, pp.437-475) . This include opening up of various sites that regularly provide information to different customers about new products and varieties through emails and other social sites. Websites like luxuryculture.com, fendi help their customers with the various information regarding new fashion goods, by sending them emails, which often attract them to buy such products (Okonkwo, 2009, pp.26-27). The research would do a detailed study on how the financial crisis impacted the fashion goods sector and how the organizations are coming up new online selling techniques attracting more customers. 3) Research Objectives & Research Questions: 3.1) Research Objectives: The main objectives of this research are: To learn about the luxury fashion goods sector To study the impacts of global financial crisis on the luxury fashion goods market To understand how the fashion goods companies are opening up new measures like online selling with a purpose of forwarding their business 3.2) Research Questions: Focusing on the objectives of the research, the research questions that would be dealt with are: (i) What is the scenario of the luxury fashion goods market before and after the global economic crisis of 2008? (ii) How did the financial crisis impact the fashion good market? (iii) How is online selling being a way forward for the fashion goods companies? 4) Research Design: Research methods followed in a study may be either qualitative or quantitative or a mixed method involving both the methods. Qualitative and quantitative methods can be distinguished by describing the two methods. Qualitative methods involve a researcher relating kinds of characters of people or actions exclusive of any measurements or amounts. Quantitative research, on the other hand, focuses on, figures and measurements of the characteristics exhibited by the people or the events (Thomas, 2003, p.1). For the purpose of this research, a combination of both the methods would be used to obtain greater accurate results. Also, both primary and secondary research would be conducted for this research. A primary research involves collection of original data particular to a research. A secondary research, on the other hand, does not involve collection of any original data but collects information from secondary sources, e.g., websites, etc. (Graton & Jones, 2010, p.8). A primary method would be used to collect original data for the study while a secondary study would also be conducted to learn about the fashion goods sector as a whole. The main focus of the study would reflect on the luxury fashion goods market and impacts of the financial crisis would be tried to be studied through the use of research tools. 5) Data Collection and Analysis: Considering the primary data collection, since the research would involve both qualitative and quantitative techniques, hence both open ended and close ended questions would be prepared for the data collection (Hyman & Sierra, 2009, p.154). Few of the fashion goods companies who have suffered through the financial crisis, would be selected, whose employees would be approached with the set-up questionnaires. The questionnaires would have standardized questions so that a comparison of their views can be made. One set of questionnaire would be open ended to know the impacts of the financial crisis on their companies. A second questionnaire would be to learn about their views, experiences, and opinions about the technique of online selling. Also interviews would be conducted for the managers of the companies, and in cases of their non attendance owing to busy schedule, emails would be used as a tool for data collection (Hewson, 2003, p.45). A total sample size of 50 would be used for the study that would comprise the employees of the company including managers. Another 50 respondents would be the common people who would be asked about their views on the online selling technique. For the study of the fashion goods sector as a whole, a secondary study would be conducted mainly based on internet researches. A study on a particular organization, by Philippe Roucou, would also be studied to bring up an example of a company that struggled through the financial crisis and recovered through the situation. Case studies would be analyzed for more accurate results (Campoy, 2005, pp.13-31). Based on the data collected, a detailed analysis would be conducted. The secondary data would be studied in detail and analyzed to learn about the fashion goods sector and about the company taken as an example. The primary data collected would be analyzed through statistical methods, plotting the data through graphs and charts and analyzing them to come to a conclusion (Cowan, 1998, pp.1-78). Credibility and Validity: Credibility is very essential in a research experiment. Therefore, utmost care would be taken regarding the validity, and reliability of the data that would be collected, and the information that would be gathered. The primary data would be collected directly from the employees of the Companies, hence the authenticity of the information is guaranteed. Moreover, the secondary study would be done from sources that are authentic and provide information based on past researches made on the company. The researches are also recent in nature which would ensure that the study made now would be well connected with the secondary study as well. 6) Time Scale The work would be scheduled and allocated as per the following chart: Work Time Allocation Work Ready By Project Proposal 1 Week July 10, 2011 Questionnaire Preparation 1 Week July 17, 2011 Primary data collection 3 Months October 17, 2011 Secondary data collection 1 Month November 17, 2011 Prepare analysis 1 Month December 17, 2011 Draft Preparation 1 Month January 17, 2012 Final report 15-20 days February 2012 References 1) Campoy, R. (2005), Case study analysis in the classroom, India: SAGE 2) Caroll, J. & R. Broadhead. (2001), Selling online: how to become a successful e-commerce merchant, Chicago: Dearborn Trade Publishing 3) Cowan, G. (1998), Statistical data analysis, United Kingdom: Oxford University Press 4) Gratton, C. & I. Jones. (2010), Research Methods for Sports Studies, United Kingsom: Taylor & Francis 5) Hewson, C. (2003), Internet research methods: a practical guide for the social and behavioural sciences, India: SAGE 6) Hyman, M. & J.J. Sierra. (2009), Marketing Research Kit for Dummies, United States: For Dummies 7) IMF. (2008), World Economic Outlook, October 2008, United States: Interntional Monetary Fund 8) Kapferer, J.N. & V. Bastien (2009). The specificity of luxury management: Turning marketing upside down. Palgrave-journals, 16, 311 – 322, available at: http://www.palgrave-journals.com/bm/journal/v16/n5/full/bm200851a.html (accessed on July 7, 2011) 9) Lauder Global Business Insight Report (2010). Knowledge@Wharton, available at: http://knowledge.wharton.upenn.edu/papers/download/021710_GlobalBiz_2010.pdf (accessed on July 7, 2011) 10) Naude, A. (2009). The Financial Crisis of 2008 and the Developing Countries. UNU-WIDER, Discussion Paper No. 2009/01, available at: http://www.wider.unu.edu/publications/working-papers/discussion-papers/2009/en_GB/dp2009-01/ (accessed on July 7, 2011) 11) Okonkwo, U. (2009), Luxury Online: Styles, Systems, Strategies, United States: Palgrave Macmillan 12) PHILIPPE ROUCOU (n.d.), philipperoucou-eshop, available at: http://www.philipperoucou-eshop.com/cms.php?id_cms=7 (accessed on July 7, 2011) 13) Taylor, J.B. & A. Weerapana. (2009), Principles of Economics: Global Financial Crisis Edition, United Kingdom: Cengage Learning 14) Thomas, R.M. (2003), Blending qualitative & quantitative research methods in theses and dissertations, United States: Corwin Press 15) Welters, L. & A. Lillethun. (2011), The Fashion Reader: Second Edition, United Kingdom: Berg Publishers Read More