Unit 2 – Developing a Marketing Campaign | Decreal Gear
Marketing Aims and Objectives:
It is felt that Decreal Gear could consider the aim of increasing revenue by
approximately 50% within the period of the upcoming thirty weeks, this aim is
specific as it is clear. Decreal can pursue this through a series of objectives that
will enhance their sportswear business and their operations. For example, they
could strive to achieve their aim through the objective of increasing brand
awareness on social media platforms such as TikTok or YouTube as both platforms
have seen exceptional growth and popularity. According to Decreal’s primary
research on media selection, TikTok has a vibrant community of 100 million users
in Europe. This may help Decreal Gear as an opportunity to increase revenue will
alight – more people will be aware of the brand which will result in more sales.
Further research undertaken by Decreal demonstrates that its customers are
mainly fitness enthusiasts, aged 25-35, which aligns well with the audience of
TikTok to a degree, as the most popular group on the platform is 18-24 followed
by 25-35. This may hinder Decreal and its ability to increase revenue as TikTok
may promote their products to the wrong audience, which may be problematic as
the campaign could achieve minimal results. On the other hand, YouTube is most
popular with the target audience of Decreal Gear which will help to promote their
business to the right audience. The primary research conducted by Decreal shows
that YouTube has over 35 million users in the UK alone, which effectively means
that their products will be shown to the correct people. However, the reliability of
the media research must be considered as the popularity of social media
platforms may differ by country and it is unknown when the research was carried
out, also questioning how valid it can be.
It is felt that a different objective that Decreal Gear should pursue to realise its
aim of increasing revenue is to introduce a loyalty scheme for its existing and new
customers. Decreal Gear’s primary market research has shown that 95% of the
people surveyed have expressed a desire to receive and participate in a loyalty
scheme, with an additional 99% interested in discounts. It is felt that Decreal Gear
should listen to the surveyed audience and introduce a loyalty scheme that would
,give customers discounts on certain products. This would help Decreal as people
would have an incentive to purchase their products, leaning towards gaining
more revenue, thus achieving their main goal. On the contrary, it is felt that
Decreal should consider the reliability of their own research as the survey only
questioned 100 people, which is a relatively small sample. This could have
misrepresented reality and provided Decreal with inaccurate information, which
is a problem as the research could make them pursue something that most do not
want. Furthermore, the validity of the research must also be questioned as the
audience surveyed were people between the ages of 17-35, which does not align
with the target audience of 25-35 that Decreal Gear has set. It is felt that the
survey’s results could have been wrongly influenced by younger people whose
thoughts do not align with the actual audience. It is felt that in the future, Decreal
could improve their survey through a larger sample and the correct audience. The
objective of introducing a loyalty scheme is, however, easily measurable as
Decreal Gear could record the number of customers before the loyalty scheme
and after the scheme is in place.
It is felt that a third objective of Decreal Gear to achieve increased revenue could
be to set a focus on manufacturing and selling women’s sportswear. Sportswear
sales have tremendously increased during the COVID-19 pandemic with a much
larger proportion of people participating in exercise. According to the secondary
research, women’s sportswear sales have grown by 43% between 2019 and 2020,
whilst men’s sales only increased by 18% in the same period. This shows that the
demand for women’s sportswear is much larger than that for men, and this could
be an USP for Decreal, although it must be given consideration as to how reliable
these findings are, since they were recorded during the pandemic and could have
altered by now. Additionally, between 2019 and 2020, women’s sportswear has
increased in price. From the secondary research, hooded tops went from £60 to
£68 and shorts from £32 to £35, whilst men’s products remained largely the
same. This, alongside with increasing demand, can be beneficial for Decreal as
more women will keep purchasing sportswear even for a higher price which can
lead to increased aim.
,The aim and supporting objectives are realistic to be achieved within the period of
30 weeks and with a budget of £20,000, therefore it is felt that they will help the
business increase revenue.
Research and Analysis of Market Information
It has been predicted that the sportswear market will increase in growth by 21%
in 2023, estimated to be worth £6.7 billion. This can be beneficial for Decreal Gear
as they can take advantage of the growing market and increase their own profits.
The growth is largely caused by an increased number of people participating in
exercise and the impact of celebrities/influencers in the promotions for various
sportswear. As a result, the demand for sportswear will simultaneously increase
which can alight a chance for Decreal to gain more profit and increase revenue.
According to secondary research conducted by Pi Datametrics, the most popular
products included loungewear, tracksuits, running shoes, and gym leggings. It may
be beneficial for Decreal Gear to sell these products to gain more revenue.
However, the reliability of this information must be carefully evaluated as there is
no information about when it was conducted. The data could be outdated as
trends around the world evolve at a rapid rate, which means that those products
may not be in the interest of people anymore. It is felt that Decreal should
consider this to avoid any mistaken manufacturing. It was said that Pi Datametrics
conducted these results based on the most popular online searches, however it
has not been said whether these results represent the UK or the entire world, and
search results will largely differ in each country. Therefore, the validity of this
research is not at its highest as it is unsure what real meaning these results have.
It is felt that the sportswear market is highly competitive with several strong rivals
that Decreal Gear must compete against to increase their revenue levels.
Secondary research has shown that some of these competitors are Nike, Adidas,
Puma, or Reebok which are all well-known brands, being established for many
years. It may be difficult for Decreal Gear to gain a competitive advantage over
the rivals mentioned as customers likely are connected to those companies
already. Adidas and Reebok have hired influencers to increase brand awareness
and appeal to the public, with Adidas hiring a Japanese designer Nigo who
,designed Human Wear products, and Reebok for which Victoria Beckham designs
various products. Hiring a specific influencer or a celebrity can largely Decreal
Gear and create their own USP, as that celebrity will only be associated with
Decreal. People with prominent levels of influence can persuade the public to
purchase products, which can result in increased revenue for Decreal Gear.
However, the cost of hiring an influencer must be considered because it is not
usually cheap, therefore it is important to calculate whether such a move will
bring profits or losses. Other sportswear companies, such as BAM, Contur, and
Tala, offer sustainable sportswear, showing care for the environment around us.
In recent years, there has been an increase in awareness surrounding the
environment and more people choose to shop from environmentally friendly
companies. Such an initiative can lure in more customers, resulting in increased
sales and revenue. It is felt that Decreal Gear could consider the addition of
sustainability to their product portfolio to appeal to a larger number of people.
Decreal Gear could also utilise certain methods, such as the mystery shopper, to
investigate their competitors and analyse their strengths and weaknesses. As a
result, Decreal could capitalise on those weaknesses by converting them into their
strengths.
Justification: SWOT
Strengths:
- Excellent reputation for quality (customer satisfaction)
- Clothing range is stylish (appealing to customers)
- Delivery is free and customers can return their products if they are unhappy
with them (customer service)
Weaknesses:
- Decreal’s prices are lower than average (loss on profits)
- Sales revenues at Decreal Gear have not grown over the past three years
- Decreal sells exclusively through its website
Opportunities:
, - Online purchasing has seen an increase, with 55% of the UK using the
internet for buying things
- The demand and price for women’s sportswear is increasing
- An introduction of sustainable clothing can appeal to more people as
environment is a rising issue
Threats:
- There are many competitors, so it is hard to stand out (Decreal Gear could
cease to exist)
- Gyms disrupted by COVID to open again (drop in home workouts)
Justification: PESTLE
Political – Governments regularly launch initiatives to encourage exercise and
healthy eating, especially targeting those who have not paid attention to exercise
previously. This can help Decreal Gear as more people will be looking to purchase
sportswear due to wanting to exercise, therefore increasing sales and revenue.
Economic – Uncontrolled inflation can greatly disrupt Decreal Gear. Prices will
increase and people will be more cautious with how they spend their money,
focusing on essentials such as food. This can result in the sportswear market
experiencing a dip, thus reducing sales for Decreal Gear. On the other hand,
according to the secondary research, demand is rising even though prices are
higher. Men’s sales have increased by 18% and women’s sales by 43%. This
demonstrates how the state of the UK economy has an insignificant impact on
whether people buy sportswear.
Social – Trends in society will always be changing and Decreal needs to be aware
of any unexpected alterations. Although, in recent years there has been a clear
increase in the number of people doing exercise and showing more care for their
health. This will result in more people buying sportswear and thus increasing
revenue. Events such as the COVID pandemic can cause large scale disruptions
that will substantially affect businesses. For Decreal, this has been positive as
people were forced to stay at home, which increased the demand for sportswear,
however not all social disruptions will have the same effect.
,Technology – Technological advancements are developing at much faster rates
than ever, with modern technology taking over the world one by one. This can be
beneficial for Decreal as they will be able to increase the amount and quality of
the products they make. This will result in more products being available thus
leading to increased revenues. However, it is possible that Decreal could fall
behind the ever-changing technology and lose to their competitors, fading into
irrelevance. This will have negative effects on Decreal as their sales will decrease
and the business may disappear.
Legal – it is crucial for Decreal to comply with any relevant laws and regulations
set by the government to stay out of any trouble. Failure to comply will have
negative implications on the business such as fines, suspensions, or even
imprisonment. Decreal will have to spend their money on easily avoidable legal
trouble, acting adversely to the main aim of generating revenue.
Environmental – there has been a significant rise in the popularity of sustainable
clothing, with companies such as BAM or Tala heavily benefiting from this societal
trend. Decreal could try to manufacture more sustainable clothing as it may
increase their sales, perhaps even using this sustainability as an USP to some
extent. Additionally, Decreal Gear could consider shipping their products with
recyclable packaging to further satisfy their customer base, and luring new
customers who will be impressed with this initiative.
Justification: Porter’s 5 Forces
Power of buyers – HIGH: As already established, Decreal Gear has many
competitors because the sportswear market is extremely competitive. Some
leading brands include Adidas, Nike, or Puma which are all well-known around the
world. Customers have a variety of choices when it comes to purchasing
sportswear and have a lot of power over businesses. Decreal Gear will therefore
be required to comply with what the customers want, at least to some extent.
This means that customers can easily dictate the prices. If a business wants to
make as many sales as possible, it will be required to make products cheaper. This
will result in a loss of profit, however failure to cooperate will lose them
customers and competitors will gain them instead.
, Power of suppliers – HIGH: Similarly to customers, suppliers will have a lot of
choice when it comes to choosing who they want to provide materials to.
Naturally, they will choose those companies who are willing to buy materials for
the highest price. This will be negative for Decreal as they will probably be
required to overpay, thus creating a lower profit margin. It is also important for
Decreal to create a great relationship with their supplier. If the relationship is
poor, suppliers may demand higher prices, further affecting the financial status of
Decreal Gear.
Threat of new entrants – MEDIUM: It is not easy to enter the sportswear market
due to multiple reasons. For example, it requires a lot of knowledge and research,
especially as to what is trending and what people want and, to add on, a large
amount of capital is required, which is not easy to acquire. Besides, the
sportswear market is incredibly competitive, so to find a USP or something to lure
customers with will be extremely difficult. Decreal Gear does not have to worry
about new entrants as they have already operated for four years. On the other
hand, the market has a lot of variety so new entrants can choose an area to focus
on that other businesses have avoided, potentially creating a USP. Plus, the
market for sportswear clothing is positive with a 21% growth in 2023, so there
perhaps is little room for error.
Threat of substitutes – MEDIUM: Sportswear products will always be popular and
in demand. As the research stated, the market is expected to grow by 21% and
both women’s and men’s sales have greatly increased which means that people’s
interest in sportswear is always high. This is good for Decreal Gear as their
expertise will always be wanted by people around the world. Conversely, current
sportswear may gradually be replaced by more sustainable clothing which has
been gaining popularity over the past few years. This shows how there exists a
danger for Decreal.
Competitive rivalry – HIGH: It is difficult to effectively stand out from other
businesses in the sportswear sector because there are so many of them, all with
their own USP’s and loyal customer bases. Consequently, Decreal Gear will find
