Management Development Institute Od Singapore

Name                        : Lim Yi Xian

Fin NO.                : G1503952W

Course                : Advanced Diploma in Business Management

Module                : Marketing Management

Lecturer                : Mr. Roland Kiew

Contents

Introduction        

The North Face        

Customer-Focused Strategies        

Market Segmentation        

Target Market        

Market Position        

The Marketing Mix of The North Face        

Product and Customer Solutions        

Pricing Strategies and Consumer Cost        

Promotion Strategies and Customer Communication        

Place Strategies and Consumer Convenience        

Conclusion        

References        

Introduction

Customer plays an important role in the business cycle. Without customer an organization will not be able to survive and not even mention about making profit. In order to make profit, companies must always satisfy their customer. It is necessary for every organization to create a customer focused culture. There are numerous reasons why more and more organizations are using the customer-focused strategies. The simplest of these is that it gives them a better understanding of the customers’ needs and wants. To reach the pinnacle of success, companies must first be more focused on delighting customers and then on making profit. When the customers are happy, they will keep buying from the companies. It is a key indicator of customer’s repurchases intentions and their loyalty. Repeat customers mean more profits from the same person. The organization can spend lesser money and time to find new customer. The satisfied customers will also recommend the product to the people in their life; this will boost the company’s reputation. Employees play a vital role in customer-focused strategy. According to the book “Essentials of Marketing” by Charles W. Lamb; For example, your customers might only ever interact with one person from your organization, meaning the quality of a customer's experience depends on the actions of one member of your staff. Any employee who fails to represent your customer-oriented values jeopardizes your overall business strategy. It is important to ensure that every employee is on the same page when it comes to providing customers with a satisfying experience.

The North Face

The North Face is an American outdoor product company which specialize in outerwear, coats, shirts, footwear and equipment such as back packs, tents sleeping bags. The North Face first started the business as a San Francisco-based climbing equipment retail store in 1966 by Douglas Tompkins and his wife Susie Tompkins. The North Face has developed a superior reputation for quality, performance and authenticity by providing technically advanced products capable of withstanding the most extreme conditions. For nearly 30 years, the Company's outdoor apparel and outdoor equipment have been the brand of choice for numerous high altitude and polar expeditions. For a time, the company offered only highly selective merchandise, targeted to climbers and backpackers. By the 1980s, skiwear was added, followed by camping equipment. Through the production of the new product - ULTRA GORE-TEX®, The North Face captures the market.

Customer-Focused Strategies

Market Segmentation

North Face used many different ways to segment the market. Demographics are one of the most important factor when comes to segment the outdoor sporting equipment market. They include age, race, buying power, occupation and other factors. Most of the customers like outdoor activities and extreme sports. They are young, single and originally mostly male. However, there are more women are joining the outdoor activities. Because of this trend, North Face took the opportunity and started to produce women shoes. A further study shows that 55% of buyers are in the age range between 18 and 35, 40% of them are within 35 to 50. Buyers’ age below 18 or above 50 is only take a small part of the market share, 5% overall. The company also uses geographic variable. It segments customers by large metropolitan areas, such as Los Angles, New York City and San Francisco. The company also operates in several Europe countries and Asia countries. Currently, they are trying to re-segment their casual sportswear apparel market. While attempting to keep the original extreme athlete, they now use some other variables in order to decide who to target. The North Face kept the geographic segments similar to the original ideas. However, there has been a shift in demographic variables that use to segment the new market. Now, the market is segmented to include non- athletic customer and also active professionals. The buying power variables are also been modified, it became more price oriented in the market.

Target Market

Extreme sports equipment market has been a niche market for the past few decades. Not much people are interested in extreme sports, such as hiking and skiing. Knowing that most outdoor equipment and apparel manufacturer were targeting hobby oriented consumer, The North Face became a market nicher. Targeting climbers, mountaineers, extreme skiers, snowboarders and explorers. It targeted mostly Generation X and early Generation Y individuals. The North Face grounded it for targeting individuals that can afford the benefits the company put in so many efforts and invests in research and development. Since the target market consists of rich extreme athletes, The North Face provided high quality at a high price. At present, The North Face is attempting to expand from the original extreme sport equipment market to a casual sportswear market. The new market includes the extreme athlete and the new target individuals who use sports as a pastime rather than a way of life. But, these people are more price-sensitive and wear it as a fashion item. They not so care about how well the product is or how the features will do. Thus, The North Face tries to bring both the original market- the extreme athlete and the new expanded market into unison. They strengthen both markets need and put it in their products.

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