I. IntroductionI.a. name of the corporation

I.b. background of the corporationI.c. the marketI.d. the product [why create the product; product introduction]

II. Environmental AnalysisTo fully assess the feasibility of the business idea of a fashion boutique shop for petite women, EALA Inc. has made two key environmental analyses: macro- and microenvironment analysis. The macro-environment analysis takes into the account the political situation under the Philippine government; the economic environment, which mentioned pertinent economic indicators that are relevant to the analysis of the market and described the current economic situation in the country; the cultural environment, which took note of important socio-cultural demographics to better understand the target market; and the technological environment, which listed capabilities that the local garments industry has as of the moment. On the other hand, the micro-environmental analysis focused on the garments industry in which the group wishes to enter. The analysis discussed the developments and issues in the local garments industry. In addition, as part of the micro-environmental analysis, the group considered the retail trade in the Philippines as well as possible competitors within the industry.

Macro-environment AnalysisPolitical EnvironmentThe country is currently facing political instability, as there is a desire to change our current political system to a parliament type, thus creating a pessimistic hype for some potential long-term investors because of possible negative political issues that loom ahead, which can cause economic tribulations. Not to mention the unending corruption issues of our politicians, the alleged election fraud and corruption charges against the president and her family, the dawn of

value-added tax resulting to higher prices, and the time-to-time resignation of the president’s economic team. Such political crises negatively affect the profitability of the country’s businesses due to rating outlook downgrades and higher interest rates. If debt levels continue to decrease and higher foreign reserves were maintained, there would be no major negative effect on business profitability.i

In the meantime, the country’s political crisis has brought international credit rating companies to downgrade the country’s debt payment credit ratings and also affected Asian Development Bank to threaten the country with suspension of loans if fiscal and other reforms remain stagnant if the political crisis would not be resolved.

The political crisis may not just negatively affect the country’s economic performance, but may also damage the confidence of the consumers and investors as well as hinder the developments in the financial markets. Ultimately, the political crisis only serves to aggravate the country’s external variability to global trends such as growth moderation, rising interest rates and oil prices. ii

Economic EnvironmentThe strong influx of overseas Filipino workers’ dollar remittances and increased tourism are the main economic drivers of the peso’s surge in 2005. At the end of the previous year, the peso had become one of the best performing currencies in the world, hitting roughly PhP 52.00 per U.S. Dollar. This is a proof that the Philippines is on a recuperating stage after a long suffering from a weak economic base as a direct result of political instability, higher interest rates, low credit ratings, and other economic performance risks. If the momentum from last year’s final quarter shall continue, it is projected that the Philippine Economic System will continue to anticipate a positive outlook and slow-but-sure growth.iii

However, basic commodities still has skyrocket-high prices and the living condition today is getting even worse. The lack of local job opportunities has also increased the trend of “brain drain” as more and more Filipinos seek jobs abroad. These further on result in a steady increase in the unemployment rate of Filipinos.

Major Economic IndicatorsGross National ProductAs of the third quarter of last year, the Gross National Product, at Current Prices, amounted to 4,150,771 million Pesos. There has been a 0.7 percent decrease in GNP, making the 2004 13.5 percent rate down to the current 12.8 percent.iv

Gross Domestic ProductBy the end of last year’s third quarter, Gross Domestic Product at current prices amounted to 3,836,727 million Pesos. As compared to the 14.1 percent GDP growth rate from 2004, there has been a big 3.7 percent decrease leaving 2005’s GDP down to 10.4 percent. However, it is expected to grow approximately by 5.5 percent this year. The expected growth in GDP in 2006 can be attributed to the growth in personal consumption, the recovery in government spending, and also the strong demand for export products.v

Personal Consumption Expenditurevi

Personal consumption expenditure is currently 72.9 percent of GNP, a decrease from last year’s 73 percent, experiencing an annual change of 5.8 percent.

Wage RateCurrently, the minimum wage rate in Metro Manila is currently pegged at PhP 288 to PhP 325 a day (eight working hours per day), the highest among the regions. However, there is an ongoing legislation in

Congress to increase the minimum wages to cushion the impact of the expanded value-added tax on workers. vii

InflationAs of the year ended 2005, Inflation rate rocketed to 7.6 percent from the previous year’s 6.0 percent - a 1.6 percent difference.viii The Bangko Sentral ng Pilipinas is targeting the inflation rate to average between four to five percent in 2006. The inflation forecast for the year, however, is placed at 7.5 to 8.2 percent. According to the BSP, there is little sign of any inflationary pressures building in the Philippine economy. The BSP Deputy Governor Diwa Guinigundo also said that the planned rise in the sales tax to 12 percent from 10 in February could cause an upward blip in inflation levels, but that would be short-lived. ix However, high oil prices will remain as the main threat to inflation this year, which have already taken some of the buoyancy out of consumer spending last year. But amidst the threats, the strong peso and easing food prices help balance inflationary risks.

Foreign Exchange RateAs the year opened, the Peso closed at its highest for the past eight months at roughly PhP 52.00 a Dollar. If the political situation slowly stabilizes, the country can experience a continuous lift in the peso. Factors that can strengthen the peso include political stability, income remittances from OFWs, inflows from portfolio investments, and proceeds from government bond sale.x

The 2006 Fiscal program assumed that the average exchange rate would settle at Php56.00 to a US Dollar, and that the benchmark 91-day Treasury bill rate would hit eight percent. xi

Value-added TaxThe month of February has been welcomed with the imposition of, the new 12 percent value added tax. Moves by the government to raise the level of value added tax (VAT) from 10 percent to 12 percent would

hit hardest the country's poor and its small businesses, the American Chamber of Commerce of the Philippines said. They also asserted that any increase in VAT would pose a serious burden on the country's poor and small to medium size enterprises and would also lead to greater tax avoidance. With the current minimum wage rates, it is highly doubtful if the Filipino wage earner could absorb price hikes to be triggered by the increase in VAT as well as other taxes. Employers likewise may not be prepared to incur additional expenditures particularly at this time of economic crises, concluded by the business group.xii

Socio-cultural Environment DemographicsPopulationxiii Population in the Philippines is increasing at a 1.84 percent growth rate and is now currently pegged at 87.9 million Filipinos. The highest concentration of people is found in the NCR, which is 12.98 percent of the total population, Southern Tagalog, with 15.42 percent, Central Luzon with 10.5 percent, and Western Visayas, with 8.12 percent.

The age structure of the population is divided into three brackets. The first one is from 0-14 years old, which include 35.4 percent of the population. The second bracket of ages 15 to 64 comprises of 60.6 percent of the population. The third age bracket, which is composed of Filipinos 65 years old and above, covers only 4 percent. The median age for males is 21.77 years whereas for females, it is only 22.8 years.

Based on the 2000 Census of Population and Housing taken by NSO, it was found that there were more men composing the population with 50.4 percent than women with 49.6 percent. From 1995 to 2000, the sex ratio was pegged at 101.4.

Labor Forcexiv

The total number of working people with ages 15 years and above is pegged at 54,797,000, an estimated 35,496,000 of which is included in the labor force, thus a 64.8 percent labor force participation rate.

The employment situation in the Philippines continues to improve with a recorded increase of 3.6 percent in the number of employed. There were 32.9 million reported employed this period compared to 31.7 million a year ago. Hence, the national employment rate is placed at 92.6 percent.

Starting April 2005, the new unemployment definition was adopted per NSCB Resolution No. 15 dated October 20, 2004. As indicated in the said resolution, the unemployed include all persons who are 15 years old and over as of their last birthday and are reported as (1) without work; AND (2) currently available for work; AND (3) seeking work OR not seeking work due to valid reasons. Data shows that 2,620,000 are unemployed, 48.8 percent of which were 15-24 years of age. Moreover, 61.6 percent of the total unemployed population were males while 38.4 percent were females.

Underemployment, on the other hand, is at 6,970,000 with a rate of 21.2 percent, a big jump from the 16.9 percent of the previous year.

According to the NSO’s Labor Force Survey, men and women comprise 61 and 39percent of the 2002 labor force, respectively. In addition, it was found that women had a 51.7 percent labor participation rate while men participated in the labor force at a rate of 80.8 percent. Employment rate for women was 89.9 percent whereas men’s employment rate was at 89.9 percent. In terms of major occupation groups, majority of professionals, clerks and officials and special-interest organizations, corporate executives, managers, managing proprietors and supervisors were women. On the other hand, majority of plant and machine operators and assemblers, farmers, foresters and fishers, and tradespersons were men. In terms of major industry

groups, more women belonged in the education, health and social work, and wholesale and retail trade industries while more men were found to be dominant in the construction, transportation, storage and communication, and fishing industries.

Consumption and Expenditure xv According to the National Statistics Office Family Income and Expenditure Survey Final Results released last January 12, 2006, the average income vis-à-vis the average expenditure of the Filipino family has been experiencing an increasing trend. Average yearly income increased from 145,121 to 147,888, a 1.9 percent uplift from year 2000 to 2003. The target market of the business, which is NCR, was one of the top three regions in terms of average income. The other two were CALABARZON and Central Luzon. These top three regions posted estimates of income that were higher than the average income of 148,757 pesos in 2003.

Average Expenditures are also escalating with numbers growing from 118,839 in 2000 to 123,690 in 2003 – that is a whopping 4.1 percent increase.

On a different note, the Average Savings are lessening. From the 26,282 average savings in 2000, it decreased to 24,198 in 2003, a 7.9 percent decline. However, on the average, Filipino families in all regions earned more than they spent, as stated in NSO’s 2003 Family Income and Expenditure Survey results. In 2003, families located in NCR showed the biggest annual saving of 46,923 pesos.

In 2004, personal consumption grew at a rate of 5.8 percent due to double-digit growth of income remittances. In the first quarter of 2005, there appeared a decrease in personal consumption expenditure, which can be attributed to higher prices of goods and services. There was a slowdown in growth for food, beverages, clothing and footwear, household furnishings, household operations, and miscellaneous

expenditures as well as fuel, light and water due to low electricity consumption. On the other hand, expenditures on transportation and communication increased due to rise in road and railway ridership and mobile phone usage.

Technological EnvironmentIndustrialization The manufacturing, along with the closely associated activities in the clothing and garment production, continues to be one of the driving forces of industrialization the world over. The clothing industries have fought to maintain their share of the total value that is created throughout the series of apparel design, manufacturing and distribution. xvi

AutomationAt present, technology in the garment industry here in the Philippines consists mainly of automation of the processes. These include the automated designing of the patterns as well as that of fabric laying and cutting. Electronically controlled mechanisms are also used for stitch formation and fabric feeding for the basic sewing machines. The last of the processes include automated machines and devices for pressing the clothes.xvii In addition, current developments in machineries include designs which enable fast adjustments of equipment from one style to another thus eliminating the non-productive handling of fabrics and garments. In the process, quality is thus being improved.xviii

Other DevelopmentsThe Garments and Textile Board of the Philippines has recently installed an Electronic Data Interchange (EDI) system to reduce processing time to help improve production and delivery lead-time. It allows garment manufacturers-exporters (GMEs) to transact with Garments and Textile Export Board (GTEB) electronically. The costs associated with implementation of EDI include the costs for acquiring the software and the hardware themselves, training and ongoing costs

such as Value-Added Network (VAN) charges, maintenance and support costs.xix In addition, the leading companies in the industry have started to acquire CAD/CAM techniques, “Quick Response”, and “Just in Time” philosophies to allow more flexible manufacturing.

Micro-environment AnalysisII.b.1. garments industry [historical background]

[research on Board of Investments of the Philippines regarding graph of top exports in comparison with other industries in terms of revenues]

III. Industry Analysis Porter’s Five Forces Model

BuyersClothing is one of the three fundamental human needs. Everybody needs to buy clothing. Clothing includes wearing apparel such as shirt, pants, among others.Pants, particularly denim jeans have been termed as the most popular wearing apparel on earth.1 This clothing product is worn by almost everybody thus, considering everyone as its consumer. However, buyers usually buy in smaller quantities and do not purchase regularly. Buyers can also easily switch from one competitor to another in case of product dissatisfaction or if they just want to try other brands.

Personal consumption expenditures in the Philippines have been fairly resistant to adverse changes in the past and in the current Asian crisis as well. Although spending on clothes as a percentage of income has been declining, percent total per capita expenditures on clothing have been increasing, representing 47 billion pesos in 1997, a growth rate of nearly 12.6 percent from 1991 to 1997.2

1 A Short History of Denim 2 Cotton Textile and Apparel Products

Jeans customization is somewhat an old concept because of the proliferation of tailoring shops. These shops cater buyers who can be dissatisfied with the jeans available in the market or who just wants to alter a jeans bought from a certain store. However, the idea of custom-fit jeans is still a fresh concept in the garments industry, particularly in the Philippines. Only few buyers, particularly those in the upper class, avail/can avail these products because of the products’ perceived high-end status and high price.

SuppliersDenim has always been made of cotton. Philippine raw cotton production supplies less than 3 percent of total domestic cotton requirements, thus Philippines manufacturers continue to rely on imports to meet domestic demand. The United States is likely to remain the largest supplier of combed cotton, followed by Pakistan, Australia and South Africa. With the end of the quota system for garments starting in 2005, domestic cotton consumption is forecast to decline next year. The garments and textile sector is the single largest buyer of raw cotton and the garments sector is country's second highest export earner.3

New EntrantsBarriers to entry include global and local policies implemented in the textiles and clothing industry, capital requirements, access to distribution channels, product differentiation, and cumulative experience, among others.

For instance, the World Health Organization (WHO) Agreement on Textiles and Clothing (ATC) took effect on January 1, 1995. Under its provisions, the US negotiated market access with several developing countries, including the Philippines, which are major exporters to the US market. The Philippines agreed to improve access to its market. Under this agreement the Philippines is obligated to reduce and bind

3 Philippine Cottons and Products

tariffs, and to reduce and eliminate non tariff barriers. In line with its commitments, the Philippines have bound its textile and apparel tariffs at the following rates: 20 percent for yarn, 10-12.5 percent for man-made fibers, 30 percent for sewing thread; 30-50 percent for floor covering, and 30 percent for textile made-ups. Under its WHO obligations, the Philippine Government initiated a general tariff reduction program to reduce tariffs on raw materials to 3 percent and on finished goods to 10 percent by 2003. In January, 2004, the Government plans to introduce a uniform 5 percent tariff rate.

Another instance is Value-Added Tax applied to all imports, assessed at 10 percent of the value of goods, plus duty.

The Philippines is a member of ASEAN and a participant in the ASEAN Free Trade Area (AFTA). AFTA contains a preferential tariff scheme (CEPT) which requires intra-regional tariffs to be reduced to 0-5 percent by the year 2003. Textiles are on a fast-track schedule for tariff reductions to 0-5 percent by the year 2000. CEPT also requires intra-regional reduction in non-tariff barriers and harmonization of customs procedures and product standards.

The Philippine Government provides incentives to promote investment in preferred activities and geographic areas and for export. Investment incentives include: income tax holidays; tax deductions for labor expenses, infrastructure, capital equipment and spare parts, and investment in less-developed areas. On the other hand, export incentives include: exemption from advance payment of customs duties; tax credits for imported raw materials and spare parts, domestic substitution of imports, export revenue; and various exemptions for duty on imports. A variety of financing programs and guarantee schemes is available through state-sponsored institutions.4

4 Cotton Textile and Apparel Products

Capital requirements include high-speed and highly-efficient sewing machines, high-quality denim fabric, among others. Human resources in the form of tailors are also essential in this business.

New entrants will not find it difficult to meet distribution network requirements since there are various alternative channels for them to sell their products. New entrants can easily distribute their products without having to invest in creating new distribution networks.

Product and service differentiation requires vast outlays in several stages of the value chain, most especially in advertising and promotion.

Learning curve effects make a difference as companies with more experience gain advantage through having more cost-efficient manufacturing processes.

Substitute ProductsReady-made retail products are considered substitutes for custom-made clothing. Moreover, denim pants could be replaced by shorts and skirts as bottom apparel. The denim fabric could also be replaced by other fabrics such as those used in khaki pants and slacks.

Industry CompetitorsThe Philippine garment industry dates to the 1950s and the emergence of cottage-level industries that replaced homework. As the industry began exporting during the 1970s, it experienced rapid growth, growing an average of 30 percent between 1972 and 1980. The industry is at a crossroads of uncertainty regarding the effects of global trade liberalization. It is expected that the removal of quotas will cause further erosion in the industry, with only larger, well-capitalized firms able to survive.5

5 Cotton Textile and Apparel Products in Philippines

The garment industry is comprised of many players, both operating on a large scale and small scale basis. The industry is a growing one; exports of garments are steadily increasing too as more foreign companies continues to trust the skills of local manufacturers in producing quality garments. The local garments and textile industry is the country's consistent second top performer in terms of export revenue. The Philippines is also one of the main product suppliers for high-end clothing brands such as GAP, Old Navy, Ann Taylor, Liz Clairborne, and Polo Ralph Lauren.6

Customers are free to change their suppliers thus creating high uncertainty for competitors. In terms of origin and operating styles, competitors may range from boutiques, specialty stores, bazaars, tiangges, direct selling agents, department stores to big malls.

A relatively large amount of money is tied in equipments such as high-speed sewing machines and inventories, but liquidating such assets is relatively easy.

IV. Competitor Analysis [EARVIN]IV.a. competitor mapIV.b. competitor profiling

[determine direct competitors Viktor jeans and tailoring shops; research on background and strategies]

IV.c. price profileIV.d. competitor SW analysis

V. Marketing Research

6 Behind the Seams http://www.philippinebusiness.com.ph/archives/magazine/vol11-2004/11-/forecast.htm\

In order to gather relevant and sufficient data for this feasibility study, EALA Inc. devised a market research instrument, in the form of a self-administered survey, on the jean-preference and buying behavior of the target market.

EALA Inc. sought the help of a statistician in the person of Ms. Sunshine Ong, a BS Statistics graduate from the University of the Philippines- Diliman, to aid

i “Philippine Political Crisis Could Hurt Business Profitability.” [Online] Availablehttp://en.ce.cn/World/biz/200507/14/t20050714_4189155.shtml, July 14, 2005.ii “Rating Firms’ Outlook on RP Turns Negative.” [Online] Availablehttp://www.bworld.com.ph/BW071205/topstory.php, August 2005.iii “Business Upbeat on Economy”, B5 Business Section, The Philippine Daily Inquirer, January 25, 2006iv “National Accounts Third Quarter 2005” [Online] Availablehttp://census.gov.ph, January 11, 2006v “Selected Economic and Financial Indicators.” [Online] Availablehttp://www.bsp.gov.ph/statistics/sefi/sefip1_files/filelist.xml, August 2005.vi “Selected Economic and Financial Indicators.” [Online] Availablehttp://www.bsp.gov.ph/statistics/sefi/sefip1_files/filelist.xml, August 2005.vii Gil C. Cabaccungan, Jerome Aning, “Palace: It’s Time Congress Enacted Wage Increase”[Online] Availablehttp://news.inq7.net/nation/index.php?index=1&story_id=55347, November 3, 2005viii “Economic Statistics.” [Online] Availablehttp://www.philippinebusiness.com.ph/economic_stats/economy.htm, August 2005.ix “Inflation Seen to Remain Stable”, B5 Business Section, The Philippine Daily Inquirer, January 25, 2006x “Worst Over For Philippine Debt, Says Poll; Peso, Stocks Up.” [Online] Availablehttp://money.inq7.net/topstories/view_topstories.php?yyyy=2005&mon=07&dd=19&file=1, July 19, 2005.xi “Government Expects Billions in Savings” The Philippine Daily Inquirer.January 23, 2006

in the development of a research instrument, selection of a suitable sampling method, and processing of relevant statistical data.

VI. Sampling Plan [ANNA]VI.a. mode of sampling [cluster sampling]VI.b. determine marketVI.c. identify persons surveyedVI.d. 3 clusters [Katipunan, UP Village, Blue Ridge]

VII. Market Demand Forecast [ANNA]VII.a. consumption rate

xii “Increase in VAT will hurt poor, small businesses”. [Online] Availablehttp://www.inq7.net, January 27, 2006xiii “Philippines Population Expected to Reach 100 Million Filipinos” [Online] Availablehttp://www.census.com.ph, October 16, 2002

xiv “Philippine Labor Force Survey” [Online] Availablehttp://census.com.ph, October 2005xv “Family Income and Expenditure Survey” [Online] Availablehttp://www.census.com.ph, January 12, 2006xvi Byrne, Chris. “The Impact of New Technology in the Clothing Industry: Outlook to 2000” [Paper]xvii “Clothing Engineering.” [Online] Availablehttp://www.fs.uni-mb.si/en/study/ects/IP%20-%20Clothing%20engineering.pdfxviii Dueñas-Caparas, Ma. Teresa. “State of Competition in the Wholesale and Retail Sector” [Paper]xix “Electronic Data Interchange – A Management Overview.” [Online] Availablehttp://66.102.7.104/search?q=cache:JAUTozWtU_4J:www.unece.org/trade/untdid/download/r1222.pdf+GTEBNet+EDI+costs+OR+fee&hl=en&client=firefox-a. August 2005

VIII. Supply Analysis [EARVIN]VIII.a. current supply of competitors

IX. Market Share [BASED ON SURVEY]

X. Sales Forecast [BASED ON SURVEY]

XI. Market SegmentationThe distinction of one segment from another in terms of needs, characteristics, interests and values necessitates dividing the market into segments, as these differences will greatly influence the responses and attitudes of people towards the products and services offered by EALA Inc..

Market segmentation was conducted in order to select the group of people who will be most receptive to the products and services offered by EALA Inc..

The market for consumers was segmented based on their geographical, demographic, psychographic, and behavioral indicators that influence their purchases for jeans.

Geographic SegmentationEALA Inc. subdivided the market into location-based segments (residential areas within a XX-kilometer radius from the location of the proposed business) because consumers’ wants and product usage are often related to one or more of these subcategories. Also, this geographic measure is measurable and accessible.

The distribution of population in these areas is important to the company because the market within these areas generally tend to share similar values, attitudes, and style preferences. Despite the

similarities, significant differences still exist among these residents because of differences in their culture, social customs, upbringing, and other factors. Hence, other factors need to be considered.

Demographic SegmentationDemographics was also one of the indicators considered by Pantsaloon. The most popular combination of factors include age, family, life cycle stage, income, occupation and education.

AgeEALA Inc. segmented the market to cater to 17 – 29 year-olds. The reason for this is that this segment shows the highest demand for Pantsaloon’s products.

Primarily composed of college students and young, urban professionals (yuppies), this age segment is the most prominent user of jeans. With a myriad of jean brands in the market, catering to college students and yuppies appear to be one of the most lucrative trends in the jeans industry.

IncomeThe consumer’s level of income is an important factor in the profiling of Pantsaloon’s market, as income is an effective indicator that reflects the buying power and spending habits of the students and yuppies for whom the products are made for.

The growing purchasing power of this age bracket is the primary factor making this age bracket attractive. For yuppies, the trend is being fuelled by higher disposable incomes resulting from more generous allowances and salaries. On the other hand, college students opting to work part-time during schooling, and heightened media awareness augments their purchasing power.

Life Cycle Stage

People’s demand for goods and services change over time to adapt to their likewise changing needs and want. Hence, there is a need to segment the market based on their current life-cycle stage.

A bachelor, having no family to support and most probably still under the custody of his parents, is more inclined to make purchases for himself, and clothing is definitely included in his expenditures. This being the case, the Bachelor stage seems to be the most appropriate for the product Pantsaloon offers. Young, single, individualistic and independent, the Bachelor is definitely made for Pantsaloon.

Occupation and EducationPantsaloon segmented the market to college students and young professionals. For the purpose of embodying what the individualistic youth is, this segmentation is important because Pantsaloon’s products and advertising will be more concentrated on them.

Psychographic SegmentationThe types of products and brands an individual purchases reflect that person’s characteristics and patterns of living. Pantsaloon, in evaluating the psychographic segments of the market, divided the group based on personality characteristics, lifestyle, and values. These attributes were examined and eventually related to how an individual in the market thinks, feels, and behaves.

Personality CharacteristicsThe college student and yuppies market is a dynamic and extremely competitive environment. Though there are plenty of opportunities for new entrants and a great scope for innovation, the target audience is extremely hard to please.

Media influence, including fashion, television, the Internet and music, make the market savvy about what they want. Quality will unlikely be compromised, and approach to brand loyalty is erratic

However, the nature of Pantsaloon’s enterprise being customization, it won’t be difficult for the business to keep up with the market’s unpredictability. Changing fashions won’t be much of a problem, as jeans have become a staple piece of clothing, and only their styles change through time. This quick shift from one style to another is a strength that Pantsaloon can play up.

Having the products and services evolve with the moment, together with extensive and focused marketing efforts, Pantsaloon hopes to retain the interest and loyalty of the market in consideration.

College students and yuppies, at their young age, are attracted by fun, glamorous and distinctive brands. Finally, while they have a strong desire to be like everyone else, they still have a very strong need to express their individuality.

LifestyleAs mentioned previously, the target market combines a desire for belonging and a need to express their uniqueness. Joining the bandwagon is prevalent among them, with cliques and barkadas being a common thing in this age bracket. In fact, people are usually first identified with the group of people they hang out with before they get to be recognized as individuals.

The trends dictated by society, media, and the people around them influence their lifestyle and behavior, and being updated with the latest in fashion, music, movies, electronic gadgets and the like is as important as expressing their individual selves.

Behavioral Segmentation(will be based on survey results)

Occasions Most college students purchase clothes, i.e. in this case, t-shirts, when they most have money. Out of 824 valid respondents, they buy their shirts during the 2nd and 4th quarter months (April, May, June, and October, November, December), as indicated from the market survey conducted. Below is a graph of the number of college students buying t-shirts divided into quarters.

June is a month when classes usually start. It is reasonable to conclude that most likely, they would buy shirts to wear throughout the new school year. The Christmas Season occurs during the month of December. Gift-giving is prevalent and monetary presents are given. Thus, giving our target market more money to spend, and more reasons to purchase t-shirts (as a gift, for instance).

Benefits SoughtThe graph below indicates the importance of several characteristics considered by college students in buying a t-shirt. 5 is considered most important while 0 means not considered at all. Most important benefits sought are wellness of fit, type of fabric, and design of prints. Ranking next are price and style of shirt. Price, on the other hand, is not very important to them.

Usage RateThe level of usage college students make of t-shirts is HEAVY. According to the survey conducted, 52% purchase 2-5 shirts on a 6-month basis, 30% purchase 6-9 shirts, 8% purchase less than two shirts, 6% purchase 10-13 shirts, and 4% purchase more than 13 shirts.

User Status

Much like everyone else, college students are jean regulars. Jeans, classified within the clothing category, are commodities/necessities that are a part of their everyday life.

Yuppies on the other hand, wear jeans less often, relative to the younger college students. However, as part of their “self-centered” lifestyle includes going out often, jeans are still a staple in their closets.

Loyalty StatusAs stated earlier, this particular age bracket is erratic and unpredictable in their approach to brand loyalty. Categorized as “Switchers”, they do not automatically seek out a particular brand, but more often purchase the brand available to them or that which caters to their taste and preference.

(also survey-based)

Buyer Readiness Stage88% of the respondents of W.I.T.’s market survey indicate that they are willing to buy the concept t-shirts W.I.T. offer. This segmentation model will be particularly useful in formulating and monitoring the marketing communication strategies W.I.T. will employ to move consumers towards purchase of a product or brand.

XII. Market TargetingPantsaloon, as a customized and tailored-to-fit jeans boutique, will focus on the needs of our market specifically as follows: (1) upper class male and female residents near our location (Katipunan area, Loyola Grand Villas, La Vista, Loyola Heights, Blue Ridge, White Plains, UP Village, etc.); (2) male and female students (specifically college students from Miriam College, Ateneo de Manila University and University of the Philippines-Diliman); and (3) young male and female professionals not more than 29 years of age.

EALA Inc. subdivided the market into location-based segments (residential areas within a common radius from the location of the proposed business) because this geographic measure is quantifiable and accessible. The distribution of population in these areas is important to the company because the market within these areas generally tend to share similar values, attitudes, and style preferences, given that they are in the same level of social class. Despite the similarities, significant differences still exist among these residents because of differences in their culture, social customs, upbringing, and other factors. Hence, other factors need to be considered.

College students, specifically from Ateneo de Manila University and UP-Diliman, do not have school uniforms. Thus, denim jeans have been a staple clothing item for them. But with different body structures as well as different tastes in denim jeans, Pantsaloon aims to address their dilemma on those differences. Furthermore, individuality is important to these particular individuals, thus Pantsaloon’s concept of customization would definitely cater to their need of distinctiveness. Miriam College students, on the other hand, are known for their flair for fashion thus, including them as part of Pantsaloon’s market.

Young professionals also have this need of uniqueness and standing out among others. They make sure that they are distinctively different from others, whatever it takes. Having their own source of income lets them address this need.

Pantsaloon custom-fit jeans cater to both genders—male and female. Though females are more known to be fashionable and vain, males nowadays are also into fashion. Metrosexuality has been a coined term for males that address their feminine side—the need to look good.

XIII. Market Positioning [EARVIN]XIII.a. positioning statement

XIII.b. meaning of brand

XIV. Marketing Mix [EARVIN / BASED ON SURVEY]XIV.a. price [based on survey]XIV.b. productXIV.c. placeXIV.d. promotions