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Ann Starr Fashion Shop
Presented by:
Philadelphia, 1947
The Ann Starr Fashion Shop
Mrs. Ann Starr
The 40’s
The 50’s
The 60’s
Ann Starr’s Clientele
Two decades later…
Ms. Laura Taylor Laura’s Designs
The Hillman Chain
There were many women with expensive
tastes and limited funds, and who always
wanted the newest "look“, but only if it
had been copied in a lower price range.
The Problem
• Hillman bought property exactly opposite to Laura’s store.
• Priced the items 20% lower than the same brands in department and specialty stores.
• Competitive price strategies were not Laura’s strong suit.
Laura’s Options• Cut down her prices (and maybe the quality
of her services and products as well)• Aggressive, intensive advertising• Ignore Hillman’s strategies• Sell off her business
Filene's Basement, Boston
• Entire stock made up of merchandise bought in lots from the finest manufacturers and retailers in the world.
• Everything bought at the lowest prices, so selection was less.
The affluent and not-so-affluent rubbed shoulders while looking over the vast assortments brought together by the
management of Filene’s Basement.
The Questions
• Should Laura adapt the ‘Filene's Basement approach’?
• Should she forget the merchandise plan that had been the basis for her success for so many years?
• Where would those customers who wanted selection and service go?
• Would she lose or gain in trying to compete directly with Hillman's?
The 7 P’s
The 7 P’s
STP & Competitors Analysis
Segmentation
• Desired Benefit: Latest Fashion Outfits for fashion conscious
customers • Buying Frequency:
One time buyerOnce a month buyer
• Awareness: FamiliarUnfamiliar
Targeting
• Targeting people of:Only femalesHigher income groupUrban PeopleFashion Conscious shoppersUpper middle class and Elite class peopleEducated /Uneducated
Positioning
• Product differentiation:In Trend products (Latest fashion) Creative Display of Products Most complete assortment of women's
fashion wear Surety of sizes, colours and styles Friendly, courteous, knowledgeable and
Trained staff
Competitor Analysis
SWOT AnalysisStrengths:•Creative displays
•Courteous & knowledgeable staff
•Customer Loyalty
Weakness:•Huge markup
•Limited offerings
•No advertising
Opportunities:•Feline’s Basement Approach
•Mass Advertisement
•Purchase from retailers
Threats:•Hillman’s Store (or any other new entrants)
•Possibility of Client Switch-over to the competition
Ann Starr
• Reputed fashion store• Recently faced with competition from
Hillman’s• Laura considering strategies to tackle the
competition.• SERVQUAL could help Laura in finding gaps in
anticipated and current service model
Should Laura Taylor engage in price competition with
Hillman's ? Why ?
What are the advantages and limitations of price competition? Non price
competition ?
Price CompetitionAdvantages
• Out perform competitors.• Gain market share.• High inventory turnover.• Can be used to attract
customers from competitors.
Limitations
• More time is needed to conduct and update market research.
• Competitors can easily mimic whatever price you select.
• Company may suffer losses.• Does not help building loyal
customer base.
Non price competition
Advantages• Premium price can be
charged.• Profit margin is high.• Target market is clear.
Limitations• Company expenses
increases on advertising, selling staff, sales promotions, coupons, special orders or free gifts
Should Laura Taylor engage in price competition with
Hillman's ? Why ?
No !!!
• Hillman had advantages in many areas over Ann Starr.• Hillman’s product procurement concept.• Nine outlets as compared to one shop of Ann Starr.• Potential customer available for high price taste and
service.• Expense of advertising can nullified by increase in
sales. • Exclusive women’s shop with 50% markup.• Her displays were the most creative in town. The Ann
Starr staff was well-known for its courteous, knowledgeable treatment of customers.
Filene's Basement
• Stock made up of merchandise bought in lots from the finest manufacturers and retailers in the world, both in terms of quality and assortment, it was able to buy everything at lower prices
• The Basement store occasionally secured merchandise from Filene's "upstairs" store and branches
• The differences between Hillman's and Filene's Basement were primarily differences in resources, timing, and selling strategies
• Filene's Basement was even Iess selective and, therefore, got better deals
• All other odd sizes and colors in the lines were purchased by Filene’s basement
Filene's Basement • Famous fashion stores like Neiman-Marcus in Texas and Bergdorf
Goodman in New York were regular suppliers • Customers were able to buy $300 designer dresses and $350
designer suits for half price• When merchandise was first placed on the selling floor, it was given
prime space• Merchandise that was left after twelve days was moved to a less
important table location on the floor while the new arrivals took over the prime spot
• From this second location the left-overs were again moved to a third area
• With each move, prices were reduced until finally the items that remained were given to charitable organizations
Is it feasible for Laura to adopt a version of the Filene's
Basement concept ??
YES !!!
• Competition is inevitable• She can still be able to operate one-half of the store as an
exclusive dress shop and the other half as budget shop• She could limit her sources and buy only from retailers in
her geographic region, eliminating manufacturers completely
• Advertising - increased income would support an increased promotion budget
• With only one store Laura was sure to pay more for the same group of merchandise and paying more meant either higher prices or a lower markup
Service Blueprint
Thank You