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OutlineOutline
Background
SWOT analysis
Current situation Key issues
Recommendations
Alternatives
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BackgroundBackground
Hoback Boot Company, founded inJackson, Wyoming
Began as a Western-style boot company
Inherited from parents (president- Margret& VP- Anthony)
Company was refocused to increase
revenues 1981 Hoback was renamed to Cima
Mountaineering
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SWOTSWOT
STRENGTHS Test hiking boots on trails
Discuss marketing strategies to increase profitsand increase sales
Sales & Profits have grown steadily
Anthony & Margaret (owners) grew up learningthe boot business
Quality emphasized throughout product line
Each line has different styles & features to covermany of the important uses in the market
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SWOTSWOT
WEAKNESSES
Growth has slowed down as a result from
foreign competition & a changing market Market wants more casual, stylish boot for
weekend hikers
Not much modification to the current boots Decided not to use mail order catalog
companies
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SWOTSWOT
OPPORTUNITIES
Market wants more casual, stylish hiking
boot for a variety of uses Ideas to extend the line & expand
distribution
Make boots at lower prices Light weight hiking boot for less
experienced hikers
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SWOTSWOT
THREATS Risk in new line of boots
New boots = new set of marketing,
competitive issues, and financing a newline
Asolo, Hi-Tec, Salomon, Raichle, Reebok,Nike, Vasque, and Merrell
Rocky Mountain Sports & Great WesternOutfitters dropped Cima and picked uptheir competitors (more to come?!)
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Current SituationCurrent Situation
Revenues are increasing but at a slowing rate
Cima is looking to expand but they cant decide whichalternative to choose
Losing business due to high prices Competitors are becoming increasingly popular with a
less expensive weekender style of boot
Cima currently only focuses on more expensive boots for
a medium to advanced level of hiker and climber Cima only sells using personal selling to specialty
retailers while their competitors sell through mail ordercompanies and chain sporting goods stores
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ProblemsProblems
Distribution
Price
Competitors Foreign
Domestic
Promotion Slow to moderate market growth
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ProblemsProblems
Distribution Currently, Cima boots are only distributed in Western
Canada and the Western United States
Only sell in 10 states in the US
Cima Mountaineering only sells their boots to retailersthat specialize in mountaineering, backpacking, andhiking equipment
Do not use catalogs Do not use sporting goods chains
Do not use internet
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ProblemsProblems
Competitors Foreign
Foreign companies exporting their boots aggressively intothe United States
Asolo, Hi-Tec, Salomon, Raichle marketed on performanceand reputation, usually to the mountaineering serious hikerand weekender segments of the market
Domestic Vasque and Merrell market boots that compete with Cima,
but are offering products for segments of the market whereprospects for growth are better
Reebok and Nike new entry to boot market-- appearance anddurability of hiking boot with the lightness and fit of athleticshoes-- expanding into markets that demand lower levels ofperformance
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ProblemsProblems
Price
Current prices are too high to reach some ofthe market
Losing retailers due to high prices
Great Western Outfitters replaced Cima withMerrell due to customers asking for lower-pricedboots
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ProblemsProblems
Promotion Cima needs to expand their promotion techniques
Personal selling
Print advertising
Trade shows
Point of sale displays
Only have 10 sales reps All independent and sell complementary equipment
Print advertising is only placed in backpackingmagazines Summit,Outside, Backpacker
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ProblemsProblems
Slow to moderate market growth
Mountaineers only make up 5% of the marketshare and are seen as having slow growth
Serious hikers make up 17% of the marketshare and are seen as having moderategrowth
They are in no high growth markets and onlyreach 22% of the boot market
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Key IssueKey Issue
How to expand the company in order toincrease growth and keep up withcompetitors
Management is torn on which expansionapproach to take
Expand existing Line
Develop new line
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RecommendationsRecommendations
Introduce a less expensive, more versatile CimaWeekender boot
Lightweight, comfortable, durable, versatile
Young to middle aged men and women
Recreational hikers, enjoy outdoors and spending time withfriends and family
Price range ($80-$100)
Benefits
Appeal to a new target market High potential for growth
Low prices while maintaining quality
Expand distribution
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RecommendationsRecommendations
Increase product distribution of all lines
Expand throughout the U.S.
Expand to chain sporting goods stores Dicks Sporting Goods REI
Gander Mountain
Distribute through mail order catalogs
Distribute through internet Allows customers to order on company website
Allow customers to order through retailer websites
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AlternativesAlternatives
We Chose not to expand existing bootlines
Smaller target market
Mountaineering and serious hikers only make up 22% of the bootmarket
Weekender boot market makes up 25% of the boot market
Less growth potential Mountaineering is a low growth market
Serious hiker is a moderate growth market
Weekender is a high growth market
Already have multiples styles in those brands Have three mountaineering styles
Have 5 serious hiker styles
If weekender brand proves successful, they can always
expand their existing boot lines in the future
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Questions?Questions?