Executive Summary North Face, a retail and manufacturing corporation of outdoor apparel and equipment, is attempting to become a leader in the casual sportswear and outdoor sports equipment markets. The Company now serves a larger market of casual sportswear market, rather than the specialty market it originally targeted. By moving into the larger market, North Face is hoping that it will be able to gain greater market share and profits from an expanding market. The Company has a greater asset that it should use to its benefit to acquire the proper demand.
Since being bought by Vanity Fair, The North Face has being able to surpass its financial woes and improve its profits. North Face should continue to use Vanity Fair Corporation's resources to ensure the expansion to its new target (See exhibit 3 for further financial analysis). Through the production of the new product line, the A 5 Series, North Face can capture this new market. The product is created from cotton and it is a transformation of typical bouldering apparel to a more casual attire for a less extreme athlete. However, North Face is not correctly marketing the product in order to create the proper demand for the A 5 line. Through changes in the marketing mix, North Face would be more successful in the casual outdoor sportswear attire.
North Face's Mission Statement and Goals Our mission is to profitably increase the North Face market share and brand awareness in all retail channels by: o Showcasing the depth, breadth and quality of the North Face products in all retail business segments o Marketing products and lifestyle to enhance the North Face brand image and reputation in each retail channel o Delivering a consistent company message of technology, innovation, and education through all retail environments o Establishing and maintaining the highest levels of customer service and product knowledge in specialty retailing o Providing a launch vehicle and testing ground for the company's new products and marketing programs o Supplying customer feedback to the company on all products, services, and marketing programs o Creating an environment for personal growth through coaching, education, and incentives Organizations History In 1966, two hiking enthusiasts founded a small mountaineering retail store in the heart of San Francisco's North Beach. The Company soon became known as The North Face, a retailer of high-performance climbing and backpacking equipment. The name was selected because in the Northern Hemisphere, the north face of a mountain is generally the coldest, iciest and most formidable to climb. In 1968, The North Face began designing and manufacturing its own brand of high-performance mountaineering apparel and equipment, and in the early 1980 s, extreme skiwear was added to the product offering. By the end of the decade, The North Face became the only supplier in the United States to offer a comprehensive collection of high-performance outerwear, skiwear, sleeping bags, packs and tents.
Spring 2003 marks the introduction of A 5 Series TM apparel for a generation of climbers and athletes who know no boundaries between sport and a way of life. Cotton fabrics with casual cuts and functional features are blended into comfortable, free spirited designs. Bouldering inspired, A 5 apparel is great for climbing, but still has enough of an urban sensibility. Now, 37 years after its origin in the outdoor industry, The North Face provides an extensive line of performance apparel, equipment and footwear. Offering the most technically advanced products on the market, The North Face is the choice of the world's most accomplished climbers, mountaineers, extreme skiers, snowboarders and explorers. The North Face is committed to pushing the limits of design, so that you can push your limits outdoors-never stop exploring.
Marketing Environment of the Product Line The North Face's competitive environment originally was targeted at satisfying the needs of a particular niche, the extreme athlete; thus, North Face was a market leader in serving the specialty market. However, North Face's expansion to a broader market has changed its competitive environment. To compete with the casual sportswear manufactures, North Face has created the A 5 series line, which will allow the company to establish itself as a mainstream sportswear manufacturer. With the development of the A 5 product line, North Face has entered into a very competitive market in which the participating firms have a similar goal of becoming a leader. North Face's competitive edge lies in producing items that are durable and can withstand the rough outdoor environment.
Moreover, the pricing of this casual outdoor apparel is similar to that of competitors. The prices enable North Face to compete in the casual outdoor sportswear with its main competitors Gore-Tex and Prana. The first company that poses competition to North face is Gore-Tex, which has its own casual wear line. Gore-Tex is in the higher price range, but they promise to be "highly technical, high-performance materials that have been proven time and time again to be the very best products of their kind." North Face has products that serve the same market segment as Gore-Tex; thus, making them competitors. In comparison to North Face's A 5 line, Gore-Tex's clothing has more of a city- wear attire orientation.
This brand has established itself as a company that will keep its customers "Dry." Similarly, North Face's A 5 series line is manufactured from cotton in order to make the products more durable and breathable and thus compete. The second competitor, and the most significant, is Prana. Prana produces outdoor clothing that is targeted and marketed to the same segment that North Face is attempting to reach. Their product line resembles that of North Face's A 5 series. Prana's clothes, like North Face' A 5 series line, provides the customer with versatility since the clothing can be used for outdoor activities or for lounging. Prana, according to John Procter, is North Face's primary competitor because of its historical eleven years serving the casual sportswear market.
In addition, Prana also prices its casual sportswear products similar to North Face's A 5 line series, which intensifies the competition between the two firms. For instance, Prana's clothing line ranges from $19. 99 to $85, much like North Face. Other companies that are in the active outdoors consumer market are Sierra Design, Patagonia, and Mountain hardware.
However, even though these companies serve the same market they offer different conceptions of quality, price and performance. Since North Face is founded in the idea of quality and high performance, it is logical that Prana has become North Face's main competitor because Prana also offers the promise of quality and high performance. Furthermore, pricing has become an important factor in competing with Prana; their pricing strategies parallel each other creating further competition. North Face's competitive advantage relies on brand loyalty, which it has established by creating customers with high quality products.
In expanding to a new market, North Face hopes that its "brand loyalty" will help them compete in the casual outdoor apparel market. Market Segmentation: North Face used several different ways to originally segment the market. Demographics are considered when segmenting the outdoor sportswear market. Most of the extreme athletes are young, single, and originally mostly male. However, currently, more women are joining extreme sports. Another variable considered is income level.
The market for the sportswear apparel is affluent and can afford the high quality products. The psycho graphic variables are also important; extreme athletes are portrayed as being fun loving and adventurous. North Face also has international geographic segmentation. North Face also uses a geographic variable; it segments customers by large metropolitan areas, such as Los Angeles, San Francisco, and New York City. The company operates in Europe and Canada, however it assumes similarities between extreme athletes across the world. Currently, North Face is re-segmenting the casual sportswear apparel market.
While attempting to keep the original extreme athlete, it now uses some other variables in order to decide whom to target. North Face kept the geographic areas similar to the original idea, still mostly caters to the large metropolitan areas. However, there has been a shift in the demographic variables that is using to evaluate the new market. Now, the market is segmented to include older non-as athletic individuals and active professionals. The income variable has also been modified; the segmentation of the casual apparel market is still well off but more price oriented. In addition, the usage frequency of the product has changed; the casual sportswear market will use the A 5 line series less often, than an extreme athlete.
Target Market Knowing that most outdoor equipment and apparel manufacturers were targeting hobby oriented consumer, North Face became a market niche, targeting "climbers, mountaineers, extreme skiers, snowboarders, and explorers." Its origins as a niche market provider, allowed it to target a selected group of individuals and become extremely knowledgeable of its consumers' needs. The target market is a younger generation of athletes, those that are between 20-35 years of age. It targeted mostly Generation X and early Generation Y individuals. In addition to targeting active individuals, North Face grounded itself for targeting individuals that can afford the benefits of a company that heavily invests in research and development.
Since the target market consists of affluent, extreme athletes North Face provided high quality at a high price. However, More for More was the idea behind the foundation of The North Face. Currently, The North Face is attempting to expand from a $5 billion specialty market to a $30 billion casual sportswear market. This new market will target the active baby-boomers who are becoming a larger part of the casual outdoor market. It will continue to provide the products to the extreme athletes, but the emphasis will shift to the larger market. This new market includes the extreme athletes and the new target individuals who use sports as a pastime and a hobby rather than a way of life.
But, the new consumer is more price sensitive and seeks comfort, rather than high quality. The company reveals the shift towards the new market through the production of the A 5 Series line. Yet, in its attempt to include the original market of extremist, North Face portrays the A 5 series as a bouldering line; thus, attempting to bring both the original market and the new expanded market into unison. Even though the company markets the A 5 series line as bouldering apparel, it emphasizes the casual comfort instead of quality (See Exhibit 5 for analysis of the results of a questionnaire of North Face's customers). The Positioning Strategy For 37 years, The North Face has been creating innovative, high-performance, technically-advanced apparel, footwear, equipment, and accessories for serious outdoor adventurers, global trekkers, and sophisticated urbanites who have one thing in common: they seek out, invest in, use, and wear the best. North Face's positioning strategy has been to create in the mind of the consumer a brand that is synonymous with quality, high performance and innovation, relative to its competitors in the same industry.
This market positioning allows North Face's products to occupy a clear, distinctive and desirable place in the minds of its target consumers. Thus, it is this positioning that distinguishes the A 5 line from competing brands and gives them the greatest strategic advantage in their target market. The A 5 series is positioned by the following slogan "Never Stop Exploring." Marketing Strategies and Mix Product: North Face has designs products to function as "equipment for the body," and its goal is to offer the most technically advanced products in its field and to establish the industry standard in each of its product categories. The Company designs many of its products for extreme applications such as high altitude mountaineering, rock and ice climbing, and back-country skiing and snowboarding. Moreover, the A 5 series clothing line is the newest of The North Face's product line for 2003.
The A 5 line includes shirts and pants designed for the everyday casual athlete and adventurer looking for comfort and style. The A 5 clothing series allows men and women the chance to wear clothes that reflect their lifestyle whether they are on the mountain or in an urban setting. The A 5 line features durable cotton material that allows for increased breathability and comfort compared with other active wear that is made of synthetic and polyester material. The relaxed fit quality is a feature of all A 5 clothing gear allowing athletes to concentrate on their task at hand and not be bothered with what they are wearing. The A 5 line offers a wide variety of free spirited designs and colors to choose from as well as features like bottom side vents on all shirts and constructed waistbands on the pants.
The style of A 5 clothing gives it versatility out in the field or even a night out on the town. The A 5 gear as with all North Face equipment is fully warranted against damage and defects for the lifetime of the product. The North Face takes great pride in the hardiness and longevity of all of their products and will repair or replace A 5 gear, even after extended use, without charge. Pricing: Due to the original target of extreme athletes, North Face was in the position to price at a higher price range, since it knew that the extreme athletes would pay more money for higher quality. North Face was a company build with the idea of product quality leadership. The high price represented to the consumer North Face's commitment to high quality and its dedication to research and development.
North Face practices product line pricing with the products for extreme athletes. Each new product attempts to satisfy as many needs of the customer. Even if a product is in the same line, but provide different functions for the users the product will be priced accordingly. Currently, North Face is attempting to reach the larger market, which makes it more vulnerable to competition. Therefore, it has created a shift to the lower price casual sportswear apparel to compete. With the A 5 Series line, The North Face is actually pricing at about the same price as its competitors, which ranges from $20 to $50 for a variety of products.
North Face was able to decrease its cost because it is manufacturing its products largely abroad, mostly, China. Through competition-based pricing North Face hopes to acquire the right amount of customers to make the A 5 Series a success. Also, North Face is hoping to capitalize on the expanding casual outdoor market. Demand has increased for goods that are comfortable and not as expensive as the high quality products about 7% in the whole market (See exhibit 1). Thus facing increasing demand for the products gives North Face the opportunity to reach the new consumers, while still being conscious of its competitor's prices. North Face rarely does any discounting for its products, the discounts occur when the company is attempting to get rid of inventories in preparation for the new seasons apparel and equipment.
North Face sends the old inventories to its outlet stores, which are allowed to discount the products. For the A 5 Series, North Face is attempting a new mode of promotional pricing that would allow it to penetrate the market. The outlet stores sold the new A 5 series line at a base of $5 for all medium size products. By having the promotional sale, North Face hopes that the consumer will be more knowledgeable of the products. In addition, North Face provides a lifetime warranty on all its products, with a no questions asked policy.
If the product gets damaged, North Face will replace it and take care of the problem for the costumer. Even though North Face has international markets, it chooses not to price differently in the different countries. Place: The products are mainly distributed into specialty shops, referred as Summit shops. North Face sells its products primarily to a select group of specialty outdoor, premium-sporting goods and major outdoor specialty retail customers, such as Recreational Equipment, Inc. and Eastern Mountain Sports, Inc. The use of Summit shops has helped North Face preserve the integrity of its brand identity because the retailers market the products in a way that is consistent with the company's quality standards and high quality service.
The Company sells its products to approximately 1, 500 wholesales customers in the United States, approximately 1, 200 wholesales customers in Europe and approximately 300 wholesale customers in Canada. Recently, however, North Face has expanded its distribution system to other intermediaries to include retailers and some department stores in order to reach the casual sportswear market and best sell the A 5 line series. It has modified its distribution system to include 4, 000 retailers and departments's stores such as Nordstrom and Foot Locker. Consequently, the A 5 line series is being distributed to Summit shops and to the new intermediaries. Manufacturers North Face makes use of outsourcing to produce its products.
Outsourcing has allowed the company to integrate systems, procedures and personnel more efficiently, despite the fact that North Face ran into problems with outsourcing distribution in 1999. North Face relies on approximately 50 unaffiliated manufacturers primarily located in Hong Kong, China, Taiwan, Korea, Indonesia, Bangladesh, Thailand, the United States, and Portugal to produce nearly all of its products. Difficulties The Company has not established long-term term contracts with its manufacturing sources; thus, it competes with other companies for production facilities and import quota capacity. None of the manufacturers produce the Company's products exclusively. As a result, North Face experienced distribution difficulties in 1996 and in 1999, due to delayed shipments and credit line problems. In 1996 the company experienced an embarrassing delivery glitch in the Tek ware line, which spurred a decline in the price of its shares to $13.
50 from a 52-week high of $33. Furthermore, suppliers have stopped the distribution of North Face's products in the past because North Face had credit line problems when it was experiencing financial difficulties in 1998. Promotion: The North Face does not rely on discounts to push its products; instead, the firm has concentrated on building a significant cachet for its brand within the outdoor market. In order to accomplish this, The North Face has conducted well-targeted advertising campaigns aimed at hikers, climbers, snowboarders and other outdoor sports enthusiasts. Historically, The North Face has avoided the mainstream media and has instead placed print ads in magazines such as Outdoor Magazine and Backpacker Magazine. The North Face's brand theme is about exploration, and the intention of its ads is to incite people to explore the outdoors.
The North Face has turned to ingenious methods of marketing to encourage its target market to explore. According to creative director Ron Walter, one thing that The North Face has tried to do is blur the walls between advertising and popular entertainment through what they call "strategic entertainment." Instead of placing overtly commercial television ads, The North Face's advertising agency, Blazing Paradigm in conjunction with American Adventure Productions, developed five one-hour documentary specials for NBC Sports. According to AdWeek, research showed that not only did viewers perceive The North Face as an apparel maker, but also as an expedition outfitter, which helped strengthen the brand's prestige. Besides using "strategic entertainment" advertisements, The North Face also relies on endorsements from outdoor magazines as a public relations promotional tool. This tool has allowed North Face's products to be a staple on Outside Magazine's annual Buyer's Guide. This type of promotion tends to resonate well with The North Face's target market.
Once The North Face's public relations and advertisement promotion campaigns have outdoor customers' attention, the firm resorts to personal selling and direct marketing to obtain a sell. Personal selling has enabled North Face to exercise control on how their products are presented and promoted. The specialty stores are staffed with personnel that are knowledgeable about outdoor sports apparel and who participate in outdoor activities; this allows them to establish long-term profitable customer relationships. Personal selling is an essential aspect of The North Face's brand integrity. The North Face also conducts in-store clinics and travel expos, bringing outdoor athletes into their store to discuss their expeditions and to instruct consumers on outdoor-adventure skills.
In store videos are a centerpiece of The North Face's direct marketing promotion. Kiosks play product demos and expedition footage, which encourage customers to explore the outdoors and to outfit themselves with the necessary North Face gear. Financials The North Face is one of 14 major brands that are subsidiaries of VF Corporation, the world's largest apparel company. VF Corporation consistently has over 5 billion in annual net sales, and closed 2002 with approximately 5.
1 billion (see exhibit 2). The North Face is a part of the Company's Outdoor Apparel and Equipment division. The North is the largest and most profitable company in the Outdoor Apparel and Equipment division. The North Face was bought by VF Corporation in 2000. At that time, The North Face was experiencing heavy losses and would have had to consider bankruptcy if VF had not gone through with the acquisition. Since the acquisition, The North Face has bounced back financially, increasing their sales and profitability mostly through heightened sales in Europe and through cutting costs.
The heightened sales in Europe are owed partially to greater concentration and growth of the target market in that location, and also to the depreciation of the dollar relative to the Euro. This depreciation makes foreign goods cheaper to Europeans, and causes increased demand and sales. The North Face has been able to cut costs since the acquisition in two ways. First, they have cut costs as part of VF Corp's company wide repositioning program. The repositioning program has cut costs by closing inefficient manufacturing plants and consolidation of distribution and administrative functions. The North Face has also been able to cut costs because becoming a part of such a big company has meant access to their resources and client base.
The access to resources such as suppliers and manufacturing equipment and technology brought down costs for the firm. Also the widened base of customers and existing customer relationships allows them to narrow the scope of their marketing, cutting costs. In the most recent quarter, ending April 22, 2003, the VF Corp continued its trend toward greater profitability and sales. In that quarter, net sales rose 15% mostly driven by the growth in sales of the North Face products in Europe (See exhibit 3). The recent trend in the apparel industry has been a slowing of sales, especially in the U. S.
due to the declining economy. Despite this, the North Face's sales and market share have been growing, aided by their brand integrity, and expansion, hopefully continuing with the A 5 line. At its retail stores, the North Face has a goal of key stoning, or achieving 100% mark-up over wholesale. All of their other products are sold at wholesale prices to distributors or are sold in the outlet stores. This wholesale price includes a markup from the total costs of the product, to allow for some profit.
About 85% of the gross profit margin is made by selling high volumes to retailer's at wholesale prices. In the future, the North Face should look to continue increasing its market share, cut costs, and improve the cost efficiency of its marketing strategies. They produce high quality products, and with the right marketing mix, they can continue to achieve high profit margins and sales volumes as well. Social Responsibility To the response of the "do the right thing" trend, The North Face is using several cause-related marketing campaigns.
These marketing campaigns are used not only to build a positive public image but also to generate more sales. In building a positive public image, the company focuses on both environmental and humanitarian issues. Several examples of philanthropy partnerships and donations to community are the following: 1. Partner with The Access Fund, a national non-profit organization dedicated to keeping climbing areas open and to conserving the climbing environment throughout the United States. The North Face has been giving annual donations since 1991 and has received a Platinum status for its 2002 contribution to The Access Fund. 2.
Partner with The American Alpine Club (AAC), a not-for-profit organization in the United States devoted to mountaineering, climbing, and the multitude of issues facing climbers to promote safe, environmentally sound climbing practices and to protect climbing access and preserve our nation's alpine areas. The North Face has acted as a patron and a campaign sponsor for The AAC. 3. Donated 1, 120 "Cat's Meow" sleeping bags each valued at $169 for a total in-kind donation of $189, 280 to The American Red Cross who focuses on meeting people's immediate emergency disaster-caused needs.
The company hopes that its donations could help the climbing organizations in preserving the natural environment. In addition to the environmental protections, the company desires to help other people, too. Instead of donating directly to a specific group, the company extends the benefits by donating money and equipments to non-profit organizations such as The American Red Cross that reach a broader audience. Through this donating policy the company hopes its contribution will have a greater impact on society.
These marketing campaigns also help to strengthen the company's image. North Face is known as a retailer that manufactures high-performance, climbing and backpacking equipments. Therefore, by establishing philanthropy partnerships with non-profit climbing organizations it allows North Face to protect the natural environment and also build a positive brand image. In addition to a positive brand image, North Face is able to indirectly market to the members of the non-profit organizations. For example, the members in this organization resemble North Face's target market; for example, these members are between 20 and 40 years old who like outdoor activities such as climbing and camping. Moreover, the climbing organizations have a relatively large number of members; thus, this enables North Face to build relationships with potential costumers.
For example, North Face has access to approximately, 15, 000 and 17, 000 members of Access Fund and AAC respectively. By building on the company's reputation to the members it is more likely that members will buy North Face products. By acting as a socially responsible company, by giving donations to well known non-profit organizations, North Face builds a strong public image. This allows society to perceive the company as a good citizen, instilling in the consumer a powerful image of a civic-minded retailer. As a result, when a consumer is confronted with a variety of competitor products the consumer will be more inclined to purchase a North Face product.
By performing social responsible actions the company is establishing long-term relationships with its customers and is strengthening its brand equity. Recommendations With the shift in target markets, from the specialty market that was the backbone of the company to a larger more profitable market of casual outdoor wears, North Face is risking losing some of its greatness and devoted customers in its rush for profits. However, there is a way that the company can circumvent some of the backlash from its original consumers and still be able to market to the new group. North Face should create a new brand name that would be use on the casual outdoor market. By creating the new brand name, North Face would be able to market the casual outdoor attire to the larger market, for which it has lower prices, while still maintaining the brand name The North Face for the high end products for the extreme athletes, for which high prices are charged. Positioning Recommendations: The company does not have an effective positioning strategy for the A 5 line because North Face's brand is so synonymous with high quality, high performance and innovation.
Placing the A 5 line in the same category as their traditional products creates confusion in the minds of consumers; the line is not as high quality as other North Face products. Their traditional mountaineering and hiking apparel aimed at extreme athletes is distinct from the A 5 line series sportswear apparel that targets the casual outdoor sportswear market. North Face has created a positioning strategy that says More for More, causing a loss of a clear positioning and disbelief among consumers with the A 5 line; thus, damaging their brand name. The transformation into the casual outdoor sportswear apparel market requires a more efficient positioning strategy for the A 5 line. North Face should instead, position the A 5 series in a way that it emphasizes the product's unique benefits and provides the company with a competitive advantage. For example, North Face could charge lower prices to position the A 5 series as a More for Less brand.
By using this positioning strategy, North Face can differentiate the A 5 line from its main competitor Prana by offering comparable quality at a lower price. Moreover, a suggestion for a positioning statement could be "to active consumers that enjoy outdoor activities, the A 5 line series is the sportswear apparel that complements the athletic lifestyle by providing more style and comfort than any other brand. With the A 5 line series you can climb a mountain with style. Furthermore, the A 5 line series should be positioned with the slogan: "Be athletic, be comfortable, be fashionable," instead of the current slogan: "Never stop Exploring." Competitive Environment Recommendations: Since the casual sportswear market has been growing, it is understandable for North Face to expand into this market and become more profitable. But its attempt to do so with the A 5 line series lacks consistency since this line does not provide distinctive features that will enable it to compete efficiently with competitor's products. In comparison to the other competitors' products, the A 5 series line is cotton based which makes it more comfortable, and is designed more fashionably.
These benefits need to be emphasized because they are the distinguishing factors that will provide a competitive advantage. North Face should benchmark the A 5 series lines against competitors' products to make quality adjustments and further meet customer wants. Furthermore, North Face should be attempting to be an overall cost leader; thus lowering its cost and earn a larger market share. As North Face becomes more involved in the casual sportswear market and the A 5 series becomes established, North Face should perform regular marketing audits to analyze the competitive environment and its marketing strategies to ensure success. Pricing Recommendations: The lower prices imply to the professional athletes that North Face has lowered the quality of its products, which will have a negative affect on their buying. However, if the North Face separated the markets and targeted each one differently it will be to its benefit.
With the professional extreme athletes, North Face will continue to use the higher prices and emphasize quality, innovation, and R&D. For this market North Face will not change its pricing strategy. However, for the expanding market North Face will have to adjust to its pricing strategy to their needs. The new market is in search of comfort, fashion, and quality, all of which North Face can provide under a new brand name. By pricing slightly less than competitors, North Face can increase its penetration of the casual outdoor sportswear market and compete more efficiently.
The A 5 series line is being marketed under the North Face name and priced at the same level at its competitors. With new products and a new brand name, North Face will be able to lower prices without risking further backlash from professional athletes. North Face will have the power and resources of Vanity Fair Corporation, which will help it in its goal of greater market penetration. It can provide the new market with more discounts, which it currently does not really offer to its professional athlete market, and base its pricing on cost or customer value instead of competition-based pricing, which it currently uses. With the new market it will be most it should pursue cost-based pricing because of the amount of competition in the casual outdoor wear. Place Recommendation: The market expansion into the A 5 line requires some modifications in distribution in order to make this line appealing to the target market.
Yet, it is also necessary that the company differentiate the distribution of the high quality products and the casual sportswear apparel, A 5 line, to ensure efficiency and a clear positioning message. Moreover, North Face should not distribute the A 5 line series in specialty shops because it is not cost efficient, instead, it should only distribute it to retailers and it should continue the distribution of the high quality products to the Summit Shops. This method will allow North Face to use its intermediaries in a more efficient manner because it will allow it to keep a focus on targeted consumers, and thus strengthen North Face's brand name. Moreover, North Face should capitalize on Vanity Fair's resources. North Face should use a horizontal marketing system so that it can access Vanity Fair's financial, production and marketing resources, which could facilitate the distribution and availability of the A 5 line series to targeted consumers.
By forming this strategic alliance, North Face will be more effective, and will create greater customer value and become more competitive. However, North Face should carefully select the distributors, in order to be consistent with the product and pricing message. More importantly, North Face should begin establishing long-term relationships with its manufacturing sources, so that it will not repeat past experiences with distribution disruptions. Otherwise, not having long-term contactors may have an adverse effect on the company's ability to stock the A 5 line series and make the series a success. Promotion Recommendations: Bouldering enthusiasts see A 5 products as inadequate for serious climbing due to the fact that A 5 products are made from cotton and are relatively cheaper. At the same time, plenty potential casual outdoor wear consumers are unaware of the A 5 line because North Face has not advertised in general magazines; instead, it has focused its advertisement in specialty outdoor magazines.
North Face should make a clear distinction between advertisement for traditional high quality products and the A 5 line series to promote the product more efficiently. North Face needs to adjust its advertising strategies to suit the product line in relation to the appropriate target market. In order for North Face to reach the casual sportswear market with products such as the A 5 line, the company needs to promote in general magazines such as the ones owned by Vanity Fair and mainstream media However, for specialty consumers, in terms of the A 5 series line, its advertisement should be tailored towards convincing the bouldering enthusiasts that the A 5 line can withstand the rigors of rock climbing and exceed the quality standards as the other North Face products do (See Exhibit 4). Social Responsibility Recommendations: In terms of North Face's attempt to reach a new market, having philanthropy relationships with organized climbing and hiking communities are no longer enough. The company needs to expand its donations to appeal to the larger audience. For instance, North Face should get involved in events that target the new market which include the baby boomers and it could also emphasize forming relationships with teenagers in order to increase their customer life value.
The North Face should expand its philanthropy partnerships to other non-profit organizations such as public schools and amateur baseball leagues in nearby neighborhoods. This approach will work effectively in drawing youngsters' attention to lead active lives; thereby, promoting a positive company image and increasing social welfare. Research and Methodology: Our group's exploration into the North Face proved to be a positive adventure and demonstrative learning experience. We began our research with an in-depth analysis of the North Face's personal corporate website. The website provided a closer look at the following topics: company information and history, news and events, products and product development, research and development, TNF Athlete Team, expeditions, and retailer information.
Beyond the corporate website, the World Wide Web was our golden connection to market information. We searched online databases such as Lexis-Nexis and the Business and Industry Database to find out information about the North Face's marketing techniques and strategies. "Never stop exploring" also seemed an appropriate slogan for our internet search as the virtual world was endless with possibilities of information discovery. Beyond the internet, our group tried to capture the essence of the North Face's retail mission "in-action" and "in person." We visited the retail store in San Francisco and the Outlet in Berkeley. We did observational research in both locations as well as conduct personal interviews with the Outlet Store Manager and two Sales Associates. To gather primary information, we asked customers, by simple random sample, who purchased North Face products to complete a closed-answered survey.
Our intention of the survey was to discover our own collection of primary data to support our theories and provide us with assistance in concluding an appropriate recommendation for the company. Outdoor oriented magazines and product catalogues were also successful facets of information. Our original hopes with choosing the North Face as our subject was that it was a global company whose headquarters were located in the Bay area. We thought we could reach Corporate in San Leandro and gain access into their internal databases. Our reality was a long game of phone tag and false hopes.
We finally made contact with the Marketing Director and PR Representative who agreed to do an email interview. Unfortunately, they never responded. Although we did not get information directly from the North Face headquarters, our team tactics of divided the different topics among our eight members helped us gain enough information through our many other resources. Bibliography Cornell Universality: web and web 00%20 Reports/Fall%2099%20 Term%20 Projects/NorthFacemerge. pdf Ginsberg, Steve. "Music industry exec set to rock and roll at North Face." San Francisco Business Times.
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