FM – 4.00 Understand the marketing of fashion 4.01 Understand the fashion retail elements of marketing

Key Terms •Partnership •Competition •Profit •Consumers •Pure Competition •Resources •Retailers •Services •Sole Proprietorship •Standard of living •Supply •Competition •Consumers •Corporation •Demand •Free-market system •Goods •Manufacturers •Monopoly •Oligopoly I didn’t define because there is a vocab activity in the curriculum guide and all terms can be found in Chapter 3 of the textbook

Free-market System •People freely choose how to spend their money –Those choices determine which products are offered in the market along with price and quality –There is little government involvement –A business with goods or services to sell can charge any price and sell to anyone willing to pay –Consumers are free to buy whatever they want and can afford

Competitive Market Structures •Competition is good for the economy, there are laws that prevent a single enterprise from becoming too BIG P Pure Competition Monopoly Oligopoly Ideal condition – no single company is large enough to influence prices. Example: T-shirts Only one company offers a given good or service for sale. Example: Electric Company Cross between Pure Competition and Monopoly. Only a few large rival firms offer the same type of product. Example: Credit Cards

Forms of business organizations •Sole Proprietorship – owned by just ONE person. Easiest form to start or to dissolve. The owner has freedom and flexibility and there are few government regulations. Major risk is liability or responsibility for debts and obligations of the business

Forms cont’d •Partnership – unincorporated businesses co-owned and operated by two or more persons. •They are easy to form although an agreement should be drafted and signed by the partners. •Partnerships have longer life spans but there is potential for conflict

Forms cont’d •Corporations – separate legal entities •Empowered by the state to carry on a specific line of business •Owned by stockholders (aka shareholders) •Can raise money by selling shares of stock •Are complex and expensive to form and dissolve Types – public, private, S, and nonprofit

Satisfying today’s consumer

Components of a Marketing Mix

Market Segmentation It is more manageable to divide the total market into groups of people with similar characteristics. Segment means to break into pieces. Ex: Customers with dogs, Customers that are retired, Millennials, Customers that are health conscious.

More on Market Segmentation Two of the main ways to segment a market are byt the following traits: Demographic: Age, gender, race, education, religion, income, occupation. Things about a person that are facts, not opinion based. Psychographic: Lifestyle, values, attitudes, opinions, etc. Things about a person based on opinions and preferences. For example, their political views, whether or not they are active or like to travel, if they are health consious, etc. The key word is lifestyle.

Relationship between marketing and merchandising works with the brand on a community/advertising level works with the product on a retail level 2. how a company advertises itself/raises awareness of its image 2. how a product is displayed in a retail market 3. is creating a feeling around a company & a brand that makes a consumer want to buy products 3. is creating promotions, displays, and maximizing revenue per square foot of floor space 4. the management process through which goods and services move from concept to the customer 4. the activity of promoting the sale of goods at retail markets 5. begins the experience and continues awareness of the company after leaving the retail market 5. guides consumer to the product and it’s unique qualities. Then completes the consumer’s experience http://atozmerchandisingandconsulting.blogspot.com/2011/08/marketing-vs-merchandising-top-5.html

Demographics & Psychographics importance in the fashion industry Demographic Considerations - By analyzing population shifts, market size, family status, nationalities, age groups, and so forth, it is possible to gain a significant insight into potential markets. Social classes, and the ways each level views its income, goals, education, and attitudes, and the family life cycle and how the needs of people at each stage affect their purchasing potential are two other areas that merit attention Psychographic Considerations - By studying people’s lifestyles and attitudes, fashion retailers are able to take even closer looks at their targeted markets. The self-concept theory focuses on how the consumers perceive themselves. Fashion retailers can gain another perspective of their customers by applying this theory to how they stock their inventories http://themarketpro.net/knowing-your-audience-demographics-psychographics http://www.prenhall.com/divisions/ect/app/Diamond_temp/source_files/dia76827_ch04.pdf - great resource - 2 Case Studies with questions at th end

Satisfying today’s consumer market See also the following articles: Today's Empowered Shoppers 9 Brand Experiences 4 Traits of Today's Consumers The video is 5 years old, but is a great summary of the objectives, approx 3 mins. All articles are from the curriculum guide