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

Key Terms Cocooning - surrounding a person within a garment, creating an enlarged oval shaped silhouette which begins at the shoulders normally ending at the thigh or calf OR the preference of people to stay at home Computer databases - typically contain aggregations of data records or files, such as sales transactions, product catalogs and inventories, and customer profiles. Consumer panels - groups of people organized by a company or an organization doing market research to give their opinions about products. Data mining - Analysis of computer database information from retail sales, using software to discover patterns and derive actionable responses

Terms cont’d Database marketing - a system of electronically stored data that is gathered through market research, constantly updated, and used for company marketing activities Demographics - vital statistics of human populations broken down by age, gender, race, education, religion, income, occupation Electronic feedback tests - information from the object of some activity, and may help to improve that activity Focus groups - a group of people are asked about their perceptions, opinions, beliefs, and attitudes towards a product, service, concept, advertisement, idea, or packaging

Terms cont’d Intelligent retail technologies - tools to help run the business better in a multichannel world Market research - the process of systematically gathering and analyzing information, such as consumer tastes and changing trends Market segmentation - dividing the total market into smaller groups that contain similar characteristics Marketing - the process of finding or creating a profitable market for specific goods or services

Terms cont’d Merchandising - the activity of promoting the sale of goods Niche marketing - Concentrating all marketing efforts on a small but specific and well defined segment of the population Place - the channel, or the route, through which goods move from the source to the final user Price - The cost required to gain possession of something Product - Anything, either tangible or intangible, offered by the firm as a solution to the needs and wants of the consumer Promotion - the business of communicating with customers (inform, persuade, remind) Source: Boundless. “Product, Placement, Promotion, and Price.” Boundless Marketing. Boundless, 21 Jul. 2015. Retrieved 17 Oct. 2015 from https://www.boundless.com/marketing/textbooks/boundless-marketing- textbook/introduction-to-marketing-1/introduction-to-marketing-18/product-placement- promotion-and-price-108-4454/

Final Terms Psychographics - statistics that try to explain consumer behavior through lifestyle, values, attitudes, and self concept Surveys - an examination of opinions, behaviour, etc., made by asking people questions Target market - the specific segment of a total market that a company wants as consumers Target marketing - defining of the specialized niche of the market to whom the company wishes to make it greatest appeal Virtual reality - a realistic simulation of an environment, including three-dimensional graphics, by a computer system using interactive software

Components of a Marketing Mix

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