2. Part 1: Basic Fashion and Business Concepts
Chapter 5
Satisfying the Fashion Market

3. Objectives Distinguish between market growth, share, and segmentation
Describe the importance and methods of market research
Summarize the concept of product development
Explain the latest fashion industry information technology
Explain the efforts that are being made for overall industry excellence
Describe how the industry is improving its image

4. Market Growth and Share
Growth is the increase in size of the entire market
Share is the part of the total market controlled by a firm
Competition results from firms trying to increase their market share

5. Market Segmentation
Dividing the total market into smaller groups that contain similar characteristics, since no business can serve ALL customers
Target marketing defines this niche

6. Demographics Statistics of human populations by: Age Gender Race
Education
Religion
Income
Occupation
Geographic location

7. Psychographics
Statistics that try to explain consumer behavior through:
Lifestyle
Values
Attitudes
Self-concept
Culture
Social groups
Personalities

8. Market Research
Gathering and analyzing information relating to a particular market
Results may indicate:
Shopping behavior
Product preferences
Price ranges
Types of advertising preferred
Needs and wants

9. Market Research Methods
Surveys
Consumer panels keeping diaries
Slower; broad trends
Focus groups
Particular subject or product line
Computer databases
Electronic feedback tests
Virtual reality

10. Product Development
Process of taking a product from the conceptual idea to the market
Continually changing, striving to meet the needs of the consumer

11. Information Technology
Providing information through computer technology
Collection, classification, storage, retrieval, and dissemination of data
Inventory control
Shipping/receiving
Customer tracking

12. Technology Methods Bar codes Radio Frequency Identification (RFID)
Universal Product Code (UPC)
New UPC-A includes numbers with the lines
Optical scanners
Feed bar code data to computers
Radio Frequency Identification (RFID)
Uses radio waves to send data from “smart” labels
Magnetic stripes
Voice recognition
Machine vision
Identifies products
Smart cards
Microprocessor within plastic

13. Technology Disadvantages
Financial cost
Computer hardware
Software
Bar code printers and scanners
RFID tags and readers
Power failures
Vast amounts of data
Consumer privacy concerns

14. Open Systems Integration of computer systems with each other
Industry data exchange standards
Multivendor networks
Outsourcing hires “third party providers” to manage computer network

15. Electronic Data Interchange (EDI)
The exchange of information and transactions through computers using a common digital language
Data available in “real time”
Printouts can be generated
Web based

16. Cooperation for Industry Excellence
Competition from world markets has increased over last 50 years
Industry segments now cooperating to regain market
The industry is striving to provide quality, value, and delivery in a timely, efficient manner

17. Quick Response Benefits:
Focus on consumer needs
Communication accuracy
Higher quality standards
Better buying, production, and distribution
Lower inventories
Easier reordering
Shorter lead/response time
Improved forecasting
Fewer markdowns
Higher profits
Streamlines supply chain by transmitting product code data using EDI technology throughout the entire textile-apparel-retail pipeline.

18. Corporations and Partnerships
The Textile/Clothing Technology Corporation, [TC]2, is a not-for-profit industry-wide organization
Researches high-tech innovations in apparel production equipment and processes
Helps the industry implement new technologies and business processes

19. Improving Its Image
Continuing efforts to educate the public about the industry
Quality products
Higher standards of ethics and social responsibility
Education, family care, health issues, and safety of employees
Environmental and community initiatives

20. Do You Know . . .
What demographic and psychographic data would define YOU?
Why is product development so important to the fashion industry?
Why is synergy so important to the industry?