American Apparel Company
The firm opened its first store in 2003 and it has 260 stores across the globe. As a global firm, the marketing objective of the firm is to open more number of stores in remote areas and developing nations so that more market capture can be attained. In 2008, the firm saw extreme growth as it expanded to open 78 new stores in 2008 and high sales profit also but in 2009 -2011 recession period, the firm saw decline and therefore as per latest research journals, the firm focuses on expanding by having new stores in different markets which have not yet been traced. It expects to have annual growth rate of 50% as with time financial disruption of 2009 and its after effects have decreased (American Apparel).
Product development objective of the firm is to be the first choice of fashion conscious customers and having more number of online and offline stores in recent times so that expansion can be focused (American Apparel). E-commerce is one of the most focused objectives of American Apparel in 2016 and it expects to increase its sales gain by 20% due to online availability.
Marketing and product objective:
It expects to have annual growth rate of 50%
It expects to increase its sales gain by 20% due to online availability
The marketing objective of the firm is to open more number of stores in coming year and have 2 % more number of stores across the globe.
Sustainable competitive advantage: areas that can be leveraged:
For sustainable competitive advantage American Apparel should focus on value added service to be provided to its customers. For value added service, the firm should retain its customers in long run; they should focus highly on providing excellent service to the regular and first time customers so that even if the apparel industry of USA is volatile, then also due to excellent service quality and customer satisfaction people prefer buying from American Apparel than its competitors (Read and Bard).
The most important area that can be leveraged is e-commerce industry. For clothing and fashion industry increasing trend of online shopping has created acceleration across the globe and therefore more and more firms are entering into online shopping industry. American Apparel should strategically plan and position its online shopping portal with the help of various attractive offers and discounts for regular buyers, this way, e-commerce industry and regular buyers of online platform will get attracted and the firm will gain more growth and competitive advantage over local and international participants.
In order to have sustained competitive advantage American Apparel should focus on strategic human resource management. When American Apparel was established, it worked with a strong ethics on workforce management. The workers at American Apparel were the highest paid workers in US and similarly American Apparel should acknowledge the importance of its employees and with the help of effective human force management, performance management and marketing skill enhancement of its employees, the firm can grow more and it can dominate its competitors because apparel industry is very volatile and if a firm wants to gain sustainability then it needs to motivate and satisfy its workforce so that they work for accomplishment of marketing objectives and vision of the firm.
When designing the product for American Apparel, it is kept in mind that present day fashion trend is targeted those clothing designs and patterns that are best suited for style conscious and modern day people.
Women’s clothing has a wide variety of options like formal wear, casual wear, and 499 styles in 614 colors. There are different columns for women, men, kids etc. and in each column there are sub-units as per choice of customers. It has been listed below:
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This way, the product options are wide and for every individual, there are various options for fashion varying from clothing to accessories and socks.
Idea behind product options:
A firm should always focus on different type of customers who will visit their stores and online portals for purchasing. In case of American Apparel, it is very important that the fashion statement of USA is taken worldwide and is advertised and sold in such a manner that people visit again and again. For having a regular link with their customers, American Apparel focuses on having wide range of fashion options for its portal viewers and customers.
The website has been very attractively designed where under one roof all the required queries about fashion could be solved and the attractive offers have been highlighted on the site so that people click on the links and buy more and more stuff with great happiness because discounted rates and free delivery for big purchases attract people.
Brand name and imaging has been effectively done and in online shopping there is need to have little more SEO so that American Apparel is able to attract more customers. Search engine optimization will enable American Apparel as a fashion based firm to dominate its competitors and become easily available to people when they search goggle or other search engines.
Privacy, security and warranty:
Privacy of customers, their data security and transaction privacy is always considered a very important aspect for e-commerce. In case of American Apparel, privacy declaration is mentioned on website, security and safety of bank details has not been an issue because of effective auditory control and financial database. Warranty of product is there and easy return policy is also available.
Price list is very varied and options for customers start from $5 to $100. In the option where price can be sorted, customers can opt for limiting their minimum and maximum range so that more products can be seen varying in their budget.
Discounts and allowances:
Heavy discounts are given in sale season. For example- in present time, up to 50% off can be seen on the website which will end on 18th January, 2016 (American Apparel). Allowances and special offers are always available in the company. Students get extra discounts and when people join American Apparel club, they are given different type of allowances for retaining them.
Credit policy and payment module:
Payment gateway is through bank and credit cards and once payment made the product gets delivered within the given time frame. If there is some dissatisfaction on the part of customers, then return options are available (American Apparel).
Top pricing vs moderate vs low pricing:
In top pricing i.e. $ 80-$ 100, there are very less product options because less number of customers is willing to buy highest priced fashion outfits and accessories. Lowest price i.e. $ 0- $ 20 has maximum number of products which means that online shopping is being made easy and attractive to normal day to day buyers who prefer buying good quality products at decent prices.
With the help of study of pricing strategy at American Apparel it was found that in case of online marketing, the firm focuses on mass marketing so that more and more segment of population varying from lower middle class to high class can purchase from the website and different stores and get quality products at least prices.
Strategies that needs to be taken:
Increasing search engine availability of American Apparel website on the top (Spas).
Focusing on more variety of product options for suiting the global taste rather than being US specific designer brand.
Making price effective with local and national level competitors in other nations so that American Apparel can be made a global brand.
American apparel. “Competitors and market share”. 2016.18 January,2016 http://appcompanyresearchreport.weebly.com/competitors-and-market-share.html
Reik Read, Robert W. Bard. “American Apparel case study”. 2016. 19 January,2016 http://rfidjournal.net/PDF_download/American_Apparel_Case_Study.pdf
American apparel. [Online] 19 January. 2016 http://store.americanapparel.net/sale_cat1810150?N=583321162&Nr=P_On_Sale%3A1&Nrpp=100&Ntl=en
American apparel. “Returns and exchanges”. 19 January,2016 http://store.americanapparel.net/help/returns-exchanges.jsp
George S. Spas. “SEO as a dynamic online promotion technique”, innovative marketing, vol-6, no-1. 2010.