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Meeting Objectives

Meeting Objectives. Share key learnings from consumer and competitive research Provide a reco for AE Fall promotional campaign to drive jeans sales during July-Sept . Demographic Trends. YOUNG AND FREE. Population 21.1 million 20-24 yr olds in US College Demographics

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Meeting Objectives

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  1. Meeting Objectives • Share key learnings from consumer and competitive research • Provide a reco for AE Fall promotional campaign to drive jeans sales during July-Sept

  2. Demographic Trends YOUNG AND FREE • Population • 21.1 million 20-24 yr olds in US • College Demographics • 39.6% enrolled in college

  3. Social Trends ACCEPTING & EXPERIMENTAL 57% of college students volunteered last year. • Millennials’ Uniqueness: • Technology Use- 24% • Music/ Pop Culture- 11% • Liberal/ Tolerant- 7% • Smarter- 6% • Clothes- 5%

  4. Technology Trends ALWAYS ON & COMPLETELY CONNECTED • Facebookuse: • College dem. grew the fastest at 74%/ yr • 69% of all users are a fan of 1+ company page • Twitter use: • 29% of users (18-24) follow their favorite companies

  5. Economic Trends FEELING THE PINCHBUT CAN ALWAYS CALL HOME FOR ABAILOUT 55% Watch Spending 36% Financially Dependent

  6. Surveying the Target Market 66% want discounts 59% want sale promotions

  7. FOCUS GROUP FINDINGS

  8. Meet Allie! • 20 Years Old • Attends University of New Hampshire • Motto- “Live Fun & Live Free • Financially supported by her Mom and Dad • Part-time waitress • Loves technology • Active on campus through volunteering ”

  9. Positioning Statement

  10. Value Proposition

  11. Integrated Marketing Campaign Vehicles • Digital • Technology and social networking is extremely important in reaching the target audience • Direct-Mail • Ability to target college students who aren’t current customers of AE by purchasing lists of their addresses • Print Ads • 59% of consumers said they pay greater attention to magazine ads than any type of Internet advertising 4) In-Store • Once consumer gets into the store, they’re that much closer into converting into a sale

  12. LOOK GOOD DOING GOOD • Jean Giveback Advertising Chevy Volt Sweepstakes

  13. Jean Giveback

  14. Mailer Direct Mail- reaching 2.5 million homes of college students

  15. Orientation “Mailer” • Given to all freshmen entering colleges & universities with AE Student Unions • Drives try-on & sales

  16. Chevy Volt Sweepstakes

  17. In-Store Promotions Recycled Shopping Bags & Electronic Receipts Buy 2 pairs of jeans, Get FREE t-shirt! T-shirts sold – 10% of profits donated In-Store Poster

  18. Store Layout

  19. Employee Support • 35,000 Employees • Training • In-store vehicle for sales • Promotions • Reach Out Program • Friends and Family • Social Media Outreach • Flyer distribution • Campus Ambassadors

  20. Budget Allocation

  21. Why Champion Enterprises: • Relevant & Motivating to College Target • Fits with AE image & can be ownable • Will drive sales in key back-to-school time • Expands AE position as lifestyle brand

  22. Index Slide • Budget Breakdown • SWOT • Competitor Landscape • Competitor A&F • Gap • Aeropostale • AE Traffic • AE Attributes and Values • Demographic • Jean Statistics • Chevy Volt • Budget Volt • Budget SMS • Budget Websites • Car Sweepstakes • Good Cause Marketing • Direct/Email Response Rates • Jean Give Back • Social Media Marketing • Social Media With A Cause • Magazine Marketing • AE Student Union • allEtronic • References

  23. Budget Breakdown INDEX

  24. SWOT INDEX

  25. Competitor Landscape INDEX

  26. Info on: • 4 Brands • All distinct but competitive • AE competes with A&F and Hollister • A&F: 1.272.28m in 2010 • Hollister: 1.287.24m in 2010 • Revenue decreased by 16% in 2010 with 23% decrease in sales • Attempting to expand to Japan and Europe • (One Source, 2011) INDEX

  27. Info on: • 5 brands • Wide price spectrum: Old Navy  Banana • AE competes with Gap and Old Navy • Gap • 134,000 employees & over 3,000 locations • American Eagle had 35,000 employees & 931 locations • 13.7% Profit Margin in 2010 • AE had 10.&% Profit Margin in 2010 • Declining sales of 3.19% • 90% of total revenue comes from sales • Recalls on quality = poor public image INDEX

  28. Info on: • Target Market: 14-17 years old • 4160 emplyees and 965 retail locations • AE has 35,000 employees • 929 AE locations, 148 aerie locations, 9 77 kids locations • # 2 in the market behind AE • Operating margins are 17.2% • AE is 11.5% and A&F is 7.8% • Only in North America with 96% of revenue from the US INDEX

  29. American Eagle Traffic Statistics • Consumers • Women’s brand has expanded by 70% in past 20 years • 21 million loyalty members • Stores • Over 930 stores with 30 million visitors monthly • #1 Specialty retailer • Webpage • AE.com is a top 50 commerce site- over $300 million • 20 million website visitors monthly INDEX

  30. AE ATTRIBUTES & VALUES • The American Eagle brand is built on 3 key attributes: • - Great Products • - Exceptional Value • - Customer Focus: The College Lifestyle AE • Core Values: • - Honest & Real • - Individual • - Current – Fun INDEX

  31. College Students: Connected & Caring • Demographic Trends YOUNG & FREE • Economic Trend • FEELING THE PINCH • BUT CAN ALWAYS • CALL HOME FOR A • BAILOUT • Technology Trends • ALWAYS ON & COMPLETELY CONNECTED • SocialTrends • ACCEPTING AND EXPERIMENTAL INDEX

  32. AE Jean Statistics • Strong reputation on fit, quality, and value • 12 million pairs sold each year • 4 million during back to school • #1 market share in Men’s and Women’s Denim for Specialty Retailers, ages 15-25 • Specialty retailers control 42.6% of Women’s denim market • AE Jeans are #2 in Women’s top 10 brands • Price range $39.50-$59.50 INDEX

  33. Chevy Volt • Motor Trend 2011 Car of the Year, 2011 Car and Driver 10Best Award • 2011 Green Car of the Year • Up to 95 MPGe, 35 city 40 hwy on gas • 35 mile electric range, 407 total range • Charges via a standard 120V outlet (10hrs) or Chevy sells a 240V charging station (4hrs) • Chevy Carbon Reduction Campaign- Investing 40 million dollars in initiatives that will help reduce up to 8 million metric tons² of carbon dioxide from the atmosphere • Aligns with our initiatives and marketing campaign INDEX

  34. Budget Volt • Chevy volt is $32,780 after $7,500 tax credit INDEX

  35. Budget SMS • SMS Messaging: Source cites that 40% of people 18-34 are interested in SMS advertising. Approximately 20 mil college students would mean roughly 8 mil SMS subscribers in target market. • SMS has a high response rate, 6.4% in clothing industry. INDEX

  36. Budget Websites • Targeted Web Advertisements: between .1 and 4% response rate. Estimated 2% across all websites. 66,500,000 advertisements for 1,330,133 clicks. • Targeted websites: Facebook, Google, Youtube, CollegeHumor, Pandora, and Hulu based on College Student Traffic. INDEX

  37. Why choose to do a Car Sweepstakes • Sweepstakes can increase response rate and sales An effective way to connect social cause with marketing goals INDEX

  38. Why choose a Good Cause for Marketing • Volunteerism high 57% for Millenials within the last 12 months—focused on local community        • Tend to be politically pro-government and socially liberal (29%)= Democratic (62% lean to D) big supporters of Obama • 21% if 18-29 year olds think volunteering and helping others is the most important thing in theirlives • 87% of consumers said they would switch from one brand to another comparable brand, based on its association with a good cause. • 48% of American and British consumers have been motivated by a cause -related marketing campaign to change brands, use a product more, try new products, or get information about new products INDEX

  39. Response rate of Direct Mail and Email • 92% of 18-24 year olds use the internet and/or send/receive emails occasionally • Email response is based off of opening rate of 20% and response rate around 2% • Response is due to content and personalization   • Direct Mail response rate for a letter sized advertisement is approx 3.5%  INDEX

  40. Why A Jean Give Back Will Be Successful • AeropostaleJeans for Teens campaign brought in 542,411pairs of jeans in just four weeks • Customers received one 25% off coupon per pair of jeans donated • Aeropostale transferred donated jeans to local shelters for distribution • Gap sponsors the Cotton From Blue to Green campaign •  Customers received 30% off coupon on a new denim purchase •  Jeans were used to insulate new houses INDEX

  41. Reasons for Social Media • 81% of 18-24 do have a social network page • 58% of 18-24 check facebook at least once a day • 69 % of all facebook users are fans of at least one company • Awareness and purchase intent increases with home page ads on social networks • 2% increase from home page ad • 8% increase when a friend "likes" home page ad INDEX

  42. Social Media With A Cause • Website advertisements are more effective when combined with a social advocacy campaign • Can quadruple purchasing intent • INDEX

  43. Magazine Advertisements • 25.2% of 18-24 year-olds enjoy reading magazine ads • 24.2% of female magazine readers 18-24 read Cosmo  • 17.3% of females magazine readers 18-24 read People INDEX

  44. Jobs for the AE Student Union • 1 Brand Ambassador and 2 Brand Representatives will be at 48 colleges and universities across the country starting fall 2011. • Brand Ambassadors will now organize more clothing drives and publicize the events. • 924 fans on Villanova AE Student Union page. • The Clothing Drive will be directly linked to the Look Good Doing Good campaign. • INDEX

  45. allEtronic • Software program that connects to credit cards, debit cards, etc. and automatically sends receipts to one place • Reinforces the “Doing Good” aspect of the campaign • Saves money for AE on paper and printing • In order for receipts to be produced for 1 year: • 9.6 million trees cut down • 249.6 gallons of oil • 1.2 billion gallons of water • 1.5 billion pounds of trash • Also speeds up the check-out process, reduces time waiting in line INDEX

  46. References • USA Today, 2006 http://www.usatoday.com/life/lifestyle/2006-06-28-generation-next_x.htm • American Eagle Outfitters, Social and Corporate Responsibilityhttp://www.ae.com/web/corp/responsibility.jsp?topic=environment • Pew Research Center, “Millennials: A Portrait of Generation Next” (PDF) http://pewresearch.org/millennials/ • Datamonitor (2010) American eagle outfitters Inc. company profile. http://ezproxy.villanova.edu/login?URL=http://search.ebscohost.com/login.aspx?direct=true&setup=0&db=buh&authdb=dmhco&browse_option=CP&site=bsi-live • Morningstar Equity Analysts (2011) American Eagle Outfittershttp://library.morningstar.com/stocknet/MorningstarAnalysis.aspx?Country=USA&Symbol=AEO&pgid=qtqnlinkanalysis • Nielson (2010) http://adage.com/article/digital/nielsen-facebook-s-ads-work-pretty/143381/) • O’Neil, (2007) Is Facebook Advertising Effective? http://www.allfacebook.com/is-facebook-advertising-effective-2007-11 • OneSource (2010) American Eagle Outfittershttp://globalbb.onesource.com/web/Reports/ReportMain.aspx?KeyID=191491&Process=CP&CIK=919012&Report=STRENGTHWEAKNESS • P., Carol (2008) http://millennialmarketing.com/2008/05/millennials-the-wealthiest-americans/ • Quantcast, 2011 http://www.quantcast.com/americaneagle.com • The U.S. Young Adult Market, 2005 http://academic.marketresearch.com/product/display.asp?productid=1091627&curl=&surl=%2Fsearch%2Fresults.asp%3Fprid%3D811629525%26query%3D20%2Byear%2Bolds%26cmdgo%3DGo&prid=811629525) • Westwood University (2011) http://www.westwood.edu/resources/student-budget/ INDEX

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