Online Tutoring on Marketing Management

Introduction

This marketing assignment is focused on Australian fashion brand – Country Road. The purpose of this assignment is to analyse the Country Road’s external environment through PESTLE and SWOT analysis. Moreover, this assignment will also carry its competitor analysis. Through in-depth study and analysis, this assignment aims to understand the segmentation, targeting and positioning strategy of the company. The ultimate goal of this assignment is to recommend the positioning statement to implement by Country Road.

 

Company Overview

Country Road was established in 1974 as a niche women’s clothing business and it has evolved into Australia’s leading lifestyle brand catering women, men, children, and home accessories. Country Road’s headquarter is located in Richmond, Victoria. Country Road has the estimated annual revenue of $208.6 million and it has around 228 employees (https://www.owler.com/company/countryroad#overview). Country Road has continued to expand its market by introducing its fresh and sophisticated collection for household, men and women of a simple and exclusive lifestyle. Recently, Country Road has collaborated with the most authentic Australian brand like Qantas to serve its customer by providing inflight amenity kit (Countryroad.com.au, 2018).

 

Discussion

Industry Analysis

Country Road operates in the clothing industry in Australia. Its topmost competitors operating in the Australian market include Zara, M&S, Pacific Brands, and H&M. According to a recent report of IBIS World (2018), the Australian clothing retailing industry has been facing several challenges over the five years. The clothing industry has witnessed cautious consumer spending, rising rent cost and intense competition. However, the industry has expected to grow by 2% annually from 2018-2019 to a total of $16.7 billion due to rapid expansion in online stores (Ibisworld.com.au, 2018). However, the industry’s total revenue grows by 0.1% due to its weak disposable income (Figure 1).

 The clothing retailing industry has been facing difficulty in trading due to the negative consumer sentiments and rising competition from online-only retailers. Since the growing popularity of online shopping is favored by the consumers, the retailers face difficult time coping up within the market. The Australian clothing industry has a wide number of retailers that leads to economies of scale through expansion (mergers and acquisitions). Another threat for the industry is the intensifying competition due to international retailers. Also, the franchises and chain stores often lead to the reduced market shares of the brands (Ibisworld.com.au, 2018).

 

Country Road is an Australian clothing retailing brand and its topmost competitors operating in the Australian market includes Zara, M&S, Pacific Brands, and H&M. In order to keep a step ahead from the competitors, companies highly focus on segmentation, targeting and positioning process. Country Road has the three major bases of its smooth operations throughout Australia. Country Road highly focuses on maintaining its quality, focus on consistency in design and importantly, to maintain its brand image through effective positioning.

Country Road specifically distributes an assortment of garments for the diverse genders and age in order to continuously grow and expand the brand to compete successfully in the market (https://prezi.com/7pqwd9eyhb-l/country-road/). Focusing on Zara as a major competitor, it is significant that Zara annually launches at least 10,000 new designs (https://prezi.com/7pqwd9eyhb-l/country-road/). On the other hand, Thomas Bryson captivated manufacturing and distributing various types of fabrics, textiles, and garments throughout the world (Ewing, Wagstaff & Powell, 2013).

Other than the Country Road, the Australian fashion industry is crowded by the locally owned brands. Although, numerous brands sell their product internationally, through bricks-and-mortar’s format from within Australia. Similarly, Country Road has also adopted innovation for online transactions (Cooper, 2014). Figure 2 represents the market share occupied by the leading fashion brands in Australia, where Woolworths International Pty Ltd occupies 5.7% of the market share (Ibisworld.Com.Au, 2018). In 1998, the “Woolworths Holdings Limited” based in South Africa has held 88% control over the Country Road. However, the Country Road Group also acquired a variety of clothing bands like Witchery and Mimco (Jewelry and accessory brand) in 2012. Even though Country Road along with Trenery and Witchery is recognized for womenswear, for which it generates higher revenues online. As per the company’s report for the past five years, Country Road has grown significantly by 15% of the total revenue generated through online sales (Countryroad.com.au, 2018).

Moreover, Figure 3 provides the financial highlight of Woolworths International. It represents that Country Road has successfully grown by 35% over the five years till 2018. This reflects that Country Road has outperformed as compared to the overall industry. Since Country Road has profoundly focused on innovation and developing online infrastructure for its clothing brands, it has generated around 6% of the revenue through online sales in 2013 – 2017 (“Ortolan, Country Road Brand Strategy”, 2018). Moreover, the purchase of Witchery enabled Country Road to enjoy synergy in operations and procurement and to enhance its economies of scale and improved profits (“Ortolan, Country Road Brand Strategy”, 2018). To move further, Country Road also implemented new procurement and supply chain system for smoother streamline its physical stores with online stores.

 

References

Brakus, J. J., Schmitt, B. H., & Zarantonello, L. (2009). Brand experience: what is it? How is it measured? Does it affect loyalty?. Journal of marketing, 73(3), 52-68.

Carroll, A., & Buchholtz, A. (2014). Business and society: Ethics, sustainability, and stakeholder management. Nelson Education.

Cooper, T. (2014). Digital technologies and the future of the Australian fashion industry.

Countryroad.co,.au (2018). Retrieved from https://www.countryroad.com.au/images/assetimages/ASX/42pjplbcdk979k.pdf

Craik, J. (2015). Challenges for Australian fashion. Journal of Fashion Marketing and Management, 19(1), 56-68.

Croffey, A. (2018). Zara and Country Road’s unlikely new competitor: Katies. [online] The Sydney Morning Herald. Available at: https://www.smh.com.au/lifestyle/fashion/zara-and-country-roads-unlikely-new-competitor-katies-20160504-gom3es.html [Accessed 17 Dec. 2018].

Ewing, M. T., Wagstaff, P. E., & Powell, I. H. (2013). Brand rivalry and community conflict. Journal of Business Research, 66(1), 4-12.