Fashion industry in Australia-Free-Samples-Myassignmenthelp.com

Question: Discuss about the Fashion Industry in Australia. Answer: Introduction Fashion industry is one of the most promising industries around the world and due to the reason of rapid globalization; it is growing at a huge pace. Currently, the domestic value of the fashion industry in Australia is 21 billion dollar. It is also been seen that the annual expenditure of the Australian customer in the fashion accessories is estimated at 28 billion dollars. Thus, it can be stated that there is a huge opportunity in the Australian fashion market (Au.fashionunited.com 2017). The export scenario of the Australian fashion items is also favorable with having value more than 6 billion dollar. Fav is a new entrant in this market. They will introduce number of product under their brand name. The product portfolio will include footwear, clothing and apparels. The main vision of Fav is to create a benchmark in the niche market in terms of the quality and innovative designs. Majority of the fashion chains cater to vast number of customer segments. However, Fav will cater to th e particular niche market which will help them to maintain their exclusiveness. In the initial stage, they will start their business from Sydney and later on international business will be considered. The existing fashion market scenario is quite competitive with having large number of competitors (Unay and Zehir 2012). Thus, this report will analyze the potentiality of Fav in the Australian market. Market potentiality of Fav As discussed earlier, the fashion market in the Australian regions is growing at a rapid pace. The fashion market is being further classified in various segments such as garments, footwear and accessories. Among all this classifications, clothing is the most promising sector followed by the footwear sector. Hence, Fav will cater to these sectors covering vast customer segments. According to the latest data available, footwear constitutes the second most market share among all the fashion apparels in the Australian market (Casidy 2012). Thus, it is a huge potential for Fav to have footwear in their product portfolio. Moreover, initial demographic target segment for Fav will be the adult population. This is due to the reason that, according to figure 2, women and men aged between 20 to 49 years is the main contributor in the sales of the fashion industry. Thus, it can be concluded that the target market for Fav is quite potential in the Australian market. Potentiality of the online market Online market is the new trend in the retail business. Thus, fav will also leverage on this opportunity. It will help them in catering to larger number of customers. Moreover, the customer base will not be domestically restricted, rather than it will target to the global customers. Online distribution will also help in effective marketing of the product of their products (Wang et al. 2013). According to the data being given in the figure 3, it is shown that the online expenditure has being grown by leaps and bounds in the recent years. Thus, initiating the online distribution system will help Fav to cater effectively to more number of customers. Target customer segment As discussed earlier, the target customer segment for Fav will be the young adults in the Australian market. However, the target customers for Fav will be the higher end customers. They will cater to the niche market. Accordingly, the marketing and promotional activities will be designed which will attract the targeted customers (Riefler, Diamantopoulos and Siguaw 2012). Niche market of the higher end customers is being selected as the target market of Fav due to the reason that, the mass market of fashion items in the Australian regions is quite densely populated with having numerous numbers of competitors. Moreover, in the mass market, price is mainly being determined by the market and the profit sharing is very low compared to the niche market. Thus, being operating in the niche market, the profit ratio of Fav will be more and the price will be determined by them rather than by the market. The exclusivity for the brand can also be maintained due to operating in the niche market. I n addition, another advantage that Fav can possess is their diversified product portfolio. In the niche market, they will introduce their products in footwear, clothing and fashion apparel sector. Thus, they can cater to the diversified requirement of the customers. Compared to the mass market, the niche market is much smaller but the main advantage is the high volume of profit being associated with this market. Target segment profiling Being the niche market as the target segment, customer possesses some unique characteristics that are quite different from the customers from the mass market. One of these key characteristics is the snob effect. According to the snob effect, higher end customer tends to buy more of the products which are priced higher (Ghosh and Varshney 2013). In this case, the economical value of the product is being considered as the main buying criterion compared to its utility. As shown in the figure 4, the market expenditure for the luxury items is ever increasing. Thus, customers are spending more in having luxury items. With the enhancement of the Australian economy, the niche market of higher end product is increasing which is an opportunity for the future development. Average customers in this are belonging from affluent background with having high salaried job or business firms. They spend leisure in the weekends and Fav will come up with products which will compliment in their weekend act ivities. Moreover, the average working hours of this segment is less than the mass market customers. Thus, evening leisure is also an important business sector for Fav. They will offer high end party wear also. They prefer offline shopping more than online shopping. However, offline shopping from the exclusive retail outlets is more preferable. Thus, Fav will have their own retail outlets accompanied by experts. This is due to the reason that these customers prefer consultation of fashion experts in their buying process. It is also been noted that they do not buy only the products from the store, rather than they buy lifestyles. Thus, the stores of Fav will be designed to offer a holistic approach to the customers. Thus, Fav can be benefited from this scenario by having implemented the premium pricing for their products. It will be the competitive advantage for them if the products can be priced accordingly and can be maintained as exclusive. It will create a distinct value among th e customers. Porter generic strategies can be applied in this scenario. According to this theory, the first step of having competitive advantage is having the cost or price leadership in the market. However, as Fav is operating in the higher end niche market, thus, cost leadership is applicable (Teeratansirikool et al. 2013). Implementing effective production process and outsourcing the manufacturing facilities to the south Asian countries having low cost production process will help the organization in having the cost leadership in the industry. The second step is focus strategy. According to this strategy, Fav will only focus on their targeted market and the marketing and promotional activities will be that target market oriented. The product will be offered and designed according to the taste and preference pattern of the customers. It will help in enhancing the customer loyalty among the targeted segments. The last step is the product differentiation strategy. According to this strategy, Fav will create a distinctive brand image in the market. The products of Fav will be 100 percent eco-friendly. In addition, a part of the profit from the sales will be donated for the social responsibilities. It will help to create a sense of achievement among the customers. Conclusion Having discussed the market potential of Fav in the Australian region, it can be concluded that they are having a huge opportunities in their targeted segments. Effective implementation of the strategies will help them to tap the market and to stay ahead in the competition. 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