Victoria''''s Secret Presentation

Bienvenido a México, el Secreto de Victoria The Expansion of Victoria’s Secret into Mexico Aparna Donthi Man Tsun Lee Bouphavanh Mathouravong Marisol Rivera Nicole Winkle Research Overview • Primary Research – In-depth survey • Industry Analysis – Demographics – Perfume Industry • United States • Mexico • Company Analysis – Situation Analysis – STP – Marketing Mix • Implementation • Executive Summary • Due to the declining market in the U.S and growth in Mexico, Victoria’s Secret has the potential for a sizeable fragrance market in Mexico • Mexican consumers’ product values are congruent with that of the Victoria’s Secret brand image • Significant similarities and differences in marketing Victoria’s Secret brand in Mexico Primary Research • Bilingual In-Depth Interview – Parallel Translation – Administered in Cuernavaca, Mexico • Goals of the Interview – Awareness of Victoria’s Secret in Mexico – Product Perceptions/Knowledge – P’s – Competitor Awareness Situation Analysis – Mexican Consumers • Highly rank service and price • Have short term view of products – initial price means everything • Receptive to high quality products that are sold in smaller packages – Implications • Victoria Secret offers great service/personal attention to customers • Offers smaller, affordable product selection Perfume Industry Analysis • Perfume Industry in The United States – Perfume industry to grow at declining rate over next five years – Dominated by female fragrances (2/3 of sales) – Male fragrances accounts for 23.5% of market) • Implications – Declining U.S market – Seek International Growth • Mexican Perfume Market Mexican Demographics • Male customers account for 70% of perfume sales despite the fact that men’s fragrances represent 1/3 of the market • Women between 40-50 years can afford to pay $40-$150 for a bottle of perfume • Mexico City represents 52% of sales • Guadalajara and Monterrey have large potential for sales Mexican Market • Perfume Industry in Mexico – “Female Fragrances Experience Dramatic Growth” • 2001 - $253 million • 2006 – Predicted $348 million (37.5% increase) – Many competitors (“Satisfactory sales…suggests…there is still space for new launches…”) – Black market • Relevant to price and distribution Mexican Economy – Increased Purchases of Luxury Commodities • Economic recovery in 1996 • Increase in private consumption – International Companies are increasing their presence Victoria’s Secret (STP) • Positioning – “For the woman who wants to feel sexy, sophisticated, and ultra feminine” • Segmentation – Does not segment based on age – Segment based on products • “various Victoria’s Secret brand fragrances appeal to different aspects of the Victoria’s Secret woman” • Targeting – “Target how a woman feels, rather than her age, ethnicity, or other specific demographic” VS Marketing Implementation • They cross promote between their online and offline operations • “360-degree brand” – connects all selling channels (catalogs, the stores, and website) • Sex appeal is portrayed through advertisements and promotions Expansion into Mexico • Segmentation and Targeting – Highly populated/developed cities • Mexico City, Monterrey, Guadalajara – Product selections to appeal to different tastes and preferences – Low price-sensitivity • Positioning – Provide high quality product that delivers a flawless experience – Creates an image of sensuality and femininity Who and How Old? AGE >18 years MALE (0) 0% FEMALE (1) 6% 19-25 years (3) 60% (6) 52% 26-35 years (1) 20% (2) 18% 36-45 years (1) 20% (2) 18% 46+ years (0) 0% (1) 6% Total (5) 100% (12) 100% •More women between the ages of 1925 responded to the survey Interest Are you interested in receiving a Are you interested in shopping at a Victoria’s Secret store? catalog? Male Female Yes No 40% 60% 100% 0% Male Female Yes No 20% 80% 100% 0% • Women are more apt to put their name on a mailing list to receive Victoria’s Secret catalogs than are men , thus it is important to target women with catalog advertising mediums • Women are interested in shopping at Victoria’s Secret more so than men Tactics emphasizing femininity and sensuality would be appropriate Where and How? 25% Preferred Female Shopping Location 0% 67% • Discount store – Black market 17% 8% 17% Fashion Mags Friends and Family Gift supermarket • Brick and Mortar – Provide service – Provide quality TV Ads department store discount store 8% Media Channels Influencing Product Awareness specialty store 58% •Focus on print ads •De-emphasize online ads Characteristics of Target Market Importance of Price Among Females slightly Typical Amount Paid for a Perfume by Women important 17% 83% 8% $26-$40 >$40 33% 59% • Mexican consumers are willing to pay Victoria’s Secret price-range • Customers are not price-sensitive neither important nor unimportant extremely important Marketing Mix • Product – Victoria’s Secret perfume lines • Price – Equivalent to USD: range between $15-$60 • Place – Open retail stores in major cities – Primary distribution channels: specialty/beauty stores and discount stores • Promotion – Fashion magazines, catalogs • People, Cosmopolitan, Elle • Mailing of 364 million catalogs worldwide – Less emphasis of online sales Goals – Short-term (one year) • Establish test markets in urbanized cities • Monitor sales and product awareness • Evaluate effectiveness of distribution options – Long-term • Evaluate potential production possibilities in Mexico • Gain competitive market share • Evaluate opportunity to expand to lingerie and clothing line Summary • Emphasis on fashion magazines, catalogs, and television ads, not internet • Specialty stores and discount stores • Acknowledge differences in sex roles when promoting – Women are seductive, not assertive and aggressive QUESTIONS? ... Bienvenido a México, el Secreto de Victoria The Expansion of Victoria’s Secret into Mexico Aparna Donthi Man Tsun Lee Bouphavanh Mathouravong Marisol... growth in Mexico, Victoria’s Secret has the potential for a sizeable fragrance market in Mexico • Mexican consumers’ product values are congruent with that of the Victoria’s Secret brand image • Significant... Victoria’s Secret brand in Mexico Primary Research • Bilingual In-Depth Interview – Parallel Translation – Administered in Cuernavaca, Mexico • Goals of the Interview – Awareness of Victoria’s Secret