Situation Analysis

Levi Strauss and Company is approaching to the saturation of Jean Market. The fast changes
in the consumer tastes, competition from both lower and high-end brands, the fast
development in the modern distribution and sales technology has brought a continuous lose
of market share.
A new series of Engineered Jeans has been developed and launched as part of program
intending to meet the needs of their major target, in order to regain lost marker share and
maintain their position the industry. Their expertise in Jeans and causal dress industry will be
fully exploited at world basis.
This year, they intended to strengthen the promotion of this new brand. Certain resources
will be allocated to their existing brands, to maintain market share of 501, enlarge market
share of Dockers and slates. Communication with their customers is important for us. They
will also improve their relation with them, and track the changes in the taste and need of
their main target market. Information system will also be improved to enhance their ability
to adapt the market change.
On the other side in the Pakistan Levi Strauss & Co is facing few problems. Here due to
decrease n the income level of the people people are not in this condition to buy high priced
products of Levi Strauss & Co. Other issue is that the local manufacturers use the tag of
highly reputed brands thats why consumer traped and purchase these products.

Completive Analysis:
Levi Strauss & Co. was threatened by competition, because barriers of entry were relatively
low in the jean market. (excluding the of entry were relatively low in the jean market.
(excluding the patent) patent)

Some of Levi Some of Levis competitors include: s competitors

include:

Calvin Klein

Gap Jeans

Denim Jeans

Stone age

Tommy Hilfiger

The entrance of new competitors had many effects on Levis.

Levis no longer has monopoly power so now they have to set more competitive
prices due to that lower profits they gain.

Availability of substitutes firm faces increase in elasticity of demand

The prices of competitors products are lower so consumers prefer other brands. So
when their consumers purchase products from the competitors its minimizes its
market share.

Competitors successfully were able to take from Levis market due to heavy
advertising and branding. . Branding was especially effective for companies like
Calvin Klein that targeted high-end consumers.

Some of the marketing strategies that competitors like Calvin Klein used to
differentiate their product and brand included:
Celebrity endorsements (Calvin Klein and Brooke Shields)
Up Up-to to-date European product designs (low rise, tighter)
Advertise jeans as designer.

These advertisements were used as a barrier to entry, because of spurious product

differentiation. Although Levis jeans may physically the same as its competitors,
consumer preferences are affected by brand name.

Current Market Need:

Its not just how good a product is that determines if consumers will buy it. Many
people find themselves motivated by several factors when that all-important decision
to purchase a specific product is made. For us it is as simple as comparing the prices,
but many others there are many emotional factors that weigh heavily on their
decision. Does this product make me feel good about myself? What image does this
product present me with? What effect will owning this about myself? Consumers ask

themselves questions such as these when making decisions about whether or not to
buy something.
Do people want to be like someone they see in as advertisement? This question is the
basis for marketing, particularly in the clothing industry. Buyers over the years have
liked the rugged. Confident, individualistic and laid back image that Levis give them.
This image, which has been created through the companys intelligent marketing
scheme, has allowed to company to maintain its prosperity over the year.

SWOT Analysis:
Bases on the Levis Strauss unique resources and capabilities as to be the first mover
in the industry and one of the ten top US recognized brand name has continue
developing new products (as the Jacket with MP3) and looking after new markets this
will allow to adapt to the fast consumers taste changes and to move away from the
saturation of the jeans market.

Strengths:

History

Pioneer in Jeans

Levis enjoys high brand equity. People all around the world recognize the
brand name.

Levis products are unique and innovative in the style.

A lot of variety is offered by Levis ranging from sunglasses to skirts and

shirts.

Diversity

The products are renowned and are considered as the most durable i.e. the
long lasting products.

Levis follows a high standard of quality.

Expertise in jeans industry

Finance and access to international markets

Its highly expertise and intelligent management

Distribution channels and Global sourcing

Weaknesses:

Levis products are considered as very expensive. Therefore a large

percentage of people are reluctant to buy the products.

As no discounts are present and products are sold at fixed prices many
customers are lost.

Levis does not provide any services like free delivery etc

Lack of control on distribution decisions ( Retailers pressure to stop selling

on web)

Opportunities:

Levis can do more well in the women section. This section is give less importance as
compared to the men section.

The kids section, which has been started from few years, should also be given proper
attention to gain customers.

Sales promotion can be increased by increasing the advertisements expenses so as

to enjoy a large number of customers.

Low manufacturing and production cost in various international markets like Pakistan
and Bangladesh.

Threats:

Saturation of jeans market.

Local competitors in expanded markets

The threats that Levis faces are the competitors. Although it does not have any
competitor in Pakistan but it does have some competitors at the global level.

Fast change in the consumer taste.

Economic downfall in many countries like Pakistan.

KEY PLANNING DECISIONS

Marketing Objectives:
To improve leadership market position and superior product and service
To maintain and protect the global brand
Increase the market share in products by annual average of 12.8% in the next five
years.
Also, to maintain the global market share of denim products in the same period.

Advertising objectives:

To inform, persuade and remind the potential customers about its products

Increase awareness and build primary demand

To build strong brand equity.

Build Companys image as innovator.

To create bonds between public and Levi Strauss by helping the people.

To create the importance of its products

SCANNING THE MARKETING ENVIRONMENT:

Like other successful companies, Levis also has realized that the marketing
environment presents a never-ending series of opportunities and threats. The major
responsibility for identifying significant changes in the macro environment falls to a
companys marketers. More than any other group in the company, the marketing managers
of Levis are the trend trackers and opportunity seekers. Many opportunities are found by
identifying trends (directions or sequences of events that have some momentum and
durability) and mega trends (major social, economic, political and technological changes
that have long-lasting influence). Within the rapidly changing global picture, the marketers
of Levis are monitoring the following six major Environmental Forces:

Demographic Environment

Economic Environment

Natural Environment

Technological Environment

Political-Legal Environment

Social-Cultural Environment

Products, Positioning, and Market Segmentation:

Advertising professionals realize that the heart of any campaign is the product and the
position it holds in people's minds. Products and their brand names are newsmakers
themselves. Understanding the complexities of a brand identity and its position is no easy
task. One of the most controversial areas of product concepts is the brand extension. A new
product gets to share the name of an older, established brand. Early theorizing suggested
that brand extensions would sap market clout from the established product, but these fears
proved groundless. Today brand extensions occur not only within the company, but
companies are licensing their brand names to all kinds of products in the hope of increasing
brand awareness.

Target Audience- basis for segmentation:

Market Segmentation:
Segmentation is the basis for developing targeted and effective marketing plans.
Furthermore, analysis of market segments enables decisions about intensity of marketing
activities in particular segments. A segment-orientated marketing approach generally offers
a range of advantages for both, businesses and customers.

Market segmentation is the selection of groups of people who will be most receptive to a
product. The most frequent methods of segmenting include demographic variables such as
age, sex, race, income, occupation, education, household status, and geographic location;
psychographic variables such as life-style, activities, interests, and opinions; product use
patterns; and product benefits. Much segmentation involves combinations of these methods.
No matter how segments are defined, however, they are characterized by considerable
change over time. The readings in this section exemplify areas of rapid change.

BASIS OF MARKET SEGMENTATION

Levis Strauss Company segments its market on different basis. The detail of each segment
given below in detail:

Demographic Segmentation
Theres little excuse for being surprised by demographic developments. The main
demographic force that marketers monitor is population, because people make up
markets. Marketers are keenly interested in the size and growth rate of population in
cities, regions, and country; age distribution and ethnic mix; educational levels;
household patterns; regional characteristics and movements. The company makes
clothes foe men, women, children & teens. So everyone is a potential customer for
LEVIS. LEVIS generally appeals to more mature generations not necessarily looking to
make fashion statement. LEVIS makes an effort to appeal to all
Customers in one way or another, which has been a key to their success over the
years. Assuming that the world population is growing LEVIS can infer that the market
for jeans is also growing.
Consist of dividing the market into groups bases on variables such as age, gender,
family size, income, occupation, education, religion, race and the nationality. Levis
Strauss Companys main segmentation variables are summarized below:
Age:
Few years ago Levis Strauss Company segmented its customers according to
their age. Its provides all type of brands for the people of all ages for example
Levis Strauss Company has huge product line from children to old people. The
target audience is the young people who wear jeans as fashion. On the other
hand the because LS & Co offer products for all

ages so mature and old

people are also come under age segmentation of target audience.

Gender:
Gender segmentation of Levis Strauss Company is for male and females. They
manufacture brands for both genders.
Income:
High income people are come in this segmentation. The prices of Levis Strauss
Company is high so they only target those people who earn a good income
and afford to purchase the brands.

 Occupations:
In the occupational segmentation they have segmented their market in
different ways. Students, professionals, business men & women and
executives.
Education:
Well educated people.

Geographic Segmentation
Geographic segmentation calls for dividing the market into different geographical
units such as nation, states, regions, countries, cities, or neighborhoods. The
company can operate in one or a few geographic areas, or operate in all but pay
attention to local variations. Levis Strauss Company has segmentise ite market
accordint to region that are given below:

Levi Strauss Americas

Levis Strauss Americas in the companys largest region. The Americas region
markets products under the Levi's, Dockers and Levi Strauss Signature
brands and includes four businesses: Levi Strauss U.S., Levi Strauss Canada,
Levi Strauss Mexico, and Levi Strauss Latin America.
Levi Strauss Europe, Middle East and North Africa
Levi Strauss Europe, Middle East and North Africa (LSEMA) is responsible for
designing, manufacturing and
Countries in this Region:
LSEMA markets and sells products in the following countries: Albania, Algeria,
Andorra,

Austria,

Azerbaijan,

Bahrain,

Belarus,

Belgium,

Bosnia

and

Herzegovina, Bulgaria, Croatia, Cyprus, Denmark, Egypt, Estonia, Finland,

France, Germany, Greece, Georgia, Hungary, Iceland, Ireland, Israel, Italy,
Jordan, Latvia, Liechtenstein, Lithuania, Luxembourg, Kazakhstan, Kuwait,
Kyrgyzstan,

Malta,

Mauritius,

Moldova,

Monaco,

Montenegro,

Morocco,

Northern Cyprus, Norway, Oman, Poland, Portugal, Qatar, Romania, Russia,

San Marino, Saudi Arabia, Serbia, Slovakia, Slovenia, Spain, Sweden,

Switzerland, The Czech Republic.
Levi Strauss Asia Pacific Division:
Levi Strauss & Co.'s Asia Pacific Division is comprised of subsidiary businesses,
licensees and distributors throughout Asia Pacific, the Middle East and Africa
The division sources, manufactures and markets Levi's, Dockers, and Levi
Strauss Signature products through affiliates.
Countries in this Region:
India, Indonesia, Japan, Singapore, Pakistan, Philippines, Korea, Malaysia ,
Taiwan, Vietnam.

Psychographic Segmentation
Basis of Psychographic Segmentation are given below:
Life style
Activities
Interests
Personality
Values

Behavioral Segmentation
In this segmentation following segments are consider by Levi Strauss Company:
Occasions
Brand loyalty
Usage rate
Benefits

Segmentation

Data

Variables
Geographic

World region

Asia

Country

Pakistan

Cities

All major cities of Pakistan

Density

Urban

Demographic

Age

All Ages

Gender

Male, Female

Family Life Cycle

Young , Single; Young, Married, no children; Young,

Married with children; Older, Married with children;
Older, Married with no children under 18; Older, Single;
Other

Income

15000 and above

Occupation

From middle class to upper class

Education

Schools, College, Universities

Religion

Major religion of Islam, Christianity

Race

Asian

Nationality

Pakistani

Psychographic

Social class

Working class, Middle class, Upper class.

Lifestyle

Actualizes, Fulfilled, Believers, Achievers, Strivers,

Experiences makers and Strugglers

Behavioral

Occasions

Parties, Birthdays, Regular Islamic Occasions

Benefits

Quality, Style, prestige, Durability

Attitude towards product

Positive

User Status

Regular users and new users

Target Market:
Once the firm has identified its market-segment opportunities, it has to decide how many
and which one to target. Levi Strauss has oppertunies in different segmentation. They target
its market according to their brands and relating segmentation. In evaluating different
market segments, the firm must look at two factors: the segments overall attractiveness
and the companys objective and resources.
Because we are making advertising plan to keep the market of 501 JEANS targets its
market by evaluating different segments. Mostly Levis targets its market among the
following classes:

Upper Class
People who belong to this class they always to experience those products which
provide them prestige and quality products. Due to high income class they do not
consider the price factor. So Levis is the brand that has eared popularity throughout
the world and it is symbol of prestige and quality which is demanded by this class. So
Levi Strauss Company is targeting this class and people from all age rang and both
genders will be targeting from this class.

Upper Middle Class

In this class people having good education professionals and corporate executives
and business owners belongs. They have a great touch with the world and have good
income. They can afford to wear costly products. So people from this class will also
targeting.

Target Market Strategy:

Target market strategy adopted by Levis is basically on having long-term relations with
their customers and to provide them with better product. Through their good quality
products and best services they always attract customers.

Benefits of Segmentation:
Levis has got customer oriented approach by segmentation.
Company is promoting its products effectively within segments by print media as well
as electronic media, e.g. Newspapers, Signboards, Television commercials, Internet,
etc. Company is providing their customers with stylish better quality and different
product keeping in view its cost.

Conditions for effective segmentation:

JEANS is fulfilling the conditions for effective segmentation.
Segments are strong enough to make profit.
Segments of company are measurable

Limitation of Segmentation:
Because of segmentation, Levis faces some limitations.
Lack of awareness in middle class.
Company has to pay extra cost for multi-advertisement.

In Pakistan they have to face several Cultural Barriers.

Marketing Research:
According to Levis marketing logistic manager, their company conducts a research to know

Whats in trend?

What are the needs of customers?

Sources of Data:
Levis gathers data from both primary and secondary sources. Secondary data is
already available in the company. To gather primary data, they organize radio shows and
music concerts by sponsoring.

MARKETING MIX
The marketing mix is the set of marketing tools the firm uses to pursue its
marketing objectives in the target market. Marketing-mix decisions must be made for
influencing the trade channels as well as the final consumers. McCarthy classified these
tools into four broad groups that he called the four Ps of marketing: product, price, place and
promotion. Note that the four Ps represent the sellers view of the marketing tools available
for influencing buyers.

PRODUCT:
Product means set of tangible and intangible attributes which may include packaging, color,
price, quality and brand plus the sellers services and reputation. A product may be a place,
service, good or promotion.

BRANDS:
Brand is a name, term, sign, symbol or design that adds value to the products. LS & CO.
earns remarkable revenues throughout the year coz its products are considered to be the
worlds largest quality products.LS & CO. is basically divided into 3 sub brands i.e. Levis,

Dockers and Levis Strauss Signature. All the three brands are providing different quality
products.

PRODUCT ATTRIBUTES:
Products are usually considered to be the No.1 factor contributing towards building goodwill
of a firm. A product should be unique, durable, reliable, comfortable and economical.
Following are some of the basic attributes of LS&CO.S product

Variety

Features

Design

Color

Size

VARIETY:
Levis products today are perceived by many as a symbol of youth, freedom, confidence,
individualism, independence & comfort. LS & CO. provides a wide variety of products
including:

Competitors:
We are much proud to say with surety that our products completely satisfy our consumers,
thats why we dont face much competition in our business. But yet there are some
competitors e.g.

CK

GAAP Jeans

Stone age

Tommy Helifiger

Our prices are not influenced by the competitors.

Such a stuff, design and fashion which dont have the enough sales are recall back to
the company.

Brand Positioning:
Positioning differs between countries and market segments. For example, in America and
much of Europe the emphasize is on jeans as casual attire. In contrast, Pakistanis wears
indicates to social fashion awareness and high status,
For adolescents and youngsters adults ( 14 to 24) who want casual attire, engineers jeans by
Levis provide a unique fit and functional status, unlike other competitors.

Brand Personality of Levis:

Brand personality is a set of human charectraristics associated with a brand. Personality is
how the brand behaves. Refers to the outcome of all the consumers experiences with the
brand, in other words, the brand personality is the weighted average of previous
impressions. In the consumers mind, these impressions merge to form an overall concept of
what to expect from brand. We can define brand personality of Levis as Rebellion,
sensuality and being cool.

Features Analysis of Levis with its competitors:

Sr

Important

Prospect

to

Levis

CK

Gap

Stone Age

TH

Quality

Price

Style

++

Availability

--

Prestige

++

Competitive Advantages
Levis never compromises on quality.
Levis

products are available in cities and towns where it has more

demanded.
Levis is using the latest technology in its production units.
Levis offers a wide range of products available in its outlets.