Good Afternoon Board of Directors,
My name is Heidi Chen Xinyi, and I will be going over the proposed strategy that Urban Outfitters has requested.
To begin the proposal,
I would like to highlight Urban Outfitter's exceptional financial achievement in August 2018,
when its share prices hit a peak, thanks to its successful marketing and retail strategies.
However, in light of the recent reversal in its share prices,
there is a need for Urban Outfitters to implement a strategy that capitalizes on its strengths,
as well as the existing market opportunities, so that it may remain competitive and successful in the many years to come.
Breaking down Urban Outfitters' net sales,
the portion that comes from food and beverage division is significantly lower than that of the three other brands.
This is definitely an area that can capitalized upon to further increase sales.
To do so, I propose opening a premise that serves as both a cafe, and as a fashion store offering its existing clothing brands.
Instead of separating the clothing from food and beverage division,
this strategy combines both of them so that they can complement each other to attract more customers.
This idea would strongly appeal to coffee-loving millennials.
Millennials are Urban Outfitters' greatest consumer base,
as well as the global future of consumers, with an estimated $200 billion of buying power in America alone.
The popularity of coffee among this generation has been growing significantly.
According to research by the National Coffee Association, daily consumption of coffee among 18 to 24 year olds
has increased from 34% in 2016 to 48% in 2017;
this number among 25 to 39 year olds has increased from 51% to 60%.
Therefore, having a cafe and a store in the same premise can attract even more millennials to enjoy the best of both worlds: coffee and shopping.
This cafe can be incorporated into an existing flagship store in Space 15Twenty - Hollywood.
This is the ideal storefront for the initiative because Hollywood has the largest percentage of working Millennials.
The convenient, walkable and lively neighborhood in Hollywood would also allow Urban Outfitters
to attract a higher customer volume.
Since Urban Outfitters already has a well-established online presence and popularity,
it can consider sponsoring celebrities and influencers to promote the new premise on social media
such as Instagram, Snapchat, Twitter and Youtube.
The project will be completed between April and December 2019.
In April 2019, Urban Outfitters would start renovating the Space 15Twenty - Hollywood store,
and also appoint a management team for it.
In May, the company will acquire licenses and permits under the Californian law.
In June, we will source and confirm suppliers, as well as the menu for the in-store cafe.
In August, we will design and announce the opening of the new cafe ground.
In November, we will start reaching out to celebrities and influencers for our marketing strategy.
By December 2019, the construction of the new cafe ground will be completed, and will be ready for its grand opening.
This strategy will not cost more than $300,550.
Additional salaries and wages for new managers and employees will not cost more than $100,000 a year.
Construction costs are estimated to be $100,000 in total.
Both food supplies and equipments for the cafe will cost about $50,000 each.
Sponsorship cost depends on the terms negotiated with celebrities and influencers,
but is likely to be less than $500 due to Urban Outfitters' high popularity on social media,
especially Instagram and Snapchat, and hence, its appeal to these celebrities and influencers.
Licensing and permits do not cost much, and are likely to be about $50.
Overall, this budget is manageable, feasible and of considerably low-risk.
Urban Outfitters has been in a very good financial position over this past year.
To remain competitive in the many years to come, the company can definitely
consider investing in this strategy to further improve its appeal, especially to millennials.
Furthermore, this strategy aligns with the our identification as a "passionate, creative, and entrepreneurial bunch,"
as well as our dedication "to inspiring customers through a unique combination of products, creativity and cultural understanding."
With that being said, I would like to thank the board for your attention, as well as the opportunity to present this proposal.
Thank you very much.
Không có nhận xét nào:
Đăng nhận xét