do onething aday thatscares you

most

lovelife is full of setbacks success is determined by how you handle setbacks

effectiveness is predicated by replacing the words “wish”, “should” and “try” with “i will”

live near the ocean and inhale the pure salt air that flows over the water (vancouver will do nicely)

the conscious brain can only hold one thought at a time

choose a positive thought

drink

fres

h wate

r an

d as m

uch

wate

r as y

ou ca

n. fre

sh w

ater

flush

es to

xins

from

your

body

and

keep

s you

r brai

n sha

rp.

have you woken up two days in a row uninspired? change your life!

do not use cleaning chemicals on your kitchen surfaces. someone will inevitably make a sandwich on your counter.

visualize your eventual demise. it can have an amazing effect on how you live in this moment.

don’t trust that an old age pension will be sufficient

your outlook on life is a direct reflection of how much you like yourself

what you do to the earthyou do to yourself

the world moves at such a rapid rate that waiting to implement changes will leave you two steps behind. do it now, do it now, do it now!

observe a plant before and after watering and relate these benefits to your body and brain

write down two personal, two business and two health goals for the next 1, 5 and 10 years. do this four times a year. goal setting triggers your subconscious computer.

children are the orgasm of life. just like you did not know whatan orgasm was before you had one, you won’t know how great children are until you have them.

creativity is maximized when you are living in the moment

©2012, lululemon athletica, Inc.

communication is complicated. each family has slightly different definitions of every word. an agreement is an agreement only if each party knows the conditions for satisfaction and a time is set for satisfaction to occur

sunscreen absorbed into the skin might be worse for you than sunshine. get the right amount of sunshine.

salt +

high

fruc

tose

corn

syru

p + bu

tter =

early

death

stress is related to 99% of all illness

danc

e, s

ing,

flos

s an

d tr

avel

friendsmoneyare more

listen listen listenthen ask strategic questions

important than

this is not your practice life.this is all there is sweat

that which matters the

should never give wayto that which

leastmatters therel

ation

ships

real

allow

s for

frien

ds10

-15

happiness the pursuit of

is the source of all unhappiness

the p

erfec

t

would

read

:

jealousyopposite

works

way you want it tothe

tomb

stone

breathe and appreciate the moment.

deeplyliving in the moment couldbe the meaning of life. pra

ctice

yoga

so yo

u can

rema

in ac

tive

in ph

ysica

l spor

ts as

you a

gea daily hit of athletic-inducedendorphins gives you the powerto make better decisions, helps you be at peace with yourself, and offsets stress

‘all usedup’

nature wants us to be mediocre because we have a greater chance to survive and reproduce. mediocrity is as close to the bottom as it is to the top, and will give you a lousy life.

once a day to regenerate your skin

!

Improved Product and Marketing Strategy Will Regain Consumer Confidence

Mai-Vi Nguyen BS in Commerce

November 10, 2014

Table of Contents

Lululemon should expand youth brand and e-commerce to compete with Nike and Lucy………1 Six-month marketing plan should focus on SeaWheeze and social media marketing……………1

Lululemon should partner with Amazon, Nordstrom, and Equinox to sell merchandise…….......2

Fall 2015 merchandise assortment should include relatively more men’s and children’s………..5 Lululemon should maintain higher prices and improve service and product quality………….….7

Six-month Open-to-buy will bring in majority of receipts in preparation for holiday season……8

Pop-up stores should be located in the most physically active cities and college towns…………8

Conclusion………………………………………….……………………………………………..9

Appendix A: SWOT Analyses of Lululemon, Lucy Activewear, & Nike………………………11 Appendix B: Six-month Marketing Plan (August 2015-January 2016)…………………………13 Appendix C: Fall 2015 Merchandise Assortment Plan…………………………….…………….14 Appendix D: August 2015 to January 2016 Open-to-buy Plan………………………………….15 Reference List……………………………………….…………………………………………...16

! 1 !

The fashion industry constantly adopts and abandons trends. For the past few years

though, stylish athletic wear has been on the rise and is continuing to grow. Lululemon Athletica

particularly paved the way in the yoga segment of this market, but it’s faced many challenges

recently that have caused consumers and investors to lose confidence in the brand. In this case

study, I will analyze the competitive landscape to identify areas where Lululemon can

differentiate itself. Then I will recommend a six-month marketing plan and three retailers that

Lululemon should partner with. Finally, I will explain the details of the merchandise assortment

plan, price analysis, six-month open-to-buy plan, and pop-up store strategy.

Lululemon should expand youth brand and e-commerce to compete with Nike and Lucy

Two of Lululemon’s key competitors are Nike and Lucy Activewear. After conducting a

SWOT analysis of the three brands, Lululemon has a stronger competitive position than Lucy,

but not Nike (Appendix A). In order to increase its market share, Lululemon should continue to

develop its youth brand, Ivivva Athletica, and e-commerce or direct-to-consumer (DTC)

channels. Ivivva differentiates Lululemon because Lucy does not have a children’s brand and it’s

more unique than Nike’s children’s offerings (“Lucy”). Nike’s children’s products look like

smaller versions of their adult products, but Ivivva specifically offers dance-inspired products to

girls, which is a unique niche in the market (“NIKE”). More details on Ivivva will be in the

merchandise assortment section. Also, Lululemon must expand its e-commerce presence in

response to the industry trend of customers shopping online more. A recommendation on how

Lululemon can do this will be in the retail partnerships section.

Six-month marketing plan should focus on SeaWheeze and social media marketing

From August 2015-January 2016, Lululemon’s marketing plan should include expanding

the SeaWheeze half-marathon event to Washington, D.C.; sponsoring fashion blogs; and signing

onto the new Instagram service, Like2Buy. The total estimated cost is $980,000 (Appendix B).

! 2 !

Since 2013, Vancouver, Canada has been home to Lululemon’s SeaWheeze half-

marathon and it’s become an extremely high-demand event; thus, expanding it to Washington,

D.C. in August 2015 will generate a great deal of positive PR, social media buzz and content,

and word-of-mouth marketing in the US. Lululemon describes SeaWheeze as more of a

“yoga.run.party” weekend affair with yoga classes, the half-marathon race, and the Sunset

Festival afterwards. The 2014 Vancouver SeaWheeze drew 10,000 runners and tickets for the

2015 event sold out in 36 minutes (“Aims to Woo”, 2014). These statistics indicate the

popularity and success of SeaWheeze, but testing it out in DC on a smaller scale of 5,000 runners

will be less risky. The estimated cost is $900,000.

Partnering with fashion bloggers to sponsor posts over the six months, a form of

influencer marketing, will reach millions of their dedicated followers and generate more sales.

Emily Schuman of Cupcakes & Cashmere and Chriselle Lim of The Chriselle Factor are both

good fits with Lululemon because they represent an elevated, healthy, and stylish everyday

lifestyle. Each blogger would charge about $25,000, so the total estimated cost is $50,000.

Lululemon should apply Like2Buy, a new service that links Instagram to traffic and

revenue, to make its Instagram “shoppable” and monetized. Since Instagram only allows one

clickable link on each user’s profile, Like2Buy would generate a specific link for Lululemon that

displays a grid of Instagram pictures featuring products available for purchase. When customers

click on a picture, they are led to the specific product page on Lululemon’s website where they

can then purchase the product. Like2Buy also allows users to create a wishlist/shopping cart of

“liked” pictures. This service costs about $5,000/month, so the total over six months would be

about $30,000 (O’Connor, 2014).

Lululemon should partner with Amazon, Nordstrom, and Equinox to sell merchandise

! 3 !

To re-introduce the brand back to consumers, Lululemon should form partnerships with

Amazon, Nordstrom, and Equinox to broaden its customer reach. Amazon has one of the largest

e-commerce customer bases; Nordstrom’s outstanding customer service attracts loyal customers;

and Equinox targets dedicated, trendy workout enthusiasts.

As in-store sales continue to decline, Lululemon should strengthen its DTC sales by

partnering with Amazon, one of the biggest e-commerce companies. From 2012 to 2013,

Lululemon’s store sales growth declined from 16% to 2% (“Annual Report”, 2014). Thus, it is

clear that Lululemon should focus on developing its DTC sales more, and selling Lululemon

merchandise through Amazon is an optimal solution. Amazon Fashion has been a growing

segment of Amazon’s business because of its fashion-conscious, high-demo customers.

Customers appreciate the wide selection and ability to test the merchandise through detailed

photos, video clips, and free returns. In addition, Amazon is now starting to extend its Amazon

Prime perks to outside retailers, and this would be an ideal partnership for Lululemon.

Amazon recently struck a deal with AllSaints, the mid-size British fashion retailer, to

provide free, next-day shipping to Prime members when they make purchases on AllSaints.com.

Now when customers are searching for AllSaints products online, they can find them on

Amazon. Once they’re on Amazon.com, customers will have to click through to be redirected to

AllSaints.com. When they’re ready to order, they can log in with their Amazon account and pay

through Amazon to qualify for free, next-day shipping. For every purchase made through

Amazon, Amazon charges AllSaints a small fee, but does not take a cut of the sales. This is

beneficial to AllSaints because there are about 50M Prime members worldwide and Prime

members spend double the amount that non-Prime members do in a year (Duryee, 2014). In

addition, Amazon is very confident in the benefits of this partnership for the retailer. Amazon is

! 4 !

guaranteeing it will drive more sales to the retailer’s site within 30 days or it will reimburse the

retailer for the fees it collected on up to $100,000 in transactions (Del Rey, 2014). Performance

has indeed met these promises since checkout time on AllSaints.com has been reduced by one

minute and sales have increased.

Nordstrom would be another ideal retail partner to re-introduce Lululemon to consumers

because of its wide range of merchandise and famous dedication to customer service. Nordstrom

has a very diverse customer base since it carries contemporary brands, like Joie and French

Connection, to high-fashion designers, like 3.1 Philip Lim and Valentino. In addition, it has an

extensive athletic wear department. Nordstrom carries big-name brands like Nike and The North

Face, but also yoga brands like Alo and Zella. Thus, Lululemon’s mix of yoga and all-around

athletic wear would fit in with Nordstrom’s current activewear department. Finally, Nordstrom is

renown for its superb customer service (“Nordstrom”). Since Lululemon has been facing several

problems with customer service recently, partnering with Nordstrom would more assuredly

guarantee customer satisfaction.

Finally, Equinox fitness clubs would be another effective retailer because it targets a

similar market of wealthier, trendier workout enthusiasts (most clubs have “The Shop” where

workout gear is sold). Equinox was voted Best Gym in America by Fitness Magazine, but

“Equinox isn’t just a fitness club, it’s a temple of well-being” (“EQUINOX”). Equinox’s

dedication to an overall healthy, active lifestyle aligns with Lululemon’s philosophy of “creating

components for people to live longer, healthier, fun lives” (“Annual Report”, 2014). This

similarity is a valuable and important synergy when choosing a company to partner with. In

addition, the Equinox member is very similar to the Lululemon customer. Equinox attracts

working adults in the 20s-30s age range in urban cities who are willing to pay a premium to join

! 5 !

a more luxurious, trendy fitness club. These members are more avid workout enthusiasts who

care more about their appearance than an average gym’s members. Thus, they’re more likely to

spend more money on high quality, stylish athletic gear, like Lululemon’s.

Fall 2015 merchandise assortment should include relatively more men’s and children’s

Lululemon’s merchandise assortment plan for fall 2015 should consist of 45% women’s;

30% children’s, or Ivivva Athletica; and 25% men’s products. With the women’s athletic wear

market becoming increasingly saturated and growing sales for Lululemon’s men’s and Ivivva

lines, this assortment breakdown predicts continuing increased sales for men’s and Ivivva.

Men’s sales will continue to increase as men’s yoga becomes more popular through

heightened awareness and availability of male-focused yoga classes. At the beginning of the

2013 football season, the Seattle Seahawks proudly announced that yoga became a mandated

part of workouts after players enjoyed it so much as an optional activity the previous year

(Roenigk, 2013). Men’s participation in yoga continues to gain publicity through male yogis like

Patrick Beach and Dylan Werner. Both have strong social media presences and have partnered

with Lululemon recently (Herbst, 2014). In addition, not only are gyms and studios offering

more male-focused yoga classes, like AcroYoga (which requires a male and female), but there

are even programs that are specifically geared toward men, like Broga. Since opening in 2009,

Broga has now expanded to 65 locations across the US and Europe and will open more in the US

and Canada as well (“Broga”). Consequently, men’s overall participation in yoga has grown in

the past few years to 27% in 2013 (Herbst, 2014).

Accordingly, Lululemon’s men’s sales have increased and are predicted to follow this

trajectory. Second quarter 2014 results showed that men’s sales grew 5%. Although girlfriends

or wives may make some of these sales, boyfriends and husbands are following them into the

! 6 !

store, increasing the chances of future purchases. In addition, Lululemon is so confident in the

growth of men’s that it’s opening its first standalone men’s store in Soho, New York City by the

end of 2014 (Kell, 2014). For these reasons, a 25% share of the fall 2015 merchandise

assortment seems reasonable. January 2013 sales figures indicated that men’s sales only

accounted for 12% (“Reaches out”, 2013). However, this is a very outdated number and

quarterly results since then have shown significant growth.

Ivivva Athletica, Lululemon’s girls’ brand targeted at 6-12 year-olds, will account for

30% of the fall 2015 merchandise assortment in response to popular teen trends and growing

sales. Pipar Jaffray, an investment and asset management firm, released their semiannual 2014

report on teen spending and “leggings/lululemon” was the top fashion trend among girls with

26% of responses. In contrast, “crop tops” came in second with only 6%. Yoga pants are

increasingly replacing jeans, indicating the entire consumer industry’s shift toward a more

comfortable lifestyle (Lutz, 2014). These trends were reflected in Ivivva’s 17% sales growth in

2013 and 36% sales growth in the second quarter 2014. In addition, a total of 10 new stores and

20 new showrooms will have opened by the end of the year (“Aims to Woo”, 2014).

Lululemon currently does not carry unisex products, but it should not consider

developing a unisex line either. Unisex athletic wear would not be successful because athletic

wear is meant to facilitate and optimize your body’s physical ability. However, men and women

have very different bodies and thus, very different needs for athletic wear. For example, Under

Armour struggled for many years to create a successful women’s line because of its “shrink it

and pink it” strategy. The company essentially took men’s pieces, shrunk it to women’s sizes,

and then offered it in pink (Olson, 2010). On the other hand, Lululemon has effectively

developed its men’s products and should stick to distinct women’s, men’s, and children’s lines.

! 7 !

Lululemon should maintain higher prices and improve service and product quality

Upon conducting a price analysis, Lululemon’s prices are all-around relatively much

higher than its key competitors, Nike and Lucy. However, Lululemon should not try to compete

on price and should focus its efforts on improving customer service and product quality.

Across all three departments, Lululemon’s prices are higher than Nike and Lucy.

Women’s Men’s Children’s Average percent Lululemon’s prices are higher than Nike and Lucy, or *Nike

37.6% *27.4% *27.4%

I conducted this price analysis by first finding the average price of each product category (i.e.,

outerwear, tank tops) for each brand’s departments. Then I calculated how much higher in

percent Lululemon’s prices are for each product category and averaged these percentages for

each department. Since Lucy only carries women’s products, the prices for men’s and children’s

are only compared against Nike (“Lucy”) (“NIKE”).

Although Lululemon’s prices are significantly higher than its key competitors, it should

not lower prices and should instead focus on improving product quality and customer service.

Lululemon has positioned itself as a premium athletic gear brand that “elevat[es] the world from

mediocrity to greatness” (“Lululemon”). If it were to lower prices, customers would perceive the

quality also lowering and consequently, Lululemon lowering itself to be a more entry-level

priced brand. Especially since Lululemon has been facing many problems and customer

complaints about quality in recent years, it should focus on improving the product so it can

restore customers’ confidence in its innovative, durable designs.

First, Lululemon should invest more to its R&D, product development, and quality

control efforts. The company differentiates itself with its technical, innovative athletic fabrics, so

it needs to ensure that the quality lives up to this reputation and the price of the products.

! 8 !

Especially when Nike is continually launching new fabrics like the Tech Fleece, Lululemon must

also push itself to constantly innovate. Improving quality control before products are distributed

to retailers is also very important, especially after the see-through yoga pants controversy. These

additional investments are necessary to regain consumer confidence and avoid additional costly

product recalls or PR scandals.

Once the products have been improved, Lululemon will need to publicize this better

product and its dedication to customer satisfaction. Lululemon already has a “quality promise,”

but it should be more widely advertised with the PR for the new fabric technology

(“Lululemon”). Customers will also be more willing to purchase these new products with the

guarantee of customer satisfaction. In addition, this superb customer service will align with

Amazon and Nordstrom, two of the retailers Lululemon should partner with.

Six-month Open-to-buy will bring in majority of receipts in preparation for holiday season

For the open-to-buy from August 2015 to January 2016, the months that will bring in the

most receipts will be November and December due to the holiday season. Since the retail

industry is highly affected by seasonality, relatively more sales are experienced during the 4th

quarter around the holiday season (“Annual Report”, 2014). In order to plan the open-to-buy, I

first predicted sales using an industry calculated estimated revenue growth rate of 16%

(“NASDAQ”). Then I calculated the average markdown percent from previous inventory

numbers (“Annual Report”, 2014). Details of the open-to-buy are in Appendix D.

Pop-up stores should be located in the most physically active cities and college towns

Creating a pop-up store in Riverside, California will be an ideal location to re-introduce

Lululemon to the customer because of its top athletic ranking and minimized risk being in the

California market. Every year, the American Fitness Index releases a data report that ranks the

top 50 healthiest and most fit cities in the US. In 2014, Riverside, California ranked 28th

! 9 !

(“Washington, D.C.”). Out of all 50 cities, Riverside is the only one where Lululemon does not

have a store or showroom. With such a huge, untapped market of physically active customers,

opening a pop-up store in Riverside will maximize brand exposure and sales. In addition,

California has 30 Lululemon stores, the most out of all states (“Lululemon”). This minimizes

risks of opening a new store in Riverside because Lululemon is already very familiar with the

California market.

If the Riverside location proved successful, more pop-up stores should open in College

Station, Texas; State College, Pennsylvania; and Eugene, Oregon. College Station, Texas is

home to Texas A&M University, the #1 most fit college in the US. With 58,000 students and the

closest Lululemon store 1.5 hours away, there’s a tremendous market of potential customers.

Similarly, State College, Pennsylvania is home to Pennsylvania State University, the #5 most fit

college (“50 Fittest”). It’s one of the biggest colleges with 98,000 students enrolled. The closest

Lululemon store is 2.5 hours away, so there’s another huge untapped market there. Although

Lululemon’s primary customer is an older, working woman, many millennial college students

highly value quality products like Lululemon and are willing to pay a premium.

Finally, Eugene, Oregon would be another ideal city to open a pop-up store. It’s currently

the #2 best running city, proving its nickname, “Track Town, USA.” Eugene is also the 2nd

largest city in Oregon and home to one of the most famous track & field stadiums, Hayward

Field (“10 Best”). Although Nike was founded in Eugene, it does not dominate its athletic wear

market. Thus, Lululemon should test out this running-centric market with a pop-up store.

Conclusion

In conclusion, this proposal provides solutions to many of the marketing, product,

customer service, and financial problems Lululemon has been facing in the last few years.

! 10 !

1. The six-month marketing plan utilizes experiential and grassroots marketing to bring the

successful SeaWheeze half-marathon event from Vancouver to a US location,

Washington, D.C.; influencer marketing to partner with reputable, compatible fashion

bloggers; and social media marketing to drive sales from Instagram.

2. Forming partnerships with Amazon, Nordstrom, and Equinox will re-introduce

Lululemon back to current consumers and reach potential new customers. These three

retailers strategically span three unique markets, better ensuring maximum exposure and

sales: e-commerce, department store retailer, and fitness club.

3. The proposed fall 2015 merchandise assortment plan accommodates the increasingly

oversaturated women’s athletic wear market and predicts continued growth in men’s and

Ivivva Athletica sales. This diversification allows for more sustainable growth.

4. After conducting a price analysis, it’s clear that Lululemon should not try to compete on

price, but rather it should focus on improving its product quality and customer service.

5. The six-month open-to-buy plan from August 2015 to January 2016 suggests a 16%

revenue growth rate and relatively higher seasonal sales during the holiday season.

6. Opening pop-up stores in top fitness cities and college campuses will appeal to

Lululemon’s target consumers while expanding to untapped markets.

Following this multi-faceted plan will restore consumers’ confidence in Lululemon and put the

company back on its growth trajectory. Lululemon spearheaded this booming athletic wear

market and refocusing its strategy on the core merchandise, customer service, and marketing will

ensure its longevity in this industry.

! 11 !

Appendix A: SWOT Analyses of Lululemon, Lucy Activewear, & Nike (Page 1 of 2)

LULULEMON

STRENGTHS • Premium active brand focused on

women • Local community engagement and

relationships • Unique in-store experience • Vertical retail strategy allows for

greater control and flexibility • Innovative, technologically-

advanced fabrics and product features

WEAKNESSES • Weaker global brand recognition • Narrower product assortment • Reliance on third-party suppliers • No patents or exclusive intellectual

property rights • Negative publicity in the past year • Multiple changes in senior

management in the past year

OPPORTUNITIES • New store openings domestically • International expansion • Expand youth brand (Ivivva

Athletica) • Grow men’s business • Develop direct-to-consumer

channels further • Diversify product assortment

THREATS • Highly competitive and fragmented

market with increasing number of new entrants

• Changing consumer preferences (i.e., prefer online shopping to going to physical stores)

• Political and economic instability in suppliers’ countries

• Rapid changes in technology

LUCY ACTIVEWEAR STRENGTHS

• Premium active brand focused on women

• Product assortment caters to many different activities and sports

• Support from VF Corporation, its parent company

• Endorsement deals with celebrity fitness trainers

WEAKNESSES • Weaker brand recognition • Lack of international presence • Narrower product assortment only

for women • Less creative control as a subsidiary

of VF Corporation

OPPORTUNITIES • New store openings domestically • International expansion • Diversify product assortment • Develop direct-to-consumer

channels

THREATS • Highly competitive and fragmented

market with increasing number of new entrants

• Changing consumer preferences (i.e., prefer online shopping to going to physical stores)

• Rapid changes in technology

! 12 !

Appendix A: SWOT Analyses of Lululemon, Lucy Activewear, & Nike (Page 2 of 2)

NIKE STRENGTHS

• Largest global seller of athletic goods

• Strong global brand recognition • Prominent sports and celebrity

endorsements • Innovative materials, products, and

marketing • Diversified product assortment • Trademarks are valuable assets

WEAKNESSES • Reliance on third-party suppliers • Profits largely dependent on

footwear sales • Reliance on sales through third-

party retailers causes smaller margins

• Negative publicity surrounding poor work conditions, especially at overseas manufacturers

OPPORTUNITIES • International expansion • Introduce more accessory products • Capitalize on athletic apparel trend

and offer more “fashionable” products

• Developing sustainable, “eco-friendly” products and materials

• Grow Converse and Hurley businesses

THREATS • Highly competitive and fragmented

market with increasing number of new entrants

• Changing consumer preferences (i.e., prefer online shopping to going to physical stores)

• Rapid changes in technology • Majority of manufacturing and

sales are international • Negative publicity from endorsers

could negatively affect Nike’s image

!!

! 13 !

Appendix B: Six-month Marketing Plan (August 2015-January 2016) ! SeaWheeze Fashion Bloggers Like2Buy Time Aug. 2015 Aug. 2015-Jan. 2016 Aug. 2015-Jan. 2016 Cost $900,000 $50,000 $30,000 Initiative Expand SeaWheeze half-

marathon event to Washington, D.C.

Partner with (2) fashion bloggers to create sponsored content

Apply Like2Buy feature to make Instagram (IG)

“shoppable” Details o “yoga.run.party”

weekend event with yoga glasses, half-marathon race, and Sunset Festival

o Washington, D.C. is ideal because of its central location and status as a top physically active city

o 5,000 runners

o Cupcakes & Cashmere by Emily Schuman

o The Chriselle Factor by Chriselle Lim

o Series of blog and Instagram posts sponsored by Lululemon

o Service developed by Curalate

o Creates unique link for retailer to add to Instagram profile

o Link directs users to grid of IG pictures that have items up for sale on retailer’s website

o Clicking on IG picture leads to product page on retailer’s website

o Serves as a wishlist/shopping cart for users by aggregating “liked” pictures into a feed

Rationale o Success and popularity of original SeaWheeze in Vancouver predicts success in a US city o Aligns with

current grassroots marketing strategies o Event will

generate media press, social media buzz and content, and word-of-mouth marketing

o Both are reputable bloggers with millions of loyal readers who value their opinions o Lululemon now

has more “streetwear” items that will appeal more to fashion bloggers and their readers

o Users interact with brands on IG 58x more than Facbook & 120x more than Twitter o Monetizes IG o Allows users to

quickly purchase an item featured on IG o Reduces time

necessary to reply to user questions on IG

Cost calculations

($160, estimated cost per runner * 5,000, # of

runners) + $100,000, expenses for Sunset Festival = $900,000

(Berkowitz, 2013)

$25,000, contract fee * 2, # of bloggers = $50,000

(Sherman, 2014)

$5,000, cost per month of Like2Buy service * 6, #

of months = $30,000

(O’Connor, 2014)

! 14 !

Appendix C: Fall 2015 Merchandise Assortment Plan!!

!!!Sample merchandise assortment plan

SKU$#/NAME/DESC. COLOR/PRINT SIZES PRICE STYLE$TOTAL AUG SEPT OCT NOV10SA286 2 4 6 8 10 12

BlackNightfall

Description: Shine;Dot;Black

Wunder;Under;Pant;FullBOn;Luon

Wunder;Under;Pant;FullBOn;Luon.;

Signature;fourBway;stretch;Luon;fabric;with;secondBskin;fit.;Wide;waistband.

Women’s: 45%

Men’s: 25%

Children’s: 30%

! 15 !

Appendix D: August 2015 to January 2016 Open-to-buy Plan!!!!!

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! 16 !

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