留学生essay代写-Business Analysis on Moncler-based Brand Integration Shop entering Chinese Market

Products

The name Moncler comes from the abbreviation of Monestier de Clermont. Grenoble is currently headquartered in Milan, Italy. Is a professional outdoor sports equipment started clothing brand, its products are mainly down clothes. My business is the Moncler-based Brand Integration Shop. Our company take the Moncler-based Brand Integration Shop as a platform to sell some goods from Italian niche clothing brands and self-designed brands. This is a new business model, we take  dealer + buyer system as our business model. Besides, the matching sale mode of high-priced Moncler down jacket and other low-priced Italian brands, as well as self-designed products broaden the sales channels, increased product diversity.

Industry Integration Analysis

Textile and garment industry is a national industry that has lasted for thousands of years in China, and at the critical moment when the international financial crisis has not yet bottomed out, it is particularly critical to push the revolution of China's textile and garment industry. The state's expectation for the textile industry is not only to improve the profitability of textile enterprises in the short term, but also to promote long-term constant development, emphasizing technological upgrading, structural adjustment and industry integration, focusing on supporting and guiding the backbone enterprises in the textile industry, focusing on R & D, brand promotion and scientific and technological content. 

 

According to the statistics of China Down Clothing Industry Production and Marketing Demand and Investment Forecast Analysis Report issued by Prospective Industry Research Institute, the national down clothing production showed an increasing trend in the first three quarters of 2018, and the growth rate gradually increased. In the third quarter of 2018, the output of down clothing increased by 40.67% compared with the second quarter. In the fourth quarter of 2018, the national production of down clothing fell slightly, and in December 2018, the national production of down clothing was 20.6257 million pieces, down 14.87% from the same period last year. Cumulatively, the national production of down clothing from January to December 2018 was 195 million 898 thousand, down 5.4% from the same period last year.

 

China has more than 1.4 billion people, forming a huge clothing consumer market, and the market is expected to expand year by year. From the point of view of down clothing market, China's down clothing market as a whole is improving, showing a recovery and upward trend. According to the statistics of China Garment Association, the market size of down clothing in China has reached 96.35 billion yuan by 2017, an increase of 12.4% over the same period last year. In recent years, China's garment consumer market has gradually expanded, foreign down clothing brand enterprises have entered China, preliminary estimates of China's down clothing market will exceed 100 billion yuan in 2018, the growth rate will remain at more than 10%. It is predicted that the market size of down clothing in China will be close to 120 billion yuan in 2019, an increase of 10.7% over the same period last year. It also predicts that the market size of down clothing in China will exceed 160 billion yuan by 2022. 

 

In terms of penetration rate, in European and American countries, the penetration rate of down clothing is between 30% and 70%, while in China, the penetration rate of down clothing is only about 10%, and there is still a lot of room for development in the future. In 2017, China's down clothing market concentration is high, Bosten, duck, snow in the fly became the three best-selling brands. 

 

From 2017 to 2018, the import quantity of down clothing in China showed a downward trend, but the import amount showed an upward trend, because foreign brands mainly focused on high-end routes, occupying the high-end market in China with fashion design, and taking people with high salaries as consumer groups. The decline in the number of imports and the rise in the amount of imports mean that the unit price of imported down clothes rises, relying on high quality and international trends to attract high-end consumers. In 2018, the number of down clothing imports in China was 5 million 398 thousand and 200, down 39.37% from the same period in 2017. Imports amounted to 373 million US dollars, an increase of 22.8% over the previous year.

 

In the first half of 2019, the import volume of down clothing in China decreased significantly compared with the same period in 2018, and the import amount increased significantly compared with the same period in 2018. Among them, the number of down clothing imports was 821400, down 23.49% from the same period in 2018. The import amount was 89.2973 million US dollars, up 63.5% from the same period in 2018, while the import unit price continued the trend of nearly two years, and the number of high-end commodities increased, pushing up the import unit price.

 

 

 

In 2020, the down clothing industry will still face the environment of declining consumption growth, and the multi-dimensional competitive pressure from international brands, network platforms and new consumption channels will remain.

 

 

According to the statistics of the General Administration of Customs in 2018, the import amount of various items in China's down clothing industry shows that the pursuit of imported goods by consumer groups is mainly fashion-driven, while the clothing fabrics are mainly made of chemical fibers. In 2018, the proportion of men's clothing accounted for 53.97% and women's clothing accounted for 46.03% of the total import amount of down clothing imported in China, and the market share of men's down clothing imported was 7.94 percentage points higher than that of women's down clothing, reflecting that the demand of men for high-end down clothing products is higher than that of women. Among the eight categories, the highest market share is chemical fiber men's down jacket, accounting for 35.83% of the total import amount. Followed by chemical fiber system of women's down jacket, accounting for 23.08% of the total import value.

Analysis of Five Competitive Forces in Down Clothing Industry

1. The threat of new entrants to the industry

1.1 Scale economy

The competition between Chinese garment enterprises is mainly the competition of scale. There are more than 4000 down clothing brands in China, and some international brands of down clothing enterprises have already entered the Chinese market. After more than 30 years of fierce competition and development, a large number of powerful and standardized enterprises have been formed in the Chinese market. 

 

1.2 Product advantage difference

Product advantage difference refers to the product trademark reputation and user loyalty of the original enterprise. At present, several leading down clothing brands in the Chinese market basically have their own clear market positioning. The prices of Boston down jackets may be relatively low , while ERAL group's down jacket style is more fashionable. These enterprises have created their own unique corporate culture and product style, and won a good corporate reputation. 

 

1.3 Different Distribution Channels

There are various modes of branch schools in the garment industry. Let’s take Boston as an example. The network distribution system of Boston products mainly covers more than 3000 distribution agencies in the country. The company has three production bases, five major brand design departments, more than a dozen branches and more than 3000 brand stores in the country. 

 

1.4 Conversation costs

For the current down clothing enterprises, enterprises need to increase capital investment, absorbing professional managers for management. Only through this way, enterprises can be more professional. Enterprise fashion designers, managers and sales staff have to receive strict staff training, so as to effectively complete the task. These conversion costs are the permanent investment of time, energy, wisdom and money, and will directly face the fierce market competition and high-risk challenges. 

 

2. The threat of substitutes

Substitutes for down jackets can be divided into two categories: cotton-padded clothes and furs.

2.1 Cotton-padded cloths

Cotton clothing refers to clothing filled with cotton, down and other materials. The various forms, low prices and high cost performance of cotton-padded clothes make themselves stand out among similar products. Especially for young people, they have a great willingness to replace down jackets with them. However, the warm keeping function of cotton-padded clothes is far less than that of down clothes, which is not cold enough for northern residents.

 

2.2 Fur coats

Fur coats are clothing made from the fur of animals. It has many categories, including rabbit skin, mink skin, fox skin and so on. Fur's warm function is very good, but because of the complexity of the production process, its price is generally more expensive. The maintenance process of fur coats is also quite complex.

 

3. Supplier's bargaining power

The raw material of down clothing, duck down, accounts for more than half of the total, and can be mixed with some small feathers. Down clothing accessories are zippers, fasteners, elastic ropes and so on. The relationship between the industry and suppliers is mostly partners. Most enterprises choose to establish cooperative partnership with suppliers, so as to control the risk of changes in bilateral relations and develop a dynamic supplier evaluation system. Double constraints are also prevalent in this industry. On the one hand, apart from providing down clothing enterprises, there are few other sales channels for the suppliers to sell their goods. Down clothes industry is the main source of its profits. On the other hand, the quality of products in the down clothing industry depends on the quality of down, and good quality down has a good warming function. However, the price of duck down has risen sharply from 180000 yuan per ton ten years ago to more than 420000 yuan per ton, which has greatly increased the production cost of down clothing. It is very important to choose a down supplier with low price and good quality.

 

4. Bargaining ability of buyers

Affected by the overall global economy, China's macroeconomic situation and relevant national policies, China's down apparel industry has experienced different degrees of development and decline. After ten years of development, China's first and second-tier urban residents have basically achieved 4-5 pieces of down clothing per capita, and rural areas have also reached one piece per capita. Therefore, there is little room for the growth of down clothing sales. According to the statistics of key large retail enterprises in China, the growth rate of down commodity retail volume and the proportion of retail volume in clothing have declined in recent years. According to the official data released by the down clothing industry in 2018, the price of most down clothing is less than 1000 yuan, ranging between 300 and 600 yuan. Consumers' sensitivity to price is weak.

 

5. Peer Competitions

These ten years witness the rapid development of the down jacket industry, how to stand out from the many enterprises has become the most important issue facing the down jacket business. At present, the most prominent problem in the domestic down clothing industry is the backwardness of clothing style design. For small and medium-sized enterprises, they pay more attention to the construction of the terminal market. They have realized that compared with the past star endorsement and advertising investment, attaching importance to market terminals can better enhance branding. These enterprises invest limited funds in product quality, design and development, and sales terminal construction. Many enterprises focus on the construction of market terminal and the work of monopoly stores. They have standardized the detail management and organizational process, so as to ensure the orderly, lasting, healthy and high-speed development of the enterprise. For large enterprises with independent original brands, they began to enter the high-end market. With some well-known international brands entering the Chinese down apparel market, their brand influence has led consumers to buy their down apparel products. The emergence of high-priced down jackets has become a phenomenon to the industry. Some large down clothing enterprises in China are gradually pushing forward to the high-end market. Some excellent enterprises continue to increase their invests on  scientific research, so as to increase product added value and raise product price, thus avoiding low-price competition and irrational competition.

 

Strategic Deployment

 

Marketing theme: a different fashion in winter

 

In the initial stage, due to the limitation of funds and personnel, the first Moncler Fashion Integration Store will be opened in Shanghai. Our main business is the sale of Moncler brand down jacket and independent design of a simple jeans,skirts and top wears. This Moncler Fashion Integration Store adopt the mode of product matching sales, through the sale of Moncler down jacket and our unique clothes, designing a simple interior independently can get more advertising opportunities. After our products and services are gradually accepted by the society, our company will set up brand stores in Hangzhou, Suzhou, Nanjing and other places to expand the coverage of products. This Moncler Fashion Integration Store uses the emerging product integration, product direct marketing mode of operation, controlling the cost of the intermediate channel in the lowest degree.

 

Market Entry Mode

The process of products entering the market can be divided into three stages: introduction, growth and maturity.When products enter the market, they will inevitably encounter the resistance of the original consumption structure, consumption pattern in the market. The performance and advantages of products are not fully understood, trusted and accepted by customers, so there are fewer buyers. In the early stage of in entering, we adopt the marketing strategy of rapid plunder, and promote products to the market by means of high prices and promotion. If the price of the product is high, the company can get more profits from it. And large-scale promotional activities are a means to attract customers to buy goods. When the enterprise enters the growth stage, the enterprise has accumulated a certain number of customers through the brand collection store, and has mastered some operational experience. At this time, the focus of enterprises is to strive to improve the quality of products, increasing the types, styles and colors of products, and promoting their own independent design of clothing brands. On the basis of establishing some customer information, the company will analyze different consumer preferences from these customer information, further segmenting the market, changing the advertising policy, and forming new idea to attract customers. When the products of the brand integration shop are accepted and purchased by most customers, our company has entered a mature period. At this stage, the sales of brand integrated stores will reach the peak, the market tend to be saturated, and the sales growth slow down and tend to be stable. Similar products and imitations of various brands will enter the market, and the market competition is very fierce. Therefore, our company will change the types and styles of goods sold, and at the same time, we will make corresponding changes in product marketing.

 

Pricing Strategy

The pricing method adopted by our company is a combination of competition-oriented pricing method and prestige pricing method, so that the price of our products is close to the level of peers. At the same time, based on the difference of customers, sales time, sales place, product form, differential pricing will be set on different products.

 

Advertising Strategy

Leaflet Distribution: At the beginning of the establishment of the brand collection store, we will launch a quarterly brochure. Each brochure is printed with our main products and promotions for this season to attract potential customers to our brand.

 

Brand Sponsorship: As the the younger generation of students and white-collar workers are our target groups, we can choose to cooperate with some universities in Shanghai to sponsor a winter event with high participation, and require that our brand and address should be printed on the banner.

 

 

Conclusions

According to the analysis of China's down garment market, the positioning of China's down garment market has begun to diversify. With the price impact of international brands and the upgrading of domestic brands, the high-end down clothing market has gradually explored. Moncler has always been known for its fashion and warmth. Although the price of its down jacket is more than 4000 yuan, its unique design and good quality have attracted countless Chinese middle and high-level consumers. Due to the continuous rise of domestic down jacket prices, the price gap between Moncler down jacket and domestic similar down jackets is narrowing. After gradually losing the price advantage, it is difficult for the domestic similar down jacket to compare with Moncler in style and quality. Those evidence shows that the introduction of Moncler down jacket has great market potential.

 

Reference

Kitchen, P., ProQuest, & ProQuest CSA. (2010). Integrated brand marketing and measuring returns. Basingstoke, Hampshire ; New York: Palgrave Macmillan.

 

Zhang, Yu Jing, Wang, Chao Long, Xu, Hang, Zhang, Mei, & Han, Hong Shuang. (2014). Analysis on down Coat Fabric. Advanced Materials Research, 941(12), 1327-1330.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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