The new pantyhose. With you for the long run. l e o a Alanna Lopes Souza | Amy Kwan | August du Pont Lean LaunchPad Team #5 The first branded, non-run pantyhose brand on the market aiming to make things simpler for women. MBA 2015 MBA 2015 MBA 2015 Day 5 Customer Interviews: 40 Total Running: 103 Surveys: 66
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The new pantyhose. With you for the long run.
l e o a
Alanna Lopes Souza | Amy Kwan | August du Pont
Lean LaunchPad
Team #5
The first branded, non-run pantyhose brand on the market aiming to make things simpler for women.
MBA 2015 MBA 2015 MBA 2015
Day 5Customer Interviews: 40
Total Running: 103Surveys: 66
• Pantyhose will last much longer and save consumers money in the long-term
• Feet will not slip in heels
• Machine washable
• Easy-to-store packaging
• Easy-to-wash laundry bag
• Physical: Web infrastructure, retail outlets
• Intellectual: Patents and brand copyrights
• Human Resources: Marketing and operations, development partner
• Financial: Seed capital
Business Model CanvasKey Partners
• Pantyhose manufacturers
• Wholesale channels
• Shipping companies
• Internet search engines
• Lawyers (patents)
Key Activities Value Propositions Customer Relationships Customer Segments
• Values quality over price (willing to pay a premium) but currently buys pantyhose at the drugstore for convenience
• Drive traffic to retail channels
Direct-to-Consumer
Wholesale Channels
Direct-to-Consumer
Wholesale Channels
• Home shopping networks
• Drug stores
• Department stores
• Get: Free products at professional conferences, free branded accessories (storage case and washing machine bag), coverage from fashion blogs, Search Engine Optimization
• Keep: Guarantee, product quality
• Grow: Word of mouth, increased color/design variety, subscription rewards
• Direct-to-consumer
• Established retail outlets
• Direct marketing
• Social media
• 1-year guarantee that pantyhose will not run
Channels
Day #1
• Target price $20
• Direct-to-Consumer revenues
• Subscription revenues
• Physical: Web infrastructure, retail outlets
• Intellectual: Patents and brand copyrights
• Human Resources: Marketing and operations, development partner
• Financial: Seed $
• Product development
• Partner with quality manufacturer
• Control of production, manufacturing
• Manage website, online orders, and distribution
• Branding strategy
• Marketing / promotion
• Packaging
• Direct-to-consumer
• Established retail outlets
• Direct marketing
• Social media
• 1-year guarantee that pantyhose will not run
Direct-to-Consumer
• Pantyhose will last much longer and save consumers money in the long-term
• Feet will not slip in heels
• Machine washable
• Easy-to-store packaging
• Easy-to-wash laundry bag
Business Model CanvasKey Partners
• Pantyhose manufacturers
• Wholesale channels
• Shipping companies
• Internet search engines
• Lawyers (patents)
Key Activities Value Propositions Customer Relationships Customer Segments
• Grow: Word of mouth, more color/design variety, add a kids/toddlers line (for dance & normal wear), plus size line
Channels
• Wholesale to retailer revenues
• Price of $11.75
• ~$5 cost = $6.75 per pair
• ~57% gross margin
Day #5
X X
X
Key Learnings
Messaging is key, “nice to have”
features aren’t.
Women need to know HOW and
WHY.
Save the retail channels for later.
Build on an emotional
experience.
1
2
3
4
Customers and CPG experts
• Focus on core value prop: non-run• Non-slip feature removed• Storage box not valued
Customers and CPG experts
• Educate through channels: brand values, easy care
• Trademark slogan and quality standard - LeoKnit™
Distributors and retail outlet experts / entrepreneurs
Customers and CPG experts
• Focus on direct web sales first• .com retailers and mass retailers are
part of growth
• Add personalized messaging and loyalty program
• Target Working women and students (ages 25-40)
How did we find out?What? Implications?
Key Learnings – Customer ArchetypesAllison
Grad Student, 27Sonia
Lawyer, 32
Established or career-minded women Aged 25-40 Shops online, tech savvy Doesn’t really watch TV but uses social media Reads blogs, in step with the times Goes to coffee shops regularly Goes to occasional evening events
s
s
s
s
s
Key Learnings – Buying Behavior
• Frustration leads to cycle of last-minute buying before interviews or parties
l e o a
Current Future
• Purchasing only as needed (unplanned)
• Look for a low price tag because they don’t last
Planned purchase
Value purchase, trust
Strong experience leads to long-term relationship
Creating BRAND EQUITY is key.
• Get: Conferences, trade shows, blogs, SEO, magazines, graduate schools
• Keep: Guarantee, shipping & return (free), loyalty program
• Grow: Word of mouth, color/design variety, kids/toddlers line (dance & regular), plus size line
• Females in the age range of 25-40 (employed professionals and graduate students)
• Values quality over price (willing to pay a small premium)
• Sometimes reads blogs
• Tech savvy
• Price $20
• ~$5 cost = $15 profit
• ~75% gross margin
• Direct-to-Consumer revenues
• Physical: Web
• Intellectual: Trademarks and brand copyrights
• HR: Marketing and operations, development partner
• Financial: Seed $
• Branding strategy (leos)
• Marketing / promotion
• Product development
• Partner with quality manufacturer
• Manage website, online orders, and distribution
• Direct-to-consumer
• Direct sales force
• Direct marketing
• Social media and blogs
• Guaranteed
• Eliminate the main pain points women have with pantyhose
• Pantyhose will last longer and save consumers money in the long-term
Final Business Model CanvasKey Partners
• Pantyhose manufacturers
• Shipping companies
Key Activities Value Propositions Customer Relationships Customer Segments
Key Resources
Cost Structure Revenue Streams
• Fixed: Product & packaging development, infrastructure (website), accounting system
Kids line (dancers) Plus size line Targeted ads for people
who don’t wear pantyhose at all because they hate what’s out there
EconomicsSale Price $20.00Price to Retailer $11.75Manufacturing Cost $5.00
Markup 70%
Profit per Pair $6.75Gross Margin 57%
• Seek out retail partners (Target, Walmart) after initial sales
• Look into channels, product, and people expansion
• Talk to marketing industry experts
• Develop marketing strategy
• Develop website• Partner with manufacturer• Research quality
assurance methods / risks
Next Steps…
Medium Long TermImmediate
Stage 1 Stage 2 Stage 3
• YouTube ad campaign• Test non-slip grips on the
market, patent if successful
Appendix
Market Size
$1.5B
$471M
$334M
• 51.3M employed females ages 18-54
• Averaging $30 spent on pantyhose per year
• IBISWorld “Hosiery Mills in the US, November 2013”
• Discount stores & mass merchandisers
• Department stores• Online
Sources: IBISWorld; “Hosiery Mills in the US, November 2013”U.S. Census Bureau, Current Population Survey, Annual Social and Economic Supplement, 2011.
Total Addressable Market
Served Available Market
Target Market
l e o aFast
Fashion Stores
Premium Stores
Online Brands
Department Store
Brands
Drug Store Brands
Brand Awareness
Affordability
Quality
Storage / Washing
Non-Slip Feature /
Competition
Competition
Retail / Online Stores
Drug Stores
Department Stores
Who They Are What They’re Missing
Affordability• High price points
Reliability• Can’t always find
basic print / colors
Convenience• Stores are not
designed for shoppers on the go
Quality• Products are typically
cheap and likely won’t last longer than their initial use