WEEK FIVE ASSIGNMENT:
4 Ps MODEL & PORTER’S COMPETITIVE ADVANTAGE
I’m interested in marketing some high-quality, fashionable Yoga pants I discovered while visiting Brazil last year. I bought the pants on the street in Rio for $14, and one of my Brazilian friends told me he “thought” he could help me find the factory where I could “probably” purchase them for about $5 a pair. I was thinking I could bring $1,000 worth back and sell them online to kick off my internet marketing career.
But upon returning to the U.S., I discovered that someone beat me to it! I found the same pants at a gift shop at a Yoga center in Massachusetts. The hangtag, in English, listed the importer’s name as Alicia Nogueira, and the price on these babies was $80! They are very nice, though, and the price isn’t totally unreasonable.
I immediately Googled Alicia and sure enough, she had a web site where she had a range of pants selling from $79 to $86. Most of her pants had a floral design on them, but the ones I bought do not. I realized after reading the article below, that she does original artwork (floral paintings) and has the pants made to order in Brazil. But the ones I’m interested in are different. They don’t have Alicia’s artwork, just a printed design. So maybe I can still market the pants.
Alicia markets several other clothing items on her site, as well as jewelry and home decorating objects. Hers is more of a New Age Yoga site than a Brazilian import site, because only the workout wear seems to be made in Brazil.
You can visit the site at www. Balidog.com
For additional background, here are some excerpts from an article I found through Google about Nogueira. It was reprinted from her local Telluride, Colorado newspaper:
As Nogueira tells it, Bali Dog was born following an inspirational journey to Indonesia, in which the mystical pull of Bali kept her on the island longer than her originally intended three-week stay. While there, Nogueira fell in love with the unique and brilliant locally made clothing, and began creating her own batik patterns. She returned home with 400 pieces of hand-crafted, wearable art, and to her surprise, she managed to sell them all. Nogueira returned to Bali the following year and this time brought back 4,000 pieces, which again were quickly bought up by her friends and yoga students.
Today, nearly 12 years since the birth of Bali Dog, the company has taken on a life of its own. Nationally recognized as one of the hottest yoga clothing companies, Bali Dog’s inimitable yoga pants, tops and shorts are worn in yoga studios from New York to San Francisco. Nogueira receives orders from all over the country, oftentimes from yoga studios that, after their first order, typically reorder within 30 days. Bali Dog also does business in England and Australia, and hopes to expand further into the international market.
Of the humble beginnings of her now booming business, Nogueira says, “I got a lot of compliments – people adored the stuff. I was surprised [about Bali Dog’s success] because I never wanted to be a merchant.
Bali Dog clothes are now manufactured in Brazil, where each garment is individually hand painted as a unique work of art following design patterns created by Noguiera.
PRODUCT
Hard products, some designed by Nogueira and some not. Much of the clothing seems to be made at a factory in Brazil and shipped to her warehouse in Telluride, Colorado.
PRICE
The prices on the site are high. I would expect to pay this at a boutique in Soho, NYC. She’s selling quality, fashion, and a sort of “spiritual pampering” benefit. The Yoga pants are her most featured item. Her home page calls them “wearable art.” I’m pretty skeptical and picky about such things, but I agree. They ARE beautiful and worth the price! I think she should keep her price high.
Shipping cost was a hefty $10.95 for a pair of $59 pants. Perhaps she could offer free shipping during the holidays, or a break in shipping costs for orders over $200.
The site accepts Visa, MasterCard, AmEx and Discover. Perhaps she should add PayPal.
PLACE
Because I saw the pants in a boutique in Massachusetts, I’m guessing that Nogueira is distributing to ashrams and yoga farms all over the U.S. (This was confirmed by the article I found.)
When I Googled her name, I found that her pants are sold at numerous other Yoga web sites: anahata.com, yogafinder and omtime to name a few. I didn’t see Bali Dog at any of the big sites such as Amazon and Yahoo.
If Nogueira wanted to grow her business, she could certainly market them to other types of workout stores that weren’t specifically for Yoga. Maybe she could do some search marketing. I’d run a search on wordtracker. A few of the keywords I’d start with are: yoga pants, workout pants, lycra pants, women’s workout clothes/clothing, Brazilian athletic wear, women’s athletic wear, Pilates workout pants. I bet she could make money selling some of her designs to Nike.
PROMOTION
I couldn’t find much evidence of any promoting she’s doing on the Web. She was listed on Yoga Journal’s web site as a featured advertiser. Here are some ways I thought Nogueira could promote her business:
- Say that a percentage of the profits go to underpaid factory workers in Brazil. Then she could do PR and advertise on a lot of non-profit or charity web sites. Advertise this fact in newsletters for non-profits.
- Open an eBay store
- Send a PR release to Yoga Journal
- Do affiliate marketing with Amazon and Yahoo and the myriad new age and Yoga web sites. I bet there are a lot of stressed out women who doYoga who would like to pamper themselves with a pair of these pants.
- Expand advertising to Pilates studios and gyms, as well as their web sites. Not just Yoga places.
- Do a blog on Yoga and fitness that features the pants. Or advertise on a popular fitness or Yoga blog.
- Do a Wordtracker study and see where people look when they’re buying yoga pants or workout wear. She could advertise on those sites.
- Write a newsletter about the art of Bali or Yoga, or ways women can lower stress and pamper themselves.
- Promote the pants as a gift. Time promotions with end of year holidays, mother’s day, valentine’s day, graduation
- Get a link on an Amazon page that sells Yoga books
- Capture customer data and send out an e-mail marketing campaign with notices of sales and new designs as they become available. Yoga pants wear out after about a year and could be a repeat purchase.
PORTER’S COMPETITIVE ADVANTAGE
I think Nogueira should keep her prices high. She positions her pants as art to a very specific audience – young women who do Yoga. And women seem willing to pay it. So in Joe’s analogy of C-Town, Whole Foods and the Butcher, Bali Dog is Whole Foods, because she sells a lot of different high-quality stuff. If I sell the pants, I’m going to be the Butcher, because I’ll limit my inventory to pants (oh, and maybe a matching top!)
IMPLICATIONS FOR ME, IF I WANT TO START A YOGA PANTS BUSINESS
To compete with Nogueira, I would buy the one SKU that she did not design from the factory in Brazil and sell it for a lower price, for perhaps 30% less. I’d look for a range of about six patterns or designs that I would sell in 3 sizes, Small, Medium and Large. I would consider selling them in an eBay store to get greater exposure, and do an intense keyword marketing campaign. I’d write a blog and offer a newsletter at my site. While Nogueira positions her pants as Bali inspired (you have to look pretty hard on the site to see that they’re made in Brazil) I would emphasize the Brazil origins and promote the pants as being authentic Brazilian. Brazil is HOT and has a lot of cache for people who like to work out. Perhaps I could create content that would get my ads placed on Brazilian tourism sites, athletic, Pilates and Yoga sites, and women’s pampering spa sites.
