Transcript Decathlon China

Redhawks Consulting
Decathlon China
Using social media to...
◦ increase sales in the short term
◦ increase market share in the long term
Outsource online presence
I. Analysis
I.
II.
External Analysis
Internal Analysis
II. Alternatives
III. Recommendation
IV. Implementation
•
Established manufacturer and retailer of
sporting goods
•
•
33 retail stores in large cities accross China
Unsuccussful in online sales
• Taobao and Inshion
•
Undecided on how to expand through
social media
•
•
•
•
Renren/Kaixin001: 250 million users
Sina Weibo: 100 million users
Tudou: 170 million users
Bulletin Board Systems: 3 billion users
Analysis
Population
20-40 year olds
50% of 420 million internet users are in target group
Economic
Retail industry is growing at 10% annually
Rapid growth of online shopping
Social
Social media dominated by local players
Celebrity endorsement is popular
People consult others before making decisions
Technology
Social media
Mobile phones
Legal
Foreign social networking sites are permanently blocked in China
Tight government control/regulations
External Analysis
Strengths
Strengths
•
Weaknesses
Weaknesses
Weaknesses
Inexperienced in e-commerce and
social media in e-commerce and
Inexperienced
Inexperienced
Weak online
social
mediapresencein eWeak
virtual presence
online
storefront
commerce
and social media
Weak
storefront
Weakvirtual
online
presence
•• Worldwide
brand
awareness •
Worldwide brand
awareness
Qualityyetyet
affordable
products ••
•• Quality
affordable
products
•• Strong
in the
Market
•
Stronggrowth
growth
in Chinese
the Chinese
• Ranked number two in global sales for
••
Market
sports retailers
• Weak virtual storefront
• Ranked number two in global
sales for sports retailers
Opportunities
•
••
Opportunities
Opportunities
Large target market
Growing
popularity
of online/mobile
Large target
market
Large
shopping
Growing target
popularitymarket
of online/mobile
••
• Growing
shopping popularity of
online/mobile shopping
Threats
Threats
Threats
•• Transition
of traditional in• Transition
Transition of
of traditional
traditional in-store
in-store
store
shopping
to
internet
shopping
shopping to
to internet
internet shopping
shopping
•• Competive
Industry
with
shopping
Competive Industry with entrenched
entrenched
competitiors
• competitiors
Competive Industry with
•• Low
margins
retail
Low
margins in
incompetitiors
retail industry
industry
entrenched
• Low margins in retail industry
External/ Internal Analysis
Product
• Sporting
goods
• Table tennis
balls
• Treadmills
• Sports aparel
Price
• Moderately
priced
• “A good
bargain”
Placement
• Retail stores
• 33 in
China
• 400 in 15
countries
• Online
•Taobao
•Decathlon
store
Promotion
• Outdoor
billboards
• Local
newspapers
• Flyers
• Memberships
• Sporting events
• Contests
Internal Analysis
General administration
Margin
Human resource management
Procurement
Inbound
logistics
Operations
Outbound
logistics
Service
Strength
• brick-and-mortar
Weakness
• virtual presence
Internal Analysis
Alternative #1
Alternative #2
Expand brick-and-mortar
presence
Handle social media
marketing internally
Alternative #3
Outsource online presence
Alternatives
Expand brick-and-mortar presence
Advantages
Disadvantages
Experience in brick-and-mortar expansion
Does not exploit social media
Success of current stores
Less cost effective
Alternatives
Handle social media
marketing internally
Advantages
Disadvantages
Cost
Inexperienced in social media marketing
Control over product
Potentially less effective
Alternatives
Outsource online presence
Advantages
Disadvantages
Marketing professionally handled
Higher initial cost outlay
Expertise in online legalities
Less control over product
Quicker implementation
Growth potential (10%+)
Alternatives
● Cost Effectiveness
● Growth Potential
● Increase in Brand Awareness
● Implementation Timeline
● Competitive Position
Alternatives
Weighted Competitive Strength Analysis
.
.
Key Success Factor
Rating
Expand Brick and
Morter
Handle Social
Media Internally
Outsource Online
Marketing
Presence
Rank
Total
Rank
Total
Rank
Total
Cost Effectiveness
.15
2
,3
4
,6
3
,45
Growth Potential
.30
3
,90
4
1,20
5*
1,50
Increase Brand Awareness
.20
3
,60
3
,60
5*
1,00
Implementation Time
.25
1
,25
2
,50
5*
1,25
Competitive Position
.10
3
,30
4
,40
4
,40
Total
1.0
2,35
3,30
4,60
Ranking Scale
1. The alternative does not effectively address this criterion.
2. The alternative may contribute to addressing this criterion.
3. The alternative provides an average solution to this criterion.
4. The alternative provides an above average solution for this criterion.
5. The alternative effectively addresses this criterion.
Alternatives
Alternative #3
Outsource online presence
Recommendation
Implementation Plan
Short-Term
1. Search for and select outsourcing firm
2. Integrate online promotions at current
sponsorship events
3. QR integration
4. Membership benefits
Long-Term
1. Evaluate celebrity endorsement
2. Increase marketing efforts to other segments
Implementation
Request for Qualifications (RFQ) Criteria
1. Plan for completion of e-commerce website
1. Evaluate Taobao and Inshion sites
2. Search engine optimization in Baidu
3. Launch timeline
4. Analytical tools to measure success
1. Click-through rate
2. Purchases per click-through
3. Link-in tracking
5. Previous experience
Implementation
4 weeks
6 weeks
3 months
6 months
9 months
RFQ Deadline
Select firm
Full online launch
Develop member
benefits
Promotion with
sporting events
QR integration
Offer membership
benefits
Milestone Review
Implementation
9 months
18 months
24 months
Evaluate celebrity
endorsement
Implement recommendations
from previous milestone
review
Begin marketing to additional
segments
Milestone Review
Implementation
Risk
Mitigation/Solution
Online sales do not grow as planned
Evaluate building more stores
Communications firm does not
perform well
Research other firms and/or develop
internal marketing department
Develop in-depth contract
Decrease in popularity of social media
sites
Evaluate alternative marketing solutions
Implementation
Redhawks Consulting
Decathlon China