Professional Documents
Culture Documents
RESEARCH PROPOSAL - AE 1
Lauren Paull
2/8/2016
2/8/2016
Contents
Introduction .................................................................................................................................................... 2
Selection of international market- New York, USA ........................................................................................ 2
Core Benefit to Select Market .................................................................................................................... 2
National Culture Dimensions ...................................................................................................................... 2
Power Distance Index ............................................................................................................................. 2
Individualism Vs Collectivism.................................................................................................................. 2
Masculinity Vs Femininity ....................................................................................................................... 2
Uncertainty Avoidance Index ................................................................................................................. 3
PESTEL......................................................................................................................................................... 3
Selection of organization- new look group..................................................................................................... 4
Background of New Look ............................................................................................................................ 4
Industry and Product Type ......................................................................................................................... 4
Organizational Culture ................................................................................................................................ 4
Customer Type ........................................................................................................................................... 5
Prospective Competitors ............................................................................................................................ 5
SWOT .......................................................................................................................................................... 5
Selection of a key international marketing approach .................................................................................... 6
Identification of the approach .................................................................................................................... 6
Ansoffs Matrix ....................................................................................................................................... 6
Porters Value Chain ............................................................................................................................... 6
Why is it critical for success? ...................................................................................................................... 7
Conclusion ...................................................................................................................................................... 7
Appendix......................................................................................................................................................... 8
References ...................................................................................................................................................... 9
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INTRODUCTION
This report is a proposal which will justify why New Look should expand its business into the USA, in
particular New York. The report will identify factors which imply that New Look launching in New York
would be successful, and will outline why further research should be conducted in order to complete a full
report.
Individualism Vs Collectivism
Browaeys and Price (2015), describes this dimension as dealing with the relationship between the
individual and a group. It studies the extent to which members of society want to be part of a group. The
USA scores 91 in this dimension which makes them one of the most individualist countries in the world. In
an individualist society people tend to look after themselves and direct family. Combining the USAs low
power distance index score and high individualism score suggests the following:
Americans believe in liberty and justice for all, which is evidenced by the emphasis on equal
rights in all aspects of American society and Government.
Within American organizations, hierarchy is established for convenience.
Both managers and employees expect to be consulted and information shared freely.
Americans are accustomed to doing business with strangers and consequently are not shy about
approaching others for information (geert-hofstede.com).
Masculinity Vs Femininity
Hofstede developed the masculinity Vs femininity dimension so that societies can be characterized as
being both assertive and competitive or more caring (Browaeys and Price, 2015). In this dimension the
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USA has a score of 62, making them a masculine society. This can be seen in their typical behavioral
patterns such as:
In school and work Americans share the same values that people should strive to be the best
they can be and that winners take all. As a result of this Americans tend to display and talk
freely about their successes.
Setting targets in order to log achievements (geert-hofstede.com).
Living to work so that they can obtain momentary awards and consequently attain a higher
status.
There is a fair degree of acceptance of new ideas, innovation and trying new things, whether to
do with technology, business practice or food. Americans tend to be tolerant of others ideas and
opinions and encourage freedom of speech.
At the same time, the 9/11 terrorist attack put a lot of fear into American society (which could be
why the USA scores higher than the UK), where the government monitors everybody through the
NSA and other security organizations (geert-hofstede.com).
PESTEL
PESTEL can be used in order to assess the Macro Environment. Masterson and Pickton (2010), define the
macro environment as the broad, external influences that affect an organization. A PESTEL analysis has
been used to define political, environmental, social, technological and economic factors that will affect
New Look launching its first store in America.
Environmental
Social
Technological
Currently the total sales and Tax rate in New York City is 8.875%. There is no sales tax
on an item of clothing or footwear that costs less than $110 (www1.nyc.gov). Sales and
Tax rates are subsequent to change, so New Look would have to keep abiding by them.
Currently New York has large waste disposal problem, where the government are
trying to find economically viable and sustainable ways to dispose of an estimated
50,000 tons of residential and commercial waste everyday (www.theguardian.com).
New Look would have to consider that the NYC government (2016), state that
commercial businesses have to arrange private waste collectors and pay a fee for this
(www1.nyc.gov). A way that New Look can be economically efficient would be to use
paper bags instead of plastic bags, as well as recycle all waste efficiently.
Recently, The New York City population reached a record-breaking 8.3 million
residents, therefore increasing the demand for retailers (www.nycedc.com). New Look
is a fashionable yet affordable business, so there would be room for the business to
expand to New York.
With advanced technology emerging every day, retailers are having to become more
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Economic
Legal
innovative. For, example in New York, the store Levis will have touchscreen devises in
the fitting rooms where customers can ask for different sizes or styles by pressing a
button and alerting a sales assistant. CBS New York, predict that by the end of 2016 this
technology will be in most stores (newyork.cbslocal.com). New Look would have to
consider installing new technologies whilst building the store in order to keep
innovating and improving the customer experience.
Since the Great Recession, The New York City retail market has had a strong recovery
(www.nycedc.com). Industry Trends and Insights (2013), suggest (according to figures)
that with the current retail sales, employment, number of rising establishments, and
millions of un-used square feet of retail estate, there is a strong foundation for lasting
growth in the retail sector. New Look could use this to their advantage to increase sales
and revenue.
The legal laws for retail establishments in New York are similar of that in the UK. For
example one legislation is that a business must provide truth in advertising and cannot
mislead customers (www.hg.org). New Look already does this in the UK, therefore they
would just have to carry on doing so in New York.
Organizational Culture
Masterson and Pickton (2010), loosely describes organizational culture as the way a company does
things. The culture of a company is often set by the chief executive(s) or founder(s). Their lead tends to
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influence the behavior of other members of the organization. New Look describes themselves as being
customer orientated, stating that customers are at the heart of everything we do. New Looks vision is to
become the chosen brand for an inspiring accessible fashion experience (www.newlookgroup.com).
Customer Type
New Looks general target market are females aged 16-45. However, recently one of the key priorities of
the brand is to increase menswear sales (academic.mintel.com).
Prospective Competitors
New look will have a number of key prospective competitors when they launch into New York. New Look
will find stores they are already competing with in the UK such as Topshop, Mango and H&M.
H&M
Mango
Topshop launched its first store in the New York in 2009 and since then has been
a great success. Topshops CEO Phillip Green said that a number of British
retailers have attempted to conquer America and failed, therefore he learnt from
their mistakes (news.bbc.co.uk). Topshop was described as being young, fun and
edgy compared to other stores in the US (www.theguardian.com). New Look has
similar clothes to Topshop and is also a British brand so should take tips from
their launch. However, these two stores would be tight competition.
H&M was founded in Sweden in 1947, and in 1976 they opened their first
international store into the UK. Since then, H&M has continued to launch stores
internationally and opened their first US store in 2000 (about.hm.com). As H&M
are already competitors to New Look in the UK, they will most certainly be
prospective competitors in the US.
Mango are a worldwide company with 2,415 stores in 107 countries
(shop.mango.com). They currently have three stores in New York
(www.retale.com). For their Spring 2016 campaign, Mango have used the famous
model/socialite Kendall Jenner who has millions of followers on social media
(www.popsugar.com). Mango will be tough competitor as they have an
impressionable celebrity in their campaign who will entice customers.
SWOT
The SWOT analysis is a general management tool used for basic market planning, in order to assess the
micro environment (Masterson and Pickton, 2010). Figure 4 addresses New Looks strengths, weaknesses,
opportunities and Threats, which have been adopted from the PESTEL and organization information. This
will help justify a launch into New York.
Weaknesses
Threats
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Opportunities
New Look currently ship products from 860 factories in 28 different countries
(www.newlookgroup.com), so to start with New Look should ship their goods to
America. However, if the launch in America is successful, New Look should
consider making a Foreign Direct Investment. If there was a depot in America,
New Look could efficiently transport goods to the store.
As discussed in prospective competitors, New Look should acknowledge the
impact of celebrity endorsements. If New Look were able to do this, they would
gain worldwide exposure. A successful marketing campaign would be crucial to
attract consumers in the New York retail market.
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CONCLUSION
New Look is a young, fashionable and affordable brand and through social media are able to post stylized
images, therefore successfully promoting desirable fashion trends that customers want to buy
(internetretailing.net). New Look has already become an international success by launching stores in
places such as Europe, China and the Middle East. With British competitor Topshop already having a
successful launch in America, it seems this should be the next step for New Look. A recommendation for
New Look would be to hire a celebrity endorsement for their launch, as it is working well for stores such
as Topshop and Mango.
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APPENDIX
Figure 1- United States and UK Cultural Dimensions Comparison
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REFERENCES
BBC NEWS. 2009. Topshop takes American Plunge [Viewed 15th February 2016] Available from:
http://news.bbc.co.uk/1/hi/business/7978055.stm
BROWAEYS, M, J., R PRICE, 2015. Understanding Cross-Cultural Management. 3rd ed. London: Pearson
Education Ltd
BUSINESS FREE, 2015. Porters value chain [Viewed 12th February 2016] [Image].Available from:
http://www.businesssetfree.com/porters-value-chain/
CBS NEW YORK, 2016. Retailers using robots to improve in-store shopping experience [Viewed 15th
February 2016] Available from: http://newyork.cbslocal.com/2016/01/27/retail-shopping-technology/
ELLA ALEXANDER, 2014. New York is The Worlds Top Fashion Capital [Viewed 25th February 25, 2016]
Available from: http://www.vogue.co.uk/news/2014/02/05-/new-york-is-crowned-fashion-global-capital
H&M, 2016. History [Viewed 21st February, 2016] Available from: http://about.hm.com/en/About/factsabout-hm/people-and-history/history.html#cm-menu
HG LEGAL RESOURCES, 2016. Retail Law [Viewed 15th February 2016] Available from:
http://www.hg.org/retail-law.html
INTERNET RETAILING, 2014. Retail Review: New Look [Viewed 25th February 2016] Available from:
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ITIM INTERNATIONAL, 2016. The Hofstede Centre [Viewed 15th February 2016] Available from:
http://geert-hofstede.com/united-states.html
MANGO, 2016. The Company [Viewed 21st February 2016] Available from:
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MASTERSON, R., D PICKTON, 2010. Marketing an introduction. 2nd ed. London: SAGE Publications Ltd
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http://academic.mintel.com/display/716211/#
NEW LOOK GROUP, 2015. Ethical Trading [Viewed 25th February 2016] Available from:
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NEW LOOK GROUP, 2016. Our Customers [Viewed 15th February 2016] Available from:
http://www.newlookgroup.com/who-we-are/our-customers
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http://www1.nyc.gov/nyc-resources/service/1425/commercial-waste-disposal
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stry_Trends_Retail_OPT.pdf
RETALE, 2016. Mango in New York [Viewed 21st February 2016] Available from:
http://www.retale.com/stores/New-York-NY/Mango/v-r334
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http://economictimes.indiatimes.com/definition/value-chain
THE GUARDIAN, 2009. Topshop New Yorks cutting-edge fashion is a Broadway smash [Viewed 15th
February 2016] Available from: http://www.theguardian.com/lifeandstyle/2009/apr/02/topshop-newyork-launch-kate-moss
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