Business Management Internal Assessment

Research Question:
“Should Kruder clothes menswear look into expansion by introducing womenswear?”

Candidate code:

Word count:
Research Proposal:
Executive summary:
Written report:

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 Research Proposal

“Should Kruder clothes menswear look into expansion by introducing womenswear?”

Background

Kruder is an Italian brand founded in 2005, that only sells Men clothes. ​The key concepts that

drive the Kruder collections are originality, competitiveness, elegance, design, modernity and

versatility. The garments, designed in Italy, are inspired by urban culture, characterized by a

versatile style but at the same time refined and designed to be worn at any time and on any

occasion, both formal and informal. Kruder today is a dynamic and constantly evolving reality,

which has established itself as a well-known brand in the men's clothing scene, with a capillary

presence that counts 40 stores distributed throughout Italy.

Rationale

Due to the previous product launches of this brand, this research will focus if it is a profitable

venture to introduce womenswear into Kruder product portfolio by 2019 to expand its

customer base and increase brand awareness. For this reason, I am going to need to use many

different analytical tools to evaluate whether the decision is going to be successful or not.

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Areas of syllabus to be covered

-(1.3 )Organisational Objectives​: Ansoff Matrix categorising the introduction of a new market

segment

-(1.7) Organisational planning tools: ​SWOT analysis: ​Identifying and analyzing the strengths,

opportunities, weaknesses, and threats of the business

-(4.5) BCG Boston Matrix:​ T​o consider the growth and opportunities by reviewing its portfolio

of products to decide where to invest, to discontinue or develop the products.

-Market Research: ​Interviews and questionnaires. To analyze and evaluate how the customers

are going to view the proposal of the expansion of the product portfolio.

-​Competitor Analysis:​ Understand whether or not a businesses in that area which offer similar

services and therefore be in direct competition with the business, might affect Kruder

Methodology
Primary research:

1. ​Interview to Owner & Member of the Marketing Team

● Information on demand for developing product

● Information on investments (costs,location,development of product,employment skills)

● Current market position and strategies, as well as the current situation of the economy.

2. Survey to Customers

● Full detail understanding of who Kruder's customers are and gain further insight on their

opinions about the brand

Secondary Research:

● Competitor analysis on Google Maps to find the brands offering similar products in the

same area

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 Anticipated difficulties

Difficulties Solutions

Customers might be reluctant to reply to Will be interview in person if

online surveys minimum 15 customers don't answer the
survey

Risk that the owner might not want to give Ensure the owner’s willingness to share data
financial data in advance

Action Plan

Task Date Modification of date

Research Proposal 16/12/2018 On time

Prepare Interviews and questionnaires 19/12/2018 On time

Give out questionnaires 23/12/2018 On time

Interview Owner 26/01/2019 On time

Analyze the Market 29/01/2019 On time

Discussion and Evaluation (BCG, SWOT 02/01/2019 On time

Competitor Analysis)

Conclusion and recommendations 11/01/2019 On time

Draft 05/02/2019 On time

Final Draft 15/02/2019 On time

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Executive summary
The purpose of this report is to investigate whether​ ‘Kruder menswear should look into expansion by

introducing womenswear’​. Primary research involved interviewing the owner of the business and a

member of the marketing team. Questions were asked based upon Kruder's current market position and

strategies, as well as the current situation of the economy.

The first tool used was a competitor analysis: an identification of the competitors in the vicinities. To

support this analysis a survey to customers was also undertaken to find out views on the brand itself and

on preferred brands near the area the shop is located. Questions were additionally asked regarding

opinions on the introduction of a Kruder clothing line for women.

The SWOT analysis was used to further analyse the internal strengths and weaknesses of the business,

and assess it with the external opportunities and threats of the business.

The Ansoff Matrix allowed me to categorise Kruder’s introduction of a new marketing segment as a

market development growth strategy. The Boston Matrix was used as a tool for marketing management

as an approach to product portfolio planning.

Word count: 181

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Acknowledgements:

A special thanks goes to Victor Benjamin, owner of the business and Gioia Ricci from the marketing team

for giving me access to Kruder’s ​information on their current market position and strategies, needed for

the growth prospect. ​Also a thanks goes to Kruder’s clients for sharing their opinions with me, as well as

giving up their time to participate to my survey.

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Contents page:

Executive Summary...............................................................................5

Introduction...........................................................................................7

Methodology........................................................................................10

Main results and findings.....................................................................11

Analysis and discussion.......................................................................16

Conclusion...........................................................................................19

Recommendations..............................................................................20

Bibliography........................................................................................21

Appendix.............................................................................................22

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Section 1: Introduction

“Should Kruder clothes menswear look into expansion by introducing womenswear?”

Kruder is a private limited company funded in 2005 by CEO Victor Benjamin. It is an Italian brand that

only sells men clothes and has many different outlets throughout Italy. The brand has ​its own key

concepts such as original style, competitiveness, research, design, modernity. ​The target audience of the

business product is represented by men between 25 and 65 years, attentive to their image but

transversal from the socio-economic point of view and therefore to the spending capacity. ​This research

project investigates the choice of Kruder of investing in womenswear in order to expand the business

and whether it is a worthwhile decision by considering a number of internal and external factors.

Section 2: Methodology

As ​primary research​ an interview was carried out with Victor Benjamin, the owner of the business, in

order to learn relevant information on the decision and to establish potential quantitative data, such as

the costs of investing in this project​.​ In addition, I also interviewed Gioia Ricci from the marketing team.

Questions were asked based upon Kruder's current market position and strategies, as well as the current

situation of the economy. Both internal and external factors were discussed, allowing to draft several

business tools in relation to the research including SWOT analysis.

Moreover, I created a survey that allowed customers to express their views on the brand regarding the

business itself and what they thought about the introduction of womenswear within Kruder. The

questions were asked face-to-fac to 20 different people

Instead for my ​secondary research​ ​I conducted a c​ ompetitor analysis on Google Maps to find

like-for-like ​ brands offering similar products in the area within​ 3 km.

Section 3: Findings

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Competitor Analysis

A competitor analysis was conducted to identify Kruder’s competitors in the area.

The analysis identified nine competitors selling both men and womenswear in the area. Each brand was

further researched individually, in order to discover the prices of their products and validity of the

business. The major competitor deduced that Kruder faces is ​Zara and H&M a​ s they both offer similar

products.

Looking at the brand position, Kruder has many competitors on the ‘high’ fashion axis. Kruder is

relatively low on the price axis meaning it will directly gain a competitive advantage over its

competitors. However, customers may link low price to low quality which may not attract some

customers.

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Ansoff Matrix

The Ansoff Matrix is a marketing planning tool that portrays and suggests growth strategies for

a business. Looking at Kruder, by introducing womenswear it will expand through product

development. In order to use this growth strategy, Kruder will need to follow a series of steps

such as design, development and marketing of the newly introduced product to make sure it

will succeed in this market segment.

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SWOT Analysis
SWOT is an acronym for strengths, weaknesses, opportunities and threats. It is used as a strategic

planning technique for spotting the company’s internal strengths and weakness and also its external

opportunities and threats. By carrying out the interview, the key points were synthesised by creating a

SWOT analysis based on the information given out.1

Strengths Weaknesses

● Brand Image ● Costly labor source

● Customer Loyalty ● High costs of production

● Brand Name ● Not seen as very fashionable brand

● International Connections compared to its competitors

● Wider range of products

Opportunities Threats

● Expansion ● Shifting Trends

● Cooperation with new ● Increasing Competition

designers ● Difficult to gain high market share due to

● Purchases are cheaper if they high competitors

are done in bigger quantities

● Economies of scale

● Increased market share and

1
1. PESTLE Analysis Contributor. (2015). Difference between STEEP and STEEPLE Analysis. Available:
http://pestleanalysis.com/steep-and-steeple-analysis/​. Last accessed Feb 2018.

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 growth

The Boston Consulting Group (BCG) Matrix

The boston Matrix is a tool used for marketing management as an approach to product

portfolio planning. It categorized products into two different main areas: Market share and

Market growth and four different categories: The question marks, the stars, the cash cows and

the dogs.

The following is the position of Kruger's products in terms of BCG Matrix:2

2
​Smart Insights. (2019). ​How to use the BCG Matrix - Smart Insights Digital Marketing.​ [online] Available
at: https://www.smartinsights.com/marketing-planning/marketing-models/use-bcg-matrix/ [Accessed 6
Feb. 2019].

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Suits are placed as Stars as the product has a high market share and has a constant market

growth. Turtle-necks are placed at the Question Marks since they have a low market share

compared to the suits.

Section 4: Analysis and discussion

Interview Victor Benjamin (owner) & Goia Ricci (marketing team member):

After carrying out an interview with the founder of Kruder, I uncovered further information on the

planning regarding the future expansion of the introduction of new womens wear.

The interview with Goia Ricci, a member from the marketing team, informed me that Kruder is a brand

that operates by applying three strong key elements. Firstly, an important store design that attracts the

key customers, that speaks the language that is appealing to them. Secondly a product that gratifies the

consumer under all aspects , office hours and leisure. Items that have an updated fit and fashion sense.

Lastly, as the company has a vertical set up it is able to have extremely competitive prices. This must be

conveyed in the store. The price points must be extremely evident and clearly displayed.

Survey to customers:

The limitation in giving the survey to a small amount of customers does not reflect the overall opinion

the introduction of the market segment and of the brand itself. Thinking back on my approach, if I were

to plan the primary research again, I would survey more customers,, as I only talked to 20 of them,

whom could have been biased. Furthermore, the questionnaire may have been more truthful if it had

been anonymous, as customers would have not been pressured and may have expressed their honest

and personal opinions.

Competitor Analysis:

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The competitor analysis shows that there is a significant number of competitors in the area.

SWOT Analysis:

A SWOT analysis evaluated the internal strengths and weaknesses and also the external opportunities

and threats that could affect Kruder's decision on the introduction of the new market segment. From

this SWOT Analysis, one can interpret that Kruder as the brand has an established name, this reduces

the risks associated with new investments. The fact that the business is already well-known this could

lead to the introduction of the investment; making a good amount of sales. In addition due to customer

loyalty, that further reduces the risk of making a loss from the investment. However the SWOT Analysis

gives a clear synopsis of Kruder’s fields of improvements. For instance, one of Kruder's greatest

weaknesses consists in being seen as a outmoded brand in comparison to its competitors. In addition an

external threat consists in the consumers perspectives and preferences that are continuously changing,

thus it is fundamental for Kruder to make sure they precisely understand what their consumer wants.

Ansoff Matrix

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The Ansoff Matrix allowed me to categorise Kruder’s introduction of a new marketing segment

as a market development growth strategy.

This strategy has moderate risk due to the fact that the business will be trying to enter into a

new markets. However advantages of market development include: new customers, increased

revenue, and company growth. If implemented successfully market development strategies can

lead to competitive advantage. The main disadvantage of choosing to employ a market

development strategy adds the risk of cost associated with it. For example, companies can lose

large amounts of money attempting to enter new markets.

BCG

Consumers perspectives and preferences are continuously changing, thus it is fundamental for
Kruder to make sure they precisely understand what their consumer wants.

Section 5: Conclusion
In conclusion, from my analysis the opening of a new market segment seems to be a failing
venture.

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Section 6: Recommendation

Based on my analysis Kruder should not consider to introduce a new market segment. All
findings have clearly shown that it can represent a unsuccessful decision with a big amount of
risk.

I recommend that Kruder to carry more research regarding does more research regarding
location

Appendices:

Appendix 1 - Interview with the owner of Kruder Victor Benjamin

1. Why do you see the investment in womens wear as a business opportunity?

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 2. Will you need to invest in new designers or are your current employees able to produce

women’s clothing?

3. Do you have a high demand for womens clothing line?

4. Do you think the women’s clothing line will keep the same style?

5. What’s your current method of production?

6. What are your main competitors and which one them are associated with women line?

Survey to customers:

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(Number 3: Liu Jo - Number 4: Ralph Lauren)

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Biblography:

1.PESTLE Analysis Contributor. (2015). Difference between STEEP and STEEPLE Analysis. Available:

http://pestleanalysis.com/steep-and-steeple-analysis/​. Last accessed Feb 2018.

2.Smart Insights. (2019). ​How to use the BCG Matrix - Smart Insights Digital Marketing​. [online] Available

at: https://www.smartinsights.com/marketing-planning/marketing-models/use-bcg-matrix/ [Accessed 6

Feb. 2019].

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