INDUSTRY ANALYSIS OF

VOGUE FASHION MAGAZINE

Post Graduate Programme in Management

By-GROUP NO 12

Niharika walia

Pankaj joshi

Syed-inan-ul-arsh

Shweta mittal

Arun kumar mourya

Submitted to:

Prof Veeresh Sharma

Indus World School of Business

Greater Noida

Date- 07/03/2011

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S. No TABLE OF CONTENTS Pages

1. ACKNOWLEDGEMENT

2. EXECUTIVE SUMMARY

3. INTRODUCTION

4. OBJECTIVE

5. MATERIALS AND METHODS

6. VISION AND MISSION OF THE COMPANY

7. EXTERNAL ANALYSIS:

Trends in the environment

Demographics

Physcographics

Behavioral

Market segments

PEST Analysis

Porters five forces model

External Factor Evaluation Matrix

8. Competitors analysis

9. Industry Stage

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10.

Internal Resource Based View

Core competency

VRIO framework

SWOT Analysis

11. Vogue Past and Present Strategy

12. Marketing Strategy

13. Organizational Structure

14. Recommendations

15. Conclusions

16. References

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ACKNOWLEDGEMENT

On the completion of our project we would like to thank our faculty Prof. Veeresh Sharma for giving us the

opportunity to work on a project that was challenging as well as completely insightful towards the subject.

We would also thank him for taking out time to interact and assist us on various problems faced during the

process of completion.

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Executive Summary

Fashion Industry which covers the global apparel, accessories and luxury goods market is in an ever increasing

mode. Each year, over $250 billion is spent on fashion (including accessories) in the United States and over $20

billion in revenue is generated annually. Over 4 million people are employed in this industry which includes the

following areas: design, manufacturing, distribution, marketing, retailing, advertising, communications,

publishing and consulting. Fashion industry employers are located just about everywhere but most are

concentrated in New York City, California (Los Angeles and San Francisco), Miami, London, Paris, and Italy,

US, Europe and now the production is abundant in growing economies like India, China and Japan.

In New York itself, the fashion industry generates over $1.7 billion tax revenue with $9 billion in total wages,

thus fashion publishing is an effective business to be in. Publishing by a mode of magazine is an important and

quite sustainable business as it is dependent on an industry such as fashion which is ever growing. This is the

main reason of huge competition in this industry.

Vogue is the leading fashion magazine in the world in advertising revenue and circulation. Today the consumer is

more aware and more demanding with the development of media like television and Internet and Vogue features

itself to be unique and innovative every time and this is the main reason which makes it stand out of the crowd as

well as be a leader among the other global fashion magazines.

Vogue fashion magazine has a good chance of success even though the market is highly competitive. Vogue

magazine can be successful by creating new markets in the fashion magazine industry and using the

recommendation that have been discussed, whilst being backed up throughout with the core competency of the

marketing. We believe that first mover advantage can be achieved despite the competitors are coming up with

updated version of the magazine as their brand image is still by price and style only. Vogue has enough

opportunity to add some exciting features in the magazine that will finally target its end users.

However this advantage is not sustainable in the long term and will be lost if the product is not continuously

updated with new features from time to time. Vogue features famous designers and models to ensure that the

magazine remains forefront to its target consumers.

The report covers the External Analysis of Vogue by explaining the demographics, economic, political, legal,

social, technological and global environment. Certain tools used for it are PEST analysis and Potters Five Forces

model.

Thereafter it is progressed by the internal analysis covering the core competencies of Vogue, resource based view,

VRIO Framework and an analysis of Strengths, Weakness, Opportunities and Threats faced by the firm.

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The report also talks about the competitors, their strategies and market strength. In the end certain

recommendation as well as conclusion to the report is provided.

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INTRODUCTION

COMPANY BACKGROUND

Vogue was founded as a bimonthly publication by Arthur Baldwin Turnure in 1892. When he died in 1909,

Condé Nast picked it up and slowly began growing the publication. Condé Nast, a division of Advance

Publications, operates in 24 countries by being a world leader in exceptional content creation. 1960 was the era

when the magazine began to appeal the youth focusing more on contemporary fashion and editorial features

openly discussing sexuality. In 1973 it became a monthly publication and underwent extensive editorial and

stylistic changes to respond to changes in the lifestyles of its target audience. The current chief in editor is Anna

Wintouris. It has other publications by the nameVogue, British edition and Men’s Vogue . Over the years Vogue

entered different countries across the globe and attained the status of a fashion bible. For 118 years, Vogue has

been America's cultural barometer, putting fashion in the context of the larger world we live in- how we dress,

live, socialize; what we eat, listen to, watch; who leads and inspires us. For millions of women each month,

Vogue is the eye of the culture, inspiring and challenging them to see things differently, in both themselves and

the world.

Besides generating awareness about contemporary fashion, the magazine also focussed on capturing the changing

roles of women and men in society, and the influences of politics and cultural ideas on society and lifestyles. In

India, Vogue was launched in September 2007. Its launch issue captured Indian celebrities and their style secrets

through which Vogue tried to establish its position as a high-end fashion magazine in India. Vogue was highly

optimistic about its success in India due to a growing Indian economy since the early 2000s. As of 2007, the

magazine was banking on the increasing number of affluent and fashion conscious citizens in India.

In the United States, Condé Nast publishes eighteen consumer magazines, two trade publications and twenty-

seven websites that garner international acclaim and unparalleled consumer engagement.

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OBJECTIVE OF THE REPORT

Objective of the report is to study and evaluate the present position of the firm along with it make a thorough

analysis of the external and internal environment of the organization.

Analysing the core competencies of the firm its strengths and weakness vis-s-vis the environment and its

competitors. Focussing on the organizational structure and marketing strategies adopted by Vogue to succeed in

the midst of ever growing competition both in national as well as in a global context.

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MATERIALS AND METHODS

The project is entirely based on secondary research and the proposition is examined from the theoretical

standpoint then empirically investigated using an existing database.

The report is based on data collected through Vogue magazines, articles, reports and studies done, accumulated by

means of internet search engines as well as interviews and data from the newspapers.

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MISSION OF THE COMPANY

For 118 years, Vogue has been America’s cultural barometer, putting fashion in the context of the larger world we

live in- how we dress, live, socialize; what we eat, listen to, watch; who leads and inspires us. From its beginnings

to today, three central principles have set Vogue apart: a commitment to visual genius, investment in storytelling

that puts women at the centre of the culture, and a selective, optimistic editorial eye. Vogue is the eye of the

culture, inspiring and challenging them to see things differently, in both themselves and the world.

VISION OF THE COMPANY

Vogue wants to become top recognised fashion brand amongst all the competitors that exist. It vision is to give

value to its readers by providing all valuable source of knowledge which it can deliver through its magazine.

EXTERNAL ANALYSIS AND MARKET BASED VIEW

TRENDS IN THE ENVIORNMENTS

Vogue is “A one stop shopping guide for a girls every whim”. The general trend in the Women’s magazine

publishing is usually dominant with the practice wherein they capitalize on every woman’s need to learn what is

new quickly and where to find it by providing them with one easily digestible package. These magazines have

engaged in differing marketing strategies but have similar goals: to engage modern, young women and to increase

the number of their advertising pages.

The magazine industry, in particular the women’s sector is continually being challenged by the times. They are

always struggling with how to keep pace with the current trend and thus they always have to change. Vogue

Australia, Harper’s Bazaar, and Marie Claire are considered to be high-fashion magazines which provide tailor

made for an elite group of people wearing clothes that only an elite few could afford. The big challenge today is

to engage the modern woman; new consumers, especially young women. This has led to the growing trend of

reworking the classic model of the fashion magazine. Magazines are reinventing fashion in a more cultural or

social context. It is no longer enough to merely produce a commercial photo anymore, “You have to tell more of a

story, and you have to supply more of a context or personality”

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DEMOGRAPHIC ENVIRONMENT

Demographic:

It consists of dividing the market into groups based on variables such as age, sex, family size, income, occupation,

education etc. Demographic factors are the most popular bases for segmenting customer groups. These

demographic variables are often used in marketing for three reasons: (1) they are easy to identify and measure (2)

they are associated with the sale of many products and services (3) they are typically referred to in describing the

audiences of advertising media so media buyers and others can easily pinpoint the desired market target.

Psychographics:

Under this category, the segments can be formed from the different needs of the consumers. According to Maslow

the needs can be divided into the following 5 areas; physiological, safety, belongingness, self – esteem and self –

actualisation.

Behavioural:

This variable is the third major element that shapes the customer needs. It is concerned with how the product is

used, how much it is used and when it is used. All those elements are likely to shape consumer needs of Vogue.

Example for this, that there was a research carried out by vogue Australia to find out the behavioural aspect of

people in Australia.

With the aid of primary research, a conclusion was drawn that the potential consumers of Vogue Australia is most

likely to be young females who have relatively few financial burdens, tend to be interested in fashion and are

recreation oriented1. The typical psychological profile of readers of Vogue Australia are associated with

characteristics of being young optimist, having a look at me mentality and often socially aware.

Market Segments

The industry in which Vogue is in this stream to provide information to its readers. Vogue competes with the

information providers such as fellow publication houses, newspaper, radio, TV, movies, and all sorts of

information communication medium. Vogue is in the market to provide women with the latest fashion tips,

entertainment and gossip. Its main competitors are InStyle, Marie Claire, SHE, Harper’s Bazaar, Cleo,

Cosmopolitan and B on a global basis. They also face somewhat indirect competition from all media types that

provide information for the latest women’s fashion, entertainment news, and gossip.

Market segmentation is the corner stone of a market-based strategy. A market segment is a specific group of

customers with unique customer needs, purchase behaviours and identifying characteristics. Market segmentation

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opens the door to multiple market-based strategies and greater marketing efficiency. Organizations that sell to

consumer and business markets recognize that they cannot appeal to all buyers in those markets or at least not to

all buyers in the same way. Buyers are too numerous, too widely scattered and too varied in their needs and

buying practices. Different companies vary widely in their abilities to serve different segments of the market.

Rather than trying to compete in an entire market, sometimes against superior competitors, each company must

identify the parts of the market that it can serve best.

Vogue generally created the Market Segment with following three categories:

Aspirers:

Age 20 – 25, most of this target segment is still at university, works part time, affectionate fashion followers and

trendy, they usually are the fashion leaders in their environment, they hope that one day they would be just like

the young female professionals.

Young Professional Female:

Age 25 – 35, earnings in the top 20% of the population, usually in the managerial positions, have tertiary

education or higher, affectionate fashion followers and trendy and they are usually opinion leaders who try new

things and being admired by general female population for their achievements.

Trendy Middle-aged Women:

Age 35 – 45, usually belongs to higher end of the scale of the society most of them in the managerial positions or

housewife of top income households, usually had higher or tertiary education, likes to look elegant, young and

trendy, they are fashion followers as well.

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POLITICAL, ECONOMIC, SOCIAL AND TECHNOLOGICAL (PEST ANALYSIS)

POLITICAL Environment: Political factors include the legal and regulating parameters within which the

firm operates.

It includes factors such as fair trade decisions, anti-trust laws, tax programs, minimum wage legislation, pricing

policies and pollution. These tend to reduce the potential profit of firms. This also includes supplier function,

customer function.

The political situation of Vogue Australia is reasonably stable. The norms of countries where the magazine

operates in US, UK and Brazil, are such that the media has the rights to publish anything that they wish to

thereby, they have the freedom of speech in place, which gives the liberty to the publishers to release information

that might be controversial or even censored. The exchange of information from the publishers to the public

facilitates media to enjoy freedom.

But in Germany and France the extent of freedom of speech is limited not to bring anything censor in public that

would incite sexual orientation or sexual crime.

ECONOMIC:

Economic factors comprise of factors affecting the Vogue company are: (depending upon its region of operation)

Level of disposable income

Propensity of people to spend

Certain factors that affected the company were the magazine's number of subscriptions surged during the

Depression, this also happened during World War II.

Operations for the publishing houses of Vogue Australia, U.S. have surged down from the point where it was

previously operating, though the market has not started getting better but it became difficult in the recession era,

the main reason is considered to be the economic downturn, the countries hit by global recession and thus the

increase in interest rate had impacts on the purchasing power of the households or individuals. With the increased

interest rates, consumers started practicing saving more and consuming less, which has ultimately led to even

more fierce competition for the share of the consumer expenditure experienced by the magazine sector. The

profitability of the publication houses decreased as a consequence of the increase in interest rate.

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According to the Business of Fashion Week - “In the first few weeks of 2009, the outlook for powerhouse

fashion publishers like Condé Nast (which has almost monopolized high-end magazines) looks decidedly grim. In

response to the recession, advertisers are slashing their marketing spend”.1

SOCIAL: The social factors that affect a firm include the beliefs, values, opinions, attitudes and lifestyles derived

from the changes in the educational, demographic, religious, ecological and ethnic set-up.

According to a “cross national market segmentation report”, global advertising for a well-known fashion

brand was perceived to be fairly standardized in Korea and the USA (Jo and Hong, 1998). Park (2001)

also found standardized expression patterns in global ads published by vogue in for clothing (e.g. men’s

wear, women’s wear, casual wear) in Korea and the USA.2

According to Paeet al., 2002; Reece, 2005; Taylor and Raymond, 2000, a number of studies have

examined the standardization or localization of advertising in Asian markets, from a cross-cultural

perspective it has been argued that standardized ads can have different effects in different cultures. Hence,

in advertising the products in the social arena global firms like Vogue magazine must track advertising

effectiveness for alternative positioning strategy in the various nations, though this applies to global firms

in order to market their products but the magazine itself would not appeal or be acceptable to people in

various countries if standardized ads are used in all countries and can have drastic effect on the sale of the

magazine.

Key issue:

Standardized ads using same colors can be dangerous as in some countries like Korea where white is a

color of purity and innocence, white in India is wore on the occasion of death/ funeral. In west it

symbolizes brides, weddings and angels but on the other hand in China and Middle East it is looked upon

as a color of death and mourning thus social factors should be kept in mind while marketing globally as it

may result in loosing popularity and interest of the readers.

With increasing bent towards education and increasing literacy rate of countries like USA, India, Japan

and Australia more of women are getting educated, increased social gatherings are hence serving as a fuel

for the increasing demand for products such as accessories, therefore the demand for the company’s

magazine is likely to increase, mainly because the magazine features products important for this group.

According to a recent study done by the research conducted by Bain & Company with the cooperation of

Vogue magazine says that “style conscious women actively spent in 2010, accounting for nearly 70% of

total U.S. spending in apparel, accessories and beauty.1 Business fashion week magazine.

2 As per cross national market segmentation report

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Due to the recent changes in women’s rights, women are seeking more recognition from the society for

their contribution. They no longer see staying home and taking care of the children the only means of

their life. Women these days are actively seeking to achieve their dreams and fighting for the equality of

the two sexes. There is a tendency of integrating the global perspective into the magazines; the articles in

the magazine cover a wide range of issues faced by today’s women. There are less and less boundaries of

different cultures around the world. In Australia, there are many women who come from different cultural

background; therefore the magazine is planning to cater for the diversified needs of its readers.

TECHNOLOGICAL:

New technological adaptations help in the possibility of new product, its marketing, improvement of its existing

product or prove a help in the manufacturing of its product.

According to a recent data of BOF “technological advancements such as Quick Response or QR codes are

next generation barcodes that can be easily printed on a physical magazine page, but function like online

links. To “click” on them, you point and shoot them with your camera phone and they retrieve relevant

information on customer’s phone web browser. Ralph Lauren and Gucci one of the leading fashion

brands have already started using QR codes a useful tool linking print advertising in magazines to mobile

commerce sites. This makes glossy magazine ads something consumers can browse and shop”.

A USC-Annenberg study (the Annual Internet Survey by the Center for the Digital Future) reported 22

percent of survey respondents said – “they stopped their subscription to a printed newspaper or magazine

because they could access the same content while online”, and this is the main technological change that

the company is facing though the company has its own website but it has available the same articles in the

magazine online also and hence this technological orientation is a cannibalization in itself to the already

existing market share and that to for free.3

Technological advances within publishing have developed rapidly and CNP Australia’s magazines were

some of the first in Australia to be produced utilizing ‘computer to plate’ printing technology, which

enhances the quality of the product. Vogue Australia can utilize recent technological changes to improve

its value creation for the customers and find new ways to manage the information exchange more

efficiently.

3 Report as per Annual Internet Survey by the Center for the Digital Future

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PORTER 5 FORCES ANALYSIS

SUPPLIERS

The focus of this element is to look at the bargaining power of the suppliers and how they shape the industry. The

suppliers for the magazine industry would be the firms providing papers, inks, and any other material that would

be used in the production of the magazine. The power of the suppliers is limited because there are a large number

of the firms who provides the materials necessary for the production for magazines which means that the

publication houses can easily replace suppliers without having too much problem. So the power of the suppliers is

very low.

SUBSTITUTE

The threat of substitutes for Vogue Australia and fellow magazines publishers are great. The industry, which

Vogue Australia is in, provides information on women’s fashion, entertainment and gossips. The information can

be distributed through a number of mediums such as newspaper, TV, radio and other printed advertisements. So

level of substitute available is high.

BUYERS

The buyers have a great influence on the contents provided by the magazines. The buyers have great bargaining

power due to its sheer number of consumers for women’s fashion, the publication houses have to provide

information that is sought after by the public and information that is relevant, interesting to the targeted audiences

otherwise they would lose sales to its rivals. So we see that bargaining powers of the buyers is high.

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POTENTIALENTRANTS

They represent another form of threat to the publication houses. The overhead cost of the magazine industry is not

great however the new entrant would have to be able to secure the distribution channel to ensure the exposure to

the customers otherwise it would not be able to make a significant impact on the overall industry. The threat of

new entrants could therefore be relatively large since the only major factor keeping the new competitors away is

channel access. Information and other elements for publishing a magazine can be obtained without too much

trouble. This is illustrated by the late boom of the total number of magazines launched in recent years. So the

level of intensity of potential entrant will be medium to high.

INDUSTRIALCOMPETITORS

The competition within the market is very intense. The competitions for Vogue cover an enormous range. Vogue

magazines face competition from other titles or media, which provides same type of information such as women’s

fashion, entertainment and gossip. Vogue Magazine also faces indirect competition from magazines and media

covering other topics because they are all competing against each other for the disposal income of the general

public.

EXTERNAL FACTOR EVALUATION MATRIX FOR VOGUE MAGAZINE

After doing the industry analysis we as a group have taken key opportunities and threats related to Vogue

magazine that are critical to the strategies of the firm.

Assigned ratings to each factor to indicate how effectively firm’s current strategies respond to the factors

mentioned.

OPPURTUNITIES WEIGH RATINGS WEIGHTED

SCORE

Horizontal integration 0.10 2 0.2

Personalised

information through

internet

0.10 3 0.3

Utilisation of

information technology

0.20 4 0.8

Use of print technology 0.10 3 0.3

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THREATS

Intense rivalry 0.10 2 0.2

Sophistication of other

technology

0.20 3 0.6

New entrant due lower

fixed cost

0.10 4 0.4

Financial melt down 0.10 3 0.3

Total weighted score 3.1

4.10 GLOBAL ENVIRONMENT

Individual Competitor Analysis

Harper’s Bazaar

Harper’s Bazaar has total circulation of 52,234, total readers amount to 168,000 and with a market share of 6%.

Harper’s Bazaar has relatively low market share and the fact that the market growth is limited is because of its

stage in the life cycle being at maturity level.

Their competitive strategy involved making a magazine more accessible, with profile clothes that women really

wear, with humorous gossipy articles and easy to follow fashion tips. Harper’s Bazaar’s strategy involves a high

degree of change in order to promote its magazine. Harper magazine is a good competitor of Vogue.

Marie Claire

Marie Claire has total circulation of 94,969, total readership attributes to almost 580,000, and it has the market

share of 11%. Marie Claire is a joint venture between Hearst Magazines and Marie Claire Album SA) are

currently matching high fashion with street-ware, endeavouring to provide fashion at every price point. This was

seen in the November 2009 issue, which featured “100 Best Buys Under $100”. Marie Claire also contains

features about women form all around the world. According to the Audit Bureau of Circulations, Marie Claire’s

circulation has jumped up by 8.6% in 2001.

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InStyle

InStyle has total readers amount to 290,000, total circulation of 60,173 and it has the market share of 7%.

According to its competitive advantage and market attractiveness factors, InStyle belong usually adopts unique

strategy.

SHE

SHE has total readers amount to 218,000, total circulation of 70,416 and it has the market share of 8%. The

competitive strategy involves focusing on women apparels across all categories. It largely is dominating in the

apparels division and is not much of a competition to the Vogue magazine.

Cleo

Cleo has total readers amount to 728,000, total circulation of 206,784 and it has the market share of 24%. Its

competitive advantage involves focusing on youth style statement and trend wears.

B

B is the magazine that is famous to fit into the female carry bags easily prompting convenience factor it is first to

introduce the “pocket” size magazine. It realizes the fact that some female carry smaller handbags and the only to

take their magazines with them comfortably wherever they go are for the magazines to fit into their handbags. B

has total readers amount to 370,000, total circulation of 125,000 and it has the market share of 14%. B as a

magazine poses a great threat to Vogue as a whole.

Cosmopolitan

Cosmopolitan has total readers amount to 910,000, total circulation of 206,127 and it has the market share of

24%. The marketing strategies of the titles shown above are generally similar to appeal to younger audiences by

changing their traditional approach to the delivery of the women’s fashion magazine. The costs of operations

would is quite similar across different titles as well with a few exceptions such as for example Vogue Australia

who uses high quality paper.

On the basis of competitors analysis the global market share of the competitors are as follows

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Harper bazaar Marie ClaireInstyleCleo BCosmopolitan Vogue

The following graph depicts how Vogue along with the competitors is positioned. Vogue fashion industry suffers

intense competition due to its rivals and their market share fluctuates with the reactive strategy adopted by firms

from time to time.

INDUSTRY STAGE

COMPARISON OF COMPETITORS

Harper’s

Bazaars

Marie

Claire

In Style She Cleo B Vogue

Industry

stage

Maturity

stage

with low

market

share

High

market

share

Maturity

stage

with low

market

share

Low

market

share

High

market

share

High

market

share

High

market

share

Competitive

strategy

Focus on

woman’s

wear

that

women

really

wear

Exclusively

focus on

high end

apparels

Focus on

style

statement

across all

category

Focus on

women’s

apparels

across

all

category

Focus on

youth

style

statement

Younger

audience

by

changing

their

traditional

approach

Focus on

women

liberation

with style

Statement

Total reader 168000 580000 290000 218000 728000 370000 385000

Total circ. 52234 94969 70173 70416 206784 215000 217000

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5. INTERNAL ANALYSIS AND RESOURCE BASED VIEW

A Resource based view strategy

The resource based view of strategy deals with the competitive environment facing the organization but takes an

‘inside-out’ approach therefore its starting point is the organization’s internal environment. It emphasizes the

internal capabilities of the organization in formulating strategy to achieve a sustainable competitive advantage in

its market & industry. This approach emphasizes the organization’s own set of resources and capabilities as a

determinant of competitive advantage.

RESOURCE:

Tangible-Human resource forms the major source of resource for Vogue magazine. This tacit knowledge can

provide a comparative advantage in this Fashion Industry.

Non Tangible: Vogue utilizes its Marketing Plan, its brand, knowledge & skills of Employees which intangible

resource that it is difficult for competitor to imitate.

5.1 CORE COMPETENCY-

Vogue has assigned a team of experts, who are passionate about the marketing plan to oversee the whole

implementation of the strategy.

Vogue has also encouraged involvement of its workers in the marketing strategies over globe. The workers are

rewarded and recognized for their efforts in the formulation and implementation of the plans in order to keep

them motivated and upbeat about the operations. Sufficient support from the top-level management is also vital to

the success or failure of the marketing plan. So Vogue as an organization follows a bottom up approach which

gives the employees a scope of improvement.

Vogue has encouraged constant feedbacks from the target audiences and its employees. In doing so, Vogue had

made a better the marketing plan to suit the circumstances, adapt to changes in the external environment. This is a

particular important stage of the implementation of the marketing plan, because the management should not

blindly follow the original marketing plan without making any adjustments to suit the ever changing, volatile

business environment and customer demand. Vogue studies the marketing plan with the participation of its

employees and formulates significant strategy.

The success or failure of the marketing plan in Vogue depends much on implementation and control. To make

sure the implementation of the marketing plan is successful Vogue plays a careful attention to the following three

elements that set the foundation of sound implementation of the marketing plan. These are:

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1. Owning the plan

2. Supporting the plan

3. Adapting the plan

Vogue has also applied its new concept during special events such as fashion week, informing the fashion

industry and those who pay close attention to fashion news that they intend to change its strategy and move into a

younger segment. The benefits of announcing its intentions in fashion week are not only the exposure it gathers

but also the chance of getting feedbacks from the fashion industry, which help Vogue determine the

appropriateness of the strategy.

 Vogue as its core competency also utilizes tools of advertising method communication. Sales promotion carries

out the task of boosting sales and increasing the awareness of the target audiences. These are the things helping

Vogue to build distinct capabilities.

VRIO FRAMEWORK FOR VOGUE MAGAZINE

The concept helps to understand the resources that vogue fashion magazine has and what is the competitive

implication it has on the basis of the following resources.

CAPABILITY VALUABLE RARE COSTLY TO IMITATE

COMPETETIVE IMPLICATIONS

MARKETING YES YES NO TEMPORARY COMPETETIVE ADVANTAGE

DESIGN YES YES NO TEMPORARY COMPETETIVE ADVANTAGE

PRODUCTION NO NO NO COMPETETIVE ADVANTAGE

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SWOT ANALYSIS OF VOGUE

Strengths: Vogue does not believe to enter in the market as a first mover and hence as the CEO rightly puts –

“we do not believe in rushing into new markets and look for first-mover advantage.”

When Vogue has entered a little late in India and enjoys a later mover advantage according to the

Vogue’s CEO Vogues present competitors in India are at first-mover disadvantage. Their competitors

moved here when regulations did not allow foreign direct investment in the publishing space, all of them

are licensed brands. Now it’s a bit of a cliché—about strong economic growth, and reports on the number

of millionaires being added on each year.

Vogue will be the first international title to go all alone in India after the government allowed 100 per

cent FDI (foreign direct investment) and hence it enjoys an upper hand over other pre-established brands.

With growing economy people of India now have extra bucks to spend, there has been a retail boom in

the country in the last few years.

Not all the big luxury players are in India as yet and hence there is a competitive advantage enjoyed by

the company."This has put us in an advantageous position, as we are like a majority government and not a

coalition one," says Alex Kuruvilla, managing director of Vogue India.

The unique “Vogue” brand image, which creates brand awareness, recognition and provide emotional

value to its target audiences.

• The main strength of Vogue is their prestigious and up – market image which their readers aspires.

The “computer to plate “printing technology used in the production enables Vogue magazine to produce

magazine that is on the top end of the scale enhancing the graphic presentation of the magazine. The

increase in the quality of the magazine has helped Vogue magazine create customer value compare to its

competitors.

The enduringness of Vogue Australia.

Vogue fashion magazine is the most subscribed magazine on the Internet.

Weakness:

The main weakness of Vogue fashion magazine is its reach to the target audiences. As for example based

from primary research, Vogue is not readily available in some areas of Sydney, hence jeopardizes its

chance of reach of consumers and restricts its market share and growth.

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The main weakness of Vogue fashion magazine is its reach to the target audiences. As for example based

from primary research, Vogue is not readily available in some areas of Sydney, hence jeopardizes its

chance of reach of consumers and restricts its market share and growth.

The contents are relatively foreign to the public due to its European style, which could restricts the sales

of its magazine because the readers are not interested in the contents.

Opportunities:

Glamour is a very successful brand of Conde Nast across the world, it is for a younger audience and

appropriate to be launched in India.

Both GQ and Vanity Fair of Conde Nast publication would fetch in a huge market and have the ability to

compete with the likes of Maxim and FHM in India in men's magazine section.

The revolutions of information technology can prove to be a greater advantage for Vogue to manage its

information and production system more effectively and efficiently.

Due to the increasing popularity of the Internet, Vogue could reach more people via advertising on the

Internet.

The improve in the Internet technology and increasing trust of consumers in providing personal

information on the Internet could see Vogue receive more online subscription and build an extensive

consumer database for monitoring consumer needs and provide them with the chance to create customer

value.

The main opportunity for Vogue is in horizontal integration. Vogue can leverage its brand image and

prestige reputation to provide consumers more products than just its magazines. Vogue can also launch

products such as cosmetics and handbags due to his huge size.

Threats:

The improvement in the information technology could see women’s fashion, entertainment news and

gossip delivered electronically, which could force the printed media industry undergo major changes. For

example the music industry has to change the way to provide entertainment because of the boom of

MP3s.

The improvement in the information technology could see women’s fashion, entertainment news and

gossip delivered electronically, which could force the printed media industry undergo major changes. For

example the music industry has to change the way to provide entertainment

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VOGUE’S PAST & PRESENT STRATEGY’S

People buy a new dress because they’ve seen it in a magazine and they think it is the latest trend, an

Internet website says this is a must have item for the fall season. Vogue set trends for women fashion

industry using marketing strategies. Vogue in the past has not utilized internet as one of it important

source but now they are diverting towards it.

Today, the fashion industry has almost unlimited resources at its disposal.  Information and photographs

that appear on the Internet instantaneously reach millions of women the world over.  Vogue uses its

various web sites, blogs & social networks for promoting the fashion.  People get known which fashions

are in and which are out.  They see the colors and trends on vogue, popular websites.  

A time-honored tradition used by the fashion industry to set trends and market their designs has been to

work with famous people to model their clothes & fashion.  With the advent of such shows as Vogue TV,

MTV and other music shows, the multiplicity of award shows, the public is barraged with a plethora of

designs to choose from. Vogue promotes its magazine on these channels to target its end consumers.

 Famous names in the fashion industry are marketing plus-size fashions even though they were the same

companies who previously designed clothes only for ultra-slim women.  In fact, previous marketing

trends were very much targeted towards a very specific demographic – women with exceptionally good

figures. Vogue is constantly going for a change over.

Vogue past strategy were very limited in terms that they were not employing extensive fashion model but

now Vogue fashion magazine are employing enough models to target its end consumers.

MARKETING STRATEGY

Vogue’s core product is “Fashion”. The magazine itself is a major tool for marketing; it offers the latest

information on fashion to its target audiences. It provides certain augmented products also such as horoscope,

online services, travel, and membership club.

Its actual products are the brand name, packaging, and quality of the articles, styling, and all the feature stories

that is covered in the magazine.

Vogue in Australia follows the distribution channel in the form of distributing via retailer.

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Whereas in other parts of the globe it sell through convenience stores also as it enables buyers to easily access

“impulse products” like magazines.

Some major tools of marketing are:

Advertising

Sales promotion

Supermarket

Trend coffee shops

Special events

STRATEGY ADOPTED:

Each month, Vogue's 50,000 most affluent subscribers would receive a free mini-sample of an Elizabeth

Arden product in the mail, plus the opportunity to follow up with a free full-size sample if they go to a

designated store.

In India Vogue is organizing The Vogue India talent contest for budding fashion writers.

Around the globe Vogue does its marketing by launching videos.

Vogue India drew a criticism for portraying “white models” and hence now it is marketing the magazine

by taking it a step further and tackling the color prejudice within the country, through the release of the

new magazine which says “The dawn of the dusk”, featuring dark, dusky and bronze color women’s.

It is also posting articles about what Vogue is and its love for the Indian market, as a promotional tool.

Vogue Australia gives TV advertising which are shown during times when there are TV shows that fits

with the mentality of the country of operations.

The printed and display medias are used more. These are mainly used because of its reach and they cost

relatively less than television advertising. “Attention grabbing headlines, eye – catching pictures, and

other forms of visual stimuli would be incorporated to gain target audiences attention and achieving the

ultimate goal of delivering the message”.

The advertisement is shown mainly one week prior to the monthly launch of the new issue of the

magazine.

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ORGANISATIONAL STRUCTURE

FLOW CHART FOR VOGUE’s ORGANISATIONAL STRUCTURE

Organizational structure refers to the way that an organization arranges people and jobs so that its work can be

performed and its goals can be met. When a work group is very small and face-to-face communication is frequent,

formal structure may be unnecessary, but in a larger organization decisions have to be made about the delegation

of various tasks. Vogue also uses a structured organizational strategy.

In Vogue as an organization of huge size or complexity, employees' responsibilities typically are defined by what

they do, who they report to, and for managers, who reports to them. Over time these definitions are assigned to

positions in the organization rather than to specific individuals.

There are multiple structural variations that Vogue takes on, but there are a few basic principles that apply and a

small number of common patterns. The following sections explain these patterns and provide the historical

context from which some of them arose. The first section addresses organizational structure in the twentieth

century. The second section provides additional details of traditional, vertically-arranged organizational

structures. This is followed by descriptions of several alternate organizational structures including those arranged

by product, function, and geographical or product markets.

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Holistic View of fashion magazine’s organizational structure

There are certain steps that fashion magazine industry follows as an organizational structure. The following are

the essential steps that depict how certain activity within the organization are structured.

Step 1: Create an organizational chart. Publishing companies are structured with three foundational components

or capabilities. The editorial department will develop and manage the content in your publication or publications.

The success or failure will depend in large part on the quality and relevance of one’s content. The marketing and

sales department is responsible for extracting as much revenue as possible from advertising sales. If an industry

publishes a traditional magazine, then ones can charge an annual fee.

Step 2: Hire a top-notch editorial team. The editor in chief is directly responsible for the content of publication or

publications. Depending on the frequency and length of flagship publication, or the total number of publications

one have, one also needs a managing editor. The managing editor's job is to keep production flowing against

regularly occurring publishing deadlines.

Step 3: Find experienced writers. Look for those with specific experience in your field. Writing about

contemporary topics such as technology, education, politics, media or the travel industry requires at least a sense

of general knowledge and context in order to be credible and compelling. Use freelance writers to achieve

maximum cost effectiveness in your overall editorial operations. Established sources for freelance writers include

Freelance Writing Jobs and Online Writing Jobs.

Step 4: Make a key decision about whether to publish in print or only online, or both. As a general rule, all trends

point to the eventual extinction of printed publications. Unless one have unique or specialized content that will

draw a fiercely loyal audience that will also pay a premium price for it, opt for online publication. The essential

business -- the creation of innovative, market-leading content -- remains the same. There are just no bills for

paper, printing and postage.

Step 5: Create a marketing and sales department with a proven track record exploiting specific business model.

For example, publishing books or a magazine sold on newsstands will be quite different from publishing a comic

book or online journal. We'll need specific expertise and experience for each. But all publishing except book

publishing has one key thing in common: Whether we publish in print or online, or both, most important revenue

stream will be advertising sales. In print, advertising is sold in units such as a full page, half page or quarter page.

Online, advertising is sold as banners of varying sizes or shapes, or as other visual representations on our website.

Increasingly, online advertising is paid for according to how many of our readers actually click through to the

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advertiser's website. In either case, one need an advertising manager with a deep understanding of and experience

in that environment. In turn, advertising manager will hire a sales force. To attract qualified salespeople, we'll

have to pay a draw against commission. But ultimately, their compensation will be in the form of commissions.

MARKETING MIX TACTICS OF VOGUE FASHION MAGAZINES

Marketing mix tactics

The marketing mix tactics consists of product, price, place/distribution, and promotion/communication. The role

of the marketing mix tactics is to help implement and achieve the goals of the marketing strategy of Vogue

fashion magazines.

Product:

“A product is anything that can be offered to a market for attention, acquisition, use or consumption that might

satisfy a want or need. It includes physical objects, services, persons, places, organizations and ideas.”

Vogue core product is “Fashion”. The magazine offers the latest information on fashion to its target audiences. Its

actual products are the brand name, packaging, and quality of the articles, styling, and all the feature stories that is

covered in the magazine. The augmented products that are provided by Vogue magazine are horoscope, online

services, travel, and membership club. A product positioning strategy targets to provide a good source of cash

flow a business by creating an attractive product-price position. It is crucial for having a greater market share. A

desired level of market share depends on the product positioning and the marketing effort of the business.

Vogue as a magazine has emerged as a product positioning target customer needs and provides them with superior

benefits than the main competitors’ product positions. A lower price is powerful in price sensitive markets

whereas in some markets where differentiation is possible and customers are willing to pay higher prices for the

products that deliver greater benefits. Main goal of a product positioning strategy must be creating superior

customer value than those offered by competitors.

In the very competitive women magazine market, offering a superior value to the customer will absolutely

improve the competitive edge. Vogue offers customer value through its high quality product and prestigious brand

image. Vogue offers the latest fashion trends from European fashion centres namely, London, Paris, and Milan.

Additionally, great range of cosmetics and beauty sections are included as core products. In order to create a

greater customer value Vogue offers additional products such as horoscope, travel section, membership club,

online services, stories about successful women, health and diet and where to buy

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Price:

The current consumer price for the Vogue magazine is $7.95(approx). This is affected by both internal company

factors along with external environmental factors. The internal factors of setting the price of Vogue takes into

account of the production costs, marketing objective, marketing mix strategy, and organizational considerations.

Pricing decisions are also buyer-orientated. Vogue also delivers readers that spend well in excess of the female

average. It is evident that many Vogue readers are high income earners and spenders they are elegant and assign

great value to knowing current fashion and lifestyle trends and finding out about them from Vogue. Other factors

in the external environment such as economic conditions have affected pricing decisions at Vogue. The recession

in Asian markets and the increased costs of postage and paper for example, has led to Vogue passing increases to

the advertisers using their magazine. Vogue is doing this by introducing a larger than usual ad rate. As for

example Vogue Australia takes into account of the economic conditions such as the effect of the new budget plan

released by the Australian government, when considering the price to charge its readers. In addition, Vogue

designs its magazine in A4 size. This is a common form in the magazine industry. However, there is a new form

now appearing: a handbag/pocket size, which is half size smaller than an A4 page. This size can only be found in

competitive magazines in the market, but it may pave the way towards a new trend, as it is easier to carry, and of

course cheaper to produce than A4 size magazine while content basically remains the same.

Place/Distribution:

As Companies grapple with globalization, trade liberalization and Information Technology they are forming

complex network of alliances. These include outsourcing, co- branding, product development and Internet

distribution designed to capture more customers and obtain as much value as possible. They are designed to

enable firms to grow faster at lower cost and to gain competitive advantage. Companies need to combine their

competencies to enable them to maintain strong global position in future markets.

Marketing logistics network is a system to deliver the products and services to the end users efficiently and

effectively. Besides this, there is a major part within the marketing logistics networks, and is called marketing

channel.

A distribution channel is a set of interdependent organizations involved in the process of making a product

available for use or consumption by the end user. Vogue follows the distribution channel in the form of

distributing Vogue fashion magazine via retailer (an intermediary).The core competency of vogue fashion

magazine also lies in the use of using its distribution channel effectively from its competitors and its ability to

reach target audience. convenience goods, as Seven (7) – Eleven and Food Plus”4. These C-stores are normally

located near the residential areas and open twenty – four (24) hours and seven days per week. Although selling

prices of goods may be a little higher than usual, these stores are convenient and can satisfy customers’ needs and

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wants at anytime, even four (4) o’clock in the morning. Other than this, many convenience stores operate with

petrol stations, like 7-Eleven. Selling Vogue through newsagents and convenience stores enables buyers to easily

access “impulse products” like magazines.

Supermarket:

News agents & Convenience Stores:

Newsagent and convenience stores are common places that deliver the magazine to the consumers. Convenience

stores are becoming more and more popular nowadays. “Convenience stores are small stores that carry a limited

line of high-turnover

Delivering the magazine through the supermarkets creates the chance for Vogue to build a relationship with

people who tend to buy groceries only. Supermarkets are normally clearly categorized different sections for

different goods. While customers shop around and pass through the magazine area, there might be a chance to

construct the relationship between buyers and producers. Thus, Vogue does not forget to choose supermarkets as

one of its distribution channels as it offers Vogue great exposure.

Trend Coffee Shops:

Starbucks and Gloria Jeans and many other are seen as potential distribution outlets. Both coffee shops possess a

young trendy feeling that echo the personality that Vogue is desires to be associated with in order to appeal to the

younger market segment. They would be used as part of the promotional tools to boost the sales of Vogue and

increase exposure to the right target audiences.

Subscription:

Vogue also utilises a subscription as its marketing strategy. Again, this is the shortest and simplest distribution

channel. Moreover, this also helps marketers to count its turnover easily, and helps marketers to notice whether its

business is stable. Furthermore, following the steps of development of new technology, “E-Marketing” is getting

more and more popular. Other than publishing the magazine, Condé Nast Publications offers Vogue on the

website, thus people who are interested in the magazine can also subscribe through the net to save time and cost.

Promotion/Communication:

“ Promotion is the element in an organization’s marketing mix that serves to inform, persuade and remind the

market of a product and/or the organization selling it in the hope of influencing the recipients’ feelings, beliefs or

behavior”3. Mass communication would be utilized due to its ability to cover most of the intended target

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audiences. The main tool of mass communication is advertising. The other tools of promotion used would be sales

promotion, Direct & Online, and special events. Sales promotion and Direct & Online are chosen based on their

importance for consumer market.

Vogue industry understands the dynamics of the communication process. There are nine elements involved in the

process of the communication. Vogue knows what audiences they want to reach and what responses they want.

Vogue uses this channel effectively as important for its distribution network.

The following is the brief summary of the combination of communication and promotion tools that VOGUE

fashion magazine chooses as its core competency distinctively from its competitors

Advertising:

In advertising, all media types are utilized by vogue. These are broadcasting, printed, and display medias.

Television be the primarily source of advertising due to its potential reach of target audiences and it would also

mean Vogue can deliver the message to its full extent allowing Vogue to incorporate all the elements of the

communication into the message. A credible, trustworthiness and someone who the target audience is or aspired

can identify them to would carry out the delivery of the message. The TV advertising would be shown during the

times when there are shows which fits with the mentality of Vogue (of any country). The suitable shows include

Sex in the City, and Alias. Magazines, newspaper, billboards are the secondary sources of advertising. The printed

and display medias are used also because of its reach and they cost relatively less than television advertising.

Attention grabbing headlines, eye – catching pictures and other forms of visual stimuli would be incorporated to

gain target audiences’ attention and achieving the ultimate goal of delivering the message. The advertisement is

shown mainly one week prior to the monthly launch of the new issue of the magazine.

Sales Promotion:

Sales promotion is the task of boosting sales and increasing the awareness of the target audiences. The venues for

sales promotion events are Starbucks, and Gloria Jeans. Both coffee shops possess the quality that Vogue would

like to see them attached to and both coffee shops capture the traffic flow that is sought by Vogue. Starbucks and

Gloria Jeans both have the trendy image about them, and provide high quality coffee, which attracts lots of people

amongst them, many potential Vogue target audiences.

Special events

Vogue also applies its new concept during special events such as for example Australia fashion week, informing

the fashion industry and those who pay close attention to fashion news that they intend to change its strategy and

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move into a younger segment. The benefits of announcing its intentions in fashion week are not only the exposure

it gathers but also the chance of getting feedbacks from the fashion industry, which help Vogue determine the

appropriateness of the strategy.

Direct and online

Internet has become the latest tool of advertising, revolutionized the method of communication. The benefits of

advertising on the Internet are that it is low cost and reach of its target audiences, due to the vast number of people

now engages in net browsing. Vogue has also link its website with other fashion sites and cosmetics sites, which

share the same mindset or those to whom Vogue would like to be associated with in order to achieve maximum

effect of its communication campaign.

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RECOMMENDATION

Women fashion magazine market is not a very price-intensive market, and most of the magazines have

prices with smaller marginal difference, reducing the current price will not provide desired outcomes.

Therefore, product-positioning strategy should be targeting to create superior benefits than those offered

by major competitors.

Vogue should focus on service and product differentiation. It should target younger women by containing

more about lifestyle, gossip, news about famous people, issues about real life, feature articles,

photographic essays, stories and greater range of fashion with those target middle income levels but still

trendy.

Some stuff like horoscope and travel sections are amongst the most popular sections in many countries

that customers are after. So vogue can seek to spread this feature more so that it has competitive

advantage above its competitors.

There are lots of problem faced by consumer regarding the subscription so Vogue should appoint a proper

subscription methodology so that the consumer faces less problem.4

Vogue Australia should also encourage involvement of its workers in the marketing strategies. The

workers should be rewarded and recognized for their efforts in the formulation and implementation of the

plans in order to keep them motivated and upbeat about the operations.

It should encourage feedbacks from the target audiences and its employees on a constant basis.

4 http://www.consumercomplaints.in/complaints/vogue-india-magazine-c452497.html

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Conclusion

After considering the internal and external analysis of the Vogue fashion magazines it is clear that there are many

strategic issue that need to be considered. Taking into the consideration current account strategy Vogue magazine

have to address the issue by constantly innovating the magazine content. As the key driver change in the fashion

industry is technology Vogue magazine has to ensure that its technology are quite relevant.

Although the market is extremely competitive and highly dynamic through first mover advantage and a focus

upon brand marketing, Vogue will be able to achieve necessary sales volume and satisfy its readers.

To summaries Vogue fashion magazine can be more successful through creation of newer market segment. It can

launch the magazine in Australia where competitors are not performing well to gain the market share and

establish its presence. It must also tie up with some stores as the recommendation given by us in the report.

Finally through the constant use of role models and celebrity Vogue magazine should be able to ensure that the

product remain upfront.

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REFERENCES:

http://www.referenceforbusiness.com/management/Ob-Or/Organizational-Structure.html#ixzz1FSWM3lMy

http://www.marketing-papers.com/vogue-marketing-plan-in-australia.html http://ezinearticles.com/comment.php?Vogue-Magazine&id=3817672 http://www.prweek.com/news/904692/Why-Vogue-magazine-remains-top-pile/ http://www.forbes.com/2007/09/18/vogue-india-interview-markets-equity-cx_rd_0917markets13.html http://www.consumercomplaints.in/complaints/vogue-india-magazine-c452497.html http://www.vogue.com/magazine/ http://fashionablymarketing.me/2009/11/opinion-piece-annaa-winter-hires-obama-social-team-for-vogue-

strategy/ http://www.grailresearch.com/pdf/ContenPodsPdf/

Global_Fashion_Industry_Growth_in_Emerging_Markets.pdf(imp)

http://www.prlog.org/10490611-the-fashion-industry-and-marketing-strategies-towards-women.html http://ideas-smart.com/understand-fashion-life-cycle http://en.wikipedia.org/wiki/Vogue_(magazine) Mint newspaper http://www.bain.com/bainweb/about/press_release_detail.asp?id=27954&menu_url=for_the_media.asp http://www.answers.com/topic/vogue-magazine#ixzz1FGj4C3NN http://www.empower-yourself-with-color-psychology.com/cultural-color.html http://ecommerce.hostip.info/pages/178/Cannibalization.html http://blogs.reuters.com/felix-salmon/2009/07/30/newspaper-self-cannibalization-datapoint-of-the-day/ http://www.livemint.com/2007/08/31233010/8216Why-aren8217t-women.html http://www.articleworld.org/index.php/Vogue_magazine http://www.businessoffashion.com/tag/vogue/page/2 http://www.consumerdaddy.com/consumer-reviews-for-conde-nast-vogue-magazine-p-3274.htm http://www.guardian.co.uk/media/2007/sep/20/pressandpublishing.fashion

MAGAZINES:

Vanity Fair Gloria InStyle Vogue Others.

BOOKS:

Understanding Strategic Management –Anthony Henry

TOTAL WORD: 9458

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