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Group 1 Ba Yucheng 70409 Gkanidou Eftychia 40096 Han Weiqiang 70399 Ma Silin 70401 Zhang Wenrong 70407 AVAPRENEURSHIP

S S E Avapreneur Group1

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Page 1: S S E  Avapreneur  Group1

Group 1Ba Yucheng 70409Gkanidou Eftychia 40096Han Weiqiang 70399 Ma Silin 70401Zhang Wenrong 70407

AVAPRENEURSHIP

Page 2: S S E  Avapreneur  Group1

The interviweeThe SL Footwear industryPorter’s Five Forces ModelKey Success FactorsStrategic GroupsAssessments

AGENDA

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•Jacquelene Slade is

the proud owner of

one main shoe store

•She rents 4 other

stores in Shopping

Malls (Mega Mart,

Scorpian Mall)

•She is a creator

and cooperates

with 1 reseller

•She is active the

past couple of years

THE AVAPRENEUR

Page 4: S S E  Avapreneur  Group1

Dress shoes and sneakers for men and women

Creating a shoe that no one else hasCreating shoes the customers are looking forSmart pricing

STRATEGIC POSITIONING

Page 5: S S E  Avapreneur  Group1

THE FOOTWEAR INDUSTRY

SUPPLIERS

CREATORS

RESELLERS

BUYERS

MARKETING

Page 6: S S E  Avapreneur  Group1

PORTER’S FIVE FORCESSUPPLIERS

POTENTIALENTRANTS

SUBSTITUTES(free/no shoes)

BUYERS(consumers/

resellers)

INDUSTRYCOMPETITORS

(creators)

Rivalry amongexisting firms

(HIGH)

Bargaining power of suppliers (LOW)

Bargaining power of buyers (HIGH)

Threat of

new entrants

(MEDIUM)

Threat of

Substitutes (MEDIUM)

Page 7: S S E  Avapreneur  Group1

‘ The actual cost for my material is the cost of time I spend making them’

Backward

integration of

creators-in SL

shoe creators can

create their own

virtual shoes

without cost or

other limitations

Purchase of raw

material for shoe-

manufacturing is

possible but

scarce for virtual

creators

POWER OF SUPPLIERS- LOW

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‘Buyers are the same as in RL, if you like shoes in RL, you also like your avatar to have shoes’

Many potential

buyers but

relatively few buy.

The older avatars

willing to spend

quite a lot on nice

looking shoes

Lots of stores that

offer anything one

can imagine

Buyers demand for

free products

POWER OF BUYERS- HIGH

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Absence of economies of scale

Incumbency advantages independent of size are

quite significant

Low cost of entry

THREAT OF ENTRY- MEDIUM

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Avatars can build their own shoes-shoes, though, are relatively hard to make-there are ongoing learning programs but they are time consuming

Avatars can go without shoesAvatars can get free shoes the quality of

which is not satisfactory for older avatars

THREAT OF SUBSTITUTES- MEDIUM

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‘ I love to see what my competitors do, sometimes I don’t like what they do and sometimes it inspires me, but it’s more important for me to come up with an idea for a design and style I haven’t seen in SL for my own store.’

DEGREE OF RIVALRY- HIGHPiracyKeep an eye on competitorsSlow growth of the marketNumerous competitors, roughly equal in size

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WHAT DO CUSTOMERS WANT? Customers want well-built, quality shoes that look nice on their

avatars. Extra functions are often quite important. Fancy shoes that they like but can’t afford in RL. Enjoy stores, where they can find new shoes

HOW DOES A FIRM SURVIVE COMPETITION? Compete primarily on combination of price-technology High competition, style, looks and quality in the spotlight Business background important & follow up latest trends WHAT ARE THE KEY SUCCESS FACTORS? Possibility of differentiation through quality and style, that can

appeal to a large portion of the population Multifunctional shoes that combine many features (sound,color) Marketing &WOM Regular exhibition of new items

SL FOOTWEAR INDUSTRY - KSFs

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B&W

QUALITY

THE STRATEGIC GROUPS

AVA CHOO

SHOE CENTER

STILLETTOMOODY

PR

ICE

Low

Low High

High

Page 14: S S E  Avapreneur  Group1

STRATEGIC GROUPSAVA CHOO

B&W

QUALITY

SHOE CENTER

STILLETTOMOODY

PR

OD

UC

T

RA

NG

E

Low

Low High

High

Page 15: S S E  Avapreneur  Group1

Improve industry profitabilityFight against Piracy-

PatentsInnovation and new

designing techniquesOrganize theme

events for people who love shoes

Focus on sneakers-building skills

Excel at sneakers to come up to a sports niche’s expectations

Men’s shoesUse of marketing to

raise brand identification

ASSESSMENTSSuggestions for Shoe Center

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THANK YOU