Fredericks of Hollywood Company Analysis

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Increasing Sales and Promoting the
Frederick’s of Hollywood’s Brand Image

Prepared by Ellen Fraser
Director of Marketing

Submitted to Carol Davis
CEO, Frederick’s of Hollywood

May 15, 2011
Abstract

The following report discusses Frederick’s of Hollywood’s position in the intimate apparel industry and how it has continually decreased since our main competitor, Victoria’s Secret, entered the market. It will discuss our company’s history leading up to where we are now and what issues we face in our current state. The report will then lay out three potential options our company can implement in order to improve our company and increase our sales and market share. The three options I have come up with to remedy our current issues are: (1) To increase our publicity by revolutionizing our advertising strategies, (2) alter our store layouts to promote a more appealing company image, and (3) to bring in new product lines and refocus our merchandise to grow within our industry. This report will go over these options and carefully analyze them to determine the effectiveness of each one. I have evaluated the potential options according to a 4-part criteria. This criteria consists of analyzing the (1) competitive advantage, (2) risk and cost, (3) profitability, and (4) ease of implementation of each option. After my in depth analysis of these option, I will lay out my recommendation for what the company should do to ensure their best interests are taken care of.

Table of Contents

Abstract
Mission Statement
Company Mission Statement
Report Mission Statement
Executive Summary
Introduction
Company History
Competitors & Industry
Current Issues
Analysis of Options
Criteria
Option 1: Increase advertising
Option 2: Alter store layout
Option 3: Refocus merchandise
Decision Matrix
Recommendation
Implementation Plan
Evaluation
Contingency Plan
Conclusion
References
Appendix A: Informative Memo
Appendix B: Options Memo
Appendix C: Press Release

Mission Statement

Company Mission Statement
The Frederick’s of Hollywood Group’s mission is to create products that make women feel sexy, desirable, and confident. Our goal is to expand our presence through quality, innovation, value, and an unrelenting customer focus.

Frederick’s of Hollywood shares values that place a premium on internal and external collaboration, integrity, excellence, and dignity for the individual. We maintain a respectful, friendly, and productive workplace, as well as a challenging and rewarding work environment for our associates.

Report Mission Statement
The purpose of this report is to discuss where Frederick’s of Hollywood currently stands in the market place and what we can do to increase our market share and brand recognition within the industry. This report will present what issues our company faces in it’s current state and several potential options on how to remedy these issues.

Executive Summary

Frederick’s of Hollywood has been steadily losing our edge in the industry and falling behind our competition. Our main competitor, Victoria’s Secret, has been consistently eating into our market share and profit margin since they entered the intimate apparel industry in 1977. Although Frederick’s has remained innovative in terms of design and management, we have failed to respond accordingly to our competitors ability to market their products and create mass brand recognition. With our topline growth continuing to deteriorate, now is the time we need to take steps to improve our company, raise our profits, and increase our brand recognition within the industry. In order to do this, we need to take the proper steps to grow and expand our company.

This report will detail and evaluate three potential options to address this issue. The options believed to help solve our company’s current issue and maximize both our exposure and profits are: * Increase Frederick’s of Hollywood’s advertising and publicity...
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