This case study talks about the slowdown in the premium jeans market. The first slowdown was in 2007, after that time premium jeans never the same. Between 2008 and 2010 the premium denim prices fell 10-15 percent over this time period. There were different tactics these premium denim designers including 7 for mankind, True Religion, Diesel, Joe Jeans and Levi Strauss tried to attempt to maintain their positions. Some did this by lowering the price of jeans, creating lower priced jeans (i.e. recession collection and jeggings), creating more brands and stores. This case study also talked about the major effects that things like economic issues (i.e. the recession) and rising cotton prices (due to low stockpiles, heavy rains and flooding) and wash houses had on the premium jeans industry. Although there has been a lot of effects on the premium jeans industry and it’s not where it started that don’t stop these companies from have strategies to get back to their strong financial performance.
Is the premium jeans industry an attractive market?
The premium jeans industry is very much an attractive market. Factors like the recession took a toll on the premium jeans industry. Premium jeans usually run from about $200 on up and people didn’t have the money for that which resulted in market decline, rough material price increase and the market structure let to competition between premium denim suppliers. “The combination of the consumer’s tight pocketbook and the shift toward basic styles constrained the brand’s ability to pass on the raw material price increase to their customers.” There was a lot of up and down sales and profits going on which makes this industry have an attractive market. Many denim labels tried to transform into lifestyle brands that would be a helpful key to continue high growth which is critical to survival. The Lifestyle brands bring potential for sales growth, brand premiums, and protection from downturns in product cycles....
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