Billabong Case Study
Introduction
Billabong International Limited (BBG) produces surf wear, sports apparel and accessories for the surf, skate and snowboard markets (Macquarie, 2012). The firm recorded an 18.4% decrease in
net
profit
to
A$119.1
million
in
2011
(Billabong Shareholder Review 2010/2011). After intense acquisition efforts, which saw
Billabong buying over 11 brands (Appendix A), the company was forced to undergo a major restructuring, closing 150 stores and cutting 400 jobs worldwide (AAP, Feb 2012).
The report will be analyzing the Billabong brand, specifically its surf wear in Australia, to identify the underlying crucial issues that must be addressed. Current opportunities and threats that Billabong can leverage on will be prioritized, then weighed against the firm’s internal strengths and weaknesses in order to increase sales. Solutions in line with
Billabong’s mission of striving to set new benchmarks through youthful lifestyle brands and experiences will be explored.
Situation Analysis & Problem Identification
To identify the key issues and opportunities that Billabong is facing, an analysis was conducted on the following five areas. Appendix B shows the consolidated list of issues
Billabong faces.
1. Customers (Appendix C)
The Customer Experience Cycle was used to identify key opportunities such as improving the Purchase context through greater interactivity with customers. Another opportunity was to promote an eco-friendly way to dispose of used products while
gaining rewards.
2. Competitors and Context (Appendix D, E & F)
A PEST analysis of the Australian market reveals a demographic shift to the under -15s market (Euromonitor 2012), which was an opportunity for Billabong to target. Using
Porter’s Five Forces (Appendix E), a Positioning Map and Competitor Threat Analysis
(Appendix F) to analyse the boardsport industry confirmed that competition from a few big surf brands was high and that all had a
Billabong International Limited (BBG) produces surf wear, sports apparel and accessories for the surf, skate and snowboard markets (Macquarie, 2012). The firm recorded an 18.4% decrease in
net
profit
to
A$119.1
million
in
2011
(Billabong Shareholder Review 2010/2011). After intense acquisition efforts, which saw
Billabong buying over 11 brands (Appendix A), the company was forced to undergo a major restructuring, closing 150 stores and cutting 400 jobs worldwide (AAP, Feb 2012).
The report will be analyzing the Billabong brand, specifically its surf wear in Australia, to identify the underlying crucial issues that must be addressed. Current opportunities and threats that Billabong can leverage on will be prioritized, then weighed against the firm’s internal strengths and weaknesses in order to increase sales. Solutions in line with
Billabong’s mission of striving to set new benchmarks through youthful lifestyle brands and experiences will be explored.
Situation Analysis & Problem Identification
To identify the key issues and opportunities that Billabong is facing, an analysis was conducted on the following five areas. Appendix B shows the consolidated list of issues
Billabong faces.
1. Customers (Appendix C)
The Customer Experience Cycle was used to identify key opportunities such as improving the Purchase context through greater interactivity with customers. Another opportunity was to promote an eco-friendly way to dispose of used products while
gaining rewards.
2. Competitors and Context (Appendix D, E & F)
A PEST analysis of the Australian market reveals a demographic shift to the under -15s market (Euromonitor 2012), which was an opportunity for Billabong to target. Using
Porter’s Five Forces (Appendix E), a Positioning Map and Competitor Threat Analysis
(Appendix F) to analyse the boardsport industry confirmed that competition from a few big surf brands was high and that all had a