Case of the Fashion Channel

Topics: Marketing, Advertising, Reality television Pages: 6 (2069 words) Published: October 6, 2010
The Fashion Channel Case Analysis

Problem Statement:
The case of the Fashion Channel exhibited possible failures and multiple problems. After thorough review of the case I felt the core problem is the failure to focus on a specific demographic. TFC had run off the marketing strategy of “something-for-everyone” for plenty of years and found success in this untouched niche of fashion television. Without competition, this marketing mentality had been very profitable, and started drawing up attention from other networks. With rising competition in this network specialty, TFC was losing CPM (cost per thousand) advertising value and market share. Stuck in the past success of their previous marketing strategy, TFC is in dire need of change. Create a strategy to successfully reach a powerful viewer segment to increase the ratings in highly valued demographic groups to ultimately increase CPM pricing. In the end Dana Wheeler would need to drive revenue growth, increase viewership, and increase advertising pricing. Situation Analysis:

Strengths: The biggest strength of TFC is the fact that they are providing fashion television 24 hours a day 7 days a week. This can play a huge part into the CPM value if you are a company who deals with fashion and wants to reach a specified fashion segment of viewers. The network has also had great past success. They found a niche and created something that has not been seen before, giving their network the competitive edge on their competitors. Being the only network offering fashion, TFC has the experience, expertise, and ability to capture specific segments with high interest in the fashion industry. Weaknesses: I feel their biggest weakness is that TFC is stuck in their old ways, using the pitch of “something-for-everyone”. This is great when there is no competition, but when competition rises there is need to find a more specific market segment. They didn’t know who their target market was nor did they know the demographics of their viewing population. Without targeting a specific range of viewers TFC was not offering advertisers an attractive market to advertise. Their most avid viewer audience consisted of, women between the ages of 35 to 54. Their competitor’s CNN and Lifetime had an avid viewer audience of women between the ages 18 to 34, which was is 50% of household viewers in the Fashionistas segment. TFC was missing out on this market of viewers and needed to change their strategy to regain a portion of this market to stay competitive. Opportunities: The opportunity of gaining this market share was not out of reach. Being the strongest Fashion specific network on television they had a competitive advantage. By investing their marketing efforts into the segments of Fashionistas, Planners/Shoppers, and Situationalists, over time TFC could see a ratings increase of 20%. Advertisers would pay a premium CPM to reach certain groups. These groups consist of men of all ages and women between the ages of 18 and 34. By increasing the ratings in this highly valued demographic, the ad sales of TFC could increase CPM pricing from 25% to 75%, according to Wheeler. These opportunities could be achieved with a well thought out marketing campaign, and implementation strategy. By gaining this marketing segment TFC would accomplish success and keep the image as the top network in Fashion. Threats: A major threat TFC would face by changing their current way of running the network is disappointing the current viewer population. Wheeler knew that the network needed to maintain its overall audience ratings with the cable consumers and the cable affiliate distribution network. A significant change could create the risk of losing its distribution support, which would lower their CPM value and possibly lose the network’s already achieved full penetration of available cable households. Another threat by creating a new marketing campaign and implementation strategy would be that the operation has the...
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