Skip to main content

Benetton Story: Big will not beat small any more. It will be the fast beating the slow.

 After reading this text, join the Ransford Business School Online  and you get more
 
 
Take the example of Benetton, founded in Italy in 1965.
 
Benetton, which for years had enjoyed great success with a unique brand of clothing and provocative advertising, had to rethink its marketing strategy when new fast fashion competitors such as Zara and H&M entered the young fashion market and started capturing market share and brand loyalty through a comprehensive marketing strategy. 
 
Zara understood the new patterns of consumer behaviour of teenagers and young adults – markets that craved new styles quickly and cheaply and were happy with ‘disposable clothing’. 
 
Zara studied the marketing mix variables and saw that global supply network management, service process and physical evidence such as store layout and design were more important than traditional marketing expenditure on advertising.

Zara’s advertising budget is 0.03 per cent of its revenues,4 which is very different to Benetton that focused on creative advertising, spending €80 million on advertising alone. Benetton has now seen the errors of its ways, investing over €160 million in modernizing its global supply chain. 
 
It can now deliver new styles to its worldwide stores once a week rather than once a month, which was its traditional delivery strategy. According to Vincenzo Scognamiglio, the head designer of Benetton, ‘Time is my enemy.’ 
 
Zara and H&M have very lean supply chains capable of replenishing shelves in days rather than months. Managing your supply network can be as important as style in the increasingly cut-throat business of mass market cloths.
 
Need more case studies like this? Join the Ransford Business School Online. Ransford is a better way to learn online because it let you school on mobile anywhere. Ransford's students learn from experiences and  apply the knowledge to solve interesting problems. Click here to learn more about Ransford. 

Comments

Post a Comment

Popular posts from this blog

What is Biri marung?

Biri marung" is a term in Chewa/Nyanja, a language spoken in Zambia, Malawi, and parts of Mozambique. It directly translates to "hyena in the sky" or "flying hyena.  It is often used in folklore and traditional beliefs in African cultures to refer to supernatural beings or mysterious occurrences, particularly those associated with witchcraft or spirits. In music, "Biri Marung" is a popular Amapiano track released in November 2024 by South African artists Mr Pilato, Ego Slimflow, and Tebogo G Mashego, featuring Sje Konka, Focalistic, DJ Maphorisa, Scotts Maphuma, and CowBoii.  The song has gained significant attention, with its official audio available on YouTube.  Additionally, it has been featured on various music platforms, including Apple Music.  The track has also inspired dance challenges and covers on social media platforms like TikTok, contributing to its viral status.  "Biri Marung" has been recognized for its impact in the music industry...
Post a Comment
Read more

Sweet Spot

How do you create a digital strategy that involves customers in an energized social community?  How do you create an engaged, active “go-to” website?   Prophet's David Aaaker says, You must change the orientation of marketing from selling the offering, the brand, and firm to becoming an active partner with a shared interest program around a customer’s “sweet spot.” A sweet spot reflects customers’ “thinking and doing” time, beliefs and values, activities and passions, possessions or places they treasure. Ideally, it would be a part of, if not central to, their self-identity and lifestyle and reflect a higher-order value proposition, much beyond the benefits provided by the offering. To illustrate, Pampers went beyond diapers by creating the Pampers Village community that provides a “go to” place for all issues relating to babies and child care. Its five sections – pregnancy, newborn, baby, toddler, and preschooler – all have a menu of topics. Its online ...
Post a Comment
Read more

New ways to business capital

A Business capital, often referred to as capital in a business context, is the financial resources or assets that a company or a sole proprietorship uses to operate, invest, and grow. Traditionally, it can come from various sources, including: 1. Equity Capital: This is the money invested by the business owners or shareholders. It represents ownership in the company and can be in the form of common stock or retained earnings. 2. Debt Capital: Debt capital is borrowed money that the business must repay with interest. This can include loans from banks, bonds issued by the company, or other forms of debt financing. 3. Working Capital: Working capital is the money a business uses for its day-to-day operations, such as paying bills, salaries, and purchasing inventory. 4. Fixed Capital: Fixed capital refers to the funds invested in long-term assets like buildings, machinery, and equipment. 5. Venture Capital or Angel Investment: Startups and high-growth companies may secure capital from vent...
Post a Comment
Read more