1. Analysing the Environment and Buyer Behaviour week 4
Prof Chris Birch
Business and Enterprise Education

2. Agenda for week 4 H&M – a model answer / structure / approach
Presentations – Pizza places
Group discussion on the presentations
Task set: for next week – Prepare a SWOT and a PEEST (in your groups) on one of Pizza Express / Pizza Hut / Bella Pasta / Carluccio’s - groups will be told which one they are to do in class
Environmental Analysis tools
Buyer Behaviour
For next week – read Case Study 7 – Cappuccino wars – prepare a 300 word preparatory summary of this -

3. H&M – a short summary of the case study:
Founded in 1976 – now has 1800 stores in 35 countries – still growing and a specific international strategy is in-place for the USA, where there are more small stores and less department stores.
Operates in the retail fashion and accessory sector, selling chic and stylish clothes - It’s main market is year old women, but it also has a menswear department, though this is relatively small.
H&M’s main competitors are GAP and Zara – Gap is bigger, but not as commercially successful. They are often trading in the same shopping precincts which means the quest is to achieve bigger market share that competitors. To achieve this, they need a clear, consistent and visionary marketing plan in order that they are well positioned and differentiated, with ready made USPs.
Their competitive advantage comes from a number of factors – Their products are low cost, high value. They are well designed and readily available – They use big name designers to develop special interest lines to attract attention and get people into stores. Designs are modern, distinctive and well researched. They fully understand their market segments and have built up a relationship of mutual trust.
The low price, high value proposition is achieved through excellent cost control and supply chain management. They are able to get new products to market much quicker than their competitors, making them agile and responsive. They have positioned their fashions as perishable goods, meaning that they are not intended to last for long. They are priced to encourage impulse buys when people go into stores, and their brand has become one that represents chic and peer acceptability by those who wear them. It is important that their supply chains are ethically acceptable as their customers are interested and aware, and would not support exploitation.
In summary, H&M know their customers – they have a marketing mix that fits their chosen market segment. They continuously innovate through design and materials to keep products edgy, and price to meet the expectations and spending power of their customers. They always aim to delight, and they are totally market-oriented.

4. A good presentation Understanding / knowledge of subject matter
Well prepared (P6!)
Assess and judge the audience
Clarity and coherence of argument / points
Simplicity and consistency – uniqueness?
Visually stimulating, interesting, engaging
A (good) picture is worth a 1000 words?
When to use multi-media
Verbal and non-verbal communications
The pause – The look – The question
Supplementary materials
Questions and answer sessions
THOUGHT / DESIGN / PREPARATION / PRACTICE

5. Useful weblinks
Search on ‘good presentations’ ‘presentation tips and tricks’ etc – loads of good stuff

6. Tools ... What is a SWOT analysis What is a PEEST analysis
Strengths
Weaknesses
Opportunities
Threats
What is a PEEST analysis
Political
Economic
Environmental / Ecological
Social
Technological
Do a SWOT and a PEEST for the University of Westminster

7. SW Template - example Strengths Weaknesses Advantages of proposition?
Capabilities?
Competitive advantages?
USP's (unique selling points)?
Resources, Assets, People?
Experience, knowledge, data?
Financial reserves, likely returns?
Marketing - reach, distribution, awareness?
Innovative aspects?
Location and geographical?
Price, value, quality?
Accreditations, qualifications, certifications?
Processes, systems, IT, communications?
Cultural, attitudinal, behavioural?
Management cover, succession?
Weaknesses
Disadvantages of proposition?
Gaps in capabilities?
Lack of competitive strength?
Reputation, presence and reach?
Financials?
Own known vulnerabilities?
Timescales, deadlines and pressures?
Cashflow, start-up cash-drain?
Continuity, supply chain robustness?
Effects on core activities, distraction?
Reliability of data, plan predictability?
Morale, commitment, leadership?
Accreditations, etc?
Processes and systems, etc?

8. OT Template - example Opportunities Threats Market developments?
Competitors' vulnerabilities?
Industry or lifestyle trends?
Technology development and innovation?
Global influences?
New markets, vertical, horizontal?
Niche target markets?
Geographical, export, import?
New USP's?
Tactics - surprise, major contracts, etc?
Business and product development?
Information and research?
Partnerships, agencies, distribution?
Volumes, production, economies?
Seasonal, weather, fashion influences?
Threats
Political effects?
Legislative effects?
Environmental effects?
IT developments?
Competitor intentions - various?
Market demand?
New technologies, services, ideas?
Vital contracts and partners?
Sustaining internal capabilities?
Obstacles faced?
Insurmountable weaknesses?
Loss of key staff?
Sustainable financial backing?
Economy - home, abroad?
Seasonality, weather effects?

9. PE Template - example Political Economic
ecological/environmental issues
current legislation home market
future legislation
international legislation
regulatory bodies and processes
government policies
government term and change
trading policies
funding, grants and initiatives
home market lobbying/pressure groups
international pressure groups
wars and conflicts
Economic
home economy situation
home economy trends
overseas economies and trends
general taxation issues
taxation specific to product/services
seasonality/weather issues
market and trade cycles
specific industry factors
market routes and distribution trends
customer/end-user drivers
interest and exchange rates
international trade/monetary issues

10. ST Template - example Social Technological lifestyle trends
demographics
consumer attitudes and opinions
media views
law changes affecting social factors
brand, company, technology image
consumer buying patterns
fashion and role models
major events and influences
buying access and trends
ethnic/religious factors
advertising and publicity
ethical issues
Technological
competing technology development
research funding
associated/dependent technologies
replacement technology/solutions
maturity of technology
manufacturing maturity and capacity
information and communications
consumer buying mechanisms/technology
technology legislation
innovation potential
technology access, licencing, patents
intellectual property issues
global communications

11. EL Template - example Environmental Legal Global policy
Global pressure
Scarcity
Sustainability
Health and wellbeing
Costs of ecological destruction
Risks of ecological destruction
Societal attitudes
Brand impact
Legal
Regulation and Compliance
National legal drivers
Global legal drivers
Influence of Pressure groups
Risk of neglect
Brand damage from adverse legal case
Personal legal liability for Board

12. Porter’s 5 force analysis
a 6th force? – the threat of doing nothing?

13. Porter’s 5 forces references

14. Understanding Buyer Behaviour

15. Factors to consider in Buyer Behaviour

16. Post purchase behaviour
The decision process
Post purchase behaviour
Purchase decision
Evaluate options
Information search
Need recognition

17. Understanding Buyer Behaviour

18. An involvement model Improve differentials Increase engagement
Hi involvement
Lo involvement
Hi value
Lo value
Improve differentials
Increase engagement
Information
Impulse