Bienvenido a Mxico, el Secreto de Victoria

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Bienvenido a México, el Secreto de Victoria

• The Expansion of Victorias Secret into Mexico

Aparna Donthi Man Tsun Lee Bouphavanh
Mathouravong Marisol Rivera Nicole Winkle
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Research Overview

• Primary Research
• In-depth survey
• Industry Analysis
• Demographics
• Perfume Industry
• United States
• Mexico
• Company Analysis
• Situation Analysis
• STP
• Marketing Mix
• Implementation

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Executive Summary

• Due to the declining market in the U.S. and
  growth in Mexico, Victorias Secret has the
  potential for a sizeable fragrance market in
  Mexico.
• Mexican consumers product values are congruent
  with that of the Victorias Secret brand image.
• Significant similarities and differences in
  marketing Victorias Secret brand in Mexico.

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Primary Research

• Bilingual In-Depth Interview
• Parallel Translation
• Administered in Cuernavaca, Mexico
• Goals of the Interview
• Awareness of Victorias Secret in Mexico
• Product Perceptions/Knowledge
• 4 Ps
• Competitor Awareness

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Situation Analysis

• Mexican Consumers
• Highly rank service and price
• Have short term view of products initial price
  means everything
• Receptive to high quality products that are sold
  in smaller packages
• Implications
• Victoria Secret offers great service/personal
  attention to customers
• Offers smaller, affordable product selection

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Situation Analysis (Cont.)

• Company
• High International Awareness
• Sales Growth 8.1 (2003)
• Competitors
• Estee Lauder, Avon, JC Penney, Lancôme
• Collaborators
• CBS, Musicians
• Supermodels Heidi Klum, Tyra Banks,
• Environmental Factors

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Perfume Industry Analysis

• Perfume Industry in The United States
• Perfume industry to grow at declining rate over
  next five years
• Dominated by female fragrances (2/3 of sales)
• Male fragrances accounts for 23.5 of market)
• Implications
• Declining U.S. market
• Seek International Growth
• Mexican Perfume Market

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Mexican Demographics

• Male customers account for 70 of perfume sales
  despite the fact that mens fragrances represent
  1/3 of the market
• Women between 40-50 years can afford to pay
  40-150 for a bottle of perfume
• Mexico City represents 52 of sales
• Guadalajara and Monterrey have large potential
  for sales

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Mexican Market

• Perfume Industry in Mexico
• Female Fragrances Experience Dramatic Growth
• 2001 - 253 million
• 2006 Predicted 348 million (37.5 increase)
• Many competitors (Satisfactory
  salessuggeststhere is still space for new
  launches)
• Black market
• Relevant to price and distribution

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Mexican Economy

• Increased Purchases of Luxury Commodities
• Economic recovery in 1996
• Increase in private consumption
• International Companies are increasing their
  presence

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Victorias Secret (STP)

• Positioning
• For the woman who wants to feel sexy,
  sophisticated, and ultra feminine
• Segmentation
• Does not segment based on age
• Segment based on products
• various Victorias Secret brand fragrances
  appeal to different aspects of the Victorias
  Secret woman
• Targeting
• Target how a woman feels, rather than her age,
  ethnicity, or other specific demographic

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VS Marketing Implementation

• They cross promote between their online and
  offline operations.
• 360-degree brand connects all 3 selling
  channels (catalogs, the stores, and website)
• Sex appeal is portrayed through advertisements
  and promotions.

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Expansion into Mexico

• Segmentation and Targeting
• Highly populated/developed cities
• Mexico City, Monterrey, Guadalajara
• Product selections to appeal to different tastes
  and preferences
• Low price-sensitivity
• Positioning
• Provide high quality product that delivers a
  flawless experience
• Creates an image of sensuality and femininity

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Who and How Old?

• More women between the ages of 19-25 responded to
  the survey.

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Interest
Are you interested in shopping at a Victorias
Secret store?
Are you interested in receiving a catalog?

• Women are more apt to put their name on a mailing
  list to receive Victorias Secret catalogs than
  are men , thus it is important to target women
  with catalog advertising mediums.
• Women are interested in shopping at Victorias
  Secret more so than men. Tactics emphasizing
  femininity and sensuality would be appropriate.

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Where and How?

• Focus on print ads
• De-emphasize online ads

• Brick and Mortar
• Provide service
• Provide quality
• Discount store
• Black market

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Characteristics of Target Market

• Mexican consumers are willing to pay Victorias
  Secret price-range.
• Customers are not price-sensitive.

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Marketing Mix

• Product
• Victorias Secret perfume lines
• Price
• Equivalent to USD range between 15-60
• Place
• Open retail stores in major cities
• Primary distribution channels specialty/beauty
  stores and discount stores
• Promotion
• Fashion magazines, catalogs
• People, Cosmopolitan, Elle
• Mailing of 364 million catalogs worldwide
• Less emphasis of online sales

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Goals

• Short-term (one year)
• Establish test markets in urbanized cities
• Monitor sales and product awareness
• Evaluate effectiveness of distribution options
• Long-term
• Evaluate potential production possibilities in
  Mexico
• Gain competitive market share
• Evaluate opportunity to expand to lingerie and
  clothing line

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Summary

• Emphasis on fashion magazines, catalogs, and
  television ads, not internet
• Specialty stores and discount stores
• Acknowledge differences in sex roles when
  promoting
• Women are seductive, not assertive and aggressive

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QUESTIONS?