Strategic Management in

Strategic Management in Net-a-Porter.comPresented by




Word count: 2400

Table of Contents

TOC o “1-3” h z u 1.0 Introduction PAGEREF _Toc404125693 h 42.0 Vision, Mission Statement and Corporate objectives PAGEREF _Toc404125694 h 43.0 Situation analysis PAGEREF _Toc404125695 h 43.1 Microeconomic analysis PAGEREF _Toc404125696 h 53.2 Industry analysis PAGEREF _Toc404125697 h 64.0 Market Analysis PAGEREF _Toc404125698 h 95.0 Internal Analysis PAGEREF _Toc404125699 h 95.1 McKinsey 7’S framework PAGEREF _Toc404125700 h 95.2 SWOT analyses PAGEREF _Toc404125701 h 116.0 Marketing Objectives PAGEREF _Toc404125702 h 127.0 Marketing Strategies PAGEREF _Toc404125703 h 127.1 Ansoff Matrix PAGEREF _Toc404125704 h 127.2 Digital marketing PAGEREF _Toc404125705 h 148.0 Implementation strategy PAGEREF _Toc404125706 h 148.1 4 P’s marketing strategy PAGEREF _Toc404125707 h 159.0 Recommendation for future strategy PAGEREF _Toc404125708 h 169.1 Changes required PAGEREF _Toc404125709 h 169.2 Leadership PAGEREF _Toc404125710 h 1610.0 Conclusion PAGEREF _Toc404125711 h 16References List PAGEREF _Toc404125712 h 17

1.0 Introduction

The following paper conducts a strategic analysis for e-fashion company, Net-a-Porter. Net-a-Porter Company has established its business since 2000 as the world’s best online luxury fashion retailer. Net-a-Porter has invited the public to air their recommendations on the how the company should effectively serve its dedicated customers. The analysis program focuses on the following key analysis areas. Profit-oriented organizations concentrate more on competitive rivalry, growth, and cost control (Jeffs 2008). 2.0 Vision, Mission Statement and Corporate specializes in luxury fashion such as exclusive designer apparel and accessories; all sold using online means. The business promotes growth and development in order to become the best online luxury retailer globally.

Vision/Mission: To become the global fashion destination for content and commerce, and offer exceptional, and positive experience to all customers who purchases their product. In addition, the firm sees itself becoming the most fashionable fashion outlet and excels globally through offering best products and services (Best Companies 2014).

Corporate objectives: The objectives of Net-a-Portal e-business fashion retail is to increase) online sales through attracting more online users to view their products in their website and achieve highest level of profits. 3.0 Situation analysis

The situational analyzes process follows the firm’s corporate objectives. A change in the external environment plays a major role in offering new opportunities for an organization to achieve its goals. Currently, Net-a-Porter seeks different innovative ways of improving their customer experience and increase the competitive advantage in the global economy. However, the present technological advancements require more than general knowledge of IT because every firm strives to use a unique strategy that increases its competitiveness. The main areas focused on situational analysis of Net-a-Porter are the microeconomic analysis and industrial analysis.

3.1 Microeconomic analysisThe macroeconomic analysis includes political, economic, social, and technological factors affecting Net-a-Porter firm (PEST analysis). PESTLE analysis deals with different macroeconomic factors that influence organizations’ decision-making process while implementing different development strategies.


The political environment in London favors Net-a-Porter operations. The government policies regulating business operations are not very strict, and the company has managed to fulfill all business obligations required by the Federal Government. The support offered by the state on the issue of internet and online marketing provides Net-a-Porter with an opportunity to diversify its operations.


The main economic factor affecting the operations of Net-a-Porter Company is the varying rates of taxation experienced in different countries. Net-a-Porter is an international company, and its business is prone to many factors including high-interest rates, inflation, and unstable foreign exchange rates.


Social factors play an important role in the success of every organization. Changes in social trends affect business operations in terms of demand of specific products. Net-a-Porter understands different customer needs and with the current consultation, the firm stands a better chance of determining any change in social structures of any target group.

Technological factors

Technological advancements create new opportunities for market growth and diversification in the global market. Advancement in technology especially in London and other developed countries where the organization operates increases its opportunities to gain more online customer pools and increase sales. Additionally, present of the internet allows the company share all its new fashions and designs on the company website where people from all corners of the world can view their products.

Environmental factors

Changes in the business environment as the organization extends its business to different locations create a significant effect on business operations. Different locations offer different weather and climatic conditions. Products must be delivered to customers within the same day and any changes in the environment, like adverse weather conditions, interfere with logistics.

3.2 Industry analysisIndustry analysis helps in determining the position of the firm in terms number of competitors, customer attraction, business operations and strategies implementation (Kaiser 2008). The most essential tool for conducting industry analysis is the Porter’s five forces model, although there exists other tools such as the strategic groups, generic strategy and Key Factor for Success (KFS). Figure 1 represents the Porter’s Five Forces Model. These tools will be used in industrial analysis for Net-a-Porter Company.

Porter’s five forces’ model

Organizations used the Porter’s Five Forces Model in developing marketing analysis aimed at winning the competitive advantage. The five forces according to porter are; threat of new entrants, threats of substitutes, threat from buyers, threat from suppliers, and rivalry among competitors (Porter, 1979). The diagram below shows a representation of the Porter’s five forces model.

Figure 1: Porter’s five forces model (Source: Riley 2012)

Threats of new entrants

The fashion and luxury retail business is one of the most competitive industries in the business world. According to Kottler & Keller (2007), an attractive industry always faces many threats to new entrants but low exit barriers. Net-a-Profit deals with the high number of entrepreneurs entering the fashion and design industry through implementing unique strategies that offer customers with a variety of choices and attracts more online users.

Threats of substitutes

The main factors that determine threats of substitute are the price of substitutes, quality of substitutes, and switching costs to customers. Increased internet accessibility of top selling fashion brands provides better chances for fast-fashion brands to respond quickly and come up with similar fashions with weeks offering more threats (Hill & Jones 2007).

Threat from Buyers

Buyer’s bargaining power offers greater threats to businesses selling same products. The main factors affecting bargaining power of buyers are number of buyers in the market, level of dependency of buyers, switching costs, and buyers’ integration. Switching costs among buyers affects marketing of a product. Increased customer loyalty programs lead to increasing costs in the fashion industry (Hill & Jones 2007).

Threat from suppliers

Suppliers’ bargaining power causes major threats to the firm depending on the number of suppliers relative to buyers, effective substitutes, and levels of dependency on the supplier. Lack of skillful suppliers offering unique brands in the market creates the greatest threat to Net-a-Porter firm. Moreover, organizations experience hardships switching costs to other suppliers because it comes with many risks and threats (Hill & Jones 2007).

Rivalry among existing competitors

Existing competitors’ offer rivalry in the business environment depending on the competitive structure, demand condition, and exit barriers. Available market structure affects the product offering of the organization. Understanding the demand for a product in different locations offers the organizations greater chances of overcoming rivalry threats (Hill & Jones 2007). 4.0 Market AnalysisMany tools assist in conducting marketing analysis of an organization. The nature of business operated by Net-a-Profit and the diverse nature of the modern business environment calls for a close monitoring of marketing strategies in order to adhere to the modern advancements. According to Armstrong and Kotler (2011), organizations should establish effective management strategies through conducting through market analysis on the prevailing market conditions in order to achieve their corporate objectives. 5.0 Internal Analysis

5.1 McKinsey 7’S frameworkMcKinsey 7’s framework assists in analyzing the internal structure of Net-a-Porter Company. The framework aims at analyzing how well the organization is set to achieve its objectives. Figure 2 represents McKinsey 7’s model.

Figure 2: McKinsey 7’s model (Source: Plant 2000)

Strategy: Net-a-Porter establishes the most effective strategies that would ensure the organizations achieve its online marketing goals. Use of the current technological advancements assists in achieving these strategies.

Structure: The organization is structured in such a manner that every department controls their operations. In addition, the organization structure allows easier consultation between people from all levels of management.

Systems: Staff members engage in daily operations of the firm ensuring all areas is operational and working efficiently. Purchase of fashion brands and marketing them through the internet forms the main operations conducted in the firm.

Shared values: The firm maintains shared values that cater for the organization culture. The core values of the firm are highly respected and all activities are geared towards increasing the value of the firm.

Style: Net-a-Porter adopts the situational leadership style. All leaders in the firm adapt their leadership duties to development needs. Leaders work together with workers in ensuring every activity goes as expected. Leaders in the firm suffer from lack of enough knowledge on modern technology.

Staff: Staff members present at Net-a-Porter is professionals in their specific areas of specialization. Most of the employees come from the younger generation that understands application of current technology on sales and delivery of products to end users.

Skills: The company staff possesses the necessary skills and experience gained through working in the interactive environment and through various programs that educate employees on how to utilize their skills and acquire new skills in order to ensure more productivity and growth.

5.2 SWOT analysesStrengths

Enjoys global market presence

Offers quality fashions and designers (brand recognition)

Prices are affordable

Global shipping


Poor leadership styles

Ineffective marketing and sales team

Difficulties connecting to customers that do not use e-commerce


Increased growing numbers of online users day-by-day

Increased sales in United States of America

Potential in luxury and beauty wear for both children and adults


High number of online luxury boutiques

Availability of other online websites offering direct shopping for fashion brands

Online trunk shows

6.0 Marketing ObjectivesThe following are the marketing objectives for Net-a-Portal:

To increase online sales

To increase the number of visitors viewing their websites and social network channels

To market its fashion brands and designs to all countries worldwide through online means

7.0 Marketing StrategiesNet-a-Porter utilizes a number of marketing strategies aimed at achieving the above marketing objectives. The main marketing strategies adopted by Net-a-Porter are Ansoff Matrix and digital marketing.

7.1 Ansoff MatrixNet-a-Porter uses the Ansoff Matrix in marketing its online products to customers in 170 countries across the globe. The Ansoff Matrix has four quadrants, as shown in figure 3, namely market penetration, market development, product development, and diversification (McDonald 2011).

Figure 3: The Ansoff matrix (Source: 2013)

Market penetration

The main strategies used to ensure total market penetration are inviting guests who post on their customer’s blogs to the company website, article marketing posting blogs, posting more articles on social media sites, and inviting online users to contribute to the company blogs

Market development

Market development aims at increasing sales through selling existing products to emerging markets. The company conducts research on geographical location of emerging markets, cultures of new target groups, and availability of other competitors. Net-a-Porter has managed to develop market for its products in more than 170 countries globally.

Product development

In order to win the market competition for luxury and design products, Net-a-Porter keeps introducing new brands to the market. The company uses different unique packaging strategies that attract customer’s attention. Additionally, the marketing IT team creates add-on products where internet users can find their new products upon opening certain pages in the internet.


Diversification allows the firm offers a variety of products and brands depending on customer tastes and preferences. Net-a-Porter offers different brands to different markets across the globe depending on the culture and economic status of the target group. The diversification strategy allows the firm to win customers from all locations where their shops are located.

7.2 Digital marketing

Net-a-Porter firm unveiled the website where the organizations could easily and efficiently carry out digital marketing. Natalie Massenet launched the digital marketing strategy in 1999. The website is accessed by ladies from all parts of the globe and has received many positive feedbacks because of its uniqueness. The digital marketing platform adopted by Net-a-Portal has helped achieving corporate aims through increased online sales, increased online visitors, and increased number of positive feedback from customers. The strategy utilizes social media channels like FaceBook, Twitter, MySpace, and Viber to invite users to visit the website. On the other hand, the firm’s digital marketing strategy faces major challenges associated with poor customer retention, and high number of visitors but a small percentage ends up buying goods (Fall 2012). 8.0 Implementation strategyNet-a-Portal Company requires a very effective strategic management plan in order to achieve its corporate objectives. The marketing strategies currently used by the organization do not meet the demands of present business environment. The best implementation strategy for Net-a-Portal would be the four P’s.

8.1 4 P’s marketing strategyThe four P’s marketing strategy plays an essential role in improving marketing of organizational products both locally and internationally. The 4 P’s are Product, Price, Promotion, and Place (Sighn 2012).


Net-a-Portal deals with sale of fashion and design products for both male and female. Women seem to like fashion more than men and the organization should focus on more strategies that attract women to their website. The NET-A-PORTER 2014 customer base offers better chances for customers worldwide to access fashion and design products.


The price of the commodity matters a lot in marketing. The price offered for different fashions must be consistent with the quality of the product and the type of clients. Women fashion brands should be sold at cheaper prices compared to men designs because women make more purchases. In addition, the marketing agents should listen to the voices of clients in order to offer prices that favor their pockets.


All purchases in Net-a-Porter are made online. The company should improve the appearance of their website by putting more attractive logos, colors and photos in order to attract the attention of viewers. E-commerce websites offer best platforms for marketing products internationally.


After putting the product on the right place, the company should embark on promotion. Online promotion should occur through various forms. The best forms of promotion would be through social channel networks. The marketing team should unveil the official FaceBook page and request more people to like the page. 9.0 Recommendation for future strategy

9.1 Changes requiredThe company should do an overhaul of all its IT database and purchase new and modern computers that are fast and reliable. In addition, the company should employ more team to cater for the increasing number of online users who are always looking for information regarding the company products

9.2 Leadership

The company needs to change its leadership structure and include more competent people who are quick in adopting change.10.0 Conclusion

According to chewable (2009), success of an organization in the present business environment depends on its ability to adopt Information Technology and use it effectively. Organizations today have turned into online marketing because it has proved to improve customer turnout and sales.

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