11 how do you grow a premium brand (1)
TRANSCRIPT
Can Transition expand without losing its elite
aura?Submitted To: Submitted By:Hitesh Jhanji Sir Manpreet Kaur(11404239) Rimaljeet Kaur( Angadbir Singh(11410838) Gurpreet Singh(11401770) Gourav(11402270)
TRANSITIONFirst ULTRAPREMIUM health clubOpened in 1980-8125,000-square-foot facility Staffed at - full time 14Members - 2300(Initial)Services available globally
TARGETS
FEELING OF UNSETTLEMENT
•Operating expenses continued to rise
•Sales growth flattened
•Transition’s membership was aging
•Deliberately created high-cost facilities
CONTINUED.....•Rising Competitors –
Clarkhouse, a top-rated hotel chain Manhattan-based Fitworth health club chain.
•Ambassador hotels had approached with a proposal to carry the Transition clubs at its locations worldwide
MANAGEMENT DISCUSSIONGordon proposed: Drop annual fee and instead charge a one-time initiation fee
With a corporate discount and package pricing for various services
Go down a notch-Transition name at Ambassador hotels
Opening Transition satellite spas at certain corporate headquarters
MANAGEMENT’S RESPONSES
Scott Conner ( Director of sales and marketing )•We can’t offer less; we can’t sell less.•Core strategy is undermined Kim Cole(Company’s number one sales associate)• We’ll lose our marketing edge• Would Tiffany sell a cheap line of jewelry at a department store boutique?
DISCUSSION
CONTINUED…. Frank Casale (Transition’s director of operations and facilities)• If they don’t grow, it’ll be a real squeeze•The budget keeps growing, and the only way to maintain quality facilities is by growing revenues
•Expansion- broadening their niche
EXPERT COMMENTS
WILLIAM CAMPBELL (pricing strategy)
Price discounting – limited context
High risk maneuver
Targeting non-candidates
Flanker strategy
Low risk plan
ROBERT J. DOLAN (importance of value
consciousness)Cost cutting not the only option
Core aspect – better quality
More facilities at a single rate
No issues regarding payment options
Targeted at a specific set of select groups
ANITA K. HERSH (brand identity strategy)
Opportunity to explore & expand
Branding – way to communicate
Innovative ideas to win new customer
Prominent example - Mercedes(C class)
Introducing new related products
PETER H. FARQUHAR( Brand renewal
strategy)Idea of opening corporate satellite Transition spas as
most promising one
Rejuvenate the brand
Leapfrogging competitive offerings
Building a bridge brand
DAVID AAKER(Downscale move Strategy) Introduce horizontal product extensionsEnhancing the company’s service offering Develop concept for a downscale clubo qualitatively different ono overlap with Gordon’s current targetocreate a brand personality for the new offering
MARY SHELMAN(Brand expansion)
Moving down market will put pressure on Gordon’s current pricing structure
Importance of exclusivity as a product attribute
Develop a separate, complementary chainExpansion-signal a change in the company’s core strategy
CONCLUSIONThe changes Gordon proposes are not as simple as a new product offering: they signal a change in the company’s core strategy. Ultimately, tailoring the pricing, partnering with another company, and even opening satellite corporate locations could be good ideas, as long as Gordon is clear about his objectives before he makes a move.