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Harvard Case - Keeping an eye on the brand: Etnia Barcelona's retail strategy

"Keeping an eye on the brand: Etnia Barcelona's retail strategy" Harvard business case study is written by Xavier Oliver, Albert Valenti, Isaac Sastre Boquet. It deals with the challenges in the field of Marketing. The case study is 9 page(s) long and it was first published on : Sep 27, 2023

At Fern Fort University, we recommend Etnia Barcelona adopt a multi-pronged strategy to solidify its brand positioning and drive sustainable growth. This approach involves leveraging its strong brand equity, expanding its global reach through strategic partnerships and targeted market entry, and embracing digital marketing to enhance customer engagement and drive sales.

2. Background

Etnia Barcelona is a Spanish eyewear brand known for its unique designs and high-quality craftsmanship. The company has achieved considerable success in the European market, particularly in Spain, Italy, and France. However, Etnia Barcelona faces challenges in maintaining its growth trajectory in a competitive global market. The case study highlights the company's need to refine its retail strategy to expand its reach and solidify its brand positioning.

The main protagonists of the case study are:

  • David Pellicer: Founder and CEO of Etnia Barcelona, responsible for driving the company's vision and strategic direction.
  • The Etnia Barcelona team: The dedicated team responsible for product development, marketing, sales, and operations.
  • Customers: The diverse group of individuals who appreciate Etnia Barcelona's unique designs and high-quality craftsmanship.

3. Analysis of the Case Study

To analyze Etnia Barcelona's situation, we can employ a combination of frameworks, including:

a) SWOT Analysis:

  • Strengths: Strong brand image, unique product design, high-quality craftsmanship, loyal customer base, strong presence in key European markets.
  • Weaknesses: Limited global reach, reliance on traditional retail channels, lack of robust digital marketing strategy, potential for brand dilution through expansion.
  • Opportunities: Expanding into new markets, leveraging digital marketing channels, developing strategic partnerships, creating innovative product lines.
  • Threats: Increasing competition from established and emerging brands, economic fluctuations, changing consumer preferences, potential brand counterfeiting.

b) Porter's Five Forces:

  • Threat of new entrants: Moderate, due to the need for significant investment in design, manufacturing, and distribution.
  • Bargaining power of buyers: Moderate, as consumers have access to diverse eyewear options.
  • Bargaining power of suppliers: Low, as Etnia Barcelona sources materials from various suppliers.
  • Threat of substitute products: Moderate, as consumers can choose from various eyewear alternatives, including prescription lenses and contact lenses.
  • Competitive rivalry: High, as the eyewear market is saturated with established and emerging brands.

c) Marketing Mix (4Ps):

  • Product: Etnia Barcelona's product strategy focuses on unique designs, high-quality materials, and craftsmanship. The company offers a wide range of styles and collections, catering to diverse customer preferences.
  • Price: Etnia Barcelona's pricing strategy reflects the premium positioning of its products. The company targets a niche market of discerning customers willing to pay a premium for quality and design.
  • Place: Etnia Barcelona's distribution strategy relies heavily on traditional retail channels, including independent opticians and department stores. The company has a limited online presence and a nascent direct-to-consumer model.
  • Promotion: Etnia Barcelona's marketing strategy focuses on brand building and creating a strong brand identity. The company utilizes traditional marketing channels, including print advertising, public relations, and events. However, its digital marketing presence is limited.

4. Recommendations

To address the challenges and capitalize on opportunities, Etnia Barcelona should implement the following recommendations:

a) Enhance Brand Positioning:

  • Refine Brand Identity: Conduct thorough market research to identify key brand attributes and refine the brand positioning statement.
  • Strengthen Brand Equity: Develop a comprehensive brand management strategy focused on building brand awareness, loyalty, and advocacy.
  • Leverage Brand Storytelling: Create compelling brand narratives that resonate with target audiences, highlighting the brand's heritage, craftsmanship, and values.

b) Expand Global Reach:

  • Strategic Partnerships: Explore partnerships with established eyewear retailers, distributors, and influencers in target markets.
  • Targeted Market Entry: Conduct thorough market research to identify high-potential markets and develop tailored market entry strategies.
  • E-commerce Expansion: Enhance the online presence and develop a robust e-commerce platform to reach a wider global audience.

c) Embrace Digital Marketing:

  • Content Marketing: Create engaging content that showcases the brand's unique designs, craftsmanship, and values.
  • Social Media Marketing: Develop a comprehensive social media strategy to engage with target audiences, build brand awareness, and drive sales.
  • Influencer Marketing: Partner with relevant influencers to promote the brand and reach new customer segments.
  • Search Engine Optimization (SEO): Optimize the website and online content for search engines to improve organic visibility and drive traffic.

d) Innovate and Adapt:

  • Product Development: Continuously innovate and develop new product lines that meet evolving consumer preferences and market trends.
  • Technology Integration: Explore the use of technology, such as AI and machine learning, to enhance customer experience, personalize marketing efforts, and optimize operations.
  • Sustainability Initiatives: Implement sustainable practices across the value chain to appeal to environmentally conscious consumers.

5. Basis of Recommendations

These recommendations are based on a comprehensive analysis of Etnia Barcelona's strengths, weaknesses, opportunities, and threats. They align with the company's core competencies, mission, and external customer needs. The recommendations are also designed to address the competitive landscape and leverage emerging market trends.

The recommendations are supported by quantitative measures, including:

  • Increased brand awareness and market share: Implementing a robust digital marketing strategy and expanding global reach will drive brand awareness and market share.
  • Improved customer engagement and loyalty: Creating engaging content, personalized experiences, and loyalty programs will enhance customer engagement and loyalty.
  • Enhanced profitability and growth: Optimizing operations, expanding distribution channels, and leveraging digital marketing will improve profitability and drive sustainable growth.

6. Conclusion

Etnia Barcelona has the potential to become a global leader in the eyewear industry. By implementing the recommended strategies, the company can solidify its brand positioning, expand its global reach, and achieve sustainable growth. The company must embrace innovation, leverage technology, and adapt to evolving market dynamics to remain competitive in the long term.

7. Discussion

Other alternatives not selected include:

  • Focusing solely on traditional retail channels: This approach would limit Etnia Barcelona's growth potential, as it would fail to capitalize on the growing online market.
  • Adopting a low-cost strategy: This approach would compromise the brand's premium positioning and potentially damage its reputation.
  • Ignoring digital marketing: This would leave Etnia Barcelona behind its competitors and limit its ability to reach new customers.

The key assumptions underlying these recommendations include:

  • Consumers are increasingly seeking unique and high-quality products: This assumption supports the focus on product innovation and brand storytelling.
  • Digital marketing is a powerful tool for reaching new customers: This assumption supports the emphasis on digital marketing strategies.
  • Strategic partnerships can accelerate growth: This assumption supports the focus on developing strategic partnerships.

8. Next Steps

To implement these recommendations, Etnia Barcelona should:

  • Develop a detailed implementation plan: This plan should outline specific actions, timelines, and resources required.
  • Establish key performance indicators (KPIs): These KPIs will measure the success of the implementation and provide insights for ongoing optimization.
  • Monitor progress and adjust the strategy as needed: Regularly review the progress and make necessary adjustments to ensure the strategy remains effective.

Etnia Barcelona has a bright future ahead. By embracing innovation, leveraging technology, and adapting to evolving market dynamics, the company can solidify its brand positioning, expand its global reach, and achieve sustainable growth.

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Case Description

Etnia is an eyewear brand known for its stylish designs, particularly of colorful high-quality sun and prescription glasses. After many years relying on a wholesale distribution model with a large international network of opticians, the company had launched its own retail activities in 2017 with a flagship store in downtown Barcelona, followed by an outlet store in the outskirts of the city two years after. Both stores had been successful, quickly becoming profitable while increasing the visibility of the brand - the sales of Etnia in the Catalan region doubled within a year of opening the flagship. In the Spring of 2023, after the turmoil brought by COVID-19 was finally over, the company had now to define the retail strategy for the following years. The case presents the history of the company and its business model, its stakeholders - particularly opticians, which are the company's main wholesalers and that may see a robust direct strategy as a threat, and the nature of the Etnia brand - defined by creativity, color, and rebelliousness. Finally, the case presents several options for Etnia's retail strategy, with their pros and cons, considering its effects on the company's growth, stakeholders, and the brand. The success of the Barcelona and La Roca stores could just be the first step of a fledging new retail strategy. But what should be the next steps?

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