Eccos mulige international ekspansion via diversifikation

Belma Mehinagic

Student thesis: Diploma thesis


Many apparel companies are facing declining sales especially in Europa and are looking for new strategies of growth. One of them is Danish shoemaker Ecco. The aim of this project is to investigate how Ecco can start to produce and sell clothes, to reach a broader consumer segment and increase market shares. In the first part of the project I have identified the most important competition parameters in the clothing industry. I found out that Ecco has many important resources, capabilities, relevant experience and knowledge to compete successfully in the clothing industry. Some of does resources and capabilities can give Ecco sustainable competitive advantages in fashion industry. Ecco has no experience (or knowledge) with manufacturing of clothing. They can overcome this obstacle by outsourcing production to Asia, as the other companies in the industry do. In the second part of this project I have made an investigation of a German fashion market, and German fashion industry to find out how Ecco should enter a German clothing market (premium segment) . Ecco produces a high quality product and charge a premium price for them, and it will be natural for them also to sell premium clothing. German Economy is growing and German consumers have more money to spend. German fashion market is very fragmented, but stabile and big marked witch offers many opportunities. Germany has a solid middle class. Eccos primary target grop is a middle class consumers . Those consumers are demanding quality designed fashion products and have a will to spend money on them. Competition in the German market for clothing is intensive. Ecco is used to intensive competition from a shoes market and they know how to compete in mature markets like German. Ecco is a known brand in Germany, and consumers know what Ecco stands for. Because of that they will probably be more positive about Eccos new products and also buy them. The key to success in the German premium clothing market is strong brand and unique products. Ecco has a strong brand and an ability to differentiate their products from the competitors. The most successful retailer in a German fashion markets are those who have their own mono brand stores in a big German cities where there are a many wealthy costumers. Ecco has a many mono brand stores in those cities. Ecco is a best to tell costumer about its new products and that is why they should open more Ecco stores in Germany to be close to costumers and fulfill all their fashion desires. It is best for Ecco to outsource clothing production to a specialized firm who will be responsible for the overall coordination of production. I found out that Ecco should primary focus on female costumers because they are spending the most money on clothes in Germany. They should mainly focus on consumers from age of 30 to 45, because those consumers are spending most money on clothes in Germany. Ecco want to be seen more like a younger brand (focusing more and more on younger consumers with colored shoes, and accessories) and by focusing on targeting a consumer in the earlier thirties, they can do so. In third part of this project I have made an analysis of the advantages and disadvantages of brand extensions in relation to the launch of the new brand. In order to grow many premium brands within the fashion market, use brand extensions into adjacent categories such as apparel, shoes, leather and perfume. My suggestion is that ECCO should make the brand extension into clothing, instead of developing a new brand. It will be very expensive for Ecco to build a new brand, and I believe that Ecco can make a brand extend into clothing, because they have earlier done it with success.

EducationsGraduate Diploma in International Business, (Diploma Programme) Final Thesis
Publication date2014
Number of pages102