Marketing Management - Blue Turtle Clothing Company Case Study

Marketing Management

COMM 2035

Module 10

Blue Turtle Clothing Company Case Study

Executive Summary

Carlie Melcher is owner of Blue Turtle Clothing Company (BTC), which began operations in May, 2003 with the opening of a seasonal clothing and accessories store in Sauble Beach, ON.  BTC sold women’s casual and athletic clothing along with complementary products such as children’s clothing, accessories and emu oil.  In addition to the store BTC distributed its clothing through two home parties and two fitness clubs in London, ON and advertised its products on the BTC web site.  The company had a net loss of $2,117 in the fiscal year ended April 30, 2004.  Melcher is disappointed with the performance of BTC and is considering which distribution channel option will generate the highest level of sales and revenue.  

Melcher is BTC’s greatest strength as she has education and business experience in marketing and advertising, however BTC has limited financial resources, the store was operating at a loss and very little money is available for promotion.  BTC has an opportunity in the home party market in London, ON as there is no direct competition in this market niche.  Threats to BTC’s success are competition from off-price stores such as Winners, outlet malls, mass merchandisers and department stores.

Retail sales of clothing and accessories in Ontario were $8.5 billion in 2004 with women’s clothing and accessories accounting for more than half this total.  London, ON had a population of about 340,000 with approximately 26% being women between 15 and 50 years of age.

BTC’s target segment based on demographics and lifestyle is the family segment.  This is a large and growing market segment with steady and predictable buying patterns.  The segment is seeking good quality clothing at reasonable prices for the adults and trendy, name-brand clothing at value prices for the children.   BTC’s product line is moderately priced, trendy, brand-name clothing and accessories, which is a good fit for this market segment.  BTC can differentiate itself from its competitors by promoting the home parties as a relaxed, fun social event with friends vs. a mall or department store shopping experience.

The Sauble Beach store is at a competitive disadvantage by not being located in the prime retail area with BTC’s competitors, resulting in disappointing sales volumes.  This is confirmed by the financial analysis which shows an operating loss for the store.  Financial analysis also indicates BTC must increase its margins to 50% of sales price in order to become profitable.

Keys to BTC’s success are the successful recruitment and training of a sales team and home party hosts and to promote the home parties in a cost effective manner.  Key uncertainties are the acceptance of the home party concept in the marketplace and potential entry into the home party market by competitors.