Case Analysis of “the Fashion Channel”

In: Business and Management

Submitted By haoli
Words 1214
Pages 5
Introduction and Problem Definition
The Fashion Channel (TFC) was a widely available niche cable network which only offers fashion-oriented programming. It was very successful until other regular networks began to copy its concept and take market share of it, which as a result, had a severe negative effect on TFC’s advertising revenue and affiliate fees. The problem is how to develop the segmentation and positioning, change the current content of programming, and reach the target customers, so as to get back those market shares from competitors, create more revenues and maintain TFC’s early standing.

Situation analysis
 External Analysis:
There were several hundred competitors in this industry and they took note of TFC’s concepts. TFC faced double-edged competition rendering it have to focus on not only ratings and demographics but also program subjects. Moreover, surveys showed that TFC had the lowest indexes, which actually made its affiliate fee at the low end as well. At the same time, the target consumers of competitors were premium CPM (cost per thousand)’s groups, while TFC only appealed to the less valued group.
Ad industry was booming and competition was fierce. Ad buyers began to use surveys and optimizer programs to make decisions, which made rating and target group become more important to network companies.
In general, consumers were fickle. Their disappointment and switch would lead to the losing of operator, affiliates and distribution support. Besides, according to surveys, the women aged at 18-34 presented both high advertising value and high engagement in fashion. Targeting at this group would gain more profits.
 Internal Analysis:
TFC was the solely network which had full-time fashion-specific programming in this industry. It had a large consumer market as well. But it chose “Fashion for Everyone” as theme and did not have any detailed…...

Similar Documents

The Fashion Channel Case

...The Fashion Channel After reviewing firm and market data pertinent to the Fashion Channel, Dana Wheeler compiled four distinct market segments that the channel appealed to. These were fashionistas 15%, planners + shoppers 35%, situationalists 30%, and basics 20%. These are also listed in decreasing order of involvement in fashion. Currently the marketing strategy of TFC involved almost no segmentation and used the original plan that brought TFC much success by appealing to the largest and most broad viewer base possible. Due to increasing competition from non-dedicated fashion networks i.e. (CNN, Lifetime) it was decided a new marketing strategy must be implemented in order to remain the leader in fashion programming both by ratings and advertising revenue. Wheeler designed three scenarios using three different market segmentations approaches. First Wheeler discounted trying to gain any further penetration into the male market. Males were mostly in the basics category and had little interest in fashion at all. The first strategy would be a multi-segment approach that targeted fashionistas, planners + shoppers, and situationalists. This was projected to increase ratings to 1.2% and overall viewers to 1,320k. However this approach would also decrease CPM from ads to $1.80. This approach would also no require any additional programming costs because of its multi-segment strategy. This strategy is projected to decrease the profit margin from 30% to 29%. The......

Words: 505 - Pages: 3

Fashion Channel

...Case Analysis Of “The Fashion Channel” Introduction and Problem Definition The Fashion Channel case illustrates the development of market segmentation options in implementing marketing strategies in a changing competitive environment, and demonstrates how quantitative analysis may be used to support a strategic marketing decision. The Fashion Channel (TFC) was a widely available niche cable network which only offers fashion-oriented programming. It was very successful until other regular networks began to copy its concept and take market share of it, which as a result, had a severe negative effect on TFC’s advertising revenue and affiliate fees. The problem is how to develop the segmentation and positioning, change the current content of programming, and reach the target customers, so as to get back those market shares from competitors, create more revenues and maintain TFC’s early standing. Situation analysis λ External Analysis: There were several hundred competitors in this industry and they took note of TFC’s concepts. TFC faced double-edged competition rendering it have to focus on not only ratings and demographics but also program subjects. Moreover, surveys showed that TFC had the lowest indexes, which actually made its affiliate fee at the low end as well. At the same time, the target consumers of competitors were premium CPM (cost per thousand)’s groups, while TFC only appealed to the less valued group. Ad industry was booming and competition was......

Words: 2428 - Pages: 10

Fashion Channel Case Hbr

...Case Report-1: The Fashion Channel 1) What is expected outcome of each of the targeting scenarios? (complete both the Ad Revenue and Financial calculators to fully understand the financial impact of the scenarios) Ad Revenue Calculator |   |   |   |   | |   | Current | 2007 Base | Scenario 1 | Scenario 2 | Scenario 3 | TV HH | 110.000.000 | 110.000.000 | 110.000.000 | 110.000.000 | 110.000.000 | Average Rating | 1,0% | 1,0% | 1,2% | 0,8% | 1,2% | Average Viewers (Thousand) | 1100 | 1100 | 1320 | 880 | 1320 | Average CPM* | $2,00 | $2,00 | $1,80 | $3,50 | $2,50 | Average Revenue/Ad Minute** | $2.200 | $2.200 | $2.376 | $3.080 | $3.300 | Ad Minutes/Week | 2016 | 2016 | 2016 | 2016 | 2016 | Weeks/Year | 52 | 52 | 52 | 52 | 52 | Ad Revenue/Year | $230.630.400 | $230.630.400 | $249.080.832 | $322.882.560 | $345.945.600 | Incremental Programming Expense |   | $ - | $ - | $ 15.000.000 | $ 20.000.000 |   | 2006 Actual | 2007 Base | Scenario 1 | Scenario 2 | Scenario 3 | Exhibit 5: Financials |   |   |   |   |   | Revenue |   |   |   |   |   | Ad Sales | $230.630.400 | $230.630.400 | $249.080.832 | $322.882.560 | $345.945.600 | Affiliate Fees | $80.000.000 | $81.600.000 | $81.600.000 | $81.600.000 | $81.600.000 | Total Revenue | $310.630.400 | $312.230.400 | $330.680.832 | $404.482.560 | $427.545.600 |   |   |   |   |   |   | Expenses |   |   |   |   |   | Cost of Operations |......

Words: 1027 - Pages: 5

The Channel Fashion

...data presented, The Fashion Channel (TFC) was the first TV channel to offer fashion TV shows, reaching 80 million viewers in the USA, initially giving the company an advantage as the original leader in the market. However, now the company is facing tough competition: “Fashion Today” on Lifetime and “Fashion Tonight” on CNN. At the moment this new competition arose, TFC did not have any plan for strategic segmentation or market positioning. The demographic data shows that 61% of the total audience for The Fashion Channel is comprised of women between 35-54 years old, similar to CNN’s audience. However, the Lifetime audience is 63% women between 18-34 years old; that means that TFC has older viewers than Lifetime. Another interesting figure is that CNN has the greater number of men with 45%, mostly between 35-40 years old. Given these figures, it’s clear that Dana Wheeler is focusing on attracting a younger segment of women to TFC, competing directly with Lifetime. She is not interested in reaching the male segment. TFC dedicates more broadcast time to fashion programming than any other network. However, TFC’s fashion programs rank lower in the ratings than its competitors’ shows. That negatively affects TFC because lower-rated shows are less attractive to advertisers, resulting in lower income from commercials. According to a study conducted by GFE Associates, people who are interested in fashion can be divided into four segments: Fashionistas (serious fashion followers),......

Words: 2354 - Pages: 10

Fashion Channel

...Case 6 - The Fashion Channel 1. ISSUES Founded in 1996, TFC has been the only channel that is dedicated to fashion features 24 hours a day 7 days a week to a broad range of audience. This gave the channel a competitive edge marking it as the fashion leader channel in the market. However beginning 2006, the company noticed that other channel namely Lifetime and CNN were including fashion programs in their network and thus attracting audiences and advertisers. Advertisers had more choices to advertise through now and since these competitors were targeting the younger and stronger groups of audiences, this was affecting the commercial sales of TFC. The company is losing more advertisements to its competitors and it is estimated that TFC would need to drop its ad price by 10% if its performance doesn’t change. The current marketing theme of TFC is “Fashion for everyone” which means they are offering to broad range of viewers to get more viewership but the current market situation interprets that advertisers are interested in going to networks that target the strong segment of the market-Youth. Dana also found that TFC ranks lower in viewership ratings as compared to its competitor because of targeting broad audience and older females. Since ad rates are based on the number and demographics of the target market, lower viewership rate of TFC was resulting in lower income from commercials. Currently 61% of the total audience for TFC is women between 35-54 years old,......

Words: 1999 - Pages: 8

The Fashion Channel: Case Write-Up

...Jeffrey Florence The Fashion Channel: Case Write-Up Decision to Be Made The management team for The Fashion Channel (TFC) must decide which customer segment(s) or ―cluster‖ they should target in their new marketing strategy and how they should position TFC to ultimately increase company revenue. When deciding their marketing strategy, TFC must consider how they can increase their share of the market (ratings) versus the increasingly competitive fashion programming on CNN and Lifetime, and if they can maintain or increase TFC’s satisfaction level among the Large Multi-System Operators. According to Dana Wheeler, senior vice president of marketing for TFC, ―the two key levers to drive revenue growth would be (1) increased viewership (ratings), and (2) increased advertising pricing.‖ Therefore, the scenario that The Fashion Channel will implement must increase TV ratings and advertising revenue. Relevant Facts Ratings One of the most important goals of The Fashion Channel’s new marketing plan was to improve their average rating compared to similar programming on CNN and Lifetime. According to Exhibit 1, TFC’s average rating was 1.0 (1.1 million households), while CNN and Lifetime enjoyed average ratings of 4.0 (4.4 million households) and 3.0 (3.3 million households) respectively. A major difference between The Fashion Channel and the other two networks is the time period of their programming. The main purpose of TFC is fashion and therefore programs around fashion 24 hours......

Words: 1860 - Pages: 8

The Fashion Channel

...Case study Analysis: The Fashion Channel Introduction: “The Fashion Channel” which is a successful cable TV network and which had been started by two entrepreneurs in 1996, with up to date and entertainment features and information broadcast 24×7 which was related to fashion only. The channel was actually dedicated to fashion only and its main audience were women of 35-54 age group. Earlier TFC’s tagline was “Fashion for Everyone” In 2006 TFC has earned the revenue of $310.6 Mn out of which their target was to earn a profit of $230 Mn only through advertisement. Till 2006 TFC was the market leader in fashion related programs and one of its more popular series in 2005 had been “Look Great on Saturday Night for Under $100. In 2006 TFC has realized that some of the other channels like CNN and Lifetime are following the footsteps of TFC and also they are telecasting the programs related to the fashion world, which were now started to become more popular in comparison to the programs of TFC. These channels were giving competition to the TFC directly by taking the share of its ad revenue; these channels were giving a double edged competition to TFC. Norm Frazier, senior vice president of advertising sale, advised that in order to increase the TFC’s ad revenues either TFC has to decrease its ad pricing by 10% or to increase its viewership by improving the quality n contents of the programs. There were around 110 Mn households in USA with cable network and TFC’s average rating...

Words: 1336 - Pages: 6

Fashion Channel Case Study

...Jagdeesh Narayanan Fashion Channel Case Study Submitted On: - November 27th 2013 Memorandum To: Jared Thomas, CEO, The Fashion Channel From: Dana Wheeler, Vice-President Marketing Subject – Proposed recommendations for marketing and advertising plans Date: - November 27th 2013 This memo contains the analysis, recommendations and justifications to help The Fashion Channel to select the appropriate segment for targeting. Recommendation:- The Fashion channel should formulate their new marketing plan to target fashionistas and planners/shoppers. The possible scenarios and segments for marketing concentration Broad Based Marketing | Fashionistas Concentration | Fashionistas and Planners/Shoppers | Pro’s * Net Income 94.9 million Vs. 54.6 million before * No incremental programming expense * Ability to target all 18-34 year old women * Awareness and marketing reach across a broader audience | Pro’s * Net Income 151.4 million Vs. 54.6 million before * TV ratings increase from 1.0% to 1.2% due to premium targeting * Average CPM increases to $3.50 * Facilitates capture of specific market share from Lifetime | Pro’s * Net Income 168.8 million Vs. 54.6 million before * TV Ratings and CPM increase to 1.2% and $2.5 respectively * 50% of TV audience covered * Increase in advertising revenue due to more no of 18-34 year old women audience * Not too specific, covers larger base | Con’s * CPM reduces by $0.20 due to lack of target audience *......

Words: 400 - Pages: 2

The Fashion Channel Case Analysis

...Situational and SWOT Analysis The Fashion Channel is a network dedicated to fashion twenty-four hours a day, seven days a week. Since it was founded in 1996, it has successfully achieved profit growth above the industry average rate and steady revenue. TFC reaches more than 80 million households in the United States, and targets a wide variety of demographics, specifically, viewers between the ages of 35 and 54. Impressed by The Fashion Channels’ success, other markets such as CNN and Lifetime started adding fashion related programming to their networks, becoming a threat to TFC. Currently, TFC customers’ satisfaction is low and revenues are projected to decline. The Fashion Channel must implement a new strategy for segmentation and advertising to attract more viewers to increase ratings and revenue. Strengths: • TFC is the only network dedicated to fashion 24/7. • The channel appeals to women between the ages of 35 and 54. • TFC is included in the basic cable package that is in approximately 80 million households. • It is a unique market. • TFC has achieved full penetration of available households. Weaknesses: • By only showing fashion related programming, it is not a diversified market. • TFC grew too quickly and did not develop a detailed segmentation, branding, or position strategy. • Some of the members of the leadership team are resistant to change. • TFC does not target any specific viewer segments. • Customer satisfaction is......

Words: 6197 - Pages: 25

Fashion Channel Case

...Fashion Channel Case Study MKT 247 Pengxi Lv 10/26/2014 1.SWOT analysis: Strengths: 1. Fashion channel is the only network dedicated solely to fashion, with up-to-date and entertaining features and information broadcast 24 hours per day, 7 days per week. 2. Fashion channel also is one of the most widely available niche networks, reaching almost 80 million U.S. households that subscribed to cable and satellite television. 3. Fashion channel has a large loyal audience base with average 1,100,000 people watching at any point of time. 4. Fashion channel’s revenue and profit grows above the industry average since the founding of the channel. Weaknesses: 1. Fashion channel has never launched any detailed segmentation, branding, or positioning strategy before. 2. Fashion channel is less attractive to cable affiliates compared with CNN and Lifetime according to a recent Alpha research study on customer satisfaction with cable networks. 3. Fashion channel has to compete against networks in buying ratings and demographics as well as against other fashion oriented programs. 4. Although the leading team is aware of the necessity of changing, they may not be ready to take actions because they never changed since the founding of TFC. Opportunities: 1. Strengthen competitive position and secure Fashion channel’s position as a market leader. 2. Focus on specific target markets could bring more steady growth. 3. Increase average rating so that Fashion channel could......

Words: 818 - Pages: 4

Fashion Channel Case Study

...SITUATION ANALYSIS Market Analysis: Fashion-based programming was a growing market as television viewers thirsted for constant updates on constantly changing fashion trends. The Fashion Channel (TFC), created in 1996, was the first channel with the sole purpose of bringing 24/7 fashion information and updates to viewers. There are four main segments of consumers in the fashion-programming market: fashionistas, planners and shoppers, situationalists, and basics. Fashionistas have been very loyal to TFC as they need constant contact and update on fashion. The other segments are much larger than the fashionista segment, therefore there is more opportunity and potential revenue in attracting those viewers. Competitor Analysis: TFC’s main competitors were Lifetime and CNN. Recently, Lifetime and CNN began introducing fashion-based programming that was in direct competition with TFC. Lifetime focused on fashion programs targeting younger women, while CNN was having success with show targeting men. While TFC only had a 1.0 rating, Lifetime and CNN brought in ratings of 4.4 and 3.3, respectively. A study on consumer interest also showed that viewers had greater interests in TFC’s competitor channels. In this study, TFC scored a 3.8, while Lifetime and CNN scored a 4.5 and 4.3, respectively. CNN and Lifetime also beat out TFC in other statistical categories to include awareness and perceived value. These viewer opinions directly resulted in higher ad revenues on......

Words: 347 - Pages: 2

The Fashion Channel Case Study

... Case Study Analysis – The Fashion Channel | Group Number 10Somya Goyal DM16147Anmol Caul DM16109Ravi Agarwal DM16135Vidhit Bhatia DM16159Shorya Umang Jain DM16143Mitali Malpani DM16125 | Case Study Analysis – The Fashion Channel | Group Number 10Somya Goyal DM16147Anmol Caul DM16109Ravi Agarwal DM16135Vidhit Bhatia DM16159Shorya Umang Jain DM16143Mitali Malpani DM16125 | The Fashion Channel Situational Analysis * The Fashion Channel (TFC), a cable TV network focusing solely on fashion was founded in 1996. Since then, it has experience a constant growth without articulating any segmentation, branding and positioning strategy. * Current year revenue is $310.63 M and it was primarily generated from two sources: Advertising ($230.63 M) and Cable affiliate fees ($80 M) (Exhibit 5) * Despite no segmentation and positioning strategy, there current viewership largely consists of women between 35 to 54 years. The channel is currently subscribed by around 80 M out of a total of 110 M households. * Two major channels, CNN and Lifetime have launched fashion – oriented programming to their line-ups, taking away a major share of TFC’s viewership and associated revenue. * TFC’s current goal is to develop a strong marketing, segmentation and...

Words: 916 - Pages: 4

Fashion Channel Case Study

...1. Latar Belakang Perusahaan The Fashion Channel (TFC) adalah satu-satunya jaringan televisi yang hanya menayangkan program fashion selama 24 jam setiap harinya. TFC juga merupakan salah satu dari stasiun TV dengan jangkauan yang luas, hampir 80 juta rumah yang berlangganan TV kabel dan satelit. Pada awalnya strategi pemasaran TFC adalah untuk merebut pasar seluas-luasnya, tanpa segmen khusus, dengan tujuan merebut pemirsa sebanyak-banyaknya. 2. Latar Belakang Masalah Pada awal 2006, TFC menghadapi persaingan dengan pemain baru yang menayangkan program fashion, pesaing terberat yang dihadapi adalah seperti stasiun TV CNN dan Lifetime. Adanya pemain baru ini dapat mengancam posisi TFC sebagai “market leader”, sekaligus merebut kue iklan yang ditawarkan oleh perusahaan pengiklan. Jika kondisi ini tidak diatasi, maka diprediksi bahwa pada tahun berikutnya TFC akan kehilangan 10% atau lebih dari harga per unit iklan. Oleh karena itu, TFC mempertimbangkan kembali strategi bisnisnya untuk meletakkan marketing sebagai dasar pertumbuhan perusahaan ke depan. Namun, TFC sejak awal berdirinya tidak pernah menetapkan strategi yang fokus pada segmentasi, branding dan positioning. Hal ini dapat menimbulkan ketidakjelasan pada strategi marketing yang akan diambil ke depannya. 3. Pembahasan Untuk menghadapi situasi persaingan ini, maka yang harus dilakukan oleh TFC adalah menentukan segmentasi pasar yang akan dibidik, untuk kemudian dilakukan kampanye dan strategi marketing......

Words: 910 - Pages: 4

The Fashion Channel Analysis

...The Fashion Channel Analysis I. INTRODUCTION TFC adalah stasiun jaringan TV kabel yang sukses. Itu tidak lama sebelum jaringan TFC menyadari bahwa jaringan lain mencatat keberhasilan dan mulai menambahkan program fashion juga (seperti CNN dan Lifetime). The Fashion Channel merasa perlu untuk meningkatkan segmentasi, positioning dan iklan untuk mempertahankan eksistensi mereka saat ini. Dana Wheeler dipekerjakan untuk memanfaatkan kekuatan mereka sehingga diharapkan dapat mendapatkan kembali pangsa pasar mereka dari pesaing, membuat lebih banyak pendapatan dan memelihara posisi dan kondisi TFC ini seperti pada awal berdiri. TFC menyadari bahwa mereka perlu fokus pada target pasar mereka yaitu segmen perempuan antara usia 18 sampai 34 tahun. II. PROBLEM STATEMENT Dana Wheeler harus mempertimbangkan langkah-langkah berikut dalam mencoba untuk meningkatkan pendapatan iklan: 1. Menargetkan segmentasi dan posisi terhadap perempuan antara usia 18 sampai 34. 2. Menempatkan lebih fokus pada segmen Fashionista dan menghabiskan penghasilan tambahan pada pemrograman. 3. Menargetkan dua segmen-yang Fashionista dan Pembeli / Perencana. Saluran situasi muncul dari peningkatan kompetisi dari persaingan yang ada. Pada skala 1 sampai 5 (dengan 5 merupakan skor tertinggi), TFC mendapatkan rating 3.8, sedangkan dua kompetirornya mendapatkan rating yang lebih tinggi pada program fashionnya: CNN mendapat rating 4.3 dan Lifetime 4.5. Lifetime menarik...

Words: 3012 - Pages: 13

Case Study Analysis: the Fashion Channel

...Case Study Analysis: The Fashion Channel Introduction: “The Fashion Channel” which is a successful cable TV network and which had been started by two entrepreneurs in 1996, with up to date and entertainment features and information broadcast 24×7 which was related to fashion only. The channel was actually dedicated to fashion only and its main audience were women of 35-54 age group. Earlier TFC’s tagline was “Fashion for Everyone” In 2006 TFC has earned the revenue of $310.6 Mn out of which their target was to earn a profit of $230 Mn only through advertisement. Till 2006 TFC was the market leader in fashion related programs and one of its more popular series in 2005 had been “Look Great on Saturday Night for Under $100. In 2006 TFC has realized that some of the other channels like CNN and Lifetime are following the footsteps of TFC and also they are telecasting the programs related to the fashion world, which were now started to become more popular in comparison to the programs of TFC. These channels were giving competition to the TFC directly by taking the share of its ad revenue; these channels were giving a double edged competition to TFC. Norm Frazier, senior vice president of advertising sale, advised that in order to increase the TFC’s ad revenues either TFC has to decrease its ad pricing by 10% or to increase its viewership by improving the quality n contents of the programs. There were around 110 Mn households in USA with cable network and TFC’s average......

Words: 1330 - Pages: 6

Liplasting (3) | Download | Business ethics fairness in the hiring process