Fashion Channel Market Segmentation Essay

One of TFCs glaring strengths is that it specializes in agency-oriented computer programing. The family is dedicated to fashion schedule 24/7, meaning it is in a spatial relation to influence the securities industry. Secondly, TFC appeals mostly to women between 35 and 54. The connections viewership in the member is 45% comp atomic number 18d to 42% and 40% for animation and CNN respectively. This category has the largest bout of viewers and at the same time, one of those segments that is fit to attract premium pricing. In addition, the confederation operates under the basic cable piece of land. The package has more than 80 billion subscribers in the U.S meaning that a large number of people have access to the channel.Conversely, TFC faces several(prenominal) weaknesses. Firstly, the keep comp whatever has not fully change its operations it only specializes in fashion related programming. This could spell doom for the community, curiously if the current trend is a n indication of the future. Moreover, in that respect is a section of the top counselling that is reluctant to accept change in the organization. The implication is that Danas recommendations may erupt to direct ratified for fear of the unknown. Thirdly, the bliss level of TFCs customers is on the decline. The familiarity is quickly losing customers to the two study competitors, and thither be fears that the trend is sustainable. The other major weakness is that the organization has not segmented its food market. The company ought to segment its market in order to upbeat from the premium lean commissioningd for the highly valued demographics. in that respect be a number of opportunities for sale for TFC in its external environment. To begin, advertisers are pull in to pay a premium for high(prenominal) military rank as well as defined demographic programming. Channels with higher rating are able to charge more for advertising meaning that TFC mountain gain addit ional revenue if assume strategies are developed to help growth its boilersuit market rating. Secondly, thither is a more room for the company to outgrowth its market size. Fashion specific programming is continually gaining prominence among viewers in the U.S. market. In addition, viewers beg on network content and ad is directly related to the cost of advertisement. The company layabout thus increase its ad revenue through with(predicate) merchandise strategies aimed at increasing viewership.One of TFCs preponderating holy terrors is its two chief competitors CNN and Lifetime. The two are constantly eating into the TFCs major revenue base, and may even squash the company out of the market. The second threat is that TFC is only entitled to $1 per subscriber. This is preferably a small portion that cannot fully sustain the companys operations. Besides, in that location is a threat that TFC may get dropped from the basic cable platform if subscribers propitiation fails t o improve. This may mean total breathing out for business. TFCs Central Strategic incommodeThe company appears to lack a intelligibly defined business system. Thecompanys product-market focus is vague. For instance, TFC has not segmented its market into different segments. Alternative Strategic promotional Courses of ActionAlternative 1 in that location are a number of marketing courses of action at TFCs disposal. The prototypic one, and perhaps most important, is market segmentation. The company should divide its market into different segments and constrict on maximizing the revenue for the segment of choice. According to the data provided in the case, a combination of Fashionistas (scored 23.1M) and Shoppers/Planners (scored 42.35M) segments appears the most economical preference for TFC. The two categories of customers are highly multiform in matters related to fashion and are thus a suitable scar for the company. There is as well as economic benefit involved if the com pany opts to back the strategy.Firstly, an mixing of the two segments yields a high gather margin (39%) in comparison to any other choice. Besides, the alternate entrust get off an increase in overall rating by 20%. There is a potential rise in the companys rating from 1.0 to 1.2 consequently take to increased revenue. In addition, this segmentation has the highest fate of viewers 50% (=35% + 15%). The large number of viewers in two segments is thus suitable for the company, particularly given that it entirely specialize in fashion programs. The problem with this alternative is that there is an increment in programming spending by $20 million.Alternative 2The second alternative is broad-based marketing. This involves treating the entire market as a single conference typified by customers with shared needs. The advantage of this strategy is that it is quite cabbageable at to the lowest degree in the short-run. Its adoption is plausibly to achieve the company a net profi t of more than $40 million (=$94.9 54.6). In addition, the approach does not attract incremental programming expenditure. On the other hand, the broad-based alternative will deny TFC the opportunity to recognise premium CPM (Cost per thousand).Alternatively, TFC can opt for Fashionista segmentation. victimization 2007 as abase year, the alternative may rake for the company at least a net income of $ coulomb million (=151.4 54.6). In addition, the approach is likely to boost the companys overall rating from 1.1 to 1.2. The company will also be in a position to increase its charges from $2 to $3.5. Conversely, the Fashionista alternative will lead to an incremental expenditure of $15 million.Decision and Implementation PlanThe saucily promotional plan should be positioned towards a combination of Fashionistas and Shoppers/Planners segment. Although there are a number of risks involved in this strategy, the returns are investing in the strategy. One of the sterling(prenominal) cha llenges for the company is maintaining the loyal customers while at the same time wooing invigorated planners/shoppers and fashionistas. The company must come up with ways of ensuring that they do not mislay some customers. This is achievable through evaluating the programs touristed among the loyal customers and ensuring they are not break off by the new alternative.The company can also benchmark with its customers to learn how they are able to attract a gigantic number of fashionistas. The fact that the alternative may lead to incremental $20 million expenditure presupposes that its implementation is quite expensive. Benchmarking with Lifetime and CNN can help reduce the cost. Finally, the company should devise ways to foster awareness, perceive value, and interest of its products among consumers. This can be achieved through online marketing and ensuring there is appropriate affable media policy in place to void misuse of the marketing platform.