Nokia Case

Executive Summary

Levi Strauss has been a quality clothing company for the last 150 years. They were the first producer of denim and found their denim jeans and koveralls to be their most successful product early on. Levi Strauss is one of the best known brands world-wide; they are known for the quality and durability of their jeans. This is why in the past, Levi Strauss has held the largest section of market shares in their industry. However, in recent years, consumers have started to favor other brands that they consider more fashionable, and value the durability of jeans less than in the past. The jeans industry has also become more highly competitive and widespread. Levi's must compete with the low priced alternatives as well as designer labels.

Based on Levi's current problem, we have come up with two different courses of action that Levi can take to help create differentiation and competitive advantage. One option would be to introduce "Personal Pair" which is a mass customization system which allows a person to be measured, and have a pair of jeans made to fit the exactly. This option will increase profits, and decrease competition because they are the only ones who would offer this. Another option would be to reposition the Levi's brand name in the U.S. so that consumers see the jeans as more trendy and modern, and not as the jeans their grandparents wore. Either of these recommendations will help the Levi's brand to stand out from its competitors.

Our recommendation to Levi Strauss is to begin a repositioning plan to boost up their brand name. They need to promote their brand name more in the U.S., which is where they are not a strong brad name. They should take the focus off of the durability and refocus marketing towards the younger generations who make up most of the jeans consumers. They should also form a strategic alliance to help off-set the financial costs of a mass marketing plan.

Table of Contents

1. Mission Statement.................................................................................................4

1.1 Problem Statement................................................................4

2. Background............................................................................................................4

3. External Analysis...................................................................................................6

3.1 Porter's Five Forces Analysis...................................................6

3.1.1 Barriers to Entry.........................................................6

3.1.2 Threat of Rivalry........................................................7

3.1.3 Threat of Substitutes...................................................7

3.1.4 Threat of Suppliers......................................................7

3.1.5 Threat of Buyers.........................................................8

3.2 Positioning Grid........................................................................................8

4. Internal Analysis...........................................................................10

4.1 VRIO Analysis..................................................................10

5. Courses of Action.........................................................................10

5.1 Trade offs........................................................................13

6. Recommendations to Management....................................................14

7. Competitive Advantage..................................................................15

8. Managerial Implications.................................................................18

9. Resources..................................................................................20

1. Mission Statement

Levi Strauss is committed to providing quality, innovation, and responsibility to the retail industry. "People love our clothes and trust our company. We will market and distribute the most widely worn apparel brands. Our products define quality, style, and function. We will clothe the world." (Levistrauss.com)

1.1 Problem Statement-

Levi's problem is that they have increased competition which is causing lower profits and decreasing market share. They need to differentiate in order to maintain their market share and continue to be profitable and maintain growth. Levi's needs to reposition their brand image and popularity within the United States.

2. Background

Levi Strauss was founded in 1853 and for over 150 years has been a company known for the quality and durability of its goods. Levi's is also known for its innovation and social responsibility. All of these things have made Levi's one of the worlds most widely recognized brands. Some say that Levi's brand is more widely recognized than Nike or even Coke (Barney, 2-55).

In 1853, Levi Strauss moved to San Francisco and started a wholesale dry goods business. It was not until 1873 that Levi Strauss and Jacob Davis, a tailor from Reno, NV, patented their idea of placing rivets on denim pants to strengthen and make them more durable. These pants were worn by miners in the California Gold Rush as well as factory workers and farmers.

In 1897, Levi Strauss established itself as a philanthropic company by creating 28 scholarships at the University of California, Berkeley. These scholarships are still in existence to day and help give many students the opportunity to earn a college degree.

During the San Francisco earthquake and fire of 1906, the Levi Strauss factory was completely destroyed. Unlike many of the surrounding businesses, Levi's rebuilt and grew even stronger. They continued to pay their employees during this time and they extended credit to some of their merchants to give them a chance to rebuild as well.

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