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WorksheetsYear 10 Humanities - Online Sales
Total questions: 13
Worksheet time: 26mins
What is your name?
Who is JD Sports and why should we focus on them?
JD Sports has doubled revenues (profit) while competitors’ sales such as Footlocker and Rebel Sports flatline.
JD Sport’s operating profit rockets by 61% last year and is leaving other retailers in the dust.
Meanwhile, rival companies such as Foot Locker reported a 6% fall in EBITDA for the previous year, and Rebel Sports called in auditors after its pre-tax profits last year fell by 9.6%.
EBITDA - Earnings before interest, taxes, depreciation, and amortization
Auditors – a person who is brought in by a company who is going through financial difficulty.
JD Sports is increasing their profits.
JD Sports is a serious competitor.
How do we know that JD Sports is successful?
JD Sports has called in an auditor.
Other companies such as Foot Locker made 61% profit.
JD Sports increased their profits by 61% when other brands lost profit.
What makes JD Sports so successful, even during tough economic times?
A representative of one clothing label that works closely with JD says:
“It is the good mix of brands, opening in the right markets and providing a great experience in store. Plus its social media is really good. JD makes sure it is involved and advertises in all the right events.”
Good selection of brands.
Great locations and in store experience.
Great social media and event advertisements.
All of the above.
What strategy do they use that is successful?
JD’s focus on understanding its customers to garner this “positive reaction” has been crucial.
As the clothing brand representative puts it: “Its strategy of segmenting the customer is designed to not just keep pushing a generic message to their customers – it’s very individual messaging. It drills down and targets the right message for different genders, ages, mums, dads and teens at the right time. It’s nowhere near perfect, but it’s streets ahead of everyone else.”
They have one strategy that they apply to everything.
Rather than having a generic advertising strategy, it alters its messages for different genders, ages, and people in society.
Another label that works with JD says:
“There is a simple formula that I think they got right. They learned earlier than anyone else to communicate with the young lad or girl who is switched on to trends. They do a lot of business with the big sports brands that are the powerhouse of the business, and they achieved that by curating exclusives.”
What is another strategy they have used?
You can select more than one answer.
They identify what the young demographic want.
They work with well-loved brands to create one of a kind and exclusive products.
They create their own trend.
They only work with big sports brands.
Luxury Brands:
Luxury retailers are becoming increasingly desperate to connect with a generation of digital savvy buyers.
Moreover, the market is saturated with social media influencers (SMI) and v-loggers, so luxury brands turn to media targeting by using different solutions that secure them great media coverage and good PR.
This has resulted in luxury brands ‘gifting’ their products to social media influencers or partaking in online competitions.
Have you seen this on your Instagram feeds?
Yes
No
Strategy 1: 'Gifting' as Advertising
A brand or product is forced on the followers and it fills their feed.
They do this by 'gifting' their new products to a range of Social Media Influencers (SMI) who have to post photos of them in their products with their positive reviews.
They all post on the same day and post a series of photos and stories with the product.
What is this strategy?
A brand posts photos of models wearing their products.
A brand pays a person to wear their products.
A brand uploads video shoots and magazine shoots.
A brand gives their products for free to a SMI in exchange for posts and stories.
What are the strengths to this strategy?
The brand is active on social media.
The product or brand appears fashionable and in demand online.
The brand shows off how people have already bought their products.
What are the weaknesses of this strategy?
You can select more than one answer.
The brand or product may no longer seem exclusive to consumers.
The brand earns a lot of money from sales.
SMI could lose followers for being dishonest.
Strategy 2: Instagram Loop Giveaways
A loop giveaway is where a group of social media influencers and a business get together to create a competition, most popularly on Instagram. Each influencer contributes to the prize pot (putting money in for the items), creating a bigger, more valuable and more attractive prize package for the lucky winner.
When the competition launches, each participating business will post an image advertising the giveaway with the entry instructions in the comments.
Followers are asked to like the post, follow all the people that they follow and then leave a comment.
Got it!
I still don't get it.
Why do people use this strategy?
For the influencer, they are getting a large number of new followers VERY quickly.
For the business, they are getting their product advertised.
Influencers get new followers quickly.
Businesses get their products advertised online.
What are the weaknesses to this strategy?
But as with all “get rich quick” schemes, there are pitfalls for both the social media influencer and the brand.
Examples:
•Often, the ‘winner’ never receives their prize.
•SMI lose all of their new followers as soon as the giveaway ends. The SMI have paid for a giveaway but not earned any long time followers in return.
•A luxury brand will no longer be viewed as ‘luxury’ or exclusive.
Winner never receives their prize.
SMI lose followers after the competition ends.
A brand will lose its 'luxury' status.
