Leo columbia univ jan 2014

The new pantyhose. With you for the long run.

l e o a

Alanna Lopes Souza | Amy Kwan | August du Pont

Lean LaunchPad

Team #5

The first branded, non-run pantyhose brand on the market aiming to make things simpler for women.

MBA 2015 MBA 2015 MBA 2015

Day 5Customer Interviews: 40

Total Running: 103Surveys: 66

• Pantyhose will last much longer and save consumers money in the long-term

• Feet will not slip in heels

• Machine washable

• Easy-to-store packaging

• Easy-to-wash laundry bag

• Physical: Web infrastructure, retail outlets

• Intellectual: Patents and brand copyrights

• Human Resources: Marketing and operations, development partner

• Financial: Seed capital

Business Model CanvasKey Partners

• Pantyhose manufacturers

• Wholesale channels

• Shipping companies

• Internet search engines

• Lawyers (patents)

Key Activities Value Propositions Customer Relationships Customer Segments

Key Resources

Cost Structure Revenue Streams

• Control of production, manufacturing

• Manage website, online orders, and distribution

• Branding strategy

• Marketing and promotion

• Product and packaging design

• Fixed: Product & packaging development, patent application, patent lawyer’s fees, infrastructure (website), accounting system

• Variable: Materials, manufacturing, packaging, distribution, marketing, operations

• Direct-to-Consumer revenues

• Wholesale to retailer revenues

• Subscription revenues

• Targeting busy, female business professionals

• Age range 20-30s

• Values quality over price (willing to pay a premium) but currently buys pantyhose at the drugstore for convenience

• Drive traffic to retail channels

Direct-to-Consumer

Wholesale Channels

Direct-to-Consumer

Wholesale Channels

• Home shopping networks

• Drug stores

• Department stores

• Get: Free products at professional conferences, free branded accessories (storage case and washing machine bag), coverage from fashion blogs, Search Engine Optimization

• Keep: Guarantee, product quality

• Grow: Word of mouth, increased color/design variety, subscription rewards

• Direct-to-consumer

• Established retail outlets

• Direct marketing

• Social media

• 1-year guarantee that pantyhose will not run

Channels

Day #1

• Target price $20






• Financial: Seed $

• Product development

• Partner with quality manufacturer

• Control of production, manufacturing



• Marketing / promotion

• Packaging




• Social media


Direct-to-Consumer










• Internet search engines



Key Resources




Direct-to-Consumer

• Targeting busy, female business professionals

• Employed females in the age range of 20-30s 25-55

• Values quality over price (willing to pay a premium) but currently buys pantyhose at the drugstore for convenience

Wholesale Channels


Wholesale Channels


• Drug stores

• Mass retailers (Target, Wal-Mart, Costco)

• Department stores

• Get: Professional conferences, trade shows, free branded accessories, fashion blogs, SEO, magazines



Channels


Day #2

• Target price $20 $15












• Packaging – patent




• Social media


Direct-to-Consumer












Key Resources




Direct-to-Consumer

• Employed females in the age range of 25-55 25-40

• Values quality over price (willing to pay a premium)

• Sometimes reads blogs

• Tech savvy

Wholesale Channels


Wholesale Channels



• Department stores .com department store sites

• Get: Professional conferences, trade shows, free branded accessories, fashion blogs, SEO, magazines



Channels


Day #3

• Target price $15









• Branding strategy (leos)


• Packaging – patent


• Established retailers


• Social media and blogs

• 1-year Guaranteed that pantyhose will not run satisfaction

Direct-to-Consumer

• Pantyhose will last longer and save consumers money in the long-term




• Packaging doubles as easy-to-wash laundry bag







Key Resources




Direct-to-Consumer

• Employed females in the age range of 25-40 (employed professionals and graduate students)

• Values quality over price (willing to pay a small premium)


• Tech savvy

Wholesale Channels


Wholesale Channels



• .com department store sites

• Get: conferences, trade shows, free branded accessories, fashion blogs, SEO, magazines, graduate schools

• Keep: Guarantee, product quality, easy & painless shipping & return (free)

• Grow: Word of mouth, more color/design variety, add a kids/toddlers line (for dance & normal wear)

Channels


Day #4

• Price $15 $20, 200% markup

• ~$5 cost = $15 profit

• ~75% gross margin



• Intellectual: Patents Trademarks and brand copyrights









• Direct sales force



• Guaranteed

Direct-to-Consumer

• Eliminate the main pain points women have with pantyhose








Key Resources




Direct-to-Consumer

• Females in the age range of 25-40 (employed professionals and graduate students)



• Tech savvy

Wholesale Channels


Wholesale Channels

• Mass retailers (Target, Wal-Mart)

• .com department store sites


• Get: conferences, trade shows, free branded accessories, fashion blogs, SEO, magazines, graduate schools

• Keep: Guarantee, product quality, shipping & return (free), loyalty program

• Grow: Word of mouth, more color/design variety, add a kids/toddlers line (for dance & normal wear), plus size line

Channels


• Price of $11.75

• ~$5 cost = $6.75 per pair


Day #5

X X

X

Key Learnings

Messaging is key, “nice to have”

features aren’t.

Women need to know HOW and

WHY.

Save the retail channels for later.

Build on an emotional

experience.

1

2

3

4

Customers and CPG experts

• Focus on core value prop: non-run• Non-slip feature removed• Storage box not valued


• Educate through channels: brand values, easy care

• Trademark slogan and quality standard - LeoKnit™

Distributors and retail outlet experts / entrepreneurs


• Focus on direct web sales first• .com retailers and mass retailers are

part of growth

• Add personalized messaging and loyalty program

• Target Working women and students (ages 25-40)

How did we find out?What? Implications?

Key Learnings – Customer ArchetypesAllison

Grad Student, 27Sonia

Lawyer, 32

Established or career-minded women Aged 25-40 Shops online, tech savvy Doesn’t really watch TV but uses social media Reads blogs, in step with the times Goes to coffee shops regularly Goes to occasional evening events

s

s

s

s

s

Key Learnings – Buying Behavior

• Frustration leads to cycle of last-minute buying before interviews or parties

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Current Future

• Purchasing only as needed (unplanned)

• Look for a low price tag because they don’t last

Planned purchase

Value purchase, trust

Strong experience leads to long-term relationship

Creating BRAND EQUITY is key.

• Get: Conferences, trade shows, blogs, SEO, magazines, graduate schools

• Keep: Guarantee, shipping & return (free), loyalty program

• Grow: Word of mouth, color/design variety, kids/toddlers line (dance & regular), plus size line

• Females in the age range of 25-40 (employed professionals and graduate students)



• Tech savvy

• Price $20

• ~$5 cost = $15 profit



• Physical: Web

• Intellectual: Trademarks and brand copyrights

• HR: Marketing and operations, development partner








• Direct sales force



• Guaranteed

• Eliminate the main pain points women have with pantyhose


Final Business Model CanvasKey Partners




Key Resources


• Fixed: Product & packaging development, infrastructure (website), accounting system


Channels

The Product

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• Communicate LeoKnit™ quality which will last longer and will not run

• Packaging• Personalization• New name “leos”

instead of pantyhose

With you for the long run.©

Build trust.

Provide an experience. Educate.

• Machine washable bag and instructions

• Experience with leoa is simple

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LeoKnit™

The Website

http://lopessouzaalanna.wix.com/leoa

Key features Simple design Educate consumers about our quality and care instructions Blog component and customer reviews to create sense of community

Distribution & Pricing

Online mail orders Free shipping and returns

Direct-to-Consumer Campus Sales Force

Pricing

Take orders directly from students On-site sales force during recruiting

season

Sale Price $20.00Manufacturing Cost $5.00

Profit per Pair $15.00

Gross Margin 75%

Get, Keep, Grow Strategy

GETSocial Media Internet / Press In Person

Viral Videos

what happens when your tights run (leoa)leoa

Blogs SEO Magazines

Graduate school direct sales force

Trade shows Professional

conferences


KEEP

l e o a REWARDS CARD

MON TUES WEDTHUR

SFRI

1st Pair 2nd Pair

3rd Pair 4th Pair 5th Pair

FREE!

Refer 2 friends, get 1 free pair!

Referral Referral

Experiential Purchase Loyalty Program

Personalized. Memorable. Educational.

Satisfaction guaranteed Free shipping Simple returns

Pair for every work day


GROWChannels Product People

Mass Retail

dotcom

New colors Designs Feature variety (control

top, non-control top, sandlefoot, reinforced toe, etc)

Toddlers line with non-slip grips

Kids line (dancers) Plus size line Targeted ads for people

who don’t wear pantyhose at all because they hate what’s out there

EconomicsSale Price $20.00Price to Retailer $11.75Manufacturing Cost $5.00

Markup 70%

Profit per Pair $6.75Gross Margin 57%

• Seek out retail partners (Target, Walmart) after initial sales

• Look into channels, product, and people expansion

• Talk to marketing industry experts

• Develop marketing strategy

• Develop website• Partner with manufacturer• Research quality

assurance methods / risks

Next Steps…

Medium Long TermImmediate

Stage 1 Stage 2 Stage 3

• YouTube ad campaign• Test non-slip grips on the

market, patent if successful

Appendix

Market Size

$1.5B

$471M

$334M

• 51.3M employed females ages 18-54

• Averaging $30 spent on pantyhose per year

• IBISWorld “Hosiery Mills in the US, November 2013”

• Discount stores & mass merchandisers

• Department stores• Online

Sources: IBISWorld; “Hosiery Mills in the US, November 2013”U.S. Census Bureau, Current Population Survey, Annual Social and Economic Supplement, 2011.

Total Addressable Market

Served Available Market

Target Market

l e o aFast

Fashion Stores

Premium Stores

Online Brands

Department Store

Brands

Drug Store Brands

Brand Awareness

Affordability

Quality

Storage / Washing

Non-Slip Feature /

Competition

Competition

Retail / Online Stores

Drug Stores

Department Stores

Who They Are What They’re Missing

Affordability• High price points

Reliability• Can’t always find

basic print / colors

Convenience• Stores are not

designed for shoppers on the go

Quality• Products are typically

cheap and likely won’t last longer than their initial use

Efficiency• Despite the low price

tag, multiple purchases add up

Simplicity• Product offering can

be overwhelming• Wide range in both

quality and price

Convenience• Concentrated in

shopping districts• Few are located in

financial districts

Leo columbia univ jan 2014

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