1

Brazil Distribution Strategy(2008-2011)

Ana Luz – march 2008

2

Brazil Distribution Strategy(2008-2011)

Ana Luz – march 2008

• Distribution Strategy - Where• Distribution Strategy - How• Consumer Profile – Who• Opportunities• Market Trends• Product Search• Bibliography

3

Brazil Distribution StrategyWhere & How

Ana Luz – march 2008

Brazil Distribution StrategyWhere

-Focus at top markets SP, RJ, SC, PR, RS – main malls and street doors

- Channel Segmentation: boutiques/concept stores & premium doors.

- Doors Criteria: presentation, location, mix of brands, gender, age

- Consumer Segmentation: - Surf, - Skate, - Fashion, - Urban & lifestyle - Specialized jewelry & watch - Premium accessories.- On-line store

- Product Segmentation: selective product mix oriented by channel and consumers segmentation, price points and product line.

- High level of brand exposition & unique brand experience at retail & premium exposition

Brazil Distribution StrategyHow• Sales

Phase 1 - 2 sales reps + 1 sales trainee (2008)Phase 2 – 3 Reps + 1 sales assistant. (2010)

•Marketing

- Technical & sales training support.

Marketing & Communications Support: connection with surf skate events + music, art & entertainment, design.

- Catalogs/Videos- Print Advertising- Internet - www/nixonnow/brazil/storelocator/retailer. - Sales Promotion - Launch Events - Retail partnership- premium expositor and corners.

- PR connects Celebrities & Opinion Leaders & Sports personalities.

Doors Plan Draft2008 – 20 doors 2009 – 30 doors2010 – 40 doors2011 – 50 doors

Brazil Distribution StrategyMacro Markets and Key Cities (% Rev. b/Market)

São Paulo: 30%56 SIS, 3 NS

Curitiba: 3,9%14 SIS, 1NS

Brasilia: 1,3%11 SIS

Salvador: 0,9%10 SIS

Rio de Janeiro: 8%21 SIS, 2 NS

Porto Alegre: 5%17 SIS, 1 NS

Belo Horizonte: 1,7%5 SIS, 1 NS

Recife: 1,0%3 SIS

Fortaleza: 0,5%

SAO + RIO = 40% of revenues

Brazil Distribution Strategy

Consumer Profile

Surf Fashion/Urban LifestyleSkate Jewerly/Accessories

111 1Boutiques

Premium

Best

Core

Boutiques Boutiques

Premium

Best

Core

Premium

Best

Core

Premium

Best

Core

Boutiques

2 2 2 2

Snow – Campos de Jordao* - SPSummer Hot Spots – Brazil – Ilhabela, Trancoso, Jurere int.

8

Brazil Distribution StrategyTo:

Ana Luz – march 2008

Brazil Distribution StrategyJewerly/Accessories

Focus distribution on main malls and select jewerly well stablished retailers as

partners to cover regions of class A consumers that search for status &

luxury.

SP - Shop Iguatemi, Shop Cidade Jardim, Shop Villa Lobos, Shop Morumbi, Oscar

Freire St, Daslu, etc RJ – Barra Shop, Shop Gavea, Rio Sul,

Desing Leblon etc

Store Profile: Boutiques/Concept Ex: Dryzun, Amsterdan Sauer, H.Stern,

Natan, Tabacco & Gift Shops, Duty Free/Paid.

5-10 doors

1Premium

Boutiques

2

Brazil Distribution StrategyUrban

1 Boutiques

Core

Premium

Best

Core

2Boutiques

Premium

Focus distribution on undergorund stores at street & galleries as partners to cover regions of consumers for stylish street &

urban attitude.

SP – Galeria Ouro Fino e Galeria do Rock

RJ – Galeria River

Store Profile: Underground stores Ex: Ichiban, ADD, NYC, Junks, etc

Need credit approval

5- 10 doors

Brazil Distribution StrategySurf

Focus distribution on the best surf Boutiques and also

Billabong`s for surf premium consumers & opinion leaders.

2 – select Billagong best retailers – ex: Star Point, Tench Beach, Overboard, Central Surf

for core surf consumers.

5-10 doors

Competitors Surf Brands http://www.tactics.com/brands/surf

1Premium

Concept Stores

2

Brazil Distribution StrategySkate

1 - Identify Skate Boutiques – Ex: Maze for premium consumers.

2 – select Element premium retailers 10 to achieve core

consumers

5-10doors

Competitors Skate Brands http://www.tactics.com/brands/skate

1Premium

Concept Stores

2

Brazil Distribution StrategyFashion

1 – Exclusive Launches for Multibrand Boutiques – Docdog

Sneakers, Ichiban, Surface to Air, Hospedaria Carioca, Reserva, Daslu,

Pelu.

2 - Identify premium multibrand fashion specialized for men and

women outside SP/RJ.

5-20 doors

1Premium

Boutiques

2

14

Brazil Distribution StrategyOpportunities

Ana Luz – march 2008

Brazil Distribution StrategyOpportunities

• Be info-comercial - Surf & Skate & Fashion & Urban + entertainement - new concept stores at SP and RJ - Billabong, Element, Custom, Nixon, VZ with unique brand experience through retail premium exposition.

• Be in the Hot Spots in the City/Street: Malls - Iguatemi Shop Mall, Shop Morumbi (Billabong), Shop Villa Lobos, Shop Cidade Jardim & Street Spots: Oscar Freire, V.Nova Conceicao, Vila Madalena, Baixo Jardins.

• Be in the Hot Spots at the Beach – Jurere Internacional, SC, Trancoso BA, Maresias, Parati, Ilha Bela, SP, Buzios RJ, Pipa, CE etc

• Be Local: partnership with local designers and sports personalities for colab product development and sponsorships.

• Relax, Ride and Enjoy: Hotels and Natural Resorts, Surf & Skate Travelers Guide, Skate & Surf Camps, bike boutiques.

Brazil Distribution StrategyMarket Trends

Luxury Watch Brands Get Sporty Luxury Meets Lifestyle

An Active Choice Retro Watches

17

Brazil Distribution StrategyMarket Trends

Ana Luz – march 2008

• Luxury Watch Brands Get Sporty

Effective motivational merchandise reflects the lifestyle of the recipient, so it makes sense that today's active, health-conscious workforce is gaining interest in sporty watches. Sports styles should be included in any well-rounded selection of motivational timepieces. These watches fall into two general categories, quartz or mechanical, says James Feldman, president of Chicago–based James Feldman Associates. Quartz watches work electronically, while mechanical timepieces rely on springs and gears to keep time. Mechanical sports watches cost far more than their quartz counterparts. Sporty quartz watches have seen a boost in popularity, thanks to rapidly dropping prices and increasing functionality. "Inexpensive sports watches are so much better today than they were a few years ago," Feldman explains. "As prices have come down, functionalities have gone up. [Merchandisers offer] running watches that can track your pace and heart rate, diving watches that tell how deep you are and how long you've been under, and climbing watches with altimeters."While inexpensive quartz sports watches have mass appeal, sporty mechanical timepieces have enduring meaning, Feldman says. "Traditionally, the sign of success at a car dealership has been the Rolex Submariner. It's a big, heavy, mechanical watch that costs between $4,000 and $6,000 in silver, and up to $20,000 in gold."

Brazil Distribution StrategyMarket Trends

• Luxury Meets Lifestyle As their popularity among consumers grow, sportier wristwatch styles are migrating into luxury brands, and experts say that an upscale watch can have an sporty vibe without relying on a rubber strap or an LCD display. As Allyson Krichman, senior director of fulfillment at Rymax in Pinebrook, N.J., says, "It's not about sporty meaning a rubber watch. We think of a sporty timepiece as having a little bit of an edge to it." Mainly seen in men's watches, multiple-dial designs give luxury watches a sportier feel, Krichman says. "And stainless steel bracelets definitely create sportier looks, both for women's and men's watches."Multiple functions can also give wristwatches a sportier look, says Joe Zanone Jr., senior vice president at Mahwah, N.J.–based Movado Group Inc., and the extra functions can have special utilities for activities on incentive trips. "For instance, a compass watch is a great gift when companies take their incentive qualifiers out on hiking trips or send them on teambuilding activities like scavenger hunts," he says. "For beach incentives, diving watches are an obvious choice."Zanone points out that sporty styles can be found on timepieces at all price points, including the very high end. "For ladies, we can do something a little more sporty but we dress it up with diamonds," he says. "The new SE Movado Collection for ladies comes with a diamond bezel."Whether an active competitor, or just an active benchwarmer, adding several sporty watch options to your merchandise selection is a great way to get more participants in the game. Here are eight great timepieces that will have of your performers racing to the finish line.

Brazil Distribution StrategyMarket Trends

• An Active Choice As a reward, sports watches have a special status value, advertising the wearer's active lifestyle. "If you're wearing a dive watch, people will think you're a scuba diver. If you're wearing a watch with an altimeter, they'll think you're a mountain climber," Feldman says. Companies like the fact that sporty timepieces encourage and reward physical activity and good health. Arnold Light, founder of The Light Group, a White Plains, N.Y.– based incentive house, managed a corporate sales meeting for a health care company where 200 sports watches were presented to attendees. The timepieces had moderate monetary value, as they cost Light's client just $125 each, but the sporty wristwatches conveyed an encouraging signal to participants. "By giving out sports watches to attendees, the management was actually encouraging the sales force to be active," says Light. "The watches became a motivation to become healthy and stay healthy, and attendees appreciated the appropriately themed timepieces. People liked the watches a lot."

December 25, 2006By Ben Chapman, PotentialsOriginally published in Potentials magazine, December 2006

Brazil Distribution StrategyMarket Trends

21

Brazil Distribution StrategyProduct Search

Ana Luz – march 2008

1. Seiko Sportura Analog Digital This wristwatch has a creative design that employs an analog display and a digital LCD display on a single face. The hour, minute and second hands tell time, and the LCD behind the hands has chronograph functions. Water-resistant to 100 meters.$595; www.seikousa.com

2. Timex Ironman Triathlon Bodylink The Timex Ironman Triathlon Bodylink is a sports watch system that's designed for serious athletic use. This water-resistant, rubber watch features an easy-to-read LCD display that indicates the wearer's heart rate, speed, distance and altitude and has chronograph functions.$300; www.timex.com

3. Movado SE This timepiece exemplifies the way sports styles are taking hold in luxury watch designs. The SE stands for Sports Edition, and this Movado has been refined with a sleek, new, sporty silhouette and aerodynamic contours. Crafted from stainless steel, this elegant watch features a black museum dial.$1,995; www.movadoincentives.com

4. Bulova Marine Star The Bulova Marine Star has a clean, efficient design that makes it a classic choice. This chronograph features a blue sun-ray dial with 24-karat-gold, ion-plated accents, and a stainless-steel case and bracelet. Water-resistant to 100 meters.$399; www.bulovaspecialmarkets.com

Brazil Distribution StrategyProduct Search

• 5. Tag Heuer Aquaracer Tag Heuer's Aquaracer is a classy option for the water sports enthusiast. It provides the functionality and accuracy that all water sports demand and is water-resistant to 300 meters. Features include split-time chronograph functions and a double bezel. $1,095; www.tourneaucorporatesales.com

6. Citizen Eco-Drive Calibre 2100 The Eco-Drive Calibre 2100 features a power reserve meter, a non-reflective crystal, engraved screw-back case and a screw-down crown. Water-resistant to 200 meters, this sports watch never needs a battery. It's powered by any kind of light, and runs and recharges continuously. $500; www.citizenwatch.com

7. Breitling Avenger Seawolf This divers watch from Breitling is water-resistant to 10,000 feet. While it's unlikely your recipient would ever take it that deep, it's a cool technological feat worth bragging about. This watch is made of titanium.$2,575; www.tourneaucorporatesales.com

8. Tourneau Safari Sport 1950 Flyer Big Date This striking wristwatch, with its supersized, 42-millimeter face, takes the dial frenzy to a new level. The stainless steel case houses a traditional three-hand dial, a date window and three chronograph dials. The multiple dials give it a retro feel, like something Hemingway would wear when he chased lions in Africa.$995; www.tourneaucorporatesales.com

Bibliography

http://www.joshspear.com/item/boteggapaul-smith-skateboard/http://www.youtube.com/watch?v=vw6XFnpReSc&eurl=http://www.simonperry.org/worlds-largest-skate-ramp/http://www.luxurysurf.com/http://images.google.com.br/images?um=1&hl=pt-BR&rls=SNYF%2CSNYF%3A2004-47%2CSNYF%3Aen&q=surf+luxuryhttp://www.tropicsurf.net/index.php?option=com_site_engine&catid=1http://www.billabong.comhttp://www.hstern.com.br/site/home/default.asphttp://ca.nixonnow.comhttp://www.goldcoast.stays.com.au/24417http://www.dryzun.com.br/http://www.batelsurfcamp.com/Alojamento.htmhttp://www.iguatemisaopaulo.com.br/http://www.starpoint.com.br/http://www.elementskateboards.com/http://www.shoppingvilla-lobos.com.br/http://www.morumbishopping.com.br/home/http://www.starpoint.com.br/default.asphttp://www.thehundreds.com/http://premiumskatedesigns.co.nz/http://www.theretroworld.com/http://www.retro-watches.co.uk/watchesforsalea-e.html#Casiohttp://www.swisswatchboutique.com/2007/03/more_and_more_w.htmlhttp://www.digitaldrops.com.br/drops/2007/09/um_relogio_perfeito_para_djs.htmlhttp://www.stamps.eu/website_EN_%20052005/httpdocs/index_en.htm