Demand Generation

Enterprise Competitiveness Council / Supply Chain Leadership Committee Meeting - Key Largo, FL

April 25 - 29, 2007

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Panel of Experts

Speakers– Kathie DiChirico, President, Visionary Strategies

– Richard Lusk, VP, Operations, Vanity Fair Intimates

– Jan Hilger, Dir of Product Development, HUGO BOSS

Committee Chair– Brett Mathes, VP, Engineering, Carhartt, Inc.

Moderator– Steven McLendon, VP, Sales, TradeCard, Inc.

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Session Overview

Introductory Comments

Kathie, Richard, and Jan’s Key Points

Summary

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Demand Generation Introduction

People Driven Process

No ONE right process for ALL

Collaboration minimizes risk

Do it with PASSION

Really Know Thy Customer!

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Market Orientation Kathie DiChirico

Proper Market Orientation Grows– Customer satisfaction & Loyalty

– Company Size

– Corporate Profitability

Customer Alignment Gives Right to Lead Market

Leverage Market Knowledge to Create Demand & Direction

“I skate to where the puck is going, not to where it is.”

Wayne Gretsky

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Indicators of Poor Understanding of Customers and Competition

Unfocused Competitive Position

We Have it Too--response

Excessive Customer Turnover

Market Share Instability

Inconsistent Profits

Accounting Maneuvers Drive Financial Results

Pressure for Short Term Profits

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1. CUSTOMER FOCUS: An obsession with understanding customer needs and delivering customer satisfaction.

2. COMPETITOR ORIENTATION: Continuous recognition of competitors’ sources of advantage, competitive position, and marketing strategies.

3. TEAM APPROACH: Cross-functional teams dedicated to developing and delivering customer solutions.

What the Best Do!

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Demand Generation:Take-A-Ways

Customer retention can lead to 50%+ growth in profitability with essentially no increase in market share of sales revenue required

Ensure your market knowledge creates a continuum spanning customer orientation, product positioning, presentation, distribution channels, product development, the product itself, and product/ customer service.

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Demand Generation Richard Lusk

Understanding, Creating & Seizing Consumer Demand

17 Brands, 3 Distinct Channels, North American and Europe– Department/Chain Stores

– Mass Merchants

– Specialty

Segmentation By Customers Needs and Emotional Attachments

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Consumer Segmentation

Enthusiasts Classics Basics

Premium Channels

Value Channels

Involvement High

High fashion brands, variety of styles

Medium

Function, beauty and high performance brands

Low

Basic comfort and styling

Functional Benefit

Shaping clothing, breast enhancement

Body and breast shaping Comfort, natural feel, support

Emotional Benefit

Feel good, self expression, use of brands as a badge

Feel secure, pretty and appropriate

Feel real, casual and appropriate

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Tools Richard Lusk

Planning Engine

PDM bill of material requirements

Production Plan

Customer Delivery

ERP Production System

Capacity Management

Material Availability

Inventory

Prioritized Demands

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Richard’s Take -A-Ways

Consumer-Centric Approach Drives Sustainable Growth

We Plan our Work, Work our Plan– Consumer Input

• Macro Trends, Segmentation Refinement, Focus Groups, Proto Validation

– Development Process• Innovative, True to Merchandising

Theme, Production Worthy

How else could they be successful selling something that most women do not like the buying experience?

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Demand Generation Jan Hilger

HUGO BOSS– Branding that defines a fashion

style and optimizes a lifestyle

– Creating Unforgettable Experiences

– The purchase is part of the prize

– Master the 3 A’s—Adaptability, Alignment, Agility

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Demand Generation Jan Hilger

BOSS Black Mens-/Womenswear

Sophisticated business looks, elegant eveningwear and casual leisure outfits for modern woman and men needs Meticulous workmanship, beyond short-lived trends.

.

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Demand Generation Jan Hilger

BOSS Green Menswear

For athletes and active outdoor performers - each and every collection piece optimally fulfills its function.

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Service the Brand Jan Hilger

Campaigns

Licensing Partnerships

Events– Fashion Shows in Global Capitals

– Formula One Racing

– Golf Sponsorships

– Supporting the Arts

– BOSS Shops

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The Prize

Purchase Supports the Prize

Each Purchase to be your Prize

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Common Elements

Really Know Thy Customer

Collaboration is Key—extend visibility, gain market knowledge, know what we don’t know

Adapt—go where they are going

Alignment—product to customer, channel, partners, experience

People—they’ll tell you what they want, just ask and listen

Passion—spurs success, just like a smile is contagious

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Summary

Collaborate to extend your reach and minimize risk

While technology is the shovel, People are the drivers

There’s No ONE right answer

Each sell is the results of multiple sells—brand to retail, brand to consumer thru retailer

Deloitte Study indicates that a 2% increase in conversion from shopper to buyer increases sales by 10%

Customer retention is the most effective path to dramatically increase profits

KNOW THY CUSTOMER

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Thank you Kathie, Richard, & Jan

Kathie DiChirico, President, Visionary StrategiesKdwdamarketing@aol.com

Richard Lusk, VP, Operations, Vanity Fair IntimatesRichard.Lusk@VFC.com

Jan Hilger, Dir of Product Development, HUGO BOSSJan_Hilger@hugoboss.com