Levi Strauss Case Study
Levi Strauss Case Study
Levi Strauss was using the marketing strategy where national marketing managers did not have much responsibility. The company benefitted because it was the sole jeans manufacturer for a long time. People had developed confidence in Levi Strauss and they did not find any basis to change the strategy. This played to the company’s disadvantage because the managers were ideally in contact with the local customers. The national managers were familiar with the needs of the people within their areas of jurisdiction. The purchasing power of the prospective customers was essential for the people to the company to consider if the company had to continue registering profits. Standard marketing strategy was used to cover all the customers regardless of their geographical locations. Variations among markets were not of essence to Levi Strauss in early 2000s. The strategy appeared to work for decades because the company did not face a lot of competition from similar institutions. The strategy also worked because Levi Strauss had already dominated the market with their product selling in more than one hundred countries worldwide. The strategy stopped working when other institutions emerged that had different marketing strategies. The new manufacturing institutions offered alternative fashion trends that Levis Strauss had refused to introduce. The company also sold its products at extremely high prices while the other companies were relatively cheaper. These are the main critical reasons why the strategy used by Levi stopped working.
The current strategy employed by Levi Strauss managed to protect the company from difficult moments. The managers employed this strategy at the right time because Levi Strauss was on its way to degeneration. The strategy was able to capitalize on the needs of its customers around the word. The national managers were given more responsibilities to decide what their target customers needed. Concentration was turned to areas where the cost of production was not expensive. Closing the areas where the market was expensive meant that the cost of the jeans would go down. The management made extremely imperative changes to rescue the company from difficulties. Production in America was making the jeans expensive in every market and the closure made the prices different across the markets. The jeans were customized to suit different categories of customers. In Asia, shorter legs were considered with South Africans getting jeans that had allowances at the back. Japan on the other hand got tight-fitting jeans of black color. In Europe, Levis Strauss concentrated on cool fit jeans.
The immediate benefit to the company’s new strategy included recording profits after a long time of making loss. Any company takes pride in ensuring that her customers are pleased with the goods and services offered. The new strategy is not beneficial to the company alone the customers’ needs are also met. The changes introduced to different nations were aimed at ensuring that the unique needs of the customers were met. One of the challenges facing Levis Strauss is how to win back the confidence enjoyed in the past, in areas such as America. Other similar companies had dominated the market before Levis Strauss introduced the new strategy.
Ultimately, the story of Levis Strauss is a good example on how companies can benefit from globalization by remaining relevant to every market. Globalization has made it possible for companies to venture in international regions. Levis Strauss story clearly shows how different nations can have unique needs. Failure to consider isolate these needs can render a company obsolete.