12/21/2015

CASE 5: Giordano:
Positioning for
International
Expansion
Service Marketing Prof Faye J. Kao

HIROMU OKADA RA6047358

LIZA WIDJAJA
RA6047405
NGUYEN THI LIEN (LUCY)
RA6047413
KEZIA SARAH ABEDNEGO
RA6047439
ROBERT YANG RA7031106

1. Describe and evaluate Giordanos product, business and corporate strategies

Products
Giordano has 5 company brands that are Giordano, Giordano Concepts, Giordano Ladies (A
line smart blouses, dress pants, and skirts targeted to executive women and office ladies,
dressier), Giordano Junior (A Giordano launched for kids), and Blue Star Exchange (A
casual clothing line for the price conscious customer). At the first time, Giordano sold mens
casual apparel but when Lai realize that an increasing number of women increase, Giordano
made unisex apparel.
Business and Corporate Strategies
Business level strategies is an integrated and coordinated set of commitments and actions the
firm uses to gain a competitive advantage by exploiting core competencies in specific
product markets. Business level strategy indicates the choices the firm has made about how it
intends to compete in individual product markets. Giordanos business level strategy is Focus
Strategy. Focus strategy is an integrated set of actions taken to produce goods or services that
serve the needs of a particular competitive segment. It is proved by Giordanos limiting its
expansion and focusing on one specific area. Giordano has their own target market and focus
to sell at that area. Simplicity and focus of Giordano reflected in the way Giordano
merchandised its good. Giordano featured no more than 100 variants of 16 core items,
whereas its other competitor has more than 200 until 300 items. Giordano targeted a
particular buyer for each brand. Giordano not only has different segment of a product line but
also has a different geographic market. For example Giordano in Taiwan has coat while
Giordano in Indonesia just have jacket since the weather in those 2 countries are different.
Giordano success run its business strategy since they effectively serve a segment whose
unique needs are so special that others competitors cannot fulfill their special needs.
Corporate Strategy
Corporate level strategy that used by Giordano is Global Strategy. Global Strategy is an
international strategy in which a firms home office determines the strategies business units
are to use in each country or region. It is proofed by Giordano launched several promotions
such as World without Strangers in order to raise funds for the Tsunami victims and
Strength, Explore, Listen, Believe, Imagine, and Accept. These promotional marketing
implemented not only in Indonesian but also in other Asian Country which Giordano

merchandized its business. In the organization itself Giordano implements decentralized

management. Also about employment it is depend on HR each country
In the overall, Giordano lain on some critical aspects such as high quality service, focus on
developing employees talent, reaching out customer, exploring newer markets to expand in
the global area. Giordano positioning itself as a retailer of a value-for-money merchandise.
Giordano has willingness to try new and conventional ways of doing business. The firm was
open to experiment and introduce new product ranges and design customized products for
various segments but still focus on the specific area

2. Describe and evaluate Giordanos current positioning strategy. Should Giordano

reposition itself against its competitors in its current and new markets, and should it
have different positioning strategies for different geographic markets?

Giordano was established in Hong Kong in 1980. The first retail store opened in Hong
Kong next year. Giordano expand their market by distributing Giordano merchandise in
Taiwan by joint venture. In 1985, Giordano established first retail outlet in Singapore.
However, the growth of sales was not effectively. Because of the problem, Giordano changed
their positioning strategy to sold exclusively mens casual clothes. After that, Jimmy Lai who
is chairman of Giordano, realized that actually number of female customers increased.
According to the consumer change, he decided that Giordano repositioned the chain as a
retailer of value-for-money merchandise, which selling discounted casual unisex clothes to
the goal of maximizing sales rather than margins. The repositioning strategy was successful.
It increased in net profits. Giordanos positioning strategy has strength of flexibility to fit
consumer demand at each time. The business philosophy came from Lai. He managed to try
new unconventional way of playing business. At the same time, he always learned and fixed
from past errors. Also, he has belief that empowerment might minimize filature in his
business.
According to this previous positioning strategy of Giordano, they should keep the
positioning strategy of value for consumer money because it has been actually succeed. The
high consumer service also has attracted customers. Additionally, Giordanos learning and
fixing strategy and positioning was important in the past to success. These their strategies

must be keeping. However, to expand their business, they also need exam possible
positioning strategies for new market because different countries or markets have different
cultures. The differences affect their business.

3. What are Giordanos key success factors and sources of competitive advantage? Are its
competitive advantages sustainable, and how would they develop in the future?
Giordano has four levels of service performance in Leader level which are the key success
factors and sources of competitive advantages. Furthermore it is defined on these table:
Marketing Function
Roles

of Giordano has innovative leader in chosen segments, and known for

marketing skills (Giordano has a lot of marketing programs). It is proved

Marketing

by Giordano has several brands related for its targeted segment. When
Giordano want to launch its new product, its uses concept testing,
observation, and use of lead customers as inputs to new-product
development. Giordano are willing to innovate their business
Competitive

Giordano focuses on the service. In 1998 Giordano started to campaign

Appeal

with the yellow badges bearing the words Giordano Means Service. Since
companys name synonymous with service excellence, its ability to delight
customers raises expectations to levels that competitors cant meet.
Giordano received a lot of awards related to the service

Customer

Giordano selected target market with clear segment. Its develop 5 different

Profile

brands to target different target market. Individuals are selected and

retained based on their future values of the firm, including their potential
for new service opportunities and their ability to stimulate innovation.

Service

Giordano service quality always meet or exceeds customer expectations.

Quality

Giordano launches service philosophy we welcome unlimited try-ons; we

exchanges-no questions asked; and we serve with smile. Because of these
philosophy, Giordano capable to raise customers expectations to new
levels and improves continuously.
Operations Function

Role

of Giordano has a willingness to try new and unconventional ways of doing

Operations

business and to learn from past error. Giordano recognized for innovation,
focus, and excellence

Service

Delivery is a seamless process organized around the customer. In Giordano

Delivery

ladies, the employees were trained to know their name and their past
purchase. Employees know whom they are serving. Giordano keep speedy
operations This kept the product development cycle short. This helped in
disengaging from manufacturing and focus on retailing

Backstage

Giordano closely integrated with front-stage delivery, even when

operations

geographically far apart, understand how own role relates to overall

process of serving external customers. Giordano has inventory control so
that they can communicate to customer with know customers purchase
pattern

Productivity

Giordano

actively

seeks

customer

involvement

in

productivity

improvement. It is proved when Giordano is Singapore asked the customer

what they thought would be the fairest price to charge for a pair of jeans
and charged each customer the price they were willing to pay. It
Introduction
of

Giordano work with Information Technology to facilitate the inventory

new management and demand forecasting. The advantages of using IT are

technology

customers purchase patterns can be understood and the information was

disseminated to production facilities in real time.
Human Resource Function

Role

Of Giordano invested heavily in employee training and has been recognized

Human

for its commitment to training and developing staff. Giordano evaluate

Resource

their employees by mystery guest. In order to keep maintain the best

service, Giordano has strict selection procedures to make sure the
candidates selected matched the desired employee

Workforce

Giordano believes that empowerment would minimize mistake-that if

every employee was allowed to contribute and participate, mistake could
be minimized. Giordano empowered line managers and at the same time
encourage fast and close communication and coordination.

Frontline

Giordano emphasize on the transfer learning to the store. It such a mentors,

Management workers to enhance career growth.

Our group stated that these factor can be sustain since Giordano make them as valuable
(value of their trained staff, their excellence service), rare, costly to imitate (for example
those information technology used by Inventory System) and no substitutable capabilities. To
develop in the future, Giordano can adjust with current development so that there will be no
core rigidities. Since Giordano implemented decentralized management it would be easier to
maintain their competitive advantage. Giordano has a willingness to innovate with its product
so that Giordano follows the trend without leave its focus.
4. Could Giordano transfer its key success factors to new markets as it expanded both in
Asia and the other parts of the world?
Basically, economical goods with good quality are the essential spirit when Giordano manage
its business in Asia and others parts of the world. However, it needs to develop different
strategies for different regions or countries. There are some reasons, first, the intercultural
difference need to be considered. Different areas have different perspective, some region is
not accept lower price, because it mean cheap and lower quality. Secondly, demography is
different, which segmentation and position need be settled. Is it developing country? Teenage
and adult, who can be afford to spend money, it need to do the detailed investigation for the
regions first. Third, need to develop the strategy according to a detailed understanding of
consumer tastes and preferences for fabrics, color and advertising for the right target customer.
Again the way to solve it is by investigation. Forth , if there is already strong competition on
site already ? How about the other brand and his reputation , if yes , Giordano is rivalry which
his competitor will choice to fight back with aggressive . Fifth , new technology can be
duplicated in the other country , for example , IT system , even in some areas or country they
are not used to use the IT system to collect information , its advantage that Giordano had and
what they win the marketing .
To sum up, the principle of former successful factor need to keep implemented, and then
survey the new marketing first, then make the strategies accordingly. Its better to make
clearly analysis e.g. 5 force analysis , 7Ps to position and make business strategy .

5. How do you think Giordano had/would have to adapt its marketing and operations
strategies and tactics when entering and penetrating your country?
Giordano would have to take the following the marketing and operations strategies and
tactics when entering and penetrating to adapt in my country:
Following the marketing theory of 4Ps includes four factors: product, price, place, and
promotion. They are the tools to meet the customers demands.
For its products stratergy: In Vietnam, Giordanos product suitable for people with average
and high income level. These products are divided into many segments. For example: Kids and
Adults, male and female, office fashion and street fashion. In conclusion, products have to pay
attention to difference between areas culture, weather and climate as same as the similaries and
exploitation that one. However, Giordano must concentrate on customers perception and their
hobbies,
For its price strategy, Global brand can generate brand umbrella, which speed up new
product introductions and increase the effectiveness and efficiency of advertising. As there are
common value-for-money needs, the price to value concept had been testified to be successful.
Mid-priced products make people feel good and good looking design of the products make
people look great, which is exactly its mission. In conclusion, Giordano should consistency in
service and merchandise quality,
For its promotions, Giordano should organizes some events for customers. For example:
special sale-off, distribute voucher for customers, . In addition, Giordanos marketing and
operations need to be addressed separately.
For its place strategy, Giordano is located at big city where is developing area and populous.
Furthermore, Giordano should put their stores at mall, big supermarket where reserved for
people have average and high income level,

6. What general lessons can be learned from Giordano for other major clothing retailers
in your countries?
There are several general lessons that we can learn from Giordano which are:
Giordano has target for every segment (wide range of customer). Their segment is not
just based on gender and age, but also from income (Giordano, Giordano Concepts,

Giordano Ladies, Giordano Junior, and Blue Star Exchange). The wide range of
Giordanos customer target can make this company reach a higher market share.
Giordano has a good sense to place their store. Giordanos store placed in a good location
such as in retail shopping district with good foot traffic. So we have to know first which
area in our country that has high foot traffic, so the chance to attract the customer will
increase. Good place also can increase brand awareness.
Good attitude from the leader. Leader has enormous influence for the employee. If the
leader has a good attitude, the employee can make him as a role model too. A willingness
to try new and unconventional ways of doing business and to learn from past errors was
part of management philosophy and become an integral part of Giordanos culture.
Giordano can appreciate their employee well. The appreciated and acceptance feeling can
make an exceptional service from the employee. Giordano considered frontline workers
its customer-service heroes.
Awareness about the importance of modification in training employees for different
country. This company really aware with managing its Human Resources. Giordano
know the recruitment, selection, and training local employee need modification for each
country because of the culture, education, and technology differentiation.
The good attitude from the leader, well trained (stringent selection procedures to
selecting the candidates

training workshop

service orientation and employees

character test) and appreciated employee, increases Giordanos quality of service until
this company honored by numerous service award.
Make an innovative product and service (being innovative in responding to customers
need).
Understanding the customer well such as know the preferences of the customer, selling
goods in the low price, and make customer feel convenient.
Simplicity and focus product. Merchandising a wide range of products made it difficult to
react quickly to market changes.
Know the competitor, from their product, place, price, advertising until their target
market. So, Giordano can select their own target market and differentiate the product and
service with their competitor.