CHAPTER II

INTRODUCTION

Business Concept

Stylized Co. is a sole proprietorship business that identifies itself as a unique

and adventurous clothes and accessories brand. It offers a wide variety of choices
for modern, urban men and women. The business uses a flexible and resilient
business and marketing strategy to cater the public’s changing demands in a short
span of time as well as to promote different innovations in the current fashion
industry. It aims to unite modern life with traditional culture.
Its main line is Lokal-Ito, a clothes and accessories line that adopts
indigenous, native culture to modern, contemporary fashion, allowing people from
all genders to enjoy and express themselves in a course that proudly expresses their
native roots and country. It makes use of the cloth of the traditional Filipino
malong—a long, wrap-around tubular garment with multi-colored geometric
designs— innovates it and mixes it with modern-world fashion for a wide range of
product line with a twist of a mosquito repellent formula.

Business Model Canvas

Key Partners
Our key partners include malong fabric manufacturers/sellers, tailoring
shops, stylists, models, website developers and shipping companies. Our key
suppliers are stores selling affordable malong textiles most especially in well-known
stores in Mindanao or other local stores here in Cebu. We can acquire raw materials
such as malong cloth, sewing materials/equipment/tools as well as design ideas,
marketing impact and ease in shipment from our partners. The key activities they
perform are apparel manufacturing/ merchandising, needlework, product designing
& advertising, and exports.

1
Key Activities

We need to be knowledgeable enough with the different clothing trends as

well as our original filipino art. We should also choose the right type of fabric and
the ingredients used for our mosquito repellent formula in order to attain our
environmental objective. The products’ quality and selling price must also be
considered as well as our marketing strategies wherein one is to create an inviting
and interactive web page especially in social media and control over the orders and
distribution. Lastly, product development could be attained through conducting
periodical researches or asking casual feedbacks from the customers.

Key Resources

We need cotton-made malong fabrics, sewing materials/tools/equipment,

essential oils, and human resources such as dressmakers, fashion designers, web
developers, researchers and sales team. Strong customer relations is also important
and much easier to achieve with our other distribution channel which is through
direct selling.

Value Propositions

We value creating a high quality clothing line that integrates the traditional
filipino art with modern trends with the use of malong textiles at an affordable
price. It helps give attention to our original Filipino aesthetics and preserve the
environment with the number of issues it has with the common type of textile used
nowadays. Moreover, we aim to be able to produce clothes and other accessories
made from malong and incorporating an anti-mosquito product line. There is always
a need for clothing as it is one of our basic necessities and people nowadays are very
conscious when it comes to fashion trends. Our minimum viable product would
probably be the anti-mosquito clothing product line since we can incorporate a lot
of design ideas with it and many are looking for ways to get rid of mosquito and
other insects.

2
Customer Relationships
The internet and social media sites are very cheap yet powerful in terms of
expanding our market. Having exclusive promos also entices the customers to buy
and await for more. Working with social influencers such as fashion bloggers and
social media influencers could also help. Lastly, we could make use of reward cards
where customers get redeemable points in each purchase.

Channels
Through producer to consumer channel, producers can directly sell their
products to consumers which is accessible for both. The business can directly
manage the marketing activities and has full control over distribution and uses. For
most companies they use online or website channels and social media channels as
many customers today would buy and order clothes online and the other one is
buying directly to the store. But the leading channel for other companies is online
channels because on some customers, they prefer on buying clothes online instead
of going directly to the store and consumers are not limited in choosing on various
types of clothes online. Our business both uses these channels on either buying
online using websites or social media or directly go to the store in where the
consumers has the freedom to choose on how they want to buy their clothes.

Customer Segments
To know who our customers are, we need to segment them through the use
of demographic segmentation wherein we can identify the customers personal
information such as age, gender, socio-economic, occupation and the like.
Behavioural segmentation wherein we divide the market into smaller homogeneous
groups based on customer buying behavior on the basis of buying patterns of
customers like usage frequency, brand loyalty, benefits needed, during any occasion
and etc. Psychographic segmentation where we can narrow the market more by
identifying the customers based on their different personality traits, values,
attitudes, interests, and lifestyle. By using these three types of segmentation we can
now identify our important customers in terms of clothing businesses.

3
Cost Structure
Majority of the costs in our business will be variable costs. Variable costs for
Lokal-Ito include raw materials/resources used, equipment/machinery, and the
utility bills for the usage and maintenance of these hardwares, labor of workers,
tailors, and dressmakers, and the packaging/shipping fee used to deliver the
products to the customers. We classified these as variable costs because they are
incurred when producing a product, therefore sensitive to changes in demand and
supply and cannot be easily predicted. As a result, our business model will greatly
benefit from economies of scope where there will be a reduction of costs when our
business invests in multiple markets or a larger scope of operations. The average
cost of production is therefore expected to decrease as we increase the number of
goods it produces. Furthermore, our business benefits from economies of scope
through the product diversification of Lokal-Ito because, the different products have
common processes or share the use of some resource. Hence, spending on
marketing the products or distribution channels lessen per unit if the products
require similar marketing efforts or use the same distribution channel.

Revenue Streams
Most customers are looking for high quality clothing at an affordable price.
There are also some who opt in buying those expensive ones for prestige. In the case
of the amount they’re willing to spend, it would also differ from each customer’s
perspective towards the type of fabric used. The amount would usually range from
Php 100 - Php 300 for low-middle class, Php 300 - Php 2000 for high-middle class,
and Php 2000 above for high class. The model used in this kind of business is a
transaction-based revenue wherein sales of the goods are usually one-time
customer payment.

4
Vision
To create and promote a brand that truly recognizes the creative minds and
works of Filipinos, provide growth opportunities for the business and achieve its
goal to revolutionize the modern clothing industry and would help the
environmental issues occuring on the country enabling the business to innovate and
surpass its limits.

Mission
Stylized Co. is committed in building the best brand offering and creating
fashionable products at affordable prices that help inspire the world and captivate
both customers and employees to the innovation and promotion of unique Filipino
product designs and cater customer preferences to further exceed expectations and
is dedicated to environmental improvements that foster a sustainable future.

Goals and Core Values

“Lokal-Ito offers everyday products made from indigenous materials,
catering to everyone’s needs in the most innovative and creative way, all while
aiming to protect Mother Nature.”
● Environmental Sustainability
● Innovativeness
● Creativity
● Cultural Preservation

Objectives

Financial Objectives
Lokal-Ito aims to increase its revenue each year, maximizing profits and
minimizing costs of sales for production. It aims to ensure its financial stability and
maintain profitability, striking a balance between revenue and expenses.

5
Customer Objectives
Lokal-Ito aims to give the best quality it could offer in the most affordable
prices. It also aims to have a broad product offering, giving its customers the best
reliable goods with ranged product lines. It aims to increase in its market share, and
partner with customers to provide solutions to their needs.

Internal Objectives
Lokal-Ito aims to provide products that make use of modern styles and
acquire new customers from its innovative offerings. It aims to make a unique line
of products such as an anti-mosquito product line that stand out among its
competitors, grow the percentage of products, and improve research and
development.

Customer Service Objectives

Lokal-Ito aims to provide exemplary customer objectives that enhance
customer experience and draw in new customers, invest in customer management,
improve customer satisfaction that satisfies their needs and wants.

Operational Objectives
Lokal-Ito aims to effectively produce its product, maximizing the number of
products produced and reducing operational costs and time taken for production.

Growth Objectives
Lokal-Ito aims to grow its technical and analytical skills, and create a
performance-focused culture in the work environment. It also aims to create high-
performing teams determined on improving and developing the business and its
products.

Social Objectives
Lokal-Ito aims to provide a product that revolutionizes how Filipinos sees
their culture with modern culture. It aims to share indigenous culture and beauty
towards the rest of the country and give higher employment rates for indigenous
people while still getting in touch with their roots.

6
Environmental Objectives
Lokal-Ito aims to develop an environmentally conscious-culture in the work
environment, using as less environmentally-damaging materials as possible,
avoiding synthetic fibers and plastic during production and would also help
contribute in decreasing the dengue epidemic in the country.

Key Result Areas

1. Customer Satisfaction
2. Establishing Cultural Significance
3. Generate Sustainable Revenues
4. Produce Environmentally Friendly Products
5. Establish Trust Among Consumers

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 CHAPTER III
ENVIRONMENTAL ANALYSIS

This chapter presents the business’ external environment or outside factors

that affect its flow of operations starting from the macro environment particularly
the socio-cultural, technological, economic, ecological, political, legal, and ethical
environment to the degree of competition.

Socio-cultural Environment

Major social changes have occurred in the last ten years that have affected
the demand for fashion products. While the millennial generation is now the main
target of the fashion marketers, its preferences are very different from the previous
generations. A number of changes on the sociocultural level have affected how
people shop and make their shopping decisions or which brands they prefer to shop
from. Millenials do not just want convenience but also low prices and great quality
(Pratap, 2017). The demographic makeup of global population has changed a lot
during the recent decade. This has affected several important changes leaving
marketing with several options and opportunities as well as faced with new
challenges. Now, businesses are catering to different needs where they do not just
have to push sales, but to attract and engage customers (Reyhle, 2016). The fashion
industry has felt the push and the rise of fast fashion is a proof. Fast fashion brands
like Zara, and Bershka have brought affordable but good quality fashion to the
customers. High class fashion is no more the privilege of upper end consumers
because, it has been made affordable using technology and new marketing
techniques. Even if the quality of fabric is not as great as the luxury brands, it is good
enough and in terms of style and design, these fast fashion brands are hardly behind
(Richards, 2018). The result is consumers are flocking to fast fashion avenues. Not
just taste but other things have also changed about the consumers. They have grown
more discerning and make decisions based on information which they can acquire
easily from several resources online. They rely on feedback and not on advertising
or marketing campaigns (Pratap, 2017). Social media and digital media have

8
drastically changed how people consume content, especially in the fashion industry.
People are no longer picking up magazines as often as they have in the past. Today,
content is consumed online and people are not only reading content, but they are
offering their feedback through comments and social media (Banerjee, 2015). In
light of these changes the fashion retail environment has grown challenging.
A major socio-cultural factor influencing businesses and business decisions is
changing consumer preferences that are rooted from their culture, beliefs, and
lifestyle. What was popular and fashionable 20 years ago may not be popular today
or 10 years down the road. Consumer preferences towards affordable but good
quality fashion provides opportunity to Stylized Co. This clothing line aims to
provide products for customer satisfaction in a lower and reasonable price than its
competitors. With social media being the greatest influencer of consumer buying
decision, this is another opportunity for the business because it plans to set-up a
website for its clothing line, making it accessible and easier for consumers to know
more about its products. Furthermore, Stylized Co. targets consumers that are teens,
young adults, and millennials, and making sure that it offers not just convenience,
but also low prices and great quality.

Technological Environment

With new technology rising up almost every year, it is getting more and more
difficult for companies to catch up with the fast changes. In the international
clothing industry, last 2017 Columbia produced its OutDry Ex Eco Shell, an
environmentally friendly waterproof jacket that utilizes recycled plastic bottles;
DYNE has made use of NFC (Near Field Communication) technology to make
stitchless garments (Rakestraw, 2018). ONU has also launched a tech-infused
apparel that includes biodegradable collagen fabrics, stretch reflective panels, and
garments made from “ArLyte”, a stretch fabric made with jade particles that cools
when it’s worn (Rakestraw, 2017). Turkish Cypriot Hussein Chalayan has also made
a name in 2013 that showcases a haute-couture short dress that transforms into a

9
long, elegant dress (Balbo, 2013). In it the Philippines, Filipino fashion designers are
starting to use indigenous textiles like abaca to manufacture clothes lines and
accessory lines. Accessories designer Adante Leyesa creates handbags and necklaces
using bamboo, pineapple fibre, and local precious stones (León, 2014). In terms of
technology and high-tech fabrics, Research and development is largely informal and
undeveloped in the Philippines and is still in the development process (del Prado &
Rosellon, 2017), its fashion designers and entrepreneurs focusing on the local and
indigenous industry development and making environmentally friendly accessories
and clothes.
The rise of new technology and discoveries have made it so that
opportunities to make better and more efficient clothes and textiles that adapt to
the current environment and the needs of the general public are easier and more
sustainable. Leaders of the field give way for new innovations for aspiring
developers to follow. The popularity of more technological-friendly and
environmentally-friendly clothing has made it so that the general public has learned
to embrace it, allowing any innovators to market couture products without the need
for introducing a whole new concept to the public, but rather to introduce a whole
new innovation that the public would need.
The abundance of the use of new technology has also opened the possibility
of basic clothes to become more expensive to sell and more so costly to produce. It
puts into the public’s that these types of clothing are exclusive to a niche group
rather than to everyone. Furthermore, it creates an idea of “too much” for just casual
clothing for anyone to enjoy (Tigert, Ring, & King, 1976).

10
Economic Environment

Textile and Clothing industries are considered to be very essential especially

to a number of countries around the world. It contributes a lot to the country’s
economy in terms of trade, GDP or Gross Domestic Product as well as employment
rate. It employs people across occupations—including fashion designers, computer
programmers, lawyers, accountants, copywriters, social media directors, and project
managers. It offers many opportunities for export diversification and expansion of
manufactured exports for low-income countries that can exploit their labour cost
advantages and fill emerging niches and meet buyer demands (Keane & Velde,
2008). However, such economic factors affecting the textile and clothing industry
can be positive or negative. Positive effects arise most especially during economic
boom periods since people have more disposable income, thus, they usually buy
more clothing which increases the sales for clothing manufacturers, wholesalers as
well as retailers. On the other hand, negative effects arise during economic
recessions since people are having a hard time coping up with the general
slowdown of economic activity and they have less disposable income, thus, there is a
decrease in sales for clothing entities and retailers are stuck with large amounts of
inventory.
In the Philippines, fashion has become one of the many things that helped
flourish the country’s economy. According to a report by the Philippine Statistics
Authority (PSA), total spending on clothing and footwear alone amounted to
P36.358 billion in 2015. In 2014, when GDP slowed to 6.3 percent, total spending on
clothing and footwear hit P32.985 billion. The spending allotted to clothing and
footwear in the country posted a 10.2-percent growth rate for 2015, the PSA data
showed. This trend is seen to increase over time, as long as the population grows
and spending continues (Cu, 2016). Furthermore, the combination of the country’s
spending population and the steady source of cash especially from abroad has made
the Philippines an attractive market and as Filipino artists and designers made
waves in the global market, it was not too long before the country lured foreign

11
brands. The Philippines is already on its way towards a thriving fashion industry
most especially if its potentials could be utilized efficiently and effectively.

Ecological Environment

Dengue, including dengue fever and dengue haemorrhagic fever, is the most
rapidly spreading mosquito-borne viral disease and an increasing public health
problem globally . During the past 50 years, the incidence of dengue has increased
by 30 fold, parallel with the increasing geographic expansion from urban to rural
areas (Pham, Doan, Phan, Minh, 2011).
People from various industries should start contributing on helping decrease the
dengue epidemic. Thus, this lead the business to make malong based clothes that are
being incorporated with a mosquito repellent patch that would help decrease
dengue.
Another issue occurring today is climate change and global warming might
pose serious challenges to fashion companies in the future, especially within
developing countries (OECD, 2009). People should start saving the environment to
lessen the risk of climate change and global warming or else individuals would face
consequences in the future. Thus, all companies needs to be particularly aware of
environmental risks but for some companies would actively use carbon footprint
which are being demanded by stakeholders to reduce their carbon footprint and
incorporate environmental practices alongside their whole supply chain (Johansson,
2010; Pookulangara & Shephard, 2013). In which does not help reduce the risks on
ecological problems. Stlylized Co. helps the ecological environment because the
business uses eco-friendly materials that does not harm the environment and are
also dedicated to help decrease ecological problems.
Therefore, should be more careful with the kind of fabric used as certain
chemicals from the fabric can oppose a threat for both the business and
environment which are closely interlinked. It also includes the risks for human
health. Growing non-organic cotton is cheaper than organic cotton and requires a

12
big amount of chemicals, water and pesticides, which harm human health and have
a significant, long-lasting impact on the environment (Déri, 2013). Therefore, the
business should be aware on choosing fabrics to avoid risks for the environment.

Political Environment

Typically, governments have a great deal of power over businesses and many
times, there is not much that businesses can do about it. One of the opportunities a
fashion industry can have is the Philippine Design Competitiveness Law, or
Republic Act (RA) 10557. This was approved in 2013 by the 15th Congress, RA
10557 that aims to promote and strengthen Filipino design. The law understands
there is a huge talent pool of designers here in the Philippines that can be cultivated
and introduced not only in the local market but also in the international playing
field. The Act also pushes for the patronage of local products, the protection of
intellectual property with regard to design, the promotion for collaboration among
local design stakeholders and more. The Act also reiterates the role of the Design
Center of the Philippines, in which it shall support and foster the creativity and
talent of Filipinos who wish to pursue the retail or fashion design course,
respectively (Cu, 2016). This Law encourages the Filipinos to get out of their shell
and reveal their creativeness and uniqueness.
Republic Act No. 7394 also known as Consumer Acts of the Philippines it is
the policy that protect the interests of the consumer, promote his general welfare
and to establish standards of conduct for business and industry. Owner of Stylized
Co. must not only be concerned to our business but also to the consumers that
purchases our product. But also consider their needs and wants about the product
especially fashion since fashion also reflects to one identity and character, thus they
must also create products that will possibly be suitable to their taste. The rights of
employees must be abided by any businesses to ensure overall productivity because
employees are the one who lessens the burden in every business that is why in
return businesses must give importance to them. The continuous increase of tax

13
may also affect the business since the raw materials that they are acquiring will also
increase its price which will be difficult especially if they don’t have enough capital.
Inflation rate will also be the possible threat of the business because as the prices of
goods is rising, the purchasing power of the consumers are falling. Which is not
good for a start-up business. Thus, the business must be aware of the political
factors that could possibly be a threat or opportunity.

Legal Environment

Legal challenges abound in the fashion retail industry. Ethics and compliance
are important focus areas for the big brands and they are working actively in this
direction. The fashion industry is a large employer and apart from the labor laws
and consumer laws, other common laws applicable in business also apply on it.
Environmental laws have also grown tough and needed to be complied with. A
number of legal macro-environmental factors affect small businesses in the clothing
industry. The industry has repeatedly been affected by issues such as workers'
rights and child labor laws. A famous fashion line, Urban Outfitters, has already been
penalized for attempting to make employees work for free, so repeating this might
result in a run-in with the law. They have also been accused of stealing designs from
Etsy sellers. This sort of malpractice can easily kill a business in the world’s current
social/legal state (Bush, 2016). In another business, laws have been introduced to
prevent companies like Tesco from changing product prices without informing
customers. Recently, there has been a crackdown on misinformation in product
discounting, changing prices without notices, and demanding payments from
suppliers from the said business (Frue, 2018). This negative publicity may impact a
small clothing retailers' sales and profits.
The fashion industry must follow similar legal rules and regulations like any
other business. To stay legal, they follow laws regarding the consumers, laborers,
environment, and the like. They must maintain workers rights as stated in the Labor
Code of the Philippines. The Labor Code sets the rules for hiring and firing of private
employees; the conditions of work including maximum work hours and overtime;

14
employee benefits; and the guidelines in the organization and membership in labor
unions as well as in collective bargaining. In line with this, Stylized Co. gives value to
their workers especially the ones who belong to foundations that are working in the
marginalized communities. It supports their own special product line, which is the
malong and provides the workers with recognition, and benefits. Aside from that,
Stylized Co. must also see to it that their workers receive proper payment and
treatment as stated in the Labor Code. It is also needed that Stylized Co. should not
only focus on the workers rights, but also to its consumers, following the Consumer
Act of the Philippines.

Ethical Environment

Numerous organizations and local brands in the Philippines nowadays are

giving rise to the local textile and garment industry. Philippine Textile Research
Institute (PTRI), part of the Department of Science and Technology of the
Philippines, is searching to find a way to connect raw material production and
apparel. According to PTRI Director Celia Elumba, their goal is to add value into
products and add more jobs for Filipinos (Bueno, 2018). Local Filipino designers are
also starting to create partnerships with NGOs where their profits are donated and
used for community development. More and more designers are putting in their
profits to charity, and creating meaningful employment directed towards helping
the environment and the community. Womenswear designer Tipay Caintic, designed
a knitwear collection that were inspired by the Typhoon Haiyan (Yolanda) that
devastated Tacloban (León, 2014).
Filipinos have started to develop more and more ways to provide meaningful
employment, have programs directed towards poverty eradication, and
environmental conservation. Entrepreneurs are now focusing their efforts towards
the betterment and the conservation of Filipino culture in the fashion department.
This is an opportunity for fashion industries to create more sustainable products
that are directed towards the local community and the development for more
innovative products that would help advance the current status quo of Filipinos.

15
 The amount of organizations popping up and suddenly making use of local,
indigenous materials will pose as a threat to start-up industries because of the
increase in competition for both new and established companies. It will also put up
a question on whether or not a business is truly cares about the public’s well-being
or if the business is merely jumping the bandwagon for more financial gain.

Identification and Assessment of Competitors

The table on the next page shows the four identified direct and indirect
competitors of the Stylized Co. which is the Kultura Filipino, Herman and Co.
Clothing, OFF!, and MoskiShield. Details such as their main customer segments,
product attributes and features, marketing practices, market performance, their
product strengths, weaknesses, and main value propositions. These details are
studied to determine what makes their product attractive to customers and
potential buyers.

16
 Table 1.1. Competitor Analysis

Questi Competitor’s Products

ons for
Compe Kultura Herman OFF Moski
titor Filipino and Co. Shield
Analys Clothing
is

A. Main Customer Segment

1) Profile It’s the usual go-to of The heritage clothing OFF! offers various MoskiShield’s
balikbayans who are brings together types of lotions and products are the first
looking who are indigenous weaves and sprays usually for one to be approved
looking for pasalubong native textile particularly mosquito and insect by FDA. They cater
or where you’re likely from South Mindanao. repellents. OFF also their products such
to find Their goal is to keep offer their products to as mosquito
what to wear to a people weaving. They everyone where in repellent patch spray
Filipiniana-themed hope to keep unique kids, young adults, and sani spray to the
occasion. But more weaves of the indigenous adults, and even for children because
than that, Kultura Filipino alive by the elderly can use the they are prominent
celebrates the best of incorporating them with product. to mosquitoes and
the Philippines when it everyday wear available germs.
comes to fashion, not just to the local
accessories, and market but even globally.
souvenirs. They also
have a line that
supports communities
in the Philippines
called Crafts for a cause

17
2) Traits and It highlights uniquely It showcases textiles and It indicates and aims It emphasizes or aim
characteristics Filipino artistry and artisan products to help the health of to protect the health
craftsmanship ranging specifically from the people to prevent of everyone
from home products, indigenous tribes in the from diseases and who’s prone to
fashion designs, and Philippines. Moreover, it viruses. mosquito bite,
filipino souvenirs made emphasizes the especially now that
from indigenous Mindanao art and design there are mosquitoes
materials that in textiles and garment who bring dengue
showcases the styles. virus with them.
Philippine heritage and
contemporary culture.

3) Buying behavior Kultura Filipino used Herman and Co Clothing OFF! Often makes its MoskiShield used
expensive indigenous brings forth weavers own ingredients but plants like lemon
materials which from the South when they buy eucalyptus and other
requires the Mindanao and even if products, they would known plants that
consumers to conduct their products are buy complicated repel mosquitoes so
an extensive decision expensive and high products which can this business
making comparing the quality consumers still also help benefit the involved more in the
other alternative stores purchase their products lives of people where well-being of the
that also provide the over and over again this in they would make children. Thus, the
same products and leads to a impulsive research and consumer tends to
which one is suitable decision buying behavior experiment on their have an extensive
for the consumer. wherein consumers ingredients to be used. decision making
don’t have any plans on They would also have since they need to
buying things but ended an extensive decisions research the
up doing so. It is because on the product. ingredients of the
the products that product first because
Herman and Co clothing it might harm their
that are offering are children or the one
unique and pleasant to who will use it. The

18
 the eyes. product needs to be
identified and
verified as well as the
company to avoid
health issues.

4) Usage pattern Kultura Filipino offers Herman and Co. Clothing OFF! Offers a variety MoskiShield offers
a wide variety of integrates indigenous of products with its different uses of
merchandise ranging weaves,and textiles into own purposes where mosquito repellents
from home accessories, modern clothing. in they would make a from patch to spray.
souvenirs, fashion, Customers who loves product that is They also have a
delicacies, and crafts and has the eye for specifically for that sani-spray short for
for a cause. Customers unique fashion and purpose or problem. sanitizer spray. This
spruce up their homes cultural heritage Customers would is mainly used for
with Kultura Filipino’s purchase Herman and often find their children in the
handcrafted quality Co’s products for products that would Philippines which is
accessories, and exude everyday wear. People have its specific use. mostly the target of
elegance during who live a constantly mosquitoes. Since in
Filipino themed curious lifestyle, curious the Philippines
occasions with their about their roots with a dengue virus is
Barong Tagalog and discerning style while prominent there
Filipiniana apparel, patronizing artisanal which is also the
and finely crafted work are the main users main reason why this
jewelry. Moreover, of the clothing line kind of product exist.
customers also products. Their product
purchase pasalubongs protects the welfare
like souvenir items, of the children from
shirts, and delicacies the germs and
for a remembrance mosquitoes.
from the Philippines.

19
5) Image of product

20
6) Major motivation Kultura Filipino strives Herman and Co. Clothing OFF! Aims to help all MoskiShield aims to
to put Filipino focuses on showcasing people especially for give an effective and
craftsmanship and indigenous textiles and families to protect safe mosquito
artistry to a highlight, fabrics from the many them from any repellent that is both
reflecting Filipino indigenous tribes of the diseases, illnesses, and fun and easy to use
heritage and using Philippines into clothing also for viruses. for kids.
indigenous materials to (“Herman & Co.
bring their products to Clothing”, 2018)
life (“Kultura”, 2018).

B. Product Attributes and Features

1) Materials used Piña cloth, silk, Abaca, neoprene fabric, Water, p-Menthane-3, Lemon eucalyptus
cocoon, abaca, palm, cracked crepe fabric, 8-Diol, cetyl alcohol, plant
pandan, seagrass or linen fabric fragrance, other
tikog reeds chemical compounds

2) Sites available Website Websites Website Websit

s named named s named es
kulturafi wearherma off.com/ named
lipino.co n.com and en and moskis
m and also also hield.c
also through through om
through social social
social media medias
media accounts such as
such as such as Faceboo
Faceboo Facebook k and
k and and Instagra
Instagra Instagram m.
m

21
3) Colors Kultura features its Herman & Co. Clothing OFF! Uses different MoskiShields
signature neutral, dark has distinct, colorfully vibrant colors to emphasizes the
and white colors in its patterned products due indicate what kind of vibrant green color
fashion products, to its use of indigenous use is the product like which represents
reminiscent to the fabric made from for example green for nature. It also plays
warm soil and rough different Philippine deep woods. Orange with other pleasing
barks on trees in the tribes. for family and kids. colors such
Philippines. as yellow.
Occasionally, a splash
of yellow, blue, and
red colors that are also
prominent in the
Philippine flag.

22
4) Designs, models Kultura Filipino Herman and Co’s designs OFF! Uses designs that MoskiShield
and variations highlights uniquely portray narratives of are well-thought to for promotes the health
Filipino artistry and history, culture and the purpose awareness against
craftsmanship. It tradition that are woven, on emphasizing its mosquitoes that will
offers a wide range of stitched and sewn into use. They also have attack at any time,
product line made amazing creations, many models with place and moment. It
from indigenous adding more depth to the different and specific provides products
materials that best substance of fashion. purposes. that are targeted to
reflect Philippine Each of the designs has a children just like how
tradition, heritage and story about origins, roots, the mosquitos target
contemporary culture. family, hometown and them. Since children
Their products are culture of the Mindanao are prone to dengue
enriched with the people all rolled into a virus they are the
perfect ambiance of vision born of love and ones being
Filipino materials such passion of the designer. emphasized in their
as pearl, capiz, wood, print ads or their
laminated accent video ads itself. The
pieces, indigenous designs of their
weaves, local fabrics, products is uniquely
and traditional details made for children
from cultural only such as the
communities with patches’ designs are
modern styling and animals but adults
contemporary can still use them.
silhouettes.

23
5) Functionality Kultura’s fashion Herma & Co. Clothing OFF! Not only make It offers Mosquito
items are mostly offers fashion items that mosquitoes repellents repellent patch is a
catered towards more have a mix of cultural insects, ticks, gnats 100% natural
formal occasions like influences and modern and other bugs they mosquito repellent
Buwan Ng Wika; their influences. It provides also ensure it is safe and also contains
items include the clothes for casual and and effective way to 100% natural oils
Barong and Maria formal wear, of course prevent insect-borne that will only be
Clara that are worn made from indigenous diseases. And help attach to the clothes
mostly during formal textiles. lessen the people who last up to 24 hours
events or themed would die from and is made up of
events. For their mosquito-borne Lemon eucalyptus oil
accessories, most of diseases every year. that is a known plant
the products are that repel
aimed towards mosquitoes. They
tourists, featuring also have a mosquito
characteristics like the repellent spray that
distinct figures of the comes in 30 ml to 60
Philippine islands or ml spray bottles and
an important a sani spray table
landmark of the and seat sanitizer
Philippines. Some comes in 20mL
products also have handy spray bottle,
Catholic or Christian so anybody can
symbols in them. easily carry it to
Kultura also sells sanitize & disinfect
home accessories that tables at eateries,
are made and weaved school tables, office
from local, indigenous tables, Toilet seats,
materials that Public seats, baby
functions as furniture changing table and
or containers in a more
homespace.

24
 C. Marketing Practices

1) Marketing Manufacturer to Manufacturer to Manufacturer to Manufacturer to

channels Retailer to Customer Customer Customer customer

2) Advertising and Kultura Filipino Herman and Co. Clothing OFF advertises their MoskiShield
promotions advertises their advertise their products products through advertises their
products through through websites named websites named products through
websites named wearherman.com and off.com/en and also their website named
kulturafilipino.com also through social media through social media moskishield.com and
and also through accounts such as such as Facebook and through social media
social media such as Facebook and Instagram. Instagram. OFF! Uses such as Facebook.
Facebook and Herman and Co. personal coupons and And also those
Instagram. Kultura personally sells: clothes, free printable people who already
Filipino personally accessories, and “banig” coupons. became an advocate
sells fashion clothes, called Baluy that have to their product and
accessories, souvenirs, traditional designs made keep on posting on
and crafts that are all by Filipinos. different social media
design and made accounts such as
traditionally. twitter, instagram
and blogs. Their
products can be
bought in Mercury
Drug and through
online shopping at
Lazada.

25
3) Communication “Uniquely Filipino” “A heritage brand “Make the most of our “Always Natural,
message (“Kultura”, 2018) showcasing textiles and time outside .” Always Effective”.
artisan products from the
indigenous tribes in the
Philippines.
categories.” (“Herman &
Co. Clothing”, 2018)

4) Prices and selling The company’s price The company’s price The company’s price The company’s price
terms ranges from Php 500 ranges from Php 3,000 to ranges from Php 30 to ranges from Php 100
to Php 8,000 on all of Php 7,000 on all of their Php 500 on all of their to Php 500 on all of
their products. Since products. Since they sell products. And sell their products. They
they also have an online, shipping fees are their products often sell their products
online shop, shipping applied upon the through pharmacies. from pharmacies,
fees are applied upon purchase of products. and online where
the purchase of shipping fees are
products. applied upon the
purchase of products.

5) Places and Kultura Filipino has Herman and Co still OFF! Sell their MoskiShield operates
outlets sold spread throughout the hasn’t established an products often on their business online
whole country. There outlet, and only has an pharmacies and also and still hasn’t
are over 14 Kultura online store for business. from grocery stores. opened its business
Filipino outlets in physical stores or
nationwide, and 13 outlets.
are located in SM
Malls.

6) Market reach Kultura’s market Herman & Co. Clothing’s OFF! Markets MoskiShield’s market
includes local and market reach is mostly in everyone and from is focused on the
international the local area of the every places. local area of the
(tourists), targeting Philippines; most buyers Philippines and most
the locals with its are young adults who are of its customers are

26
 traditional, formal interested in a more already mothers who
Filipino crafts; its couture form of fashion, are concerned for
international brand some of their customers their children’s
mostly focused on are people who attend welfare.
tourist items like events that require
accessories or novelty traditional clothing.
t-shirts and souvenirs.

Best performing Accessories, Formal Clothing OFF lotion mosquito Mosquito repellent
models, variations wear, and bags repellent patch, spray and
sanitizer spray.

E. Strengths of The company has a The product designs are It has various MoskiShield’
Competitor’s wide selection of very intricate and they products with product is the first
Products products catering incorporate a mix of different uses which one to be approved
different ages and bright and vivid colors in can help consumers by the FDA as safe
genders. It is also their styles which are knowing its specific and effective
marketed in a lot of very captivating uses. mosquito repellent.
branches of SM malls especially to young
around the country. women.

F. Weaknesses of Most products are Products are only Too many product The effectiveness of
Competitor’s made for formal marketed to women, lines which makes the the mosquito
Products occasions and the product line or selections consumer confused in repellent only last up
price range is very are limited, and the price which to buy and also to 24 hours.
high. range is very high. the repellent doesn’t
last for too long .

27
G. Main Value Kultura highlights To highlight the unique To enable individuals The product is both
Proposition of uniquely Filipino and authentic weaves of and especially families fun and easy to use
Competitor’s artistry and indigenous people by to have fun outside because since it
Products craftsmanship. integrating their fabrics without worrying. targets children their
Expansive range of into everyday wear. patches are designed
range of products as animals, or
made on indigenous anything eye
materials that best catching.
reflect Philippine
heritage and
contemporary culture
under three main
categories: Fashion,
Home and Souvenirs.

28
Positioning Map

Grid 1. Quality versus Price Positioning of Competitors.

Grid 2. Sales Volume versus Main Value Proposition.

29
 CHAPTER IV
MARKETING ASPECT OF THE STUDY

A. Overview
Objectives of Marketing Research
To determine the factors that may affect the buying preference or buying
behavior of the target market to the newly developed products of Lokal-Ito of
Stylized Co. Specifically, the marketing study will explore on the following areas:

1. To describe the demographic profiles of the target market.

1.1 Age
1.2 Gender
1.3 Educational Attainment
1.4 Monthly Income/Allowance
1.5 Religion

2. To know which of the following factors really affect the buying preference of
the target market:
2.1 Product Quality
2.1.1 Durability
2.1.2 Reliability
2.1.3 Appearance
2.1.4 Design
2.1.5 Packaging
2.2 Price/Affordability
2.3 Place

3. To have an idea which among the promotional mix is the most effective in
enticing the target market to buy the product:
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 3.1 Traditional
3.1.1 Print Media
3.1.2 TV
3.1.3 Radio
3.2 Non-Traditional
3.2.1 Person
3.2.2 Event
3.3 Digital
3.3.1 Social Media

Target Market Determination

The business aims to primarily target every Filipino people in the age range
13 years old and above. The target customers are categorized into three customer
segments: teens, young adults and adults.

Teens
This customer segment comprises of teenagers ranging from 13 to 17 years
old. This age group has a tendency to follow anything which appears “hip” or “in”.
They are quick to relate and follow what appears to be trendy and fashionable.
Marketing on this segment involves the usage of magazines, television and social
media since this customer segment read and go through fashion magazines, watch
many fashion related television shows and follow various influencers on social
media. They look up to each and every idol they see on television or the internet as
well as in their favorite fashion magazines.

Young adults
This customer segment comprises of young adults ranging from 18 to 25
years old. Marketing on this segment would involve the utilization of social media
and internet websites more compared to the other segments since most young

31
adults frequently uses modern technologies and interacts regularly with the
internet. This customer segment is also very particular with trendy fashion styles
and once they are persuaded with the uniqueness of the incorporation of traditional
to new fashion styles as well as the garments’ transformative and flexible fashion
design it provides, they would greatly influence the rest of the customer segments.

Adults
This customer segment comprises of adults ranging from 26 to 65 years old.
This customer segment is essential for the business to get their interest since they
are the ones with the most money among the three segments considering most of
them are part of the working class. This segment also involves most parents
nowadays with dependents already, thus, they are essential for marketing products
centered on infants or toddlers. Marketing on this segment would include
advertisements such as websites, posters, newspapers, magazines and billboards
since most adults often uses tangible objects more which for them are more
accessible to use rather than social media. Adults also involve themselves in the
internet such as websites wherein adults would just order the product via online
website or instead of going to the store and look for their desired clothing, they can
just view clothes on the internet which help lessen the hassle for adults.

B. Research Methodology

This section explains how the study is fulfilled which include the applied
study design, geographical area where the study was conducted, selection of
participants, approach to sample size determination, instruments used, methods of
data collection, and data analysis plan used in order to answer the research
objectives. This presents arguments as to why such a research technique was
chosen and used.

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Research Design
This study used a qualitative and quantitative research methods regarding
customer preference in malong-based clothing and accessories with mosquito
repellent formula. It aims to gather information towards different factors
particularly demographics, product quality, price, place, packaging, and promotional
mix and how it can affect customer preference.
In the qualitative data gathering, in-depth interviews and a focus group
discussion were conducted, wherein 15 participants are selected from the desired
target market and asked the same set of open-ended questions, relating to how
various factors affect the customer preference. The participants’ answers are then
recorded and analyzed for further study.
In the quantitative data gathering, survey questionnaires were distributed
containing questions related to the 4P’s in marketing: price, product, promotion,
and place, and how these affect customer preferences. These were distributed to 50
respondents physically, while another 50 was distributed online. The respondents’
answers are then tabulated as one, generalized, and analyzed. The data is presented
in graphs, tables, and charts.
The data gathered from the qualitative and quantitative methods are then
studied together to see if the answers of the participants and respondents correlate
or contradict each other. The presentation of data starts with the statistical graphs,
tables, or charts with its analysis and interpretation in relation to the survey results,
followed by statements from the participants of the in-depth interview and focus
group discussion.

Research Environment
The setting of this study is in three different locations in Cebu. It is in the
University of San Carlos - Downtown Campus, and in Ayala Center Cebu. Different
locations were chosen to be be able to cater the different target markets of the
researchers, and to gather accurate data for the qualitative and quantitative aspects
of this study.

33
 The qualitative data gathering took place in the University of San Carlos -
Downtown Campus which is located at P. Del Rosario St., Cebu City. It is considered
as the oldest college institution in Asia which was founded in 1595. It is the home of
the School of Business and Economics, School of Law and Governance, and the
Senior High School - ABM, with an average of 3,000 students enrolled. As shown in
figure 1.1, the university is found near historical sites like the Magellan’s Cross and
Basilica Minor del Santo Niño. Furthermore, it is also surrounded by malls and
supermarkets like 138 Mall, Super Metro Colon, Colonnade Supermarket, Metro
Gaisano, and other business establishments.

Figure 1.1. Map showing the University of San Carlos - Downtown Campus and its
nearby establishments.
The quantitative data gathering took place in Ayala Center Cebu which is
located at Cebu Business Park in Cebu City. It is a large shopping mall that first
opened in 1994. This mall is widely popular and often visited by both tourists and
locals alike. On an average day, more than 85,000 people visit Ayala Center Cebu,
with the figure increasing to 135,000 on weekends. As shown in figure 1.2, the mall
is surrounded by a lot of business establishments, hotels like Seda Cebu, Golden
Prince Hotel and Suites, Quest Hotel, and Hotel Elizabeth, and banks like Maybank,
Chinabank, and Standard Chartered Bank. Many people want to reside or stay near

34
Ayala Center Cebu because it is one of the main shopping and leisure districts here
in Cebu, City.

Figure 1.2. Map showing the location of Ayala Center Cebu and its nearby
establishments.

Research Participants
For the qualitative survey questionnaire, a total of 15 interview participants
were selected from the University of San Carlos — Downtown Campus. There were
5 in-depth interview participants while there were 10 focus group discussion
participants. The in-depth interview was conducted by each researcher, where one
acted as the interviewer. The participants chosen range from teens, young adults,
and adults. The focus group discussion was conducted in a classroom where all 10
participants, all ranging from teens, young adults, and adults. Two researchers acted
as interviewers while the other three acted as the scribes, recording and note taking
what the participants were saying.

35
 All 15 were selected using simple random probability sampling, where the
participants were selected randomly, this ensures that each member of the desired
target market has equal probability of being chosen.

Research Respondents
The researchers have 100 respondents, 50 of these respondents are from
Ayala Center Cebu. The respondents ranged from teens, young adults, and adults.
These respondents will provide sufficient amount of data for the interpretation of
this study and their correlation to the target market. The 100 respondents were
necessary for the researchers to have an adequate amount of data, and this was then
divided equally by 50 physical survey and 50 online survey to ensure that there was
an equal distribution of information from the research respondents.
For the quantitative survey questionnaire, the researchers used simple
random probability sampling to select 50 respondents in Ayala Center Cebu; the
respondents ranged from teens, young adults, and adults. For the other 50 survey
respondents, an online survey was conducted using Google forms; the survey’s link
was then shared to various people ranging from teens, young adults, and adults.
Simple random probability sampling was used by the researchers wherein
the selection of the survey respondents were selected randomly. This method of
probability sampling creates samples that are highly representative of the
population and it eliminated biases. The population of interest in this study is
defined as prospective customers of local clothing products.

Research Instruments
The researchers designed an interview guide and a survey questionnaire for
the data collection instrument of the study. The interview guide was made to cater
the qualitative aspect of the study. Such way of collecting data is essential to attain
36
highly personalized data, deal with opportunities required for probing, and acquire
a good return rate in the study. It is important as well for respondents that are more
fluent in the native language of the country or where they have difficulties with
written language. On the other hand, the questionnaire was made to yield
quantitative data for the study. It has its main function for measurement.

The interview guide is focused mainly on four categories, namely, product,

price, place, and promotion. These four P’s were chosen since it directly impacts the
objectives of the study. In the first section, the participants were asked as to how a
number of factors influence them in their buying behavior as well as their insights
on the proposed product of the business. The second section talks more about the
participant’s individual preferences when it comes to clothes and accessories as
well as their opinions as to why fashion styles differ. The third section aims to
gather data regarding the participant’s main selections when it comes to the
location of the establishment. Lastly, the fourth section focuses on the promotional
aspect of the data collection wherein participants are asked regarding the marketing
strategies that greatly influence them in their buying behavior.

The researchers designed a survey questionnaire in order to cater the

quantitative aspect of the study. It is made to measure the behavior, attitudes and
preference of the study’s large number of subjects. The questionnaire starts with the
acquisition of personal data from each respondent. It mainly involves the
demographics of the respondent. It is then followed by the survey’s main questions
that is close-ended in nature which involves multiple choice questions, ranking
questions, yes/no questions and a Likert scale. This section focuses on the
participant’s preferences in terms of style and shopping. It also emphasizes on the
different factors such as the business’ positioning, product quality, packaging, price,
store locations and promotional strategies that can affect and influence the
participant’s buying behavior. The last section of the survey questionnaire is the
open-ended questions. It aids in the direct data collection of the participant’s views
and opinions regarding the business’s proposed product.
37
Research Procedure: Collection of data

The study’s primary data was acquired from the qualitative research
methods which include in-depth interviews and focus group discussion. The in-
depth interview consists of 5 overall participants while the focus group discussion
consists of 10 participants. The interviews were recorded, transcribed, and
translated in order to answer the objectives of the study. These methods are
employed to answer the why’s and how’s of human behavior and opinion. These aid
in gathering information which are considered to be difficult to obtain through more
quantitatively-oriented methods of data collection. When used along with
quantitative methods, such qualitative methods can help interpret the complexity of
the study as well as the implications of the quantitative data collected.

The study’s secondary data was obtained through two foundations. First is
through previous journals, articles, dissertations, and other verified sources online.
This information was applied for the validation of the data gathered from the
primary data both qualitative and quantitative. It assists the study in providing a
clincher especially when the qualitative and quantitative data contradicts one
another. Second is through survey questionnaires which are distributed physically
and online. There was a total of 100 questionnaires wherein 50 questionnaires were
printed and distributed to respondents in the research environment while the other
50 questionnaires were coded and distributed through Google Forms.

Treatment of Data
The data gathered from the primary data, which is the qualitative interview:
In-depth interview and Focus Group Discussion, were being gathered, transcribed,
and translated which will be one of the factor to support the results of the study. The
secondary data which is the quantitative survey: Physical and online surveys. It uses
statistical tools which are the frequency distribution and Chi-square. The frequency
38
distribution was used for the computation of the results for the demographic profile
of the target market and the buying preference regarding to clothes and accessories
of the target market. The other statistical tool was the Chi-square and weighted
mean which was used for the target markets preference regarding to the 4P’s.

Formulas used:
Frequency Distribution:
P= f / N × 100
Where:
P = percentage
f = frequency
N= total sample
Chi-square:
MegaStat
Weighted mean:
Wx = (x*5)+ (x*4)+ (x*3)+ (x*2)+ (x*1)
∑x
Where: Wx = weighted mean
x = number of variables
∑x = summation of x variables

39
40