PATAGONIA

Group 2I
Abhishek Agarwal
Rishab Kothari
Pragya Pathak
Mayank Gupta
Sri Harsha Mikkilineni
Shanu Malik

Evaluate Patagonias business model. How important to

Patagonias business model is its environmental position?
It is worldwide leader of environmentally responsible business
Its main aim was providing the most sustainable products and not profit
maximization
Mission statement
To build the best product
Cause no unnecessary harm
Use business to inspire and implement solutions to the environmental crisis

It decided to manufacture its cotton products from organically produced

cotton to achieve lower environmental footprint
It made products with longer shelf life and multi-purpose products
Accepted used goods from other companies too for repair

What is your assessment of the Product

Lifecycle Initiative (Reduce, Repair, Reuse, and
Recycle)?
Initiative was environmentally sustainable and consumer friendly
Word of mouth publicity of Patagonia and acquisition of a base of loyal
customers
Lead to more environmentally friendly innovations and applications
Became frontrunner for other companies like Nike and Gap to use
sustainability practices
Giving Patagonia a competitive marketing and positioning edge
Increase in costs which included extension of existing services,
investment in research and design, increasing number of staff members
Dependence on customer response and involvement

How fast can Patagonia grow? How fast should

it grow? Why?
With the possibility of better inventory management and online marketing
etc., change to high-growth mindset will provide fine opportunities in future
which could further result in rapid growth of Patagonia
With the various techniques prevailed in industry, Patagonia can increase
its growth rate from 6% to 10% on average.
But rapid growth and profit maximizations are not Patagonias main
concern
It has passion for environment and beliefs in self-sustaining growth
Much focus on profit will be change in companys belief and culture of
environmentalism
Capacity and resource constraints cant handle such rapid growth without
compromising beliefs

Unique Product Differentiator & Business

Model if Publicly Held
Patagonia donates 1% of its revenues to environmental causes, provided in
donations to environmental groups and invests thousands of dollars into
reducing environmental impact in production process
Its environmental impact, quality and innovation (Multifunctional) are what
makes the product unique and allows the company to charge 20% extra
It spends less than 1% of sales on marketing and advertising, far less than
most other competitors as it receives lot of attention and free publicity from
media due to its environmental position
The net income growth and gross profit margin of the company are on par
with the industry trends and above that the company has a very good
reputation
So even if the company was publicly held the business model need not differ
from the present one

Material positive impact on the environment

and society
Reducing environmental impact at every step of production process
Using less environmentally damaging dye
Reducing packaging

Took decision to manufacture all its products from organically

produced cotton in 1996
Five Pronged Philosophy to environmental initiatives
1. Lead an examined life
2. Clean-up our own act
3. Do our penance
4. Support civil democracy
5. Influence other companies

Secret of success of Patagonia in its

environmental integration in business strategy
Secrets of Success
Integration of Triple Bottom Line
Dirt Bag Work culture
Strategies beyond Marketing tactics
Business philosophy

Like Patagonia, socially responsible organisation can be created from Surfing

Materials : The materials used in Surfboards and other equipments should be
recyclable and must pose no risk to the marine life
Apparels : Environment friendly and durable apparels should be made
Suppliers : Materials should be sourced from environmentally responsible
suppliers
Society : The organisation should support Social and Environmental causes

Do not buy the Jacket- Do they really mean

that?
Patagonia is always a company which believed in creating positive
social and environmental impact
They created an awareness in the consumer to Reduce Reuse Repair
Recycle
So when they say do not buy jackets they mean to buy them
judiciously and buy when and only required
By being sustainable the company received a lot of free publicity and
media attention there by reducing advertising costs
Brand Awareness also improved multi-fold due to this strategy
The brand was positioned as a sustainable and environmental friendly
brand which created a goodwill for the company

Thank You