Strategic Plan For Setting Up A Clothing E-commerce Business Essay.

1. Briefly describe an eBusiness you would like to develop, including the products or services you would like to sell.

2. Write at least three goals for your business. Each goal should include both a brief statement of purpose and a brief explanation.

3. Clearly describe in detail, the eCommerce strategy you are going to use to achieve your goals including aspects such as, but not
limited to, value propositions, revenue models, target markets, business models, capital realisation and SWOT analysis.

4. Conduct an external environmental scan using Porter’s Five Forces Model and discuss the key factors that might impact the success of your business.

5. Clearly describe in detail, a marketing and advertising strategy for your eBusiness including aspects such as, but not limited to, behaviour models, consumer profiles, trust and validity, mobile, Apps, email, social media, transaction logs, and cost benefit analysis.

Modernisation of global business has developed the E-commerce business platform to be used by contemporary entrepreneurs (Barnes-Vieyra and Claycomb, 2011). The identified study report has been structured to introduce a strategic plan to initiate an E-commerce business. Precisely, the entrepreneur’s idea is to set up a clothing E-commerce business using the internet platform. In the study, the detailed description of the eBusiness including the products and/or services offered to the target demographics has been provided. Moreover, the strategic report for the clothing E-commerce business identifies three business goals to be taken into consideration for the futuristic growth of the business.

By identifying the specific business goals of the entrepreneur, the reported study addresses the E-commerce strategy to be used to meet the business goals. Invariably, the report also describes value proposition, revenue models, target markets, business model, capital structure, and SWOT analysis of the clothing E-commerce business (Chaffey, 2011). In addition, by using Porter’s Five Forces Model, the external business environment has been scanned to identify the key success factors influencing the growth. In the meanwhile, the strategic plan elaborates the marketing and advertising strategy to impress the target audience. Evidently, the behaviour models, consumer profile, use of social media and mobile apps, transaction logs, and cost benefit analysis of the E-commerce business have been analysed in detail (Rodríguez, 2013). 

The entrepreneur has selected a clothing E-commerce business namely Style Icon in the target market of Melbourne, Australia. At the inception of the E-commerce business, the business organiser will set a website offering branded clothing accessories to the both men and women demographics located in the Melbourne and nearby suburbs. In the meanwhile, the eBusiness of Style Icon will offer shipment to the target demographics of Melbourne only. After six months of business start-up, the eBusiness will cover the entire Australian territories and major metropolitan cities. Style Icon will offer different branded clothing categories for men and women target audience. For men, the E-commerce website will offer trending shirts, t-shirts, jeans, trousers, jackets, suits, and cargo etc. apart from the clothing and apparel, different types of branded footwear will be displayed to the target audience. For female customers, latest designer’s tops, shirts, jeans, skirts, and lingerie etc will be sold via the website. Also, clothing accessories such as belts, handbags, and other fashionable products have been offered to the visitors.

Primarily, the outlook and accessibility of the website can be termed as one of the main aspects to attract the clients. Apart from the official shopping website, android and iOS app of Style Icon will be launched so that interested target audience can order clothing items from their Smartphone and devices. The display and presentation of the website have been developed considering the preferences of the target audience to make it easy for the web-surfers to get the right product at the right price (Chircu and Kauffman, 2010). In the website, a chat option will be added so that customers can ask for the help of the executives to select the accurate product at a nominal time. Moreover, the eBusiness portal of Style Icon will offer a safe and secure portal to purchase items using all type of cards (Martinsons, 2016).

Business Goals

Setting up definite business goals can be one of the vital instruments to achieve success in the eBusiness platform (Chesher, Kaura and Linton, 2013). In the underlying section, three business goals of Style Icon have been discussed stating the purpose as follows:

• Identifying Latest Consumer Trends: In order to develop a vast target audience pool for the E-commerce business, identifying the latest consumer trend can be one of the most primary business goals for Style Icon. Matching the ever-changing consumer trends, the eBusiness of Style Icon can stay viable and promote massive demand as well.
• Achieving Brand Recognition: Moreover, gaining brand recognition will be another vital business goal for Style Icon to create lucrative prospects in the E-commerce business. By strengthening brand recognition of the eBusiness, Style Icon can achieve substantial competitive advantage over the other market players influencing the target audience to purchase at a higher price from the online retail store (Lockett, 2014).
• Maintaining sustainability and profitability: Effectively, maintaining continuous business growth and profitability can be identified as a leading business target for the E-commerce business of Style Icon. Meanwhile, the business must secure incurred profitability at a regular interval by increasing revenue over costs (Zhuang and Lederer, 2014). Precisely, by balancing the cash flow, sustainable business growth can be achieved as well. 

In order to set up the E-commerce clothing business of Style Icon, the entrepreneur must look for micro-target the online target audience by establishing a territory (Friedman, Lopez-Pumarejo and Friedman, 2008). Such micro-targeting of online audience should be the best E-commerce strategy in this case. Effectively, the micro-targeting strategy will be effective to develop and design a website following the choices and preferences of the target audience belonged to the niche market (Zhuang and Lederer, 2014). Also, special offering and online customer service will be ideal to increase the brand identity of Style Icon online retail store. Evidently, a business model canvas of the eBusiness of Style Icon has been presented in figure 1.

The nine components of the business canvas of the E-commerce clothing business have been described as follows:

• Key Activities: The E-commerce strategy of the business will include key activities such as quality control, online assistance, supply chain management, and latest consumer trends to influence target audience (Miller, 2015). In this way, brand recognition will be improved.
• Key Partners: In the E-commerce set up of the clothing business, a number of key business partners will be involved. For instance, audit partners, logistic partners, marketing business partners, technology partners, and financial partners will be identified as the leading partners influencing the growth of the eBusiness of Style Icon online retail store.
• Key Resources: Invariably, for the identified strategic intervention, human resources, invested capital, technology, and eBusiness infrastructure of Style Icon can be termed as the key resources. Each of the key resource has significant value to accomplish the long-term objectives of the business in the target market (Quix, Schoop and Jeusfeld, 2012).
• Value Propositions: Precisely, for a new entrepreneurial E-commerce business, identifythe value proposition will be critical. In this case, high quality of clothing products, unmatched buying experience of the consumers, competitive pricing of trending apparels, suitable online support, and easy replacement and refund of products will be promoted as the leading value proposition (Goyal, 2017).
• Customer Segments: During the inception of the E-commerce business, Style Icon will offer branded clothing accessories to the both men and women (especially office goers and college students) demographics located in the Melbourne and nearby suburbs. After six months of business start-up, the eBusiness will cover the entire Australian territories and major metropolitan cities mostly the urban population of the country.
• Customer Relationship: To build customer relationship, the eBusiness will use online customer support system. Discount offers on products, customers’ feedback policy, and interesting coupons on bulk purchase (Karakaya and Shea, 2008).
• Customer Channels: The eBusiness of Style Icon will be massively relied on customer channels. In the meanwhile, social media channels and digital media channels have been identified as the most comprehensive customer networks. Besides, the internet based consumer channel will be taken into account as well (Goyal, 2017).
• Cost Structure: The fundamental cost structure of the E-commerce business of Style Icon has been divided into four sections i.e. wage and salary of employees, primary operational costs, website maintenance charge, and purchase of clothing items from the branded companies.
• Revenue Streams: In order to declare the revenue stream of the eBusiness, revenue earned from the sales of clothing items has the lion’s share to determine the income. Furthermore, fixed income from the sales and additional discounts given by the manufacturer and distributors will be considered as other revenue sources of the eBusiness. 

The SWOT analysis for Style Icon E-commerce business has been presented herein below:

In order to analyse the external environmental factors that may influence the e-commerce business of Style Icon, the Porter’s Five Force Analysis has been presented herein below:

• Buyer’s Bargaining Power: There are a huge number of buyers and sellers in the market that reduces the switching cost of the buyers. Hence, the bargaining power of the buyers is too high for Style Icon e-commerce business (Deng and Zhang, 2014). The company need to set price and develop products according to the preferences of the customers.
• Supplier’s Bargaining Power: There are a huge number of suppliers in the garment industry (Barnes-Vieyra and Claycomb, 2011). The company can shift from one supplier to another in case of change of price. Hence, the bargaining power of the suppliers is quite low in the market.
• Threats from Substitutes: The Company will deal with branded products that are easily available in the e-commerce stores of other rivals. Hence, the threat from substitution is high for the company (Constantinides, 2012).
• Threats from New Entrants: Style Icon e-commerce business will operate in a competitive market where the cost of entering the market is quite low (Deng and Zhang, 2014). There is almost no barrier to entry of new firms. Hence, the threat from new entrant is high for the company.
• Threats from Rivalry: The fashion retail industry has a huge number of companies such as Jac and Jack, Ally Fashion, Miller’s Retail that will provide a high level of competition to the Style Icon’s business (Constantinides, 2012). 

In order to develop the marketing and advertising strategy for Style Icon e-commerce business, it is important to understand the changing behaviour of the consumers and choose the target market effectively. The marketing and advertisement strategy of Style Icon e-commerce business has been present in the underlying section:

According to the KPMG report (2017), E-commerce has become a rising trend in the recent times in major developed countries such as Australia, the United States, the United Kingdom, Germany and several other European and Asian countries. It has been found that people of Generation X (age between 36 and 52) are found to shop more over the online portals. The transaction per person per years is as high as 19 for the generation X (KPMG, 2017). Hence, it can be seen that the growth potential for online business in Australia and other major developed countries have been rising in the recent times.  

It can be seen from the report of KPMG (2017) that the men spent more money on online purchase as compared to women. Furthermore, the generation X people are highest user of e-commerce portals who generally prefer to shop online due to their busy life schedule. Hence, the company will target both male and female consumers with different ages by offering products for all consumer profile. Additionally, the company will offer cheaper products to target middle class people that make the maximum proportion of the target demographics. 

In order to develop trust and validity, the company will offer 10 days return policy to its customers on all products. The customers will be allowed to return the product if they are unsatisfied with the quality and size of the product within ten days after receiving it (Goodman and Lin, 2017). Additionally, the company will return the money of the consumers to their wallet as well as to their bank account in order to build trust among the consumers.

E-Commerce Strategy

The company will use different digital marketing strategies to promote the business. For instance, it will make use of SEO to create traffic for the new e-commerce website. Additionally, the company will develop mobile Apps to reach more number of customers who prefer to buy through online mobile applications (Keating et al., 2015). Furthermore, e-mail marketing tactics will be used to retain old customers. Moreover, the company will conduct public relation activities through press release to increase the customer awareness (Nag, 2015). A cost estimation of the marketing activities have been presented in Appendix 1.

The company will make use of online accounting software to keep the track of transaction logs. However, Style Icon will use third party payment gateway portals to securely receive payments from the consumers (Orme and Etzkorn, 2016). For instance, the company can make use of PayPal and Payoneer to securely receive payments and keep track of the transactions. Moreover, other secure payment gateways will be used to expect payment through credit and debit cards. The use of third party portals will increase the trust among the buyers and make them feel safe to buy products from Style Icon’s e-commerce website.

There are several cost and benefits for developing an e-commerce business. The costs that are to be incurred by the organisation mainly include costs for technology, costs for consultancy support (design and implementation), cost for staffs, and operations costs (Standing and Lin, 2016). It is expected that Style Icon will need an investment of $100,000 to start-up the e-commerce business. A breakdown of the start-up costs and other recurring costs for one year has been presented in Appendix 1.

On the other hand, the benefits for starting a e-commerce business include a good financial return, better transparency, and high customer reach through exposure to a large number of target audiences beyond the geographical boundary (Zhuang and Lederer, 2014). It is assumed that the company will start with revenue of $20,000 in the first month and seek 20 percent growth in the 2^nd and 3^rd month. However, a growth of 30 percent is expected in the 4^th to 6^th months and 50 percent in the 7^th to 12^th months. A financial projection has been presented for further consideration. 

Conclusion

On the basis of the above analysis, the e-commerce venture for Style Icon has potential growth opportunities in the Australian market. Additionally, the company can easily expand its business beyond the political boundary after seeking growth in the domestic market. However, Style Icon needs to focus on digital marketing strategy to create brand awareness and reach a higher number of target demographics. Moreover, the company must focus on middle class people that make the maximum proportion of the target market. Style Icon needs to use competitive pricing policy to attract more customers and introduce 10 days return policy to win their trust. Conclusively, a properly planned strategy can help the company to seek competitive advantage and potential growth in the market. 

References

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