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AVAPRENEURSHIP

Group 1Ba Yucheng 70409Gkanidou Eftychia 40096Han Weiqiang 70399 Ma Silin 70401Zhang Wenrong 70407AVAPRENEURSHIP

The interviweeThe SL Footwear industryPorters Five Forces ModelKey Success FactorsStrategic GroupsAssessments

AGENDAJacquelene Slade is the proud owner of one main shoe storeShe rents 4 other stores in Shopping Malls (Mega Mart, Scorpian Mall)She is a creator and cooperates with 1 resellerShe is active the past couple of yearsTHE AVAPRENEUR

Dress shoes and sneakers for men and womenCreating a shoe that no one else hasCreating shoes the customers are looking forSmart pricing

STRATEGIC POSITIONINGSwafeette firefly: lower price, basic shoes, easy to find, variety both men and women) //AVA CHOO-MAINLY WOMENS SHOES HIGH HEEL/ FASHIONABLE/ BOOTS/ AVERAGE PRICE (customized productsprofessional suggestion+focus on serving after selling)4THE FOOTWEAR INDUSTRYSUPPLIERSCREATORSRESELLERSBUYERSMARKETINGPORTERS FIVE FORCESSUPPLIERSPOTENTIALENTRANTSSUBSTITUTES(free/no shoes)BUYERS(consumers/resellers)INDUSTRYCOMPETITORS(creators)Rivalry amongexisting firms (HIGH)Bargaining power of suppliers (LOW)Bargaining power of buyers (HIGH)Threat of

new entrants (MEDIUM)Threat of

Substitutes (MEDIUM)

Overall, the market is profitable and there is room for new players. What is needed is good building skills or good RL software knowledge.6 The actual cost for my material is the cost of time I spend making them

Backward integration of creators-in SL shoe creators can create their own virtual shoes without cost or other limitationsPurchase of raw material for shoe-manufacturing is possible but scarce for virtual creators

POWER OF SUPPLIERS- LOW

Buyers are the same as in RL, if you like shoes in RL, you also like your avatar to have shoesMany potential buyers but relatively few buy.The older avatars willing to spend quite a lot on nice looking shoesLots of stores that offer anything one can imagineBuyers demand for free products

POWER OF BUYERS- HIGH

Absence of economies of scale

Incumbency advantages independent of size are quite significant

Low cost of entry

THREAT OF ENTRY- MEDIUM

1)When creating a shoe, you can have as many copies as you wish with no extra cost 2)Incumbency advantages such as knack for doing good-looking shoes, softwear knowledge etc9

Avatars can build their own shoes-shoes, though, are relatively hard to make-there are ongoing learning programs but they are time consumingAvatars can go without shoesAvatars can get free shoes the quality of which is not satisfactory for older avatars

THREAT OF SUBSTITUTES- MEDIUM

I love to see what my competitors do, sometimes I dont like what they do and sometimes it inspires me, but its more important for me to come up with an idea for a design and style I havent seen in SL for my own store. DEGREE OF RIVALRY- HIGHPiracyKeep an eye on competitorsSlow growth of the marketNumerous competitors, roughly equal in size Piracy-keep an eye on competitors pricing11WHAT DO CUSTOMERS WANT?Customers want well-built, quality shoes that look nice on their avatars. Extra functions are often quite important. Fancy shoes that they like but cant afford in RL. Enjoy stores, where they can find new shoesHOW DOES A FIRM SURVIVE COMPETITION?Compete primarily on combination of price-technologyHigh competition, style, looks and quality in the spotlightBusiness background important & follow up latest trendsWHAT ARE THE KEY SUCCESS FACTORS?Possibility of differentiation through quality and style, that can appeal to a large portion of the populationMultifunctional shoes that combine many features (sound,color)Marketing &WOMRegular exhibition of new items

SL FOOTWEAR INDUSTRY - KSFsProfitability could increase by decreased piracy // technology:softwarephotoshop, sketch up, sculpted maps

12B&WQUALITYTHE STRATEGIC GROUPSAVA CHOOSHOE CENTERSTILLETTOMOODY PRICELowLowHighHighSTILLETO MOODY:BEST WOMENS FASHION SHOES-MOST EXPENSIVE / B&W (DRESS SHOES- FROM 500 L competing also retailers that have shoes amongst other staff!!! :D limitation regarding building skills best shoes need great skills easier to move to other strategic groups13STRATEGIC GROUPSAVA CHOOB&WQUALITYSHOE CENTERSTILLETTOMOODY PRODUCT RANGELowLowHighHighTHERE ARE MANY NICHE STORES!14Improve industry profitabilityFight against Piracy-PatentsInnovation and new designing techniquesOrganize theme events for people who love shoesFocus on sneakers-building skillsExcel at sneakers to come up to a sports niches expectationsMens shoesUse of marketing to raise brand identification

ASSESSMENTSSuggestions for Shoe Center

THANK YOU