08Fall

GEOX’S PRODUCT INNOVATION

ASSIGNMENT 1

ContentsINTRODUCTION.....................................................................................................................................2

CREATIVITY............................................................................................................................................2

COMPETITOR ANALYSIS.........................................................................................................................4

MARKETING STRATEGY..........................................................................................................................7

Geox’s strategy blue strategy............................................................................................................7

Geox’s red strategy..........................................................................................................................10

How innovation element help Geox’s achieved the strategic..........................................................11

RECOMMENDATION............................................................................................................................13

CONCLUSION.......................................................................................................................................13

APPENDIX............................................................................................................................................13

Appendix 1.......................................................................................................................................13

Appendix 2.......................................................................................................................................14

Appendix 3.......................................................................................................................................14

Appendix 4.......................................................................................................................................14

Appendix 5.......................................................................................................................................15

Appendix 6.......................................................................................................................................16

References...........................................................................................................................................16

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INTRODUCTIONIt was in the summer of 1992, when Mario Moretti Polegato, during a short walk in

the Nevada desert, his feet got sweat and smelly. He knew that his shoes are

absolutely inappropriate for the environment and he had to suffer. Taking out the

pocket knife and cut holes in each of the sole, just the let the heat out. Immediate

relief come to Polegato and also thinking, the ever new idea, "shoes that breathe".

Back in Italy, he then searching every corner for breathing sole, and no shop had it.

3 years studying, researching, development just to transfer his idea into product, a

shoes that breathe and watertight, and he did. However, his passionate is not in

manufacturing shoes, instead is his family wine-producing and exporting, so he tried

to sell his invention to leading shoes company in Italy and worldwide, but they all

turned him down. Thanks to those shooking head, Polegato, with 5 other employees

decide to manufacture the shoes themselves. And the genesis of Geox begins.

As the result, 15 years later, ,Mario Moretti Polegato, whom groomed to take over

the wine-making business of his family, have made his young company Geox, the

world second-largest casual lifestyle footwear ( Figure 1) (Appendix 1 ) . Adding on

that success, there is a combination between creativity, product innovation as well as

distinctive marketing strategies

CREATIVITY First of all, what is meant by creativity? According to Amabile et al. (1988), it is the

development of novel ideas, products, processes or procedures by individuals or a

group of individuals working together. In addition to that, Linda (2012) also advised

that creativity is the process of turning the imaginative or new idea into product. And

that's how Polegato did with his thinking.

And the question now is how creativity relates to different types of product

innovation? We acknowledge two popular type of product innovation which are

incremental innovation- in which we make an improvement from what already

existed, whereas radical innovation is giving the completely new product to the

world. In a business concept, Ford (1996) figured out that creativity and innovation

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are perceived to be so closely linked that these terms are often used

interchangeably. Just take an example from Volkswagen. When they trying to create

some joke for a car on an April Fool’s Day joke. The Polo Harlequin was created,

with the idea of each part of the car was painted a different colour (figure 1.2)

(Appendix 2)

Surprisingly to Volkswagen, that idea got many customers’ interest, and of course

this car was all over Europe. Realize along with Jacob and David (2002), there is

similar between creativity in products and service. Taking the world leader in pizza

delivery Domino’s Pizza. They launch their new novel idea which is if you have to

wait longer than 30 minutes, the price of pizza reduced. And there is a boom in

Domino’s business after this promised (Jacob & David 2002). Two above example

have somehow demonstrated how creativity relates to product innovation,

specifically the incremental innovation.

Back to Geox, the most important factor that lead to a successful young shoe

company is while most innovation now is incremental innovation, Polegato had a

think of absolutely a product that like-no-other. The shoes is a basis product, and

even though he just think of a shoes with hole in a flash time, but a lot of times and

effort were put in to create a shoes “that breath “ and watertight. That’s how his

creativity relates to the world-known products, which make Geox stand out from the

crowd and quickly achieve what they got today.

Think and act, two basic and key things for creativity. You think of better idea, you

work on them, make what imaginative become to real products, that’s how creativity

relate to product innovation.

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COMPETITOR ANALYSIS

Product

Categories

Classic

product

( elegant and

traditional)

Casual product

(wearable and

adaptable)

Sport product

(running and

golf)

Casual product, Smart

product( Active air, GORE-

TEX), Work wear, sport ,

Unstructed product and

Leather bags

Wide range of

sport

equipment( Runni

ng, Training,

Basketball,

Soccer, Sport-

inspired Casual

shoes, Kid’s

shoes, Sports

apparel and

Accessories

Product

Description

Comfort and

breathing,

watertight

shoes

Classical and formal wear Sporty and

fashionable shoes

Features

( Competitiv

e

advantages)

Breathing

Technology( k

eep feet dry

and cool)

High quality product and long

wearing

Brand recognition

and stylist design

Country of

Origin

Italy UK U.S.A

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Pricing Medium to

high

High- end price, costly Affordable price

( depends on

categories)

Website www.geox.com

website not yet

fully

operational

www.clarks.com.au

poor layout, classic design

and confusing navigation

www.nike.com.au

layout ok,

informative and

professional

design

Target

Customer

Kind brand

catering to the

entire family

Men, Women and Kids Essentially for

specific athletic

use and casual

shoes for variety

age

Marketing

strategies

Advertising

campaign( bill

posting )

Based on

Innovative

technology

instead of

using celebrity

Promotions and TV

Advertising

Use celebrity

athletes,

sponsorship for

sport event

Throughout the competitive analysis, competitive features are mentioned, comparing

with Clarks and Nike across defined criteria. The purpose of the analysis is to help

manager having a better understanding about the Geox’s innovative product will be

competing within global footwear market. On the other hands, based on how

competitor’s brands are perceived by customers, Geox can maintain a competitive

advantage, which is the key factor for the company’s strategic planning.

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This competitive analysis has identified Geox’s two major competitive advantages.

Firstly, Geox company is leading brand in manufacturing “shoes breathe” , the

GEOX’s product innovation differentiates itself in footwear industry, the new

technology : the shoes had many small channels and made by watertight breathing

membrane that helps keep feet dry and cool. Unlike competitors, the Geox’s strategy

is not focus on style and fashion and appeals to the “Italian trendy style” but relies on

the product’s technical characteristics. Furthermore, Geox’s technology innovation

makes their product unique, dominated and difficult for competitors to copy and

imitate. Since, Geox had the very first step in creating a new line shoes “breathable”

with the eye-catching and craved out a niche for Geox in the red ocean of global

footwear industry. Geox had no rivals in manufacturing the “breathe shoes” because

they are the very first, in other words, a leader in this field.

The second competitive advantage for Geox would be distribution channel through

franchise or international expansion. “Each country’s individual distribution structure

and calibrated to the widespread network of multiband clients” (Mario Polegato,

founder and chairman of Geox). That could be considered key success factors by

the company beyond product innovation and could be seen the company’s success.

Since, Geox just entered the shoes market in 1995, it is about 17 years old

comparatively younger than other shoes making giants, as Nike 55 years- account

for 33.27% in market share and Adidas with 63 years took 15.97% in market share

(Appendix 3) .Geox was ranked No.2 in the international footwear market with the

10,000 multi-brand stores around the world, also had 997 single brand Geox stores

located on urban property worldwide. (Appendix 4) Geox is on the way to expanding

their business in potential market like China and India by committing partnership with

Hong Kong- listed company Belle (one of the biggest shoes retailer brand in 2007

with 22% market share). In Geox background analysis, Geox has bought Diadora, a

sports shoe brand of Italy. Diadora has great advantage to enable the Geox to

broaden the sports shoe market with the existence located store retailer in Europe

and other countries.

Finally, the biggest competitor for Geox is Clarks – the number 1 shoe retailer in U.K,

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(Appendix 1) who currently is trying to win market share in Europe market and

already has secured distribution channels in large parts of South-East Asia like

China, Indonesia and Thailand. Clarks also launched into the market product

categories for women, man and kids. Both company meet up in one point, more

focus on the research and development (R&D), Geox introduced the “ breathe shoes

and watertight” , Clarks also had recognized product Active Air, Waterproof for men,

Flex 24 for women. Furthermore, Clarks Company also has done research market to

launching a line of shoes that have features designed for customers with specific foot

needs. One more point to assist the Clarks have more market share in the shoes

industry is fashion design, Clarks always deliveries to customer variety of new

design shoes with trendy and stylist collection within year while Geox does not, a few

seasonal collection came out .

MARKETING STRATEGY

Geox’s strategy blue strategyGeox‘s strategy that focus as “the blue ocean strategy” that means Geox’s strategy

is varied. As lots of efforts and capitals already spent on the research and

development of the shoes, Geox also make it more complex or almost impossible for

competitors to catch up with what they are doing. For the purpose of product

innovation, Geox’s has focused its efforts on the application of new technology to the

shoes industry, either fashion is the main thing they need to concentrate as shoes

need to be update, style and design or comfortable, conveniences for customer.

Geox’s offers a range product which could be suitable for all group of target

customer based on customer’s needs and wants.(Appendix5).

After seventeen years working on the footwear industry, Geox’s is became the

second largest causal lifestyle footwear sector operator, and Geox’s has penetrated

markets in over sixty eight countries all over the world and has strong reputation in

customer mind . Geox’s are using the new strategy position and unique configuration

of complementary activities in the footwear industry, also with helping form new

technology, Geox’s to offer a unique product “the shoe that breathes” that is assists

the feet breaking and is waterproof by absorbing and expelling the perspired sweat

without letting temperature hence, not just remain healthy also provide good looking

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product and comfortable for customer who using Geox’s product. (Geox’s company

focus to wide customer base or an affordable price for customer)

Moreover, Geox’s concentration is on the shoe-sole technology. It can solve

customer problem as they provide one product that better and more comfortable. In

addition, customer’s health problem also been taken care of.

Furthermore , Geox’s has a good team of managers who conceive breathing shoe

sole as a type of technological platform upon which the design and manufacture of

footwear’s that meets customer need of all group customer.

Finally, not just focusing on the quality of shoe sole also Geox’s look at the way

promotion that help them can achieved customer mind by up to date new fashion

style, make new design every single season, using promotion program as sale off in

public holidays, loyalty program and lastly is using adverting and communication in

mass media, magazine, newspaper or new event and etc.

After following the Geox’s new strategy, Geox’s can attract more customer by selling

the benefits of the shoe that breathes, which lead to an increasing in number of

potential customer and market segmentation.

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Figure 1 Stage gate

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Geox’s red strategy In this report Geox’s focus on two main competitors are Nike and Clark, both of them

are direct competitors, with Nike focus on the sport shoes and Clark focus on the

casual. Each of company that tent to be specialists as making different form their

competitor as product within a narrow product range in one or few market segments

as different group of customer to provide different type of product as sport shoe,

casual, footwear, etc. on the other hand they can using the different type of material

to help customer feel comfortable, conveniences with their company product that

also provide the differences style, design and material that adapt for each group of

customer.

Also the new strategy of Geox’s worked quite well because, unlike most of Geox’s

competitor the focus was not on fashion and style alone, although on a technique

aspect of the product that clearly differentiated it form other product, more over with

new strategy Geox’s can use one message that can be used to address consumer of

all target groups all over the world and becoming the multinational corporation

success company whereas Goex’s competitor just give their message directly to

special group of target audience that make them wait time and money.

Also in Geox’s marketing strategy they using around 10% of the company’s turnover

were invested in promotion as they determine the advertising really important thing

need to do. They using the simple traditional to achieve customer mind as billposting

and print. Last but not least Geox’s target is to all group customer event low, middle

or high income, potential customer can define as whom no wanted wet or smelly

feet.

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How innovation element help Geox’s achieved the strategic

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Source: Sawhney, et al (2006) The 12 Different Ways for Companies to Innovate. MIT Sloan management review, SPRING, VOL.47 NO.3

ASSIGNMENT 1

Geox’s has good manager term, that they using the new technology to make

guidelines for their own company business development

Product innovation they using the group focus, online, telephone service that

give deeper inside customer need and want also they keep researching by

using loyalty program after that they come up with patenting and

implementing new solution that help customer fix problem as make three type

of shoes ( Appendix 6 ). Also by using high technology Geox believe that they

can make one product that makes their competitor hard to copy event when

company product was sole. Not just focus on the style and new design of

product Geox’s company also want to brings as much as benefits for their

customer as they can by reducing the water wet and smelly feet

Consolidation of the leadership position achieve in any location around the

world by using Italy as the sample they opening more new Geox’s shop in

shopping centres or high traffic city centres. It can help company increasing

the market share and strengthening the loyalty program of multination

corporation brand in the world

International expansion : Geox’s company want to achieve customer around

the world and by extend more foreign shop Geox’s can increasing amount

number of customer served to increasing market share and loyalty among

existing customer and target to potential customer by opening new shop in the

main shopping centres, airport shopping, and city shopping centres in the

country Geox’s focus.

Also by focusing in the new distribution channel Geox’s can make more successful

to achieve customer and help company increasing market share and brand equity.

After 17 years running the business now Geox’s has been more than 10,000 multi-

brand stores over the world and more than 997 single brand located. Which 77%

were franchises and 23% were directly operated store. The goals of Geox’s

Company that they want to promote Geox’s brand to end-consumer on the

consistent basis. They also to provide two ways for customer searching company

product as directly in store( personal selling can provide much information as

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customer need) or online store by searching, choosing and payment after that

company product will delivery to customer house.

RECOMMENDATIONTo be successful and capable of taking market shares from other leading brands in

the shoes industry, Geox should first focus on incentivizing marketing activities.

First and effective approach may concern with greater cooperation with social

celebrities (in the field of sport, cinematography, in particular) for better reputation of

the brand in the vast area of social media integrating with the development of

specific range of product. The disadvantage of the approach is its cost and

attachment to the figure being advertised.

Further, public relation approach in marketing principles can be applicable for Geox,

for instance, sponsoring for sport events, competitions, sport teams, and other sport

activities in exchange for visibility fronting public eye.

Most importantly, strategy should shift to fashion values since, empirically,

successful cases in shoes manufacturing industry experienced a trend not only in

improving technologies but also to satisfy diversified taste in fashion and mass

trends. Focusing on fashion does not necessarily mean sacrificing technological

simplicity and practicality of the product.

CONCLUSION

This paper extensively discusses about creativity, competition playing field and

different strategies of Geox to be highly competitive in shoes industry.

Recommendations are offered upon analyses. Geox is competitive brand on the

market and its strategic scheme and creativity in marketing field are paramount in

the long-term development of the brand itself to compete with other rivals. The focus

on technology and simplicity have been remained central; therefore marketing

strategies should be also address the unique strength of the range over other

companies’ counterparts.

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APPENDIX

Appendix 1

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Appendix 2

Appendix 3

Appendix 4

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Appendix 5Demographic

Age: All group age

Gender: male and female.

Family size: 1-2, 3-4, 5 above.

Family cycle: both married and unmarried.

Income: 3000 Australia dollar above per month

Occupation: white-collar and services worker, student

Education: School, colleges and Universities.

Religion: All.

Race: Australian and all people around the world.

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Appendix 6

References Amabile, TM. et al., 1996, Assessing the work environment for creativity, Academic of Management Journal, vol 39, pp. 1154-1184

Amabile, TM. et al., 1998, A Model of creativity and innovation in organisations, Reseach in Organisational Behaviour, vol.10, viewed 22nd March 2012, Greenwich Conn

Linda, M 2012, What is Creativity, Creativity at Work, viewed 21st March 2012, http://www.creativityatwork.com/what-is-creativity/

Jacob, G & David, M 2002, Creativity in Product Innovation, Cambrige University Press, United Kingdom, viewed 23rd March 2012, http://catdir.loc.gov/catdir/samples/cam033/2001018106.pdf

Clarks Shoes, 2012, viewed 15 March 2012, < http://www.clarks.co.uk/>

Nike, 2012, Nike Annual Report, Nike, viewed 19 March 2012, <http:

//www.nike.com.html.>

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