ThisinformationisconfidentialandwaspreparedbyBain&Companysolelyfortheuseofourclient;itisnottobereliedonbyany3rdpartywithoutBain'spriorwrittenconsentFuelingFutureGrowthforApparelCo.EcommerceStrategyApril,2015ApparelCo.ThisinformationisconfidentialandwaspreparedbyBain&Companysolelyfortheuseofourclient;itisnottobereliedonbyany3rdpartywithoutBain'spriorwrittenconsent22015BainCaseCompetition-Fir...HKGCasebackgroundandnextsteps(1/3)•Welcometothe2015Baincasecompetition!•YourteamhasbeeninvitedbytheStrategyDirectorofApparelCo.toparticipateinapre-discussiononApparelCo.’secommercestrategyinChinaforthenext5years.ThequalityofyourproposalandpresentationwilldeterminewhetheryoucangettothediscussionwithCEOonapotential3-monthconsultingproject•ApparelCo.isaleadingChineseapparelcompanyengaginginthewholevaluechain:design,manufactureandsales.Ithasmultiplegarmentbrandswithdifferentbrandpositioning(seebelow).•Allaremainlysoldthroughphysicalchannels-bothcompanyownedandfranchisestores,althoughtheyhavealsostartedusingtheonlineplatformtoalimiteddegree.•Inthepast2years,toplinegrowthhassloweddown.Asthecurrentmanagementhavelittleonlineexpertiseorinterest,theCEOandStrategyDirectorarelookingforsomehelptoassessonlineplatformasapotentiallevertodrivefuturegrowth.Brand1Brand2Brand3Brand…High-endbusinessformalYoungandtrendycasualBusinesscasualThisinformationisconfidentialandwaspreparedbyBain&Companysolelyfortheuseofourclient;itisnottobereliedonbyany3rdpartywithoutBain'spriorwrittenconsent32015BainCaseCompetition-Fir...HKGCasebackgroundandnextsteps(2/3)•Toprepareforthediscussion,yourteamneedtothinkthroughthesequestions:-WhatarethedemographicsprofileofthetargetconsumersandvaluepropositionsforApparelCo.’sbrandsrespectively?-Whatisthestatusquoofofflinebusinessandhowwillonlinebusinessaffectofflinebusiness?•Basedonyourunderstandingofthetwoquestionsabove,theStrategyDirectorexpectsyoutomakerecommendationonthebreadthanddepthofonlineoperation:-Whichbrand(s)shouldgoonline?-Alongthecustomerjourney,whatkindofinitiative(s)shouldbedoneonlinetofulfilcustomerneeds?•Youteamneedtotellacompellingstorysupportedbyrobustdataandanalyses•ThisproposalisduebyendofdayMay4th,andyoumaybeaskedtopresentthesematerialstoStrategyDirectorinthefollowingweek•Toensurethatyourpresentationhitsthemostimportantpointsandis“communicating-for-results”,youhaveagreedwiththeStrategyDirectorthat-Maximum15slidesforthepresentation(notincludingagendapagesoradditionaldataanalysesinbackupmaterials)-Minimum26fontsizeforslidetaglines;minimum14fontsizeformainbodytext;minimum3charts/graphsonaslide-AllpagesshouldbeeasytoreadandunderstandforaudiencewithageneralbackgroundThisinformationisconfidentialandwaspreparedbyBain&Companysolelyfortheuseofourclient;itisnottobereliedonbyany3rdpartywithoutBain'spriorwrittenconsent42015BainCaseCompetition-Fir...HKGCasebackgroundandnextsteps(3/3)•Toseta“PointofDeparture”,yourteamcaneitherchooseanexistingapparelplayerwithbrandportfolioandsaleschannelsimilartotheonedescribedbefore(forexample,Youngor,Baoxiniao,Lancy,Anzheng,etc.)asthehypotheticalclient,orassumeanonexistentplayerwithsimilarcharacteristics•Tohelpyouquicklygetup-to-speed,theStrategyDirectorhaskindlysharedsomereferencematerials.Althoughsomeofthesematerialsmaybeoutdated,he/shebelievesthatyourteamwillbeabletogatherotherinterestingandpowerfulinformationfrompubliclyavailablesources(e.g.companyannualreports,analystreports,businessnews)orprimaryresearchtosupportyouranalysisandrecommendationGoodluck!ThisinformationisconfidentialandwaspreparedbyBain&Companysolelyfortheuseofourclient;itisnottobereliedonbyany3rdpartywithoutBain'spriorwrittenconsent52015BainCaseCompetition-Fir...HKGReferenceMaterials•ChinaapparelecommercetrendsThisinformationisconfidentialandwaspreparedbyBain&Companysolelyfortheuseofourclient;itisnottobereliedonbyany3rdpartywithoutBain'spriorwrittenconsent62015BainCaseCompetition-Fir...HKGChinadigitalretailmarkethasbecome#2intheworldin2012,andexpectedtoexceedUSin2013Note:ExchangerateRMB/USD:6.8(2009),6.3(2012),6.1(2015F)Source:iResearch;Euromonitor;expertinterviews;Bainanalysis…ANDISEXPECTEDTOREACHRMB3TIN2015,DRIVENBYB2CCHINAHASBECOMETHENO.2INGLOBALDIGITALRETAILMARKET…ChinaisexpectedtoovertakeU.S.tobeno.1in2013ThisinformationisconfidentialandwaspreparedbyBain&Companysolelyfortheuseofourclient;itisnottobereliedonbyany3rdpartywithoutBain'spriorwrittenconsent72015BainCaseCompetition-Fir...HKGLowerpriceisstatedasthesinglemostimportantreasonthatdrivesconsumerstoshoponline…“Whydoyoubuyonline?”Source:Bain2013digitalshoppersurvey(n=1324)ThisinformationisconfidentialandwaspreparedbyBain&Companysolelyfortheuseofourclient;itisnottobereliedonbyany3rdpartywithoutBain'spriorwrittenconsent82015BainCaseCompetition-Fir...HKGMostpreferbrick&mortarplayers’e-storesoverpureplayers’;touch&feelinstoresisthekeydriver“Doyoupreferpureonlineshoppingwebsiteore-storeofabrick&mortarplayer?”“Whydoyouprefere-storeofabrick&mortarplayer?”Source:Bain2013digitalshoppersurvey(n=1324)ThisinformationisconfidentialandwaspreparedbyBain&Companyso