Aim: During the second quarter of 2008, e-commerce increased with 21,1% compared to the same period 2007. The most popular products were books, cd’s, clothes and electronics. The reason why the turnover kept increasing for e-commerce while the traditional market was facing an unstable period was the new solutions possible on the web. Because of this structural change regarding e-commerce I found it an interesting case for a thesis. The subject for this study was a small company providing socks through the web, www.Onepair.se. The overall aim was to develop a marketing plan for the company. Research questions that are part of this aim are listed below.
- Investigate the consumer’s opinion about the company and the product.
- Study the distribution channel, e-commerce.
- Analyse the product and the competitive situation.
Method: Most of the information is primary data from an interview with the founder of Onepair and from a survey with potential customers. Information from personal interview with the founder is qualitative whereas information from the questionnaire is qualitative and quantitative (numeric). There are also secondary data collected from the web and articles/literature.
Result & Conclusions: Onepair mentioned quality, price and service as key features for the product. In the survey performed among potential customers, 49% of the participants thought that price was more important than both quality and design when buying socks. 33% thought that quality was most important whereas 18% put the design as the most important. Regarding the price for socks at onepair.se, 69% out of 161 participants thought the price was acceptable and 21% thought it was in the lower region. The competitor analysis showed that the price for socks from Onepair was well within the span comparing with competitors. With this information together, I think that the prices could be slightly higher. Quality is as mentioned above difficult to analyse for this product as the usage is different from person to person. As long as the price could be kept at a reasonable level I think it is worth to put some extra effort on quality. The reputation of having “bad-quality-socks” may be difficult to get rid of.
Even though quality of the service at Onepair was not measured, their intension of delivery within 24 hours showed to be added value for the customer according to an e-barometer performed by Posten and HUI (Handelns utredningsinstitut). Among 1000 respondents in the “e-barometer”, 66% thought that a fast delivery was most important regarding the delivery when using e-commerce.
The distribution channel Onepair has chosen seems to be right if looking at trends from the “e-barometer”. As much as 81% of 1000 consumers thought they would use e-commerce within the coming six months. The same trend was shown in the survey used in this study where 79% of 161 consumers said they would use e-commerce.
If comparing Onepair with competitors, the company is not outstanding concerning any of the features discussed. One way they have differentiated themselves is by selling only socks. Many of the competitors are selling underwear and other clothes as well. Another feature that may attract customers is the combination of a reasonable price with a wide assortment. To be more differentiated I think there is a need for more marketing.