A Case study on Net-A-Porter.com

A Case study on Net-A-Porter.com
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Introduction and Background History
Sixteen years ago, the founder of Net-A-Porter Group, Natalie Massenet, picked up an "Are you an entrepreneur?" leaflet from a Barclays bank in London. She was certainly destined to be an entrepreneur. Before launching the Net-a-porter brand, she had plans for starting a chain of coffee shops, but business experts told her it wasn't worth it. Starbucks, in the subsequent months, came to hit the high street. "Natalie is so talented," says Christopher Bailey, chief creative officer of Burberry. "She has an incredible vision, which is proven in the way she has built her business online and been able to stay one step ahead of the competition. She's built a brand and a great team, and you can feel her incredible energy and personality in everything they do.'' (Wiseman, 2010)
The idea of Net-a-porter came about later when Massenet was trying to source products for a fashion shoot. She founded Net-a-Porter as a website in the form of a magazine in London. This business began from her home in Chelsea where Massenet and her husband raised a start-up capital of about £1.2million. She started the website at a time when shopping online was not trusted at all, but presently, e-commerce is the best place to do business efficiently. On the initial stages, the start-up was so low that the company's trademark black delivery boxes went to waste. This company has managed to establish itself as an excellent luxury brand with exquisite packaging and among the leading inefficient customer care. The Net-A-Porter.com website is presentable in a style of a fashion magazine, offering customers with guides of seasonal fashion trends.
Net-A-Porter Group is an online retailer of fashion apparel, designer clothing, and luxury-wear registered in New York. This company was founded in June 2000 by Natalie Massenet. She was born in 1965 to an American journalist turned film publicist Bob L. Rooney, in Los Angeles, California. Net-a-porter currently has 4.4 million users and with a global reach of over 170 countries. This company has become the world's premier online luxury fashion store, with sales of approximately £380m per annum, 2 million people as registered customers and over 2,600 of staff as by September 2013 in UK, U.S.A, and Hong Kong including fulfillment centers in some cities.
This company also created a discount fashion site, The Outnet and later, Natalie sold Net-a-Porter for an estimated £50 million, to Richemont; Swiss luxury goods holding company in 2010. She then remained as an executive chairperson and investor. Net-A-Porter also established an affiliate website, Mr. Porter, in 2011, for menswear. In 2014, it launched a print magazine, 'Porter', with an associated software application and digital version of the journal.
Millions of women view the editorial contents of this esteemed company on a monthly basis. Therefore, Net-a-Porter.com, as an expanding company with proper positioning in the market is fairly matured and prospective hence the basis of my case studies. This is because Net-A-Porter has played a significant role in revolutionizing and impacting on how people shop for fashion and high-end designer apparel from the comfort of their homes or workplaces.
INNOVATIONValuePropositionCompetitive strategyMarketing StrategyRevenue ModelValue Chain StructureGrowth StrategyTHE BUSINESS MODEL
Model of Corporate Entrepreneurship
Net-A-Porter employs the enabler model for its corporate activities which has helped both the employees and the management to facilitate entrepreneurial skills for the betterment of the company. This is to give independent funding, top executive attention, and new ideas to future directors and leaders of businesses. This company has dedicated funds towards innovation, flexible decision-making executive management, recruiting of inventive minds and also the development of the workforce that offers labor to the enterprise. This has helped cultivate the culture of innovation where laborers offer new concepts and ideas that are within the company's success framework. It has also rendered structural flexibility for employees' teams to pursue projects that will enhance innovativeness. Also, a well-defined involvement of the executive management in funding decisions within and out of the company to cater for the long-term future has been recommended. A clearly defined executive responsibility strategy has been put in place for milestone funding decisions. Lastly, a selection process and criteria of both brand and luxury apparel have been effectively communicated, the methods by which selection should happen and the pricing are efficient (Wolcott & Lippitz, 2007).
Competitive Strategy
Net-A-Porter faces direct competition from other online luxury retailers such as bluefly.com and shopbop.com. Also, it faces stiff competition from established e-commerce websites and luxury stores with the likes of Barneys New York, Saks Fifth Avenue and Bloomingdale's being among the higher contenders. These stores have entered the internet vehicle since there has been an increase in the demand for luxury goods and the target audience becoming bigger. Online sales are predicted to rise to about 20% globally in this year, whereby the market still accounts for 4.2 billion Euros out of the estimated 168 billion Euros value of the luxury sector. This market has received admirers and interest from brands offering luxury products such as Armani, Prada, and Dolce Gabbana, Miu Miu, Hennessy and Louis Vuitton among others that had previously doubted that market could be received so well online. A high number of luxury brands are set to break into the online market, whereby Net-A-Porter can expect fierce competition from these newbies. Net-A-Porter still retains the comparative advantage through its combination of fashion and magazine in a store; it still addresses the changing market structure. The growth plan of the company should restrict itself in diversifying and venturing into new markets while maintaining a firm grip on existing customers. The primary challenge is retaining its name as the premier online destination for luxury fashion in this vast market that is beginning to receive a lot of suitors.
Marketing Strategy
While it's unexpected for most online market sites to have the ability to develop an app, it's a good idea to embrace technology and tread on its path understanding where it is heading to have a rough map-out of where demand places their business. This study is going to outline the challenges Net-A-Porter faced during its launch and its continued growth due to coherent strategies of selling luxurious high-end products that result to its current position as one of the leading on line retailers. I am also going to shed light on the challenges this company faces shortly, to transform from being the pioneer mover in the industry to being among the players in the increased competition in the online market. It also suggests the strategies net-a-porter can employ to adapt to this ever-changing market.
Innovation
Same as to most successful companies, open innovation is greatly valued and achieved by Net-a-Porter. They fully know what happens when there is monotony in product procurement and the implications that can come as a result of avoiding change. This would significantly affect how the company interacts with customers in this digitally sensitized era. The company's initiatives have been bustled with the often emerging ideas and great growing and thriving technology circle, and this approach has become key to the ultimate success of the company.
Nowadays, apps have become more popular with the worldwide penetration of technology including smartphones and tablets going at a cheaper rate. This can be rendered as an evolution of a website. For Net-A- Porter, there is also a shopping interface created for seamless mobile shopping. This...