Contemporary Ti Design
Market Analysis Summary
Contemporary Ti Design will be focusing on two distinct groups of customers. One is the end consumer, the other is galleries, to be used as a distribution channel. The end consumer will be interacting with Steve via his website as well as through personal contact at exhibitions/shows. The galleries (museum shops, jewelry stores) will also be met through the exhibitions and shows. At these events a long term relationship will be entered into so that the shops become a retail distribution channel for Contemporary Ti Design. Additionally, Contemporary Ti Design will be traveling the country meeting with different galleries and setting up retailing relationships with them.
4.1 Market Segmentation
Contemporary Ti Design has two targeted groups of people, galleries and individuals:
- Galleries- These buyers are purchasing jewelry wholesale in quantity and reselling it to the public. Some of the galleries are private galleries, some are artisan jewelry shops, some are museum stores, like the Smithsonian Hirschorn Museum of Modern Art Store. The margins are not as good compared to sales to individuals and there is also the expense of setting up relationships with the galleries to sell the art pieces, but galleries move a large quantity of work. The galleries and stores that typically are interested in Contemporary’s work are more upscale and modern. They appeal to a crowd that favors progressive or industrial design.
- Individuals- These buyers are familiar with Contemporary Ti Design either from stumbling across the website, saw some examples of Steve’s work at a showing or art festival, word of mouth, or some other avenue. The individual would then view the different available pieces on the website and place the order via the Web, phone, fax, or mail. The margins for individual sales are greater because there is not a distribution layer involved, it is direct from Contemporary Ti Design to the end consumer. The individuals that are typically attracted to this type of art work are generally from cities and are fairly progressive. The reason for this is that the jewelry, while not flashy, is not all that conservative looking. They are intricate pieces, typically using organic shapes and industrial design. This is the reason that more progressive people will appreciate the Contemporary Ti Design pieces.
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4.2 Target Market Segment Strategy
Contemporary Ti Design is targeting galleries and individuals because they are the most likely purchasers of the jewelry. Galleries typically purchase works of art from many different artisans. The galleries will first come into contact with Contemporary through examples of the work at an exhibition, or the retailer is contacted by Steve (or sales rep) and shown samples. If there is interest, the gallery will place an order for a few representative pieces. This is hopefully the beginning of a long-term relationship where the gallery will then reorder more pieces to replenish their stock as well as to hopefully broaden their product offering.
Contemporary’s target segment strategy for the individuals will also be based on exhibitions. The individual will see examples of Steve’s work and either purchase the product right then, or will be referred to the website where a complete product listing is available and all pieces are sold. Additionally, individuals will come across our website, either from a referral or a targeted Web search. The individual is able to make a purchase, or find out what galleries carry Contemporary’s pieces to view them in person.
4.3 Industry Analysis
The jewelry industry, or even broader the art industry, is quite large and diverse. There are countless different artisans making so many different pieces of work. There are artists from every state that manufacture products. Some sell to large department stores, some to galleries, some sell them only via a website, others will travel with the products and sell what they are carrying.
4.3.1 Competition and Buying Patterns
As previously stated, the jewelry industry is composed of thousand upon thousands of people. Some work and distribute locally, others have national distribution systems set up. Some artists will design products for larger companies to manufacture, others will design and make the pieces themselves. This business plan will have an abridged competition section. This is because of the very large and distributed nature of artisan jewelry design, the market is entirely too dispersed to have a complete catalog of the competition.
Competition does take the following forms:
- Artists creating designs that are then manufactured on a large scale and distributed nationally. The artists might be famous enough to have their own one-name studio that they create designs and the product is made and sold under the larger companies name. If the artist does not have national name recognition, the designers might belong to a firm that is hired to develop designs for a company who will manufacture and sell the product.
- A company that has their own designers in-house. In this case everything is done in-house, design, marketing and wholesaling. Another variation would be in-house designers, marketers and wholesalers with the manufacturing contracted out.
- Artists such as Steve who design and make all of the pieces themselves, and then do the wholesaling or retailing themselves.
The buying patterns of consumers fall into typically two types: gifts and impulse purchases. A gift purchase occurs when the buyer is looking for a gift for someone, sees the art piece, and then purchases it. In this case the plan is to make a purchase, it is just not known what or where that purchase will be made. The other buying pattern is an impulse purchase. Someone will be shopping, they are not in need of anything, will see the item and have to have it, buying it on the spot. One last pattern, that occurs less frequently is if someone was looking for an “accessory” that would match an outfit and happens to come across the piece of jewelry and buys it.