Denim Blues
Levi Strauss is a name that most
Americans recognize. They usually
relate the brand to "jeans" or levis.
Changes in trends and consumer
preferences forced Levi Strauss to
diversify its product lines over many
years. In fact, at one time the company had
over 65,000 different products on the market. Over
the past six years, Levi's has seen it sales volume
decrease by 40%. With the first three months after
9/11/2001, Levi's was down a whopping 12% in
sales. Further, Levi's management perceives its marketing
plan as consistent with the research data. Outside
industry experts disagree, however. There was a
time not long ago when Levi's would introduce mass
produced trendy jean wear (at around $30) and
simultaneously attempt to market high-end products
to an entirely different market segment. In a sense,
Levi's was trying to be all things to all consumers at
the same time. Based on this and other examples,
industry experts suggest that Levi's must segment the
market and target their segments more directly and
carefully if they are to return to profitability.
High labor and production costs and the need to
respond rapidly to changes in the marketplace have
forced Levis' to locate all of its manufacturing facilities
outside of the U.S. The company has reduced the
number of products it sells from 65,000 to 20,000.
While Levi Strauss is a 4.2 billion dollar firm, it needs
to find a way to define its customer more clearly, target
that market, and continue reducing costs as it has
recently. While Levis may no longer be manufactured
in the United States, it may remain an American
icon nevertheless.
Discussion Questions
The chapter discusses the hierarchy of authority.
How does this concept relate to Levi Strauss?
What qualities does Levi Strauss have that may
ensure continued success in business?
How does the video segment relate to the evolution
of capitalism as discussed in the text?
