Gymshark's UK Market Entry: A Marketing Plan Report

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The Marketing Plan –Gymshark
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Executive Summary
The report is based on the marketing plan of Gymshark, which the company is going to
implement in the market of the UK. The report includes an analysis of the external market and
internal factors of Gymshark. The SWOT Analysis discusses the Strengths and Weaknesses of
the company and gives an overview of the external Opportunities and Threats. The PESTLE
Analysis explains the external factors, which may affect the company while working in the
country. On the other hand, the Porters Five Forces discusses several factors related to its
competitors and how to tackle those. Finally, the 4Ps marketing mix, tells us the strengths
Gymshark has which it should utilize in marketing its products and the weaknesses it has to work
on. Some internal issues are also mentioned. Based on the analyses, three marketing objectives
are formed, which helps in making marketing strategies of Gymshark. The company should
expand itself in other countries to spread its business. Moreover, it can open new physical stores
in some of the cities as well. Along with that, employing an increased number of employees will
help it to maintain the business well. Apart from that the future planning team will help it to
foresee the future possibilities and presopsre the company accordingly.
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Table of Contents
Introduction......................................................................................................................................5
PESTLE Analysis............................................................................................................................5
Political........................................................................................................................................5
Economic.....................................................................................................................................6
Social...........................................................................................................................................6
Technological..............................................................................................................................7
Legal............................................................................................................................................7
Environmental..............................................................................................................................7
Porters Five Forces Analysis...........................................................................................................8
Competitive Rivalry.....................................................................................................................8
Threats of New Entrants..............................................................................................................8
Threat of Substitution..................................................................................................................8
Power of Customers.....................................................................................................................9
Power of Suppliers.......................................................................................................................9
Internal Issues..................................................................................................................................9
SWOT Analysis.............................................................................................................................10
Strengths....................................................................................................................................10
Weaknesses................................................................................................................................10
Opportunities.............................................................................................................................11
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Threats.......................................................................................................................................11
Marketing Objectives.....................................................................................................................11
Marketing Strategy........................................................................................................................12
Marketing Mix (4Ps)......................................................................................................................12
Products.....................................................................................................................................12
Pricing........................................................................................................................................13
Place...........................................................................................................................................13
Promotions.................................................................................................................................13
Conclusion.....................................................................................................................................13
References......................................................................................................................................14
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Introduction
Gymshark, which is planning to operate in the sportswear market of the UK, needs to do a
market analysis. To do that, it had done a PESTLE Analysis of the UK market and to understand
its internal strengths and external opportunities the SWOT Analysis of Gymshark is done (Juhlin,
and Soini, 2018). Porter’s Five Forces Analysis gives a clear view of the competition it has to
face from its rivals and how to mitigate it and grow in the market. Based on the SWOT analysis,
some market objectives are formed along with market strategy. Finally, the Marketing Mix gives
the 4Ps of the company. All these analyses will help Gymshark plan for the entry and the way of
operation in the UK market.
PESTLE Analysis
The PESTLE Analysis of a company gives an idea about the factors, which is not under the
control of the company and is considered as the external factors. However, these factors can
affect the company and its operations. By understanding these factors in advance, a company is
able to get ready to face the problems, which are likely to occur. These steps, in turn, will reduce
the future risk of the company. In the same way, it is necessary to study the PESTLE of
Gymshark to understand the external factors affecting the growth of the company.
Political
There are certain political factors which affect the operations of an organization. In the case of
Gymshark, political influence is greater. The products, which it imported earlier, is facing
problem due to Brexit and different rules, which came into action due to that. The actions taken
by the political parties are good for the physical health of the people of the country (Haemers,
2016). These steps, in turn, are increasing the health consciousness among the citizen and they
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are getting more interested in sports, which is why the interest in sports apparel brands is
increasing. However, the trade restriction with other countries is putting a limit to the business.
Economic
Every country has an economic status, which is the determinant of the price of the items, which
are sold in that country. The leisure items made and sold in the country are highly impacted by
the economy and the laws related to it. Gymshark similarly faces some economic restriction in
the UK. On the other hand, the mindset of people and health habits are also a great determinant
of the sales of sports-related items. In the present, people are becoming more health conscious
due to the increasing number of obese people, who are trying to get healthy and back in shape.
These kinds of people include children too. Due to all these reasons more people are heading to
the gym and getting memberships there, which in turn is increasing the need for sportswear and
gym wear. This factor is increasing the sale of the gym apparels, which includes Gymshark as
well.
Social
The use of social media is increasing, and the speed at which news used to spread had become
faster. That is why people get to know about the items they need and any information related to
it, which gives the brands related to it, an increased value. Gymshark takes help of social media
to spread the brand name, by taking famous personalities as their brand ambassador (Hermansen,
2018). They do all the advertisements based on the customers they want to target and keep in
mind the demographics of the place they are working in. However, the average income of the
place where Gymshark is operating is one of the greatest influencers if the sales of their brand’s
sportswear.
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Technological
Like other brands which are keeping up with the change of the world, Gymshark is also
incorporating the latest technologies in its work to improve the customer’s experience. The latest
way of e-commerce using smartphones is also included in their technological advancement,
along with the use of artificial intelligence. Apart from that experiments is going on to integrate
technology directly in the clothing items or the fibers as well.
Legal
The legal factors, which are the direct influencer to the brand, are the intellectual property and
design patenting, and Gymshark makes sure to keep its employees completely aware of it.
Whenever contracts are made with celebrities and sponsorship is offered, the whole process must
be done legally (Barly Lindbo, Galouk, and Susa, 2018). Apart from that, every employee must
maintain proper hygiene related to the clothing item, and the employers must make sure they
maintain fair labor value. The safety standards must be maintained within the organization and
by the suppliers of Gymshark.
Environmental
Gymshark makes sure to make its items and the packaging as environment-friendly as possible.
Along with that, they maintain proper hygiene within the company to make waste disposal safe
and harmless. Gymshark also uses different types of fabrics, which are made of organic products
by Eco manufacturers, and after the fabrics are chosen, the color of the fabric is done using
organic materials.
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Porters Five Forces Analysis
Porter’s five forces analysis gives Gymshark a better understanding of the competitive forces
present in the market, and which could come in the near future. By finding the causes behind the
forces the way Gymshark can increase its profitability, is mentioned too.
Competitive Rivalry
In the UK, sports are taken very seriously and so many sports apparel companies had sprung up
in the market. Apart from that, Nike, Under Armour, Adidas, etc. are already leading in this
market. That is why, smaller companies like Gymshark has to find out its own niche, which it
can exploit, and by doing so it had created a solid foundation for itself in the UK sportswear
market. However, it must keep an eye on its rivals who create similar products to stay ahead of
it.
Threats of New Entrants
With the popularity of social media, launching a new company and entering a market had
become easier for smaller companies, without investing in human capital or spending too much
money (Li and et al., 2015). These platforms give easy exposure to the companies, where they
can find their own niche and start operating there. However, other smaller companies are also
entering the market, so competition is quite high.
Threat of Substitution
The UK sportswear market is nearly saturated and it is hard for any new entrants to make any
mark. However, competitors can bring similar products or offer products at a lesser price, which
could take away the customers of Gymshark easily. To fight against it, Gymshark focuses more
on the demands and trends of the people who actually heads to the gym regularly. Based on that
they plan their pricing which reduces their threat of substitution.
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Power of Customers
The customers have the highest power, which determines the future of a company because a
huge number of choices are available in front of them, from which they can choose any better
option which offers the same kind of product at a lower price (Lagnese, 2017). To attract
customers towards it, Gymshark must create such kind of products, which help to build
recognition, and the customers feel associated with the brand. This association through social
media can help in influencing the customers further.
Power of Suppliers
The apparel industry is such that the supplier of the raw material and products are so many, that
the market is oversaturated. That is why, when a supplier demands too much price, they can be
easily replaced by other suppliers, who will offer the same things at a lesser price, with the same
quality.
Internal Issues
Some internal issues are needed to be solved along with external factors. However, the size of
the company is too small in the present and it has employees, which are less than 200 in total.
However, most of the employees here are very young and their age is below or around 30. This is
a small problem, which needs to be solved, and that is why they have more than a hundred
vacancies in the present for which they need talented people, who will best suit the posts.
Gymshark is filling in those vacancies and increasing the number of posts (Ansari, Zhang, and
Preedanon, 2016). However, due to lack of physical stores, they do not have a proper
headquarter and they are thinking to acquire the old Vodafone Headquarter and renovate it. They
worry that they face is not for the present because whatever resources they have is best for the
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present. However, they think about how they can stay at the top in the future too. For that, they
need a team, which could foresee the future and help the company get ready to face it.
SWOT Analysis
SWOT Analysis of Gymshark will give a clear perspective about the internal strengths and
weaknesses and the external opportunities and threats of the company.
Strengths
Gymshark has numerous strengths, which it can use to improve its business. The brand name is
recognized by the people of the UK where it is operating, which is helping it to increase its sales
every year, and helped it to become the fastest growing sportswear brand in the UK in the recent
years (Breuer, and Kaiser, 2015). It has a strong presence in the social media sites, where their
advertisements are showcased, which keeps the users updated about the items and offers they are
giving. They offer a fast transfer of money through their efficient electronic fund transfer
capability. As their manufacturing is outsourced, it automatically brings down the manufacturing
costs of the items.
Weaknesses
There are some weaknesses of Gymshark, in which it needs to improve itself. However,
Gymshark is working on it but is still not able to bring in the market a mobile phone application
which will make the whole shopping experience easier for the customers. Gymshark’s delivery
cost is higher than its competitors, which they must work on to bring them down. It only offers
its products and services through online platforms, which is why not every age group like
children and elderly are aware of it. The team of the Gymshark is not so mature to handle the
increased pressure.
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Opportunities
Gymshark can make use of the latest technologies like Artificial Intelligence and introduce
Chatbots which will improve the customer experience. As mentioned above, Gymshark’s
products are only available through the online platform, which is why it can think of extending
its business by opening physical stories as well (Kaiser, and Breuer, 2015). Apart from that, it
can think of expanding itself by entering new emerging markets. In this age of technology, it can
also bring such technologies in the market, which are wearable that will give it an edge over its
competitors.
Threats
The market is competitive, not just locally but globally as well. That is why similar items are
being introduced in the market by similar business companies, which can be a threat to
Gymshark. Due to the huge step of Brexit the whole market and the business of the UK are
hugely affected, and so is Gymshark. That is because it brought economic uncertainty among the
business companies.
Marketing Objectives
Based on the SWOT Analysis, some marketing objectives of Gymshark can be formed. These
objectives will help Gymshark grow its business further and take over an increased amount of
market share in the sports apparel industry. The marketing objectives thus made follows the
SMART criteria. The objectives are-
 To increase the market share in the sports apparel and gym wear industry.
 To help the business grow not just in the country but also globally, and not only in the
virtual platform but also in the physical market.
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 To be future ready to face the problem which is likely to occur by increasing the number
of employees.
Marketing Strategy
The marketing strategy, which Gymshark follows, is based on the Segmentation, Targeting, and
Positioning of the market. This includes a set of a framework that brings together all the
segments of the market and analyze them. This tool helps the company to divide the customers
into groups based on different variables, like region, income per capita, financial status, etc.
Gymshark mainly uses the demographic segmentation, and the criteria under it are the age,
income, gender, occupation, family size, etc. Gymshark target the young people by
differentiating them, and choosing the age group of 18 to 25, who are most interested in fitness,
and fashion along with the music (Sadr, and Hosseini, 2016). The income of the family must be
over $20,000 and they must belong to the managerial post or senior or junior executives of a
company. The mindset of the people who select these are the people who want to keep a proper
balked between work and life, and want fun and excitement in technologically advanced ways.
The gym wear of Gymshark are cool and comfortable which helps the wearer perform to their
ultimate capability, and the producer range varies from men to women and accessories. The
pricing they had set for the products gives the brand a higher position in the market. The
products are divided into four groups, which are high performance, lifestyle, limited edition, and
wide selection.
Marketing Mix (4Ps)
The 4Ps of marketing mix are products, pricing, place and promotions.
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