The Fashion Channel
The Fashion Channel: Case Write-Up
Decision to Be Made The management team for The Fashion Channel (TFC) must decide which customer segment(s) or “cluster” they should target in their new marketing strategy and how they should position TFC to ultimately increase company revenue. When deciding their marketing strategy, TFC must consider how they can increase their share of the market (ratings) versus the increasingly competitive fashion programming on CNN and Lifetime, and if they can maintain or increase TFC’s satisfaction level among the Large Multi-System Operators. According to Dana Wheeler, senior vice president of marketing for TFC, “the two key levers to drive revenue growth would be (1) increased viewership (ratings), and (2) increased advertising pricing.” Therefore, the scenario that The Fashion Channel will implement must increase TV ratings and advertising revenue. Relevant Facts Ratings One of the most important goals of The Fashion Channel’s new marketing plan was to improve their average rating compared to similar programming on CNN and Lifetime. According to Exhibit 1, TFC’s average rating was 1.0 (1.1 million households), while CNN and Lifetime enjoyed average ratings of 4.0 (4.4 million households) and 3.0 (3.3 million households) respectively. A major difference between The Fashion Channel and the other two networks is the time period of their programming. The main purpose of TFC is fashion and therefore programs around fashion 24 hours a day, 7 days a week. CNN and Lifetime, however, serve a larger purpose than fashion, and therefore only present programs dedicated to fashion Monday through Friday from 9-11pm (Lifetime) and Monday through Friday from 8-9pm and Saturday to Sunday from 10-11pm (CNN). Because they are not devoted to a specific niche, CNN and Lifetime have the opportunity to capture a larger audience that may have never looked for fashion programming if it
Decision to Be Made The management team for The Fashion Channel (TFC) must decide which customer segment(s) or “cluster” they should target in their new marketing strategy and how they should position TFC to ultimately increase company revenue. When deciding their marketing strategy, TFC must consider how they can increase their share of the market (ratings) versus the increasingly competitive fashion programming on CNN and Lifetime, and if they can maintain or increase TFC’s satisfaction level among the Large Multi-System Operators. According to Dana Wheeler, senior vice president of marketing for TFC, “the two key levers to drive revenue growth would be (1) increased viewership (ratings), and (2) increased advertising pricing.” Therefore, the scenario that The Fashion Channel will implement must increase TV ratings and advertising revenue. Relevant Facts Ratings One of the most important goals of The Fashion Channel’s new marketing plan was to improve their average rating compared to similar programming on CNN and Lifetime. According to Exhibit 1, TFC’s average rating was 1.0 (1.1 million households), while CNN and Lifetime enjoyed average ratings of 4.0 (4.4 million households) and 3.0 (3.3 million households) respectively. A major difference between The Fashion Channel and the other two networks is the time period of their programming. The main purpose of TFC is fashion and therefore programs around fashion 24 hours a day, 7 days a week. CNN and Lifetime, however, serve a larger purpose than fashion, and therefore only present programs dedicated to fashion Monday through Friday from 9-11pm (Lifetime) and Monday through Friday from 8-9pm and Saturday to Sunday from 10-11pm (CNN). Because they are not devoted to a specific niche, CNN and Lifetime have the opportunity to capture a larger audience that may have never looked for fashion programming if it