Case Nundies

Case Nundies

I. Summary and problem formulation

“Panty lines are the ultimate fashion faux pas!”

Ultra thin nylon-and-Lycra liner for women who dislike panty lines and do not like to wear thongs or underwear.

Introduced in 2006, in 2007 it was available in 232 women’s boutique and specialty shops and 10 Neiman Marcus department stores in 40 states, as well as online.

Success getting Nundies in stores and distribution channels, but want to get them “off the rack” now.

11,383 units sold (1 unit = package of 5 liners). Store repurchase rate did not meet expectations, only 6% of stores placed orders for additional units. (Indication of bad Performance / low brand recognition?)

Reorders represented 10% of total units sold to retailers through December 2007.

Launch program for nundies had : yielded considerable publicity, stimulated store buyer interest, and prompted store decisions to stock and display the product. But believed new initiatives necessary to bolster unit volume and especially REORDER.

⇒ Revist market and sales potential (market feasibility) for Nundies and propose strategy necessary to realize this potential (distribution feasibility), including the expected sales and profit impact of these initiatives in 2008 for budgeting purposes (financial feasibility).

II. Factual contextualization and overview

Advanced Materials, INC. – Texas based company, manufactures variety of products (technological strategic differentiation) – aerospace, consumer, technology, automotive, medical. Important to leverage this in marketing?

In 2003 , shift of strategic focus : want to brand its own products and convert its product development capabilities into consumer-based solutions primarily for the medical and consumer market.

Launch of Nundies was “a huge departure” – innovative and thinking outside the box.

Product Development

2006 – idea for single-use disposable panty that sticks to women’s inseam surfaced.

Consumer Research (Market Feasibility) – Most women hate panty lines but want to maintain a degree of protection while “going commando”.

Nundies = best of both worlds, and high grade medical grade product (no allergies).

Product information: 1 package cost 0.60$*5 + 0.45$ = 3.45$

III. Nundies Market Research – Market Feasibility Assessment

Market size U.S: Women 18+ spend $16 Billion annually for underwear

Segmented : 52% panties, 30% thongs 14% boyshorts 4% other. = These products account for Quarter of total women’s underwear retail sales in US. ⇒ Market size ~ 4B $ + 6% no underwear at all. → Out of which 81% are interested in novel solution that is not panties and provides hygiene and comfort benefits → Market size for Nundies = 6*= 4.86 B

6% prefer no underwear at all.

Survey Research :

1. 84% interested in product that eliminates panty lines (16% not interested)

2. Have tried (brand awareness) –

a. No-seam panties (substitutes to nundies) 58%

b. Thongs 48%

c. Panty smoothers 12%

d. No panties 22%

3. 81% (interested in novel solution that is not panties (desirability is high) – only 19% not interested. BUT – that is not the real interest in NUNDIES.

4. Interested in Nundies? – 36% yes, 41% maybe , 23% no - ~ 0.36 + 0.41/2 = 56.5% have a buying intention? Roughly 60% of total sales ($4 Bil) is the Market size for nundies to pursue unless they tweak their product line (ex. Non-disposable line? → Could achieve 0.84% of market that is “interested in novel solution that eliminates markings and is not panties thongs etc)

5. Out of the women who said yes (36%) – “Would you actively seek out this product if you knew it was for sale at your favorite store” – 28% yes, 49% no (lowish purchase intention)

6. Usage question : out of those who said yes previously (28% of the 36% = 10.08% of total population) – 29% [1-2 times /week] , 35% [3-5 times]