Giordano: Positioning for

International Expansion

McGraw-Hill/Irwin

Case 4-1
Case

Copyright 2009 by The McGraw-Hill Companies, Inc. All rights reserved.

Objectives for Case 4:

Giordano

Case 4-2

To illustrate how marketing strategy and

competitive positioning must be aligned with
human resource and operations strategies in
service businesses.
To explore the sustainability and transferability of
key success factors into new markets.
To explore the tradeoffs in service vs. value-formoney as sustainable competitive advantages.

Case 4-3

Giordano Financial Highlights

Case 4-4

Typical Giordano Storefront

Selected Awards Giordano Received

Over the Years

Case 4-5

Case 4-6

Typical Store Layout

Market Positioning of Giordano and

Principal Competitors

Case 4-7

Case 4-8

Geographic Presence of Giordano and Its

Principal Competitors

Case 4-9

Competitive Financial Data for Giordano,

The Gap, Esprit, Bossini and Theme

Operational Highlights for Giordanos

Retail and Distribution Division

Case 4-10

Case 4-11

Giordano - Background
Established in 1981, headquartered in Hong Kong
Over 1700 shops:
in 30 countries mostly in Asia and Middle East
11,000 employees
first store in North America opened in 2007

Increasing sales and profits year-to-year:

sales up 15% in first half of 2007 over the same period a year earlier

Core values:
quality, knowledge, innovation, service, simplicity

Four brands: Giordano, Giordano Ladies, Giordano Junior

and Bluestar
Giordano Concepts added in 2006

Wall Street Journal Asia Innovativeness Award in 2007 for

customer orientation

Case 4-12

Giordano Case Situation

The company is differentiated by its value
for money and high level of quality service

Giordanos key success factors

focus on customer needs
sophisticated information systems and logistics
strong marketing and advertising
commitment to service
simplicity and focus

Case 4-13

Case Analysis Group Discussion

Describe and evaluate Giordanos product,
business, and corporate strategies.
Describe and evaluate Giordanos current
positioning strategy. Should Giordano reposition
itself against its competitors in its current and new
markets, and should it have different positioning
strategies for different geographic markets?
What are Giordanos key success factors and
sources of competitive advantage? Are its
competitive advantages sustainable, and how
would they develop in the future?

Case 4-14

Case Analysis Group Discussion

Can Giordano transfer its key success factors to
new markets as it expands both in Asia and in
other parts of the world?

How do you think Giordano had/would have to

adapt its marketing and operations strategies and
tactics when entering and penetrating your
country?
What general lessons can major clothing retailers
in your country learn from Giordano?

Case 4-15

Case Analysis Group Discussion

How are the companys service strategies (e.g.,
people process, physical evidence) linked to its
market position? In other words, how does
Giordano align its service design and positioning
with customer expectations?
Can Giordano sustain its focus on high quality
service and value-for-money as it grows? In your
opinion, which strategy provides the greater
sustainable competitive advantage?

Case 4-16

Case Analysis Group Discussion

Giordanos Market Position:
Value for Money
High Level of Quality Service
How do they achieve this strategy? What
specifically do they do with respect to
people, process, and physical evidence?

Case 4-17

Case Analysis Group Discussion

People Strategies
recruiting employees to match service profile
training for attitude
224 hours/year of training

empowerment
employees are given freedom to make decisions for
customers at the point of sale

performance incentives related to customers

and service
service standards measured frequently; service
is rewarded

Case 4-18

Case Analysis Group Discussion

Process Strategies
customer-oriented in-store practices
no time limits; unlimited try-ons; easy returns

flat organizational structure

easy and quick communication with customers
quick decisions on new products based on customer
needs

convenient for customers

sophisticated technology and information
products always in stock

Case 4-19

Case Analysis Group Discussion

Physical Evidence Strategies
simplicity in store layout
focused product selection
100 total items in stores; 17 core products

stores are well-stocked

pleasant, clean, simple design

Case 4-20

Giordano Stores Worldwide

Shanghai
Los Angeles

Case 4-21

Case Analysis Group Discussion

Can Giordano sustain its focus on high
quality service and value-for-money as it
grows?
In your opinion, which strategy provides the
greater sustainable competitive advantage?

Case 4-22

Quality Service or Value-for-Money?

The combined strategy provides clear
differentiation
more competition if they just pursue one or the
other
however, the dual strategy is challenging

High quality service is difficult to imitate and

thus serves as a sustainable competitive
advantage
especially when combined with value for money

Key Success Factors Are They

Transferable?

Case 4-23

Focus on customer needs

yes, this can be transferred

Sophisticated information systems and logistics

yes, but many are doing this now so it is perhaps not a
clear differentiator as it was before

Strong marketing and advertising

yes, within Asia
outside Asia this is more difficult as there is more
competition
will require adaptation and tailoring outside of Asia

Key Success Factors Are They

Transferable?
Commitment to service
yes, although definitions of service can be quite
different

Simplicity and Focus

yes, but this may have different meanings across
cultures

Case 4-24

Case 4-25

Key Challenges in Expanding Globally

Consumer tastes and expectations differ
Service standards will need to customize
to fit the culture
Training and recruiting service-oriented staff
will be crucial
Competition is very strong in some countries
(e.g., U.S., Canada, Europe)
Technology as a differentiator is not likely to
be sustainable

Case 4-26

Provider Gap 1
CUSTOMER
Expected
Service

COMPANY

Listening
Gap
Company
Perceptions of
Consumer
Expectations

Part 3 Opener

Case 4-27

Key Factors Leading to Provider Gap 1

Case 4-28

Giordano - Conclusion

The case illustrates how one company matches its service

design with its customer expectations and how that
strategy can be implemented and adapted as it grows
The case illustrates the critical importance of operational
and human resource strategies in being an excellent
service provider
The case also shows the challenges of determining which
key success factors are sustainable and which may need to
be adapted and changed, particularly with global expansion