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Removed student name
Instructor: Cyn Roberts
BA241: Principles of Marketing
August 16th, 2010
Marketing Audit: Flake E. Designs
1. Table of Contents:
Page 1.
2. Thesis Statement:
page 2.
3. Company History and Executive Summary:
page 2.
4. Marketing Mix: (Four P's)
• Product:
• Price:
• Place:
• Promotion:
5. Environmental Analysis
• Introduction:
• Cultural Environment:
• Competitive Environment:
• Technological Environment:
page 3.
page 3.
page 4.
page 4.
page 5.
page 6.
page 7.
page 8.
6. SWOT Analysis:
page 9.
• SWOT Matrix Chart :
page 9.
• SWOT Discussion: Internal/External Factors: page 9, 10.
7. Conclusion:
page 10.
8. Works Cited:
page 11.
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2. Thesis Statement:
When the option of a startup company was presented for this audit, the decision to choose the
Portland-based clothing company, Flake E. Designs was obvious. Although knowing the CEO would be
beneficial regarding information gathering, my biggest reason for choosing Flake E. is that I truly believe
in what their global mission statement stands for as well as and what they have set out to accomplish.
(XXX, I recommend that you work on introductions that are not so personal in nature. In business, I want
to read facts rather than opinions. Let the facts compel me to also believe in the mission.)
3.1. Company History:
Flake E. Designs is a company born from an idea between two friends in 1999. It initially began
as an ongoing joke about one of them being completely unreliable when it came to being punctual. The
idea was that a hat should be made that said: 'Flakey' to alert others of this flaw. Although nothing
immediate never developed, CEO, Chris Martin, sat on the idea for nearly a decade and thought it had
potential to be great if applied correctly with the right talent and resources. In late 2007, Martin finally put
pen to paper and began designing the first Flake E. hat. Shortly after the initial hat was created, Martin
began work on a multitude of other products to be added including hats, shirts, hoodies, beanies, velour
jumpsuits, undergarments as well as various accessories. The initial hat idea swiftly grew and Flake E.
now produces an active lifestyle clothing line targeted at males and females between the ages of 12-35.
3.2. Executive Summary: (You don’t need an executive summary for this paper. This is not an
executive summary. This is simply more background. I will be covering executive summaries more
later.)
When I interviewed CEO, Chris Martin, I initially asked him: ‘What makes Flake E. so
different?’ Martin’s response was that he didn’t want Flake E. to simply be an alternative to existing
companies. Martin wanted to do something unique. Early on, he contacted a friend who owns a large tree
farm in Costa Rica that plants the Jatropha tree which is the active ingredient in the sustainable fuel, biodiesel. An alliance with Verdenergia became a vital element to Flake E's mission statement. It shaped
an environmentally-conscientious company mentality with the global objective to significantly repopulate
the devastated Costa Rican rainforests. Their mission statement: 'For every garment sold, a tree
is planted in your honor.' is short and powerful. No matter how 'Green' anyone considers themselves to
be, Flake E's goal beyond simple profit is easily comprehended and undeniably significant.
Removed, 3
4. Marketing Mix Analysis: (Four P's)
4.1. Product:
Flake E. Designs is an active lifestyle clothing line that currently targets between the ages of
12-35. The clothing is heavily influenced in both design and functionality by Portland itself. Meaning, the
designs are deeply rooted in the unique lifestyle and vibe that makes Portland special as well as being
suitable clothing for all the drastically different weather patterns of Portland. Landmarks such as
Portland bridges, skate parks, statues, monuments, city skyline and even the rose as a symbol of the city
itself are infused with tattoo artwork and shapes Flake E's overall aesthetic look and individual feel.
Flake E's general mentality as an active lifestyle clothing line is to cater to those who have a
strong connection to the city. This applies to those who actually live here as well as anywhere in the
world. Like other cultural hotspots around the globe such as New York, Paris, Rome, Amsterdam or Los
Angeles, Portland is one of those booming cities with a certain kind of allure that people want to be a
part of. Flake E's goal is to capture and embody that Portland vibe and channel it through their clothing.
Whether it be for Portland residents or those who have never visited the city and are enticed by it fragment.
4.2. Price:
Due to the wide variety of items and ranging fabric quality that Flake E sells, their price points
don't line up under one specific price range. It is a generally affordable line but can vary relatively widely
depending on certain item's quality or design complexity. A women's velour track suit retailing for $100
or a particularly expensive, high quality fabric men's shirt retailing for $48 are examples of the higher
range. On the other side of the spectrum, they have a great deal of items ranging anywhere from a $15
shirt or a multitude of accessories such as hats and dog tags that retail under $25. For this particular
market, (active lifestyle category) Flake E. predominantly runs between average or slightly higher prices
than their competition. Flake E. has a higher end, boutique type of fashion sense on one end as well as an
assortment of very affordable garments to appeal to all affluences.
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4.3. Place:
Although Flake E. has a handful of stores here in Portland and other cities in the surrounding
states that carry their apparel, they currently do most of their sales through their online store located on
their main website, flakeedesigns.com. Due to the generally smaller scale of business they conduct from
being a younger company, the online store seems to be a very successful method for them in order to
ensure inventory can be quickly created or replaced as needed awkward sentence. Flake E's website is
currently going
through some major changes due to issues with the storefront as well as a massive facelift to the overall
flow of the pages, general aesthetics and functional optimization in preparation for their next big line
due out in the Fall for Winter 2010/11. This is a huge area of potential improvement due to how much
traffic is driven to their website through their various methods of online marketing. Since Flake E. is a
smaller company still trying to gain their footing in a highly competitive market, they have begun to take
full advantage of available social networking resources to ensure costs be kept as low as possible. Which
leads me to the final area of the Marketing Mix: Promotion,
4.4. Promotion:
In our interview, Martin’s explanation of Flake E’s use of social networking sites such as
Facebook, MySpace, Twitter and LinkedIn are areas of consistent use and promotion in order to keep
costs low and still have a strong presence among that crowd of consumers since the majority of Flake E's
target market are intelligent, internet-oriented people who use many of these sites to spread information
amongst their friends. Martin also discussed Flake E’s participation in a number of the larger, more
expensive events such as RedBull: FlugTag, Dew Tour, Sundance Film Festival, as well as their own
annual skate competition. Martin explained these events’ importance to Flake E. because he believes it to
be vital to be out amongst their target market as much as they can financially afford to be. Where Flake E.
comes up short financially, they make up with ingenuity and guerilla marketing. Martin also experiments
heavily with various promotional elements that they disperse at all their events. Ranging anywhere from
stylish, rubber Flake E. bracelets to custom-dipped chrome Flake dog tags. ‘It’s an imperfect science!’
Listen to this Ted talk
http://www.ted.com/talks/seth_priebatsch_the_game_layer_on_top_of_the_world.html
I think it is very relevant to this company and it just might spark some ideas for this particular company
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5. Introduction to Environmental Aspects:
Since Flake E. Designs is a small start-up company, there was less readily available sources
directly referencing them. Sounds a little negative starting with this sentence. Could have simply started
by saying this audit will focus on the competitive environment… However, by researching a great deal
about their competition, (local and
national) target demographic trends, promotional trends in youth marketing, industry statistics and
cultural similarities within the action lifestyle industry’s target audience, I discovered a great deal that
enabled me to create a solid marketing research audit that evolved AROUND Flake E. and what they are
up against in one of the most fiercely competitive I have ever read about.
The most appropriate key environmental aspects to probe for Flake E. were the technological,
cultural and competitive environments. As I probed each environmental section's relevant information, I
discovered the competition, while well-established and plentiful, can be penetrated by maintaining a
disciplined level of ingenuity when it comes to marketing and promotion aside from the traditionally
expensive methods. (Pinnacle 2010) I believe guerilla marketing, resourceful promotion methods and
most importantly, maintaining a great product people want to buy as well as want to be a part of the Flake
E. lifestyle will be how Flake E. breaks through the competition and recognized as genuine competition.
5.1. Cultural Environment:
In recent years, the active lifestyle clothing industry has evolved into a significantly substantial
portion of annual fashion sales around the world. In some aspects, it has come to rival even the most
popular mainstream sports such as basketball and football. The brand loyalty these consumers have is far
greater than that of many mainstream sports as well since the majority of the active lifestyle companies
project a lifestyle or counter culture through their brand. These lifestyles often include elements of music,
action sports, fashion and community. The consumer can find their individuality through a more
community-oriented lifestyle that mainstream brands only project through flawless body structures and
sex-driven allure. This is an area Flake E. has focused on by incorporating the sustainable aspect since the
company’s inception. Though the idea behind Flake E’s sustainable mission plan comes from Martin’s
strong belief in the project, green companies have become far more common over the past few years.
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Thinking locally first, Flake E. has the right brand image to have a significant impact on the
Portland area if promoted and marketed correctly. Since Portland residents are known to take great pride
in their city, Flake E's immediate local appeal applies to more than just the active lifestyle market: they
become relevant to anyone who loves Portland, its community vibe and imagery that accompanies the
city. The only question is if the wide variety of clothing options Flake E. produces will capture the
interest of people outside the active lifestyle genre. Martin states the appeal of Flake E. goes beyond
skaters and snowboarders in Portland. Martin says due to the care-free brand image, environmental roots
and the overall clothing line diversity is intentional so there is nearly something for everyone. Sentence
structure
Although I believe having such a broad target market can be a disadvantage due to not having a
completely zeroed in target audience so a company can concentrate all efforts on reaching that group,
there is some validity to reaching a broad range of people. Martin also stated in our interview that his
intentions when creating Flake E. was never to become the next Hurley, Nike or Abercrombie. He has
always envisioned Flake E. as an active lifestyle apparel line that doesn't conform to one specific body
type or personality trait. Martin also discussed the importance of having a line for people who consider
comfort and functionality to be just as important as compelling and fashionable designs.
Portland has become a hot spot for a wide variety of interests including sustainable fashion in
recent years. Valery Joseph states:
“That Portland, OR is a poster child of green values and sustainable living is hardly news. Consistently
name-checked in the media and the recipient of countless awards-most recently, the honor of “Greenest
U.S. City”-the Pacific Northwest town has become the urban darling of the eco set.” (Joesph 2007)
People who don't even live in Portland know a great deal about the city's way of life and citywide
mentality. It's this kind of city-related allure that I believe Flake E. should further develop while looking
to expand their brand awareness. Focusing on the Portland lifestyle can be marketed a huge majority other
than just the action sports consumers because the city encompasses so much culture. It's mellow persona
draws people here for more than just the micro brews. Portland has become a melting pot for creative
people as well as sportswear moguls like Nike and Adidas who’s headquarters are located here.
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5.2 Competitive Environment:
The active lifestyle clothing industry annually produces staggering profits. The allure of such
potential profits creates highly talented and incredibly fierce competition. An unusually creative talent
pool has accumulated in recent years and Portland has become a new mecca for some of the most fashionforward entrepreneurs who look to carve their own profitable corner out in the industry. A fairly
significant number of these people have experience working with the best and brightest at the same global
sportswear juggernauts which make them considerably savvy competition. (Moody, 2006)
One example of a Portland-based company similar to Flake E. is Wicked Quick. Founded in 2003
by Tarran Pitschka who decorated his clothing in tribal tattoo artwork, rebel bikers and began selling at
drag racing events. Since Pitschka launched in 2003, he has positioned Wicked Quick in nearly every
Nordstrom across the country, various boutique chains and even select Harley Davidson outlets. For the
past couple years, they have been doubling their annual profits (Rosenfeld 2009) Although Pitschka’s
story sounds like a fairy tale, it’s only one of several that hail from Portland who are gaining momentum.
On the opposite side of the spectrum lie the major players in the industry. They are the action
sportswear super powers like Lost Enterprises, Volcom and Hurley International. Like all other action
sport clothing companies, they originally began as small, garage-based silk screen shirt printing
skaters/surfers/snowboarders who enjoyed the counter culture they were a part of. These companies
origin stories reflect the culture their founders were a part of and loved so much. But, a lot has changed
since then. Their popularity and success catapulted them into the major leagues and most have been
bought out by larger companies. (ie: Nike owns Hurley International.) With the rising popularity of these
companies, it’s no surprise they would be consumed by larger entities who want to buy their way into the
market. (Volcom.com, Hurley.com, LostEnterprises.com) While Flake E. isn’t trying to be a global
presence, they certainly have to deal with them as major competition due to seemingly unlimited funds
and brand loyalty. It is my belief that for Flake E. to realistically contend with similar companies, their
Portland appeal is their best competitive edge.
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5.3 Technological Environment:
The third and final environment I analyzed for Flake E. was the technological environment. As
marketing shows, technology doesn’t have to only be computers but rather any form of technology that
helps your business to be a faster, leaner and meaner company. In a jaded society saturated by technology,
it is imperative that all technological assets readily available To Flake E. be used to their fullest potential
without losing sight of continuing to produce a quality product.
Although I think social networking sites have proven to be a great asset to plenty of companies,
too much time and resources can be wasted on them and risk making the Facebook page more important
than the final product. In the article: “ROI Doesn’t Mean Return on Ignorance” he explores the multitude
of social networking sites that help companies extend their reach for free but Solis says: ‘Your time has a
price tag and resources don’t materialize without costs’ (Solis, 2010). Great! Finding that perfect balance
of
social network reach is important for Flake E. to utilize and improve on where possible as well as to be
careful not to invest too heavily in them. This leads me to a community development idea for Flake E.
Like Solis stated: “Time has a price tag.” Some elements on our favorite company’s websites
require significant amounts of time to create but are incredibly effective. I think Flake E’s website should
incite people to visit for more reasons other than to just see what’s new this season. A stronger
community sense could be created with the use of video blogs, promotional event highlights, forums,
letters from the CEO, upcoming Flake E. events in various areas, and an assortment of other related extras
that give similar action lifestyle websites a sense of belonging that customers can invest in emotionally as
well as financially. Flake E’s fans love Flake E. for their fun and fashionable clothing as well as their
mission statement objective. Another example could be a weekly video blog from their Costa Rican tree
farm updating people of recent news. I believe by enabling Flake E’s customers to get to know them
better as a company, they will build a much stronger brand loyalty base.
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6. SWOT Analysis:
6.1. SWOT Matrix Chart:
Strengths:
• Portland-influenced apparel
• Highly appealing green/goal
• Edgy yet fashionable
• Strong Portland fan base
• Wide variety of products
• Effective PDX-oriented
continuity throughout all areas
of company
• Suits PDX’s green mentality
• Potential nationwide presence
• Realistic and attainable goals
• Innovative & creative team
• Has interested angel investors
• Incredibly resourceful team
• Portland residents city pride
Weaknesses:
• Not widely known
• Funding is sparse.
• Difficult to grow business
• Oversaturated market
• Excessive competition noise
• Difficult to fund advertising
• Inconsistent new product releases
• Weak internet presence
• No community vibe on website
• Occasional issues with supply
• Lack of strong distributor list
• No int’l textile relationships
• Little vertical integration
• Website in need of improvement
Opportunities:
• Skate team sponsorship
• Major store chain deals
• Pro athlete sponsorship
• Celebrity sponsorship
• Music Festival promotion
• Increase number of annual
skate competition events
• Extreme Sport competition
sponsorship/ promo event
• PDX Fashion Week sponsor
Threats:
• Well established competition
• Competition’s funds nearly
limitless
• Potential for company to
replicate Flake E’s style
• Funds dry up. Have to close
• General disinterest occurs
• Recession prevents real
growth
6.2. Discussion: Internal/External Factors:
Upon researching and writing this paper in its entirety before looking at the different strengths,
weaknesses, opportunities and threats of Flake E, it is fairly clear that Flake E. has significant hurdles to
clear regarding what the competition is capable of doing. Fortunately, Flake E’s team is highly creative,
resourceful and possess a great deal of ingenuity. If Flake E. is just as aware of their weaknesses as their
strengths, calculated steps can be put into effect to remedy, prevent and anticipate most of them. Some are
minor, others require more effort and some are incredibly daunting challenges to overcome.
Some of the more important internal and external factors I discovered predominately stem from
the lack of accessibility to substantial funds in order to rectify a large number of them. Although this is a
Removed, 10
hurdle every budding business goes through, Martin has several angel investors who he has structured a
deal with that will go into effect at the end of September. The deal will distribute a substantially large
amount of funds that will cure multiple areas of concern as well as sustain Flake E. over a 12 month
period. For the projected 12 months, Martin has drafted an itemized allocation of all funds and a
correlating prioritized list of areas to grow and improve. After 12months, the deal will be reevaluated and
restructured for more. The investor’s ROI is a small percentage stake in Flake E’s potential future profits.
7. Conclusion:
Chris Martin and his company, Flake E. are a great example of a creative idea taking hold and
inspiring someone to actualize it. By collecting industry knowledge beforehand, teaming up with equally
talented people and pursuing financial independence paired with a powerful mission statement, I think it
actually may be possible for the little guy to enter such an aggressive industry and stay afloat if they are
prepared, educated and just a little crazy. More than 80,000 new businesses fail every year due to a slew
of preventable mistakes. One that applies to the fashion industry more than any other is the lack of
industry knowledge. It is now painfully clear to me how a new company could be blind sighted if they
don’t do their homework. And oversight in this industry can prove to be fatal.
The fierce, unapologetic mentality of the action lifestyle clothing industry has taught me that it is
not an industry for those who are uncertain of their goals. If a company is not prepared to actively pursue
the goals they set for themselves, they will either be chewed up and spit out or quickly fade from
memory. I perceive Martin to be the kind of CEO/entrepreneur who is calculating and cautious to a
degree but enough of a wild card to know when to make the kind of bold moves that can define a
company. Because in an industry like this, it seems that only the bold make it out alive.
Set your word processor up for double spacing rather than hard returns. The grammar checker will be
more accurate.
Very interesting company. I look forward to hearing more about your recommendations.
Removed, 11
8. Works Cited:
Flake E. Designs Website. "Company Research and Study" August 2010.
<http://www.flakeedesigns.com>
Gordon, Kim. "Marketing: Talk is Cheap" Entrepreneur.com. December 2006.
<http://www.entrepreneur.com/marketing/findingcustomers/article170588.html>
Horny Toad Clothing Website. "Company Research and Study" August 2010.
http://www.hornytoad.com/toad/do-the-right-thing/mission.html
Hurley International. “Company Research and Study” August 2010.
<http://hurley.com/base/history/>
Joseph, Valerie. " Earth Bound: Portland Fashion Week serves up sustainability with style"
October 23, 2007. <http://www.refinery29.com/earth-bound.php?topcategory=fashion>
Lost Enterprises. "Company Research and Study" August 2010.
<http://www.lostenterprises.com/history>
Martin, Chris. "Personal Interview: Flake E. Designs CEO" August 3, 2010
MediaCenter Marketing. "The Greening of Men's Wear" April 2, 2007.
<http://www.wbnx.com/green/menswear_green.pdf>
Moody, Robin. "The Clothes Lineup" Portland Business Journal. June 2, 2006.
<http://portland.bizjournals.com/portland/stories/2006/06/05/story3.html>
Pinnacle Promotions. "Marketing to Teens with Promotional Products" 2010.
<http://hubpages.com/hub/Marketing-to-Teens-with-Promotional-Products>
Rosenfeld, David. "Speed Spurs Wicked Quick Sales" Portland Business Journal. October 30, 2009
<http://portland.bizjournals.com/portland/stories/2009/11/02/focus3.html>
Solis, Brian. "ROI Doesn't Mean 'Return on Ignorance" BusinessWeek.com July 7, 2010.
<http://www.businessweek.com/innovate/content/jun2010/id20100630_904162.htm>
Verdenergia Foundation. "Company Research and Study" August 2010.
<http://www.verdenergia.org/>
Volcom Clothing Website. "Company Research and Study" August 2010.
<http://www.volcom.com/history/index.asp>
Criteria for Business Course Papers:
Minimum expectations for papers in this course are highlighted in the rubric in bold.





Style
o
Follow MLA format using proper page headers, margins, in-text citations, citation page
etc.
Writing style and grammar
o Papers with excessive grammatical errors will be given a 0!
Plagiarism
o Plagiarized papers will receive a 0 and may not be resubmitted for improved grade;
however, you may be required to rewrite the paper to meet course requirements.
o A few forms of plagiarism:
 Copying sources – even one sentence, without using appropriate means of
identifying origins – see MLA style guide
 Using someone else’s ideas without citing the source.
 Using your own work from another class without permission.
Sources
o You are required to use authoritative sources in your papers in addition to the textbook
–
 General rule of thumb: One - two sources per page (i.e. 3 page paper should
have 3-6 citations)
 See individual assignments for requirements
o Use authoritative sources from professional journals, scholarly journals, etc. Do not use
sources such as Wikipedia, Dictionary.com, or biased sites. (Be critical)
Resubmitting Papers & Late papers
o See individual syllabus for policies on late papers and resubmitted papers
Grading Rubric
Category
Assignment Criteria

Page/word requirement

Research requirement

Submission requirement

Formatting requirement

Other as indicated on
assignment
Content

Presentation

Persuasion

Explored various
perspectives

Included supporting
details

Thorough coverage of
topic
Writing Style and Grammar

Grammar

Spelling

Sentence structure

Readability

Paragraph flow

Creativity
MLA Format

Headings

Page margins

Page numbering

Line spacing

Typeface

Number usage

In-text citation use
Sources

Citation page

Content of citations

Format of citations

In-text citations

Reliability

Quantity of citations
Organization of Content

Introduction/thesis
statement

Transitions

Logical flow

Appropriate paragraph
breaks

Conclusion
Business Style Writing

Established Hierarchy

Headings

Subheadings

Active voice

Eliminates unnecessary
words

Avoids long cumbersome
sentences
Late: See syllabus for policy
Criteria
Exceeds assignment criteria
Meets all requirements of assignment
Meets most requirements
Meets some requirements
Meets few requirements
Ratings
19-20
17
13-16
7-12
0-6
Score
18
All topics are addressed thoroughly with supporting details.
Enough facts are gathered to present ideas persuasively. No usage
of terms such as “I feel, I believe or I think.” Additional research
was done with new related topics exposed and/or explored.
All topics are thoroughly addressed with supporting details.
Enough facts are gathered to present ideas persuasively. No
usage of terms such as “I feel, I believe or I think.” Critical
reflection and construction of new insight is evident
Most topics are addressed with supporting details
Topics not addressed fully. Content is primarily a summary of the
textbook
Compelling and creative writing style. No grammatical errors
Sentence structure is varied and rhythmic
Very few grammatical or spelling errors.
Sentence structure complete and non-cumbersome
Highly readable
Readable
Some grammatical/spelling or sentence structure errors
Many errors
Difficult to read
Followed MLA style with no errors
Followed MLA style with minimal errors
Followed MLA style with some obvious errors
Little or no effort made at MLA compliance
17-20
12
10
7-9
4-6
0-3
10
Researched additional sources to find valid alternate opinions
and/or appropriate examples
Used an appropriate number of sources. All sources are reliable.
Citation page and in-text citations are correctly formatted
Too few sources or sources were not reliable; however,
citations were correctly formatted
Too few sources or citations incorrectly formatted
No sources, no attempt at compliance
Paper includes a strong thesis statement, a variety of thoughtful
transitions, arguments presented in a logical sequence and
position is restated in the closing paragraph
Introduction outlines main points of paper, sequence is logical
and conclusion summarizes paper
Sequence is logical but either the introduction or conclusion is
weak or missing
Paper consists of random pieces of information that is not
connected. It is difficult to follow any logical thought process
Has a well established hierarchy, succinct writing style that is
clear, non-cumbersome and predominantly in active voice
Subheads used on papers longer than one page. Most
unnecessary words were eliminated. No awkward sentences.
Bullet points used wherever appropriate
No subheads used or paper uses too many meaningless words
None of the business style writing guidelines followed making
paper difficult to read
9-10
10
13-16
6-12
0-6
18-20
17
14-17
8-13
0-7
7-8
4-6
2-3
0-1
10
10
7-9
3-6
0-2
9-10
10
6-8
3-7
0-2
0
Total
87