Hosiery Industry Case Study

The Hanes corporation is renowned for its underwear and hosiery products, as well as for its bras and sweaters. Prior to the introduction of L'eggs, the company, along with the rest of the hosiery industry, had been hit by a flattening out of sales and a glut of pantyhose production. Most hosiery was sold, then, through department and specialty stores that wanted private labels. Because the market was at its saturation level, these stores were able to put a price squeeze on the manufacturers, thereby eroding the profit levels of these manufacturers.

Hanes, along with its competitors, was mostly a marketing company, preferring to sell what it already had, as opposed to being a market-driven company, trying to sell what the customer wants. The company did little advertising, and considered itself a manufacturing company, not a sales-oriented organization. The result was that Hanes paid little attention to the fact that hosiery, on an increasing scale, was being sold in supermarkets and drugstores, market outlets that Hanes mainly ignored because the pantyhose and stockings sold there were not particularly well-made and customer complaints were frequent.

In the product lifecycle concept, hosiery products had reached stage 4 and stage 5 levels, i.e. competition had

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f his competitors had time to react Hanes had become the market leader in the sales of pantyhose. The price--what is the relative cost compared to the alternative product choices? Although not specified in the article, it can be surmised that L'eggs pantyhose was competitively priced, considering its target audience and sales outlets. Most of Hanes' success is to be attributed to a change in its redefining its business within the Marketing Concept. Market orientation--popularly referred to as the Marketing Concept--became a basic philosophy of American business during the 1960s. Organizing a business to identify and serve the needs of the market was a necessary response to the rapid growth of the consumer economy which occurred during the 25 years following World War II. Marketing has been defined in a number of ways, but central to most definitions is that it includes the performance of business activities that direct the flow of goods and services from producer to the consumer or user. While this definition is sound in principle, it does not convey the now generally accepted idea that the process begins with identification of market needs, wants, and preferences which in turn determine the goods and services the company s
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Approximate Word count = 1576
Approximate Pages = 6 (250 words per page)