Ryka, Inc. has some problems issues facing it as it tries to secure its market position against stiff competition from Nike and Reebok in an industry that is maturing with annual growth hovering around four percent. One of the biggest problems is increasing market share. Presently, the company is focusing on women only in the demographic of 21-35. Another problem is that Ryka, Inc. dependence on foreign production of its product makes it often unable to meet product demand in a timely fashion when periods of heavy ordering occur, like after CEO Sheri Poe appeared on the Oprah show. Further, the company is often forced to pay higher prices for its product and manufacturing than its major competitors because of the way it structures it outsourcing contracts. Another challenge the company needs to address is the fact that it needs to increase awareness of its product through marketing and promotional methods that are low cost. It appears that forming alliances and guerilla warfare strategies like the Oprah appearance work best in this area. However, the company must continue to be aggressive when it comes to advertising and promotion if it hopes to secure its market position against major industry leaders like Nike and Reebok.
The following three strategies are designed to help Ryka, Inc. resolve the challenges and problems stated above, while at the same time cutting operational expenses and increasing profits:
Increase its audience share by targeting younger and older women than its current 21-35 year-old demographic.
Restructure Ryka, Inc.’s, outsourcing order-as-needed strategy and achieve lower costs from manufacturers.
Continue to form alliances like those formed through the Ryka ROSE foundation and capitalize on those alliances for product exposure.
The first strategy is designed to increase market share by expanding the demographic of its target audience. Ryka, Inc. only targets the female audience as it ...