All questions must be answered in the context of the Case Study. Management opportunity: Sustainable shoe and activewear brand Allbirds is planning to expand its physical store network (currently, sales in Australia are from online sales), opening in two new locations: Melbourne (in the state of Victoria); and Sydney (in the state of New South Wales) in September 2022, despite the ongoing concerns of the COVID pandemic. In addition, Allbirds intends to set-up pop-up stores at popular beaches such as Bondi Beach and Byron Bay in New South Wales in the summer of 2022, and at Bell's Beach in Victoria for the World Surf League Rip Curl Pro surfing event in Easter 2023. WE ARE ALLBIRDE 4 allbirdsPart 3: Marketing Mix Strategies (20 Marks) Question 3. 3a. Develop and justify three (3) promotion mix strategies that will communicate Allbirds' customer value to the target market identified in question 1b. (3 x 4 = 12 marks). 3b. Draw a supply chain diagram representing the multi-channel distribution/logistics (placement) strategies for Allbirds' including their new retail initiatives in Australia (new stores). Justify your answer as to why Allbirds should implement a multi-channel strategy. (8 marks)Abstract 1 Wis an exciting new company that is disrupting (changing) the footwear industryan industry known for its unsustainable environmental and production practices. This case examines the start-up motivations of the founders and the product innovations they have developed within the casual shoe category since its inception in 2016. In 2019, Mad four different shoe styles, plus a ip-flop (type of outdoor sandal see Figure 3], made from three sustainable, innovative materials: merino wool, eucalyptus bre, and sugar cane. TheBirthofm Tim Brown was an elite member of the New Zealand 2010 World Cup 'All White' soccer team. He knew that the footwear industry used unsustainable production practices (Graeme. 2014; Park-W8; Rees, 2010}; an issue that continued to bother him after his soccer career was over. When he nished playing soccer, he decided to create a sustainable shoe himself Being from New Zealand, he knew of the fabulous qualies of merino wool and wondered if this product could be used to make great shoes. Joey We; an gpgiprand sustainability expert based in San Francisco introduced Tim to sustainable material innovation- 200 prototypes (samples). Later, a. simply designed, comfortable shoe made out of merino wool While other footwear manufacturers had efcient product manufacturing, distribution, and marketing capabilities, the secret of M' success was its sustainable materials innovation. Despite not having the resources that existing footwear brands possessed (e__g= distribution and marketing), M' competitive advantage came from their expertise in sustainable materials innovation (Barney. 1991). Their rst product, launched in 2016, was the Merino sneaker (see Figure l 1, made from sustainably and ethically sourced merino wool (m u.d.). Merino wool is an ideal, sustainable material for footwear because it does not absorb moisture and because it requires 60% less energy to produce than typical synthetic materials used by other brands. m designed a new form of shoe insole using part castor bean oil, a renewable raw material that replaced 20% of the petroleum traditionally used in the polyol of polyurethane foams {The Kind Guide, n.d.}, and shoelaces made from recycled plastic bottles. All the shoe material components aligned with the m core value of sustainability (Brown, n.d.). Even the product packaging was a shoe box made from 90% postconsumer recycled cardboard and used 40% less materials than traditional packaging (Bezzant, 2013). Figure l. Merino Wool Sneaker! all-lh. Although wool on your feet is perfect during the cold winter Wwool can be quite hot in summer. To address this problem, m found a wood-type textile, ethically sourced from South African eucalyptus trees, called Tencel Lyocell. This new material and M' unique 3-D knitting process enabled the shoe to stretch and gave it great cooling properties and comfort (mag, ZlBa}. Additionally, eucalyptus $5M\" employed which only uses 5% of the water and one-third of the land when compar with traditional footwear materials (Ewing, Zlb). This second product took two years to develop and was Forest Stowardship lCouncil (FSC) certified (Ewing, 2018b). The product line was named the 'Tree' range and included the nmner, lounger, topper, and skipper (see Figure 2}. Figure 2. mm Sldpper 2 in August EDIE, Weleased a third product, a flip-op, which globally sold out online within three hours. The ip-flop was called the Wand made from sugar cane. (E Figure 1}. ngnlmm Values m values were based on constant improvement (Brown, n.d.}. These values were non- negotiable and included: 1 . Comfort: people buy shoes because they are comfortable 2. Design: simple and needs to look good. 3. Sustainability: people care about the planet. There have been 27 product improvements to the wool shoe over the last three years - much of this stemmin 'om customer feedback. Innovations need not always be revolutionary they can IE Ee form of a comfortable pair of shoes that bring comfort and design together. The unique materials used in Mahoes come at a premium for consumers, who must pay between $155 and $285 for a pair ofwm shoes. A Foot in the Market 3 In August 2018, Allbirds' shoes were available for purchase in the United States, New Zealand, Canada, and Australia, and an online release was planned for the UK in October. The brand now has six permanent retail locations - their flagship store in downtown San Francisco and further stores in New York, Chicago, Boston, Seattle, and London - as well as temporary pop-up stores in various locations (Chittakorn, 2018; see Figure 4). Careful attention to materials science has enabled Allbirds to forge a unique position in the market around design and sustainability. Existing footwear manufacturers have not adopted the same sustainability trend (Anderson & Tushman, 1990), as they did not observe an immediate impact on their customers' preferences (Cozzolino, Verona, & Rothaermel, 2018). Behaviour among these organisations continues to revolve around incremental (small) improvements to existing products, rather than developing products that are a major change from existing industry standards (Sosa, 2011). Figure 4. Temporary Pop-Up in Chicago Allbirds is a certified 'B Corp' - the equivalent of Fair Trade Certification for coffee. In April 2019, Tim announced that 'it's time to take the next step and become carbon-neutral' (Keall 2019). To do so the company placed a self-imposed carbon tax on every shoe produced. This carbon tax was applied to the entire Allbirds business, including management and employee travel. The money raised through these taxes was used to purchase carbon-offset credits from NativeEnergy, which funds projects such as forest replantation in the Amazon and wind farm development in India. Allbirds was also committed to giving previously worn shoes to Soles4Souls; a non-profit that distributes used shoes and clothing around the world (Soles4Souls, 2018)