Urban Outfitters is known as a clothing retailer appealing to the 'hipster' and 'bohemian,' inspiring young people's market. Started in Philadelphia in the 1970s by two college friends, the U.S. company owns several brand labels (e.g., Urban Outfitters, Anthropologie, Free People).

In 2016, the retailer operated 572 stores across the US, Canada, and Europe (485 in the U.S.). In recent years, the retailer has reported disappointing sales and falling market share and share price. The retail sector is experiencing weak store traffic, with consumer shopping increasingly taking place online. Furthermore, young people are spending less on clothing and more on 'experiences,' including eating out in restaurants and, in particular, 'casual dining' and ecotourism travel.

It is also reported that retail store visitors seek entertainment as well as appealing products. The sluggish economy and intense competition, including fast-fashion competitors' success, are also challenging for many apparel retailers. The retailer's Chief Executive has admitted they had lost touch with changes in fashion and consumer expectations.

Their quirky, eclectic clothing and accessories ranges were beginning to be viewed as 'bizarre,' and their unique store designs and atmosphere were regarded as 'cluttered and overwhelming.' Efforts to refocus and improve quality and designs have delivered improved revenue performance, increasing online sales investment. However, growth has not continued as expected.

In November 2015, Urban Outfitters announced it acquired Pizzeria Vetri, a small, award-winning, Philadelphia-based pizza restaurant operator. This seemed like an odd acquisition and a departure from its current brand strategy since it is not related to fashion like its other branded business units (e.g., Anthropologie, Free People).

It is important to mention that this retailer has had some successful experience in the past, adding coffee shops to selected stores and co-locating stores with restaurant formats. However, operating a new business is likely to present a different kind of challenge and a need to reexamine its strategic choices.

1. What type of SBU strategy should your team develop to help Urban Outfitters accomplish this new combination (store & restaurant)? (40 points) Based on groups class discussions, reading assignments, thinking homework, and lectures, please explain the reason for your choices (why) and provide 3 academic and practical recommendations for your clients. Additionally, for the client to understand better what you are proposing, please provide 3 relevant examples that support your recommendations. (~ 300 words)

2. What steps should Urban Outfitters follow to develop the most advantageous strategic communication plan to support this combination (store & restaurant)? In other words, how could they create interesting this new phase of the company? (40 points)

Based on the groups class discussion, reading assignments, thinking homework, and lectures, please explain the reason for your choices (why) and provide 3 academic and practical recommendations. Additionally, for your client to understand better what you are proposing, please provide 3 relevant examples that support your recommendations. (~ 300 words).

3. Based on our class discussions in which planning scenarios and visualization are important factors in strategy, draw (you can use shapes and arrows from Words INSERT (Shapes) to design. Please, give your recommendations to your clients as to what the store design layout should look like when combining a clothes store and restaurant. You can also recommend an altogether different layout sometimes is good to think outside the box. Think about how the design could be linked to your optimal marketing strategy. (20 points)

Briefly, EXPLAIN your choice (why) of design layout. Use the Word INSERT tab and choose the Shapes to design your store and customer flow.