Fashion Market (FM) FM is a retailer of low-price clothing. It opened its first store in country X in 1978. FM became a public limited company in 2010 with 150 stores in country X. Fashion changes very frequently and so there is a fast changeover of clothing designs. FM's customers are often unsure how long clothing designs will be in store. This encourages FM's customers to purchase items as soon as they are available. Until 2020, FM's promotion relied mainly on customers telling their friends and family about the clothing designs available in store. FM's marketing objective is to grow revenue faster than its competitors in all markets it operates in. Timeline for FM 2020 A new Chief Executive Officer (CEO) is appointed. The CEO wants to make major changes to FM's marketing strategy. 2021 The CEO convinces FM's board of directors to start an ambitious international distribution plan [Appendix 1]. 2022 FM launches a range of sustainable clothing. This causes problems for FM and its pricing policy [Appendix 2]. 2023 Digital promotion campaign launched across stores. Digital in-store displays and a social media campaign using #fashionmania to advertise clothing and attract customers to FM's new website [Appendix 3]. 2024 The directors review the performance of FM and the recent changes to its marketing strategy under the current CEO [Appendix 4]. Development of a new business strategy FM wants to achieve global growth as well as ensure profitability for its shareholders. Some directors think a blue ocean strategy approach should be used to develop a future business strategy. However, other directors think approaches focusing on the external environment would be more appropriate for FM. [Appendix 1: Extract from CEO's international distribution plan (2021)] • To open 25 stores across 7 high-income countries. • Market research into potential new international locations for stores will cost $10m. • New distribution warehouse to be built at a cost of $30m. • Pan-global marketing to be used to target customers. • Forecasted annual international sales of $180m. [Appendix 2: Operations Director's report on the impact of the sustainable clothing range (2022)] • Average fabric costs 35% higher for this range than existing clothing ranges. • Average prices 25% higher for this range than existing clothing ranges. • FM blamed for using suppliers who have been discovered to use unethical practices, FM's public relations costs tripled to deal with this. • 21% of total sales volume from new sustainable clothing range. • FM accused of misleading customers who question the sustainability of a $2 t-shirt. [Appendix 3: #fashionmania campaign plan (2023)] • Boost sales after the closure of stores during the global pandemic. • Use of #fashionmania to collate online images from social media to promote clothes. • Create areas in store where bloggers can take pictures of themselves in FM's new clothes to post online. • Use website as a medium to show new clothing designs and customers' #fashionmania pictures. • Sponsor a reality TV programme to promote clothing ranges. [Appendix 4: Selected financial and marketing data for FM] | | 2024 | 2023 | 2022 | 2021 | |---|---|---|---|---| | Revenue (000) | 2189540 | 1370437 | 1950250 | 2297540 | | Marketing expenditure (000) | 95040 | 135090 | 59500 | 27000 | | Profit from operations (operating profit) (000) | 137950 | 99750 | 129500 | 185495 | | Share price () | 1.27 | 0.98 | 1.39 | 2.45 | | Market share in country X (%) | 6.8 | 5.9 | 6.4 | 6.9 | Answer both questions 1 Evaluate FM's marketing strategy between 2021 and 2024.

Mark scheme

Marking points from the official mark scheme (Oct/Nov 2025). The mark or mark type is shown in brackets.

1. [1] Identification of an element of marketing strategy.
2. [1K, 1DEV] Identification and one developed explanation of an element of marketing strategy.
3. [1K, 2DEV] Identification and two developed explanations of an element of marketing strategy.
4. [Indicative Content AO2] traditional word of mouth advertising
5. [Indicative Content AO2] low investment in advertising pre-2020
6. [Indicative Content AO2] sustainable clothing range marketing investment almost double (App2)
7. [Indicative Content AO2] PR spend up in 2022 – overall marketing increases by $70K - use of annual figures (App4)
8. [Indicative Content AO2] social media usage is changing approach
9. [Indicative Content AO2] digital in-store displays
10. [Indicative Content AO2] digital promotion campaign
11. [Indicative Content AO2] use of new website
12. [Indicative Content AO2] marketing spend is starting to fall but more than three times bigger than 2021
13. [Indicative Content AO2] elements of #fashionmania strategy – social media/sponsorship of TV programme
14. [Indicative Content AO2] retailer of low-priced clothing
15. [Indicative Content AO2] fast changeover of clothing designs
16. [Indicative Content AO2] use of market research into potential new international locations for stores – cost $10
17. [Indicative Content AO2] to open 25 stores across 7 high income countries
18. [Indicative Content AO3] Low pricing is part of their unique selling point and has been their 'Blue Ocean Strategy' from the start and served them and their market well
19. [Indicative Content AO3] PR costs have tripled – not really part of the advertising but is part of media image that has been managed by the expose of FM to unethical suppliers. This increase in costs may have contributed to 25% increase in price. This could lead to customers no longer seeing FM as good value either because prices have risen or because of unethical suppliers.
20. [Indicative Content AO3] #fashionmania driven by customers and still allows FM to gain free advertising
21. [Indicative Content AO3] Above the line spend is still low but the #fashinmania strategy requires advertising materials in store which costs money.
22. [Indicative Content AO3] Product has essentially stayed the same throughout, with low price point as driving factor. Keeps market share of existing customers who are now sharing their finds on social media.
23. [Indicative Content AO4] A judgement over how much of the word of mouth is still being used? They were spending £27m in 2021 so must be undertaking more than word of mouth advertising. Is this marketing responsible for recent success?
24. [Indicative Content AO4] A judgement over how launch of any programme would require more marketing/PR to ensure that new direction of the business is clear to all stakeholders so there should be an increase in marketing spend.
25. [Indicative Content AO4] A judgement over how marketing has been successful as while sales dropped – potentially from ethical exposure – they have soon recovered, and customers seem to have forgiven them for the 25% increase in price.
26. [Indicative Content AO4] A judgement over how marketing has been successful in recovery of the programme, but it also exposed them in the first place - has the sustainability program helped the company improve its market share? Has it caused more bad publicity for FM than they brought in revenue?
27. [Indicative Content AO4] A judgement over how #fashionmania strategy still costs money in store – how much compared to advertising? Is this more cost effective? TV sponsorship is first real entry into big above the line promotion, will this add to cost and ultimately price? What effect will this have on demand?
28. [Indicative Content AO4] A judgement over how CEO's decisions have caused the increase in marketing- could FM refocus on their core values and approach for their future expansion and abandon – fast cheap fashion?
29. [Indicative Content AO4] A judgement over how success may be dependent on how much they have recovered from the ethical scandals including the recovery in revenue.
30. [Evaluation L1] FM marketing strategy was successful between 2021 and 2024 because it has regained its market share.
31. [Evaluation L2] FM marketing strategy was successful between 2021 and 2024 because it has regained its market share. This demonstrates their marketing strategy have supported them in recovering from the ethical scandal.
32. [Evaluation L3] FM marketing strategy was successful between 2021 and 2024 because it has regained its market share where it dropped to 5.9% in 2023 and regained to 6.8% in 2024. This demonstrates their more recent marketing strategy has supported them in recovering from the ethical scandal in 2022.
33. [Evaluation L1] FM marketing strategy was not successful because the increased marketing expenditure was not reflected in increase revenue.
34. [Evaluation L2] FM marketing strategy was not successful because the increased marketing expenditure was not reflected in increase revenue. This shows that they have not recovered well from their ethical scandal and have been unable to meet their objectives set in 2022.
35. [Evaluation L3] FM marketing strategy was not successful because the increased marketing expenditure $27m to $95.04m was not reflected in increase revenue (decreased from$2297.540m to $2189.54m. This shows that they have not recovered well from their ethical scandal and have been unable to meet their objectives set in 2022.