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Executive Summary

This report aims to provide an analysis and evaluation of Kikki.K's internal processes and current position in the Australian competitive market as a stationery retailing brand. Analysis was conducted to determine Kikki.K's business scope and internal and external environments in order to evaluate their problems and opportunities for further advancement in the market.

From our findings, a few main concerns have been identified for the company and industry:

Market share is quite modest  at 4.8% despite being a 17 year old brand, especially when compared to competitors such as Typo which has achieved 0.1% more as of 2017 despite Typo having only entered the market in 2009.

Changing consumer lifestyles that have taken away from traditional pen-and-paper stationery and organisation tools.

Analysis shows that the first of these concerns is likely due to:

Typo's wide appeal to a younger, teenage market, which Kikki.K does not directly focus on in their segmentation and targeting efforts

Environmental protection issues, technological advancements and digitalisation of consumer preferences

The report concludes that opportunities exist for Kikki.K in combating these two problems, by increasing marketing and brand presence both offline and online, as well as engaging with a wider set of consumers (including the untapped teenage market), in order for the brand to evolve alongside changing consumer preferences.

1. Business Scope:

Kikki.K, is an upmarket stationery retailing company with a mission to fill the gap between stylish and high-quality Scandinavian-inspired  products. Their slogan is “DREAM, DO, ENJOY, SHARE”, which is clearly connected to theirits' vision foras they want people to live their best life everyday. Actually, nowadays Kikki.K not only sells fashion stationery but also sells home and office objects, gifts and packaging goods. They also provide personalisation options of the goods they sell as additional services. While the stationery market is defined as Kikki.K's main market, sub-markets such as gift-packaging market, essential goods market and accessory market help integrate the whole picture.

Kikki.K, which started its business in Melbourne in 2001, now has about 100 stores in Australia, Singapore, and New Zealand, five in Hong Kong and five in the UK, shop-in-shops in department stores such as Selfridges and Nordstrom, and a reach of 140 countries catered to through online sellingand it reaches 140 countries' (Mitchell, 2017) customers by online selling. While its market is already globalized, Kikki.K does not seem to slow down its expansion. Due to this, they have experienced approximately $13.5 million in losses lost (www.stationerynews.com.au, 2017) from 2016 to 2017, a loss that is inevitable for Kikki.K's long-term-play, according to CEO and founder Kristina Karlsson and this loss is expected to continue as the chief executive states that it is their long-term play.

Kikki.K's main competitors in the Australian stationery market  are OfficeWorks, Smiggle and Typo (Richardson 2017). Each company targets different customer segments and offer different kinds of value to serve and fit their customers' needs. For Kikki.K, they target at young to middle-aged female customers who are appealed to by Scandinavian style stationary with inspiring meaning. Additionally, Kikki.K also focuses on marketing and sales activities that allow them to connect and build relationships with the target customers at a personal level to gain their loyalty (melissapeter.weebly.com, 2015).  

 2. Remote environment:

Political

The stationery and gift industry is subject to a light degree of regulations. Some major relevant regulations govern store trading hours. Therefore, as a retail trading store, Kikki.K's trading hours are limited.

Economical

Kikki.K is a one of retail stores which play compete in trading stores. Thus, economical factor does have a significant influence on the performance and further development.

Business confidence index (BCI) is a leading indicator that measures the amount of optimism or pessimism of the prospects of companies or organizations, also providing an overview of economy. When the index is high, meaning a boom of Australia economy, businesses are mostly doing well. In this condition, the expenditure on stationery products will increase, including paper, printing, envelopes to some extent. Based on the research, business confidence is expected to rise in 2017-2018, which may increase demand for office products and benefit industry participants (Richardson, 2017).

Richardson, A. (2017). Stationery Goods Retailing in Australia Industry Report. Retrieved from IBIS World database.

Apart from BCI, real household discretionary income are also affecting retailing market. Discretionary income its derived from disposable income which decide the purchase power of consumers. Report shows that Australian Disposable Personal Income increases to 29757 AUD Million in the first quarter of 2018, showing an increasing trend compared to the past (2018). In other words, consumers will be willing to pay for those products except from necessities, which means consumers will be more willing to pay for niche and high-value products.

Undoubtedly, Kikki.K will benefit from this positive change, due to the fact that Kikki.K position itself as a higher-value -fashion-item provider, including art supplies and scrapbooking products.

Australian Disposable Personal Income. (2018). Trading Economics. https://tradingeconomics.com/australia/disposable-personal-income

Social

To some degree, the change of social activities affects sales in the retail market for stationery and gift products. Because of the digitalization of the economy and the rise of electronic communication, people trend to interact on the Internet, draining the demand for traditional stationery products.

Apart from the negative influence of current digitalization on Kikki.K, some social factors provide opportunities to the business. Based on the position of Kikki.K, it does not focus on the kid group going to school, but those females between their early 20s and late 30s. According to research, millennial females are into handwritten greeting cards and they also tend to embrace high-fashioned stationery to fit big moments in their lives (Song, 2018) . To fulfill their demand and create appealing value of products, Kikki.K differentiate their products from those of competitors. Rather than only focus on practicality, Kikki.K provide the stationery with good look and high value, creating the love and intentionality behind products.

Song, C. (2018). Why Millenial women are obsessed with stationery. Rtrieved from:

https://www.mother.ly/life/why-millennial-women-are-obsessed-with-stationery

Environmental

Most of stationary and gift products are paper-based, while these products are wasteful. As disposable paper become more affordable for consumers, the consumption of paper-based products is increasing drastically, resulting in relevant environmental issues (“Environmental Impact”, 2014). Both governments and consumers start to realize it. Therefore, even if traditional paper-production industry is not performing well, sustainable stationery market creates excellent opportunities for retailers.

(2014, September). Environmental Impact of Paper Production. Retrieved from: http://www.theworldcounts.com/stories/Environmental_Impact_of_Paper_Production

This trend may force Kikki.K to change its product structure, including the types and the amount of Kikki.K products, such as notebooks and scrapbooks. For instance, Kikki.K is starting to renew interest in the products which are almost not influenced by environmental factor, like crayons, stamp pads and pens.

Appeal to typical audiences through changing the materials they used into more eco-friendly ways

Using Biodegradable packaging

Using recycled plastics

Technological analysis

Kikki.K company offers its products online and offline in physical stores. Beside its' websites design, the company also pays attention to the style of its physical stores, which aimed to build a typical Swedish style that differs its store from other competitors. It also focuses on customer services, aimed at providing good shopping experience in stores. It has more than 500,000 followers on social media, uses a lot online traffic information and social media feedback to communicate directly with one million customers (Mitchell, 2015).

Besides, Kikk.K has built cooperation with offline department stores such as Myer and online department platforms such as Ebay and Theiconic. Since students are part of their main target customers, it partners with popular discount providing website such as Unidays to promote itself to uni students.

As the world is getting more and more digitalized, Kikki.K, is facing the threat from the substitute electronic products which are trendy nowadays.

3. Near environment: This section includes industry analysis (IBIS/ Market share), competitive environment (5 Forces?) and consumer insights.

3.1 Industry

In order to assess potential risks and opportunities Kikki.K faces within the books and stationery market, Porter's Five Forces model has been utilised to understand the external environment Kikki.K operates in.

The diagram below illustrates the Five Forces so as to determine how Kikki.K can best determine appropriate strategies to compete within the market.

Competition and Rivalry

Kikki.K currently operates within a highly competitive industry, where the biggest players are OfficeWorksOfficeworks and Smiggle, both of which when combined take up roughly 60% of the total industry market share (Richardson 2017), as well as competing brands with similar market share such as Cotton On Group's Typo. The market is thus relatively saturated.

Threat of New Entrants

Threat of new entrants is the likelihood that new competition will enter the existing market. As it is, Kikki.K is a now a mature brand within the Australian market in which it was founded and built up. Kikki.K's strong brand identity and reputation have earned it a loyal fan-following that is unlikely to be easily swayed by new competition. That being said, newer stores and brands are still being established in the market, with one potential threat being Australian owned and operated Milligram, which operated solely online for 10 years and gained a following under its previous name, NoteMaker (Milligram 2017). Milligram's first brick-and-mortar store has since opened in Melbourne Central in 2017  (Cooper 2017), showing the threat that can arise from current online-retailers opening physical stores and providing unique shopping experiences that can rival Kikki.K's.

Threat of Substitutes

The existence of alternative products or services that are viable substitutes for a company's offerings can be seen as a threat. Kikki.K faces a high threat of substitutes due to the ever ongoing technological advancement in digital communications. This development of new technologies (Richardson 2018), including notebook and calendar applications for mobile and computer platforms, is expected to increase with the widespread use of smartphones. Coupled with cloud-synchronisation features and accessibility, there is a high likelihood that further developments of these technologies will continue to impact usage of stationery goods, though pen-and-paper tools have seen an increase in purchases in the two years leading up to 2016 (Hayles 2016).

Supplier Power

In the stationery goods retailing industry, supplier power can be considered reasonably high, especially for a one-brand retailer such as Kikki.K that solely manufactures their one brand in smaller batches, often with a new product range released every three weeks. In order for this production speed to be met in such short periods of time, suppliers most likely hold a high level of power over production costs and manufacturing prices. Supplemented by the fact that Kikki.K spent AUD$82 million in payments to suppliers and employees in 2016 (Company360 2017) — a AUD$35 million rise from 2013 just three years prior— it is likely that suppliers in a dominant position can impact a company's overall profit margin by increasing prices.

Buyer Power

Buyer power can be considered high in the stationery market, as the main thing that separates brands from one another is brand identity, alongside consumer perceptions of quality and affordability. As the products themselves have little product differentiation in terms of functionality, brands like Kikki.K focus on building a relationship with consumers through their products and the brand messages being conceptualised and communicated. In such a saturated market, buyers also have more power given low switching costs from one product to another (Porter 1979), especially in the case that a consumer is price sensitive and reluctant to spent more exorbitantly, while others may choose an alternative brand image that best represents themselves.

3.2 Competitors

Major competitors competing with Kikki.K in stationery retailing are OfficeWorksOfficeworks capturing 46.7% market share, Smiggle 12.3% and Typo having 4.9% of total market share, while Kikki.K accounted for 4.8% (Richardson 2017). Furthermore, there are some online specialty rivals arising in the market. Table below demonstrates current and future strategies of Kikki.K's three major competitors in Australian market.

Competitors

Analysis

OfficeWorksOfficeworks

Objectives

1. To increase more sales and maintain its market leader position.

Current Strategy

OfficeWorksOfficeworks is considered as a category killer in stationery and office product retailing industry. It offers a wide range of products at a low price. Pursuing cost leadership allows OfficeWorksOfficeworks to look after many customer segments. Even so, the company is expanding its product offerings into specialty areas such high-fashion stationeries and homewares where it will directly compete with Kikki.K (Richardson, 2017). Additionally, OfficeWorksOfficeworks online store had been developed to meet consumer need of convenience and it is successful. The online platform contributed 20% of total sale (Richardson, 2017).

Resource Profile

OfficeWorksOfficeworks is operated by Wesfarmers Limited, one of largest companies in Australia, thus, the company has strong financial resource supporting further development and growth (Mitchell, 2017).

Future Strategy

At the present, OfficeWorksofficeworks is still significantly growing. It is estimated that this category killer will continue expanding its stores. IBISWorld (2017) reported that OfficeWorksOfficeworks would emphasize more on business-to-business consumers in the future. Also, based on its prior online channel success, online store would be a considerable opportunity that OfficeWorksOfficeworks will concentrate on, due to the change in consumer lifestyle.

Smiggle

Objectives

1. To maintain sales and improve cost efficiency in operation

Current Strategy

Smiggle is offering colourful fashion stationery goods for tweens (children aged 8 - 12 years old), especially primary school girls (IBISWorld, 2017). Smiggle unique design with bright colours is a key differentiator behind Smiggle's success in this niche market (Hughes, 2012). However, in Australian market, Smiggle now is using harvest strategy in order to harvest the profit for investment in oversea markets.

Resource Profile

There are opportunities in oversea markets such as Asian and European countries. Referring to IBISWorld report (2017), Smiggle's sale revenue reached $188 million, but over half of revenue came from oversea stores. Due to international expansion, Mr.Lew, chairman of Premier Investments, revealed that Smiggle's sale revenue could surpass $450 million by 2020 ("Smiggle to hit $450m in sales by FY2020", 2017).

Future Strategy

Smiggle is predicted to maintain its current strategy since Australian market is mature and started to shrink down in size. Due to this fact, Smiggle shifts their focus and investment into brand expansion in global stage (Low, 2017).

Typo

Objectives

To boost the sale and continue growing through online channel.

Current Strategy

Similarly, Typo also focuses on its differentiation strategy targeting teenager and young adult consumers. Typo markets fashion stationeries, gifts, accessories, living and lifestyle products at affordable price (Low, 2017). Seasonal sales and discounts are offered to appeal its target market. In addition, Cotton On has established customer relationship via loyalty program, Cotton On & Co. Perks where one card can be used to collect points at any brand of Cotton On group, including Typo ("The Cotton On Group | Australia's largest global retailer", 2018). In term of product strategy, Typo collaborates with many brands such as Disney in launching new collections.

Resource Profile

Typo is favourable among teenagers and young adult due to its design reflecting user identity of uniqueness and fun. Likewise, the company receives financial and operational supports from its mother brand.

Future Strategy

As stated by Peter Johnson, CEO of Cotton On group, in the interview with Business Insider Australia, the company concentrates on customers rather than competition (Schlossberg, 2016). Then, Typo will maintain serving products with fun and stylist design matching target consumer' needs at the right price. Also, based on cotton on group's future strategy, Typo is planned to include as a part of Cotton On Mega-stores as a one-stop shop (Koehn, 2017). Additionally, Typo seeks growth through online platform (Hatch, 2016).

3.3 Consumers

Organizers/ Planners

Memory Keepers

Gift Buyers

Teenagers

Basic Users

Demographic

·  Women

·  Aged 20 – 40

·  Moderate to High Income

·  University Students or White-Collar workers or professionals, creatives

·  Women

·  Aged 28 – 45

·  Moderate to High Income

·  Authors, Bloggers, Youtubers, Students, Housewives

· Mostly Female

· Moderate to High Income

· University Students or White-Collar workers or professionals, creatives

· Teenage Girls

·  Aged 14 – 19

· Low to Moderate Income

· High School Students

·  All sexes

·  Aged 15 - 60

·  Low to Moderate Income

· Students, Officers, General employees

Geographic

·  Living and/or working in the cities

·  Urban and urban fringe

·  Urban and urban fringe

·  Urban and urban fringe

·  Urban and Suburb

Psychographic

Personality

· Achievers

·Fashion-conscious

· Systematic

· Being organised

· Inspired

· Neat and tidy

· Dreaming

· Motivated

· Optimistic

· Creative

· Dreamer

· Fun and cheerful

·  Attentive to people around her

·  Creative

·  Optimistic

·  Neat and Tidy

· Creative

· Optimistic

· Inspired

· Neat and tidy

·

· Easy- going

Interests/Hobbies

· Socialising with friends

· Entertaining

· Shopping

· Café

·  

· Writing diary or journal

· Cooking or gardening

· DIY

· Travel

· Exercise

·   Activities that have to do with friends

· Listening to music

· Online Shopping

· Watching Netflix and Youtube

· Watching videos via Youtube

· Shopping

· Exercise

Lifestyle

· Active

· Chilling

·  

· Chilling and hanging out with friends

· Busy

Benefits Sought

· Functional, Simple, but stylish stationery items

· Enhancing self-identity

· Fashionable Design

· Notebooks or planners helping her organize daily life and improve her time management

· Quality Product

· Emotional

· Inspiring items

· Customizability

· Emotional items

· Value for money

· Items that could represent the image of buyers

· Enhancing self-identity

· Social Status at School

· Fashionable Design

· Affordable Price

·Functionality

· Value for money

Behavioural

· Things have to be planned ahead

· Usually taking pictures of her pleasure moments

· Inspiring quote

·  Searching for gift ideas through online channels and social media such as Instagram or Pinterest

· Always following the trends

· Able to use any stationeries as long as it can make the job done

Stationary used

· Planners

· Notebooks

· Stationeries

· Matching accessories

· Diaries

· Scrapbooks

·  Cards

·  Wraps

·  Other items that can be gifts.

· Pens, pencils and other writing instruments

· Notebooks

· Pens and stationeries

· Notebooks

· Office Products

Table above provides all customer segments in stationery and paper market, where Kikki.K is targeting at Organisers/Planners, Memory Keepers and Gift Buyers groups as their major customer segments. In order to create more effective marketing strategies, current consumer analysis is conducted by using 6 questions framework to understand targeted consumer behaviour.

Who are the customers?

There are three main customer segments Kikki.K is looking after. Demographically, Kikki.K targeted customers are females in their early 20s to late 30s who can earn moderate to high income. Mostly they are either university students, white collared workers, or creatives living in the city areas. However, each segment is distinctive in terms of psychological, and behavioural variables.  

For organisers and planners, they are organised, always plan things ahead and focus to achieve their goals. These customers are a kind of perfectionist concerning to their images and social status. Therefore, they look for fashionable and functional products and items assisting in managing their working and personal life. Influencers who trigger problem recognition usually are friends, colleagues or family members.

Memory keepers are another significant targeted segment for Kikki.K. They are creative, imaginative, motivated, optimistic, and romantic. They like travelling around, taking photos and DIY their own stuffs. Memory collectors always write dairies and record their experience. They sometimes share their beautiful moments and some inspiring quotes on social media. Kikki.K ‘s diaries, notebooks and journals could meet the needs of this segment.

Another key segment is gift buyers as Kikki.K products can be used as gifts in special occasions and events. Gift buyers are more likely to be young female over 20 who are attentive and selective. They seek for gifts that look expensive than its real price and are value for money.

Why? And How?

Diagram X: Maslow's Hierarchy of Needs (Maslow, 1943)

In term of customer's need and want, Maslow's Hierarchy of Needs is applied to provide a better understanding and insight of Kikki.K customers. Three consumer segments are motivated by psychological needs including esteem and love & belonging (Aurmanarom, 2010).

Organizers and planners use Kikki.K items to organise and prioritise daily, and weekly activities, and also use as a tool directing themselves to reach the goal by tracking their behavioural performance for better self-improvement. Furthermore, Kikki.K products such as planners enhance users' self-concept and image of being organised (Aurmanarom, 2010), therefore, esteem needs motivate them to purchase.

While stationery goods and paper are used by memory keepers to collect their memorable experiences with friends and family in order to fulfil the needs of Esteem and love & belonging. Once they look at those memory-keeping books again, it recalls positive emotion and pleasure feeling back to life again.  

For the gift buyers, as they are having a need of love and belonging, gift-giving provides them closer relationship and connection with receivers (Aurmanarom, 2010). In addition, giving gift also enhances gift-buyers images of their taste and social status.

What Criteria?

According to Product Review (2018), Kikki.K consumers mentioned simplicity and cuteness of product design as their most important criteria when choosing the brand over other competitors. Besides, they also consider functional benefits such as having greater product quality and good services. Since this product category is price-driven ("The human touch - Kikki.K brand profile", 2012), price has become another key factor customer use during decision-making process. Additionally, product customizability also influences consumer consideration as they are creative and like to DIY the items themselves (Product review, 2018).

When do they buy?

Based on Kikki.K product usage, most consumers in organizer & planner and memory keeper segments probably purchase the paper and stationery goods at certain time, but the frequency and period of purchase that gift buyers will buy is uncertain. Organizers are most likely to buy planners and calendar once a year, and buy notebook and writing instruments such as pen, and stamps a few times a year. For memory keepers, they may buy diaries every 3 month ,as writing diary is their routine, and occasionally buy scrapbook with the accessories for decoration. While gift buyers also occasionally buy Kikki.K products depending on the situations, but they are more likely to purchase greeting cards more often.

Where?

Due to growing online shopping, young Kikki.K customers would search for more information through online channels, and recommendations from family, friends or co-workers. Thus, online store will be one significant method that they reach to the product. Since  the Kikki.K products are priced higher than competitors, some customers prefer visiting physical store to see the quality and shop at the store. Stores in department stores are another channel they will drop by.

4. Internal analysis:

This section includes an evaluation of the internal strengths and weaknesses in the form of a table, as well as utilising Porter's Value Chain as a framework of analysis.

Performance Analysis: Resource, Capabilities and Competencies

 Competitive Advantages

Kikki.K gains competitive advantage (differentiation) by delivering superior value of unique and aspirational design of their products, which are difficult to be imitated by others (“Kikki.K – a Brilliant Retail Brand Differentiated by Design,” 2018).

http://www.trulydeeply.com.au/2011/12/kikki-k-brilliant-retail-brand-differentiated-by-design/

Marketing strategy and performance

Kikki.K's positions as a fashion stationery company, offering products with Scandinavian design (Y, 2008). With the clear strong core concept and design, the company can control the elements and details of strategy well, such as the decoration of brick and mortar stores and online store. Therefore, everything works aligned to each other and reflect the brand's identity and commitment (Kaur, 2016).   

https://www.dynamicbusiness.com.au/entrepreneur-profile/swedish-success-kristina-karlsson-kikkik.html

https://www.referralcandy.com/blog/kikki-k-marketing-strategy/

Financial position

Kikki.K's financial position becomes stronger as it has a strong supportive backup from enormous shareholder such as the Myer family. Although Kikki.K has lost since 2016 due to the cost of overseas expansion, CEO, Lain Nairn believes that this situation would continue in 2018 as it is their long-term play (Company360, 2017; Mitchell, 2017). Nevertheless, the controversial issue was risen that Kikki.K had not paid penalty rates for their employees. Therefore, the CEO solved this by paying them legally that it would eventually impact on returns (Marin-Guzman, 2017).

Company360

https://www.afr.com/business/retail/kikkiks-overseas-expansion-comes-at-a-cost-20171012-gyzdau

https://www.afr.com/news/policy/industrial-relations/kikkik-exposed-to-higher-labour-costs-after-revelation-it-pays-no-penalty-rates-20170412-gvja7g

Management and leadership

Kristina Karlsson, a founder of Kikki.K, has strong passion, high level of leadership skill, as well as growth mindset which affect to her employees. Her passion for design and business obsession become the core of company which propel the company's growth (“The founders of Kikki . K have a powerful Vision for the company,” 2015)

.

https://www.galvinrowley.com.au/news/the-founders-of-kikki-k-have-a-powerful-vision-for-the-company/9481/

Human Resources

Ability to launch new product in the stores in every three weeks (Kaur, 2016) can prove that Kikki.K has a strong design team, capable of producing high quality workpiece in very limited time.

https://www.referralcandy.com/blog/kikki-k-marketing-strategy/

Research and Development

Kikki.K is the company that has a ton of research behind their success. Before Karlsson launched her brand, she had conducted market research by using focus group technique and found the gap in the market, her business opportunity (Rosenbaum-Elliott, Percy& Pervan, 2015). Likewise, due to the strong concept and design, Kikki.K has its own pace of potential growth, such as the category extension from stationary to homeware.

Book: Strategic Brand Management by Richard Rosenbaum-Elliott, Larry Percy, Simon Pervan Published in 2015**

Operations (production capabilities and supply)

Kikki.K has 80 stores in Australia, United States of America, Singapore, United Kingdom, Hong Kong, and New Zealand in 2016 (PwC, 2016). Plus, the brand has a strong worldwide partnership with other retailers to expand its wholesale business (“Wholesale partnership,” 2018). In 2017, the company was in the process of planning and preparing a second distribution centre in Asia to decrease time of transportation (Abada,2017). Furthermore, Kikki.K would officially open 400 wholesale doors around the world by the end of 2018 and more than 3000 wholesale doors in the coming years (“Kikki.K to accelerate global growth,” 2018).

https://www.pwc.com.au/pdf/pwc-retail-consumer-deals-digest-may-2016.pdf

https://www.kikki-k.com/au/wholesale.html

https://12-apicsau.cdn.aspedia.net/sites/default/files/uploaded-content/field_f_content_file/supply_chain_plainning_innovation_summit_2017.pdf

https://www.insideretail.com.au/news/kikki-k-to-accelerate-global-growth-201803

Inter-functional Coordination

According to employee review, most past employees inform that there is a nice, fun, and supportive environment. However, some employees give negative comments, such as lack of training and poor communication with the management team (“Kikki.K company reviews,” 2018).

https://www.seek.com.au/companies/kikkik-434369/reviews

According to the secondary research, the first and most noticeable critical success factor of Kikki.K comes from the founder, Kristina Karlsson (see “Management and Leadership” in Table X). Not only “Kikki.K” originally comes from her nickname, but the core concept of the brand is purely generated from her passion in design. Another CEO of Kikki.K, Russell Parker, also praise that Karlsson has strong leadership skills, positive attitudes, strong belief in herself and her team, tactical managerial skills in human resources, high abilities to adapt, adjust, as well as manage the problems with innovative solutions (“The founders of Kikki . K have a powerful Vision for the company,” 2015). These valuable skills of her directly impact to the team in form of both physical actions and mental support which boost their performance and spirit. Likewise, importantly she is viewed as a successful business woman who most women, Kikki.K's target customers, admire. Therefore, she becomes one of the key component of their brand image.

https://www.galvinrowley.com.au/news/the-founders-of-kikki-k-have-a-powerful-vision-for-the-company/9481/   

Another success is the strong and valuable insight from conducting market research. Karlsson revealed that she even conducted the market research before launching the brand, which means that she ensured her idea with real data to find the gap in the market and gain competitive advantages in the long run. Because of the insight, Kikki.K owns unique and clear concept design which no one can imitate, and it further intelligently paves the way for its potential growth by its nature. To illustrate, they expand their product line from stationary category to homeware product categories, having the same concept design as if both are taken from the same house. Additionally, Kikki.K never stop improving their operations and performance to excite their customers every year. They always keep researching and learning regarding technical skills such as use of material, design, and new formats, as well as updating and responding the upgoing customer trends and external environment in business world (“The founders of Kikki . K have a powerful Vision for the company,” 2015).

https://www.galvinrowley.com.au/news/the-founders-of-kikki-k-have-a-powerful-vision-for-the-company/9481/  

According to Figure X, Kikki.K outsources its production process from finding materials to produce the final products. The materials and the printing press are hired differently for each type of product. For instance, most paper product are sourced from China, but cotton paper for producing letterpress cards are sourced from the US. (Dow, 2012). https://www.smh.com.au/lifestyle/paper-giants-20120531-1zjq5.html  The key is that outsourcing might cause higher supplier power and less opportunity to gain economies of scale; however, in another perspective, it allows the company to focus on solely marketing and sales without worry regarding procurement and production. Through this strategy, Kikki.K has concentrated on retail management to serve the meaningful experience for their customers, instead of holding cost leadership position like OfficeWorksOfficeworks. Firstly, they create value through their brick and mortar stores which can reflect their core concept and value proposition straightforwardly. Not only their products give the sense of inspiration and empowerment (), but also the store layout and service minded staffs can deliver those brand feeling through its structure and their actions respectively.  The brand also received the in-store customer experience award in 2016 as they best delivered seamless service across different channels (). Plus, Kikki.K works hard on building strong customer relationship and engagement by creating and offering  loyalty program, gift vouchers promotion, discount promotion for students, and workshop (Figure X).

To conclude, tactical management and leadership of the CEO, strong support of research and gradual development, as well as creating value in marketing and sales activities are the critical success factors of Kikki.K.

 https://www.commercialrealestate.com.au/news/the-australian-retailers-who-have-found-success-in-tough-times/   

https://internetretailing.com.au/online-retailers-shine-at-inaugural-retailer-awards/   

https://www.sbs.com.au/news/small-business-secrets/article/2017/12/07/kristina-karlsson-never-take-no-answer  

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Conclusion: Problem and Opportunity Statement

In conclusion, while Kikki.K has developed close relationships with existing customers and fans, one problem that can be addressed is that their customer scope may be limited, even unintentionally not appealing to or servicing the younger, teenage market. In this area, Kikki.K loses out to a large number of existing consumers that are catered to by brands such as Smiggle and Typo. Alongside this key issue, threats from the macro-environment exist in the form of changing consumer lifestyles and heightened digitalisation, as well as a rise consumer demand for environmentally-friendly products and packaging.

However, with the above evaluations and analysis, we still conclude that Kikki.K has a number of critical success factors in the form of well-established product design and differentiation, research and development capabilities, as well as inspiring top-level management and leadership. Other opportunities still exist in enhancing Kikki.K's marketing and brand presence, both online and in physical retail stores in order to improve the brand's standing in the industry and meet changing consumer demands.

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