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ID NUMBER: 5148684


Table of Contents



Macro Environment analysis 3

Miu Miu Brand 4

Miu Miu's Strength and Weaknesses 4

Sales Forecasts and Estimates 4

Opportunities and Threats 5



Segmentation 6

Targeting 7

Positioning 7













Compared to South Africa, Brazil and UAE, Mongolia is considered suitable for investment ' APPENDIX 1 - purposes due to;

o An experienced and forecasted higher GDP real growth rate

o Low tax rates payable by companies

o High dollar value exchange rate to Mongolian Tugrik

o Political stability and chosen brand presence lacking

o Lower minimum wage bill and rental prices


Macro Environment analysis

Mongolia is considered a politically stable country, with high government involvement in the form of; reduced mortgage rates translated into an increase in consumer's disposable income despite a minimum wage bill of $0.63 per hour. Its economic environ experiences an increase in foreign direct investors due to Mongolia's oil and copper resources, that has led to a growth in credit facilities. Social environment faced with an increased consumption of international brands and rise in entertainment spots. With a favourable investment law, levelling the business field for both locals and foreign investors.


Competitor brands 'APPENDIX 3: Figure 10 - have a customer base of at least 1000 Mongolians per month (APIP 2013). Thus an anticipated potential customer base to be achieved of at least 600 per month. Related to identified buyer behaviour and willingness to spend on luxury quality goods added with the perceived superiority of international brands ' APPENDIX 1: Figure 2.  

Competitive Situation

With the rapidly growing economy ' APPENDIX 1 'Mongolia is experiencing a Real GDP growth rate than its other emerging countries, has seen a boom in luxury entrants who have made their presence well known. Brands like Louis Vuitton and Zegna have set up stores within the capital, Ulan Bator's prime retail spaces ' APPENDIX 2.

Both premium and bargain luxury brands have experienced a good customer turnover, related to; huge store design, services offered and high quality in-store shopping experience rendered to customers, enabling likes of LV to offer their handbags at a retail price of $1,700 (Donahue 2014).  

Local market trends

Despite an increased annual per capita expenditure on clothing over 500% since 2003-2011, luxury brands have to deal with the accessibility of counterfeit luxury branded products being brought in from neighbouring China and sold at the city's legalised Narantuul black market due to the imbalance in income distribution (MAD 2013).

Miu Miu Brand

A subsidiary brand under the Prada Group's and is considered a leading fashion brand in the world based on; creativity, quality and innovation. Its;

' Style is describes as; sensual, provocative and sense of freedom/intimacy, quality and detailed.

' Target is particularly women, aware of latest trends and explorative fashion choices.

' Part objective is to expand retail activities to all leading markets, reflective of its financial strength ' APPENDIX 5.

Miu Miu's Strength and Weaknesses

Strengths ' High quality clothing and design targeting fashion conscious woman

' Financial stability

' Access to internal investment from parent company

Weaknesses ' Clothing offered not distinct from luxury competitor brands present in Mongolia

Sales Forecasts and Estimates

Estimates identified in relation to competitor brands pricing and average monthly customer turnover.

Estimated customers 600 per month 800 per month

Estimated spend $ 1,200 per person $ 1,200 per person

Estimated sales turnover $ 720,000 per month $ 960,000 per month

Estimated sales turnover 9,800,000 by year end 2015 $ 11,520,000 by year end 2016

Opportunities and Threats

Consumer buying behaviour and spending power in Mongolia's city, Ulan Bator within generation x and y segment having high disposable income. They present an opportunity for niche marketing strategy suitable for high priced luxury brands.

Opportunities Threats

' Local perception of uniqueness and quality related to international luxury brands (Bruce 2004:9)

' Rise of entertainment buildings and upcoming 'The Village ' Billionaire valley '

' Women have higher disposable income

' Convenient investment laws (APIP 2013) ' High and ease access to substitute branded products

' Competition from other established luxury brands

' Weather conditions

' Sparse population

' 51.4% of population are women


The brand's operation in Mongolian market will, focus on three objectives for the two year period September 2014 to September 2016.  

I. Create brand awareness

II. Customer acquisition and satisfaction

III. Achieve sales turnover of $20,000,000 by 2016

Through; maximising on its distinct store shopping experience, offering consistent and quality in-store and after-sales services and providing a selected range of products in response to consumer demand.


Strategy will be focused on achieving customer value through building on customer intimacy and product differentiation to generate sales. Similarly, engaging in local community development after the first 4months, through funding five fashion students at Mongolian International University. This will allow for a positive brand image and influence on its reputation.

Entry strategy

 Miu Miu's will adopt a direct investment strategy solely retailing its own brand products. This will allow the store to offer replicated products with a selected product range, to cater to Mongolian market. In order to satisfy the demand and taste of the target market, there will be need for a decentralised management and buying structure (Bruce et al. 2004: 23, 69). Setting up store with management having full ownership over the brands operations.

GAP Analysis

The environmental and competitor analysis identified a gap between, consumer; demand for price consistent brands and a growing demand for conspicuous consumption from Mongolian millionaires seeking a luxury shopping experience to match value for money (Munkhjargal 2012). The market potential available is based on current presence of few luxury brand retailers in a local market experiencing a 500% growth in retail sales from 2003 -2011 (APIP 2013)


Demographic Focus on Generation X and Y (Age 25 ' 50years)

Mainly stock on Female products

Focus on professional, managers and retirees

Wage bracket 50,000 ' 250,000 per year

Psychographic Focus on;

Lower uppers to Upper uppers social class consumers

Outgoing achievers attracted to statement clothing

Analysis of the Mongolia, identified Generation X and Y segment due to growth in their spending power. This attributed to the rise in commodity pricing and an increase in foreign investors towards the country's mining industry.

The brand will majorly focus on stocking 80% on female clothing and 20% on male. Due to the population distribution of women in professional levels being higher than that of men.


The decision on the commercial viability of Mongolia is considered on the basis competitors experiencing high profit per unit sales on the small target market of at least 1000 people. This indicating an opportunity for Miu Miu should adopt concentrated (niche) marketing, in order to avoid causing a price war with present and established luxury brands.


An analysis of customers brand perception of both MiuMiu and other luxury brands in the global environ and the target foreign market, positioned MiuMiu as a premium brand. This is due to; perceived physical appeal, origin in relation to being an international and consumers considering Italian brands to be high quality, thus highly priced.

Low quality

    High quality

Some of the luxury premium competitor brands; LV, Burberry and Zegna are considered to have a higher price and quality in the target market than MiuMiu, due to an already established store presence that has enable them attain a loyal customer base. Whereas, Espirit and French connection are considered as luxury bargain brands.


Promotional Mix

The communication process for MiuMiu will involve an integrated promotional mix of; advertising, sponsorships and holding of fashion exhibitions.

1. Advertising

An integrated selection of both above the line ' TV and magazines, and below the line advertising to initially inform and create interest towards the brand aimed at the target segment.

The identified channel, TV5 is privately owned and suitable to reach the target market. While magazine publications will be done under the once per month.

Below the line advertising will involve outsourcing services from New Marketing Media agency who will work on the brand logo and email campaigns services, with Miu Miu's management maintaining full control of the campaigns.  The agency will also be responsible for printing the brands magazine reflecting local outfits and trends available in the store.

2. Sponsorship will be on a yearly basis of five best fashion students in Mongolia International University, with internship provisions offered.

3. Exhibitions will be conducted within Ulan Bator's entertainment spots and malls, as a pull strategy to allow for more acquisition of potential customer and retention of established customers.



Due to an already existing demand of Miu Miu's clothing brand in Mongolia through online access from websites like; Rakuten and Global-Customer, the brand has to focus on setting up store to create a direct experience for customers with the products.

Product assortment offered will feature a selection balancing a colourful reflection of local culture and western fashion from Miu Miu's brand.


The quantity of products offered will be supplied in five dozens per design of its; shoes, dresses and handbags, in order to exercise brand uniqueness perception in consumers' mind, while still satisfying demand.


 In order to achieve such a quantity supply and satisfy customer demand, there is need to build a collaborative relationship with the brand's suppliers and agree on the required order quantity to be supplied and establish convenient protocols for re-ordering. Through maintaining such relations, will allow a quick response supply basis, contributing to a reduction on inventory holding and bulk manufacturing costs from incurring (Bruce et al. 2004: 46, 115).


Adopt a tactical demand-based pricing in view of target segment's response to pricings from current competitor luxury brands. This is also based on the evaluation from the perceptual map. This pricing will also be convenient based on the lowest pricing of $1,150 for a Miu Miu shoe through Mongolian origin websites.


The selected distribution channel will flow from the manufacturer to the retailer to end consumer, so as to facilitate easy and convenient access to target segment. Store location will be within selective Ulan Bator's upmarket entertainment spots.

 The 150 square metres retail space obtained during first year, will be strategically situated at the state department in Peace Avenue.

The amount of space rented will allow Miu Miu enough floor space to customise on its store design and maximise on achieving optimal exposure. The second store will be opened next financial year but at a smaller floor space.

Physical Evidence

Store design will be developed to achieve desired shopping experience value and improve the quality of suggested in-store services. Both stores will undergo alterations  of its window product displays every two months to create more awareness, help in adjusting to seasonal trend and enhance purchase through sizeable merchandising label in-store and smaller labels within window displays (Bruce et al. 2004: 83).

 Similarly integrating the local Mongolian culture dimensions within some of the store design features, in form of a ger shaped fitting room.



Ten different level international personnel will be merged with a select 20 local Mongolian workforce, in order to share knowledge and expertise for suitable running of the retail store. Trainings and seminars will be conducted after every three months starting September 2014. This trainings will allow employees to share innovative and creative ideas local target market and the brand improvements that can be made.   Sourcing and benchmarking of Front-line staff to be conducted by top management as they will be a reflection of Miu Miu as a brand and product offered. They should be trained to be helpful to fully achieve a comfortable purchasing process. Open communication exercised to resolve any arising disagreements


Some of the suggested services to be offered include;

o Personal stylist services

o Flexible opening hours or closing of the store to serve particular customer and upon request.

o Flexible return policy if the item delivered did not fit or meet the customer's tastes.

o Home delivery services for customers living around Ulan Bator or office delivery services to customers both within and outside Ulan Bator's residency. This will require outsourcing of convenient local delivery service agents.

This will enable Miu Miu to reflect the in-store service delivered to after-sales services offered, contributing to good brand reputation.


2014 - 2015 Marketing Budget ($)

  Q1 Q2 Q3 Q4 Year Total


Salaries, bonuses 100,000 100,000 100,000 100,000 400,000

Market research

Primary data 35,000 30,000 20,000 40,000 125,000

Secondary data 20,000 20,000 10,000 25,000 75,000

Market communication

TV 150,000 150,000 100,000 130,000 530,000

Magazines 60,000 60,000 30,000 60,000 210,000

Events 50,000 20,000 30,000 100,000

Channels 260,000 260,000 250,000 250,000 1,020,000

CRM 40,000 40,000 40,000 40,000 160,000

Employee Seminar & Training 60,000 60,000 30,000 50,000 200,000

Total  Marketing Expenditure 2,420,000

Contingency 980,000

Other (Rent) 600,000

Total Expenditure 4,400,000

2015 - 2016 Marketing Budget ($)

  Q1 Q2 Q3 Q4 Year Total


Salaries, bonuses 130,00 130,000 130,000 130,000 520,000

Market research

Primary data 30,000 20,000 10,000 8,000 68,000

Secondary data 15,000 0 10,000 5,000 30,000

Market communication

TV 170,000 150,000 100,000 50,000 470,000

Magazines 60,000 60,000 60,000 60,000 240,000

Events 50,000 0 50,000 30,000 130,000

Channels 300,000 270,000 270,000 250,000 1,090,000

CRM 50,000 50,000 50,000 50,000 200,000

Employee Seminar & Training 70,000 20,000 20,000 0 110,000

Total Marketing Expenditure 2,338,000

Contingency 1,152,000

Other (Rent) 600,000

Total Expenditure 4,610,000


The budget allocation is based on a two year period that will see the store spend more on advertising on marketing communication, research and training due to entry into a new market during the first and second quarter.  To build on brand exposure, create interest and maximum awareness to the target segment. Market research will be conducted on a monthly basis to keep track of customer purchases, surveys on satisfied customers and track items returned.

The channels will be in form of agency and delivery services outsourced. Of which the marketing agency service will take up 60% of the channels budget due to level of services required from them; in form of in-store magazine publications, email campaigns as well as tv commercials. While sponsorship will take up 30% of the channel budget.

The magazine budget will be covered every moth through local publications on a privately owned high end fashion magazine. While the customer relationship management will involve allocating of gifts in discount voucher forms to customers who shop beyond a certain price range. This will enable them to create interest and encourage the customer to return for added purchase.

The contingency budget will be used to off-set brand repositioning in the event that the brand does not get he expected reception from the local target segment.


Monitor and evaluate target customers; brand awareness and satisfaction level. Through Market research conducted every three months, collecting data in form of;

o In-store customer satisfaction survey, in relation to purchases made and returns.

o Received customer complaints and effective responses in timely and professional manner to avoid the unlikely hood of customers seizing purchase from the store.

o Monitoring and evaluating of employee performance through forums held every two months in order to determine an acceptable working environment and empowerment through sales target competitions and giving rewards or bonuses.

This is because employees will be a representation of Miu Miu's strength or weakness as a luxury brand (Lohndorf and Diamantopoulos 2014).


Miu Miu should maximise on its availability of financing from its pool as a brand and that of its parent group to invest on needed store design and selected assortment of products. Similarly it should maintain a consistent demand-pricing strategy to its target segment, to avoid customer switching to other competitor brands.

Through investing on research as a new player in the Mongolian market will allow Miu Miu, to keep track and re-evaluate its strategic direction in line with its objectives after every three months. The brand should also focus on maintaining good relations with the local marketing agency to enhance, control and specify the desired message to be communicated.

Finally, having investments set aside for employee development and training and subsequently monitoring the retail operations, will allow them to identify ways in which to minimise future complaints. Serving target customers in the most efficient professional way possible leading to developed loyalty.



APIP (2013) Why Mongolia's retail boom is causing increasing global excitement [online] December 2013. Available from: <> [22 June 2014]

Bruce, M., Moore, C., and Birtwistle, G. (2011) International Retail Marketing: A Case Study Approach. New York: Routledge

Donahue, B. (2014) 'Mongolia's economy is soaring, but at what cost?' The Washington Post [online] September 2013. Available from: < > [11 June 2014]

Focus Economics (2014) Brazil Economic Outlook [online] May 2014. Available form: <> [11 June 2014]

Lohndorf, B., and Diamantopoulos, A. (2014) 'Internal Branding: Social Identity and Social Exchange Perspectives on Turning Employees into Brand Champions'. Journal of Service Research [online] 27 February 17(3), 310-325. Available from < > [01 July 2014]

M.A.D (2014) Overview of the Political System [online] August 2013. Available from: < > [20 June 2014]

MAD (2014) Retail Market [online] available from: < > [18 June 2014]

Manral, K. (2014) 'Difference between 'above the line' and 'below the line' advertising'. The Advertising Club [online] August 2011. Available from <> [24 June 2014]

Munkhjargal, B. (2012) 'Luxury Brand Explosion in Mongolia'. The Asia Mag [online] December 2009. Available from: <> [22 June 2014]

Nakamura, M. (2014) 'Multinational Apparel Brands Entering Brazil Despite Entry Barriers'. Euromonitor International [online] February 2014. Available from: <> [12 June 2014]

NationMaster (2014) Economy [online] available from: <> [12 June 2014]

NationMaster (2014) Economy [online] available from: <> [12 June 2014]

Pressly, L. (2014) 'Mongolia on verge of mineral boom'. BBC News [online] April 2010 < > [22 June 2014]

Roberts, A. (2013) 'Lacoste Tops Calvin Klein as Brazil's Most Googled Fashion Brand'. Bloomberg [online] April 2013. Available from: < > [11 June 2014]

The World Bank (2014) Brazil [online] available from: <> [12 June 2014]


Figure 1: PESTLE Analysis

Figure 2: Porter's Five Forces Analysis

Customers ' Positive attitude and growing demand for luxury brands

' Decision making process influenced by brand quality

' High priced luxury brands purchased as a status symbol

' Demand for a luxury shopping experience

' Seek brands that do not have continuous discount offers

Competitors ' Presence of 20 international luxury brands (APPENDIX 3: Figure 10)

' Strategy to create a luxury feel shopping experience

' LV & Burberry customising store design reflecting the Mongolian culture

' Strategic positioning in current and up-coming prime retail spaces

' Expanding their promotional mix e.g. Dunhill through sponsoring polo sport

Distribution ' Available trade channels; Franchises, Joint Ventures, Wholesaling or Sole ownership

Suppliers Locally available cashmere supplier ' Gobi factory

Facilitators & Marketing Organisation ' Accessible tarmac road in & within Ulan Bator

' Lack of adequate parking spaces at entertainment spots and malls

' Availability of local financial institutions and loan access

' Available PR and Advertising agencies e.g. The New Media Creative Studio, Rocket Marketing and Advertising agency




GDP $2.253trillion $10.27billion $384.3billion $383.8billion

GDP Real growth rate 0.9% 12.3% 2.5% 4.4%

Total tax rate 68.3% 24.6% 30.1% 14.9%

Other taxes payable by businesses 3.8% 2% 4.2% 0.8%

Currency Exchange rate ($ against country currency) $1.95 $1,357.58 $8.21 $3.67

Weather patterns Warm-Tropical climate Cold and snowy winters Warm temperate climate (sunny winter, summer rains) Warm 'tropical climate


Other taxes payable by businesses (% of commercial profits). Other taxes payable by businesses include the amounts paid for property taxes, turnover taxes, and other small taxes such as municipal fees and vehicle and fuel taxes.

Total tax rate (% of commercial profits). Total tax rate measures the amount of taxes and mandatory contributions payable by businesses after accounting for allowable deductions and exemptions as a share of commercial profits. Taxes withheld (such as personal income tax) or collected and remitted to tax authorities (such as value added taxes, sales taxes or goods and service taxes) are excluded.



Figure 6: GDP growth rate (2001 - 2018)

Figure 7: Per Capita Income Growth Rate comparison

Figure 8: Income Distribution among Population Figure 9: Growth in Retail Sector

Figure 10: Present Luxury Brand Retailers


Figure 11: Rental Prices

Normal Space

Prime Space



Store Operating Hours Location Clothing Brands Online access


State Department 8.30am-8.30pm daily Chingeltei, Peace Avenue 23 Present& updated

Sky Department 10.30am-9pm daily Behind Chinggis Hotel Present/not updated   

Central Mall - Overlooking Chinggis Khaan square LV, Emporio Armani, Burberry, Zegna -

Ulaanbaatar Department 10am-10pm daily Peace Avenue 57 Local cashmere; Goyo, Gobi, Buyan -

Naran Plaza 10.30am-9.30pm daily Sukhbaatar District, Peace Avenue 1 Espirit, YSL, Kenzo Present &updated

Khanburgedei Department 10.30am-8pm weekdays

11am-7pm weekends Bayangol District, Zamchdiin street CK, DKNY, Cerruti, Dunhill, Naf Naf, French connection, Gery weber, Lagerfeld Present &updated



Figure 12: MiuMiu Sales Performance

Figure 12b: MiuMiu Sales Performance  


Figure 13: MiuMiu Number of operational stores


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