HBR: The Fashion Channel Case
Case Report #1: The Fashion Channel (TFC)
The Fashion Channel (TFC), founded in 1996, was a successful cable TV network solely dedicated to fashion-oriented programming along with offering the latest information on the fashion industry broadcasting 24 hours a day, 7 days a week. TFC’s initial “Fashion for Everyone” business model was to appeal to broad demographic groups to achieve the highest viewership possible with the primary target audience of women between the ages of 35 – 54. In 2006, TFC forecasted revenues of $310.6 million – with $230 million target profits exclusively from advertising.
Until 2006, TFC was the broadcast market leader in fashion programming. However, TFC was faced
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cable television households. TFC will also gain consumer awareness through advertising to each segment that are made up of 50% and 25% of females within TFC’s target female group aged 18 – 34. If executed effectively, targeting these two clusters will ultimately increase advertising revenue from the bigger proportion of females within TFC’s target demographic. Also with this re-positioning strategy, TFC should invest in production of new programming offerings designed on the consumer needs of the Fashionista and Planner/Shopper audience segments. By doing so, TFC will become a unique fashion-centric cable TV network, distinguishing the cable network from current and future “double-edged” competitors. For example, Investigation Discovery (ID) is a successful cable network that features documentary-style programming involving real-life crime-related stories – criminal investigations, homicides, forensics, etc. There are lots of competitors that integrate crime-related programming into their daily programming blocks – for example, ABC’s 20/20 or NBC’s To Catch A Predator. Investigation Discovery understands their target demographic and continues to launch show after show pertaining to the needs of their target consumer segments, including my personal favorite – Southern Fried Homicide.
Even though the dual target strategy projects attractive ratings and CPM benefits, it requires an additional $20