The Fashion Channel

2075
JUNE 1, 2007

WENDY STAHL

The Fashion Channel
Introduction
Dana Wheeler, senior vice president of marketing for The Fashion Channel (TFC), sat in her Chicago office and scrolled through the email messages in her inbox. Thankfully, none required an urgent reply. She toggled over to her calendar: no meetings for the rest of the day. Finally, she could focus her thoughts on reviewingher recommendations for TFC’s new segmentation and positioning strategy. Wheeler believed that she had prepared a solid analysis; she felt confident about the strategy she was proposing. But next week’s senior management meeting would mark her first big presentation to the company’s leaders since she had joined TFC, and, she admitted to herself, she was eager to gain the support of her colleagues.There was a lot riding on the outcome of this meeting, both for Wheeler and for the channel. If founder and CEO Jared Thomas and his team liked what they heard, Wheeler would move forward to implement her recommendations. The company needed to strengthen its competitive position and would be spending more than $60 million in all national and affiliate advertising, promotion, and public relations in2007, based on these recommendations. This would be an increase of $15 million over 2006 spending.

Background
TFC was a successful cable TV network– and the only network dedicated solely to fashion, with up-to-date and entertaining features and information broadcast 24 hours per day, 7 days per week. Founded in 1996 by two entrepreneurs, it had experienced constant revenue and profit growthabove the industry average almost since the beginning. Revenues for 2006 were forecast at $310.6 million, marking another steady upswing.

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Wendy Stahl prepared this case solely as a basis for class discussion and not as an endorsement, a source of primary data, or an illustrationof effective or ineffective management. Wendy Stahl is vice president of corporate development at creditcards.com. She received her MBA from Harvard Business School This case, though based on real events, is fictionalized, and any resemblance to actual persons or entities is coincidental. There are occasional references to actual companies in the narration. Copyright © 2007 Harvard Business SchoolPublishing. To order copies or request permission to reproduce materials, call 1-800-545-7685, write Harvard Business School Publishing, Boston, MA 02163, or go to http://www.hbsp.harvard.edu. No part of this publication may be reproduced, stored in a retrieval system, used in a spreadsheet, or transmitted in any form or by any means—electronic, mechanical, photocopying, recording, orotherwise—without the permission of Harvard Business School Publishing.

2075 | The Fashion Channel

The channel was also one of the most widely available niche networks, reaching almost 80 million U.S. households that subscribed to cable and satellite television.1 Women between 35 and 54 years were its most avid viewers, according to its annual demographic survey. But beyond basic demographics, thechannel didn’t have much in the way of detailed information about its viewers. Nor did it attempt to market to any viewer segments in particular. From the beginning, in fact, Jared Thomas had believed that TFC’s marketing messages should appeal to as broad a group as possible in order to achieve the highest possible viewership numbers. Early on, the network had chosen “Fashion for Everyone” as thetheme for its marketing programs; one of its more popular series in 2005 had been “Look Great on Saturday Night for Under $100.” TFC had clearly grown quickly without articulating any detailed segmentation, branding, or positioning strategy. However, at the beginning of 2006, the network realized that other networks were taking note of its success and beginning to add fashion-related programming...