MARKETING, FASHION MARKETING AND LUXURY MARKETING
What does marketing do in fashion companies?
December 6, 2017
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What is marketing?
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“ I see no small car in the parking!”
What is marketing?
“The science and the art to create value for client” (2004)
“The art and the science to select the market to save existing clients and to get new ones, creating, transferring, and communicating a superior value to clients”(2010)
– Science (method, rational, deducting-> left half of brain)…
– Art (emotion, spark, intuition-> righ half)
– To create value (soemthing precious for what we are available to spend time and money)…
– Client (someone with specific needs expectations, desires, not everyone)
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Marketing?
Object Example FASHION
Goods Shampoo Bags
Services Hotel Delivery
Events Olympics In store events
Experineces Disneyland Shopping experience
People Lady GaGa Celebrity marketing
Places Las Vegas Flagships
Property Real Estate Hotels
Organization No-profit Foundation
Information Government CRM
Ideas Mktg politics Environment
Marketing
What is marketing?
1. INTEGRATED MARKETING
2. RELETIONAL MARKETING
3. INTERNAL MARKETING
4. PERFORMANCE MARKETING
Marketing System
What is marketing?
What does marketing do? INTEGRATED MARKETING
ACTIVITIES TO CREATE, COMMUNICATE AND BRING VALUE TO CUSTOMER
PRODUCT PRICE PLACE PROMOTION
•Quality •Range •Sizes •colours •wearability •combination •Design •Materials •Services •Packaging •…
•Trade list •Retail list •Discount •conditions •Sales •Special offer •…
•Channel •Location •Coverage •…
•Advertising •PR •Windows •EventisWeb •….
1. Value to market > different activities 2. Coordinated 3. Very rarely in fashion company a
marketing office responsible for all these activities exists
ACTIVITIES TO CREATE AND MANTAIN STABLE RELATIONSSHIP WITH RELEVANT SUBJECTS
CLIENTS
Dealers and final customers
SUPPLIERS
Important (es. limited materials– Gore-Tex)
LICENCEE
Glass, watches, fragrances…
FRANCHISEES
Mono brand
CREDITORS
Banks
SHAREHOLDERS
Silent owners
UNIONS
SECTOR INFLUENCER
Fashion press community, ecc.
FINANCIAL COMMUNITY
Opinion leader for banks and SH
BUSINESS COMMUNITY
Opinion leader for potential business partners
JOB MARKET
talents
PUBLIC OPINION
Company judgement and target influence
POLITICS
What does marketing do? INTEGRATED MARKETING
What does marketing do? In summary……
• To know and to read the markets: inside and outside the organisation, competitors wise, client wise and distribution wise…
• Strategy and marketing plan development: to respond to market thinking forward
• To talk to clients: to create value for selected target
• To build strong brands: the base for company success and customer relationship
• To Transfer Value: relationship, channels, network
• To communicate value: to make value perceptible and desirable
• To create a long term growth: creating value for the company itself means long life
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A always valid marketing and management tool
Swot Analysis
• A SWOT analysis is an organized list of your business’s greatest strengths, weaknesses, opportunities, and threats.…
• Strengths and weaknesses are internal to the company (think: reputation, patents, location). You can change them over time but not without some work. Opportunities and threats are external (think: suppliers, competitors, prices)—they are out there in the market, happening whether you like it or not. You can’t change them.To talk to clients: to create value for selected target
• Existing businesses can use a SWOT analysis, at any time, to assess a changing environment and respond proactivelyTo Transfer Value: relationship, channels, network
• New businesses should use a SWOT analysis as a part of their planning process.
• In any case, the point of a SWOT analysis is to help you develop a strong business strategy by making sure you’ve considered all of your business’s strengths and weaknesses, as well as the opportunities and threats it faces in the marketplace.
Marketing in Fashion Companies
• Very often a real marketing office does not exist in fashion company
• Most of the time the organisation model is based on referring marketing activities to other company department (style, sales, production, communication)
• In family company sometimes the owner (especially if designer) makes marketing by himself
• Today in structured company marketing dept. exist, with a special focus on digital marketing (we’ll dedicate one class to digital)
• Right or wrong the key point is to produce value for costumer and stakeholder effective marketing
Marketing in Fashion Companies
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STYLE MATERIALS MANUFACTURING SALES COMMUNICATION
Marketing in Fashion Companies
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S M M S C •In the fashion system style is the first element that contributes to brand positioning
• Style follows trends
• Companies “of success” are able to maintain a consistency in their style and their positioning.
•The big challenge for a style is to make a brand “time proof” and loyal with itslf
Marketing in Fashion Companies
•Style is normally imitated, and too sensitive to follow other successful brand.
•It’s difficult to create a distinguished position through style
•Materials are today a strong element for differentiation: performance materials, particular leathers, eco materials,
• Communication emphasis is more and more on materials than style
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S M M S C
Marketing in Fashion Companies
•The “Made in” fix brand positioning (es. “Made in Italy” in Asia
•““Hand Crafted”: the hand made perception adds value to the brand
•District: specific production areas focused on particular merchandise categories, skills and ability
•Sustainable: client is more and more sensitive to eco friendly products, human rights protection for work condition, organic materials
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S M M S C
Marketing in Fashion Companies
• “Retail mix” is a strong component for brand positioning
•Location: brand and product normally have a different perception according to the store location(es. Corso Vittorio
Emanuele II vs Montenapoleone; Ginza vs Omotesando; Oxford St vs Old Bond St.)
•Some multi-brand store become so important to influence brand prestige (i.e. 10 Corso Como; Colette; ecc.)
•Consistency in store location is fundamental also in geographical terms(i.e. Montenapoleone, Avenue Montaigne, Via
Condotti, Ginza, Sloane Street, Causeway Bay, Rodeo Drive, etc)
•Parallel distribution: brand downgrade
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S M M S C
Marketing in Fashion Companies
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S M M S C
•Communication together with product is the main element for brand building
• Leverages:
– Comm Style: aggressive, sexy, ironical, soft, encouraging
– Communication mix: advertising vs PR, celebrities vs testimonials, Direct Marketing vs events …
– Media mix: online vs offline, press vs outdoor,…
Marketing in Fashion Companies
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S M M S C
“ Our products are made to make people dreaming ” (Bernard Arnault)
“ Gucci is the business of selling dreams” (Robert Polet)
Strategic Plan
COMPANY Mission
SWOT analysis
OBJECTIVES
STRATEGY
Planning
Implement
Control
Feedback
Marketing segmentation and target definition
• Marketing is the way of thinking of the entire company, marketing should involve all the company level, marketing is a GM thing, marketing office is just a tool....
• Our consideration came to some conclusions:
• Generally the fashion company (in particular the family ones, the Italian ones)
do not have a structured marketing office but marketing actions are split through the other offices.
• Generally it’s difficult to find in fashion sector (and not only in fashion sector) proper and structured strategic and marketing plans. It’s even more difficult to find strategic plan followed in monitored in all their stages.
• Generally Anglo Saxon and North Americans culture are more familiar with a planned approach to business than Latin
• Not always an organised, structured and planned approach to business and marketing is synonymous of success but it helps
• All these consideration are generally valid not always valid...there always exceptions
Marketing segmentation and target definition
Mass Marketing: no segmentation one product for all the clients. Ford T: “every colour, but black”
A Segment is a group of customer sharing similar (not identical) needs.
Company has to identify the segment and to select the target inside the segment (a group of clients)
Focus (strong point)
Marketing segmentation and target definition
Niche market: restricted segment attractive when:
is not occupied by competitors
Clients are available to spend more to satisfy specific needs
To build profit through specialization
Local Marketing
Segmentation according geographical feature of clientele (HSBC, City Bank)
Individual Marketing
Customization: one to one marketing, segment of one. Needs are satisfied with a made to measure approach. Client make the product.
Marketing segmentation and target definition
Segmentation variables
Geographical
Demographical
Age
Life stage
Sex
Income
Generation
Social class
Psico-graphical
Behaviour
Occasion
Advantages
User Status
Use frequency
Purchase tension
Brand loyalty
Attitude
Marketing segmentation and target definition
P1
P2
P3
P
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P
2
P
3
P
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P
2
P
3
P
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P
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P
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P
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P
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M1 M2 M3 M1 M2 M3 M1 M2 M3
M1 M2 M3 M1 M2 M3
P= PRODUCT M= MARKET
Marketing segmentation and target definition
Luxury market
4 Luxury ideas:
- Authenticity and uniqueness (RR, Cartier, Hermes)
- Creative Niche (JP Gautier)
- Secure values and prestige ( LV, Porsche)
- Exceptional brands (Chivas, Mercedes)
Logo or product?
Marketing segmentation and target definition
To break to show off
Sense of belonging to an aspirational world
logo Product
value
UK (niche)
US;
CHINA (exhibition on
self stories)
FRANCE (authentical,
descrete)
RUSSIA (excess)
Brand Equity and Branding Strategy
What is a brand and how brand strategies works?
What does it mean “brand equity” how can we manage it how can we measure it?
Which are the main decisions related to a brand strategy?
Brand Equity and Branding Strategy
Strategic brand management plans and makes action
addressed to build, to measure and to manage the brand
aiming to maximize its value:
- Fix the proper brand positioning STP (Positioning: the art, and the science to set the offer and the image of the company in order to reach a distinctive placement on target market)
- To plan and to implement a marketing and brand strategy
- To measure the brand performances
- To increase and to protect the brand value
Brand Equity and Branding Strategy
Brand: “name, term, sign, symbol, logo or their
combination, supposed to identify goods and
service with the main purpose of differentiation
form the competitors. These differences can be
tangible and related to product performances or
symbolic, emotional and related to what brand
represents”
Brand Equity and Branding Strategy
Branding: to give goods and services the brand
power.......to create value for the brand
Brand Equity: it’s an immaterial resource, it is the added value brought the to
goods and services by variable such as
- brand loyalty
- brand awareness
- quality perception
- mental association
- copy right/patent
- distribution channels
- technologies
And that influences the way the consumer think of the product, the price policy,
market share and profitability
- Index CBBE
Brand Equity and Branding Strategy
Branding strategy: The decisions to use the distinctive elements of the brand for
new or existing products.
Concept Definition
Brand Extension Use an established brand for to launch a new product
Sub-brand To link a new brand to and existing one
Parent Brand Existing Brand that creates a brand extension
Line extension To use a parent brand for a new product to a new segment
Category Extension Parent brand for a new category
Brand line Specific brand for a line of product
Brand mix All the product lines under the same brand
Brand Variant Specific brand line for specific channels or distributor
Licensed Product To use the name for an external production and/or distribution
Marketing Plan: competitive scenario (environment)
Company
Competitors
Channels Customers Suppliers
Macro-environement
Macro-environement
The play ground where we play the game
Marketing Plan: competitive scenario (environment)
• A crucial factor to take into account for a marketing plan is the company itself
– History:
– Original intuition,
– Core products”,
– markets,
– Production/industrial structure
– People:
– Involvement, motivation, skills....
– Industrial relationship quality
– Competiveness ability
– Brand:
– Material contents(products : HW)
– Non material contents, value(SW)
Marketing Plan: competitive scenario (environment)
HIstory:
– Young company (20 years)
– Clothes
– Human and professional relationship
– Industrial structure already existing
The People:
– Designers leadership and visibility
– Industrial culture
– growth
The Brand:
– HW: large range, wearability,
– SW: sexy, trasgrssive, animalier, barocco, Sicily
Case history: DOLCE & GABBANA
Marketing Plan: competitive scenario (environment)
• Present Costumers:
– Geographical area: culture, consumption habits.....
– Social demographical: age, culture, behaviour
– brand loyalty, store loyalty
• Potential Costumers:
– Geographical area: culture, consumption habits.....
– Social demographical: age, culture, behaviour Let’s try to identify together potential final customers for Dolce e Gabbana
Marketing Plan: competitive scenario (environment)
Competitors: companies/brand fighting with THE COMPANY to get new customers or to improve the performance with the existing ones
• Every action can be compared with the competitors by costumers
• The same action made by different brands can have different reactions
WHO ARE DOLCE E GABBANA MAIN COMPETITORS?
Marketing Plan: competitive scenario (environment)
• Channels, sales share, market share – Organized trade
– Independent retail
– Franchising
– DOS (boutique e flagship stores)
– Mail orders
– On-line
– Outlet
– Duty Free / Linee aeree
– Temporary Stores
– …
• TOPICS:
– Pricing consistency
– Image consistency
Marketing Plan: competitive scenario (environment)
• SUPPLY CHAIN – From raw material to goods for final client
• BAGS: – Leather: selection, sourcing, quality level
– Treatments, handing
– Cut
– Confection
– Transport and logistics
• Company integration
– Value ownership – Independent from suppliers – Control and guarantee of quality standards
Marketing Plan: competitive scenario (environment)
MACRO-environment External variables influencing competitive scenario
• GEO-DEMO
• Macro-economy scenario: energetic shock (ex. oil), international crisis (ex. 11/9), epidemies (es. SARS), emerging market boom (ex. China), etc
• Micro-economy scenario: local contingencies, specific sector
• Politics
• Social
• Laws
• Etc.
MICRO-environment Actors directly involved in production, distribution, and promotion of the product range
• Agencies: marketing, market research
• Communication agency
• Style offices (exernal)
• Material reserach
• Banks
• Agents
• Distributors
• Etc.
KEY TEXTBOOK •Kotler, Keller – IL MARKETING DEL NUOVO MILLENNIO – Pearson Prentice Hall (I) •Kotler, Keller – A FRAMEWORK FOR MARKETING MANAGEMENT – Pearson P.H. (GB) •Kotler, Keller – MARKETING MANAGEMENT – Pearson Prentice Hall (I, GB – Library) •Kotler, Armstrong – MARKETING PRINCIPLES – Pearson Prentice Hall (I, GB)
MARKETING in the FASHION AND LUXURY BUSINESS •Cappellari – IL MARKETING DELLA MODA E DEL LUSSO – Carocci (I) •Corbellini, Saviolo – MANAGING FASHION AND LUXURY COMPANIES – Etas (I, GB) •J.N. Kapferer, V. Bastien – LUXURY STRATEGY – Franco Angeli (I, GB) •Mosca – MARKETING DEI BENI DI LUSSO – Pearson Prentice Hall (I) •D. Thomas – DE LUXE – DeAgostini (I, GB, Library) •Jackson, Shaw – MASTERING FASHION MANAGEMENT – Palgrave (GB) •Foglio – IL MARKETING DELLA MODA: POLITICHE E STRATEGIE DI FASHION MARKETING – Franco Angeli (I) •Saviolo, Testa – LE IMPRESE DEL SISTEMA MODA. IL MANAGEMENT AL SERVIZIO DELLA CREATIVITA’ – Etas (I)