MA in Fashion Marketing & Branding

Lecture 10 Feb 2014

case study analysis

Prof Garry Honey

Winchester School of Art
Agenda

1.  Stakeholder issues – continuation from last week

2.  Student activity – identify CSFs in case study

3.  Fashion brand theory – demand psychology

4.  Student briefing – seminar preparation

1. Stakeholder issues
Stakeholders are…

‘Any interest group which is affected by the organisation,

plus any group which can affect the organisation’

Note they are not homogenous groupings – people can

be members of more than one group.
Primary Investors
stakeholders Return on Investment
good value

Suppliers Organisation Customers

reliable terms
prompt settlement
Reputation value for money
satisfaction

Employees
appreciation & fair pay
career progression
Secondary stakeholders

Regulators Competitors

Investors

Organisation
Suppliers Customers
Reputation

Employees
Local community Media
Stakeholder priority

•  How significant is each group?

•  For each issue consider – Urgency, Legitimacy, Power

•  Secondary ones can be more significant than primary ones eg media

•  Risk exists where stakeholder issues are ignored for too long.

•  Key is to understand stakeholder expectations and performance against these

•  Either deliver against this or manage expectations upward/downward

•  Risk exists both as opportunity as well as threat

expectation alignment

Exceeding Risk as
align to exploit
expectation opportunity
Exploit
Slightly above Risk as
align to exploit
expectation opportunity

Meeting
No risk in alignment
expectations

Slightly below Risk as

align to improve
expectations threat
Improve
Falling below Risk as
align to improve
expectation threat
expectations

Regulators
competent management Competitors
code compliance No threat!
Investors
Return on Investment
good value

Suppliers Organisation Customers

reliable terms
prompt settlement
Reputation value for money
satisfaction

Employees
appreciation & fair pay
Local community career progression Media
considerate behaviour stories to boost readership
VFM? societal issues
stakeholder
engagement

1. Think Strategically
2. Analyse & plan
3. Strengthen engagement capacities
4. Design the process & engage
5. Act, review & report

Source – UNDP manual

Why engage stakeholders?

•  To manage expectations – reduce surprise

•  To monitor sentiment & ultimately determine value

•  To mitigate reputation risk

•  To retain support of key stakeholders

•  To secure mandate to continue to operate

communication strategy - external

high EDUCATE MANAGE

CLOSELY
power
eg regulators eg investors

WATCHING CONVINCE
low BRIEF
power
eg public eg media

low high
interest interest
 2. Student activity
•  Split into your seminar groups (6)

•  Each group find an area to work in for 20 minutes

•  Each group list 10 significant factors in Warby Parker success

•  Aim is the rank Top 10 Critical Success Factors

•  Note this is an exercise in judgement based on case study

One view…..

1.  Market Analysis – identifying the niche opportunity

2.  Business Proposition – the positioning against competitors

3.  Resource Allocation – skills clusters by up and downstream

4.  Brand Pillars – 4 key aspects of the brand philosophy

5.  Component sourcing – Supply chain negotiation & China

6.  Funding – Note banks not helpful but PE liked the order book

7.  Trial programme – disruptive strategy to gain traction

8.  Capacity management – customer experience crucial

9.  Distribution expansion – application of retail stores

10.  Expansion & staffing – Culture of fun and social mission.
3. Fashion brand issues
Brand is …….

Buyable - financial or emotional product

Reassuring - consistency and quality

Association - with attributes and values

Name - for this reassurance & association

Distinctive - competitive proposition & appeal

……a consumer proposition created & managed for sustainable revenue

Social signals

•  Brand as non-verbal communication

•  Brand as a signal of association

•  Association with a set of values (aspirational)

•  Association as part of projecting self-image

•  Brand choice is always a blend of rational and emotional

RATIONAL

Ornamental Substantial
Frivolous Serious

Scarcity Expense
or rarity or price
eg diamonds, gold eg Maserati

Material Extreme
Form Function
What How

Quality crafted Supplemental

or fabricated or accessory
eg Faberge eggs eg Rolex watch

Manufacture Visibility
EMOTIONAL

Desire or Prestige
aspiration or status
want/covet wealth/power

inward outward
self-worth projection
vanity recognition

Self - indulgence Decoration

or gratification or statement
pamper/reward ostentation/display
Wristwatches

Fashion Brands Luxury Brands

Swatch - £50 Breguet - £25,000

Swatch group

Level Brands Price

Prestige & Luxury •  Breguet £7,500 - £30,000

•  Omega
High Range •  Longines
•  Rado
Middle Range •  Tissot
•  Calvin Klein
Basic Range •  Flik Flak
•  Swatch £40 - £120

http://www.swatchgroup.com/en/brands_and_companies/watches_and_jewelry
Brand attributes

Priority Fashion Brand Luxury Brand

1 Design, ‘style’ Price (high), Quality,

aesthetics, ‘look’ craftsmanship, value

2 Modern, youth, Timeless, Classic,

change, transient mature, exclusivity

3 Follower appeal Limited availability

Tribal for traction Individualistic (?)

4 ‘Noisy’ brand, ‘Quiet’ brand, discrete,

distinguishable often understated

5 Price (accessible) Design, style,

Herd mentality aesthetics, ‘look’
Brand messages

Brand Overt Message Subliminal message - psychology

Quiet brand Discrete – understated, private ‘ I buy this brand because I appreciate the
or invisible eg a private bank or quality of craftsmanship, not because I
quality underwear! want others to know about my choice’

Noisy brand Visible – displays wealth & ‘ I buy this brand to demonstrate my
implied superiority. Can tend to purchasing power and to create envy
be vulgar eg sports car brands among my peers – it is pure ostentation’
 Brand signals

Brand Overt Message Subliminal message - psychology

Hollister, Super ‘I belong to this group’ ‘I fear not belonging’ (latent insecurity)
Dry, Jack Wills ‘This is my chosen tribe’ ‘Brand association gives me security’
‘My self image lies here’ ‘I feel more self-assured wearing this’

Swatch & other ‘I feel good wearing colour’ ‘I fear being seen as conventional or old’
colourful brands ‘This is fashion jewellery’ ‘Brand association makes me younger’
‘I am stylish & fun’ ‘I feel more desirable wearing this’
Expression through brands

Brand Consumer profile Subliminal message – psychology

Fashion brands 80:20 self purchase ‘I buy this to feel young & in touch’
‘Wearing it invigorates me’
‘It is delaying the aging process’

Luxury brands 60:40 gift purchase ‘I buy this high value gift in appreciation’
‘By association I show how much I value you’
‘My own purchases are just self-indulgence’
Brand messages

Brand Consumer profile Subliminal message – psychology

Fashion brands Mainly self purchase ‘I project my self-image through this brand’
‘Association with it is part of my identity’
‘If the brand is classy then so will I be seen’
‘I borrow the brand values to support my own identity’

Luxury brands Mainly gift purchase ‘ A high value gift is symbolic of my regard for you’
‘ It is also a demonstration of my purchasing power’
‘ In giving this I am rewarding you & buying loyalty’
‘ I might expect favours/loyalty in return’ (conditional)
An alternative view (cynical)

Fashion brands are for the ‘vain and insecure’ who have low self
esteem and need the reassurance of borrowed confidence.

Luxury brands are for the wealthy, seeking to express their unique
purchasing power either discreetly or indiscreetly.

Marketing demands we distinguish between the two fears –

Fashion-driven - those who fear being seen as unfashionable
Luxury-driven - those who fear being seen as not special enough
Brand risk

For a FASHION brand the risk is –

Failing to maintain a ‘leading edge’, being ‘trendy’ or ‘a la mode’

Failing to maintain a gap which distinguishes it from the pack

In terms of -

a)  product novelty, design etc.

b)  competitive advantage (attributes)
c)  responding to change in consumer attitudes (reaction)
d)  appeal to a youthful audience (fickle)
e)  teenagers do not buy the brands of their parents
Mulberry

One time fashion brand in UK

Now in trouble
Misunderstood its customers

It was a mid price fashion brand

but thought it was a luxury brand

Consumers didn’t agree

Sales declined as products now over-priced

Out of touch with core customers

Brand risk

For a LUXURY brand the risk is –

Failing to maintain an air of exclusivity or ‘cachet’

Becoming too accessible and insufficiently special

In terms of -

a)  Product distribution and price (over-exposure or discounting)

b)  Quality of materials or craftsmanship (viz Mulberry)
c)  The local economy and overall capacity for luxury (austerity)
d)  Association with the ‘wrong’ type of customer (viz Burberry/Bentley)
e)  Vulgarity - often associated with excess, ostentation or ‘bling’
Brand attributes

Priority Fashion Brand Luxury Brand

1 Design, ‘style’ Price (high), Quality,

aesthetics, ‘look’ craftsmanship, value

2 Modern, youth, Timeless, Classic,

change, transient mature, exclusivity

3 Follower appeal Limited availability

Tribal for traction Individualistic (?)

4 ‘Noisy’ brand, ‘Quiet’ brand, discrete,

distinguishable often understated

5 Price (accessible) Design, style,

Herd mentality aesthetics, ‘look’
4. Seminar brief
Seminar brief

Read and digest HBR article Dec 2013

‘When marketing is Strategy’ – Niraj Dawar

Prepare to discuss

a)  The relevance of ‘Downstream skills’ to Warby Parker

b)  There will be group work in the seminar (4 groups of 4 in each)

Seminar sub-groups to consider key Fashion Marketing issues –

1. Market analysis & brand pillars – how WP built the concept

2. Business proposition – how WP created competitive advantage
3. Trial programme – how WP used disruptive strategies for launch
4. Ethical marketing – how WP exploited guilt and social conscience
Seminar issues