MARKETING, FASHION MARKETING AND LUXURY MARKETING · Marketing segmentation and target definition •Marketing is the way of thinking of the entire company, marketing should involve

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


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STYLE MATERIALS MANUFACTURING SALES COMMUNICATION


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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


•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


•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


• “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


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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,…


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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


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)


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.


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


P1

P2

P3

P

1

P

2

P

3

P

1

P

2

P

3

P

1

P

2

P

3

P

1

P

2

P

3

M1 M2 M3 M1 M2 M3 M1 M2 M3

M1 M2 M3 M1 M2 M3

P= PRODUCT M= MARKET


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?


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?


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: “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”


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


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


• 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)


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


• 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


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?


• 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


• 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


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)

MARKETING, FASHION MARKETING AND LUXURY MARKETING · Marketing segmentation and target definition •Marketing is the way of thinking of the entire company, marketing should involve

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