Management of Fashion Companies Final

mass market goes prestige: communication

Masstige brands compete primarily through communication: -elevating product status with the signature of designers and celebrities choosing top models for testimonials in ad campaigns -creating (artificially) limited editions -occupying high-traffic locations -investing in huge retail space as a sign of visibility

merchandising

Merchandising defines the offer structure -Structure and complexity/number of SKUs -Offer segmentation and balance (fashion content) -Price positioning -Key items for the brand identity (icons)

collection planning: merchandising plan and timing

Merchandising plan: -Structure of seasonal collections Timing (planning) -Activities, deadlines, specific responsibilities -Evaluation of the coherence between workload and available resources

new generations impact on market growth (altagamma)

New generations will deliver ~130% of the market growth...with gen z showing the original traits vs. gen y, to be properly addressed

building the collection

Selection of protos: -Tests on materials -Tests on colors -Tests on fit in house testing: -possible new developments to insert new propsoals (commercial requests) final structure of the collection -stops/freeze/editing size and number of sample collections (sales network, clients, etc.) -sample collection release timing -impact on sample collection department (workload peaks)

e-tailers

Sell products by mail delivery -Order through phone or website -Bricks and clicks - physical retailers that integrate internet into their business as a marketing tool or channel to market -Pureplays - clicks only --In the last decade, some players among the clicks-only e-tailers decided to focus on the clothing category: main examples are yoox/net-a-porter and ASOS -can ship to third party consumer (good for gifts)

ecommemrce

Specialized: ASOS Non specialized: amazon If you dont control of positioning online you could risk brand image and brand equity - need to be careful if you just use indirect channels online

experiential shopping drives direct-to-consummer distribution

Stores are gradually evolving from mere transactional spaces to entertainment destinations. The store-based shopping experience is not being replaced - it is being gradually complemented (and enhanced) by digital operations offering 24/7 purchase potential

stylistic identity

(stylistic codes - the DNA of a brand): elements that enable the recognition of a designer that interprets a style or invents a new one (lines and shapes, symbols, colours, accessories, fabrics, details...; iconic product/elements or brand identifiers)

chanel fragrance

-"I don't want a smell of roses or lilies of the valley. I want a composed perfume. It's a paradox. Natural flower fragrances smell artificial on a woman. Perhaps a natural smelling perfume has to be artificially created " -No 5 was created in 1921 - ranked #1 selling perfume worldwide (5% of share) with estimated retail sales of $100 million annually (about 5 mil bottles in 2011)

inditex group

-"The inditex model is built around the customer. Each of the elements comprising the company's value chain, from designing collections to its logistrics capacity, make sense only on this basis" (Inditex AR) -Zara, zara home, pull and bear, berske, massimo dutti, oysho, uterque -20% EBITDA - not bad -Inditex's concept of production is geographic proximity - this represents 55% of total production and implies that fashionable products are manufactured in the groups own factories or by suppliers whose processes are significantly integrated with the group -Crucial to this is the role of European logistic platforms, specialised per brand/product category. Many different warehouses in Spain -Sales increasing by year, getting more global, markets, employees and stores increasing

armani prive

-150 outfits and some dresses and bridal dresses (2008) -prices: 25-40000 (daily time) 60-120000 (evening) 2-17000 (bags) 4-9000 (shoes)

luxottica key figures

-150,000 doors around world own/commercialize 40 major brands -Sell in 150 countries -More than 80,000 employees -9000 retail stores -10mn onesight patients -87 mn prescription frames and sunglasses -13 manufacturing plants -4 main logistics hubs In italy - luxotica has big brand name and is known first roughly 9bn in rev generated around the world fully vertically integrated model (from designing sunglasses/frames to selling to consummers)

lvmh financials

-70 brands -Revenues: 2017 42.6 bn (13% in europe) -4374 stores -145,247 employees -Profit from recurring operations: 8.3 bn euro -70 countries -Fashion and LG: 15472 ml euro

michael kors

-Backpacks from michael kors -Michael kors results: growth declined -Now in a group with versace and jimmy choo -Stopping production of their michael kors stuff -Growth increased at declining rate since 2013, declined in 2016 Revenue declined fro 2016-2017 Accessories are ~70% of sales

UGG - special story

-Boots invented by an australian surfer, Shane Stedman to keep his feet warm after surfing -Registered the name UGH-boots in 1971 in Australia and started selling boots -In 1982, he registered the name UGH and one logo with a sun with the name "UGH AUSTRALIA" -In the meanwhile, in 1978, another Australian surfer, Brian Smith, came to the US with some boots bought from Stedman's store. He created the brand UGG Australia and started selling those boots in California, and in the 80s the brand became popular and trendy -In 1987, Brian Smith founded UGG holdings Inc. and in 1995 bought the brand from Steadman -In 1996, the American Deckers Outdoor Corp. bought the company founded by Smith for $15 M -In 1999, UGG Australia was registered in the US and 25 other countries

chanels history

-Born in Saaumur, abandoned at 12 to an orphanage -Went to paris at 20, became cafe single, then opened first atelier creating hats (with support of Etienne Balsan who introduced her to her love Boy Capel) -Opened first boutique in 1920-paris (rue cambon) then in deauville and biarritz (using jersey - a new fabric) -In 1921 coco chanel launched perfume no 5 -1924-founded perfume chanel company in agreement with the wertheimers family who currently controls company -Opened a bijoux lab in 1924 -1926-created little black dress -In 30s, had about 4,000 employees and sold 28,000 pieces per year -During the war, only accessories were sold but then in 1954, maison chanel opened again - the matelasse sac was in the final version and the tailleur was created -1957-received from neiman marcus the oscar de la mode -Died in '71 -In '83 hired Karl Lagerfeld as creative director -'89 horlogerie chanel is created and 93 chanel joaillerie opens in place vendome 18

Key strategic features of fashion/luxury companies/groups

-Brand and business portfolio -ownership/governance -growth

licensor points to be evaluated

-Brand awareness -Brand protection -Creativity and know-how -Company strategy (core vs. non core, business plan, etc.) -Marketing investments -boutiques/distribution network -Organization structure

brand management in fashion is about

-Brand identity definition and brand equity improvement -Customer and competitive intelligence -Collection structure management -Business performance evaluation -Line development/licensing

factory outlets

-Collections unsuitable for traditional shops -Located in suburban but very busy areas often surrounded by other outlets -Factory Outlet Centers - one stop shopping formula -Discount 30-70% -Presence of entertainment activities (theaters, food)

concept is defined through:

-Company mission -Pictures -Fashion studies -Colors tendencies -New materials -Trade and retail suggestions -Others

ethical fashion - ethics and fair trade

-Compliance with the agreements of the ILO; - Social work with ethnic minorities from disadvantaged or underdeveloped areas; - Traditional methods of production of particular areas or countries; •Compliance with the Fair Trade criteria: creating opportunities for economically disadvantaged producers, transparency and accountability, capacity building, promoting Fair Trade, payment of a fair price, gender equity, working conditions, child labor, the environment, trade relations.

Key strategic features of fashion/luxury brands

-Core businesses and core segments -Degree of vertical integration and core competencies -Distribution -Business logic -Internationalization -Design

gruppo finaziario tessile (GFT)

-Created in Turin in 1930 with merger between Rivetti and Levi& Figli which was a pioneer of industrial apparel in 19th century In the 50s, GFT becomes a leader in the mass production of men clothing, both as a facionista and with his on independent brand (Facis) -GFT launched a new system of sizes, based on an original anthropometric study of the italian population

degree of vertical integration and core competencies

-Design → manufacturing → distribution -Brand management

christian dior history

-Dior became the king of Haute Couture in the '50s with financial backings from cotton magnate Marcel Boussac (in 1949 he was responsible for 75% of all french fashion exports). Dior was the first to: introduce a new trend every 6 months, transform the catwalk into a fashion show, understand the potential of licensing ("we're selling ideas") -1984: financiere Agache S.A., driven by Bernard Arnault, acquired the textile group Boussac Saint-Freres (who owned Dior) close to bankruptcy) -1989: Christian Dior S.A. Holding became a major stakeholder of LVMH 0 Arnault was president and chairman of greatest luxury-products group in the world -1996: John Galliano was appointed head designer of women haute couture and ready to wear collections. VIctoire de Castellane designs the jewelry line. Kris van assche is the manswear art director (replacing Hedi Slimane) -On march 1, 2011, CD fired galliano due to anti-semitic comments. Raf Simons appointed new creative director in may 2012 and in 2016 maria grazia chiuri was hired from valentino -sept 2016 - debut of maria grazia chiuri

dolce and gabbana key facts

-Domenico Dolce was born in Polizzi Generosa (Palermo), Stefano Gabbana in Milano. In 1985 they made the debut of the D&G brand with their first show at Milano Collezioni -In 2011 consolidated revenues achieved by D&G reached 1,120 MM euro with EBIT 181,6 MM euro. The group had a retail netowork of 251 mono brand stores (187 in 2012) -The group designs, produces and distribution high-end clothing, leather goods, footwear and accessories. Through licensee partners, it also manages the production and distribution of the beauty, eyewear and time lines

country models

-Each country has its own history, culture, and values -This heritage is reflected also in fashion, in countries that had an important role in the development of clothing, leather goods, and shoe sectors -To learn about country branding, you need to understand the history of the industry and the most important business models in that specific country

concept store: armani in milan

-Experiences not just concepts -Focus on a lifestyle theme -Different product categories/price ranges/labels/encourage cross selling and browsing -Impulse buying is favored by the creation of an emotional appeal

womanswear vs menswear business

-Fashionability, number of product categories and product lifecycle are different -In menswear higher level of vertical integration (product standardization) -Shopping drivers: emotional vs rational (importance of service) -Top of the pyramid: bespoke for menswear and designer brands for womenswear

trends in product design

-Focus on the number of collections/deliveries per season and shows (men-women shows, show now buy now), capsules-collaborations -Control the number of SKUs (reduce complexity) -Focus on iconic products (permanent) -Development of outlets: this is a real business! -Reduce the n. Of samples -Collections are built taking into consideration retail needs -Customization: bespoke / made to measure -Cut off the number of lines (Armani, Burberry, Paul Smith)

kinds of video-catalogues

-Frames taken fro fashion shows -Videos from advertising campaigns -Short-movies where actors ("product placement") -Videos in which the fan is involved in the virtual worlds (ie gucci and LV live fashion shows, Lacoste "virtual party") --> engage through tecnology

linen benefits

-Hypoallergenic and antibacterial -Recommended for sensitive skin -Thermoregulator -Insulating in winter, fresh in summer -Anti-stress -Absorbent -Linen enhances the quality of sleep and ensures well being -Linen can contain up to 20% of its weight in water without feeling wet 100% eco responsible 100% sustainable development 100% natural

GFT in the second cycle

-In the 70s, they got licenses to produce ready-to-wear (both mens and womenswear) for the rising Italian designers. Armani and Valentino were the most important contracts -Further growth in the 80s, the new license agreements with Pierre Cardin and Calvin Klein -In the 90s, a crisis began, due to excessive debt levels used to finance expansion and the entry of competitors. In 1994, the Rivetti family retired. Armani terminated the license. In 1997, the company was sold to HDP, an Italian financial conglomerate. The other licenses were lost -In 2002, Valentino (which was previously owned by HDP) was sold to Marzotto and GFT remained with no major license -In 2003, GFT definitively closed and the factories were bought by Armani and Zenga

furla: product strategy

-Joyful and contemporary italian lifestyle -Premium italian brand -Revenues in 2014 around 262 m euro, present in 100 markets, 398 monobrand stores and 1100 doors (department and multi brand stores) -1185 employees from ~100 different nationalities -Leather gods are the core business (bags, small lg, shoes) but they sell accessories, umbrellas, jewellery, watches and eyewear, through licenses with excellent italian partners. The first men collection launched June 2015, at Pitti

design: industry company

-Licensees -Art directorship -Internal design team -Free lancers -Mix of previous solutions

minimizing fashion risk: manufacturing (sourcing)

Flexible sourcing that allows the company to put new models in the store in 10 days (2 weeks) Small production batches for each reference: be fast Directly managed factories and partners (1805 suppliers in 2016 AR) Sourcing: -55% Spain, Portugal, Africa (geographical proximity) -45% Europe, Asia, ROW Everything is designed within Inditex: many pattern makers, suppliers provide manufacturing (they are provided with fabrics and technical info) or finished goods In general one product comes from one supplier Logistics costs are very high: 5-10%

recommendations for socially responsible purchasing

Ask more questions about environmental and social impacts of the clothes you want to buy when shopping ---Educate yourself Demand more transparency (#whomademyclothes) Ask your elected officials to do more Talk to friends and family about the social and environmental impacts of their clothes → build a community

fashion content

Basic, running, carryovers (>1 season) = "basici" "continuativi" seasonal , fashion (1 season) = "stagionali" Limited series and capsule NOOS = never out of stock, its not a matter of fashion content, its the point of its continuous delivery

h and m values

Believe in people Entrepreneurial spirit Constant improvement Cost conscious Straightforward and open minded Keep it simple Diversity and equality

brand equity

Brand equity in terms of financial value Brand equity as the potential for brand extension Brand equity from the customer perspective → Brand awareness and image

do diffusion lines still mmake sense

Brand extension (different price segments) used to mean: -Increase in revenues -Increased awareness -Attract younger customers Today there is strong competition from: -Accessible luxury brands (kors, tory burch...) -New brands: 3.1 philip lim, alexander wang -Designers collaborating with mass retailers -Luxury brands broadening their offers (LV coin purses) In general, second lines with shorter names indicates a lesser idea (Ralph Lauren → RL, Donna Karen → DKNY) Brand extension with second lines also means a very heavy cost structure (different ad campaigns, selling campaigns, design teams, shows and also sometimes different stores and dedicated offices and suppliers...)

3. produce content that involves the fan/follower

Burberry "ask cristopher" -Burberry posted a video on FB showing their head designer Christopher Bailey who asked fans to post questions. He answered questions 5 days later by another video (5 min) -Almost 3000 people reacted to the 2 posts by commenting, asking questions, and liking the post Gucci e-connect Gucci invited fans to sign up for a unique virtual fashion show via Facebook. Facebook fans thus increased fro 1 mil (9/2) to 1.5 mil (9/29) LV - women's FW live fashion show 2011/2012 -LV organizes the first live fashion show -Besides the fashion catwalk there was also other sections "behind the scenes" and a video commented by the fashion designer Marc Jacobs -The virtual experience is even better than the real one

2. involve the audience in the implementation

Burberry "the art of trench: Burberry asks customers to upload photos of the wearing a trenchcoat - photos can be liked, commented, and shared

CSR associations

Business Social Compliance Initiative (BSCI), Ethical Trading Initiative (ETI), Sustainable Apparel Coalition...

minimizing the fashion risk: customer and the offer

Catch the information at the stores, design and supply what the customers want through: -Daily (per hour) sales analysis -Customer feedback: requests to the sales force are discussed daily with the store manager; paying attention to what is tried on in the dressing rooms and what is left -On-line purchases available in store -For zara 15,000 different items in one season

core business

Clothing, Shoes, Leather Goods, Jewellery, ... It depends on the original business when the company started and on the present situation

product development (PD) activities

Collection guidelines/inputs for merchandising plan (MP) -Analysis of previous collections, market analysis -Briefing for each line/collection Collection planning: -Timing (scheduling of activities) -Merchandising plan Collection development -Styling and model design (research), prototyping -In house testing and sample definition and production -Industrialization: preparing for manufacturing Collection presentation

the development of made in italy

Competitive advantage of italy compared to other countries (ie France and Germany) has been the simultaneous presence of the following 3 conditions -Designers -Entrepreneurs -Textile industry Four cycles to describe the evolution of the industry: the 50s-60s, the 70s, the 80s and the 90s

minimizing fashion risk: orders and deliveries

Constant changes to the initial collection (the one launched at the beginning of the season) Re-orders from store managers on the basis of sales data New items deliveries are decided by HQ Merchandise ordered twice a week by stores, merchandise delivered twice a week in stores (on thursday and sunday); visual merchandising continuously changes When a store sends an order, the commercial team at HQ processes the order within 2 hours, in 8 hours the merchandise leaves the distribution center; transportation guaranteed (36 hours delivery in Europe and 48 hours delivery elsewhere. In Italy with trucks)

the italian fashion model characteristics and values

Creativity and craftsmanship (social values) → detail and innovation (product) → beauty and sensuality (image) → a lifestyle

paradox in managing style

DISTINCTION → style is the DNA of a company. It generates distinctiveness and has to be coherent over time BELONGINGNESS → style is the lens through which seasonal trends are read and interpreted by a specific community Distinction vs homologation - have to follow the trend because people buy the trend

analyzing consumer behavior

Demographics -Gender -Age range -Generation vs Psychographics -Product adoption lifestyle -Fashion profiles

variety stores

Department stores where they offer mostly private label Retail format that offers a wide range of product categories. Convenience is the common characteristic among the different product families. To give value for money they mostly offer private labels -The cosmetics department is less developed than the department stores: it is usually represented by mass market brands. Main product categories usually are: clothing, underwear, socks, childrenwear, home textile -Frequently these stores are located in high streets or covered shopping centers -Boots, Monoprix, Upim

technical drawings and prototype cards

Design sketches are generated from stylist/designer and transformed into: -Drawing for design and development process -Technical info for prototyping phase -materials to be used (new and old, well known, ones) -Critical elements to be tested for decision -Others Owner - tech office, product manager Output - sketches of new products, technical designs of products, selection of materials for prototypes

different approaches to fashion retailers

Design → manuf. → distrib. → retail H&M and the Gap do not own factories but have buying offices next to the main suppliers Benetton subcontracts labour-intensive activities but has invested heavily in controlling other production activities. On the other hand, most stores are franchised Mango does not own the stock at the stores (the same as benetton) but does allow merchandise returns

Differently profitable brands .. digital disruption (altagamma)

Digital disruption changing profile and nature of opex and capex... nimble approach to sustain margins

digital penetration influence on store experience/footprint consolidation (altagamma)

Digital penetration will lead to physical disruption: network consolidation. Stores will inevitably change: from point of sales to point of touch

multibrand brand portfolio

Directly owned brands (founded or bought) or licensed (e.g. Luxottica owns the Ray Ban brand and has licensing agreements with armani, chanel, burberry, stella mccartney, etc)

distribution strategy

Distribution is the first "mirror" for any product to be seen, chosen and bought Special attention needs to be given to the way distribution is made and how the company image is shown at retail There are many ways to distribute and each of them has special details and needs to be monitored and often changed/updated to follow trends, innovations and consumer's expectation The point of sales becomes a strategic marketing tool contributing to the creation of the total brand experience thanks to innovative solutions in terms of visual merchandising and planning

patagonia - sustainable fashion

ENVIRONMENT Pioneer of responsibility toward the environment Buy less buy better for environment -High quality - opposite as fast fashion Doesnt like to define itself as a fashion company Free repairs Reinvesting 1% of their sales on local products in cities where they have stores Black friday: close store one year, reinvest 100% of sales another

segmenting the fashion industry - fashion sectors

Each sector is divided into key sub-sectors that include different product categories, groups of clients, end uses Clothing (manufacturing) -Jeanswear -Shirts -Outerwear Underwear and hosiery -Ie children segment Knitwear Textile (yarns, fabrics) Finishing Home collection (others) Footwear Handbgs (LG)

collection guidelines: analysis of previous collections

Economic figures: sell-in/sell-out, sales per model, ABC analysis Industrial and commercial aspects (deliveries, production problems, assortment, suppliers). Data and qualitative info

advantages of related diversification (brand extension) Ammerican fashion

Economies of scope Revenue enhancement Increased market power

CELC

European confederation of linen and hemp Founded in 1951, CELC is the only agro-industrial organization federating all of the stages of production and transformation for linen and hemp 14 countries members, 10,000 associated industries 2 goals: innovation and sustainable development Covers whole textile pipeline european flax guarantee of linen 100%made in europe fromm plant to yard fabric - trademarked Well rounded promotion discussing textile innovations (books, textile creations), communication and events (fairs, newsletters, blog, promotional events) 80% of world flax fiber production is in europe

deeper luxury vs masstige

Excellent quality, no compromises -Vs mass market brands standardised quality Tradition and heritage -Vs mass market brands "throw away" products Distribution exclusivity =Vs mass market brands availability and accessibility Made to measure service

luxury

Exclusive product Very high quality (hand crafted content) Selective distribution Very high prices Famous international brands Heritage Timeless and intrinsic values

fahion and luxury companies: 2 different approaches

F&L companies/groups operate in different sectors, segments, they are mono vs. multibrand, have different distribution channels, operate in different markets and manage different supply chains... --> company/group perspective --> brand perspective

risks of horizontal brand extensions

Failure in technical extensions (such as armani golf and skiwear) Absence of technical capabilities Distribution not enough specialized for selling technical items

fashion definition

Fashion is a form of speech. It not only embraces clothing, but also accessories, jewelry, hairstyles, beauty and body art. What we wear and how and when we wear it, provides others with a key to subtly read the surface of a social situation

Facis

GFT 1956 -Sizes related to body height, chest, and waist -3 heights: 168-176-184 -Different combinations between chest and waist: the difference between chest and waist is called DROP. e.g. chest 50 and waist 42=drop 8 -5 bodies with different sizes (slim - 7, normal-9, medium robust-9, robust-7, pot-bellied-8) x 3 heights = 120 sizes

demographics

Gender -Men/women/children Age range (actual vs. mental) -Adult/young (RTW Collection) -Baby/kid/junior (childswear) Generation -Digital natives: --Pre teens or gen z (0-20) - group identity --teens or net generation Y (21-35) - mobile lifestyle --Generation flex X (36-55) - value oriented -Baby boomers (56-70) - well being, health, career -New seniors (70+) - specific needs

LOHAS

Lifestyle of Health and Sustainability Consumers, a consumer type but also a market of goods and services that puts them at the center of health, the environment and sustainability LOHAS lifestyle can be called Hybrid - being LOHAS means supporting technological evolution, enjoying nature, living a life centered on their individuality, however, thinking of sharing with each other. The LOHAS are realistic but open to spiritual ideals

quid collaborations

calzedonia, vivier westwood (headbands with leftover silk) - very sustainable company, naturasi accessories related to kitchen-wear

luxury: sectors, brands, products

cars, boats, high end clothing/accessories/bags/leather goods, watches, precious items such as pens lighters and key rings (high end segment in mmany sectors) LV and prada, armani prive, chanel, dior, hermes, tiffany tiffany bracelet

armani branded re

casa- Istanbul, mubai, rome, milan, miami, manila Waikiki, tel aviv, beijing, ny, chendu art residence hotels - milan, dubai

starbucks store experience

casual atmosphere, interactivity, wifi

specialized shops

chains (h and m, benneton, zara, prenatal, tezenis, decathalon) and independent and multibrand shops

chanel: the bag

chanel matalasse is one of the most fammous luxury iconic products

product strategy (positioning) and stylistic identity dressing styles

classic, updated, contemporary, avant-garde

Fashion: sectors, brands, products

clothing, accessories, shoes, leather goods, bags, make up h and m, zara, diesel, emporio armani products: sandals

image brand identity

communication strategy (seasonal)

moschino positioning

company decided to change positioning of the brand and switch directions cheap and chic has been most important line for moschino (love moschino)

collection guidelines: market analysis

competitors, trade, final clients

revenue enhancement

complementaries in revenue streams (e.g. customers that are loyal to clothing will buy bags and shoes with the same brand)

advantage of related diversification: revenue enhancement

complementaries in the revenue streams (e.g. customers that are loyal to clothing will buy bags and shoes with the same brand)

shifting distribution landscape

consumer preferences for particular retail channels are shifting worldwide Digital commerce is accounting for an increasing proportion of global retail value sales. 12% of total apparel and footwear retail value sales took place over the internet in 2015 at world level, and internet retailing was the fastest growing distribution channel over the review period

consumer attitudes toward environment/social impact

consumer survey report data (5000 people, 16-75, 5 countries) ~38% cqre about social impact ~37% care about environmental impact percentages in italy are higher than other european nations

raw materials: natural (vegetable)

cotton, linen, hemp, jute main ingredient in all vegetable fibers is cellulose, a carbohydrate found in all plant life both cotton and linen are vegetable fibers linen is made from the flax plant, cotton is made from the cotton plant

designer brands

creativity HC, PAP, diffusion and upper bridge Clothing and fashion shows

CULTURES AND (SUB)CULTURES... TAKING OVER CONSUMPTION TRENDS(altagamma)

cultures/sub-cultures and new consumption patterns that will arise ... Categories will blend: brands must be dynamic and responsive to adapt

department stores - nordstom best practices

customer service, CRM building relationship with customers

product strategy (positioning) and stylistic identity life occasions

daily, work, leisure, special occasion

underwear and homewear occassion of use

day/night

1. build up a social media plan

define objectives --> allocate resources --> measure the return --> correct action

non specialist shops

department stores (rinacente, coin, el corte inges, printemps), ipermamrket (auchan, carrefore), mail order (la redoute, otto versand)

multibrand group: corporate synergies

derive from corporate capabilities, corporate initiatives and corporate planning and development: expertise in distribution, licensing, market intelligence, luxury branding and management of talent

multibrand group: operational synergies

derive from pooling common resources, related to production (R&D in fragrances, purchasing in leather, manufacturing in watches), to support activities (logistics, warehousing, HR, IT, media buying, real estate) and to the transfer of know-how in those functions

who creates trends

designers, consumers (in a way consumers decide what is cool and what is not) media (movies, social media and influencers, magazines) celebrities

7. create online shopping experience

diesel - Interactive video where all the outfits could be examined closer and purchased in the linked e-shop

risks of vertical brand extensions

dilution

diff formats in ecommerce

direct(most control over experience): virtual flagship stores indirect: -etailer multibrand - full price (specialized - asos, net a porter) (non specialized - amazon, alibaba) -etailer multibrand - discounted price - yoox.com -online clubs (private sales) city deals (groupon) - least control over positioning

distribution

direct/retail - DOS (directly operated stores: flagship, self standing and shop in shop*), and internet -direct to final consumer indirect/wholesale - multibrand, Department stores, corner, wall unit, open sale, franchisees

distribution

direct/retail: DOS (directly operated stores: flagship, self standing and shop in shop*), internet... indirect/wholesale (multibrand, DS: corner, what unit, open sale*, franchising...)

multibrand stores best practices/examples

dover street market 10 corso como lifestyle, iconic codes, capsule collections, art

advantages of related diversification (brand extension)

economies of scope revenue enhancement increased market power

lauderee store experience

elegance, sensory

aesthetic innovation: style and style codes Stylistic identity (stylistic codes-the DNA of a brand):

elements that enable the recognition of a designer that interprets a style or invents a new one (lines and shapes, symbols, colours, accessories, fabrics, details...; iconic product/elements or brand identifiers)

product strategy (positioning) and stylistic identity stylistic identity (style codes)

elements that enable the recognition of a designer that interprets a style or invents a new style: colors, fabrics/materials, lines/shapes (cut/length), graphics iconic elements and core products

product strategy (positioning) and stylistic identity target market

end consumer and trade channels global vs local

social networks (and 6 needs)

entertainment transaction relationship interest internalization recognition network of people with common interests communicating with each other electronically Among the 40 most globally visited sites, 8 are social networks - youtube, insta, linkedin

sustainable fashion

ethical fashion + eco fashion

segmenting the fashion system: end use

external (formal, casual, active), underwear, beachwear

types of fashion

fashion and luxury change is more frequent in fashion than luxury brand is more important for "fashion" armani has both luxury and fashion brands

italy's 3 Fs

fashion furniture food

wrad

fashion revolution -in response to building collapse in bangladesh collaborations - brands communicate their own value through wrad (focus designers dedicated to challenging the status quo through sustainable innovation and social change) non toxic and garbon based graphite power graphic tees

digital investments of companies

fashion sales will continue to grow driven by: 1. online sales 2. cross-channel sales and web driven sales volumes 3. willingess to satisfy a smart consumer --> ominchannel management

H and m x balmain

fashion show with kendall, gigi, karlie kloss and more

vertical retailers

fashionability and price Flow delivery of new fashionable merchandise in large and welcoming stores at very convenient prices h&m, beneton, zara, uniqlo, gap, promod

product and process innovations

fibers and fabrics: goretex -thermal comfort, smooth, comfort fit processess: CAD/CAM systems, cutting systems, fast fashion computerized cut

stylistic brand identity

firms history and commpetences socio-cultural context product strategy (seasonal)

the surge of made in italy

first cycle: the development of industrial production From the 50s to mid 60s (sala bianca, Florence 1951) Industry -Apparel technology from the US -Sizing issue (GFT) -Haute couture is french but some italian maison (fashion houses) emerged -Roberto Capucci: born in 1930 -Sorelle fontana: Zoe (1911-1978), Micol (born in 1913), Giovanna (1915-2004)

retail formats

flagship store, self standing store, shop in shop, corner, wall unit directsale --> more direct location+image: -metropolitan city center -city commercial centers -city department store -city mutlibrand store or department store -travel related

d and g business model evolution: the former d and g second line

folded its secondary line into the main label to limmit canibalization between the two lines as of 2009, wholesale revenues by d and g were 710.3 million euro (45% of groups total sales)

versace licenses

fragrances, eyewear, jewelry, watches, home - since 1992 - (plus rosenthal - co branding - wallpaper and ceramics, and RE) All licenses are for the versace line

paul poiret

french (1879-1944), the first designer, launched a new silhouette (no more corset), used real models to show his creations, designed many products, internationalized but died poor due to financial bankrupcy

fashion derivation

french facon (manufacturing following a sample)

evolution of designer brands

from small maison to: -Integrated groups (armani, d&g) -Maison that relies of licensing (cavalli) -Maison acquired by a financial or industrial company (ferre, moschino, valentino)

beyond functional benefits

functional benefits: when I buy/use this I get emotional self-directed benefits: when I buy or use this I feel emotional hetero-directed benefits: when I use/buy this I am social benefits: when I buy/use this, the type of people I relate to are

design: sectors, brands, products

furnishing boffi, ikea, mmolteni, armani home, zara home lamp

showrooming and webrooming

future of the physical store - physical store will not disappear! Evaluate in physical space and buy online Evaluate online and buy in store

gen x and gen y

gen x- 35-55, at top of career, men and women gen y-20-30, first earning money/2nd generations, only children value: sense of belonging customer relationship multichannel

social cultural trends

generless streetwear/athlesure/sneakerization seasonal trends (faux fur, fanny pack)

macro seasonal trend - refreshing waterworld examples

giorgio armani versace

global online luxury market

global online luxury market has risen to 8% market share

collection guidelines: company objectives

growth, profitability, number of SKUs, new product categories

kering brands

gucci saint laurent bottega veneta balaneciaga alexander mcqueen stella mcarthey

number of fashion shows and trade fairs

has risen since 1990s a lot more fashion shows in all contiments (asia has risen the most) -now ~21 in asia, 18 in us, 16 in europe trade fairs: now 140+ in europe, 130ish in asia, and 70ish in america (used to be under 20 in all)

dressing styles: classic/traditional

hermes and louis vuitton -attention to price/quality ratio and durability -lack of interest for fashion (timeless style) -attention to details (sartorial)

paid media

high control, low credibility, economies of scale search engine marketing, ads and banners on fb --> bring traffic to owned media

core segment

high end, accessible, mass. They impact revenues and positioning - Clothing high end: Armani, Valentino, Versace, ... - Shoes-Leather goods high end: Ferragamo, Gucci, Prada, Tod's, ... - Luxury jewellery: Bulgari, Cartier, Tiffany,...

accessible luxury

high fashion content, price/quality, accessibility (target, media, channels), power communication hogan

LICENSEE branded re advantages

higher margins higher sales exploit econommies of scale/scope/know how

Karl lagerfeld

hired as chanel creative director in 1983 "Maybe what I've done would have killed her, but without me, she would have been dead"

dolce and gabana - identity in communication (codes)

hollywood stars, provocative campaigns

manebi

homemade espadrilles made in spain 250 wholesale clients in 30 countries Brand inspired by the easy and chic lifestyle of provence - conceived in st tropez - comfortable, tasteful, and worn everyday

versace branded re

hotels-"Palazzo Versace" - Gold Coast Australia, Dubai, Macau China home -Apartment buildings in London, Saudi Arabia, Beirut, India, China, Phillipines

future of shopping

importance of mobile, AI, machine learning (yoox net a porter) immportance of online-offline integration and retailtainment (alibaba) importance of AI and machine learning

chanel's raw materials

in 2013 chanel bought bodin-joyeuax, the french tanner who has been supplying Chanel with lamb skins for its icon bags (prices around 1,500 euro) for 30 years Chanel owns a flower cultivation farm near Grasse, the French perfume capital. The flowers (mainly roses and jasmines) are employed for the Chanel No. 5 fragrance In 2002, Chanel bought Lesage, a well-known embroiderer, for its haute couture collections

furla: LG product strategy

Lines share a certain stylistic approach Collections are unique for all markets, but specific needs of different markets are considered (especially as regards to the sizes and colors of the bags) SKUs (model, material, color): 900 per collection Also ⅘ capsules per year, mini collections made up of bags and accessories for specific occasions (mothers day, v-day) Price ranges functions(type of bag), occasion of use(elegant, sporty, ceremony, day), → main variables for merchandising

industrial manufacturing: product costing

Make or buy choices in productive allocation -Choice of specialized suppliers -Audit on small series Product costing -direct/indirect costs -Contribution margins -Pricing and price list

manufacturing companies

Many companies that differ in size, degree of vertical integration, internalization, brands, product categories, price → brands and companies

h and m figures

Markets: 69 in 2017, 43 online, 4739 stores 232 bn swedish kronor in sales in 2017 96% renewable electricity in H&M group's own operations in 2017, 59% organic and recycled cotton in 2017 - aiming for 100% by 2020

D and G business model evolution - value chain

in 90s expansion through licensing agreements at the end of the 90s, D and G decided to turn itself from a fashion company into a veritically integrated company -chief production company d and g controls mmanufacturing -DGS S.p.A. controls the italian own store network. 2 subsidiaries in new york and tokyo control international marketing licensees with p&g for fragrance and luxottica for eyewear

style/design

in apparel unique shape (silhouette) defined with a peculiar cut, length, pattern (model) and so on (military, minimalist)

aesthetic innovation: style and style codes style/design

in apparel unique shape (silhouette) defined with a peculiar cut, length, pattern (model), and so on (military, minimalist...)

segmenting luxury

in recent years, luxury leaders have segmented their offer according to exclusive, selective and accessible cateogires (trading down), with an eye to maximizing growth opportunities absolute luxury, luxury, accessible luxury

distribution strategy: wholesale channel

including franchising: corner, wall unit, open sale e-tailing, full-price, off-price

from distribution to retail management

increasing control over distribution: most fashion brands in the last 20 years have become retailers managing the brand identity on a multi-channel distribution creating global retail policies

drivers of branded re price premium

innovation higher capital value (development quality and brand awareness) design and identity trust (customer confidence)

how to innovate to create shared value

integrate ethics, innovation and aesthetics in value chain

multi channel -> omni channel

integration among the channels

macro-seasonal trend: femininity

its all about the courage to leave behind aggressive femininity - instead we temper it with sweet seductiveness to express our well being and self- esteem d+g valentino

giorgio armani stylistic identity (codes)

jaccket, grey, soft, de-constructed lines, masculinity

8. grant online-offline integration

jimmy choo catch a choo To introduce new trainers jimmy choo engaged fans in a hunt across london to win the shoes via twitter, fb and foursquare. Trainer sales increased as a direct result of the campaign

seasonal fashion timing - SS 2019

jun 17 - yarn suggestions oct 17 - yarn fairs feb 18 - textile fails jun/jul/sept 18 - fashion show b 19: collections in store revolution - burberry align runway and retail calendar

shop in shop

la rinaciente -stores within an external commercial structure (usually a mall) -3-4 walls plus floor -entrance through a door (separate area) -specialized sales associates -LV and specialized shops within a store

Moda derivation

latin = mos, modus (habit)

segmenting the fashion system: technology - materials and activities

leather, man made, wool, cotton, silk; spinning, weaving, dying...

licensing agreement - main points to be evaluated

licensee licensor

armani store experience

lifestyle, concept store

fashion collections: seasonal offer

line --> collection: an assortment of items - a product range (one or more than one product category) with the same label seasonal collections key factors -size -structure -level of innovation

luxury sneakers article

luxury brands offering creative and exclusive shoes Expensive Trend of "sneakerization" Non luxury brands not worried Larger market - now everyone wants to wear sneakers all day Streetwear is a trend Can boost prices because now have luxury prices

sources of stylistic creativity

macro trend - dominant styles macro trend - established colors, fabrics, accessories details (lace, studs..) stylistic identity and iconic products concepts and issues from market researches personal and company sources: archives, artists, events, travels macro trend: emerging colors, fabrics, accessories, details --> designer creativity

tiffany and co

makes you think of luxury breakfast at tiffany's diamonds high end turquoise also has lower end products that are not luxury - brass necklaces, not exclusive, lower quality - still high price but cost is much lower to mmake

dressing styles: avantguarde

mcqueen - JPG -extreme expression of fashion -anticipated use of innovative models and materials -eccentricity and transgression -research and experimentation

bulgari hotels

milan, london, shanghai, bali, dubai, beijing

dominant styles

minimal, masculine, kitsch

Aesthetic and symbolic innovations

miniskirt = new style, new meaning

abercrombie and fitch store experience

music, characterized, models

victorias secret store experience

music, glamour, sexyness, pink, fashion show

physical attributes of a brand

name symbol jingle slogan lettering

aesthetic innovation: style and style codes seasonal codes

new and fashion elements to refresh and innovate the product (they are related to macro-trends; mainly concerted at the pipeline level)

seasonal codes

new and fashion elements to refresh and innovate the product (they are related to macro-trends; mainly concerted at the pipeline level)

luxury brands

prestige and exclusivity -Value proposition: timelessness, heritage, exclusivity revenues/competition on product categories other than clothing -Vertically integrated both in retail and manufacturing (cartier jewels,...) -One brand (chanel, hermes) -Iconic products -Designers? -Evolution: --Privately owned (chanel) --Listed on SE (hermes) --Multi-brand groups (LVMH, Kering)

branded residences

price premium (uplift of 31%) well known brand associated to strong design content -model of luxury, individuality, quality, identity, and exclusivity integrated hotel-like facilities (prestige, security, privacy)

segmenting the fashion system: key variables

price ranges, channels, customer, end use, technology -materials and activities -product category

company ownership

privately owned (families, designers) listed on stock exchange private equity funds mix of previous owners

omni channel pros and cons

pro -possibility to create a channel-less experience through all touch points con-channel conflict

pret a porter

ready to wear

valentino style and stylistic codes

red

multibrand group: financial synergies

relevant; corporate will provide financial resources, at a lower cost, there is money to invest.

value chain control requirement

requires to build new commpetencies very far fromm the company's original know how

ROPO

research online purchase offline

fendi branded re

residences in miami, ny, dubai

segmenting luxury- same brand same company, vs different brands same company

same, same: bulgari diff brands, same company: roger vivier vs tods vs hogan

in fashion, continuous change is produced by:

seasons, needs, performance (fabrics) companies need to induce people to buy new products

dolce and gabbana - stylistic identity (codes)

sensuality, femininity, black, curvy

lifestyle luxury

series production (limited editions), quality/style, heritage and brand identity, selectivity (target, media, channels) tod's

department stores

shop in shops + corner + wall unit + open sale Retail establishment that specializes in selling a wide range of products organized into departments -Main product categories: clothing, accessories, tragrances, cosmetics and home collections with no predominating merchandise line -Department stores mostly offer brands and they give those brands a dedicated space in terms of visual and merchandise (wall units, corners, shop-in-shops) -Gross internal area (GIA) ranges from 3,500m^2 to above 12,000m^2 (large town centre stores - small department stores/large department stores) -Selfridges, Rinascente, Gaaleries Lafayette, El Corte Ingles, Galeria Kaufhof

dolce and gabanna roots

sicilian aesthetic and metropolitan glamour -also like playing with roles, opposites (masculine and feminine, black and white, sacred and profane) communication -sicily, neo-realism, celebrities, masculine and feminine

progetto quid

social enterprise Beautiful ethical fashion collections making use of overstock fabric Through its innovative production cycle it creates inclusion opportunities through employment for women and men with social vulnerabilities values: unique (limited editions), ethical (made by people with socially vulnerable backgrounds), sustainable (overstock fabric from italian fashion companies), made in italy

social wearers

social wearers in luxury are growing -socially responsible, lives in bug citirs, cares about art and charity -luxury=quality and sustainability -feels emotional connection to purchases -checks where products are made 35-40yo, 60% womman, 3% of luxury market (.7M)

retail brand identity

socio cultural context firm's history and competences retail strategy (seasonal)

beachwear (occasion of use)

sporting practice, leisure (sporting spirit)

active wear (occasion of use, product categories)

sporting practice, leisure (sporting spirit) product categories - technical apparel, technical shoes, and accessories

h and m communication and limited edition

stella mcartney cavali-marni karl lagerfeld 2004 viktor and rolf

collection presentation

structure the collection for presentation/communication -exhibitions -showrooms -fashion shows -PR

characteristics of the offer: new store - from retail to experience management

structure: architecture, layout assortment: visual merchandising, category management services: informative services, retail-tainmment

types of brand identity

stylistic, image, retail

district

system of companies located in a specific area manufacturing the same product or components or carrying out preparing or finishing activities including local services, infrastructure, and institutions

burberry store experience

technology (flagship store in London)

third cycle of the survey of made in italy/italian style

the 80s 3 big groups of players -Big manufacturing companies: GFT, Marzotto, Miroglio -Medium industrial product oriented companies: Max Mara, Genny, Basile, Zegna, Aeffe, Ittierre (some of them were licencees) -Pure designers and designers/entrepreneurs: Mila Shon, Missoni, Versace, Valentino, Armani, Ferre, Moschino, Krizia

brand extension through licensing advantages for licensee

the company manufacturing and selling the products relies on well know brand, prices can be higher, revenues increase improves knowledge

key drivers of branded re

the market -increased demand for prime property after the 08 crisis -increase in EM wealth -shift in investments requirements from stock market to re the customer -new customer needs are emerging in prime re - high level hotel like services and facilities for wealthy but time poor individuals -identity, provenance and trust

disadvantages of multibrand group

• scarcity of manager's attention (too many projects) • bargaining power used to reduce costs and not to get better suppliers • risk of brand flattening • difficulties in finding the right way for each brand

segmentation

• the industry/the market (product categories, channels, price ranges,...) • the customer

internationalization

•Exports and international presence • Sourcing: raw materials, manufacturing, finished goods

positioning map

built on the basis of significant variables and includes brands with similar/different positioning. It should be built from field analyses and represent consumers perceptions.

menswear collection ss 2019 timeline

presentation: may (pre) , june (main) 2018 selling campaign: june (pre), july (main) 2018 delivery in store: end of dec 18 (pre), jan to march (main)

brand perspective - brand typology/business model

• Value proposition • Segments of clients • Distribution channels/Communication • Degree of vertical integration (donwstream)

Designer brands: key success factors in haute couture and pret a porter

• creativity/distinctiveness • quality (Made in Italy) • dream factor evolution: -from brand extension to lifestyle -second lines?

charles frederick worth

(1825-1895) founder of HC: he was the first to put his name on his creations and became the official tailor for the french court, innovating styles (a new collection each year) and beginning to sell his patterns to foreign customers

baby boomers

(55+, retired, mainly men): value: -exlusivity and status -scarcity -detatched selling ceremony -personal relationships -bricks and mortar

dressing styles: characterised

(D and G, Versace) -innovation and attention to trend -awareness of the communication potential associated to a dress -details evident, strong colours -constructed materials and dresses

dressing styles: modern

(armani - burberry) -research for a personal style -no showing off - yes irony -fluid, less structured form -lack of details, calm and masculine colors

industrialization

(preparing garments to be manufactured in small/large series): technical documentations (bill of materials, specification cards, equipment, testimonial items, sizing, nesting...) - quality standards sizing and nesting placement computerized cut

economies of scale

(sharing activities/resources): common manufacturing facilities, distribution systems, or sales forces (while considering the cost of coordinating the use of common activities by different business units); and also intangible resources, such as the brand

advantage of related diversification: economies of scope

(sharing activities/resources): common manufacturing facilities, distribution systems, or sales forces (while considering the cost of coordinating the use of common activities by different business units_. And also intangible resources such as the brand

segmenting the fashion system: technology - product category

Apparel (jacket, trousers, shirts, jeans...); LG: bags (handbags, backpack) and luggage; Footwear (boots, mocassins, sandals)...

the merchandiser - roles and skills

-MD is the link between marketing/sales/supply chain and product design/development (overlap with brand manager) -Need for technical and personal skills. Coordination of the first line managers and relationship with top management -one md for each brand in particular he/she -is not a designer but is quite knowledgeable on fashion trends -is aware of time constraints -is aware of supply chain challenges -has relationships w marketing team -he/she visits clients, distributors and agents, he/she knows the diversity of different markets in terms of clientele, products and services -he/she assists in sales campaign and known sales methods of agents and distributors, evlates requests for integration of the sample collection, is involved in sales to "special" clients -he/she is responsible for the database of sell-in sell-out data, which regularly communicates to the design and product department -he/she is up to date on marketing strategies of competitors (new lines, pricing strategies, distribution channels) and supports competitive intelligence (field work, especially) -he/she prepares and guarantees the merchandising plan and ensures that it is circulated throughout the company he/she can link with management control systems

design: types of designers

-Maison -Art directorship -Internal design team -Free lancer

fashion products: product categories

-Major types in apparel (skirts, shirts, trousers for men and women) -Shoes (sandals, sneakers, boots) -Bags (backpacks, basket, shoulder) -Luggage (trolley, sport bags, beauty cases) -Within each category it is possible to identify -styles/models (unique patterns) ---Mens jackets (2 or 3 buttons), mens shirts (open neck, button down), womens trousers (cigarette, capri, bell bottom, boot cut), bags (kelly, baguette), shoes (different heels, pointed or square shoes)

licensing department main activities

-Management of licences business and licensees' relationship in coordination with internal company departments -One of the most complete jobs you can get in fashion - need to know about all pieces of value chain -identification and assessment of new licensing opportunities -negotiation, renewal and buyback of licensing contracts -coordination and definition of licenses' business development strategy -control brand image -coordination and definition of licenses' product, price, promotion and placement strategy -control of licensees' product development process and quality -control of licenses' distrbution -control of licenses' marketing, merchandising and promotion efforts work with: design, marketing, pr, retail, regions around world, legal, and finance departments

made in italy: the second cycle

-Mid 60s and mid 70s -Emergence of a new generation of italian designers cooperating with the industry -Armani/Cerruti -Versace/Genny -Soprani/MaxMara

is a revolution taking place

-New approach to the seasonal schedule: see now buy now- How many brands follow the new approach -Burberry aligns runway and retail calendar in game changing shift -Following fashion shows clothes were immediately available to consumers ('16 sunway) moschino does this in '14 and '15

wall unit

-Personalized retail outlets with an external commercial setting (typically a department store) -Not a separate area -1-2 walls -Personnel may be specialized

chanel corporate info

-Private french company with subsidiaries in Japan and US (Wertheimer family for US) -Published full financials in 2018 for first time -Revenue of 9.6 bn in 2017, 12% increase from 2016 and profits of 1.7bn (up 19%) -40% sales in europe, 33% in asia/pacific, 20% in ammericas through 190 boutiques clothes and jewelry cannot be bought online controls many specialty ateliers

types of innovation: the traditional approach

-Product and process innovations -Radical and incremental innovations -technical/economic/aesthetic/symbolic innovations New for the industry or new for the company: innovation oriented companies vs followers and me too Synthetic fibers Mini skirts Outlets Fast fashion PLM (product lifecycle management)? Ecommerce

sales analysis

-Product categories -Number of models -number items sold -avg number of items sold -Also have it as a percentage on the next slide

licensee points to be evaluated

-Product know how -Distribution network and quality -Consistency with core brand in terms of positioning and price -Financial strength -Business plan (expected turnover, marketing investments, royalties, MGR..) -Organization structure (i.e. dedicated team) -Current licensee portfolio

chanel's style

-Quality, comfort, proportions, simplicity, distinction: freedom -Adapted men's sportswear to women dress: jersey, short skirts, trousers, no corset -Applied the cult of gentleman understatement to women: symbolism of the color black -Movement is the key word: "flexibility is power"

increasing online sales

-Relevance of e-fashion is growing in europe -Clothing - 20.3% of online sales, shoes and lifestyle is 10.8% -Clothing grew 10.5% 2014-2015 and shoes/lifestyle grew 11.8% -In Italy, e-fashion plays a major role: in 5 years the online consumers have doubled, from 9 millions of buyers in 2011 to 18,8 in 2016. In Italy,"clothing" is ranked as the fourth best seller online category after only phone credit, travels and books, CDs, DVDs (Netcomm, 2016).

what to do about diffusion lines

-Reposition (Miu miu) -Shut down (D&G) -Save money by hosting the different lines under the same roof (flagship stores: burberry)

collection development - research and development of fabrics and materials

-Selection of suppliers proposals (in exhibitions and ad hoc) -Special development with suppliers-partners (codedesign) -Appraisal of new proposals as compared to continuative proposals -Preliminary control of quality standards

future of social media

-Social media integration -Content marketing -Artificial intelligence -Employment of online and offline -WOM -Transmedia storytelling -Online-offline integration -Geo - Localization services

offline rationalization

-Store closures (Gap -150, Sears - 200, Walmart - opening smaller stores) -Between 2008 and 2013, the UK number of unused commercial spaces grew 335% -Players such as amazon are winning and gaining market shares -Online players increasing -Offline players considering different strategies -New business models: bricks and clicks

brand extension and growth - armani case

Armani brand extension strategy has been doing horizontal extension (different targets, occasions of use, product categories, businesses) and vertical extension (price segments)

Dispute on UGG brand

-The brand UGG Australia, owned by Deckers Outdoor Corporation is registered today in more than 120 countries -There have been many litigation suits on the validity of the brand UGG Australia -In the US and the Netherlands the courts reject to request to consider UGG Australia as a generic brand, confirming the validity of its registrations -In 2006, the Australian Patent Office also confirmed the validity of the brand "UGG Australia" owned by Deckers

how to fight counterfeits and imitations - UGG

-The quality: materials are special. Sheepskin has a special feature: it keeps you cool in summer and warm in winter. First boots were very simple, now the collection is vast, in colours, shapes and materials. -UGG Australia has employees in the Intellectual Property Dept. to control web sites that sell counterfeits (fakes). -The brand UGG Australia invests in communication on its website and continuously innovates the product, but the problem still exists.

french fashion model characteristics/values

-Tradition and individualism (social values) -couture , accessories and beauty (product) -Sophisticated and provacative (image) → luxury

programmato

-Typical logic of the industry (maisons and high end brands); -Collections are presented in january/february for AW, July/September for SS. Deliveries are planned for jan/feb for SS and july/sept for AW -Advantages: made to order, right time for manufacturing, planned cash flows -Disadvantages:... Evolution: the number of collections has been increased, e.g. 2 main collections with 2 pre-collections and flashes

monobrand brand portfolio

-Unique brand and focused products (chanel, bulgari before the acquisition) -Many lifestyles - endorsed brands (Armani, Valentino, Versace)

design: means of growth

-acquisitions -internal growth -partnership (licensing - franchising)

brand extension - advantages to licensor (the brand)

-brand receives royalties and contributions for advertising -awareness of brand increases -brand enters new businesses without investments (but it does not improve capabilities)

flagship store

-can have more than one flagship -central locations -selling area: 200-5000sqm -all product categories -DOS (directly operated stores) -specialized sales assistants personalize flagship store and product according to store location

what is design

-design is a process -usually associated with furniture -from furniture to furnishing (including household goods, lighting, and accessories) -in the past, italian companies reached the highest levels of innovation, especially in aesthetics -extraordinary combo between entrepreneur and the external designers -origins date back to WW2

collection development style/fit(prototyping)

-development of fit for new look -evaluation of new fit/material combinations -CaD/CAM technologies, 3d technologies (accessories)

corner store

-external commercial setting (typically in a department store) -not a separate area -2-3 walls plus floor -specialized (more often) or non specialized sales associates

why have brand extensions

-growth -increase brand equity -economies of scope -revenue enhancement

ways to grow

-internal -partnership/licensing -acquisiton

Types of Brand Extensions

-line and brand extensions -vertical and horizontal -strategic and complimentary

segments of luxury fashion

-luxury (most inaccessible): unique items -medium luxury: limited series, -PAP -accessible luxury: larger target, lower price, marketing activities (perfumes) luxury brand offer larger collections in which there is room for accessible pieces

fashion

-moda -continuously changing -in vogue --> hits a large number of people -today the rhythm of innovation is very high in many industries, to involve and compel consumers to buy new products

raw materials

-natural: animal and vegetable -artificial -synthetic

main points of licensing agreement

-object -trademark -products -duration -territory -intellectual property -stock/sell termination -commercial distribution activities -quality guarantee/defective products -pr/marketing -data transmission -royalty/minimium guaranteed royalties -payment conditions -auditing rights

the new store: from retail to experience management-5 experiences

-sensorial -emotional -creative-cognitive -physical -social feel that all senses are involved in a way (sight, smell, sound, touch, taste)

advantages of "retail"

-service --> CRM -experience -control over BI -access to market -location

actors in the trend spreading process

-textile companies -trend hunters -media (b2b) -apparel companies -celebrities -retailer -media (b2c) -consumers all interconnected

LICENSOR advantages of branded real estate

-to exploit the know how of licensee -the licensee distribution network -no investment -royalties

trading up in the luxury system: uber premium

-uber premium is everything that is truly out of reach to the vast majority of consummers -uber premium is increasingly found in services: an exclusive personal experience can brovide for hard-to-imitate uniqueness in ways physical (and uniform) products cannot

gen z

0-20 , spending parents money, demanding uniqueness, 27/7 availability (at click), tailored entertainmment, 360 experience, omnichannel

principles of sustainable communication

1. USE POSITIVE MESSAGES 2. WALK THE TALK 3. TRANSPARENCY AND AUTHENTICITY 4. ACCESSIBILITY AND INTERACTIVITY OF INFORMATION 5. CREDIBILITY 6. RELEVANCE 7. NARRATION 8. INNOVATION 9. SIMPLICITY 10. EMOTION

global distribution preferences diverge

Asia pacific leads the way in terms of internet retailing, driven by tech-savvy consumers in China and South Korea Consumers in Western Europe and North America are already comfortable with the multi-channel strategy followed by key players Middle east and africa remains the region with the lowest penetration of internet retailing, followed by latin america

8 distinctive features of italian quality (altagamma)

1. aesthetic vocation (style, design, appreciation for beauty, elegance) 2. artisanal quality (manual skill, eye for detail, passing on of manufacturing experience, creative craftsmanship that is never repetitive) 3. cultural and artistic heritage (relationship with the past, importance of roots, identity, sense of belonging to a community) 4. social qualities (sense of community spirit, family businesses. manufacturing districts) 5. relational qualities (ability to construct empathetic relatioship,s welcoming, warm, hospitality, convivality) 6. variety multiplicity (richness of nature, culture, production, variety of cultures, styles, tastes) 7. overall quality of life (italians know how to live, more relaxed rhythms, simple everyday pleasures, sense of lightness and authenticity) 8. creativity (flair, talent, passion, curiosity, flexibility, ingenuity)

social media strategies in fashion

1. build up a social media plan 2. involve the audience in the implementation 3. produce content that involves the fan/follower 4. use the right "web oriented" language and "tone of voice" 5. engage through technology 6. involve the bloggers 7. create online shopping experience 8. grant online and offline integration 9. monitoring

the 10 fair trade policies

1. create opportunities 2. develop transparent and accountable relationships 3. build capacity 4. promote fair trade 5. pay promptly and fairly 6. support safe and empowering working conditions 7. ensure the rights of children 8. cultivate environmental stewardship 9. respect cultural identity

manebi's success factors

1. focus on espadrilles (monoproduct brand) 2. commercial visibility through high end wholesale buyers and high end retail audience 3.visbility towards the national and international press and toward important personalities from the world's fashion and entertainment

types of smart hyperconnected consumers

1. online product research and price comparison before buying offline IN STORE 2. digital throughout the process (sometimes look in store and then look for lower prices and wider range online) COMPUTER 3. rely on mobile for all phases MOBILE PHONE

programmato (made to order)

1. style and design and product development → fashion shows, showroom presentations 2. collection of orders → buying session (retail), sales campaign (wholesale) 3. sourcing and production → quality control, logistic 4. distribution

total worldwide consumption of luxury goods (and italian percentage of that)

1.161 bn euro italian brands have 9% market share

coco chanel

1883-1971 "Fashion is not something that exists in dresses only. Fashion is in the sky, in the street, fashion has to do with ideas, the way we live, what is happening" about being exclusive and special not big

tods growth case

1900-began as family business 1970-expansion through licensing 1980-launch of trademark mocasin 1985-launch of hogan shoe and fay apparel 2000-goes public in milan se 2003-shows double digit growth for third year in a row multibrand and focused multibusiness strategy -tods, hogan, fay, roger vivier

christian dior and dior style

1905-1957 -"New Look" meant rounded, narrow shoulders, round hips, very thin waists and bell skirts in luxurious fabrics with flower embroideries. According to many, this was a restoration that brought women back to Belle Epoque.

valentino growth strategies - timeline

2006 - Permira VFG (2.6 bl), Stassi is the new CEO **Valentino was originally in Fashion Group with Hugo Boss (check) 2007 - Valentino and Giammetti step out in September A. Facchinetti is the new creative director (CD) 2009 - perfect storm - SS: revenues decrease by 9% to 232 ml. EBITDA is negative, Chiuri and Piccioli are the new CDs 2012- Mayhoola PE acquires Valentino (700 ml.) new flagship in Milan - just buys valentino company 2013 - revenues increase by 25% (to 488ml, the indsutry growth is 2%) 2015 - revenue increase by 48% 2016 - revenues are 1.1 bl, Chiuri joins Dior in July, 150 ml. In meanswear, 170 stores Revenues from 200 ml to 1+ bl in 10 years

market segmmentation: italian womanswear

8-9% couture, ready to wear, diffusion 11-12% diffusion, upper bridge 80% mass divided between classic, updated, metropolitan, and avantgarde

brand definition

A brand is defined by a system of attributes: Physical - brand system of signs (name, logo, colors, pay off) Intangible - brand values and associations as perceived by consumers

trading up the mass market segment: "masstige"

A retail category that includes brands and products that have high-end, prestigious characteristics but with prices and locations that make them accessible to a mass consumer audience ... The blurring of the distinction between the prestige and mass end of the market across many elements of the marketing mix ... A fashion statement that mixes both mass-produced and prestigious clothes

trademark

A trademark or trade mark is a distinctive sign used by an individual, business organization or other legal entity to distinguish its products or services from those other entities Requisites -Distinctiveness -Novelty (newness) -Legality (registered)

why convergence in fashion exists

Aesthetic compatibility → visual fit among different products that are combined together (mix n match) Social compatibility → coherence of a system of social meanings used in the same social context

proudly made in the USA

American fashion originated with menswear to satisfy demand for factory-made clothing for sailors, slaves and mine workers -First clothing factory was for the army in Philadelphia, 1812 -Tailor made shops then developed on the east coast (Brooks brothers was founded in 1818) -Hove invented the sewing machine (1845) -The gold rush in 1848 opened a huge market (Levi strauss started in California) -Women made their own clothes During the 1920s, women fashion magazines became popular (Vogue and Harper's Bazaar) Two different types of retailers developed: chain stores selling low price merchandise and specialty stores with high fashion merchandise (Bergdorf Goodman, Saks fifth avenue, Neiman Marcus...) In 1935, du point developed nylon After the second world war, chains stores like Lord and Taylor begin to advertise their national designers Typical american sportswear begins; the superior marketing approach allows the american brands to penetrate the international markets In the 60s, a new designer generation started I n the 1970s, the apparel industry faced a major crisis worldwide During the 90s, American fashion loses its position of isolation and emerged as a global phenomenon the big US department stores have always collected and filtered new trends

uniqlo

Global markets driving future growth Tadashi Yanai, founder and chief executive of fast retailing, which owns uniqlo, is fond of saying that "uniqlo is not a fashion company, it's a technology company". And indeed, the brand's approach to making apparel has more in common with the iterative approach to product development embraced by the technology industry Opposite approach of zara - planning production of its wardrobe essentials up to a year in advance -Don't have seasonal fashion themes like other companies - much ore product focused Business model: R&D and materials - 400 staff and takumi work with 70 contract partner companies

merchandising grid

Group together products that share fabric or stylistic ideas Want to have more or less 14 lines in terms of style

one market serving markets of one (altagamma)

Growth model will overcome current boundaries, shaping new competitive maps. Brands will become excellence/idea platforms enlarging their relevance

gucci growth case

Gucci has been growing mostly through brand acquisition with the objective of targeting new customers (as in the case of stella mccartney and a mcqueen) or acquiring new capabilities (as the case of bucheron) This strategy isnt without risk. Main risk is of overlaps and cannibalization of the brands (as in the case with gucci and YSL) while this strategy works well if the complementaries among the brands are exploited (back office: execution, execution, execution! D.De Sole). Investment is very consistent

haute couture - paris 2019 timeline

HC S/S 2019: 21-24 jan 2019 HC F/W 2019: June 30-July 4 2019

segmenting the fashion system: price ranges

Haute couture, Ready to wear (PAP), diffusion, bridge, mass (apparel-womanswear)

millenials vs gen z

How they receive info Millenials - born with 2 screens 1981-2000 Gen z - watch up to 5 screens (watch, iphone, laptop, tv, computer) -Born with an iphone in their hand -2000s

levis sustainable fashion

How to be more sustainable Challenging with jeans - made of cotton Reduce water used in manufacturing of jeans (water less jeans) A step further - wash at 30 degrees

CSR Guidelines

ILO principles, UN Declaration of Human Rights, Global Compact and OECD guidelines for multinational companies...

gucci and responsible luxury

Improving supply chain and initiatives around sustainability Leather than was sustainably sourced and not causing deforestation Gucci garden - connection between fashion and art In conjunction with the Rainforest Alliance and National Wildlife Federation, Gucci has launched a collection of sustainably-sourced leather handbags for the Green Carpet Challenge(GCC). The bags are produced respecting ethical treatment of cattle as well as setting standards for ecosystem conservation, water quality and pasture management. Each vegetable-dyed bag comes with its own GCC stamp and also a passport, which details the history of the supply chain. Among the luxury brands Gucci was the pioneer of responsibility: since 2004 Gucci implemented several projects to MAP, MONITOR THE SUPPLIERS, AND CREATE with them a real PARTNERSHIP, without fousing on communication.

top brands from 2018 ranking

In 2018 the first 10 brands are: Apple, Google, Amazon, Microsoft, Coca Cola, Samsung, Toyota, Mercedes, Facebook, Mc Donald's. In 2018 Zara is 25, H&M is 30. For sporting goods: Nike is 17, Adidas 50. In 2018, LV is 18, Chanel is 23, Hermes 32, Gucci 39, Cartier 67, Tiffany's 83, Dior 91, Burberry 94, Prada 95

business logic

In fashion, two main business logics are featured: -Programmato -Fast fashion In all industries there are companies following a make-to-order-pull (MTO) approach or a make to stock-push (MTS) approach

streetwear/athleisure/sneakerization

In the '80 we start talking about streetwear, a concept originated from the culture of surfing and skateboarding Shawn Stussy started to decorate his surfboards; in 1980 he made a partnership with Frank Sinatra jr to launch a clothing line; the brand became popular in Europe and in Japan, even if SS was not in the company any more Luca Benini, the founder of Slam Jam, meet SS in 1989: "Basically, what I do is selling clothes. I would like SJ to be perceived as a seal of approval on the products we distribute, a bit like the Woolmark logo warranties quality on the different products that bear it" in Japan Hiroshi Fujiwara spread the streetwear using the concept of drop first. In 1991 in NY James Jebbia opened a sore with SS; 1994 the first Supreme store: "because there were not other decent skate shops around." In 2000 logo surfboards with the LV logo. *Bof, 2017, 2018

mobile mobile mobile!

In the past 2 years, mobile searches for "product reviews" have grown over 35% 51% of smartphone users have purchased from a company/brand other than the one they intended because the info provided was useful 87% of smartphone users who reported tracking their own physical activity on their smartphones in the past month used the apps to do so 89% of people are likely to recommend a brand after a positive brand experience on mobile

why fashion brand ventures into branded RE

Key fashion and lifestyle brands, such as Versace, Armani, Fendi, Bottega Veneta, Bulgari are present in the real estate sector. Major fashion brands aim at creating a 360°lifestyle. This usually starts with the creation of a home line and then develops into interior design projects, which have become an essential part of the fashion business more and more fashion brands are now launching interior design projects: − They represent a completion of a 360°lifestyle concept and a way to enter into customers' everyday life by providing a unique and engaging experience. − Real estate projects in emerging economies help the brand to gain a dominant share in the luxury market at an early stage of its development − The entrance of fashion brands into real estate has increased the attention of the consumer on homeware products. − Private residential projects are usually supported by marketing and communication activities which enhance the visibility of the brand and particularly of the Home Collection − Branded residences enhance royalty revenues and sale of branded home products

raw material acquisitions in 2013

LVMH has bought a crocodile farm in australia. Then they also bought a stake in Heng Long, a crocodile tanner in Singapore Kering (Gucci) bought France Croco, a french tanner specialized in crocodile skins Gucci started the Python Conservation Partnership, an initiative to control the hunting and breeding of pythons, used for bags Hermes bought Tannerie d'Annonay, a tanner specialized in calfskin

manufacturing (sourcing)

No relationship between localization of production and final destination of the product, apart from legal constraints (country specific). For example, logistics are based in Spain even if a product is manufactured in asia and will be sold in asia (allowing fast decision-making) Airplane transportation from china Suppliers are chosen very carefully with strict agreements on quality, labor conditions and environment Quality is guaranteed by suppliers: regular controls in inditex warehouses

categories of non specialized and specialized shops

Non specialist: DS (La Rinascente, Coin, Printemps, El Corte Ingles...), hipermarket, supermarket (Auchan, Carrefour...), mail order (La Redoute, Otto Versand..) Specialized: chains (Benetton, H&M, Zara, Pretanal, Tezenis, Decathlon) and independent and multi brand shops

brand, lines (lifestyles), collections

One brand - one line → seasonal offer: number of collections (at least SS-AW) One brand - different lines (sub brands or endorsed brands) → seasonal offer for each line/lifestyle (Armani, Versace) More brands → number of collections (eg licensees such as Luxottica, Aeffe)

online influence on luxury purchases (altagamma)

Online channel will represent 25% of the market value. 100% of luxury purchases will be influenced by an online interaction

heritage and story telling

PLACE (Paris for Chanel, Milan for Armani) PEOPLE (the founder, designer, family) BRAND LEGEND PRODUCTS (Kelly and Birkin for Hermes)

concerted (seasonal) trends

Players in the pipeline contain the variety of textures, colours, fibers, fabrics, shapes by concerting them Concertation is made in meetings where trends are analysed and translated into product elements or guidelines Concertation meetings involve fashion show organizers, professional associations, fiber and yarns producers, final manufacturers, designers, trend offices Fairs like premiere vision (in Paris) are used to present concerted trends to industry operators nearly two years in advance on the collections Devil Wears Prada monologue about cerulean blue

brand licensing

Powerful marketing and brand extension tool, consisting of a business agreement, regulated by a contract, between the owner of a brand (Licensor) and the company (licensee) giving the licensee the right to use the brand in association with a product of a different nature than the licensor core business (ie ready to wear) for an agreed period of time within an agreed territory

amazon advantage

Prices - 13%-20% lower Assortment - 17x wider Cost structure - 3-4% lower Customer satisfaction - highest in industry

armani brand portfolio 2005-vertical extensions

Prive, Giorgio Armani, Armani Collezioni, EMporio Armani, Armani Jeans, AX Haute couture, ready to wear, diffusion, upper bridge, medium bridge, mass market

valentino main changes

Product → menswear → accessories (shoes, bags), rock stud Superior craftsmen and always bring something new → SS Accessories (now 50% of revenues), menswear (starts in 2012, in 2017 200 ml) distribution: -Retail: new flagships and locations -Wls is key, ecommmerce, alibaba and YNAP -Retail → new flagship in milan -Ecommerce Alibaba internationalization -China? For other competitors is more than 50% of sales communication -digital approach organization -new organizational structure

triple bottom line approach

Profits, planet, people Economic principle requires the adequate production of resources so that society can maintain a resonable standard of living, the envirnmmental priciple asserts that society protects its environmental resources, the social pricniple requires everyone to be treated fairly and equitably Economic, environmental and social perspectives to a business

haute couture

Protected expression used for a limited range of couture houses, satisfying a set of well-defined criteria in terms of product and branding founded by la chambre syndicale de la couture in 1868 today governed by federation francaise de la couture Membership is still limited and members are bound by rules of the exhibition of collections dior, versace, chanel armani prive, etc

fashion products: quality

Quality: fabrics, accessories, finishing touches, manufacturing (embroidery, sewing) In accordance with special rules: safety measures, fireproof, hypoallergenic fabric Product duration: resistance, washing, shrinking Performance: fit, comfort, season requirements, specific uses

EBIT/INV

ROI ebit/rev x rev/inv

product strategy (positioning) and stylistic identity price range

RTW, diffusion, bridge, mass

eco fashion: green and recycled

Reducing, reusing and recycling of resources (water, energy, raw materials) along the pipeline Use of organic and natural fibers Use of vegetable dying Vintage practices and second hand green certifications

bottega veneta branded re

Residences - berlin Hotels - rome and florence st regis, park hyatt chicago

H&MM

Right goods → right quality → right store → right country → right time H and M, Hennes & Mauritz, was established in Vasteras Sweden by Erling Persson in 1047 originally , H&M was known as Hennes meaning Hers, as the store sold only womens clothing In 1968, Mauritz Widforss, a stockhom hunting equipment store, was acquired and H and M was renamed as Hennes and Mauritz with the expansion into menswear In 1974, H and M is listed on SSE In 2008, the new retail concepts COS and in 2009 H and MM Homme have been launched; in 2008, Cheap Monday, Monki, and Weekday are bought In 2013 launch of new brand & Other Stories and online shopping in US In 2014, new H&M Sport is launched and H&M is in 53 countries (Germany is the first market) Around 800 independent suppliers. Change suppliers often → to ensure the best offer at all times. 20 production offices in the world. 100 in-house designers who work with buyers and pattern makers

SS FW Collections sell in/sell out

SS Collections -When the new collection starts, data available is: --Sell-in of the previous SS collection --Sell-out of FW FW collections -When the new collection starts, data available is: --Sell-in of the previous FW collection --Sell out of SS

hypermarkets

Superstores combining supermarket and department/variety store -Offer an enormous range of products, including full lines of groceries and general merchandise -Hypermarkets typically have business models focusing on high-volume, low margin sales -They're generally located in suburban or out-of-town areas, easily accessible by automobile -Aggressive pricing is not only financed by high sales volumes, but also by the low cost of sales space, greater autonomy in terms of logistics when compared with smaller retail outlets, and faster turnover of goods and longer opening hours -Carrefour, metro real, tesco

italian fast fashion brands

Terranova Motivi Plaza italia Original marines revenue under 500 euro stores 500 or less ownership - diff profiles

distinguishing counterfeit vs original UGGs

The brand UGG Australia has many imitations and counterfeits. These ones some from China, available on-line and unconsciously bought by customers It's possible to recognize the original ones by looking at: -The packaging -The stitching -The material should have flexible sole, no hangtags, no enlarged heel or too tall of boot shaft

sustainability and CSR in fashion

The concept of sustainability was defined in 1987 in the Bruntland report and was then adopted by the United Nations' World Commission on Environment and Development (WCED): "Sustainability means being able to satisfy current needs without compromising the possibility for future generations to satisfy their own needs" Compliance with agreements of the ILO Social work with ethnic minorities from disadvantaged or underdeveloped areas Traditional methods of production of particular areas or countries Compliance with the fair trade criteria: creating opportunities for economically disadvantaged producers, transparency and accountability, capacity building, promoting fair trade, payment of fair price, gender equity, working conditions, child labor, the environment and trade relations

evolution of competitive advantage: LV

To sustain their luxury positioning, LV combined the injection of fashionability (many collaborations) with the launch of heritage-focused campaigns and upstream control

4. use the right "web oriented" language and "tone of voice"

Twin-set uses a wen oriented language: publishes Quizzes, and asks many questions to fans, not only regarding the products Terranova uses slang language with the fans Armani cannot use slang but the language is very simple and direct. Frequent use of questions What to avoid -Adidas-negative comments left unanswered -CP company - no taglines -Miss sixty - posts of fan without any enhancement

uniqlo inovation

Uniqulo ultra light duvet jacket was innovative - now everyone has it Founder feels they are a technological company not a fashion company Quality high, designs are simple

5. engage through technology

Use of "video-catalogues", "virtual mannequin" and "virtual goodies" create info-tainment H&M -Selecting an item of the collection you get a chance to try it on a virtual mannequin -You can change the face of the mannequin choosing among different types -You can also change the background and turn the mannequin back -The look created can be shared Mango -Used to publish video episodes (TV series) on the lives of young people providing advices on how to dress according to each occasion -Possible to share the videos and buy the looks worn by the actors going on "get the looks" and connects to the e-commerce website Burberry -Looks can be viewed by different angles with the opportunity to zoom the detail and high image quality -The lookbook is animated - you have the option of moving the images as if they were real models and stop at the point of interest

h and m sustainable fashion

Using sustainable raw materials by 2030 - see if they will use sustainable raw materials Need high level of control to do sustainability

positioning/business definition

What a single company offers: which products, price ranges, customers, channels, ... positioning --> has to do with brands quality/price

specialty chains

Wider geographical reach -Single industry specialists (Zara, Gap, Beneton, Top Shop) -Single pruduct specialists (Yamamay lingerie) -Single client specialists (Chicco and Prenatal for mothers to be and kids) -Single occassion of use specialisrts (Decathlon for activewear)

CSR main standards

Worldwide Responsible Apparel Production (WRAP), Social Accountability 8000 (SA8000) , Global Organic Textile Standard (GOTS)... Given the absence of armonization among the countries' regulations the different countries have different behaviours in managing sustainability. Most is left to the voluntary actions of the companies.

zara innovation

Zara - fabric cutter that is computer operated - innovations to the fashion industry

convergent designs in fashion

a convergent design is a design - a specific combination of fabrics, colors, cut, length, and graphics - that is adopted by the majority of firms within the industry

premium brands

brand image, marketing mix -Heterogeneous group -Know how: industrial and commercial -From upper bridge to diffusion (for a younger customer) -Vertical integration through networks of different partners -price/quality ratio -Evolution from industrial medium companies (that were also licensees and designers) to: --monobrand/multibusiness (Zegna) --multibrand/multibusiness (Aeffe, only the brave) ----In both cases they are emphasizing the design dimension

american brands: value and characteristics

accessibility (social values), casual and basic (product), fresh and simple(image) --> branding

apple store experience

accessibility to products everything is on display

accessible luxury

advertising, price < 1000

AEFFE Group

aeffe group designs, manufacutes, and retails pret a porter, shoes, leather goods, lingerie and beachwear collections are produced for directly owned brands (alberta ferretti, moschino, pollini) and brands under license they are licensors for perfumes, childrenwear, watches and eyewear brand portfolio: moschino, philosophy, alberta ferreti, love moschino

segmenting the fashion system: customer

age, gender...

etailers starting to open physical stores

ammazon, farfetch, alibaba idea that there is something in physical space you cannot do online -immediate contact with consumers -custommizability -touch products bonobos - using the physical in order to personalize the experience - showrooming

raw materials: natural (animal)

animal: wool cammel, dromedary, alpaca, guanco, mohair, cashmere, angora silk wool fiber is obtained by shearing the sheep

most important fashion sectors

apparel (clothing), shoes, bags because of seasonality

armani horizontal brand extensions

armani casa, sportswear line, flowers, beauty, snow, golf

personal luxury goods:

art de la table, hard luxury, clothing, accessories (LG, shoes, ties), beauty above 250-300 euros for shoes/pants/jeans/skirts above 1000-1200 for handbags, dresses, watches, jewelry

prada store experience

art, design, concept store

IOU project

asking customers to complete the story Spoke-person: Kavita Parmar Use of sustainable raw materials Authentic Madras made in India 100% online distribution Track&trace on each item (ID code) New supply chain: "prosperity chain" Consumers can complete the story by posting pictures and becoming "trunk show hosts")

aesthetic innovation: style and style codes dressing styles

avantgarde, characterised, modern, classic

dressing styles

avantgarde, characterized, modern, classic

omnichannel journey

awareness-through tv and online research-through online and app purchase-store or online fulfillmment-delivered directly loyalty-providing the brand feedback and recs

hermes manufacturing

berkin and callie - named after celebs who have used the bags Hermes produces about 3,000 crocodile bags per year - price is $40,000 or more Clients can only buy 1 bag per year 4 crocodiles are needed for each bag (they use only the most precious part of the skin) The best species is crocodylus pososus raised in Australia in Queensland. These crocodiles are very aggressive and it is difficult to breed them; they could bite each other, spoiling their skins Australian breeders export more than 100,000 skins per year, enough to satisfy global demand In 2009 Hermes became vertically integrated in crocodile skin - acquired farms due to sourcing difficulties

rana plaza disaster

biggest but not only (and not last) - disaster in the industry → fashion revolution Consumers have started asking more and more how products are made

giorio armani - identity in communication (codes)

black and white, no super models, american movies

tods sustainability

built elementary high tech school

branded real estate

new licensing fronteir Branded homes provide the perfect blend of an attractive investment and a desirable lifestyle and carry the distinct merit of confidence particularly in markets where buyers don't know who to trust for their investment. Such a collaboration also brings a sense of exclusivity and luxury. Creating bespoke design solutions for ultra high net worth indivs. Is the equivalent of fashion haute couture (Christies intl re) "Branded developments offer a plethora of advantages for buyers, investors and occupants alike. Branded developments sit at the most competitive and innovative edge of the market. This is the sector where developers are attempting to reinvent the concept of the residential development, - this innovation attracts buyers who are looking to buy into the latest trends." (knight frank)

fashion collections - innovation

new patterns and new fabrics or refreshes SKUs: stock-keeping unit, used also in Italian companies (referenze, articoli, items)

end of mass media

newspapers and directmail decreasing radio and internet increasing outdoor, transit ROPO to mobile mobile mobile (product review searches have grown over 35% in past 2 years)

earned media

no control over it, no development costs, max credibility, can be negative if a blogger reviews your brand, wom, digital pr --> get strategic insights for media owned

format segmentation - specialized and non specialized

non specialized: department stores, variety stores, hyper and supermarkets, etailers specialized: specialty chains, factory outlets and FOC, indep stores

genderless

not possible to judge the sex of millennials by their clothes Gender free clothing is the tangible manifestation of a new lifestyle, rather than a simple temporary fashion statement Eg - metrosexual style (masculinity and in touch with ones feminine side) Created after 2000 in the streets of cities like NY or Milan - endorsed by celebrities, pushed by the media, adopted by D and G, Armani and others

mutlibrand group: market power synergies

not really relevant unless with Malls, Media, Department Stores (using the power of well established brands for the others)

fashion collections: structure (architecture) for the season

number of parts/sections (pre-collection, main, flashes, capsules, limited editions, cruise), selling campaigns, deliveries, price ranges, life occasions, stand alone or outfit, color stories, fashion content

synthetic raw materials

obtained from man made molecules, produced by chemical means by a synthesis at the start of the 20th century, man made fibers accounted for only 1% of the american fiber in the market but now accounts for 70% of all fibers used

artificial raw materials

obtained from organic macromolecules already existing in nature

formalwear (occasion of use, product categories)

occasion of use: ceremony, evening/cocktail, shopping/daytime, worktime product categories: dress, suit, tailor, elegant, coat, elegant shoes, formal shirt, tie

sportswear/casual and jeanswear (occasion of use, product cateogires)

occasion: daytime, leisure product cateogires- jacket, balzers, trench, pants, padded jacket, boots, loafer, denim jeans, chino, polo, t shirt, sweatshirt, sneaker

altagamma

offers support to entrepreneurs, managers and workers Broad range of activities to strengthen the competitiveness of businesses: from knowledge of the markets to relations with institutions, from networking activities to those dedicated to specific industry issues business development, business culture, promotion of the altagamma system members: italian companies in luxury fashion, design, food, hospitality, cars, boats, etc

distribution strategy: direct channel

offline formats: flagship store, self standing, shop in shop online formats: e-flagship store, e-shop in shop

advantages of multibrand group: corporate effect

operational synergies, financial synergies, market power synergies, corporate synergies

advantages of multibrand group: corperate effect

operational synergies, financial syngeries, market power synergies, corporate synergies

personal luxury goods market (altagamma)

overperforming other luxury segmments in 2018 luxury goods gaining traction in the last year intimate and less "showy" experiences are expected to be more valued by consumers, in particular younger ones luxury toys and out of home experiences keeping positive trend, but slowing down vs. the past, approaching a maturation phase

maliparmi (italian premium brand) store experience

padrone di casa - spazio nomade

cases in fashion: retailers

partnerships with: -designers (ie alexander mcqueen for target) -celebrities (madonna for h and m, jlo for yamamay) -high end boutiques -e-tailers (marni for yoox)

d&g product categories

perfume apparel -womanswear, menswear leather goods-footwear, womans bags, mens bags beachwear and underwear eyeglasses and sunglasses

advantage of related diversification: increased market power

pooled negotiating power, strengthening a firm's position in relation to suppliers and buyers

increased market power

pooled negotiating power, strengthening a firm's position in relation to suppliers and buyers

collection development: fundamental elements

positioning and target stylistic identity collection key factors (connected in a triangle)

collection guidelines: collection brief

positioning, price range, occasions and product categories, deliveries, design, volumes, manufacturing In some cases also: inputs for the design team-creativity

italian fast fashion

premium brand companies in the young apparel segment, following the "fast fashion" business model, managing an integrated network of suppliers: L'Altra Moda, Liu Jo, Patrizia Pepe, Pinko, in the Premium segment; Motivi, Terrenova, Piazza Italia, Original Marines in the Mass market

maisons

the path to evolution -the traditional path for Maisons is to grow through brand extension and to integrate upstream and downstream, and then, with the retirement of the designer or his death, to be managed by a creative director -Maison relying on licenses → integrated maison → maisons with creative director -Some italian maison are still relying on licenses (Cavalli). From the point of view of the ownership, some maisons were still privately owned (Armani, Dolce and Gabbana, Versace), some others have been bought by industrial or financial multibrand groups (Moschino, Valentino)

brand differential

the premium price created by the wtp more for a branded product

homologation

the process of certifying or approving a product to indicate that it meets regulatory standards and specifications

product strategy (positioning) and stylistic identity product categories/classifications

total look vs special categories

fashion collections: size factors

total number of SKUs (stock keeping units), number of product classifications (categories), (variety). In general: width (product categories, number of models and fabrics) and depth (colors and sizes)

surge of made in italy: the fourth cycle

toward the integration system - the 90s New evolutions in the industry • New players • New segments (i.e. upper bridge and better mass) • Entry of finance • Higher entry barriers (higher investments in advertising and retail) • New formula in product and retail: lifestyle concept -Industrial companies -Designers-entrepreneurs -multibrand/multibusiness groups -italian fast fashion

traditional business model vs inditex business mmodel

traditional: -Design -Sourcing -Stores -Customers Inditex -Customers -Stores -Design -Sourcing

chanel style and stylistic codes

tweed, chains and purses, special flower

examples of innovation

uniqlo live duvet jacket zara fabric cutter Mini skirts launched in the market - was revolutionary - skirts used to be much longer Mini skirts had symbolic meaning → women were free to decide how to dress Computerized software with precise cuts

absolute luxury

unique pieces, made to measure, handcrafted, precious materials, exclusivity roger vivier

big us fashion players

urban, gap, abercrommbie, MK, nike, ralph lauren, guess, under armour

factory outlet centers

value retail group chic outlet shopping factory outlet centers need to be far from metropolitan centers with flagship stores villages

segmenting the fashion system: channels

wholesale, retail

chinese luxury consumer (altagamma)

will account for 45+% of the market and half of their luxury purchases will happen in their on country

LVMH business groups

wines,spritis fashion and leather goods (dior, lv, givenchy, marc jacobs, fendi) perfumes, cosmetics watches, jewlery (bulgari,hublot) selective retailing (sephora, le bon marche) other activities (maisons)

product strategy (positioning) and stylistic identity seasonal codes and macro trends

within a certain stylistic identity they are new fashion elements that refresh and innovate the production in relation to trends in the industry

versace - lines

women and menswear lines have leather goods and shoes -Atelier (HC) -Versace womenswear and menswear (beachwear and underwear) -Versace collection, men 1991, women 2009 -Versus (C. Kane) W and (also watches and fragrances) -Versace jeans: W and , the only license in apparel -Young versace: Nursery, baby, kids, juniors

owned media

you control the media fully (fb, insta, company website) you know what info you are trying to upload best approach is holistic, where each media supports others media, as well as when paid advertising produces earned w-o-m which in turn stimulates the traffic owned micro sites cost efficiency, high control, low credibility --> image and brand awareness

fashion industry sales growth 2016-2018

~3-5% a year per category

fashion retailers: stores

• A direct presence is preferred • Adaption to local market demand (colours, products) • When it is not possible, they partner with local retailers or real estate companies • Some franchises, because of the market size or special conditions but: - no individual stores - prices, local assortment, store decoration, training and conditions are decided by Inditex

a lifestyle brand is..

• A set of rules...a call to action • Something new • With inspiring leaders Starting from young generations to convince larger groups

radical and incremental innovations

• Duvet jacket • Ultra light duvet jacket (Uniqlo) • Seasonal refreshment vs totally new shapes

d and g consolidated performances

• Revenues ('000 euro): (2017) 1,290; (2015) 1,030 • EBITDA ('000 euro): (2017) 156,260; (2014) 175,065 • Employees: (2014) 3,818 • In 2014: 40 countries and 3 international branches (NY, HK and Tokyo), 250 monobrand stores (90 Dos, 20 FO)

disadvantages of multibusiness-multibrand groups

• Scarcity of manager's attention (too many projects) • Bargaining power used to reduce costs and not to get better suppliers • Risk of brand flattening • Difficulties in finding the right way for each brand

advantages of direct channel compared to indirect channel

• To know directly the consumers (CRM) • Building the brand image • 360° shopping experience • Complete control on assortment/pricing/deliveriesàcontrol on positioning • Location • Higher margins

American fashion: licensing

• Under licensing agreements the brand owner (licensor) gives another company (licensee) the permission to use its name and design for production/distribution of one or more product category, within a specific territory and distribution channels, for a certain period of time. • For this the brand owner is paid a royalty (% of wholsale revenues) and receives a contribution to communication