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Competitive Strategy
Brief outlook
Brand analysis
SWOT Analysis
Brand strategy
References




5/18/2012
“For Prada, fashion, luxury and style have always been core aspects of a project that goes beyond
production of clothes, footwear and handbags. Careful observation and interest in the world, society,
and culture are at the core of Prada‟s creativity and modernity. This has pushed Prada beyond the
physical limitations of boutiques and showrooms, leading us to interact with diverse, seemingly distant
worlds, and introducing, very naturally, a new way of creating fashion”.



Miuccia Prada and Patrizio Bertelli




5/18/2012
Brief outlook
 1913 – Mario Prada opens a luxury store (handbags, shoes, trunks,
  luxury accessories, etc.) Handcrafted, sophisticated goods – rapidly
 70’s – the new era of Miuccia Prada & Patrizio Bertelli has started. They
  turned the label towards haute couture and internationalization.
 1985 – Prada’s classic elements with mohandbag (parachute nylon).
 1984 - expansion across continental Europe.
 1989 - Prêt-à-porter collection
 90’s – Fondazione Prada. New brand image blending traditional and
  architectural setting - benchmark for luxury retail.
 1992 – world’s expansion




5/18/2012
Brief outlook




5/18/2012
Brief outlook




5/18/2012
Positioning
                                   Target
                   1. Cultural creative, intellectualists, innovators.
               2. Affluent customers willing to spend more than most.


     Mario Prada’s initial collection of high-quality, functional travel
      accessories

     Miuccia Prada’s creative vision and passionate exploration for fabric
      and design innovation (i.e. fashional/functionable; simple; elegant)

     Classic and elegant collections while other fashion houses
      concentrated on sexuality

     Modern innovation through experimentation with unconventional
      fabrics and artistic backdrops in Prada retail stores




5/18/2012
Brand mantra

 Emotional:
  Stylish, Sexual
 Descriptive:
  Contemporary Classic,
  Elegant
 Brand Function:
  Self-Expression



  5/18/2012
Brand’s PODs
 Visual Identity/Architecture – 6 stores, designed by Prada (NY,
Tokyo, San Francisco etc.)
 Singularity: new materials in each new collection
 Usage of art in collections and supporting of contemporary art -
Fondazione Prada
 Special collections designed for some stores




5/18/2012
Brand analysis
•   Market Segmentation
    Market nicher, also working with customization through
    Prada Made-to-order collection

• Market nicher strategies
Quality-price specialist
Product line specialist


• Managing Brand Equity
Brand reinforcement through new and innovative collections.
Extensive brand portfolio through Flanker products, such as
eyewear, fragrances and Leather Goods


5/18/2012
Prada’s commercial




            http://www.youtube.com/watch?v=TjXhSQHMphc&feature=related
5/18/2012
Brand competitive analysis



     Value                Innovation,          Superior quality,     Sexy, cutting        Britishness,
  Proposition           elegance, Style           Classical              edge,          Democratic luxury
                                                                     contemporary



     Audience            Intellectual and        Self-made,         Modern urban,       Smart, authentic
                             creative            successful         fashion- aware        individuals
                           fashionistas            people               people

                                               Leather goods,
                                                                    Leather goods,         Leather goods,
Range of authority   Leather goods, Clothing, Clothing, eyewear,
                                                                   Clothing, eyewear,     Clothing, home,
                      eyewear, fragrances, stationery, jewellery   fragrances, silks,   fragrances, beauty,
                            jewellery                                   jewellery             jewellery


                        Self expression,         Achievement,      Confident, stylish   Heritage, Innovation
   Relationship          superior taste         career success                              and intuition


    5/18/2012
SWOT analysis
                  Strengths                                           Weaknesses

•Loyal audience                                •Private company – difficulty in acquiring funding;
                                               ongoing battle with corporate debts
•Multi brands stores all over the world
                                               •57% of sales- leather goods
•Successful alliances with LG and Toyota
                                               • Weak e-commerce participation
•Bright well-known, recognizable advertising
company                                        • Unfriendly policy to environment

• Unique heritage under Miuccia Prada


                   Opportunities                                      Threats
• Global markets growth -Asia esp. China       • Transparency of Internet lead to price consistency
                                               or “Burberry effect”
• Outsourcing production
                                               •Falsifications (esp e-market, touristic countries)
•Product alliances with new partners
                                               •Existing competitors and rising fashionable catwalk
•Franchises
                                               copycats (H&M, Zara)
•Digital market
                                               • European crisis
•Capture the younger generation consumers


    5/18/2012
#1. Geographical expansion




            In 2011 were opened 69 stores over the world
5/18/2012
#1. Geographical expansion




5/18/2012
#1. Geographical expansion

       The Luxury market is expected to
            grow 65% by 2015!

Points to consider…..
 Today Prada gets more than 42% of it´s
sales from Asia, more specifically from China.
But recently this market has slowed down
 Middle east market is expected to
double by 2015
 The travel retail channel is key. Sales to
travelers grew by 10pp in recent years




  5/18/2012
#1. Geographical expansion

 Expand presence in Middle east , especially UAE and Saudi Arabia.
 Reinforce presence and communication efforts is well known high
end tourists destinations, such as Monaco, French Riviera.

 LatAm (focus on Brazil)
 Big market opportunity due
to thriving economic
conditions and the hosting
of major events
(World Cup, Olympics)




  5/18/2012
#2. digital presence
                     Who wants to walk down Bond Street in the rain when you can sit on the
                                               sofa with a glass of wine, surfing the Web?

WHILE…
 65% increase in spending on luxury goods
expects by 2015

 98% of target audience is spending 13.1
hours pw online doing research before
making purchases

 in the USA reviews influence purchasing
decision of 89% target audience




Facebook                 1,719 K             7,957 K          7,948 K           12,836 K

Twitter               Don’t have             169 K             374 K             993 K
    5/18/2012
#2. digital presence
                                      Attract your audience. Create a desire!
                            Increase awareness and work for long-term sales.
 Tell the story
 Communicate the creative idea of Prada
 Convey your exclusivity
 Bring up younger luxury consumers

                                       Through



                                              The 360 –degree marketing strategy
                                              Connection between offline and online
                                              Using the mobile channel




   5/18/2012
#2. digital presence
                                       Make a purchase process easy!
                                             Increase sales right now.


 develop e-stores (web, mobile
app), focus on the well-developed
and developing markets (Europe,
UK, China, Japan)

 offer there incomparable
exclusive service




       And Prada become available to anyone around the
                          world!
  5/18/2012
#3. alliances
                        Prada for Nine West
       Featuring cobranded luxury goods in a fast fashion store acts as a gateway for mass
                       market customers to enter the luxury goods arena.




5/18/2012
Why Nine West?
 Similar target audience
 Focus on shoes, leader in the industry
 Nine West is especially strong in advertising, digital
   marketing
 Co-operation with large number of magazines-
Easy Living, Cosmopolitan, Instyle, Glamour, Vogue etc.
 According to media research Prada customers are loyal to
   Nine West brand*




*People who like this brand also
tend like other fashion brands such as
Chloé, Dior, Brora, Myla and Nine West.
People who like this brand tend to dislike
fashion brands such as Claire's, H&M, Dorothy Perkins, Coach and Bhs.
What is in it for us?
For customers                        For Prada
 The opportunities to try a new      Production price reduction
   product                            Sales increase
 A sense of excitement and           Coverage of the wide audience ,
   adventure,                           new market group
 Special Prada design with Nine      Test sales in the middle class
   West reliable quality                audience
 For Nine West fans- the prove of    Marketing resonance
   the brand high standards           Test E-sales




5/18/2012
Game plan to protect the exclusivity of untouchable
                                       brand

 A star launch party with performances by
celebrities on the preview
 Mass Media Resonance, promo in e-media
 Very limited availability and only in select stores.
 Short-term Sales



                                         So!
 „ While there is always a risk in rolling out a high-end brand in a mainstream
store, it can be done right. Even if your prices have to come down to reach the
   masses, you can make it work by maintaining a level of exclusivity in the
       shopping experience. And, no matter what, always stay on brand.‟
Versace for H&M preview
And the result surprises
                     you…



5/18/2012
Introducing a new form of beauty in the modern day….one that of
            paradoxical nature, “a girly edge, but in the end it is nasty” –
            Miuccia Prada




                                      Thank you.

                                      Questions?


5/18/2012
By:

  Olga Dyachuk & Darya Motornova & Alexandre

                   Ferreira




5/18/2012
References
•     http://theglassmagazine.com/forum/feature.asp?tid=614#title
•      http://www.pradagroup.com
•      http://www.americascup.com/en/Teams/Luna-Rossa-Challenge-2013/The-Boats/
•      http://www.cheapprada.org/blog
•     http://fondazioneprada.org/
•     http://www.prada.com/en /
•      www.youtube.com
•      http://www.prnewswire.com/news-releases/global-luxury-retailing-market-size-brand-strategies-and-
      competitor-performance-134669478.html
•      http://www.bloomberg.com/news/2011-12-16/prada-poised-to-extend-slump-as-china-s-shoppers-cut-back-
      spending-retail.html
•      http://www.independent.co.uk/life-style/fashion/features/one-step-ahead-an-exclusive-behindthescenes-look-
      at-what-makes-prada-the-worlds-most-influential-fashion-label-1818812.html
•     http://www.internetmarketingsolution.com.au/Internet_marketing__luxury_brands.html
•     http://www.prnewswire.com/news-releases/global-luxury-retailing-market-size-brand-strategies-and-competitor-
      performance-134669478.html
•     http://blogs.forrester.com/sucharita_mulpuru/12-02-27-us_online_retail_hits_200b (Forester Research)
•     “The luxury consumer in the new digital: then & now. 2012 Report”
•     http://www.ninewest.co.uk/
•     http://answers.google.com/answers/threadview/id/749041.html
•     http://www.slideshare.net/brlippert/nine-west-crative-brief
•     http://advertising.microsoft.com/research/luxury-lovers
•     “Luxury-Goods Stocks are Flying High”, MSN Money, December 20, 2010
http://www.marketingmagazine.co.uk/news/1104353/



    5/18/2012

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PRADA Marketing strategy

  • 2. Brief outlook Brand analysis SWOT Analysis Brand strategy References 5/18/2012
  • 3. “For Prada, fashion, luxury and style have always been core aspects of a project that goes beyond production of clothes, footwear and handbags. Careful observation and interest in the world, society, and culture are at the core of Prada‟s creativity and modernity. This has pushed Prada beyond the physical limitations of boutiques and showrooms, leading us to interact with diverse, seemingly distant worlds, and introducing, very naturally, a new way of creating fashion”. Miuccia Prada and Patrizio Bertelli 5/18/2012
  • 4. Brief outlook  1913 – Mario Prada opens a luxury store (handbags, shoes, trunks, luxury accessories, etc.) Handcrafted, sophisticated goods – rapidly  70’s – the new era of Miuccia Prada & Patrizio Bertelli has started. They turned the label towards haute couture and internationalization.  1985 – Prada’s classic elements with mohandbag (parachute nylon).  1984 - expansion across continental Europe.  1989 - Prêt-à-porter collection  90’s – Fondazione Prada. New brand image blending traditional and architectural setting - benchmark for luxury retail.  1992 – world’s expansion 5/18/2012
  • 7. Positioning Target 1. Cultural creative, intellectualists, innovators. 2. Affluent customers willing to spend more than most.  Mario Prada’s initial collection of high-quality, functional travel accessories  Miuccia Prada’s creative vision and passionate exploration for fabric and design innovation (i.e. fashional/functionable; simple; elegant)  Classic and elegant collections while other fashion houses concentrated on sexuality  Modern innovation through experimentation with unconventional fabrics and artistic backdrops in Prada retail stores 5/18/2012
  • 8. Brand mantra  Emotional: Stylish, Sexual  Descriptive: Contemporary Classic, Elegant  Brand Function: Self-Expression 5/18/2012
  • 9. Brand’s PODs  Visual Identity/Architecture – 6 stores, designed by Prada (NY, Tokyo, San Francisco etc.)  Singularity: new materials in each new collection  Usage of art in collections and supporting of contemporary art - Fondazione Prada  Special collections designed for some stores 5/18/2012
  • 10. Brand analysis • Market Segmentation Market nicher, also working with customization through Prada Made-to-order collection • Market nicher strategies Quality-price specialist Product line specialist • Managing Brand Equity Brand reinforcement through new and innovative collections. Extensive brand portfolio through Flanker products, such as eyewear, fragrances and Leather Goods 5/18/2012
  • 11. Prada’s commercial http://www.youtube.com/watch?v=TjXhSQHMphc&feature=related 5/18/2012
  • 12. Brand competitive analysis Value Innovation, Superior quality, Sexy, cutting Britishness, Proposition elegance, Style Classical edge, Democratic luxury contemporary Audience Intellectual and Self-made, Modern urban, Smart, authentic creative successful fashion- aware individuals fashionistas people people Leather goods, Leather goods, Leather goods, Range of authority Leather goods, Clothing, Clothing, eyewear, Clothing, eyewear, Clothing, home, eyewear, fragrances, stationery, jewellery fragrances, silks, fragrances, beauty, jewellery jewellery jewellery Self expression, Achievement, Confident, stylish Heritage, Innovation Relationship superior taste career success and intuition 5/18/2012
  • 13. SWOT analysis Strengths Weaknesses •Loyal audience •Private company – difficulty in acquiring funding; ongoing battle with corporate debts •Multi brands stores all over the world •57% of sales- leather goods •Successful alliances with LG and Toyota • Weak e-commerce participation •Bright well-known, recognizable advertising company • Unfriendly policy to environment • Unique heritage under Miuccia Prada Opportunities Threats • Global markets growth -Asia esp. China • Transparency of Internet lead to price consistency or “Burberry effect” • Outsourcing production •Falsifications (esp e-market, touristic countries) •Product alliances with new partners •Existing competitors and rising fashionable catwalk •Franchises copycats (H&M, Zara) •Digital market • European crisis •Capture the younger generation consumers 5/18/2012
  • 14. #1. Geographical expansion In 2011 were opened 69 stores over the world 5/18/2012
  • 16. #1. Geographical expansion The Luxury market is expected to grow 65% by 2015! Points to consider…..  Today Prada gets more than 42% of it´s sales from Asia, more specifically from China. But recently this market has slowed down  Middle east market is expected to double by 2015  The travel retail channel is key. Sales to travelers grew by 10pp in recent years 5/18/2012
  • 17. #1. Geographical expansion  Expand presence in Middle east , especially UAE and Saudi Arabia.  Reinforce presence and communication efforts is well known high end tourists destinations, such as Monaco, French Riviera.  LatAm (focus on Brazil) Big market opportunity due to thriving economic conditions and the hosting of major events (World Cup, Olympics) 5/18/2012
  • 18. #2. digital presence Who wants to walk down Bond Street in the rain when you can sit on the sofa with a glass of wine, surfing the Web? WHILE…  65% increase in spending on luxury goods expects by 2015  98% of target audience is spending 13.1 hours pw online doing research before making purchases  in the USA reviews influence purchasing decision of 89% target audience Facebook 1,719 K 7,957 K 7,948 K 12,836 K Twitter Don’t have 169 K 374 K 993 K 5/18/2012
  • 19. #2. digital presence Attract your audience. Create a desire! Increase awareness and work for long-term sales.  Tell the story  Communicate the creative idea of Prada  Convey your exclusivity  Bring up younger luxury consumers Through  The 360 –degree marketing strategy  Connection between offline and online  Using the mobile channel 5/18/2012
  • 20. #2. digital presence Make a purchase process easy! Increase sales right now.  develop e-stores (web, mobile app), focus on the well-developed and developing markets (Europe, UK, China, Japan)  offer there incomparable exclusive service And Prada become available to anyone around the world! 5/18/2012
  • 21. #3. alliances Prada for Nine West Featuring cobranded luxury goods in a fast fashion store acts as a gateway for mass market customers to enter the luxury goods arena. 5/18/2012
  • 22. Why Nine West?  Similar target audience  Focus on shoes, leader in the industry  Nine West is especially strong in advertising, digital marketing  Co-operation with large number of magazines- Easy Living, Cosmopolitan, Instyle, Glamour, Vogue etc.  According to media research Prada customers are loyal to Nine West brand* *People who like this brand also tend like other fashion brands such as Chloé, Dior, Brora, Myla and Nine West. People who like this brand tend to dislike fashion brands such as Claire's, H&M, Dorothy Perkins, Coach and Bhs.
  • 23. What is in it for us? For customers For Prada  The opportunities to try a new  Production price reduction product  Sales increase  A sense of excitement and  Coverage of the wide audience , adventure, new market group  Special Prada design with Nine  Test sales in the middle class West reliable quality audience  For Nine West fans- the prove of  Marketing resonance the brand high standards  Test E-sales 5/18/2012
  • 24. Game plan to protect the exclusivity of untouchable brand  A star launch party with performances by celebrities on the preview  Mass Media Resonance, promo in e-media  Very limited availability and only in select stores.  Short-term Sales So! „ While there is always a risk in rolling out a high-end brand in a mainstream store, it can be done right. Even if your prices have to come down to reach the masses, you can make it work by maintaining a level of exclusivity in the shopping experience. And, no matter what, always stay on brand.‟ Versace for H&M preview
  • 25. And the result surprises you… 5/18/2012
  • 26. Introducing a new form of beauty in the modern day….one that of paradoxical nature, “a girly edge, but in the end it is nasty” – Miuccia Prada Thank you. Questions? 5/18/2012
  • 27. By: Olga Dyachuk & Darya Motornova & Alexandre Ferreira 5/18/2012
  • 28. References • http://theglassmagazine.com/forum/feature.asp?tid=614#title • http://www.pradagroup.com • http://www.americascup.com/en/Teams/Luna-Rossa-Challenge-2013/The-Boats/ • http://www.cheapprada.org/blog • http://fondazioneprada.org/ • http://www.prada.com/en / • www.youtube.com • http://www.prnewswire.com/news-releases/global-luxury-retailing-market-size-brand-strategies-and- competitor-performance-134669478.html • http://www.bloomberg.com/news/2011-12-16/prada-poised-to-extend-slump-as-china-s-shoppers-cut-back- spending-retail.html • http://www.independent.co.uk/life-style/fashion/features/one-step-ahead-an-exclusive-behindthescenes-look- at-what-makes-prada-the-worlds-most-influential-fashion-label-1818812.html • http://www.internetmarketingsolution.com.au/Internet_marketing__luxury_brands.html • http://www.prnewswire.com/news-releases/global-luxury-retailing-market-size-brand-strategies-and-competitor- performance-134669478.html • http://blogs.forrester.com/sucharita_mulpuru/12-02-27-us_online_retail_hits_200b (Forester Research) • “The luxury consumer in the new digital: then & now. 2012 Report” • http://www.ninewest.co.uk/ • http://answers.google.com/answers/threadview/id/749041.html • http://www.slideshare.net/brlippert/nine-west-crative-brief • http://advertising.microsoft.com/research/luxury-lovers • “Luxury-Goods Stocks are Flying High”, MSN Money, December 20, 2010 http://www.marketingmagazine.co.uk/news/1104353/ 5/18/2012