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December 2015
Sustaining Growth in a Slowing Luxury Market
Michael Kors
Summary• Market reality --Increased competition and homogeneity• Michael Kors’ brand perception• Need promotional strategy to regain growth in revenue
Data on Market growth
Michael Kors Financial Summary
2010 2011 2012 2013 2014 2015 20160
500,000,0001,000,000,0001,500,000,0002,000,000,0002,500,000,0003,000,000,0003,500,000,0004,000,000,0004,500,000,0005,000,000,000
Michael Kors Global Revenue
MK Revenue
Year
$508M
$4.37B
2011 2012 2013 2014 2015 20160.0%
20.0%
40.0%
60.0%
80.0%
MK Rev-enueGlobal Market
Year
• Growth leveling off • Michael Kors growth
rate is slowing but is still strong at 32% in 2015
Michael Kors Growth Rate versus Global Market
$4.37M
$1.3B
Michael Kors’ Internal truth• Classic aesthetic designs with utility at a value • Staple accessories - not statement pieces• Accessible - Online, Department Stores, Independent
Retail Stores, Outlets• Versatile Product Lines - Apparel, Watches, Shoes,
Fragrances, Bags, Accessories, Leather Goods• Two brands – Luxury and Affordable luxury
“Everything for everyone” - Michael Kors
What do you think people is thinking about you
when you are wearing Michael Kors?
Basic Bitch
Customer Insights• It is everywhere - ubiquitous --“they are always on sale at some place like the Macy’s, feels like they are a little bit cheap.” --“loses value when it’s sold in stores Like Ross” --“designs always look the same”• “Status Quo” Designs • Discounts cheapen the brand
Turning Perceived Weaknesses into Strengths• It is everywhere - It’s easily available for purchase.• Status quo design - Never goes out of style. • Where do you wear Michael Kors? - “everywhere,” “work”
“The watches I wear on a daily basis.”• Discounts cheapen the brand - No need! The core customer
loves the brand! “feels more professional, more put-together, feel like I’m dressing nicer”
Desired Customer• Female 25-35• College graduate in her early career• Aspirational young professional who wants her
look to transition seamlessly from day to night• Purchase Power
Women that embody the Michael Kors customer
Kate MaraZoe SaldanaOlivia Wilde
Campaign Target Objective
• Stop decline in growth • Target $1.4B increase
in revenue over last year.
• Achievable within MK growth trajectory.
2010 2012 2014 2016 20180.0%
10.0%20.0%30.0%40.0%50.0%60.0%70.0%80.0%
MK Growth Rate (Projected)
MK Revenue
Global Market
Year
$5.76B$4.38B
So, what’s the one thing that makes Michael Kors stand above the crowd?
Michael Kors offers professional and timeless pieces that can transition from daytime office meetings to social events. A classic - yet affordable brand.
Q & A