Tutorial 4 - Elie Saab

Strategic Marketing – SUMMER SCHOOL 2014 1© Imperial College Business School

The Growth of a Luxury Brand

Tutorial 4:Elie Saab

Strategic Marketing – SUMMER SCHOOL 2014 2

• Lecture Revision– International Marketing Strategies

• Case Discussion– Luxury Fashion– Elie Saab

© Imperial College Business School

Overview for today


Glocalisation strategies

International Marketing


Glocalisation StrategyAdapting the McDonald’s service to local markets

Marketing Mix Element

Standardisation Localisation

Product Big Mac McAloo Tikka potato burger (India)

Promotion Brand name / advertising slogan ‘I’m lovin it’

Slang Macca’s (Australia)MacDo (Philipines)

Place Free standing Home delivery (India); Swiss rail dining cars

Price Big Mac is $3.10 in US and Turkey

$5.21 (Switzerland)$1.31 (China)


International marketing strategies

Waterfall approach


What does it mean to be a born global firm?

Born Global?

FEATURES?SUPPORTING

FACTORS?


What does it mean to be a born global firm?

Born Global?


Spot the odd one out…

What is a franchise?


A Great Model for ServicesTop 500 Franchises

• Using another firm’s successful business model and brand.

• Franchisor has an alternative to building chain stores to distribute goods and avoid risk / investments.

• Franchisee or operator pays a fee


View from the operators

http://www.aboutmcdonalds.com/mcd/franchising/us_franchising/why_mcdonalds/success_stories/john_ebert.html

McDonald’s Franchise Model




McDonald’s Franchise ModelRules & Regulations

• The Hamburger University (1961)• McDonald’s is one of Britain’s

biggest trainers. It gets about 1m applicants a year, accepting only one in 15, and spends £40m ($61m) a year on training.


McDonald’s Franchise ModelAd spend and brand recognition

• Restaurants spend $5.875 billion on advertising in the U.S.

• McDonald's spent $963 million in advertising in 2012, up 8.6% from the year before.

• That means $1 out of every $6 spent on restaurant advertising in America is done by McDonald's. Why?


Introduction to the CaseWhat is haute couture?

https://www.youtube.com/watch?v=4MqiHurbexE#

https://www.youtube.com/watch?v=4MqiHurbexE

https://www.youtube.com/watch?v=4MqiHurbexE


Introduction to the CaseWhat (or who) is Elie Saab?

https://www.youtube.com/watch?v=HCFwT6oUPTw




Positioning LuxuryPerceptual mapping in luxury fashion

Mass market Exclusivity

Affordability

Prestige Price

High status

Low status

ConspicuousInconspicuous


Luxury FashionPositioning and Perceptual Mapping

Mass market Exclusivity

Affordability

Prestige Price

High status

Low status

ConspicuousInconspicuous


Growth of a luxury brand


Elie Saab

Elie Saab is a Lebanese fashion designer born in Beirut in 1964. At just 9 years old, he began drawing fashion sketches, cutting patterns and sewing dresses for his sisters from his mother's tablecloths and curtains. In 1982, at 18 years old, the designer founded his eponymous couture atelier in Beirut

1982 2010


Partners

New Markets

Brand Dilution

Concerns in Summer 2010


Elie Saab

Marketing strategy for the next five years.

- Rapid growth in ready to wear (RTW) product line with 27% growth between 2006-2008

- Management dealing with challenges of selecting right partners, identifying new markets and protecting the brand from dilution

“Attract, select and maintain customers who place significance on

high end one of a kind designs”


Three pronged approach


Expansion Strategy

• Geographic: new flagship stores in select cities worldwide based on new priorities

• Increase the number of multi brand shops across the globe – from 50 to 75 within three years

• Product: Increasing the product range• RTW collection: Introducing more day wear to the RTW

collection – offering variety.• Mix luxury with affordability


In Saab’s own words…


Affordable Luxury

“You see a woman wearing a $6,000 Chanel jacket on top of a $90 pair of jeans from Zara… we have to continue to

follow the trends and needs of today’s woman to satisfy her needs and desires, whether is Haute Couture for that extra special event or the RTW for that special occasion where our customer does not have time to wait for the custom

made couture dress”

Is this a wise move?


What does the World Wealth Report indicate?


Tapping the World’s Richest


The ‘Ready to Wear ‘range


Product Categories


Affordable luxury?


Quest for Margins


Aligning strategy with marketing spend

Marketing Focus


1. Complete a SWOT Analysis (Strengths, Weaknesses, Opportunities and Threats) for Elie Saab. What do you see as the company’s key competitive advantages?


Case Study Questions


2. Should Elie Saab target a new consumer market segment? For example, should Elie Saab target the emerging “affordable luxury market”? Explain, and be ready to support your answer.




3. What are your future recommendations for Elie Saab in terms of global marketing strategies?





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Tutorial 4 - Elie Saab

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