International Retail Structure of Ferragamo S.P.A

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Transcript of International Retail Structure of Ferragamo S.P.A

  • Visibilia ex invisibilibus

    FASHION & LUXURY GOODS MANAGEMENT

    CERTIFICATE PROGRAMME

    RETAIL MANAGEMENT

    MIDTERM INDIVIDUAL PROJECT Kubra Bayram

    The Brand;

    May 5th 2013

    Milan, Italy

  • Contents

    1. Abstract ........................................................................... 1

    2. Introduction ..................................................................... 1

    3. Company Profile ............................................................. 4

    4. Strategic Analysis .......................................................... 5

    5. Brand Identity ................................................................ 8

    5.1. Kapferers Brand Identity Analysis

    6. Marketing Mix ............................................................... 9

    6.1. Product

    6.2. Price

    6.3. Place

    6.4. Promotion

    7. Competitors ................................................................... 13

    7.1. Competitors and Positioning Map

    8. Experiential Marketing Strategy ................................... 15

    8.1. Schmitts Experiential Analysis

    9. Conclusion ........................................................................ 16

  • Figures FIGURE -1 : The Critical Dimensions of Luxury Retail Management ............................... 1

    FIGURE-2: 4Ps Marketing Mix ......................................................................................... 2

    FIGURE-3: Model of Buyer Behavior ................................................................................ 2

    FIGURE-4: Kapferers Brand Identity Prism ..................................................................... 4

    FIGURE-5: Ferragamo Group Revenue by Region ............................................................ 5

    FIGURE-6: Ferragamo Group Exposure in Major Markets ................................................ 6

    FIGURE-7: Salvatore Ferragamo Brand Identity Analysis according to Kapferer ............. 8

    FIGURE-8: Ferragamo Group Revenue by Product Range .............................................. 9

    FIGURE-9: Ferragamo Group Revenue by Distribution Channel ...................................... 10

    FIGURE-10: FERRAGAMO distribution network at YE 2010 ....................................... 11

    FIGURE-11: Slavatore Ferragamo warehouses worldwide .................................................11

    FIGURE-12: comparison with competitors geographic mix of revenues ...........................13

    FIGURE-13: comparison with competitors product channel mix of revenues ...................14

    FIGURE-14: key sector players and Salvatore Ferragamo positioning ...........................................14

    FIGURE-15: Salvatore Ferragamo Market Positioning Map............................................................15

  • 1. Abstract

    Salvatore Ferragamo Group S.P.A. is a significant retail based company in luxury goods market worldwide from 1927 year until now. The purpose of this project is analysing of the company strategies by focusing on the companys retail structure.

    The project framework is consists of the strategic analysis of the company which is included its target markets, socio-demographic characteristics, lifestyle, values and consumer purchasing behavior, defining brand identity of the company within the framework of Kapferers Brand Identity Analysis, explaining marketing mix strategy of the company by focusing on its distribution channel and retail structure, discussing of the companys market positioning map by comparing its competitors and finally explaining of the companys experiential marketing strategy into the framework of Scmmitts Experiential Analysis.

    In the project, we applied qualitative research methods during the data collection process which is included primarily data collection, it is consists of interviews and observations, secondly data collection is consists of literatures, articles and internet searches.

    2. Introduction

    In this section, we will give some defines related with the basic terms which is framework of the project.

    Retail Management ( source: www.managementstudyguide.com) is the various process which helps to the customers to procure the desired merchandise from the retail stores for their end user refers to retail management. We can see below shape of the main critical dimensions of luxury retail management;

    FIGURE-1: The Critical Dimensions of Luxury Retail Managament,

    Michel Chevalier, Michel Gutsatz, page: 6 1

  • We can define of target market as ( source: en.wikipedia.org ), is a group of customers that business has decided to aims its marketing efforts and ultimately its merchandise towards. A well-defined target market is the first element to a marketing strategy. The marketing mix variables of product, place ( distribution ), promotion and price are four elements of a marketing mix strategy that determine the success of a product in the marketplace.

    Consumer Buying Behavior ( Principles of marketing, Philip Kotler, 2001, page; 189 ) is the buying behavior of final consumers-individuals and households that buy goods and services for personal consumptions.

    FIGURE-2: 4Ps Marketing Mix

    Source : http://bpmktg.com/marketing-is-marketing

    FIGURE-3: Model of Buyer Behavior

    Source:http://classes.bus.oregonstate.edu/fall06/ba390/elton/CourseMaterials/kotler%206.ppt

  • We can say that the consumer characteristics are affected by three basic factors; cultural, social and finally personal factors. Culture is the most important determining factor of peoples desires and behavior achieved through socialization processes and other key facts which it includes religion, racial groups and special interests. An another one, we can defined of social factors as reference groups such as membership, aspirations and groupings, family such as religion, politics, economics and everyday purchasing behavior, social roles and statuses can be noted ingredients of social factors. And finally, personal factors which it includes age, self-concept, values, lifestyle, wealth, occupation, personality and lifecycle. Defining of market positioning is effecting to the consumer perception by marketers related with a brand, product or services within the market and creating an identity in the minds of their target audience for its products, brand or organization. On the other hand, market positioning is a distinctive aspect for a brand within the marketplace especially among its competitors. Brand Identity is a unique set of brand associations that the brand strategist aspires to create or maintain. These associations represent what the brand stands for and imply a promise to customers from organization members. (Aaker, 2002:68). We will be explaining brand identity of the company within the framework of Jean- Noel Kapferers Brand Identity Prism. According to Kapferer, brand identity prism identifies within six aspects. These six aspects are divided on two dimensions which it includes constructed source vs. the constructed receiver and externalization vs. internalization;

    a. The constructed source vs. the constructed receiver: The constructed source is represented physique and personality of the brand, on the other hand, the constructed receiver is represented reflection and self-image.

    b. Externalisation vs. Internalisation:

    A brand has a social aspect that referring to externalization which refers to physique, relationship and reflection of the brand. In addition that, the aspects that are incorporated within the brand, this is the internalization part refers to personality, culture and self-image of the brand.

    3

  • According to Kapferer, we can define to these six dimensions of the brand identity which it includes physical, personality, culture, relationship, reflection and finally self-image. We can describe of these each dimensions as physical is meaning of the physical qualities and features of the product or services, personality is the character of the brand, culture represents the set of values keeping inspiration and energy of the brand, relationship is meaning of intangible changes between the brand and its customers, reflection refers the image of the buyer, self-image is the meaning of what the brand says related with the user. Experiential Marketing is the process of engaging customers with in-depth experiences of the product or a brand. (http://www.ajbms.org/articlepdf/3ajbms2012262707.pdf). According to Bernd Schmitts experiential theory, customers experiences is explained within five experiential modules which it involves sensory experience ( sense ), affective experience ( feel ), creative cognitive experience ( think ), physical experience, behaviour and lifestyle ( act ) and finally social identity experience ( relate ).

    3. Company Profile

    The company was founded in 1927 year by talented shoemaker Salvatore Ferragamo based in Florence, Italy. Salvatore Ferragamo has been known with Italian luxury for more than three-quarters of a century and it endowed with a unique combination of heritage, creativity, glamour and exclusive Italian craftsmanship.

    The companys core product is shoes for men and women and its product range occurs footwear; le