Brand Equity, Brand Identity & Brand Strategy

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1 Heritage, Location, Knowledge, Key People BRAND/ FIRM/GROUP ECONOMIC-SOCIO-CULTURAL CONTEXT BRAND IDENTITY ( essence (brand STYLISTIC IDENTITY SEGMENTATION & POSITIONING IMAGE IDENTITY Brand Equity, Brand Identity & Brand Strategy Brand Direction Salvo Testa 1

2 Outline 1. Brand Equity & Brand Building 2. Ideal Archetypes and Brand Identities 3. Product Brands vs Lifestyle Brands 4. Brand Identity & Strategy Model 5. Brand Identity & Country of Origin Brand Direction Salvo Testa 2

3 Key Success Factors in Fashion 3 basic KSF s for Profitability and Growth in the fashion business: A strong and original Brand Identity Brand Identity & Brand Strategy Model A coherent Brand and Line Extension: Product Brand vs Lifestyle Brand A relative Control of Distribution: Multichannel Distribution Strategy (Retail DOS & Franchising, Wholesale, On line) Brand Identity, Brand Extension and Control of Distribution are strictly interrelated and imply a strong coherence: With Brand Positioning vs end customers, trade and competitors In the Contents of Strategic Choises (managerial and creative) In the implementation timing (short vs long term) Brand Direction Salvo Testa 3

4 Brand Equity: two drivers Brand awareness Perceived quality Brand associations Brand loyalty BRAND EQUITY Name, Logo Other Brand assets Provides value to consumer by enhancing consumer s: interpretation/processing of information confidence in the purchase decision use satisfaction loyalty value for money Brand Direction Salvo Testa Provides value to firm by enhancing: efficiency and effectiveness of marketing Brand loyalty Processes/Margins Brand extensions Trade leverage Competitive advantage 4

5 Brand Equity components Mix of two classes of variables: Material elements: Brand Codes (name, logo, colours, pay off, details, etc.) and Perceived Quality Immaterial elements: Brand Values and Associations in the mind of end customers, Brand Loyalty turnover branded brand equity & branded differential brand differential is price premium: customer will to pay more for a branded product vs an unbranded (ex. Licensing) Brand Direction unbranded Salvo Testa time 5

6 Ideal Strategic Archetypes A specific mission for each cluster Image Quality LUXURY BRANDS TOP DESIGNERS PREMIUM BRANDS AFFORDABLE FASHION Price MASS BASIC FAST FASHION Service Timeless Products Fashion Products Different KSF and business models Brand Direction Salvo Testa 6

7 Different Key Successful Factors IMAGE-PRODUCT LEADERSHIP ORCHESTRATE & SINCRONIZE MANUFACTURING & DISTRIBUTION COST- PRICE - DELIVERY LEADERSHIP Brand Direction Salvo Testa 7

8 Luxury Brands Exploiting and updating brand heritage Historical heritage Country of Origin (Style & Made in ) Craftmanship and tailoring Excellence of materials and workmanship Timeless stylistic codes and line extension Update of product and image Exclusivity of image and distribution (DOS Retail) Global brands (Richness & Understatement) Core products: Hard Luxury, Leather, Tailored Menswear & Luxury Sportswear, Leaders: French and Italian Brands, Swisse (Watches) Brand Direction Salvo Testa 8

9 Hermes: Luxury Retail Model Brand Direction Salvo Testa 9

10 Top Designers Creating and imposing new trends/styles Brand personality (designer & creative director) Non-stop innovation in style and image Exploiting manufacturing excellence (Black lines) Horizontal and vertical brand and line extention: (total look, young lines, endorsed brand) Brand exploitation (licensing for medium and mass lines and products) High control on distribution (DOS Retail) High investments on image (adv, celebrities, web) Global Brands (Trendsetting & Ostentation) Core products: Women Ready to Wear, Leather Accessories Leaders: Historical & New Fashion Designer, Luxury-Fashion Brand Brand Direction Salvo Testa 10

11 Prada: Strategic Guidelines Brand Direction Salvo Testa 11

12 Affordable Fashion Industrializing new fashion styles High fashion democratization (follower) Quick industrialization of fashion High ratio quality+fashion/price Exploting quality and flexibility of fashion pipeline (Made in Italy) Partnership between top designer and industrial & commercial companies (licencing and franchising agreements) Fashion revitalization of basic products (jeanswear, accessories) and emerging of new market-product segments Core products: Apparel, Leather Accessories Leaders: Diffusion lines, jeanswear & accessories, Premium Fast Fashion Brand Direction Salvo Testa 12

13 Premium Brands Balancing Quality/ Style and Service/Price Democratization of luxury on medium end or top end brands for intrinsic no-luxury goods (sportswear) Lifestyle brands to support brand extensions Add value in brand awareness and retail Strong service to trade (basic product noos, replenishment, deliveries) Strong supply chain and global sourcing to exploit economies of scale and low cost opportunities High investments in image (marketing oriented) to support sell out on an intensive distribution Core products: Menswear (formal & sportswear), Leather Accessories Leaders: Industrial Brand in Menswear Sportswear, Premium Jeanswear Brand Direction Salvo Testa 13

14 Mass Basic Standardizing products service and price Democratizing clothing & accessories for mass Extreme exploitation of economies of scale and international sourcing in low-cost countries Best service to trade and end user (make to stock, noos products, continuous replenishment) Global retail formats and Iconic products Strong integration among distribution/retail, design/style and supply chain on a global scale (Quick response) High investment on marketing (retail & brand) Core products: Casual & Jeanswear, Activewear, Underwear Competitor: Mass Brand & Mass Retailer USA, EU, ASIA Brand Direction Salvo Testa 14

15 A&F: Retail Experience & ADV Brand Direction Salvo Testa 15

16 A&F: Mass Brand Retail Model Brand Direction Salvo Testa Av. Sales Stores: 4 mill $ 16

17 Fast Fashion Standardizing fashion products Democratizing fashion on mass market Exploiting proximity to trend makers (top designers) and fashion pipelines (materials) Flexibility and speed to deliver fashion products at affordable price, by leveraging on economies of scale Lean and close supply chain (Europe, North Africa) Strong integration between product design, retail and supply chain (mainly retailers) Core products: Womens formal & sportwear, Accessories Competitor: Zara, Mango, Desigual, H&M, Uniqlo (Mainly Retailers) Brand Direction Salvo Testa 17

18 Inditex: Fast Fashion Retail Model MULTI-BRAND, MULTI-FORMAT, GLOBAL Av. Sales Stores: 2,3 mill Brand Direction Salvo Testa 18

19 Inditex: Customer driven Brand Direction Salvo Testa 19

20 Inditex: Premium Retail experience Brand Direction Salvo Testa 20

21 Product vs Lifestyle Brand Values, Aspirational World Relation associated values (rational & emotional) Guarantee reliance & loyalty Moncler, Belstaff, Fred Perry, Car Shoe ICONIC BRAND Product concept Benefits, Guarantees GUARANTEE BRAND LIFESTYLE BRAND A world, a set of values Designer & Luxury, Nike, Diesel, Timberland, Abercrombie Benefits to customer Product Attributes PRODUCT BRAND Max Mara, Zegna, Tod s, Hugo Boss, Coach, Zara, H&M identification informative effectiveness & efficiency Phisycal products Brooks Bros, Levi s, Lacoste, Woolrich, Brand Direction Salvo Testa 21

22 Brand identity & Strategy Heritage, Location, Knowledge, Key People BRAND/FIRM/GROUP ECONOMIC-SOCIO-CULTURAL CONTEXT BRAND IDENTITY ( essence (brand STYLISTIC IDENTITY SEGMENTATION & POSITIONING IMAGE IDENTITY LONG TERM PRODUCT STRATEGY - range: product mix - pricing: core/entry/top/ - service: delivery/noos RETAIL IDENTITY & DISTRIBUTON STRATEGY - channels (direct, indirect) - formats & location - store concept & visual COMMUNICATION STRATEGY - target, media, tools - contents, testimonials SHORT TERM Brand Direction Salvo Testa 22

23 Stylistic Codes and Seasonal Themes Stylistic permanent codes (Brand feature): Product concept: es. Tod s driving shoe, Fay/Bostonian Jacket, Timberland Boot Shape-Model: Kelly Bag, Vara, Levis 501 Material: Nylon Zainetto Prada, Monogram Canvas LV, Fur Fendi Drawing/Finishing: animal printing Cavalli or Ferragamo Details: Red sole (Louboutin), Stitch (Max Mara) Logo: H Hermes, H Hogan, Swoosh Nike Color: Red Valentino, Green Benetton, Greige Armani Stylistic seasonal themes: is a concept of color/atmosphere/ inspiration, related to a specific season; Product mix: repeat and renovated product (Brand Stylistic codes) and fashion/seasonal product (seasonal themes) Brand Direction Salvo Testa 23

24 Stylistic Codes Brand Direction Salvo Testa 24

25 Image codes and visual identity Brand Name Lettering Logo Colours Packaging Advertising Events Celebrities Press release Brand Direction Salvo Testa 25

26 Brands and Distribution Channels Differentiation among geographic markets USA-ASIA NORTH EUROPE SOUTH EUROPE Monobrand Stores HIGH END Dept Stores & Specialty Stores Top Independent Stores MEDIUM END Franchising Independent Store LOW END Mass Retailer & Mega Brand Fast Retailer Brand Direction Salvo Testa 26 26

27 Key Retailers on Main Countries Italy: Mono & Multibrand Top Boutiques (Best Stores: Biffi, Gio Moretti, Tessabit, San Carlo, Penelope, Le Noir, Spinnaker, Anna Mode, LuisaViaRoma, Ratti, Russo, De Fano, Giglio, ecc.), Department Stores (Excelsior, La Rinascente, Coin), Franchising Chains (Benetton, Calzedonia, Intimissimi, Pinko, Patrizia Pepe, Liu Jo, Carpisa) UK: Department Stores (Harrod s, House of Fraser, Selfridges, Marks & Spencer, Debenhams, Liberty), On line Retailers France: Monobrand Stores (Paris, South), Department Stores (Bon Marchè, Printemps, Gallerie Lafayette), Specialized Chains (Decathlon), On line Retailers Spain: Fast Retailers (Zara, Massimo Dutti, Mango, Desigual), Department Stores (El Corte Ingles) Germany: Franchising Chains (Intersport), Specialized Chains Deichmann, Tenaris), Department Stores (Karstadt), International Chains (Zara, Bata, H&M) USA: Department Stores (Neiman Marcus, Bergdorf & Goodman, Saks, Nordstrom, Macy s), Brand Chains (Ralph Lauren, Abercrombie), Outlet, On line (Target), Specialty stores Asia & Russia: Department stores, Shopping Centers, Monobrand stores Brand Direction Salvo Testa 27 27

28 Evolution of retail formats Creation of Lifestyle Flagship stores (brand loyalty): Gucci, LV, Chanel, Prada, Ralph Lauren Different location formats (City, Resort, Travel Related): Prada Epicenters, Villebrequin Resort Stores Mono-category stores : Armani, Dolce & Gabbana, Prada (accessories, home, sportswear) Franchising format (new markets): Bulgari, Gucci, Celine, Dior Selective distribution for duty-free corners Brand Direction Salvo Testa 28 28

29 Retail identity Distribution channels Retail formats Locations Store concepts Layouts and displays Shop windows Visual merchandising Store assistants Store events Brand Direction Salvo Testa 29

30 TIMELESS EXCLUSIVITY, EASY CHIC Saddler Family (6 gen.), France, Paris ORANGE, LEATHER, CRAFT DETAILS, CIRCUS, HORSES, SILK, H ARISTOCRATIC CONTEMPORARY ARTISANS CLASSIC LUXURY ATELIER TRAVEL, HORSE WORLD, DREAM ATMOSPHERE Brand Direction Salvo Testa 30

31 Giorgio Armani, Buyer Rinascente, Menswear Designer Manager Woman (Athena Goddess), Metropolitan, Contemporary FUNCTIONAL & CONTEMPORARY ELEGANCE blazer, greige, loose- fitting/ tailored details Essential design Movies, 50, black & white, eagle (EA) Brand Direction Salvo Testa 31

32 Paris, Coco Chanel, Emancipated Woman, Cultured and Sporting Timeless Women, no age, elegant, sporting, cosmopolitan BON TON, CHIC, ALLURE Classic colours (black, white, beige) tailleur, tweed, jersey, chains, camelia, N. 5 Atelier Stores Celebrities, Nicole Kidman, Carolina & Charlotte Monaco Princesses Brand Direction Salvo Testa 32

33 Milano, Miuccia, classicity & innovation, Vintage, Modern Art Cosmopolitan women & men, conceptual & understated, for daily occasions ITALIAN MODERN CHIC Qualità, tradizione, innovazione Chic, easy, severity, functionality, acid colours, leather, nylon, innovation, fun Multiformat stores, Epicenters, Genius Loci, Visual Evocative atmosphere, sophisticated women, surprise and provocation Brand Direction Salvo Testa 33

34 Brand Identity, CoI & CoMI Country Identity CoI Country/Place of Inspiration CoMI Country/Place of Made In Brand Identity Brand Direction Salvo Testa 34

35 Identity, values, Country Legitimacy FRANCE USA ITALY ENGLAND SOCIO- CULTURAL AND LOCAL VALUES Tradition Elitarism Luxury Arts & Culture Melting pot Self-fulfilment Democracy Contemporary Passion Craftmanship Culture Landscape Tradition Innovation Isolation Ethics PRODUCT IDENTITY (Design) Exclusivity Quality Eccentricity Leisure Functionality Convenience Style/Design Quality/Price Details Classic & Twist Sport Chic Functionality LEGITIMACY PRODUCT CAT (Made In) IMAGE IDENTITY (Lifestyle) Haute-couture Leather Silk Fragrances Sofistication Arrogance Provocation Jeanswear Casualwear Sportswear Active wear Freshness Affordability Sobriety Pret-a-porter Leather, Shoes Fabrics, Silk Jewelley, Glasses Taste Sensuality Quality of Life Fabrics Menswear Coats, Trench Knitwear Contrast Heritage/Cool Ethics Brand Direction Salvo Testa 35

36 French values and culture Tradition and elitarism Social values Couture, accessories, fragrances product Sofistication and provocation image Brand Direction Salvo Testa 36

37 Dior: heritage, provocation, image Show off and new rich people Luxurious and excessive Couture, accessories, perfumes Trash Princesses Brand Direction Salvo Testa 37 Salvo Testa

38 American culture and lifestyle Democracy and self-fulfilment Social values Jeanswear, sportswear, active product Freshness, affordability, sobriety image Brand Direction Salvo Testa 38

39 Ralph Lauren: American lifestyle WASP American Dream New England + American Natives Country style and classicity Polo iconic product Total living Globalization Brand Direction Salvo Testa 39 Brand Identity e COR

40 Italian values and culture Passion, craftmanship, culture Social values P-a-p, leather, shoes, jewellery product Taste, sensuality, quality of life image Beautiful and well done for total living Brand Direction Salvo Testa 40

41 Dolce & Gabbana: a sicilian story Neorealism and mediterranean seduction Mixing couture, fashion, rock Tailor and craft details with a modern reinterpretationati, couture jeans Celebrities, pop stars, show-off Brand Direction Salvo Testa 41

42 CoI e CoMI of Italian Brands 11 GENIUS LOCI BRAND 7 GENERIC CoOR BRAND 4 NO CoOR BRAND Brand Direction Salvo Testa 42

43 CoI and CoMI of International Brands 11 GENIUS LOCI BRAND 11 GENERIC CoOR BRAND 4 NO CoOR BRAND Brand Direction Salvo Testa 43

44 Genius Loci Brand Country Identity CoI Country/Place of Inspiration CoMI Country/Place of Made In Brand Identity Brand Direction Salvo Testa 44

45 Genius Loci Brand Brand Direction Salvo Testa 45

46 Generic Country of Origin Brand Country Identity CoI Country/Place of Inspiration CoMI Country/Place of Made In Brand Identity Brand Direction Salvo Testa 46

47 Generic Country of Origin Brand Brand Direction Salvo Testa 47

48 No Country of Origin Brand Country Identity CoI Country/Place of Inspiration CoMI Country/Place of Made In Brand Identity Brand Direction Salvo Testa 48

49 No Country of Origin Brand Brand Direction Salvo Testa 49

50 New Trends: re-allignment CoI + CoMI Authenticity, Exclusivity, Ethics, Value CoI Country/Place of Inspiration CoMI Country/Place of Made In Brand Identity Brand Direction Salvo Testa 50

51 SHANG XIA: Styled & Made in China Brand Direction Salvo Testa 51

52 Prada Milano: Made in World Interlaced-India Denim-Japan Tartan-Scotland Alpaca-Peru Brand Direction Salvo Testa 52

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