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
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Brief outlook
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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
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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
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#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…
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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