3. EXECUTIVE
SUMMARY
As the premium highstreet sector continues to captivate
the market with its latest success of ‘pulse brands’ such
as the likes of Whistles and TopShop Unique; brands that
bridge the gap between high end fashion and high street
retail brands to create a ‘middle market’. Accessible price
points and better quality items prevail as desire for luxury
goods continues to grow within the retail offering optimum
opportunity for innovation, as a means to stand out from
the competition.
Adopting the ‘pulse brand model seems adequate for
several high street retail brands following the success of
‘Zara’s’ introducing its black label of premium priced goods;
a strategy that its largest rival Mango could also capitalise
on considering its current state.
As a brand, Mango proves to have the resources to invest in
a premium sub-brand that will allow the brand to penetrate
the market further, as well as provide an opportunity to
diversify and innovate its current brand.
After analysing Mango as a brand and its current
positioning, a proposal was constructed with the strengths
and opportunities of the brand in mind, to enable Mango
to create a new identity for itself as a brand that will appeal
to the characteristics of both premium and high street
consumers.
4. 1.INTRODUCTION
The rise of pulse brands has captivated the industry, bridging
the middle market with the luxury to create “brilliant, original
on trend pieces with the same design credentials as their high
fashion rivals.” (Britten, Gray 2014). As a new and emerging
segment, there has been an increase of interest from many
high street labels keen to incorporate a more premium aspect
to their brands, to meet rising demand and facilitate for the
noticeable change in consumer behaviour during the brink of
the recession, which saw a strong desire for pricier investment,
higher quality goods and garments.
5. For the purpose of filling the gap in the market, the Mango
brandpresentedalotofopportunitiestobeabletoincorporate
a premium sub brand, and this is due to its strong logistics
system which prioritises design and distribution, as well as its
outsourcing approach towards manufacturing that led it
to become the world’s second largest textile company. At
present,thebrandhasattemptedtoenterthepremiummarket
with its ‘Mango Premium’ brand extension, however it lacks
recognition within the market as it fails to differentiate from
its competitors, and therefore requires a change in direction.
Research was conducted using a variety of methods, utilising
both primary and secondary research to further examine
the brand, and this included conducting questionnaires,
visiting a variety of Mango stores, as well as analysing
their key competitors, distinguishing their strengths and
weaknesses as a means to identify a gap that Mango could
exploit. Online articles were a key source of information,
as well as databases such as LSN and Mintel which gave
a greater insight into the wider market. As the concept of
‘pulse brands’ remains quite new, it was therefore difficult
to find specific market information on this specific segment.
6. 2.MARKET SECTOR
2.1 MARKET SIZE AND
GROWTH
PERFORMANCE
The Premium Womenswear Sector,
inclusive of top end high street stores, is
to grow 17% to £5.5bn from 2010 to 2015.
In 2009, premium womenswear sales
were worth £4.7bn against a total
womenswear market value of £19.2bn.”
9. 2.3 KEY
PESTEL FACTORS
Technology
Technology is a crucial factor to the success of a pulse brand, as
it demonstrated by its utilisation by the likes of Topshop Unique,
and Whistles who actively use it to support its catwalk shows
and campaigns. With social media being an influential part to
modern society, it is therefore up to brands to try to build a
personalised experience for consumers by reaching out to them
on various digital platforms as “up to 35 percent of consumers
indicate that they rely on recommendations from social
networks”.(McKinsey On Marketing Sales, 2014)
Environmental
Consumers have become conscious towards all aspects of the
manufacturing process of garments and goods, and there is
demand for a more ethical approach with consumer
perspectives for brands to provide more “ecologically
unobjectionable fabrics, a
conservation-minded use of resources, reduced emission of
pollutants, greater social commitment, and fair treatment
of employees in production facilities.” Building the right
conditions to create ethical goods can be an expensive and
time-consuming method to implement however, could allow
a brand to differentiate from competitors within its market and
allow a brand to raise prices and therefore incorporate
‘premium pricing’.
10. 2.4 MARKET TRENDS
Defined as the modern age, educated, affluent
woman, this typology group is independent and
strong willed. Concerned with fitness and health
to coincide with busy lifestyles, they demand the
best, which translates in their consumption of luxury
goods and services.
“THE ATHENA WOMAN”
(LSN GLOBAL, 2013)
11. 2.5 IDENTIFYING THE
GAP IN THE MARKET
The key gap in the market would be a sub brand that
is specifically catered for the young adult, as with better
lifestyle prospects for these types of consumers, there is
demand for an edgy, quirky fashion brands that will
stand out from competitors due to key focus on design
and structure of garments and goods to appeal to the
knowledgeable, expressive consumers with a lot of
interest and knowledge of the industry. Key sources of
inspiration could be haute couture pieces recreated,
and restructured to be incorporated in day to day wear.
12. 3.THE BRAND
Mango (Punto Fa S.L) is a Spanish fast
fashion brand founded in 1984 by brothers
Isak Andic and Nahman Andic who opened
their first clothing store in Barcelona. “
Mango started
expanding in Europe in 1992 after
reaching 100 stores in its
native Spain”, and it then went on to
expand further into international
markets such as China in 2002, and the US in
2006.
13. 3.1 MISSION
STATEMENT
The successful strategy that
enabled the Mango brand to expand as
substantially as it did stemmed from the idea of
creating “fashionable products at an
affordable price, in an environment
that appeals to the consumer”. With its
mission statement being “to be
present in all cities in the world”, the brands
adoption of an “aggressive
international expansion policy” has served
them well as it “diversifies risk and reduces
dependency on the home
market.”, The brand has also adopted a
franchising strategy, allowing them
to fuel the expansion of the brand
without taking on store ownership costs.
14. 3.2 KPI’S
Revenue Forecast for
2017 – 3.27 Billion Euros
Revenue for 2013 – 1.85 Billion Euros
Profits – 120.5 Million Euros
Turnover Per Market Percentage
Home Market(Spain)– 17%
International Sales – 77.3%
Online Sales – 6.7%
17. 4. THE TARGET
MARKET
Mango’s main target market is the working
woman who is style conscious and keen to
remain up to date with the latest trends and
fashions. . Their consumer is sensitive to price and
seeks value for money as well as good quality
to formulate key staple looks for each season.
18. Name: Zoe
Age: 24
Generation:
GENERATION Y
Typologies: Athen
Woman,
New Millenials,
Social Singles
Income: 18,000 –
40,000 per annum
Life Stage: DINKY,
HEIDI
Socio-Economic
Group:
Lower Middle Class/
Skilled Working
Class
VALS: STRIVERS,
EXPERIENCERS
Motivation To Buy:
Trend-Motivated,
Celebrity Culture
20. 5.1 PEOPLE
Mango has adopted a unified business culture that
allows its employees to thrive as it utilises HR methods
such as teamwork, and continuous training as means
to maximise what is potentially its greatest asset.
The brand has implemented a structure that allows
all aspects of the workforce to give feedback on
its operations as well as suggest improvements. The
brand encourages internal promotion and its recent
global expansion is creating new job offerings in a
wide spectrum of economies.
In terms of CRM, Mango aim to reach out to their
customers by encouraging customers to sign up
when purchasing products through their website,
as this then allows the brand to email and keep
customers up to date with their latest collections
and offers.
21. 5.2 PRODUCT
CLOTHING
Dresses
Coats
Jackets
Leather
Cardigans and sweaters
Blouses and shirts
T-shirts and tops
Trousers
Jeans
Skirts
Shorts
Jumpsuits
Premium
Intimates
Sport
Essentials
ACCESSORIES
Shoes
Bags
Jewellery
Leather goods
Belts
Hats and caps
Foulards and scarves
Gloves
Sunglasses
Other accessories
22. 5.3 PRICE
In terms of pricing strategy, Mango uses a competitive
pricing method to match that of its larger key
competitor Zara. In 2013, the brand cut prices by up
to 20% across all its lines to mirror a similar strategy
implemented by Zara, and also set out to avoid discounting
and mark downs as a way of retaining profit margins.
23. 5.4 PLACE
In terms of location, MANGO has over 2,700 stores in 107
countries, with recent store openings including Tokyo and
Beijing. The brand is also attempting to take advantage of
the rising consumer spending power in Africa by opening
new branches in countries such as Ghana and Nigeria, as
it continues to exploit emerging economies.
The brand has various forms of retailing channels in the form
of:
• In store
• Website
• Mobile App
• Online Retailers ie ASOS
24. 5.5 PROMOTION
Mango is known for its use of celebrities to front seasonal
campaigns and previous candidates have included the
likes of Kate Moss, Miranda Kerr and Scarlett Johansen.
It actively focuses on brand image and uses a variety
of promotional methods such as TV advertising, online
advertising, blogger collaborations, and events such as
the Mango Fashion Awards.
25. 6. SWOT ANALYSIS
Strengths
• Strong
management system
(day to day)
• Strong brand
presence
Weaknesses
• Low market share
• All apparel designed
and sourced from Spain,
disadvantage compared
to other competitors
who can outsource for a
cheaper alternative
Opportunities
• New Technology
• Emerging Markets
• Diversification
Threats
• Competition from
larger rival Zara
• International
Competitors
26. 7.EVALUATIONOF
QUESTIONNAIRE
The questionnaire demonstrated key trends within
customers between the ages of 18-24, the first being that
this age group purchase the bulk of their clothing items
primarily on a monthly basis, however they tend to visit
stores quite regularly indicating that perhaps this age
group is more prone to impulse purchases, and likely to
save up on a short term basis to invest in pricier goods.
The key current competitors that these consumers seem
to purchase from are large scale fast fashion brands
such as Zara and H&M, with Topshop and ASOS following
closely behind, and this suggests that the middle market
is a secondary purchase source for this age group, as this
is reflected on the average amount they are willing to
spend on an outfit with the most popular category being
‘up to £100’. In terms of the most influential promotional
activities, bloggers and online recommendations seem
to be effective in encouraging purchases from these
consumers,andthemajorityalsoprefertobuykeydurable
items if they are going to spend a larger amount on them.
27.
28. I propose a sub brand targeted specifically at the 18-24
young adult segment, aiming to satisfy the truly fashion
savvy consumers in the market. Instead of copying the
designs of higher end designers, Mango should seek to
set their own and utilise their strength in design to which
currently gives them competitive advantage within the
market.Thebrandcoulddifferentiatefurtherbyappealing
toconsumerswhoaredirectlyinfluencedbycelebculture,
taking on a celebrity creative director, a similar strategy to
that implemented by Puma, who recently took Rihanna
on, sending shockwaves across the industry. As Mango
is a favourite brand amongst bloggers, an iconic brand
representative with substantial status within the fashion
industry would benefit the sub-brand as it would appeal
to the more knowledgeable fashion candidate.
mí by Mango
29. The sub brand would be compiled of key staple pieces,
incorporating unique and quirky structured designs to
appeal to the risk takers, with particular focus on outwear,
and footwear, categories in which consumers are willing
to pay more for.
30. In terms of pricing the sub brand should aim to keep its
price range between £100 to £500, as means to make the
products accessible to STRIVER’S who desire higher quality
goods without the designer price tag.
The sub brand would be placed primarily in flagship stores
in big cities such as London, making it available to wider
audiences.
31. Promotional activities for the brand would primarily be
using social media to market the collection. Events such
as the Mango fashion awards would massively benefit the
brand and help to translate the image of a higher end
designer collection, the sub brand could use the events to
showcase their collection.
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APPENDICES
