TOMMY HILFIGER Brand Marketing Audit
1
CONTENTS
2
1.0
Executive Summary 2.0
Introduction 2.1 Time line 2.2 Brand History
3.0
Brand Equity 3.1 Primary Research 3.2 Aaker’s Model
4.0
Marketing Mix 4.1 BCG Matrix 4.2 4 P’s 4.3 AIDA Model
6.0
Competitor Analysis
6.1 Brand Positioning Map
7.0
PESTEL
7.1 Political 7.2 Economic 7.3 Social 7.4 Technological 7.5 Environmental 7.6 Legal
8.0
SWOT Analysis 9.0
Recommendations 10.0
Bibliography
5.0
Consumer Segmentation 5.1 Maslow’s Hierarchy 5.2 Consumer Profile
3
4
1.0 EXECUTIVE SUMMARY After reclaiming his confident, reliable and youthful brand, his popularity and success soared after selling the Tommy Hilfiger corporation In May 2010. His company sold for $3 billion to the clothing conglomerate, Phillips-Van Heusen. It's now yet again recognised worldwide for it's Classic American Cool Style. The purpose of my report is to analyse one of the world's leading designer lifestyle brands. Not only this, but it'll allow you to get a refined understanding of how a modern and successful brand is kept alive in the competitive industry today.
5
2.1 TIME LINE 1992
1997
Tommy Hilfiger Corporation went public.
1996
Women’s clothing range was introduced.
6
2001
Tommy opened his first official store in Beverly Hills.
Tommy launched his first women’s ‘intimate’ apparel.
1998
This was then followed by another store opening located in London.
2004
Tommy released the ‘True Star’ fragrance. The campaign featured Beyonce as their ‘poster girl.’
2016
2017
Tommy announced his latest collaboration with the famous Icon, Gigi Hadid.
2017
Tommy announces his collaboration with the The Chainsmokers.
2017
The Tommy Hilfiger Corporation released their Tommy Jeans Collection.
Vetements and Tommy Hilfiger begin their collaboration together.
2017
Tommy Hilfiger collaborates with Rossignol, the Skii apparel brand.
7
Born in Elmira, New York in 1951. From a very young age Tommy dreamed of “cars, sports, girls; of making money, enjoying life and being a rockstar.” Evidently he was set in his mind with just the amount of success he wanted to indulge himself in. He was the prime example of an American Dreamer. As much to his father’s dismay, at the age of 18 along with his closest friends Tommy opened a store People’s Place. Their strategic approach along with their creative ambitions enabled their store to become a huge success from the get go, and as the whole process continued Tommy became recognised. In 1985 a business man, Maohan Murjani, helped Tommy launch his own collection and later that year they launched a successful marketing campaign in New York Times Square. As you can see from the image it was a large billboard that stated he was amongst the 4 greatest designers. Fast forward 7 years, Tommy began designing clothes for musicians. Including Snoop Dogg. He then proceeded to sponsor tours and music concerts. In fact, in 1999 he became Britney Spears’ main sponsor for her ‘Baby One More Time’ tour. Looking back at his childhood he was evidently moved by the music industry. As I mentioned before he dreamed of being a “Rockstar.” So for Tommy to collaborate and make a name through celebrity endorsement, just goes to show he achieved what he wanted and more.
Tommy’s original product offer was classic American Cool style. It seems he was “Inspired by iconic pop culture and Americana heritage” “he was driven by an ever-optimistic vision to break conventions and celebrate individuality.” (Hilfiger) Unfortunately, in 2000 Tommy’s sales declined by about 75%, and his success began to fall. It seems he stuck with his red, white and blue colour scheme for too long. Consumers just didn’t have an appetite for his collections. Stores started to discount his products which made the value of his brand fall even more. Along with this his wife wanted a divorce, Tommy had Hepatitis, his partners were leaving and his brother Billy passed away due to a brain tumour. It’s evident the early 2000’s didn’t favour the Hilfiger’s.
8
In the year 2006 he sold his company for $1.6 billion to Apax partners investment company. The following year he signed a contract to sell his products exclusively in ‘Macy’s. It seems the two brands were working together to plan new ventures and brand extensions. Moving on from this, in 2010 the Tommy Hilfiger Corporation was purchased by Phillips-Van Heusen. Tommy stayed on as principle designer and with the variety of collections, collaborations and celebrity endorsements their success bloomed. One of Tommy’s latest collaborations would feature the up and coming brand, Vetements. Together they’ve produced unisex items which include hoodies, T-shirts, beanies and socks. Tommy Hilfiger has also collaborated with the likes of Gigi Hadid and The Chainsmokers. They’ve also used celebrities such as Lucky Blue Smith, Sofia Riche and Cameron Dallas to model for their campaigns. These strategies are very successful due to their large followings on their social media platforms. Their success has enabled them to add extensions to their brands. For example they don’t only sell premium lifestyle clothing but they’ve introduced products such as: Swimwear, Footwear, Sportswear, Eyewear and even Home Furnishings. The demand for ‘Tommy’ products has rapidly increased over the past decade.
2.2 BRAND HISTORY
9
3.1
PRIMARY RESEARCH
I decided to venture out and create my own opinion on the brand. I visited House Of Fraser in Meadowhall, Sheffield. All that was stocked was their male clothing range. The overall display of the department was stylish and neat. It was evidently organised in a way in which customers could find what they wanted easily. Along with this there were sales in store so an example of their discount would include a reduced black puffer coat which started at £190 and was reduced to £133. When it came to testing the quality of the clothing I was overly pleased with what was presented however, for me I wouldn’t personally pay the price. Other than that I was pleased with the overall visit to the department. Finally I decided to ask the employee what packaging is used when the customer buys a product. I expected there would’ve been a substantial bag or box as the brand is “one of the world’s leading designer lifestyle brands” Unfortunately, it seems all that’s supplied is a plastic, standard, House Of Fraser bag. She then went on to explain that they gift wrap over the Christmas period but only then. For me this was the only let down. Considering the amount they expect us to pay for the products that are then shoved in a plastic bag. This isn’t how I imagined ‘luxury fashion’ should be handled. (Hilfiger) Moving on I decided to pop into Urban Outfitters. On their website they supply Tommy Hilfiger so I wanted to see if they stocked it in store. To my surprise they did. Although the display was rather messy I wasn’t overly fussed as it was a urban retail store and it was nearing closing time. They stocked the male Tommy Jeans collection, which was again rather unisex. They ranged from £80 jumpers to £190 wind breaker jacket. Although this is rather expensive, Urban Outfitters offers student discounts starting at 10%. Making the stock more appealing and available to customers. Reflecting on both stores it was clear that what I was consuming was Tommy Hilfiger. The colours and designs were a significant style and along with this there was a definite classic American feel to the whole experience.
10
3.2
AAKER'S
The Aaker’s model views brand equity as a combination of factors. These include: perceived value, brand awareness, perceived quality, brand associations and other proprietary brand assets. It seems that brand equity develops and grows as a result of the consumers experiences with the brand. In this situation I’ll be referring Tommy Hilfiger to the model and giving examples to back up my points.
inspired by American classics with a twist of a modern touch. Not only that, but to help publicise the collection Sofia Riche and Lucky Blue Smith are predominant models for the campaign.
To start I’ll begin with perceived value. One example that demonstrates Tommy Hilfiger’s dedication to his consumers would include his #TommyFall14 show. From the Tommy Hilfiger fan website they were able to recognise their most loyal fans, and present them with an invitation to the fashion show. Not only has this marketing strategy boosted their presence on social media platforms, but it has also enhanced their brands awareness by promoting and providing access for all of their brands consumers and followers. Another example of their loyalty would include his Autumn/Winter 16 show which was staged at New York’s Pier-16. In preparation for this, he invited a large amount of ‘non-industry professionals’ to attend. At this specific show it featured “rides, temporary tattoo booths, and cotton candy machines.” (Stansfield, 2016) This level of creativity allows room for interactivity, and gives the ‘nonindustry professionals’ a chance to experience something new. Not only did he create a fashion show, but he made it an experience never to be forgotten. Tommy Hilfiger introduced his new strategic buying process at this show. This meant that the consumers could buy the collection right off the runway. They call it “See Now, Buy Now.” This process was so seamless that “Traffic to tommy.com increased by 900 percent in the first 48 hours. Multiple styles sold out in 24 hours after the September show and sales grew by double digits across the women’s category, with the highest gains in the United States, Japan and China.” (Paton, 2017) Moving on to ‘Brand Awareness’ it seems there is a clear sense of consistency within the brand. This helps create the feeling of familiarity and comfort. The brand itself has a strong association with the ‘American dream.’ I assume this mainly originates from it’s continuous use of the signature colours Red, White and Blue. Along with this, in previous advertisements there’s a receptive use of smiling Americans featured in preppy clean shirts. The models are also featured pictured together playing happy families in their neatly styled blazers. Contrasting to this, Tommy introduced a new line in 2017. ‘Tommy Jeans.’ Every piece in the collection adds flavour and a pop of colour. It was
In relation to Perceived quality Tommy Hilfiger is a very accessible brand. Their customers can have immediate access to their online website. Consumers can also purchase Tommy Hilfiger in stores such as: John Lewis, Selfridges, Urban Outfitters, House Of Fraser and many more. Along with all this, Tommy Hilfiger has over 1,400 stores in over 90 countries. Not only does he sell premium lifestyle clothing, but he’s branched out and given the public a larger product portfolio in which they can buy from. This means that along with his variety of clothing ranges, consumers can purchase: Swimwear, Footwear, Sportswear, Eyewear, Denim, Accessories, Fragrances, Watches, Home Furnishings and Tailored Clothing. This variety allows the brand to become more diverse in relation to suiting to consumer interests and preferences. Moving onto Brand associations, it seems Tommy Hilfiger never fails in keeping his consumers in the know. The brand regularly posts on their social media platforms, and to get a better understanding their influence, their twitter has over 1.5 million followers, where as their Instagram features 6.3 million. Along with being shown images from photoshoots we also have access to interviews with the models, behind the scenes clips and runway highlights. Lastly, when it comes to the final factor of the other proprietary brand assets, it seems the brand has always had the Hip-Hop Music culture on it’s side. From the beginning of Tommy Hilfiger’s career, he sponsored many tours including big celebrities such as The Rolling Stones and Britney Spears. So from very early on, the hip hop culture has really boosted his reputation and success. Moving onto the modern day, it seems artists such as A$AP Rocky, Zendaya, Bruno Mars, Drake, Nicki Minaij, Rihanna and many more have been featured wearing his collections. Not only is this a form of advertisement, but it just goes to show how the industry respects the brand itself.
11
4.1 Hilfiger’s brand went from being high end to stand still.
4.0 MARKETING MIX
It seems the negative connotations associated with the brand, along with lack of fresh ideas reduced overall sales which lead it’s market growth to decline. Moving onto the present day, it’s under new management and the image of the brand, along with the current success, has therefore increased their market growth in response to this. Relating the ‘Tommy Hilfiger’ brand to the BCG Matrix theory, it seems I would allocate their Tommy Jeans collection to the ‘Stars’ category. There is rapid growth and it fulfils a dominant market share. With the collection featuring in various department stores, and online websites, they’re influencing quite a large portion of the retail fashion industry. In contrast to this, I would allocate their TommyXGigi collection to the ‘Question Mark’ category. Although it’s a popular collaboration, It’s still quite fresh. So for them to maintain their success, they should continue to collaborate with new models and trends, which should increase their market growth, and hopefully increase their market shares.
4.2 I’ll be looking at the 4 main factors organisations use to satisfy needs. This will be used in relation to my given brand. Tommy Hilfiger. Product: Tommy Hilfiger offers a variety of different products which reach out to a vast amount of consumers. Tommy Jeans is reinventing the 90’s. It’s the perfect brand for individuals who are urban and embody an edgy side. This label is fitting to the 18-30 year old category. Tommy Tailored is suiting to the mature male population. It’s sharp, fresh and sophisticated. Their Sustainable Evolution is fitting for those whom are happy to spend more, and be environmentally friendly at the same time. The TOMMYXGIGI collection aims for the younger female audience who are possibly followers of Gigi herself. Their core line Tommy Hilfiger represents the classic cool American style, which is mainly aimed at the 25-40 year old consumers. Along with all these separate lines we have access to different products. Some examples being: Eyewear, Footwear, Fragrances, Children’s wear and Accessories. Price: Their Prices vary between their products being sold. When I visited a Tommy Hilfiger department in the store: House Of Fraser there were discounts on of up to 50%. Not only that but on online stores such as Asos, students are eligible for up to 10% off. These discounts make their brand more available to those who perhaps aren’t big spenders but want the labels. When doing primary research I realised how pricey some of their products are. In their male department there were coats starting at £200, T-shirts starting from £25 and jeans starting from £70. Promotion: Tommy Hilfiger uses a continuous marketing strategy which overall creates a higher visual profile for the brand. They regularly post on social media platforms, advertise in Magazines and on Billboards. With their use of celebrity endorsement this gives a higher recognition from the public. One unique strategy that they used in 2015 was a virtual reality experience in select stores worldwide. The immersive technique allowed shoppers to ‘sit’ front row at their Manhattan Fall 2015 runway show. Not only that but the virtual experience allowed shoppers have an exclusive sneak peek backstage, this isn’t normally accessible by anyone other than those involved in the show. Place: There are over 1,400 stores in over 90 countries. This includes their flagship stores. Some of their prime locations would include; London, New York, Paris, Tokyo and Düsseldorf. Consumers also have access to Tommy Hilfiger in shops such as: Urban Outfitters, Asos, Selfridges and House Of Fraser. Not only does this allow the brand to become more accessible but it gives the consumers more opportunities for discounts and sales. It’s evident they’re targeting a younger generation with a disposable income. Along with these different opportunities, they give us the opportunity to comment and suggest areas in which you feel would be successful to them to open more stores. This interactive strategy can be found on their website.
12
13
4.3
14
15
16
5.1 MASLOW’S HIERARCHY Relating the Maslow’s Hierarchy of needs model to the Tommy Hilfiger brand, I felt that two collections in particular would fit. To begin, I felt for the ‘Self Esteem’ section it would relate to the TOMMYXGIGI collection. When consumers wear her designs, it could potentially form a sense of respect and along with this boost their self esteem. It almost reassures them that if the model herself can design and proceed to wear the collection, which is then made available to the public, it would massively influence their purchase. Moving onto my final point, I felt that the Tommy Jeans collection relates perfectly to the ‘Self Actualisation’ section. The collection itself is colourful, diverse and youthful, and the consumers buying into the brand want to create a flavour of their own within the clothing their wearing. The collection embodies street culture, and allows one to be expressive. At this stage of the model it’s apparent that what the consumers are buying into isn’t essential, however they’re fulfilled with a strong urge and need, leading them to purchase the goods.
ONSUMER SEGMENTATION 17
TOMMY JEANS CONSUMER PROFILE 18
• • • • • • •
18-25 Medium Disposable Income Works In Creative Industries Fashion Forward Dresses To Make A Statement Colourful And Careless Inspired By The 90’s
5.2 CONSUMER PROFILE
19
20
6.1 BRAND POSITIONING MAP
When it came to creating the brand positioning map I decided to include all possible competitors of Tommy Hilfiger. Even if that meant including everyday retail stores such as H&M. In an interview, Tommy himself explained how “Ralph Lauren, Giorgio Armani, Calvin Klein—are big businesses that, I have to contend with” So it was inevitable they’d be added to the map. Other brands that feature would include: Fila, Adidas, Nike, Levi’s and the list continues. I found that with the ‘sportier’ brands they’d be in competition with the Tommy Jeans Collection. It’s urban and quirky, which I feel we can see has been embodied in brands similar to Fila. Moving onto brands similar to Calvin Klein, I feel they’re predominant competitors when it comes to their Hilfiger Collection. They’re similarly a luxury lifestyle American brand however, I feel Tommy Hilfiger has distinct characteristics in which consumers can identify it’s products from competitors. (CNBC,2012)
21
22
23
7.1 POLITICAL
7.2 ECONOMIC
In 2017 the Tommy Hilfiger Corporation decided to make subtle political statement in their runway show. The models were featured wearing white bandanas on their wrists. This movement was “to make a clear statement in support of human unity and inclusiveness amidst growing uncertainty and a dangerous narrative peddling division.” It’s apparent that the “bandana campaign came at a time when the battle lines were being drawn in business over Donald Trump’s presidency.” It’s been said that Tommy Hilfiger dodged the subject when asked but stated he’s “just focused on what we’re trying to do with our brand, which is disrupt.” (McColgin, 2017)
24
When Britain’s vote to leave the EU was confirmed the pound “plummeted to lowest level against the dollar in 31 years and more than $2 trillion was wiped off the global stock market in reaction to the shocking referendum result.” It’s thought that many fashion brands will struggle with the change. It’s expected to cause trading complications as agreements will have to be formed which follow the guidelines of the World Trade Organisation rules. Along with this it’s been said that “recruiting and retaining talent may become more challenging.” However, at the end of the day “what Brexit will mean for a business is unknown.” (Hoang, 2017)
7.3 SOCIAL The Tommy Hilfiger Corporation has a strong recognition and consumer base.The brand has an active online presence and along with this they have stores in more than 90 countries. Tommy Hilfiger has many social influencers and some include: The Chainsmokers, Drake and A$AP Rocky. By Celebrities making appearances in public wearing the couture, it allows fresh eyes to see the brand, therefore introducing a new target demographic. In 2016 the pop icon, Bruno Mars appeared on the MTV EMA’s wearing a Tommy Jeans Hoodie. It seems the show managed to rank in 6.5 million viewers on the night, furthering the name of the Tommy Hilfiger brand.
7.4 TECHNOLOGICAL In relation to Tommy Hilfiger, it seems they’ve become one of the most accessible brands. With their introduction of the ‘See Now, Buy Now’ model consumers are able to buy the latest collection straight off the runway. Tommy’s vision ”for TommyNow was to create a global platform that we could take on tour to bring our show experience to new audiences around the world,” he believes “It’s about the fusion of fashion, entertainment and pop culture with experiences, performances and inspiring interactions that are designed around our consumers.” (Brannigan, 2017)
7.5 ENVIRONMENTAL
7.6 LEGAL
Following Tommy Hilfiger’s fairground fashion show in 2016, the brand was facing a ‘legal action’ from the American Brand ‘GIGI.’ It seems the leather goods label, Gigi New York, wasn’t impressed with the release of their collaboration as they felt “Tommy Hilfiger had copied” them “causing additional consumer confusion.” Apparently the handbag brand has had “law property rights since 2010 owns federal trademarks for their ‘GIGI’ family of marks.” (Berrington, 2016)
For this section I decided to refer it to the current sustainable choices made by the Tommy Hilfiger Corporation. They’re members of various societies and establishments. Some examples would include: their membership with the Better Cotton Initiative, they’re members of the Leather Working Group, along with this they’ve also formed a multiyear partnership with WWF, they’ve joined the Zero Discharge of Hazardous Chemicals program, and the list continues. These connections help make a positive name for the brand and can potentially introduce a new group of consumers.
25
S
26
W O
T8.0
STRENGHTS • • • • • • • • • • •
Celebrity endorsements. Strong online presence. Well established brand. Consistent colours makes them recognisable. Very broad demographic with all the alternate collections. Ramadan collection-makes the brand even more accessible. “See Now, Buy Now” instead of waiting 6 months they’re more accessible from straight off the runway. Active social media presence. Presence in over 90 countries with more than 1,400 stores. Clear vision with their demographics. Making sustainable approaches to all elements in their operations.
WEAKNESSES • •
OPPORTUNITIES • • • •
They’re becoming more sustainable. Opening new markets-collaboration with Rossignol. Collaboration with Vetements opens to a new market. In releation to Maslow’s heirarchy of needs in the sense of belonging they’re members of different organisations e.g WWF, FSC, Better Cotton Initiative and the list continues. This gives them a sense of connection and attracts to a different audience if they’re being environmentally friendly and creating bonds/connections.
Brand protection and maintenance cost is high when there’s a change in the economy. Possibility of becoming too familiar with the repetitive colours.
THREATS • • • •
Intense competition from international brands. Constantly changing fashion trends means inventory issues. Economic slow down will cause reduction in demand for premium priced products. A solution from my perspective would be that if they continue to collaborate with younger, urban, Icons they’ll help regenerate the brand.
27
10.0 RECOMMENDATIONS
28
For me I feel that Tommy Hilfiger is a recognised and successful brand. There isn’t much I can say for them to develop on, or for them to reposition themselves within a new market, simply because the brand is extremely broad in the sense that each individual collection reaches a different demographic. One thing I would suggest is to create a maternity range. Their adverts present images of smiling Americans playing happy families so what’s the harm in creating a range for the women who let that happen? I also feel they can continue to push further with their online presence by going the extra mile. Perhaps having live videos from behind the scenes, or even allowing the public to do Q&A’ s with their celebrity ambassadors. I feel this immediacy and interactivity will create a stronger bond with their consumers, and perhaps introduce an even younger, fresher and active audience.
29
30
10.0 BIBLIOGRAPHY Tommy Hilfiger ‘Biography’ Retrieved from: http://global.tommy.com/int/en/about/ biography/12 Ted Stansfield (2016) ‘Gigi and Tommy take fashion to the funfair’ Retrieved from: http:// www.dazeddigital.com/fashion/article/32773/1/gigi-hadid-and-tommy-hilfiger-take-fashion-tothe-funfair-aw16-new-york Elizabeth Paton (2017) ’Fashion Shows Adopted A See-Now, Buy-Now Model. Has It Worked?’ Retrieved From: https://www.nytimes.com/2017/02/07/fashion/see-now-buy-nowbusiness-fashion-week.html CNBC (2012) ‘I AM AMERICAN BUSINESS’ Retrieved from: https://www.cnbc.com/ id/100000553 Carol McColgin (2017) ‘White Bandanas Make Political Statement on the Tommy Hilfiger Runway’ Retrieved from: https://www.hollywoodreporter.com/news/tommy-hilfiger-runwaywhite-bandanas-make-political-statement-973850 Limei Hoang (2017) ‘The Great British Break-Up: How Brexit Will Impact Fashion in 2017’ Retrieved from: https://www.businessoffashion.com/articles/intelligence/brexit-fashion-2017british-break-up Maura Brannigan (2017) ’TOMMY HILFIGER IS TAKING HIS ‘SEE NOW, BUY NOW’ SHOW TO MILAN FASHION WEEK’ Retrieved from: https://fashionista.com/2017/12/tommy-hilfigertommynow-spring-2018-milan Katie Berrington (2016) ‘Gigi New York’s Legal Warning To Tommy Hilfiger’ Retrieved from: http://www.vogue.co.uk/article/gigi-new-yorks-warning-to-tommy-hilfiger
31
32