tenisha clarke blair young stephanie tedder retail buying simulation winter 2013
table of contents company profile
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merchandise analysis
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competitor analysis: michael kors
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michael kors merchandise analysis
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competitor analysis: marc by marc jacobs
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marc by marc jacobs merchandise analysis
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competitor analysis: coach
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coach merchandise analysis
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perceptual maps
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six month sales plan
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store a and sales plan
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store b and sales plan
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store c and sales plan
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mood board
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trend report and analysis
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color & materials
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sales by classification & assortment planning
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assortment justification
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sources
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company profile overview
history
crisp color, graphic prints and playful sophistication are hallmarks of kate spade new york. as our world expands, our exuberant approach to the everyday is evident in each category we enter, from handbags and clothing to jewelry, shoes, stationery, eyewear, baby, fragrance, tabletop, bedding and gifts. kate spade new york has over 80 retail shops and outlet stores across the united states, and more than 100 shops internationally. our colorful products are sold in more than 400 doors worldwide, in every time zone and on every continent. whether in san francisco, sao paulo or shanghai, our shops are always warm and inviting.
•1993: founded by kate and andy spade •1996: first store opened in SoHo •started as practical and comparatively affordable handbags, “iconic american brand” •2005: operated 19 retail stores, 4 outlets, only $84 million dollars in net sales •2006: sold to liz claiborne inc., fifth & pacific •2007: deborah lloyd, president creative chief •clothing, shoes, jewelry, perfume, home décor stationery, tabletop and eye wear was added •2008: brand repositioned to include a younger target market •2014: over $750 million in sales
mission statement kate spade new york draws women into a world that’s culturally curious, intellectually alive, and glowing with irresistible allure. there are stories to capture the imagination, and dramas to unfold. kate spade new york encourages women to star in their own lives. to be courageous. to indulge their many passions. to tune out the noise of fashion fads and mediocrity in all its forms. kate spade new york is the brand that helps women express their own personal style with incandescent charm and a dash of rebellion.
promotions •coupons throughout the year •surprise sales online for loyal customers •end of season sales •friends and family weekend twice a year our buying role we will be buying for the handbag category.
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merchandise analysis handbags on average, handbags compose 66% of total sales company wide. price points in store range from $228-498, while the most common pricing is $298 or $398. newest handbags are located in the front of the store, while older collections are located in the back.the most popular handbag is the cedar street maise, priced at $298. materials •leather -patent -pebble -saffiano -cowhide •nylon •canvas •vinyl •tweed •felt •sequins •silk
silhouettes
satchel
shoulder
tote
cross body
clutch
baby bag
top handle
backpack 4
michael kors overview michael kors is a rapidly growing global luxury lifestyle brand led by a world-class management team and a renowned, awardwinning designer. since launching his namesake brand 30 years ago, michael kors has featured distinctive designs, materials and craftsmanship with a jet-set aesthetic that combines stylish elegance and a sporty attitude. mr. kors’ vision has taken the company from its beginnings as an American luxury sportswear house to a global accessories, footwear and apparel company with a presence in 74 countries. over the years, the company has expanded beyond apparel into accessories (including handbags, small leather goods, eyewear, jewelry and watches) and footwear. history •1981: launched womenswear line at bloomingdales, bergdorf goodman, lord & taylor, neiman marcus and saks fifth avenue •2004: launches runway collection, michael michael kors and kors michael kors •michael michael kors was created for a younger demographic and has a strong focus on accessories; carried in all lifestyle stores as well as leading department stores throughout the world
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merchandise analysis handbags handbags range from $98-2995 company wide, and $198-995 in store. merchandised throughout stores by color. most popular handbags are the hamilton saffiano large tote ($328-398) and the selma saffiano satchel ($358-498). materials •leather -saffiano -pebble -quilted •python •pvc •suede •canvas-jute •deerskin
silhouettes
tote
shoulder
cross body
satchel
clutch
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marc by marc jacobs overview marc jacobs has built an empire on fashion that keeps the world waiting in awe of what the designer will show next. marc jacobs international is a renowned design house that creates men’s and women’s apparel collections (under the marc jacobs collection and marc by marc jacobs names) and a children’s line under the little marc label, as well as footwear, handbags, sunglasses, timepieces, and fragrances. the company operates more than 250 stores internationally and sells through highend department and specialty retailers. it was founded by marc jacobs and business partner robert duffy (president) in the 1980s. the company is part of the stable of brands held by french luxury firm lvmh, which owns a 96% stake . history •1986: marc jacobs launched the Marc Jacobs fashion line •1997: the brand opened its first store in soho •2001: marc by marc jacobs line launches •2008: launched a limited edition line of fragrances
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merchandise analysis handbags handbags range from $78-698. employees in each store are given free reign on how to merchandise the handbags throughout each different store location. the most popular handbags are the classic hillier hobo ($428) and the classic q natasha ($328). materials
silhouettes
•leather -cow -sheep •nylon •canvas •tpu •polyester satchel
shoulder
tote
cross body
clutch
baby bag
top handle
backpack 8
coach overview coach was founded in 1941 as a family-run workshop. in a manhattan loft, six artisans handcrafted a collection of leather goods using skills handed down from generation to generation. discerning consumers soon began to seek out the quality and unique nature of coach craftsmanship. now greatly expanded, coach continues to maintain the highest standards for materials and workmanship. coach’s exceptional work force remains committed to carefully upholding the principles of quality and integrity that define the company. the prominence of the coach brand is attributed to the unique combination of their original american attitude and design, our heritage of fine leather goods and custom fabrics, our superior product quality and durability and our commitment to customer service. coach’s distribution strategy is multi-channel. as of july 2013, there were over 500 coach stores in north america, over 400 directly-operated locations in asia, and 20 in europe. coach also operates e-commerce websites in the united states, canada, japan, and china with informational websites in over 20 other countries. beyond the company’s direct retail businesses, coach has built a strong presence globally through coach boutiques located within select department stores and specialty retailer locations in north america, and through distributor-operated shops in asia, latin america, the middle east, australia, and europe. 9
merchandise analysis handbags handbags range from $138-1198. they are merchandised throughout the store by color, with the newest collection in the front of the store, and sale items located on the back wall. The most popular silhouettes are the classic madison satchel ($358) and the madison phoebe shoulder bag ($398). silhouettes materials •leather -gathered twist -pintuck -box grain -op art •coated canvas satchel
shoulder
tote
clutch
baby bag
backpack
cross body
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perceptual maps
high price
trendy design
narrow product range
wide product range
classic design
young customer age 20
old customer age 50
low price
opportunities while kate spade does offer a range of classic handbags, the variety of trendy designs is greater. there is an opportunity in offering a wider range of classic designs, as there is almost no competition in that area based on our first perceptual map. based on the second, there is a similar opportunity in providing more handbags at a lower price, which could potentially be more appealing to a range of customers in both a younger and older demographic.
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6 month plan we referred to the kate spade new york annual reports from 2010-2012 to formulate our fall/winter 2014 buying plan (in millions). from 2009-2012, the company experienced a fluctuation in the percent increase and decrease in sales (-15.84% in ‘10 from ‘09; -6.44% in ‘11 from ‘10; -0.90% in ‘12 from ‘11). during this time period kate spade new york transitioned from being a part of liz claiborne to the fifth and pacific family, and has most recently been changed to kate spade and company. we assumed that this contributed partially to the fluctuation of sales for ksny, and decided to plan the company down (-2.60%) from last year’s sales during this season to hopefully account for the most recent change in ownership. we learned from our visit to the savannah store that handbags average out to be 66% of sales, and through the annual report that third and fourth quarter sales make up 56% of yearly sales due to the friends and family sale that takes place in october and a vast amount of sales for holiday in december. we predicted that by lowering planned sales and choosing to keep initial markup and retail reductions consistent with that of the previous year, the company would potentially achieve a greater profit and see an increase in sales.
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a store kate spade new york - madison avenue 789 madison avenue new york, new york 10065 212.988.0259 store hours: sunday 11a - 6p monday 10a - 7p tuesday 10a - 7p wednesday 10a - 7p thursday 10a - 7p friday 10a - 7p saturday 10a - 7p fall weather average: high 50-70, low 40’s target customer age: 25 - 45
population 8,336,697 female population 4,301,787 age 25-45 2,965,757
sophia james sophia james is a kate spade new york madison avenue customer. she is 38, and a corporate event planner with an average yearly income of $75,000. sophia is passionate about her job; she is highly motivated, creative, and always thinks outside of the box. she thrives when she is put in her planning element. she is married to her wonderful husband of 10 years, edward james, and has a beautiful 5 year old daughter, bella victoria. she also has two dogs names corkey and noah. sophia loves galmour and all things beautiful. her hobbies include decorating, event planning for her own personal parties, fashion, and shopping at her favorite store, kate spade. her buying habits are researching before she shops. by browsing online, she knows exactly she wants before entering the store. sophia looks for style and quality, and kate spade has exactly that. her favorite handbag is the holly street ashton.
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6 month plan
our a level store is located on madison avenue in the heavily populated city of new york. it is the kate spade new york flag ship store, and is surrounded by many other luxury retail shops. it generally attracts a higher end customer, both natives and tourists, who is willing to spend more money per visit and isn’t overly concerned with price points and what items may or may not be on sale. our research showed that over half of the population in the store’s area are female, and of those that are female, over half are in our target age group. because kate spade is a new york brand, it is very popular with women in the new york area, and because this is the flagship location, it is very popular and turns merchandise much quicker than small stores. distribution of sales and reductions depended heavily on holidays and sales events that happen throughout the season. the store sees a majority of their fall/winter sales in october, november and december. october accounts for a large amount of reductions and sales because customers tend to take advantage of friends and family discounts provided. sales increase from october through december due to gifting preparation for the holiday season. december has a low reduction percentage due to the fact that sales are almost guaranteed because customers in this area want to give a great, quality handbag as a gift, regardless of the dollar amount on the price tag.
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b store kate spade new york - southpark mall 400 sharon road #164 charlotte, north carolina 28211 704.367.5053 store hours: sunday 12:30p - 6p monday 10a - 9p tuesday 10a - 9p wednesday 10a - 9p thursday 10a - 9p friday 10a - 9p saturday 10a - 9p fall weather average: average high 67, average low 46 target customer age: 25 - 34
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population 775,202 female population 384,580 age 25-34 130,450
jennifer matthews jennifer is a customer for the cbarlotte kate spade store, which is located in the south park mall. jennifer is a college graduate of the university of north carolina, with a degree in business management and marketing. she is 29 years old, and is in a public relations management position at neiman marcus. her annual income is $65,000. she loves to stop in the kate spade store on her break and check out the new styles. because it is a fairly small store, she also researches new bags quite a bit online. her buying habits consist of buying functional bags that are professional in quality but showcase her personal style. because she does online research, she usually has an idea of what she wants, but loves employee feedback as well. she is most interested in totes and shoulder bags. her favorite collection is the cobble hill, and she loves the minka and leslie silhouettes.
6 month plan
our b level store is located at the southpark mall in charlotte, north carolina. this particular mall has quite a few luxury retailers, and houses our competitors coach and michael kors, as well as louis vuitton and burberry. higher end and more conservative customers shop at this location as well, and we learned that sales are generally obtained through outreach by employees to a longtime, loyal client base. we determined sales based on figures provided from management during our savannah store visit. charlotte is a b level store that brings in approximately $2.1 million in revenue per year. we calculated 66% of that for the total 2014 handbag sales ($1,386,000), and took 56% of that for third and fourth quarter sales. distribution of sales and reductions were distributed similarly throughout the season for this location. there are a slightly greater amount of reductions taken at the b store level because the shopper at this store is a bit more conscious of the relationship between dollar amount and the quality of product. while price doesn’t make a huge impact still, she’s more likely to buy a good, quality bag on sale that has gotten rave reviews over a long period of time, rather than a new, trendy handbag that has simply been praised for being pleasing to the eye.
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c store kate spade new york - west broughton 319 west broughton street savannah, georgia 31401 912.495.6505 store hours: sunday 12a - 6p monday 11a - 7p tuesday 11a - 7p wednesday 11a - 7p thursday 11a - 7p friday 11a - 7p saturday 11a - 7p fall weather average: average high 78, average low 48 target customer age: 19 - 45
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population 137,690 female population 71,407 age 19-45 64,365
victoria gonzalez victoria is a kate spade new york west broughton customer. she is 32, and is a corporate accountant as well as a yoga instructor. her combined average yearly income is $74,000. she is very friendly and outgoing, and enjoys the thrill of new experiences. she is a college graduate with a degree in business administration. her hobbies include traveling, dancing, reading, shopping, and getting together with friends and family on the weekend. victoria is simply an overall brand lover. she visits the store, on average, twice a week and loves hearing about new products and always keeps up with sales and store events. she trusts and values the opinions of employees, and buys based on popular trends. she loves bright colored and patterned handbags, and loves to incorporate the “colorful living� that kate spade is known for into her everyday look. victoria’s favorite collection is catherine street, particularly the joanie and pippa handbags.
6 month plan
our c level store is located in downtown savannah, georgia. it was recently opened in july of 2013, and, according to management, is a shop that was established more so for brand exposure. most customers are tourists, and a lot of times out of town shoppers come in simply to be exposed to the merchandise, and return back to their home stores to actually make purchases. it has a slightly larger square footage than the b level charlotte location. similar to that location, sales are generally obtained through outreach by employees to local businesses and a growing client base. sales figures were determined by numbers provided from the savannah location. we planned for a small increase in sales. because the store is brand new, we are expecting to see an increase as time progresses and location awareness becomes greater amongst locals. customers at this location love a good sale. there is a large collegiate population in savannah, so we predicted that student discounts would be utilized a great deal around back to school time. as with our other locations, the largest amount of revenue was seen during the holiday season, so we planned accordingly with a low amount of markdowns and applying almost 24% of sales distribution to the month of december.
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mood board
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trend report & analysis
kate spade new york is a lifestyle brand that carries handbags for a wide range of consumers. for fall/winter 2014, we will look to buy a broad assortment of colors, fabrics and silhouettes while staying true to the kate spade brand. prints and some newly introduced materials are nature and travel inspired, and colors will adhere to the pantone trends forecasted for the season. we will carry the same classic silhouettes that have been a part of the brand for years, which were very consistent with runway trends that we researched as well, while incorporating new trends, pertaining moreso to color and materials, as they fit into the brand aesthetic.
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color & materials
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nylon
saffiano leather
cotton twill
pebbled leather
tweed
patent leather
canvas
cowhide
sales by classification & assortment planning silhouette satchel/top handle shoulder tote cross body clutch baby bag backpack
color 18% 24% 24% 14% 12% 6% 2%
black nude aluminum radiant orchid aurora red mustard yellow sangria mauve mist cognac bright cobalt cypress royal bue holographic
pricing 24% 22% 5% 9% 6% 3% 2% 1% 11% 6% 2% 8% 1%
$228-268 $268-298 $298-328 $328-368 $368-398 $398-428 $428-468 $468-498
12% 14% 12% 14% 16% 18% 8% 6%
fabric/material leather nylon tweed canvas cotton twill fur cowhide
47% 19% 11% 7% 5% 4% 7%
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assortment justification
as buyers for handbags, our categories are generalized into groups by silhouette, color, pricing and fabric and material. the average kate spade new york handbag customer is a girl on the go who tends to go for something “everyday� that can carry all of her belongings. our visit to the savannah store and online research showed that the tote, shoulder bag, and satchel/top handle are the most favorable amongst customers, as a majority of them are working women. when we approached customers, we found that they like these silhouettes because they are spacious and have a very structured and professional look to them, which is necessary for school and even in the work place. we also wanted to buy more classic silhouettes and colors, as that was an opportunity we noticed when creating our perceptual maps. our store visits and research also gave us quite a bit of information about fabric, material, and color, which helped us determine our assortment for those categories. nearly half of all kate spade new york handbags are made of leather, whille nylon is the next most desired product, especially for women that are mothers that need a bag than cleans easy (most baby bags are made of this material). fur was a very prevalent forecasted trend for the fall/winter season of this year, so we allotted 4% of purchases to go toward handbags made of fur. the kate spade customer, as stated before, is usually a woman who is in and out of the workplace daily. therefore, she tends to go for a handbag that is a solid neutral color such as black, nude, navy or any shade or variation of these. we determined our other color choices based on colors that sold well during the fall/winter 2013 season (maraschino, a red-orange color & vivid snapdragon, a pinkishfuschia color). price point percentages were determined by information given during our savannah store visit as well. most bags are going to be either $298 or $398, which are price points that customers are familiar with and consider average. $398 was seen more in store, and was the price point of many of the handbags in the most popular collection, the cobble hill.
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sources Accessory Reports. Stylesight. Retrieved from http://www.stylesight.com/fashionoffice/landing_pages/node. php?node=4878&gender=w American Fact Finder. U.S. Census Bureau. Retrieved from http://factfinder2.census.gov/faces/nav/jsf/pages/index. xhtml Average Weather Search. World Weather and Climate Information. Retrieved from http://www.weather-and-climate. com/average-monthly-Rainfall-Temperature-Sunshine-in-United-States-of-America Investors. Kate Spade and Company. Retrieved from http://www.katespadeandcompany.com/web/guest Kate Spade New York Fall 2014 Ready-to-Wear. Style.com. Retrieved from http://www.style.com/fashionshows/ review/F2014RTW-KSPADE/ The Company. Kate Spade New York. Retrieved from https://www.katespade.com/THE-COMPANY/katespade-thecompany,en_US,pg.html The History. Kate Spade New York. Retrieved from https://www.katespade.com/THE-HISTORY/katespade-thehistory,en_US,pg.html Trend Reports. Stylesight. Retrieved from http://www.stylesight.com/fashionoffice/landing_pages/node. php?node=3197&gender=w
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