Elie Saab Marketing Analysis

Elie Saab Marketing Analysis Expanding a luxury brand without diluting its luxury status has become a challenge to many luxury brands. Premium luxury brands therefore need to plan their expansion strategy carefully. This report will focus on how the Elie Saab brand may develop by offering the brand extension of lingerie to be sold alongside its ready-to-wear collection. The price range of lingerie is normally lower compared to other ready-to-wear products, therefore this product extension has the potential to enlarge the accessibility of the ES brand and grow the current consumer segmentation. The new product line should inherit the brands essence. The launching and promoting of the new line will be an appropriate way for the brand to get more exposure and will reinforce its brand identity. The report will cover the product extension and communication issue respectively, while critically evaluate the plan as a whole. Started as a couture house in Beirut, ELIE SAAB (ES) has an ambition of turning into a global luxury brand. ES exclusively target on the worldwide super-wealthy class, while successfully maintains a loyal customer base from the Middle East. In addition, the brand is favoured by royalty, for its luxurious, feminine but slightly conservative style. ES dresses are widely present in different prestigious events, worn by celebrities from different regions. The product lines of ES currently include Haute Couture, Ready-to-Wear (RTW), Wedding Dresses, and Accessories. The expanding of the brand, however, continued through many forms including luxury hotel and super yachts (SHUAYTO, 2012). Nevertheless, there are still many problems exist, and if not handled carefully, they may remit the pace of ESs growth. it was pointed out that Elie Saab, owner of ELIE SAAB, wanted to be involved in not only every aspects of his Haute Couture line, but also all the branding decision making process. (SHUAY TO, 2012) Saabs tight control of the brand may consume most of his energy, which makes the brand expansion on product line rather difficult. Besides, with only 150 employees, (SHUAYTO, 2012) the ES Group is relatively small compared to other luxury brands from large luxury groups such as LVMH (100,00employees) (ARNAULT, N/D). Thus the amount of support ES could receive for expansion is very limited. Furthermore, recognition is a key element in conspicuous consumption, for it endows the owner of luxury product with admiration. (KAPFERER, 2012)ES have covered several communication channels in brand image building, but the exposure is still not enough. ELIE SAABs facebook page has received 800,987 likes (Facebook, 2013b), while Dior has 11,480,356 likes (Facebook, 2013a). It is the same on the ELIE SAAB YouTube channel (2013a), which only have 4,580 subscribers (Dior: 47,871) (YouTube LLC, 2013c), and on its twitter page (2013b) with 128,682 followers (Dior: 1,794,503) (Twitter,Inc., 2 013a). It would seem that ES havent caught much attention of the public. For such a vibrant premium brand, expending without diluting its luxury status requires a very well planed strategy. Regarding the situation mentioned above, the report will illustrate how ELIE SAAB could develop by introducing the brand extension of lingerie to be sold alongside its Ready-to-Wear line. The lingerie sector has enjoyed a continuous growth of 16.1% in the UK market during the previous five years. It was considered to be a treat for a woman in an affordable price during the recession. (Hucker, 2013) It is reported that in Western Europe and the US, the average number of lingerie purchased by a woman annually is two bras and around five briefs. As a function-oriented product, Lingerie is considered to be a necessity, and the need always exists. Nevertheless, despite the booming UK lingerie market, the global lingerie market suffered from the recession. Moreover, the market is overcrowded with many discount retailers sourcing from Asian countries, which is pulling down the pricing point. (Hughes, 2011) The price of bras range from under six pounds to over 250 pounds, but only a few brands produce premium lingerie (Independent Print Ltd., 2012). In the niche market of premium lingerie (NI Syndication Limited., 2007), the reputation of ES could be an advantage, let along i ts loyal high-end client base. Meanwhile, as the price range of lingerie is lower compared to High-end RTW (SHUAYTO, 2012), the new line would potentially enlarge the accessibility of the ES brand. Overall, entering the lingerie market could be a challenging opportunity for ELIE SAAB. The essential goal of this plan is to expand product range, increase brand exposure, and assist ELIE SAABs transformation into a global premium brand. Product extension Lingerie design, especially brassiere design, requires very specific skills and knowledge. The time required in the designing process is also particularly long. As lingerie is of great importance in shaping a perfect body, customers require optimum fit, high function, as well as attractiveness. From cups to shoulder strap, all of them are important in providing a centralized and firm appearance, while designing them equally costs great energy. (Liao Lee, 2010) Since ELIE SAAB is still a growing company with not much employees, and is a brand highly dependent on Elie Saab, the suggestion would be to achieve the expansion through licensing. But it should be handled very carefully, for licensing could possibility dilute the brand. (Hoffmann Stankeviciute, 2012) Some even argue that the key of maintaining the luxe of a brand is never get involved in licensing. (KAPFERER, 2012) While other suggest that though risking dilution, licensing still proves to be a fair choice for brands to acc ess expertise in the area where their knowledge and power is limited. (Colucci, et al., 2008) First and foremost, the lingerie line must inherit the sprite of ELIE SAAB. It should be designed and inspired base on the ES haute couture collection or RTW collection, and be cohesive with the collections of the core brand in style and aesthetics in that season. Consumers expect the luxury brand to offer them a product that possess the quality, design and value that the parent brand represents. (Hoffmann Stankeviciute, 2012) Especially for a brand like ELIE SAAB, which highly relies on loyal customers, (SHUAYTO, 2012) fulfilling the consumers expectation and keeping the brand image clear is exceptionally important. ELIE SAAB is known for its luxurious, dreamy, and feminine style.(Fig 1) Lace, chiffon, silk, crystal, hand-made beading and embroidery (NI Syndication Limited., 2007), those materials used in ES haute couture collections can also be seen in lingerie design, which could be counted as an advantage in reaching the coherence of core brand and lingerie line. The service provided for the lingerie line is equally important, for providing ultimate customer experience is another promise of the ES brand. To minimize the dilution of core brand, the ES lingerie line should be positioned as premium lingerie (Hoffmann Stankeviciute, 2012). The most important part of buying lingerie is fit (Law, et al., 2012). It is important for the consumers to feel comfortable in their lingerie (Liao Lee, 2010). However, most women do not know how to find a right size, and the sizes that many retailers provide are not accurate. Fitting has become a major problem for the lingerie industry (Hucker, 2013). Thus in every ES lingerie stores, there need to be at least one professional fitter to help, and provide the customers a one-to-one fitting service. Also, in the lingerie sector on the ES official website, a specific multi-media lingerie fitting guidance, using the form of video, picture and word description (Fig 2), should be provided. The cost of producing a fitting video and putting the information on the ES website could be quite low, but this effort may affect customers confidence of purchasing ES lingerie positively. bra fitting.jpg To improve customer experience, ES may consider providing customized lingerie. Co-design, which involves customers in the designing process of their own order, may be welcomed by those who eager for a differentiated, unique product. In the co-design process, customers are provided several pre designed options of each part of the product, and they can create a unique product by combining their choices. Burberry has put a co-design section on their website, where customers can design their own trench coat, and then order creation. (Fig 3) The co-designed trench coat will be produced separately. (Burberry Group Plc, N/D) Co-design offers a memorable experience to customers, which may interest the loyal customers, and possibly attract new customers. (Liao Lee, 2010) Nevertheless, the cost of producing co-design lingerie may be quite high. The Burberry co-design products are priced about one to two hundred pounds higher than their similar RTW products in the same length and material. The ratio of mark up is merely 0.18% approximately, due to the high price of the RTW product range. If ES decide to adopt co-design in the lingerie line, the ratio of mark up needs to be carefully calculated, in order to make enough profit, but still remain acceptable for the customers. Marketing communication The lunching of a new product line will probably draw much attention. Seizing the chance, ELIE SAAB may increase its exposure by doing a series of campaign, aiming at building the image of a global premium brand. Without enough brand awareness, it is very hard for luxury brands to create desire and attraction (KAPFERER, 2012). Hence, most luxury brands tend to build a whole brand image, rather than the image of a single product category. In addition, by showing the image of their target consumers lifestyle, brands could form an image of a brand users in the consumers mind. Potential customers may be attracted by the perception of a brands personality, moreover, may produce a stronger purchasing intention when they find similarities between their self-image and the image of a typical brand user (Fang, et al., 2012). Marketing the ES lingerie line by promoting the whole brand, emphasising the luxe of the core brand, may also protect the brand from dilution. Communicating the heritage inspiration and cultural reference may help a relatively new brand elevating its position in consumers mind. As a hedonic product, luxury products need to not only have a physical function, but also embraces a spiritual function. They should help consumers fulfilling their highest need, which is self-realization (KAPFERER, 2012). To create a scarcity effect, making the brand more desirable, ELIE SAAB may develop a marketing strategy based on culture and art. Producing a short film featuring the inspiration of the unique ELIE SAAB style may help consumers generating a better understanding of the brands cultural background, deepening the meaning behind each ELIE SAAB product. The film should also include the craftsmanship of ES haute couture collection. By showing the intriguing details of haute couture, from the inspiration, drafting to the hand-making process, the film need to plant the concept of haute couture being an art into the viewers mind. Consequent ly, as the brand producing art, ELIE SAAB will be viewed differently. Linked to art, ES products would be seen as artistic creations, rather than commercial goods (KAPFERER, 2012). It embodies the extraordinary taste of its customers, while remains to be a desirous dream of the non-owners. Another way of marketing ELIE SAAB as an artistic brand is to hold and exhibition showing the history and creations of the brand. The company could partner with an art museum, and show their archived pieces from previous fashion shows. Also, the creating process may be an interesting to show on the exhibition. It would be better if the showroom could be designed as a vision of the earliest inspiration of Elie Saab, telling his story of creating art, rather than a copy of an ES flagship store. This is to avoid being viewed as a commercial activity. However, the cost of holding an exhibition might be quite high, and the influence of an exhibition is geographically limited. With the booming of social media, today, marketing is more about communicating and interacting with consumers. Adopting the trend, brands start to pay more attention on digital channels (KAPFERER, 2012). ELIE SAAB is not an exception. The brand has adopted many digital communication platforms including facebook, twitter, YouTube, even weibo.com. Nevertheless, it is noticed that the communication result ES achieved in those platforms is not very impressive. Comparing to its competitors, the number of people getting involved in ESs digital communication channels is quite small. Besides, they do not seem to be very impressed by the information they have received from the ES channels. ELIE SAAB Le Parfum Ad Campaign video has only received 73 likes. (YouTube LLC, 2011) In contrast, the Miss Dior advert, La vie en rose, received 991 likes. (YouTube LLC, 2013b) As for the short films featuring brand identity, the ES Balade a Paris film has received 209 likes, (YouTube LLC, 2012a) while the Dior Secret Garden-Versailles film has received 6,029 likes (YouTube LLC, 2012b). All the films mentioned above are beautifully made and clearly reveal their brand image. Yet the Miss Dior film appeared eight times on the Dior facebook page (Facebook, 2013a), while the ES Balad a Paris film only appeared in four posts on the ES facebook page (Facebook, 2013b). It can therefore be then presumed that the link between different digital platforms the brand use has some influence on the communication result the brand may receive. ELIE SAAB may want to strengthen the connection between its different communication channels, in order to increase communication efficiency. Critical evalution For a premium brand, expanding through licensing is a huge risk. Being one of the two largest apparel categories of Calvin Klein (Schimroszik, 2012), underwear, which was licensed to the Warnaco group, was a huge success in the 1980s (Robertson, 2012). By 1999, licensing contributed 90% of Calvin Kleins revenue. Yet soon enough, the Calvin Klein brand found that it had little control of its licensees, under an incredible long contract. The luxury status of Calvin Klein was almost destroyed. It took Calvin Klein eight years to get back into business, and slowly started repairing the damage brought by licensing (Hoffmann Stankeviciute, 2012). Notwithstanding the risk, licensing still is a popular expanding method among luxury brands (Colucci, et al., 2008). In fact, if handled carefully, the damage can be minimized (Hoffmann Stankeviciute, 2012). As ELIE SAAB does not have the expertise in lingerie production, licensing is a reasonable choice. But the brand should have tight control over the licensee. The major problem of licensing is the licensees tend to pursuit the fastest success and biggest profit, regardless the impact it may have on the brand. The licenser wants to maintain the consistency of the entire collection, while the licensees may prefer to stick with the most popular designs in the market (Colucci, et al., 2008). And it is the responsibility of the core brand to protect its reputation, including product quality, design aesthetics, customer service, and luxury status. But the licensee might be producing for different brands simultaneously, thus the design of the different products they produce might be similar, or they might borrow the design of ELIE SAAB, and use it in other products that they are producing. Even there is a possibility that the licensee may secretly produces counterfeit version of the ES linge rie using cheaper materials, and sells them in other channels or under other brand names. All of the mentioned problems may result in brand dilution. As a result, ES may need to spend much effort in monitoring the licensee. Despite the drawbacks, with a right partner, ES could achieve the expansion with a relatively low cost. If the plan was executed successfully, the brand could increase brand awareness, and might reinforce the loyalty of its existing customers by impressing them with a new and exciting product line. For some women, lingerie is as important as outer clothing. So the ES customers might be interested in matching the lingerie and the outer wear. Another issue to be concern is the cultural impact of lingerie line. Intimate apparel may have different symbolic meanings in different culture. When marketing globally, it should be noticed that women from different culture may have different need in lingerie. Many ES customers are from the Middle East, where, in the outsiders view, might be quite conservative. On the contrary, it was discovered that sex is quite important for married Muslims. (Asser, 2008). As a result, they may be very interested in lingerie of various bold designs. In the forthcoming years, there is expected to be a recovery of the economy. It could affect the whole luxury market, and could be an opportunity for premium lingerie. Yet the competition among lingerie specialist brands would also be fierce. Many lingerie brands are aiming to the global market, including Victorias Secret, Agent Provocateur, et cetera. With so much choice, consumers might doubt the expertise of the ES lingerie line, because lingerie is generally function-based product. Besides, the link between the lingerie line and the brand emphasising advertise champagne might be weak and confusing. The new lingerie line might be ignored due to this reason. Conclusion and recogminadions Product expansion means a new adventure for a brand. As a young luxury brand that is eager to develop, product expansion will always at some point be adopted. The previous partnership experience of ELIE SAAB indicates that Saab could be not only a brilliant designer, but also a successful businessman. Hence, the risk of expending a new lingerie line through licensing could turn out to be another success of the brand. But ELIE SAAB should choose the partner very carefully. Both the reputation and the producing capability should be taken into consideration. A partner with well established reputation in the industry is the reassurance of quality for the customers (Hoffmann Stankeviciute, 2012). Moreover, ELIE SAAB should have strict control over the licensing project, making sure the products and service remains in the same level as the core ES products. The places where the lingerie line products are sold should also be chosen using ES criterions. The price-point of the lingerie line should remain high, in order to match the premium status of the ES brand. The marketing of the lingerie line is suggested to be focused on building the whole brand image, rather than the single lingerie line. Nevertheless, advertisements featuring the lingerie line product are also needed. ELIE SAAB may consider spending most of its budget on overall brand image campaigns, and only using a small part of the budget to do the lingerie line advert. Overall, the whole plan is designed to assist the developing of the ELIE SAAB brand as a whole, and the main focus should be always on its core products. Otherwise, without the success of the core brand, the lingerie line will soon be forgotten as well.