Fashion Marketing

What are some marketing misconceptions?

• Marketing does not equal advertising

• Marketing does not equal short-term sales

• Marketing does not equal selling people items they don’t need

Luxury brands also do marketing,

What are the fundamental elements of marketing?

• Customer Requirements

• Social Process

• Exchange Process

• Managerial and Business Process

• Value

• Marketing Process

What are the customer requirements?

Brand’s value derives from the current and and future.

Goal → Trust-based long-term relationship with consumers.

Method → Study and research, meet their needs better than competitors.

Tools → Customer Relationship Management, equity, lifetime value, and research.

What is the social process?

Using the fashion social system (press, media, shows, fashion weeks) to spread symbols, set norms, and trigger shared behavior like trends and buzz.

What is the exchange process?

Traditional Exchange: Product/Service → Money

Non-Traditional Exchange: Data, attention, and Content → Money

What is the managerial and business prcoess?

Long-term Profit = Loyal Customers + Positive Unit Economies

• Goal: Business to flourish and earn a sustainable profit

• Manager’s Toolkit: Choose who we serve (S + T), and how we differ (P).

• Ochestrates seven p’s!

  • Product

  • Place

  • Price

  • Promotion

  • People

  • Process

  • Physical Evidence

What is value?

Value is based on product, service, packaging, store, site, app, fulfillment, returns, care, and repairs.

• Perceived Value is the net benefit a customer feels across the whole journey = (functional, emotional, symbolic benefits) - (money, effort, time, and risk)

What is the marketing process?

Research Market → Design Strategy (STP) → Build Program (Marketing Mix) → Build Relationships (Customer Relationship Management + Partner Relationship Management) → Capture Value (Customer Lifetime Value = Satisfaction, Retention, and Loyalty)

• STP is introduced, differentiation and competitive advantage as well.

• Marketing Mix: 4 P’s (Product, Place, Price, Promotion) and 7 P’s

What are the three definitions for fashion?

1. Cultural industry for emotion and cultural identity.

2. Fashion is a language, with codes and signs.

3. Fashion is sociology, psychology, and anthropology.

What type of value does fashion have?

Symbolic and Economic

how many chains are there in fashion?

Two!

• Textiles

• Accessories/Shoes

What are the different market levels in fashion?

• Haute Couture

• Luxury

• Middle Market

• Mass Market

• Value Market

CASE STUDY → Armani

What are the fashion seasons?

S/S, F/W, resort wear, and pre-fall.

What are the fashion capitals of the world?

Paris, NYC, Milan, and London

What are the two markets?

1. B2B → Business to Business, someone purchases to resell, called a client

2. B2C → Business to Consumer, someone purchases for themselves based off of need, want, likeness, called customers.

What is the core tension with B2C business?

Customer wants product now what the system delivers in six months

What are the solutions to the core tension?

1. Accelerate → See now, buy now. Drop capsule collections! Cost: Supply chain, creativity

2. Redesign the Calendar → Not just two seasons, all year round! Cost: Newness must never stop.

3. Leave the Calendar → Private shows, cruises. Cost: Only works if you already have the equity.

What are the fashion channels?

Shows, Press, Visual Merchandising, influencers

What are the channels’ three jobs?

1. Sell

2. Press

3. Social

What are the planning lead times?

• Designers - 1 year

• Mills - 2 years

• Fibers - 2.5 years

• Color Forecasters - 3 year4s

Why is the fashion industry risky?

Because you need to monitor the preset and predict the future.

What is the research process?

Define → Design → Collect → Analyze → Decide

• Management Decision Problems vs. Marketing Research Problems

• Market Research (outside) vs. Marketing Research (Inside the business)

What are the different marketing environments?

• Microenvironment → PESTEL

• Microenvironment → Customers, Competitors, Suppliers, Distributers,

• Internal Environment

The need for reactive and proactive marketing!

What are the different types of research?

• Qualitative vs. Quantitative

• Primary vs. Secondary

Can be in-housed, outsourced to agencies, consultancies, trend scouts.

What is the source ladder?

Primary Public Data → Peer Reviewed → Institutional Reports → Trade Press → Commentary

What are the different types of trend research?

• Trend Reporting

• Trend Forecasting

What are the three trend theories?

• Trickle Up

• Trickle Down

• Trickle Across

What are three types of trends?

• Fad

• Trend

• Megatrend

How can we research future trends and future competition?

Competitor intel and analysis

What are Porter’s Five Forces

1. Competitive Rivalry

2. Supplier Power

3. Buyer Power

4. Threat of Substitution

5. Threat of New Entry

What are the primary research methods?

1. Observation: Comparative shopping, mystery shopping, interviews, questionnaires, focus groups

2. Questionnaire design, likert scale, pilot test

3. Inbox audit, hiring signals. synthetic panels

DATA → INSIGHT → FOCUS STRATEGY

Who is the customer?

• Client or customer depending on B2B or B2C

• Engager, co-creator, prosumer, sellsumer: NEED → WANT → DEMAND → MARKET DEMAND

• Buyer’s Black Box: Stimulus in, Behavior out!

How do customer’s decide?

Using their perceived value! = Satisfaction, Loyalty or Switching

• Personal, social, cultural, and psychological factors.

• Motivation, perception, learning, beliefs, and attitude.

Word of Mouth > Reviews > Influencers > Paid Ads

What are the five fashion adopters?

1. Innovators (2.5%): Risk takers, creative and exclusive

2. Early Adopters (13.5%): Opinion leaders, seek status and meaning

3. Early Majority (34%): Wait for social proof

4. Late Majority (34%): Adopt under social pressure

5. Laggards (16%): Adopt only when they are unable to continue.

What are the five attributes that speed up adoption?

1. Relative Advantage

2. Compatibility

3. Low Complexity

4. Trialibilaity

5. Observability

Too early can be as detrimental as adopting too late!

What is the purchase decision process?

• Need Recognition

• Information Search

• Evaluation of Alternatives

• Purchase Decision

• Post-Purchase Evaluation

There is also compulsive buying and country of origin effect (using stereotypes to instill confidence of a product) that also can happen within purchases.

Differences between linear funnel and loyalty loop:

Lineal Funnel:

• Straight line from top to bottom (Awareness → Interest → Consideration → Purchase).

• Mindset: Reactive and company-driven; pushes prospects down by narrowing choices.

Loyalty Loop:

• Structure: Circular or loop-shaped model popularized in McKinsey’s Consumer Decision Journey.

• Mindset: Proactive and customer-centric; focuses on continuous relationships.

What is segmentation?

The sequence about demand, not competitors. → Splitting up are market to find an area to focus on for business!

• Variables: Geographic, Demographic, Economic, Geodemographic, Psychographic, Behavioral.

FUN FACT: People under 28 will make up 40% of the fashion market in the future.

• Future = Personalization + Risks

What are the different types of consumers?

• Butterflies

• True Friends

• Strangers

• Barnacles

VICs make up for 40% of the luxury sales.

What is targeting/

The idea to target the right market and consumer for the product

• Two filters: Segment Attractiveness and Strategic Fit

• Four Strategies: Undifferentiated, Differentiated, Niche, Mixed

Persona as a decision model!

What is positioning?

Where the brand stands

• Intended vs. Perceived:

  • Positioning Map vs. Perceptual Map

• Positioning Gap Causes → Inconsistent communication, Distribution dilation, Price signal mismatch, and overextension.

  • Need to reposition!

What is differentiation according to Porter?

Valuable, Perceivable, Defensible.

What are some advantages?

• Unique selling propositions

• Competitive advantage formulas → “stuck in the middle”

• Emblems

What are the four parts of a product?

1. Core

2. Expected

3. Augmented

4. Potential

What is the product formula?

Product = Tangible + Intangible

• Attribute does not equal benefit!

  • Funstional, emotional, social benefit: NEED → DESIRE → DREAM

What is the portfolio/product mix?

Product Mix: Newness, carry over, Iconic

• Ratio shows position: Luxury = Icons, Fast Fashion = Newness

• ICONS: Hermes Kelly

Mix is the margin!

What is the product life cycle?

• Introduction

• Growth

• Maturity

• Decline

What are the three types of products?

• Fad

• Trend

• Classic

What is the 20 year cycle?

• Dated

• Vintage

• Iconic

Creating a Collection…

SUPPLY CHAIN: Sourcing → Production → Logistics → Retail

LEAD TIME: Fast Fashion → 2-6 Weeks, Luxury → 6-12 months

INSOURCING VS. OUTSOURCING: Offshoring, Nearshoring, reshoring, vertical integration

• Porter’s value chain!

  • Inbound Logistics → Operations → Outbound Logistics → Marketing/Sales → Services

What is value?

Costs = Price + Time + Effort + Risk

• Value Drivers: Heritage, Product/Process, experience

  • Verdict feeds the next season!

What is teh anchor of pricing?

Strategy decides position, product delivers it, but price defends it.

• NEED → DESIRE → DREAM: one product, three prices.

• Price is a signal (retail vs. wholesale)

• Fixed or Variable

• Markup does not equal margin

• Gross margin vs. Operating Margin: Gross margin measures product-level profitability after direct production costs, while operating margin evaluates total core-business efficiency after subtracting both production and operating overhead expenses.

WTP in Fashion Marketing:

• Perceived Value → Price power must be reearned over and over.

• Supply/Demand

• Elasticity

• Psychological Pricing → Price = Quality

What happens before we choose a strategy?

1. Competitor research.

2. Starting Point → (Base Price) = Unit Cost x (1 + Mark Up %)

3. Boundaries → Price is between floor and ceiling

4. Pricing Logics: Must be either value based, competition based, or cost based

OBJECTIVE → maximize profits!

What is the pricing ladder?

Each price is set within the whole product mix, not just individually.

• Price RANGE: Entry, mid, premium, top.

• Luxury Ladder: Entry level items let people in, icon bags are for the top.

  • Tension: Entry prices let people in, but can dilute the brand.

What is the definition of time within pricing?

Two price curves → Seasonal and Luxury

• Seasonal: Gradually declines

• Luxury: Rises

What is the timing of a product price?

1. Introduction: Build desire

2. Growth: Scale without diluting

3. Maturity: Defend share and hold anchor price

4. Decline: Rxit without damaging brand equity through markdowns, reselling, outlets, recycling, etc.

What are the tactics for pricing?

1. Promotion Pricing: Short term discounts: Risk → People wait for discounts only

2. Segmented: Different prices by market: Risk → Grey markets and resellers.

3. Dynamic: Prices move with demand, stock, and competition: Risk → Shoppers think it is unfair