Posts Tagged ‘branding’

Was Marketing Research Absent from Liz Claiborne’s Strategy to Target Younger Consumers?

August 17, 2010

Yesterday’s Wall Street Journal reported that Liz Claiborne’s efforts to appeal to younger female consumers may have been the company’s downfall. This month, J. C. Penney will launch an exclusive line of Liz Claiborne clothing, home and accessories. As part of the agreement, Claiborne cedes control of production and marketing and converts the label into a mass market line in exchange for royalties, the article reported. In five years, Penney also has the option to buy U.S. rights to the Liz Claiborne name.

This may well be the concluding chapter in what appears to have been a failed attempt by Liz Claiborne to broaden its appeal to younger women. Apparently, Claiborne realized correctly it would need to move to a younger consumer, as most of its customers had been working age Baby Boomers, who have begun to retire. However, the Wall Street Journal indicates that its efforts to target the younger female consumer actually did more to harm the brand.

In trying to appeal to the younger crowd, Liz Claiborne nixed, sold off, or licensed out tried and true lines; it changed designs so much that it confused its existing customer base; it introduced lower priced items, eroding its appeal as a high-end brand; and it alienated its long-term relationship with Macy’s.

As I read the article, I couldn’t help asking myself whether Liz Claiborne did its homework. I don’t know whether Claiborne did or didn’t do marketing research, but deciding to pursue a new target market requires extensive marketing research, because so many mistakes can be made because of unaided judgment. Among other things, it is important to have surveyed the younger female shoppers to understand what they needed for workplace casual attire; and to have looked for common ground between existing product lines and the new, emerging fashions that the younger crowd was embracing. Most likely, the research would have led Claiborne to develop lines that were new enough to appeal to the younger working woman, but traditional enough to maintain loyalty with its existing boomer customer. If the research showed that the younger women wanted something drastically different in the way of style, then Claiborne could have used that information to develop a completely different line (likely by launching a whole different brand) aimed at those preferences.

When appealing to a new target market, it is also important to do pricing research. Surely younger consumers don’t have the discretionary income that older ones do. But that doesn’t necessarily mean a company should introduce lower-priced apparel. As Van Westendorp pricing theory suggests, a price can communicate one of four things to consumers: a good buy, a luxury item, an overpriced item, or a cheap, low-quality item. I could only wonder whether the introduction of lower priced merchandise might have led consumers to believe the newer lines of Liz Claiborne were of lower quality.

Companies that don’t conduct marketing research – or conduct it inadequately – increase their risk of failure, declining sales, customer defections, and increased competition.

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Help us Reach 200 Fans on Facebook!

Thanks to all of you, Analysights now has more than 150 Facebook fans! We had hoped to get up to 200 fans by this past Friday, but weren’t so lucky. Can you help us out? If you like Forecast Friday – and our other posts – then we want you to “Like” us on Facebook! And if you like us that much, please also pass these posts on to your friends who like Insight Central and invite them to “Like” Analysights! By “Like-ing” us on Facebook, you’ll be informed every time a new blog post has been published, or when new information comes out. Check out our Facebook page! You can also follow us on Twitter. Thanks for your help!

Even Pro Baseball is Marketing in the Recession

February 26, 2009

If my last blog post is any indication, the March 2 issue of Fortune magazine is a goldmine of stories about the importance of marketing during this recession. Another article from this issue, “Baseball Battles The Slump”, caught my eye, about how the Arizona Diamondbacks keeps its fans loyal during these hard times.

According to the article, when a longtime season ticket holder e-mailed D-Back CEO Derrick Hall, informing him she’d fallen on hard times and asked his help in helping her hold on to her season tickets, Hall personally phoned her and arranged for her to share her season tickets.

In addition, with Phoenix having the lowest per-capita income of any Major League Baseball city, Hall wanted to insure the Diamondbacks retained the loyalty of their lower-and middle-income fans, instituting “kid’s pricing” for hot dogs and other concessions, and having pro shops where fans can buy D-Backs merchandise for about one-third of what other MLB teams charge.

What really impressed me was that when dining out, Hall picks up the tab of family whose youngster is wearing a D-Back’s hat; how Hall gives away free tickets to local schools; and that he praises players who mingle with fans before games and sign as many autographs as possible.

Hall demonstrates five valuable marketing principles we must never forget:

  • Know your customers;
  • Listen to your customers;
  • Appreciate your customers;
  • Instill a customer appreciation orientation in your employees; and
  • Give your customers a great experience along with a great product or service.

These principles work in any economy, but companies who continue to practice them during the recession will really score a home run!