CONTENTS PAGES 4 - 5 - Executive Summary and Introduction. PAGES 6 - 7 - Prada Timeline. PAGES 6 - 7- Brand Equity and Visual Identity. PAGES 10 - 11 - Marketing Mix. PAGES 12 - 13 - Consumer Segmentation. PAGES 14- 15 -Emerging Markets. PAGES 16 - 17 - Competitor Analysis. PAGES 18 - 21 - Micro and Macro Economic Factors. PAGES 22 - 23 - SWOT Analysis. PAGES 24 - 25 - Reccomendations. PAGES 26 - 29 - Bibliography.
EXECUTIVE SUMMARY... Sophisticated. Avant-garde. Traditional. Italian. PRADA. One of the biggest global luxury fashion brands whose presence we have been graced with since 1913. It all began then with leather goods and brothers Mario and Martino Prada; two Milanese craftsmen. From the offset, the Prada brand endeavoured to attract the most refined, tasteful clientele. To this day, these initial attributes of a Prada customer have not altered. Only trends and immense success have changed since then.
INTRODUCTION... Perhaps in 1919, a short 6 years after the company was founded, the Prada brothers realised the brands potential. It was then that Prada became the first official supplier to the Italian Royal Household. After this great step towards success, Prada incorporated the House of Savoy’s coat of arms and knotted rope design into its logo. From then onwards, the Milanese elite were captivated by the Prada brand. It was established and continued to expand. The Group then saw a turning point in the development of its activities at the end of the Seventies, when Miuccia Prada, Mario Prada’s granddaughter, launched a partnership with Tuscan businessman and soon to be husband Patrizio Bertelli. (Pradagroup. com) Miuccia Prada’s fresh, innovative mind meant that Prada was to be re-invented as a brand. This partnership
was destined for success from the very beginning. With Miuccia Prada’s avant-garde and creative approach to fashion, and Patrizio Bertelli’s key business knowledge and experience, they had the foundations to make the brand of Prada an international extravaganza. Much of what set Miuccia Prada apart from the rest of the fashion world is her seeming disregard for the fashion industry. From 1978, Prada has always demonstrated a fearlessness in trying new styles. (www.biography.com) Before Prada took over the already established but slowing business that her grandfather had built up over many years, the Prada brand ultimately sold high end leather goods to the higher class. Miuccia Prada’s vision was different. She wished to inject new life and ultimately a whole new product range into the brand, re-invent-
ing it for the better whilst the culture, art and Italian heritage remains key to her branding and designs. Although Mario Prada saw no place for women within the workplace, wishing for his son to takeover the business, this responsibility fell into the hands of his youngest granddaughter. Miuccia had no previous fashion experience, but had a PHd in political science, making her an intelligent individual aware of the world around her. Her knowledge on the world perhaps aided her in regards to the do’s and don’ts within the fashion industry. It has indeed helped her make correct business decisions, whereby Prada has remained one of the most recognised brands in the world. It was in 1988 that Miuccia Prada presented her first Womenswear
collection at Prada’s headquarters in Milan. This was a time when Mrs Prada was recognised for her creative talent and ability to create a collection that was simplistic yet effective in its portrayal. “For me, all my shows are super sexy…For me, a beautiful woman with a bias dress with diamanté is the least sexy woman alive. I hope, also, to some men.” (www.thecut.com) This particular show determined what the style of Prada was to be ; classic, sophisticated, traditional yet avant-garde in its approach to fashion.
1977 - Miuccia Prada and Patrizio Bertelli started their partnership at Prada.
1919- Prada become official supplier to Italian Royal Household - incorporate Royal arms into logo.
1983 - Second Prada store opened in Via De la Spiga, Milan.
1913- The Prada brothers founded a luxury goods shop in Milan known as Fratelli Prada.
1950- Prada announced its launch of a new type of nylon.
1984- Due to l sales, Prada re nylon bags th sembled silk.
1985 - Classic 1988- First Prada handelapparel colbag.
2005 - Short film “Thunder Perfect Mind” 1995 - Designer at Berlin film festival.
of the Year award for Prada.
1998- Prada sales at $31.7m and first menswear campaign.
2010 “Prada Made In”
2017- Prada 365 launched.
1997- Sponsorship of “Prada challenge for America’s Cup 2000.
low eleased hat re-
1986- Globalisation- stores in NYC, London, Madrid, Paris
1993- Launch of Miu Miu and Fondazione Prada.
2007 Launch of the Prada phone by
2000- Optical eyewear and sunglasses collection.
2014- Tax invasion investigation.
Brand Equity and Visual Identity...
Prada’s brand essence is its ability to take their apparel and accessory collections and portray history and current social trends and issues through them. As a brand, Prada stands for freedom of choice for women through a sophisticated but sexy style of dress. Considering the brand as a person, this individual would be professional, sure of themselves and their decisions, someone able to have fun but remain sophisticated. Additionally, they appreciate the arts in all of their beauty and realism. They appreciate nature and tradition, culture and history. As an organisation, Prada delineate an aesthetic and cultural relevance, transcendence of pure commerce to the world of art, technology, architecture, and focus on consumer dialogue through retail experience. All of these elements have helped Prada to become one of the most ambitious and trendsetting global luxury brands of modern days. (link.springer.com) In order to achieve the very established brand image that they have today, Prada have worked globally in order to gain market power within the luxury fashion sector; successfully they have done so. Prada take great pride in the cultural value of the physical buildings and factories; The Prada Group’s headquarters are spaces where eclecticism of ideas transforms into activities. The buildings preserve people’s creativity and manufacturing stories within their walls. (www. pradagroup.com) In regards to the brands that Prada own such as Church’s, they have maintained the core attributes of the brand; all things British heritage and tailoring. This proves as a brand Prada were not scared to venture into new markets, or change the brands that they acquire to suit the image of Prada.
to portray. Her ability to look at the world from an unconventional vantage point allowed her not only to anticipate but, quite often, to set new trends (csr. pradagroup.com) which has been especially useful for the brand as although some may say that Prada collections verge on ugly, Mrs Prada can get away with it. “If you want to know what a season is about, you don’t miss the Prada show,” one fashion director told TIME magazine in 2004. “She never follows anyone else’s lead, just her own original energy. Her collections are completely an expression of herself.” (www.biography.com) Ultimately, therefore, Prada’s product is Miuccia Prada herself. It could be suggested that Prada symbolises the contrast between what society could be and what it is. Throughout their collections, hard chic, ugly chic and naïf chic are techniques used by Prada’s design team. These styles may have been used to represent the contradictions within society – what is beautiful? What is sexy? What is fashion? For example, in the Prada 365 SS18 Black Nylon campaign, there is a contrast between youth and sophistication, practicality and glamour. This particular advertisement signifies Prada’s ability to experiment with clothing in a way that embodies current and historical societal trends.
Considering the brand as a product, you would be unable to ignore the overpowering smartness and sophistication that is evident from the offset with Prada products. The brand oozes quality. All apparel, handbags and footwear are made with precision. Tailoring is perfected. Miuccia Prada obviously been a huge influence on the style that the business aims
MARKETING Product: Prada is perhaps mostly recognised as a brand who’s products ooze elegance, sophistication, innovation and luxury. Their product portfolio is large, ranging from apparel to fragrance. This means that the typical Prada man or woman can live a whole ‘Prada lifestyle’. They are able to have a complete wardrobe of Prada, meaning that Prada themselves are present in all of the branching markets within the fashion sector. Their products for women seem to be aimed at females aged 25 to 40 who wish to express their personal and professional successes through dress. They will most likely be middle class career led women who have a high amount of disposable income to spend on Prada’s high priced items. Males who purchase Prada’s products are also the sophisticated and smart kind who wish to portray their status, class and lifestyle through the quality of their luxury clothing. Prada’s menswear apparel and accessories could be viewed as tradition with a twist. Furthermore, the males who wear/use Prada products must be confident in themselves and their style.
Place: Aestheticism, art and culture are what Prada take pride in when it comes to their physical stores. The buildings that they distribute their high-quality products from are rich in history and relevance to their subject matter. Due to Miuccia’s personal interest in the arts, the sites selected by the Prada group – either historic buildings, recovered industrial sites or cutting-edge constructions – represent an example of corporate philosophy that perceived the workplace as a space where history, culture, nature and respect for people combine generating architectural solution with a strong identity (www.pradagroup.com) Operating in 75 different countries means that there is a vast range of buildings and retailers that sell Prada. Some of these places are Prada stores themselves, NetA-Porter, Selfridges, Harvey Nichols, House of Fraser, My Theresa, Macy’s. These are all stores that sell premium and luxury brands, therefore they are trusted by Prada to sell their products well and appropriately.
MIX Price: High brand value and a renowned strong brand image is reflected in Prada’s premium prices. They are able to charge high prices for their apparel, accessories and services as they are one of the biggest luxury fashion houses in the world. Consequently, they have repeat purchases and customer loyalty. People will also be more likely to confidently purchase from the company as they use a product line pricing strategy. This is the process used by retailers of separating goods into cost categories in order to create various quality levels in the minds of consumers. Effective product line pricing will usually involve sufficient price gaps between categories to inform prospective buyers of quality differentials www.businessdictionary.com) which Prada clearly do. Their handbag and leather goods, perhaps their most recognised product out of their vast range, are priced from £440 to £13,800. Automatically we, as consumers, are faced with an image of high quality due to this price range. However, their women’s fragrance and men’s aftershave prices range from £44 to £195. To remain competitive against existing and current rivals within the industry, Prada need to sell some products at fairly lower prices. Higher levels of brand recognition will come from this. Their prices do, on the other hand, give an impression of lower quality for consumers who are interested in the Prada brand but do not have enough disposable income to indulge in their other premium products.
Promotion: Like many of their competitors, Prada mainly use social media to promote their new products, collections and overall brand. This is imperative as at a time when social media has increased demand as fashion trends are delivered to consumers at a faster pace than ever before, Prada need to be on the ball to remain not only competitive, but current in the fast changing fashion industry. Being the renowned luxury clothing brand that they are, Prada are at the heart of the catwalk and can be seen globally at LFW, PFW, MFW and NYFW. This assures Prada that their products are being broadcasted around the world, in every high-end fashion magazine and to every major fashion influencer/icon of the moment. Numerous short-films or ‘Cinematographic experiments’ have been directed and produced for Prada by some of the most famous film makers in the world. These were created in order to connect with the consumer on an emotional level. They allow their products to be interpreted in different ways. It has proved a successful promotion strategy, setting Prada aside from their competitors. It also proves to the consumer that they are more than just a fashion brand.
CONSUMER SEGMENTATION... Prada is not necessarily for the many, it is for the few. For professional, luxury seeking, money wearing individuals, Prada is the answer. If you own a Prada item, you are likening yourself to their ethos as a brand. This tends to be that good clothes are not only the answer to your problems, but the solution. If you are happy in a wellpaid occupation and you are constantly striving for more, Prada advertisements tend to capture your attention. Their collections verge on twisted tradition, therefore mature, professional consumers who wish to be bold in their actions but remain sophisticated
tend to be Pradaâ€™s main target audience. In regards to psychographics, these individuals want more than just clothing. They look for meaning in their choices, whether that be personal, professional or fashion related. Prada is a brand with substance and history. Each item designed and manufactured is made with purpose, and this is attractive to consumers who aim to work to their full potential. When wearing Prada clothing or accessories, consumers are portraying a message to the world around them that they have a life with potential and worth. Prada targets the
wealthy middle and upper class of society, with high disposable income and the desire to dress chic yet contemporary This has, however, changed considerably over the decades since 1913 when Prada was simply a luggage and leather company. Their target audience then were the rich and elite of Milan, whereas now the fashion house targets men and women globally. The brand oozes class and quality, two factors which do not come at a cheap price. According to Maslowâ€™s Hierarchy of Needs, Prada consumers will have reached their Esteem Needs stage.
They are fully satisfied within their work, family and social situation. In a fairly materialistic manner, Prada consumers will now expect respect from their peers and those around them. Once gained, they will be on their way to completing their Hierarchy of Needs, consequently reaching the Self Actualisation stage. This is of importance for Prada consumers as they are confident individuals who wish for nothing but the best for themselves.
COMPETITOR ANALYSIS... According to the McKinsey Global Fashion Index 2018, 55% of customers buy clothing due to online reviews and a large 74% buy due to social media influence.(cdn. businessoffashion.com) These are great figures, outlining that the fashion industry is now nothing without the internet. Prada, therefore, are nothing without an online presence. One of Prada’s main competitors is Gucci. With a similar brand essence and personality, the Italian led brands are both at the top of the fashion industry. Gucci, however, are experiencing a phase of extreme popularity and recognition across the globe. Their choice to connect with not only Millennials, but Generation Z; a generation of teens who are slowly but surely building their own momentum, are set to make up 33% of the global population by 2020 (www.lsnglobal.com) Prada and Gucci do share similar characteristics in that they are both high priced, luxury fashion houses from Italy. However, Gucci’s target market are perhaps slightly younger than that of Prada’s. This is not necessarily a bad thing for Prada, however in order to remain competitive, Prada have introduced Prada 365 - promising something nimble, timely, immediate and proactive. Enabling Prada to fully exploit their huge product offering through so many more stories than the ones currently on view in the monolithic campaigns it runs each season.(www.businessoffashion.com)This is set to place Prada aside from competitors as it is a completely new convention and hopefully a successful strategy. Another of Prada’s competitors is French fashion house Hermès. Both brands are similar in brand essence and visual identity. They are greatly influenced by art and nature and specialise in leather goods. Hermès was established in 1837 and Prada in 1913. They simultaneously use this as their USP – putting their history and experience in the industry to good use. Prada, however, seem to connect with their consumers on a higher level than Hermès.
HIGH PRICE HIGH QUALITY
MICRO AND MACRO ECONOMIC FACTORS... Political The Prada Ready-to-wear Autumn 2016 show. On her catwalk, Mrs Pradaoffered her own vision of a polarised world: the powerful and the weak, the rich and the poor. A fur cape was duplicated seconds later in utilitarian cotton canvas. What looked like a surgical corset gripped a perfectly tailored coat. A brocade shirt was paired with a postcard skirt. (www.businessoffashion.com)These contrasts prove Miuccia Prada’s ability to use fashion as a tool to portray current issues, including political ones. As a strong, successful woman herself, Mrs Prada uses women as a muse for her political opinions. Due to the current feminist movement, fashion houses are using their huge industrial power to make a change in societal roles. Prada have always been a fashion house who believe that you don’t have to remove your clothes to be sexy. Their use of hard chic style of dress allows women to dress in any way they wish. Mrs Prada has always been a political animal, but her politics have rarely been obvious in her work. (www.businessoffashion.com) Prada was an unlikely inheritor of her family’s business. A former member of the Italian Communist Party, Prada attended the University of Milan, where she made a name for herself as an ardent feminist and earned a Ph.D. in political science. (www.biography.com) Furthermore, Miuccia Prada has always held politics close to her heart. This hasn’t always been apparent throughout Prada’s collections, however feminist references have remained. Brexit will certainly have implications upon the fashion industry. There is a deeper reason for the damage caused by Brexit, which is the breakdown of the symbolic link with Europe for luxury brands. This is because authenticity is pivotal to the value of luxury brands and is closely associated with three key elements, namely: 1. heritage and pedigree, 2. relationship to place, 3. method of production. Prada’s stock price also fell by 4% on the day of the vote. (www.internationalexcellence. co.uk)
Economic 2018 is predicted to be volatile and uncertain for the fashion industry. However, there is expected global interconnectedness. Opportunities will arise for Prada, meaning that this year could provide Prada with the incentive to become more competitive. In regards to sales, millennials, of whom Prada target, are price sensitive. However, they base more of their purchasing decisions on whether a companies practices and mission align with their values. For Prada, this means that they must assure that their actions are made with the consumer in mind. This will assure that sales will increase. The industry shows no signs of slowing as the market is projected to experience 5.91% yearly growth over the next three years. (fee.org/) As the industry is experiencing growth, certain fashion houses may slip under the radar if they do not maintain high sales. At a time of ambiguity within the fashion economy, Prada will need to be open to change. They will also need to assure that they have the customer loyalty to uphold the strength of their brand.
Social Society today is constantly changing. As is the way fashion is designed, manufactured and sold. Fast fashion has completely dominated the market and is continuing to do so. Sales of the traditional fast fashion sector have grown rapidly by more than 20% over the past 3 years. (cdn.businessoffashion.com) In regards to the luxury fashion sector, they are having to either lower prices or remain high end luxury in order to keep consumers interested. Millennials are becoming less brand loyal as a generation – discounted products are more attractive on the whole. As consumers are more price sensitive, this could negatively impact the luxury goods sector. Some brands such as Alexander Wang and Balmain have partaken in high street collaborations in attempt to remain current. These have been successful, however Miuccia Prada was not keen on this strategy for the company: “I have never even considered it and I’ve explained why,” she said. “It’s because I don’t like the idea of a bad copy of what one does for the main brand. If I had an ingenious idea to do fashion that costs less but that wasn’t a bad copy of something else, with completely different criteria and ways of doing things, I would do it...” (www. vogue.co.uk/)
Technological With social media expanding rapidly every day, Prada have recently been more proactive online. They have a large social media following and post updates on collections and celebrity endorsement. Due to this, they have become more competitive and relevant in the current fashion industry. A series of experiential and service-oriented features enhances both functioning and aura of the stores. The dressing rooms are equipped with `magic mirrors`: A plasma screen invisibly built into the large mirror surface that allows customers to see themselves both from the front and the back at the same time. An integrated time delay can even capture and replay movements. (oma.eu) On the web-site, the garment closet has its virtual counter-part, the `web-closet`, that contains a history of all pieces tried on. The customer can not only built up his personal history and selection of likes, but also order things he tried but didnâ€™t buy in the store. (oma.eu) The addition of these technological advances strengthen Pradaâ€™s brand image, providing customers with an alternative shopping experience.
Environmental The Fashion Transparency Index 2016 showed that Prada scored 21% out of 100% in regards to the transparency of the business. This means that Prada do not know where most of their suppliers get their raw materials from. Consequently, they are most likely having a negative impact on the environment without their own knowledge. Prada, however, are aiming to become more sustainable as a brand. Their website outlines their commitment to CSR, meaning that they are ready to improve the vast amount of negative impacts that the fashion industry has upon the environment. They state that they are committed to reducing the environmental impact of the firms activities, including â€“ reduction of land consumption, energy efficiency, use of renewable energy, and reduction of waste. (www.pradagroup.com) This suggests that Prada will become less profit driven and more responsible as a company.
Legal The captivating Prada Marfa art instillation designed by Michael Elmgreen and Ingar Dragset designed the piece to resemble a Prada storefront was deemed illegal in 2013. Built in 2005, the building was situated on private land in Valentine, Texas. (www.telegraph.co.uk) Although the store did not sell any Prada products, it was still a form of brand advertisement built without permission. Similarly to Dolce and Gabbana, Prada were examined over the accuracy of certain past tax filings by them as individuals in respect of foreign-owned companies. (www. bbc.co.uk) Prada and Bertelli paid more than 400 million euros ($429 million) to settle their tax positions, but under Italian law this did not stop a separate investigation by magistrates. (/uk.reuters.com) This was detrimental to their brand image and caused shares in the company to fall.
STRENGHTS: -Multinational fashion company recognised by all across the globe. -Extremely established brand image. -One of the market leaders of the luxury fashion sector – immense buying power and market dominance. -Large product portfolio including clothing, bags, shoes, accessories, sunglasses, perfume/ aftershave. -Unique heritage – the heavily inspired artistic and cultural background of Mario Prada, Miuccia Prada and Patrizio Bertelli. -Successful alliances with LG and Toyota. -Ownership of other successful brands such as Miu Miu, Church’s, Car Shoe, Pasticceria Marchesi, Luna Rossa, Fondazione Prada. -Successful acquisitions and mergers. -Miuccia Prada herself. -They have improved their website by a great deal and are taking advantage of social media and technology advances. -Differentiation in regards to the brands Prada own. -Mass appeal. -Celebrity endorsement.
OPPORTUNITIES: -E-commerce – it is difficult to find online shops that sell any other Prada products other than sunglasses and perfume/aftershave. -More innovative products – perhaps take advantage of the art and Italian culture behind the brand and make that the USP of Prada – distinguishable products to make them more competitive against the likes of Gucci and Chanel. -Capture the younger audience via social media platforms, especially Instagram – connect with socialites and models/fashionista’s of today that hold the same values as Prada but may also bring a fresh outlook to the brand and attract a younger, more avant-garde target audience through this endorsement. -Cosmetics product line.
ANALYSIS WEAKNESSES: -Private company – difficulty in regards to corporate debts within the company and finding the funds to resolve these issues. -A lack of innovation of their products on offer – apart from the heritage of the brand. -Becoming gradually less competitive against successful rivals such as Gucci and Chanel. -Who is Prada’s target audience? – difference in collections and styles each collection – difficult to estabish one certain type of customer.
THREATS: -If products are outsourced then the core brand values of Prada may not be followed – materials and heavy Italian influence may not be apparent if clothing is produced elsewhere. -Competitors – Prada need to decide on a vision for their brand- they have introduced Prada 365 in order to portray a more differentiated product line in a more fashion forward approach to keep competitive – Gucci are the brand of the moment – mainly because they have captured the younger target audience – but is this what Prada wishes to do? Especially when they pride themselves on tradition and art. If they wish to enter a new market like Gucci have, they may need to re-think their mission as a company- however if they do not they need to remain an exclusive, luxury brand, tailoring their advertisement to the professional, career driven man or woman that they always have. -The rise of fake Prada – counterfeit goods production is at an all time high and fakes are easily available.
-To become more competitive, Prada could branch out into cosmetics – although they already have a successful fragrance range, with Prada’s strong customer base and loyalty, if there was a makeup and skincare product line, Prada would be extending their target market. This will lead to an increase in sales and therefore profit. -Prada could further increase their use of social media platforms. In order to do this they could connect with consumers through Instagram, i.e. increased advertisement, cookies, live streams (possibly including celebrities and models), and product giveaways through comments. By doing so, Prada will be relevant in today’s ever changing fashion industry. They will also be speaking to Millennials and Generation Z. -An increase in sustainability of the brand would be useful in strengthening Prada’s brand image as a whole – although a section of the Prada Groups website is dedicated to CSR, it is not detailed in their actions, suggesting that they don’t actually work towards a sustainable future. Advertisement of their pro-sustainability actions, or a environmentally friendly campaign would establish Prada as a forward thinking brand.
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