michael kors - sustaining growth in a slowing luxury market

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December 2015 Sustaining Growth in a Slowing Luxury Market Michael Kors

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Page 1: Michael Kors - Sustaining Growth in a Slowing Luxury Market

December 2015

Sustaining Growth in a Slowing Luxury Market

Michael Kors

Yasya Goretsky
For this one, we only need to show that MK revenue is growing, I dont think we need anything else.
Page 2: Michael Kors - Sustaining Growth in a Slowing Luxury Market

Summary• Market reality --Increased competition and homogeneity• Michael Kors’ brand perception• Need promotional strategy to regain growth in revenue

Page 3: Michael Kors - Sustaining Growth in a Slowing Luxury Market

Data on Market growth

Page 4: Michael Kors - Sustaining Growth in a Slowing Luxury Market

Michael Kors Financial Summary

2010 2011 2012 2013 2014 2015 20160

500,000,0001,000,000,0001,500,000,0002,000,000,0002,500,000,0003,000,000,0003,500,000,0004,000,000,0004,500,000,0005,000,000,000

Michael Kors Global Revenue

MK Revenue

Year

$508M

$4.37B

Page 5: Michael Kors - Sustaining Growth in a Slowing Luxury Market

2011 2012 2013 2014 2015 20160.0%

20.0%

40.0%

60.0%

80.0%

MK Rev-enueGlobal Market

Year

• Growth leveling off • Michael Kors growth

rate is slowing but is still strong at 32% in 2015

Michael Kors Growth Rate versus Global Market

$4.37M

$1.3B

Page 6: Michael Kors - Sustaining Growth in a Slowing Luxury Market

Michael Kors’ Internal truth• Classic aesthetic designs with utility at a value • Staple accessories - not statement pieces• Accessible - Online, Department Stores, Independent

Retail Stores, Outlets• Versatile Product Lines - Apparel, Watches, Shoes,

Fragrances, Bags, Accessories, Leather Goods• Two brands – Luxury and Affordable luxury

Page 7: Michael Kors - Sustaining Growth in a Slowing Luxury Market

“Everything for everyone” - Michael Kors

Page 8: Michael Kors - Sustaining Growth in a Slowing Luxury Market

What do you think people is thinking about you

when you are wearing Michael Kors?

Basic Bitch

Page 9: Michael Kors - Sustaining Growth in a Slowing Luxury Market

Customer Insights• It is everywhere - ubiquitous --“they are always on sale at some place like the Macy’s, feels like they are a little bit cheap.” --“loses value when it’s sold in stores Like Ross” --“designs always look the same”• “Status Quo” Designs • Discounts cheapen the brand

Page 10: Michael Kors - Sustaining Growth in a Slowing Luxury Market

Turning Perceived Weaknesses into Strengths• It is everywhere - It’s easily available for purchase.• Status quo design - Never goes out of style. • Where do you wear Michael Kors? - “everywhere,” “work”

“The watches I wear on a daily basis.”• Discounts cheapen the brand - No need! The core customer

loves the brand! “feels more professional, more put-together, feel like I’m dressing nicer”

Page 11: Michael Kors - Sustaining Growth in a Slowing Luxury Market

Desired Customer• Female 25-35• College graduate in her early career• Aspirational young professional who wants her

look to transition seamlessly from day to night• Purchase Power

Page 12: Michael Kors - Sustaining Growth in a Slowing Luxury Market

Women that embody the Michael Kors customer

Kate MaraZoe SaldanaOlivia Wilde

Page 13: Michael Kors - Sustaining Growth in a Slowing Luxury Market

Campaign Target Objective

• Stop decline in growth • Target $1.4B increase

in revenue over last year.

• Achievable within MK growth trajectory.

2010 2012 2014 2016 20180.0%

10.0%20.0%30.0%40.0%50.0%60.0%70.0%80.0%

MK Growth Rate (Projected)

MK Revenue

Global Market

Year

$5.76B$4.38B

Yasya Goretsky
this needs to show the 32 percent increase from 2014 to 2015 AND 2016. 4.37B + 1.4 billion = 5.77B
Shiyuan Ceci Zhang
Show 32% increase to $5.77B in 2016
Page 14: Michael Kors - Sustaining Growth in a Slowing Luxury Market

So, what’s the one thing that makes Michael Kors stand above the crowd?

Michael Kors offers professional and timeless pieces that can transition from daytime office meetings to social events. A classic - yet affordable brand.

Page 15: Michael Kors - Sustaining Growth in a Slowing Luxury Market

Q & A