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Michael Kors Holdings: How to design a winning growth strategy - Product Image

Michael Kors Holdings: How to design a winning growth strategy

  • Published: January 2013
  • 26 Pages
  • MarketLine

Introduction

Michael Kors operates in the luxury end of the fashion and retail sector. It engages in the design, marketing, distribution, and retail of branded goods. The company started as an American luxury sportswear house in 1981, and in about 30 years transformed into the global luxury accessories, footwear and apparel brand, with a global presence and stores in most prestigious cities in the world.

Features and benefits

- MarketLine Case Studies describe topics such as innovative products, business models, and significant company acquisitions.
- Fact-based and presented in an accessible style, they explain the rationale of commercial decisions and illustrate wider market and economic trends

Highlights

- The global luxury goods retail market, worth $226.6bn in 2012, continues to create growth opportunities. It is expected to grow at a compound annual growth rate (CAGR) of 7.8% towards 2014. Growth is primarily driven by leather goods, shoes, accessories and jewelry & watches categories. Asia was the fastest growing luxury market in 2012.
- Accessories and footwear generate most of Michael Kors' sales and appeal to a wide variety of demographics; READ MORE >

OVERVIEW
Catalyst
Summary

GLOBAL LUXURY GOODS MARKET CONTINUES TO CREATE GROWTH OPPORTUNITIES
Global retail sales of luxury goods increased in 2012
Luxury goods market is expected to grow strongly towards 2014
Leather, shoes and accessories are driving luxury sales
Asia was the fastest growing luxury market in 2012
Luxury market is cyclical and dependent on consumer spending habits
Fast response to changing fashion and retail trends is essential
Luxury fashion competitive landscape

FROM A SPORTSWEAR HOUSE TO GLOBAL LUXURY BRAND
Michael Kors - luxury retailer present in the most prestigious cities in the world
From a luxury sportswear house to a global accessories, footwear and apparel brand
Combining elegance with sporty attitude to target wealthy consumers of all age group
Kors brands target a broad customer base, keeping luxury image at the same time
Kors' collections prices range from $20 to $4,000
Kors collections are carried in leading department stores throughout the world
Retail segment generated a majority of Kors' business in 2012
Kors had a total of 237 retail stores, with 71 open in 2012
Kors wholesale segment reached 2,677 department and specialty stores in 2012

GROWTH DESPITE SLUGGISH ECONOMY
Despite sluggish economy Kors is growing its revenues at a double digit rate
Robust revenue growth in all channels
North America is Kors' largest market, generating vast majority of retail and wholesale business
European sales increased at a triple digit rate in 2012
Revenues from Japan increased by $9.2m in 2012
Kors is targeting younger affluent demographics
Kors' number of stores increasing at a double digit rate
Kors spending on advertising up by 14.6% in 2012
Omni channel approach and innovation are important elements of Kors' marketing
Responsive design system to capitalize on 425 million smartphone Facebook visitors a month
Kors marketing efforts resulting in huge y-o-y Facebook fan base growth

CONCLUSIONS
Multi-channel growth strategy and successful brand management
Successful penetration of new geographical markets and reach for wider audience

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