Look anywhere this winter and then chances are you can see someone wearing canada jacka, parka, or vest. The Canadian-based clothing retailer has been so successful at marketing its puffy, doughboy jackets as elite winter wear that they’re one of the season’s most in-demand brands. The company’s parkas, recognized by the round, two-inch patch on the left sleeve along with the coyote fur-trimmed hood, once warmed arctic explorers and Canadian Rangers, but today are commonly spotted on celebrities like Emma Stone. Recently, like North Face fleece jackets and L.L. Bean bean boots, the white goose down-filled jackets have become popular among college students.
What sets Canada Goose besides other outerwear companies are its exorbitant prices-$745 for a women’s coat, $245 for a hat at Bloomingdales. Prices can go as much as $1,700.
But those steep costs haven’t hurt business somewhat. Fortune magazine reports that throughout the last decade, Canada Goose has seen revenues explode from $5 million to greater than $200 million, with a few experts predicting that figure could rise to $300 million at the end of this year.
Element of Canada Goose’s success might be attributed to playing up its humble founding five decades ago in a small warehouse in Toronto (the outerwear remains to be produced in Canada). And when private equity firm Bain Capital acquired a majority stake in the company in 2013 to get a rumored $250 million, it had to promise to hold the manufacturing there.
Canada Goose is actually a marketer’s dream, says Susan Fournier, School of Management Questrom Professor in Management and faculty director of your MBA Program. Fournier invented a subfield of advertising on brand relationships and researches how companies create value through their branding.
BU Today spoke with Fournier about Canada Goose’s ultrasuccessful logo and the methods it has formed relationships with its customers.
BU Today: How come Canada Goose this sort of popular brand at this time?
Fournier: I don’t their very own marketing plan in front of me. All I realize is the fact their marketing emanates from grassroots. They had a robust narrative, then it started getting found by certain groups. People started to take into account hardcore Canadians braving the cold, and so it was a fad after which transitioned from the fad into a strong brand. I think it’s mostly about this and keeping prices high, not losing their mind with sublines like making lighter fall jackets, for instance. Also protecting distribution so that they don’t turn up for much less store like TJ Maxx or perhaps an outlet. It’s that, being smart enough to not kill it.
So you’re proclaiming that some brands damage the things they have by expanding too fast?
I believe that’s the situation with a great deal of things. Burberry has come back now in popularity, however they were in peril for a while, and the exact same thing was true with Calvin Klein. They made their brands too available. If you’re will be exclusive, availability-both distribution and pricing-is definitely the complete opposite of that, so you need to balance that tension really carefully.
In a marketing campaign, you will have the four Ps: product, place, price, and promotion. The pricing along with the distribution are the most important for a brand like this. It’s growing, everyone wants it, so it’s difficult to say, “Well, we’re not intending to make it available for everyone,” as you always wish to serve shareholders and make the largest profit.
Is price the principle barrier for accessibility?
I feel distribution, too. Barriers to accessibility would additionally be, “Can you get hold of it?” You have to work a little bit harder to find it. This brand has exclusive distribution; it’s not everywhere. Those are two barriers.
There’s lots of hardy outerwear out there-L.L. Bean, North Face, Patagonia. How have those brands convinced folks that winter gear is fashionable and even a luxury item?
That’s interesting too. The North Face has exploded hundreds and numerous percent over recent years, plus they could risk blowing the whole thing up. But people are still to their ultra down coats, hence they will still be hanging within. But they’re form of in that close edge.
Eventually, a number of these brands were only located in small communities, like L.L. Bean used to be for fishermen and hikers, but then they broadened. I believe that’s step one; you start to shift the category frame that you think of this as. It’s not difficult-core expedition wear, it’s about outer fashion. Outerwear remains outerwear, however, you don’t need to go upon an arctic expedition anymore.
The first task is transitioning the manufacturer to fashion. Remember Swatch? The innovation in Swatch was that watches was previously about timekeeping, and then they caused it to be about fashion. They told customers that when they purchased a Swatch watch, it was actually actually like they had 10 watches due to the interchangeable bands. Same task with eyeglasses. You used to have one pair, and today people usually have several with different designs.
Then it’s a part of a trend that individuals are prepared to pay more for. Individuals are paying more once and for all quality things generally. Glance at the iPhone as a great example. Who inside their right mind goosejacka to pay $800 on a phone? But we’re doing well enough being an economy, and it’s become easier for many people.
What about the backstory for businesses like Canada Goose? Could it be important produce a narrative around a product to reach your goals?
During these narratives you are feeling like you can are aware of the founder like a person. They’re adventure seekers. It’s exactly the same thing with Patagonia and L.L. Bean. I think that’s a huge factor. Maybe more in contemporary consumption, more so in the past 10 or twenty years, this idea of any narrative is vital. There are many brands around that in case you don’t have got a story, as well as a character within your story, you’re behind. Like in your English classes, you will need a character plus a plot to generate a good story.
Possessing a story differentiates you and gives your brand authenticity, that is crucial for brands today. Harley Davidson is a superb example-they may have this founder myth. The founders of Snapple were hugely necessary for getting Snapple off the ground; these folks were window washers. If you dig into several of your top brands, each one has these mythologies. And they also incorporate some credentials in relation to authenticity.
Canada Goose doesn’t do lots of advertising; it relies instead on product placement in movies and word-of-mouth. What’s so effective about that kind of advertising?
That’s sort of the things i was getting back to. The wonder is they don’t have got a marketing strategy with a capital M, meaning traditional stuff. Instead, they’re doing cultural branding. Cultural branding means you want your brand to naturally become portion of the culture-to put it differently, placing the products in to the audience in which you want it to gain traction.
The process is you try and get people to take advantage of the product and talk about it because of their friends. That’s not at the disposal of the marketing team; that’s at the disposal of the consumers. It’s a lot more powerful and credible, far more approachable. You wish to become a part of culture. If you become component of culture, then you can find in to a movie using a scene the location where the characters are in a really cold climate. Hollywood wants brands that happen to be hot simply because they convey lots of meaning, and yes it keeps going. Those people who are fashion bloggers want the brand because it’s something that keeps going. It offers authenticity; it’s not planning to seem commercial, and it’s not pushing a product.
Why has Canada Goose decided to concentrate on the college market?
I don’t know the response to that without seeing their marketing plan. I really could see teenagers like a target; I don’t know if it’s just college. However, you figure students might are able to afford these things, and therefore it’s an effective potential audience, one that’s hip. They’re not targeting youngsters.
A BU student developed a parody patch and raised cash on Kickstarter to manufacture the patches. Does Canada Goose reap the benefits of parodies like this?
It all depends around the parody, but 80 % of parodies are form of good. If they’re opting for your primary message, and discrediting you, that’s probably not a good idea. For instance, Matthew McConaughey did a series of Lincoln car spots, and folks made parodies that hit a little too near to home.
But consider the case of Snuggie. Those blankets were for sale on infomercials, then this parody world got ahold of which, and tons of parody commercials got loaded onto YouTube and that’s when that brand went nuts. A product wants individuals to accept them as part of today’s cultural fabric.
Every brand would like to have the product that everyone wants, therefore the challenge would be to ensure that is stays cool. The exam for Canada Goose will probably be coming up, and let’s see when they can ride this wave rather than kill it.