Look anywhere this winter and then you can discover someone wearing goose 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 widely used brands. The company’s parkas, identified by the round, two-inch patch around the left sleeve and the coyote fur-trimmed hood, once warmed arctic explorers and Canadian Rangers, however nowadays are normally spotted on celebrities like Emma Stone. More recently, like North Face fleece jackets and L.L. Bean bean boots, the white goose down-filled jackets have become well-liked by university students.
What sets Canada Goose in addition to other outerwear companies are its exorbitant prices-$745 for the women’s coat, $245 for the hat at Bloomingdales. Prices can go as high as $1,700.
But those steep prices haven’t hurt business a bit. Fortune magazine reports that over the past decade, Canada Goose has seen revenues explode from $5 million to greater than $200 million, with some experts predicting that figure could rise to $300 million by the end with this year.
Element of Canada Goose’s success could be associated with playing up its humble founding five decades ago in a small warehouse in Toronto (the outerwear continues to be manufactured in Canada). And whenever private equity firm Bain Capital acquired a majority stake within the company in 2013 to get a rumored $250 million, it were required to promise to maintain the manufacturing there.
Canada Goose can be 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 promoting on brand relationships and researches how companies create value through their branding.
BU Today spoke with Fournier about Canada Goose’s ultrasuccessful brand name and the ways it offers formed relationships having its customers.
BU Today: Exactly why is Canada Goose this type of popular brand today?
Fournier: I don’t have their own marketing strategy looking at me. All I know is the fact their marketing arises from grassroots. That they had a solid narrative, after which it started getting acquired by certain groups. People started to consider hardcore Canadians braving the cold, and so it became a fad then transitioned coming from a fad in to a strong brand. I do believe it’s mostly about that and keeping prices high, not going crazy with sublines like making lighter fall jackets, for example. Also protecting distribution therefore they don’t show up at a discount store like TJ Maxx or an outlet. It’s that, being smart enough to never kill it.
So you’re stating that some brands damage whatever they have by expanding too quickly?
I think that’s the way it is with plenty of things. Burberry comes back now in popularity, but they were at risk for quite a while, and the same was true with Calvin Klein. They made their brands too available. If you’re will be exclusive, availability-both distribution and pricing-will be the opposite of that, so you will need to balance that tension really carefully.
In the advertising campaign, you have the four Ps: product, place, price, and promotion. The pricing along with the distribution are the most important to get a brand similar to this. It’s growing, everyone would like it, so it’s challenging to say, “Well, we’re not intending to make it available for everyone,” since you always want to serve shareholders to make the biggest profit.
Is price the principle barrier for accessibility?
I feel distribution, too. Barriers to accessibility would be also, “Can you get hold of it?” You will need to work a little bit harder to get it. This brand has exclusive distribution; it’s not everywhere. Those are two barriers.
There’s lots of hardy outerwear around-L.L. Bean, North Face, Patagonia. How have those brands convinced people that winter gear is fashionable and even a luxury item?
That’s interesting too. The North Face continues to grow hundreds and hundreds of percent over the recent years, and so they could risk blowing everything up. But folks are still within their ultra down coats, hence they continue to be hanging inside. But they’re sort of at that close edge.
Sooner or later, a number of these brands were only located in small communities, like L.L. Bean was previously for fishermen and hikers, but they broadened. I feel that’s step one; you start to shift the course frame that you think of this as. It’s not hard-core expedition wear, it’s about outer fashion. Outerwear is still outerwear, nevertheless, you don’t will need to go by using an arctic expedition anymore.
The initial step is transitioning the emblem to fashion. Remember Swatch? The innovation in Swatch was that watches had been about timekeeping, and then they caused it to be about fashion. They told customers that if they obtained a Swatch watch, it was actually like that they had 10 watches due to the interchangeable bands. Exact same thing with eyeglasses. You once had one pair, and from now on people often have several with various designs.
Then it’s component of a trend that individuals are likely to pay more for. Folks are paying more for good quality things generally speaking. Glance at the iPhone being a great example. Who with their right mind goosejacka to spend $800 on the phone? But we’re succeeding enough being an economy, and it’s become a little easier for several people.
What about the backstory for businesses like Canada Goose? Will it be important to form a narrative around a brandname to be successful?
In these narratives you really feel like you get to know the founder like a person. They’re adventure seekers. It’s the exact same thing with Patagonia and L.L. Bean. I think that’s a tremendous factor. Maybe more in contemporary consumption, more so before 10 or twenty years, this idea of the narrative is crucial. There are plenty of brands around when you don’t use a story, plus a character in your story, you’re behind. Such as your English classes, you will need a character along with a plot to make a good story.
Possessing a story differentiates you and also gives your brand authenticity, which can be critical for brands today. Harley Davidson is a good example-they may have this founder myth. The founders of Snapple were hugely necessary for getting Snapple up and running; these folks were window washers. When you dig into some of your top brands, every one has these mythologies. And they also have some credentials in terms of 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 with that type of advertising?
That’s sort of what I was returning to. The beauty here is they don’t possess a marketing plan by using a capital M, meaning traditional stuff. Instead, they’re doing cultural branding. Cultural branding means you would like your brand to naturally become portion of the culture-put simply, placing the items in the audience in which you want it to gain traction.
The procedure is that you simply try to get men and women to make use of the product and talk about it using their friends. That’s not in the hands of the marketing team; that’s in the hands of the consumers. It’s a lot more powerful and credible, considerably more approachable. You would like to become component of culture. When you become component of culture, then you might get in a movie with a scene where characters are in a really cold climate. Hollywood wants brands that are hot mainly because they convey a great deal of meaning, and it also keeps going. Those who are fashion bloggers want the company because it’s a thing that keeps going. It offers authenticity; it’s not planning to seem commercial, and it’s not pushing a product.
Why has Canada Goose chose to focus on the college market?
I don’t know the answer to that without seeing their marketing plan. I really could see adolescents as a target; I don’t determine it’s just college. Nevertheless, you figure college students might have the ability to afford these items, and this it’s an effective potential audience, one that’s hip. They’re not targeting youngsters.
A BU student launched a parody patch and raised money Kickstarter to produce the patches. Does Canada Goose reap the benefits of parodies such as that?
It all depends about the parody, but 80 % of parodies are type of good. If they’re opting for your main message, and discrediting you, that’s probably a bad idea. For example, Matthew McConaughey did some Lincoln car spots, and folks made parodies that hit a little too near to home.
But take the case of Snuggie. Those blankets were for sale on infomercials, then a parody world got ahold of which, and a lot of parody commercials got loaded onto YouTube and that’s when that brand went nuts. A brandname wants men and women to accept them within today’s cultural fabric.
Every brand desires to have the product that everybody wants, therefore the challenge would be to keep it cool. The test for Canada Goose will be coming, and let’s see when they can ride this wave and not kill it.