Look anywhere this winter and chances are you can see someone wearing canada jacka, parka, or vest. The Canadian-based clothing retailer continues to be so successful at marketing its puffy, doughboy jackets as elite winter wear that they’re one of several season’s most favored brands. The company’s parkas, identified by the round, two-inch patch about the left sleeve and the coyote fur-trimmed hood, once warmed arctic explorers and Canadian Rangers, these days are generally spotted on celebrities like Emma Stone. Recently, like North Face fleece jackets and L.L. Bean bean boots, the white goose down-filled jackets are becoming loved by college students.
What sets Canada Goose besides other outerwear companies are its exorbitant prices-$745 for any women’s coat, $245 to get a hat at Bloomingdales. Prices will go as much as $1,700.
But those steep prices haven’t hurt business a lttle bit. Fortune magazine reports that over the past decade, Canada Goose has seen revenues explode from $5 million to a lot more than $200 million, with a few experts predicting that figure could rise to $300 million by the end of the year.
Component of Canada Goose’s success may be attributed to playing up its humble founding five decades ago in a small warehouse in Toronto (the outerwear remains made in Canada). And when private equity firm Bain Capital acquired a majority stake in the company in 2013 for a rumored $250 million, it were required to promise to keep the manufacturing there.
Canada Goose is a marketer’s dream, says Susan Fournier, School of Management Questrom Professor in Management and faculty director in the 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 brand and the ways it provides formed relationships with its customers.
BU Today: Exactly why is Canada Goose this type of popular brand today?
Fournier: I don’t have their own marketing plan before me. All I am aware is their marketing comes from grassroots. They had a strong narrative, and after that it started getting acquired by certain groups. People started to contemplate hardcore Canadians braving the cold, so it was a fad and after that transitioned coming from a fad in a strong brand. I do believe it’s mostly with that and keeping prices high, not going crazy with sublines like making lighter fall jackets, for instance. Also protecting distribution hence they don’t show up for much less store like TJ Maxx or even an outlet. It’s that, being smart enough to not kill it.
So you’re stating that some brands damage what they have by expanding too quickly?
I feel that’s the truth with plenty of things. Burberry has come back now in popularity, however they were at an increased risk for a time, and the same thing was true with Calvin Klein. They made their brands too available. If you’re gonna be exclusive, availability-both distribution and pricing-is the opposite of that, so you have to balance that tension really carefully.
Within a marketing strategy, you have the four Ps: product, place, price, and promotion. The pricing and the distribution are the most significant to get a brand like this. It’s growing, everyone wants it, so it’s hard to say, “Well, we’re not going to make it readily available for everyone,” because you always want to serve shareholders and make the greatest profit.
Is price the key barrier for accessibility?
I believe distribution, too. Barriers to accessibility would be also, “Can you get your hands on it?” You need to work a bit harder to discover it. This brand has exclusive distribution; it’s not everywhere. Those are two barriers.
There’s plenty of hardy outerwear around-L.L. Bean, North Face, Patagonia. How have those brands convinced people that winter gear is fashionable or even a luxury item?
That’s interesting too. The North Face has grown hundreds and a huge selection of percent over recent years, plus they could risk blowing the whole thing up. But people are still to their ultra down coats, so they continue to be hanging in there. But they’re sort of at this close edge.
Sooner or later, several of these brands were only present in small communities, like L.L. Bean was previously for fishermen and hikers, but they broadened. I believe that’s the first step; you begin to shift the category frame that you think of this as. It’s easy-core expedition wear, it’s about outer fashion. Outerwear is still outerwear, however you don’t will need to go upon 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 they managed to get about fashion. They told customers when they got a new Swatch watch, it had been actually like that they had 10 watches due to interchangeable bands. Same with eyeglasses. You once had one pair, and now people usually have several with various designs.
Then it’s element of a trend that folks are willing to pay more for. Everyone is paying more permanently quality things on the whole. Consider the iPhone being a great example. Who within their right mind goosejacka to invest $800 over a phone? But we’re succeeding enough as being an economy, and it’s become a little easier for several people.
How about the backstory for brands like Canada Goose? Will it be important to form a narrative around a brandname to achieve success?
Over these narratives you feel like you can be aware of founder as a person. They’re adventure seekers. It’s the same with Patagonia and L.L. Bean. I believe that’s a huge factor. Maybe more in contemporary consumption, even more so in past times 10 or twenty years, this concept of a narrative is essential. There are so many brands out there that if you don’t use a story, along with a character inside your story, you’re behind. Like in your English classes, you require a character and a plot to produce a good story.
Using a story differentiates you and also gives your brand authenticity, that is crucial for brands today. Harley Davidson is a good example-they already have this founder myth. The founders of Snapple were hugely essential for getting Snapple off the floor; they were window washers. If you dig into some of your top brands, they all have these mythologies. And so they get some credentials with regards to authenticity.
Canada Goose doesn’t do a great deal of advertising; it relies instead on product placement in movies and word-of-mouth. What’s so effective about this type of advertising?
That’s sort of the things i was returning to. The sweetness 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 desire your brand to naturally become portion of the culture-quite simply, placing the merchandise into the audience that you would like it to gain traction.
The procedure is that you simply make an effort to get individuals to take advantage of the product and focus on it making use of their friends. That’s not in the hands of the marketing team; that’s in the hands of the consumers. It’s considerably more powerful and credible, considerably more approachable. You need to become a part of culture. If you become part of culture, then you can find right into a movie using a scene in which the characters will be in a really cold climate. Hollywood wants brands which are hot since they convey a lot of meaning, and yes it keeps going. People who are fashion bloggers want the manufacturer because it’s something which keeps going. It has authenticity; it’s not likely to seem commercial, and it’s not pushing an item.
Why has Canada Goose chose to concentrate on the college market?
I don’t know the response to that without seeing their marketing plan. I could see teens like a target; I don’t determine if it’s just college. Nevertheless, you figure students might have the capacity to afford these matters, and this it’s an effective potential audience, one that’s hip. They’re not targeting youngsters.
A BU student made a parody patch and raised cash on Kickstarter to manufacture the patches. Does Canada Goose make use of parodies that way?
It all depends on the parody, but 80 percent of parodies are form of good. If they’re selecting your main message, and discrediting you, that’s probably a bad idea. For instance, Matthew McConaughey did several Lincoln car spots, and other people made parodies that hit a touch too close to home.
But use the case of Snuggie. Those blankets were offered on infomercials, then the parody world got ahold of those, and plenty of parody commercials got loaded onto YouTube and that’s when that brand went nuts. A brandname wants men and women to accept them as an element of today’s cultural fabric.
Every brand wants to have this system everyone wants, so the challenge would be to make it cool. The test for Canada Goose will likely be coming up, and let’s see if they can ride this wave rather than kill it.