Our subject is very vast so in order to treat is as completely as we can, we have decided to analyse Prada’s problems and to compare them to other luxury brands. Also, we thought about how Prada, which, few years ago, was a fashion brand with a big “F”, which was so influential that it inspired one of the most popular films about fashion industry “the devil wears Prada” became a victim of everlasting problems. In the last part of our presentation, we were interested in the different strategies adopted by Prada and its’ competitors such as Gucci, or Chanel but we also brainstormed about the solutions the brand could take in …show more content…
On April 2016 Prada made its lowest profit in five years. It can be explained by various things. Over years Gucci encountered a lot of problems of different types, which made it more sensible as a company, but also executives didn’t take good decisions in time.
First, we can talk about their websites which were largely criticized from their creation. According to the customers, websites aren’t translated in enough languages and there is not enough information about the products. This problem is very important especially for a luxury brand where the products are very expensive and the customer are even more meticulous about the information they get. And even for products bought in stores, it is vital to have a complete overview of that same product online because more and more people do their researches online before going to actual store so if the description is bad, it makes company lose money of its potential clients.
Other particularly critical problem for Prada is their brand image which suffered a lot because of counterfeits. For this reason, some people see this brand as being too common and even cheap looking because of all the fake, poor quality bags that can be seen …show more content…
The company bets on an online revolution for 2017. Today, Prada’s online sales accounts only for only 2% of its’ total sales. In a global world in which online sales of total luxury goods grew four times faster than offline sales from 2009 to 2014 and in which everyone is connected, 2% is way too low. That’s why Carlo Mazzi, Prada’s chairman, is “setting a target of doubling online sales every year for the next three years”, and in order to achieve this, he plans to increase the social media activities of the company.
Secondly, the company also think about a total restructure in its’ stores’ locations. We previously have shown that Prada has opened too many stores in a short time and that wasn’t the appropriate strategy since they have failed to provide a good return on investment. Now, they plan to close some stores and to restore old ones which will contribute to make a fresh start to the brand image, which is not currently very high.
Another strategy the company is implementing is to develop a new price structure. Prada’s goods are very expensive with high-quality and rare materials. There is no medium priced products because the company always wants to be extraordinary. But it doesn’t cover the needs of customers anymore. Indeed, they still want luxury products but they want more and diversified ones. That explains why they need to be present in all the luxury market by covering every price