Look anywhere this winter and chances are you can find someone wearing canada goose rea, 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 among the season’s most widely used brands. The company’s parkas, recognized by the round, two-inch patch on the left sleeve and the coyote fur-trimmed hood, once warmed arctic explorers and Canadian Rangers, but today 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 university students.
What sets Canada Goose in addition to other outerwear companies are its exorbitant prices-$745 for the women’s coat, $245 for any hat at Bloomingdales. Prices can go as high as $1,700.
But those steep prices haven’t hurt business a little. Fortune magazine reports that during the last decade, Canada Goose has seen revenues explode from $5 million to greater than $200 million, with a bit of experts predicting that figure could rise to $300 million by the end of the year.
A part of Canada Goose’s success may be associated with playing up its humble founding five decades ago in a tiny warehouse in Toronto (the outerwear continues to be created in Canada). And whenever private equity firm Bain Capital acquired a majority stake from the company in 2013 for a rumored $250 million, it were required to promise to hold the manufacturing there.
Canada Goose is really 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 ways it offers formed relationships featuring its customers.
BU Today: How come Canada Goose such a popular brand at this time?
Fournier: I don’t have their marketing strategy facing me. All I realize is the fact their marketing emanates from grassroots. They had a solid narrative, and after that it started getting gathered by certain groups. People started to contemplate hardcore Canadians braving the cold, so it became a fad then transitioned from a fad into a strong brand. I believe it’s mostly concerning this and keeping prices high, not going insane with sublines like making lighter fall jackets, for instance. Also protecting distribution therefore they don’t arrive for much less store like TJ Maxx or even an outlet. It’s that, being smart enough never to kill it.
So you’re saying that some brands damage anything they have by expanding too fast?
I feel that’s the case with a lot of things. Burberry has come back now in popularity, however they were in danger for a time, and the same thing was true with Calvin Klein. They made their brands too available. If you’re going to 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 advertising campaign, you have the four Ps: product, place, price, and promotion. The pricing and also the distribution are the most crucial for any brand similar to this. It’s growing, everyone would like it, so it’s difficult to say, “Well, we’re not going to make it accessible for everyone,” because you always would like to serve shareholders to make the greatest profit.
Is price the key barrier for accessibility?
I feel distribution, too. Barriers to accessibility would additionally be, “Can you get a hold of it?” You will need to work just a little harder to discover it. This brand has exclusive distribution; it’s not everywhere. Those are two barriers.
There’s a great deal of hardy outerwear out there-L.L. Bean, North Face, Patagonia. How have those brands convinced individuals who winter gear is fashionable or even a luxury item?
That’s interesting too. The North Face has grown hundreds and numerous percent over recent years, and so they could risk blowing everything up. But people are still within their ultra down coats, so they remain hanging within. But they’re sort of at this close edge.
At some time, several of these brands were only seen in small communities, like L.L. Bean was once for fishermen and hikers, but they broadened. I believe that’s step one; you begin to shift the category frame that you consider this as. It’s not hard-core expedition wear, it’s about outer fashion. Outerwear remains outerwear, nevertheless, you don’t will need to go on an arctic expedition anymore.
Step one is transitioning the manufacturer to fashion. Remember Swatch? The innovation in Swatch was that watches was once about timekeeping, and then they managed to get about fashion. They told customers that if they purchased a Swatch watch, it absolutely was actually like they had 10 watches due to the interchangeable bands. Same thing with eyeglasses. You used to have one pair, and now people often times have several with some other designs.
Then it’s element of a trend that individuals are able to pay more for. People are paying more forever quality things generally. Glance at the iPhone like a great example. Who with their right mind goosejacka to enjoy $800 with a phone? But we’re doing well enough being an economy, and it’s become easier for many people.
How about the backstory for companies like Canada Goose? Could it be important produce a narrative around a brandname to be successful?
Over these narratives you sense like you can are aware of the founder being a person. They’re adventure seekers. It’s the exact same thing with Patagonia and L.L. Bean. I think that’s a massive factor. Maybe more in contemporary consumption, more so in past times 10 or 20 years, this idea of any narrative is critical. There are so many brands out there that in case you don’t have a story, and a character in your story, you’re behind. Like in your English classes, you need a character as well as a plot to generate a good story.
Possessing a story differentiates you together with gives your brand authenticity, which is critical for brands today. Harley Davidson is a good example-they have got this founder myth. The founders of Snapple were hugely essential for getting Snapple off the floor; these people were window washers. If you dig into a few of your top brands, they all have these mythologies. And they possess some credentials in terms of 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 form of advertising?
That’s kind of things i was returning to. The wonder here is they don’t possess a advertising campaign with a capital M, meaning traditional stuff. Instead, they’re doing cultural branding. Cultural branding means you would like your brand to naturally become section of the culture-in other words, placing the products to the audience the place you want it to gain traction.
The process is basically that you make an effort to get men and women to use the product and focus on 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, a lot more approachable. You wish to become component of culture. Whenever you become part of culture, then you can find right into a movie with a scene in which the characters happen to be in a very cold climate. Hollywood wants brands that happen to be hot since they convey lots 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 going to seem commercial, and it’s not pushing something.
Why has Canada Goose decided to concentrate on the college market?
I don’t know the reply to that without seeing their marketing plan. I was able to see young adults being a target; I don’t determine it’s just college. However, you figure university students might have the capacity to afford these matters, which it’s a good target audience, one that’s hip. They’re not targeting youngsters.
A BU student launched a parody patch and raised funds on Kickstarter to produce the patches. Does Canada Goose benefit from parodies like this?
It depends on the parody, but 80 percent of parodies are type of good. If they’re choosing your primary message, and discrediting you, that’s probably a bad idea. For instance, Matthew McConaughey did a series of Lincoln car spots, and other people made parodies that hit a little too close to home.
But use 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 product wants individuals to accept them as an element of today’s cultural fabric.
Every brand wants to have this product everyone wants, therefore the challenge is to ensure that it stays cool. The test for Canada Goose will likely be springing up, and let’s see if they can ride this wave and not kill it.