Ch. 4 - The Marketing Environment

Michael Kors USA, Inc. has been giving its competitors a run for their money with its successful major growth within the past year. Its target market was mainly women from 30s to 40s. However, now due to all the expansions and line additions, the main new target begins with women young twenties to endless who are looking for the quality in a product and pieces to wear, not just everyday clothing. A smaller portion of the target market reaches out to men with the men's lines and accessories. Michael Kors marketing strategy has been very simple. MKUSA maintains its luxury brand and maintain its customer base by offering various product lines that reaches out to every class; the expensive high-quality Michael Kors and the relatively cheaper Michael line, and all other lines.

"A Michael Kors woman is a woman who celebrates her femininity."

Each store, in itself reaches out to the desired target market with its ambiance and glow but also stands back and allow each piece to sell itself. The neutral color balance of each store sort of enhances both the luxurious look and the quality of the clothing and/ or accessory. The merchandise are all individually showcased, portraying a more runway feel. Everyday there is more opportunity. With the brand being increasingly familiar to shoppers of the USA, the company has a greater chance at capturing more customers abroad as economies recover; thanks to the help of Mr. Kors, himself, participating in the hit TV show, Project Runway.

"The only way fashion comes to life is if someone wears it, and I don't think just wears it in a fashion show."

Critics look at Michael Kors and immediately think the company is prone for a ride straight downhill looking at how quickly its expanding. They say it will be another case like Tommy Hilfiger in the late 90s when customers started to abandon the brand, and like Kenneth Cole, who announced he was closing eight stores in a couple months. Michael Kors' stock has more than doubled in just 9 months and has among the best dept of equity, current ratio, EPS growth, and profit margin in the industry. Therefore, the company has indulged and is indulging in new areas such as: Rue Saint-Honoré, Paris (its largest store yet, 7,000 square-foot flagship), the first store in France, HongKong (only carrying the highest-priced line), boutique in Tokyo, subsidiary in Japan (products for stand-alone and department stores), and fifty stores in the greater part of China over the next three years. And that all adds mens' underwear and leathergoods, iPad and even travel and food to his whole empire. All the stores, other than the ones listed with specific lines, will have all the lines included because its convenient for everyone. He put it together perfectly, "let's be honest, the wealthy still need a flip flop", he says. Rue Saint-Honoré, Paris (its largest store yet, 7,000 square-foot flagship), the first store in France, HongKong (only carrying the highest-priced line), boutique in Tokyo, subsidiary in Japan (products for stand-alone and department stores), and fifty stores in the greater part of China over the next three years. And that all adds mens' underwear and leathergoods, iPad and even travel and food to his whole empire. All the stores, other than the ones listed with specific lines, will have all the lines included because its convenient for everyone. He put it together perfectly, "let's be honest, the wealthy still need a flip flop", he says.

“Anybody would be crazy not to invest in it. Michael Kors is the next major global player in my eyes.”

Key Sources: beta.fool.com , wall street journal , investors.com , observer.com  Quotes by: Stefani Greenfield , Tommy Hilfiger