Principles of Marketing

Assignment # 2
Name: Muhammad Saad Asif
Student id: 11058
Company: Calvin klein
Question #01: What does a Brand Do? How it is Branded?

HISTORY OF CALVIN KLEIN:

Calvin Klein Inc is an American fashion house established in 1968. It specializes in leather,
lifestyle accessories, home furnishings, perfumery, jewellery, watches and ready-to-wear. The
company has substantial market share in retail and commercial lines as well haute
couture garments.
The company was founded by designer Calvin Klein and his childhood friend, Barry K.
Schwartz. The company is headquartered in Midtown Manhattan, New York City.
The early years:
In 1968, Calvin Klein founded Calvin Klein Limited, a coat shop in the York hotel in New York
City, with $10,000. The first Calvin Klein collection was a line of "youthful, understated coats
and dresses" featured at the New York City store Bonwit Teller
In September 1969, Klein appeared on the cover of Vogue magazine.
1970s
By 1971, Klein had added sportswear, classic blazers, and lingerie to his women's collection.
In 1973, he received his first Coty American Fashion Critics' Award for his 74-piece womens
wear collection - the youngest recipient at that time.[6] Klein won the award again in 1974 and
1975. By 1977, annual revenues had increased to $30 million (equivalent to $127 million in
2020), and Klein had licenses for scarves, shoes, belts, furs, sunglasses, and bedsheets . Klein
and Schwartz were making $4 million each. After the company signed licenses for cosmetics,
jeans, and menswear, Klein's annual retail volume was estimated at $100 million (equivalent to
$422 million in 2020).
1980s
In the 1980s, as the designer-jeans frenzy reached its all-time high, Calvin Klein introduced a
highly successful line of boxer shorts for women and a men's underwear collection which would
later gross $70 million in a single year. The American market of men's underwear was changed –
from one where most men's underwear was white, purchased in packs of three by a "wife, mother
or girlfriend when they needed to be" to one where "the American male [cares] about the brand
of something few ever see".
1990s
Although the company almost faced bankruptcy in 1992, Calvin Klein managed to regain and
increase the profitability of his empire throughout the later 1990s, mainly through the success of
its highly popular underwear and fragrance lines, as well as the ck sportswear line. During his
1990-1995 stint as Calvin Klein's head of menswear design, John pioneered a type of men's
underwear called boxer briefs, a hybrid of boxer shorts and briefs.
2002–present:
In mid-December 2002, Calvin Klein Inc. (CKI) was sold to Phillips Van Corp (PVH), whose
then CEO Bruce was the driving force behind the deal, for about $400 million in cash, $30
million in stock as well as licensing rights and royalties linked to revenues over the following 15
years that were estimated at $200 to $300 million. The sale also included an ongoing personal
financial incentive for Klein based on future sales of the Calvin Klein brand.
With the fall 2006 Collection runway presentations in New York City, CKI inaugurated an
8,600 sq ft (800 m2) showroom space that can seat up to 600 people on the ground floor of 205
West 39th Street, in Times Square South where Calvin Klein has been headquartered since 1978.
In a 2010 report, PVH, who manages the ready-to-wear activities, had estimated sales of €4.6
billion of Calvin Klein products.
In February 2013, Warnaco Group was acquired by PVH which united Calvin Klein formal,
underwear, jeans and sportswear lines.

Products and marketing:

Product & brand history
The most visible brand names in the Calvin Klein portfolio include:

 Calvin Klein 205W39NYC (black label, upscale top-end designer line)

 Calvin Klein (grey label, recently repositioned as bridge collection line; licensed
to Warnaco Group, Inc. through at least 2044. PVH acquired Warnaco Group in Feb 2013])
 Calvin Klein (white label, basic fashion better sportswear line)
 Calvin Klein Sport (sports version of the white label line for Macy's)
 Calvin Klein Jeans (denim wear line; licensed to Warnaco Group through at least
2044. PVH acquired Warnaco Group in Feb 2013)
 Calvin Klein Home (high end bedding, towel, bath rug and accessory collections)
 The Khaki Collection (youthful medium to high end bedding, towel, bath rug and
accessories) discontinued in 2008
 Calvin Klein Golf (launched in late 2007)
  Calvin Klein Underwear (underwear collections; licensed to Warnaco Group through at
least 2044. PVH acquired Warnaco Group in Feb 2013)
 CK one Lifestyle brand (fragrance, underwear, jeans -launched 2011)
 Calvin Klein Watches + Jewelry (watches launched in 1997, jewelry in 2004)

Fragrances
Calvin Klein has various lines of perfumes and colognes, including Obsession and Eternity. Until
May 2005, their perfumes and the corresponding fragrance lines were maintained by Calvin
Klein Cosmetics Company (CKCC), a Unilever company. Cosmetics giant Coty, Inc. of New
York bought the fragrance licensing agreements from Unilever.
Branding:
Like other fashion brands, Calvin Klein established a monogram: the "ck" emblem.

Competitors of Calvin Klein:

Calvin Klein is an American fashion and luxury goods company. The company was

established during the year 1968 and is headquartered in New York, United States.
The company focuses on the production of various products like
leather, lifestyle accessories, home furnishings, perfumes, jewelry, and ready-to-wear
apparel.

Calvin Klein is a popular brand for casual outfits. The company has two main
business operations. The operation that takes care of production and sale for men and
women apparel is the Calvin Klein Apparel. The operation that takes care of licensing
is the Calvin Klein Licensing.

The Calvin Klein competitors

 1) Ralph Lauren
 2) Armani
 3) Chanel
 4) Versace
 5) Gucci
 6) Tommy Hilfiger
 7) Hugo Boss
 8) Guess
 9) LVMH
 10) Kenneth Cole
 11) Donna Karan

Marketing Mix of Calvin Klein:

Product in the Marketing Mix of Calvin Klein:

First products that were launched by brand Calvin Klein was a line of understated coats and
youthful dresses and by the year 1971 its kitty included lingerie, classic blazers, skirts, shirts,
pants and sportswear for women. Classic fabrics, earthy tones and simple yet elegant designs
gave his work an understated elegance which became highly popular.  Later sunglasses, furs,
belts, shoes and scarves were added to the collection.  During the late 1970s, Calvin Klein re
launched his collection of jeans and gave it a more firm shape which became a rage amongst its
customers. Later this jeans-inspired assortment included jackets, skirts and shirts. Products in its
men’s collection included overcoats, suits and neckties that were stylish, comfortable and simple.

Place in the Marketing Mix of Calvin Klein:

In the year 1989, brand Calvin Klein opened its first store in Dallas Suburb. It was a free-
standing full-line store with products like fragrances, cosmetics, accessories, outerwear, shoes,
hosiery, sleepwear and underwear for both male and females. In the year 1995, the brand opened
a 22,000-square-foot store of four levels at Madison Avenue. By this time its number of stores in
the United States were six through which it was dealing successfully with its customers. During
1993 and 1994, the company made a deal with four companies of Japanese origins for creating
in-store shops. By now brand was selling its products through an estimated 12,000 outlets in the
United States and its products were also being sold in countries like Japan, New Zealand,
Australia, Ireland, United Kingdom and Canada.

Price in the Marketing Mix of Calvin Klein:

Brand Calvin Klein has opted for competitive pricing policies that are changeable to suit
the needs and requirements of particular product line or place. In 1977 it was able to generate
huge revenues because of its penetration pricing policy as it wanted to keep its prices lower than
its major competitors. Its strategy was successful and its products became highly popular among
both older and younger generation and also among middle and wealthy class of people.
Competitive pricing has helped the brand in maintaining the loyalty of its customers through
high sales.

Promotions in the Marketing Mix of Calvin Klein:

Calvin Klein has always believed in the positive impact of promotional strategies and has
undertaken various measures to promote its business. Controversial advertisements have also
helped in high visibility in markets and have resulted in huge turnovers. In the late 1970s, a
billboard at Times Square was put up showing Patti Hansen, a model, on her knees and hands
with her derriere skyward and brand label visible on right hip. This caused a sensation. One of
the most controversial ads of Calvin Klein jeans were of 15-year old Brooke Shields posing in
skin-tight pair with provocative comments. Although the posters were later taken down but by
that time they had done their part in making the brand a high-profile one.  

Market segmentation
Calvin Klein has an existing loyal target market. We want to capture this existing market, and
also encourage more purchasing frequency. Our multi-use new product will attract a larger
segment as those who have not yet bought the underwear due to the premium price will be more
likely to consider the swimwear, as it has two functions and in their minds it provides more
value.
The main segment we are targeting in the launch campaign is:
–    21-30 year olds males and females
–    With high disposable income
–    Fashion and trend conscious
–    Sydney’s inner city, metropolitan dwellers, as well as coastal areas such as the northern
beaches

Targeting
Our swimwear is for both males and females. By targeting a specific small target market for the
launch campaign, which includes the existing brand loyals, and those with a high disposable
income .  In the attempt to encourage a word of mouth buzz surrounding the new range. This will
encourage those outside the premium segment to desire and buy the product.

Positioning
The swimwear range will be positioned using price/quality characteristics. The product will give
wearers a sense of prestige and style, which will filter down through followers of trends and the
early majority.

Brand personality:
Calvin Klein is a born leader, with extra-ordinary drive and determination. Insisting
on his right to make up his own mind, he demands freedom of thought and action,
and does not let anything or anyone stand in his way once he is committed to his
goal.
Always seeking the forefront and the limelight, Calvin needs to feel in command of
important undertakings, and resists supportive roles. He can become irritated and
even domineering when important things do not go his way. Klein can be impatient
with his shortcomings and those of others.
Calvin Klein is very concerned with his status and fosters the appearance of success
and self-satisfaction. Interestingly, that very same need to appear well-off can be
the fuel that propels Calvin to strive for growth, success and the finer things of life.
Calvin Klein assumes the responsibility to be the protector and provider for those
he loves, but demands their respect and attention in return.
Exceptionally creative and original, Calvin possesses a touch of the unusual. His
approach to problems is unique and he has the courage to wander from the
traditional templates of thoughts and deeds.

How Calvin Klein achieve his objective:

-Advertising (Television):
The use of this tool will help increase awareness in society and also maintain high brand
recognition in consumer mind. Introducing the CK swimwear to a mass market is one of many
ways to attract the market attention especially both male and female fashion conscious, city and
beach dwellers, brand loyal and the younger demographic 18- 30 years old with high disposable
income. The use of model as an endorser will also aim to create a need or preference in
consumer mind.

-Advertising (Magazine):
It is essential to have the new CK swimwear show up in the fashion magazine. As most of early
adopters are fashionable people, the new CK swimwear which not only offer a comfort but also
fashionable look and design will buzz this particular niche market.

-Interactive Media/ Internet:

The development of advanced technology has allowed society to do everything through online
media, and thus led to dramatic growth of communication on Internet. By utilizing internet as
promotional tool, this media will create a need and provide rational appeal to the consumer about
the new CK swimwear product. Furthermore, it also further promotes the new CK swimwear on
an international playing field and may create a demand from overseas market. The younger
demographic is the main target market by employing this promotional tool as they have the
tendency to go online for information about products and trends.

-Direct Marketing:
By communicating directly with existing loyalty club members through mail, this tool will
encourage consumer to purchase directly from both manufacturer and subsidiaries stores. It is
very useful to encourage brand loyalty and purchasing of the new CK swimwear line. This may
increase awareness of the new product and may shift consumer to a higher level of purchase
behaviour.

-Personal selling:
In this tool, our team project aim to achieve a professional look by providing each CK’s stores
with a salesperson that is highly knowledgeable regarding the new CK swimwear. To create a
sense of the premium brand, the store will be re-designed to create a sense of luxury that
encourages the belief of a quality product, and attracts fashionable high income earners to the
store.

Calvin Klein unveils new logo in collaboration with

Peter Saville:
The graphic designer has worked with the fashion brand’s in-house creative team to tweak the
logo and “return it to the spirit of the original” one.

Calvin Klein has a new logo, which has been tweaked and redefined by graphic designer Peter
Saville.

The fashion label has swapped out its lowercase logotype for an uppercase one with a smaller
kerning gap between letters, retaining its black colour and sans-serif.

It aims to pay homage to the self-named company’s founder, who launched the US company in
1968, and to the “foundations of the fashion house”, says the company.

Calvin Klein’s in-house creative team, headed up by chief creative officer Raf Simons, worked
on the new logo, collaborating with Saville.

A lowercase “ck” previously sat above the Calvin Klein logotype and was used alongside it – it
has not yet been confirmed whether there will be a new short-hand uppercase “CK” icon to go
alongside the new logo.
Brand equity:
With all the advisement and campaigns, the brand is perceived as a global lifestyle brand that
exemplifies bold and progressive ideals with the seductive and minimalistic aesthetic.

The brand’s image is kept consistent through the brands distinctive marketing identity and
strategy. People with intimate, modern, iconic and classic lifestyle imagery gets attracted to the
brand. The brand describes itself as the honest, authentic and genuine brand. With continuous
success since 1968, the customers view CK as a reliable fashion brand which is minimalistic and
classic

Customer analysis of Calvin Klein:

Customers of Calvin Klein mostly consist of the younger generation in particular men and
women between the age of 15-40. Individuals with high relatively high disposable income and
the ones more conscious about the fashion and trends constitute the major chunk of customers
for the brand.

Promotion strategy of Calvin Klein

In 2015, around $320 million was spent globally in connection with the advertisement,
marketing and promotion of Calvin Klein brands.

With the Kardashians and Jenners family featuring in the “MyCalvins” campaign, it created a
strong message highlighting the importance of family. With Justin Bieber endorsing the
underwear segment helped to attract the young customers.

With the #IAMWOMEN campaign, the brand talks about women empowerment and has
introduced perfume ranges, drawing inspiration from the multifaceted identity of feminity with
aspirational women around the world endorsing the brand.

It also performs direct marketing by allowing consumers to sign up to the brand’s newsletter

which sends them emails informing them about the brand and their promotional offers, thus
ensuring consistent communication to improve the brand loyalty.

There are more than 446,029 photos on Instagram with the tag #mycalvinsand found more than
4.5 million interaction. The campaign was then displayed on billboards on prints, Ck stores etc.
On the Calvin Klein website, there is a #mycalvins gallery which encourages customers to
upload the photo of themselves in the social media and get a chance to be featured on their
website.

The fact that the campaign has captured the desired target audience using their customers without
any cost, causes it to be so successful

Calvin Klein Stores:

 Calvin Klein Collection
In the late 1990s, the company opened elegant Calvin Klein Collection stores in Paris, Seoul, and
Taipei and ultra high-end cK Calvin Klein stores in Hong Kong, Milan, and Kuwait City. As of
today, there is only one Calvin Klein Collection store operated by CKI. It is located in New York
City. Out of the two Calvin Klein Collection stores that existed in the US, the Dallas location in
Highland Park Village which had been open for 20 years was closed in mid-2005. The only
international location, in Paris, was closed by PVH in March 2006. Partners maintain Calvin
Klein Collection stores in Hong Kong, Shanghai, Mumbai, Seoul, Singapore, Kuala Lumpur,
Bangkok, Dubai, and Qatar.

Calvin Klein (white label)

Specialty retail Calvin Klein stores, designed by New York architecture firm Lynch/Design have
been opened at Lenox Square in Atlanta, Beverly Center in Los Angeles; now closed
down, Cherry Creek Mall in Denver; now closed down, Natick Collection in Natick, MA;
closing down on July 25, 2010, The Mall at Partridge Creek in Michigan; now closed
down, Aventura Mall in Aventura, Florida, South Coast Plaza in Costa Mesa California. An
additional eight stores also designed by Lynch/Design are set to open in 2008.
Calvin Klein Jeans
Calvin Klein Jeans stores exist around the globe. Among many other countries in the UK,
Germany, Greece, Russia, Brazil, México, Croatia, Egypt, Chile, Argentina, India,
the Philippines, Australia and New Zealand. They also offer franchisee and opened in Cali last
year.

 Department Stores
The major department stores in the US, including Macy's, Lord & Taylor and Nordstrom, as well
as many small independent stores carry the ck, white label and/or Jeans collections. Some high-
end department stores, such as Bergdorf Goodman, Saks Fifth Avenue and Neiman Marcus also
carry the Calvin Klein Collection. Notable retailers in the UK offering Calvin Klein include
stores such as John Lewis, Debenhams and KJ Beckett. In Australia, the dominant retailer
is Myer. Calvin Klein products are also found online with particular internet focus on selling
Calvin Klein underwear and fragrance.

 Europe and Asia

In Europe, Calvin Klein is predominantly known for its underwear, accessories and perhaps
the Collection business, rather than for the medium-priced sportswear lines which are available
at select high-end retail stores. In Asia, there are also signature ck Calvin Klein stores that carry
diffusion line, aka grey label including womens wear, menswear, accessories.