Business Strategy Case Study: Mulberry

Topics: Glastonbury Festival, Balance sheet, United Kingdom Pages: 6 (2129 words) Published: May 23, 2012
STRENGTHS| * Mulberry is a British design company known worldwide for its craftsmanship and design. * Mulberry also has a UK based factory in Somerset known as the ‘Rookery’ which promotes the idea of British craftsmanship. * Mulberry has successful collaborations with influential figures within the UK fashion industry such as Alexa Chung and have consequently named a bag after her (the ‘Alexa’) * Mulberry are also launching a new bag named after the American singer Lana Del Rey, known as the ‘Del Rey’ bag which will help to broaden the brand knowledge internationally, particularly North America. * Sales are still rising substantially with a 69% increase from 2010-2011- thus Mulberry is still growing significantly and showing real promise as a global brand. * Mu,berry is expanding globally opening new stores by parteners in Beijing, Hong Kong, Malaysia, Korea, Quatar, UAE and Sydney. * Mulberry is opening a new 5,000sq ft flagship store on Spring Street, Soho New York which will mark the beginning of the next stage of the North America expansion. * There is a Corporate Social Responsibility program which focuses on six key areas: Climate change, reducing waste, fair partners, animal welfare, community involvement and health and wellbeing. | WEAKNESSES| * Mulberry has high prices and therefore has a narrow target audience; it does not have a constant more affordable line yet. * Mulberry is focusing heavily on capitalizing on expansion into China during 2011-2012, but this is not necessarily the best idea with the disposable income in china going not being as high as it previously was. (see bottom of page for link to website for references). * Mulberry has other products on offer, but is largely known for its bags, and so to increase its market share it could increase its product range which is fairly limited. * It also lacks the depth of heritage of some of its other competitors (such as Louis Vuitton) as it was only founded in 1971, so needs to capitalize on its British heritage and British factory in order to compensate. | OPPORTUNITIES| * Mulberry is supporting British craftsmanship by having a UK based factory in Somerset, but could use more effective marketing in order to promote this and utilize it as a USP for the brand. * Mulberry is growing at a substantial rate within the UK and is establishing itself within the UK market as an up market luxury brand, but has a lot more scope for global expansion with high demand coming from overseas (International sales for 2010-2011 were £40.5 million, up 145% on the prior year). * Disregarding the two (soon to be three) Mulberry stores in New York, there is much scope for American expansion with Los Angeles and West Coast destinations remaining untouched by Mulberry, this is a valuable market for Mulberry especially with the launch of their new ‘Del Rey’ bag with Lana Del Rey being LA based. * Mulberry is focusing on international expansion with events such as the ‘Mulberry Barbeque’ at the Coachella music festival in LA but there is more opportunity to focus on its British roots and so should sponsor more British events such as Glastonbury instead. * There is also opportunity to focus on a younger audience and possibly more affordable range as the price points are all fairly high and unaffordable to the average younger consumer. | THREATS| * Although Mulberry has a factory in Somerset, it only manufactures 30% of its bags in the UK so this could damage the brand image if publicized. * The decrease in disposable income for China could be a threat to Mulberry (who are focusing heavily on Chinese expansion for the upcoming year) who rely on high disposable income for customers buying into their luxury brand. * The general economic condition with the UK being officially in a ‘Double-Dip’ recession could harm Mulberry’s consumer confidence. |...
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