As a company that is based largely on outsourcing, subcontracting, and relationships developed between a large company and several small producers and distributors, Benetton's success has become an example for multinational business around the world Benetton's ability to maximize profit and to minimize expenses has played a large role in its foundation. The retail market is not served directly by the company but by investors who purchased the right to sell Benetton items in their stores. Therefore, Benetton is a "pure manufacturer," providing only clothes and use of the Benetton names to franchisees.
Benetton's focus on creating an integrated relationship between the parent company and its licensees is further reflected in its efforts to speak personally to each consumer through the company advertisements. By using pictures of social issues that are familiar throughout the world, Benetton's advertisements appear to establish an intimate connection with all consumers, regardless of their ethnic background, language, or culture, by speaking through a medium that transcends national boundaries. As does its distribution method, Benetton strives to incorporate a sense of familiarity and family in each business sector. Because Benetton is largely managed by members of the Benetton family, the company can easier sustain the intimate communication network that many U.S. companies attempt to develop by organizing individual departments into teams.
Maintaining Luciano Benetton's ability to transform "sweaters into messages, shirts into signs, and jeans into signifiers," the company sought out an artist, not an advertiser who respected the rules of traditional marketing . Benetton hired Oliviero Toscani, a photographer who has earned recognition from his edgy photography style. Toscani chose to use print and poster as his media, a very unusual advertising decision for a clothing company. In addition, because television advertisements historically have cost retailers up to 62% of their advertising budgets, Benetton initially refused to promote itself on television. They later agreed to do so only on specific networks outside of Italy, such as MTV in the U.S.2
At the heart of Toscani's basic advertising and marketing strategy was what he often referred to as a "communications strategy" based on the diversity-focused slogan integrated into the United Colors of Benetton Campaigns. With this theme of unification, Toscani chose to transform advertising into "news," paying close attention to current events.2 Because Benetton's clothes were sold around the world, the expenses incurred to tailor campaigns to specific national markets would have been enormous. To reduce these high costs, Toscani attempted to bring the world's markets together by using a single advertisement that would appeal to many cultures, races, religions, and lifestyles. The goal was to reach people's souls, to invoke discussion of controversial topics, and to bring...