French Connection: Market Analysis
By: Conor Carroll, Linda Fitzek, and Ruth Kennealy, University of Limerick.
French Connection the high street fashion retailer could be in danger of disconnecting with its customers. Last year, investors were extremely anxious when the firm announced that sales were down by over 18% for a quarter. The British firm, which has enjoyed unparalleled success over the last five years, is now facing tough challenges ahead, as it tries to recapture the magic of its past sales successes. CEO Stephen Marks founded the company in 1972. He named it after his favourite movie. In the late nineties, the firm enjoyed meteoric growth. The company gained worldwide coverage, thanks in no small part to the firm’s use of a controversial four-letter acronym, which it used as its logo. Emblazoned across t-shirts, caps, bags and sunglasses the manipulated swear word became ubiquitous. Their T-shirts with some sexually lewd double entendre slogan on it became hip and de rigueur. However the concept may now have lost its appeal and fashion status. Becoming seen as tired and tacky. Where to now for French Connection?
Background
French Connection operates as a multiple specialist fashion retailer, competing against the likes of Zara, H&M, Top Shop, Miss Selfridge, Next, River Island and Warehouse. This industry is highly competitive with numerous international brands fighting in the segment. French Connections’ operations cover several distribution channels, from their own retail outlets, wholesalers in North America, franchises, mail order, to concession stores in a variety of department stores such as Selfridges. The group has almost 150 stores worldwide including more than 30 in the US. The company hopes to double its presence in the US. It is trying to expand rapidly there, despite all of the negative current geopolitical connotations, surrounding all things French in the US. In February 2001, French Connection paid £23 million pounds sterling to its US joint
French Connection the high street fashion retailer could be in danger of disconnecting with its customers. Last year, investors were extremely anxious when the firm announced that sales were down by over 18% for a quarter. The British firm, which has enjoyed unparalleled success over the last five years, is now facing tough challenges ahead, as it tries to recapture the magic of its past sales successes. CEO Stephen Marks founded the company in 1972. He named it after his favourite movie. In the late nineties, the firm enjoyed meteoric growth. The company gained worldwide coverage, thanks in no small part to the firm’s use of a controversial four-letter acronym, which it used as its logo. Emblazoned across t-shirts, caps, bags and sunglasses the manipulated swear word became ubiquitous. Their T-shirts with some sexually lewd double entendre slogan on it became hip and de rigueur. However the concept may now have lost its appeal and fashion status. Becoming seen as tired and tacky. Where to now for French Connection?
Background
French Connection operates as a multiple specialist fashion retailer, competing against the likes of Zara, H&M, Top Shop, Miss Selfridge, Next, River Island and Warehouse. This industry is highly competitive with numerous international brands fighting in the segment. French Connections’ operations cover several distribution channels, from their own retail outlets, wholesalers in North America, franchises, mail order, to concession stores in a variety of department stores such as Selfridges. The group has almost 150 stores worldwide including more than 30 in the US. The company hopes to double its presence in the US. It is trying to expand rapidly there, despite all of the negative current geopolitical connotations, surrounding all things French in the US. In February 2001, French Connection paid £23 million pounds sterling to its US joint