Patagonia Case Briefing

Topics: Yvon Chouinard, Target, Target market Pages: 10 (2949 words) Published: July 28, 2013
Patagonia: A Case Briefing
Prepared by Kenny Ruth
In partial fulfillment for Integrated Business Planning I
Dr. Michele Govekar

Company History
With an entrepreneurial spirit from early in his career, Patagonia’s founder Yvon Chouinard’s story is truly a tale of turning one persons passion into many peoples lifestyles. Beginning in 1957, Chouinard got into the business of by creating his own version of climbing “pitons,” the pegs climbers use to scale the sides of mountains or rock formations. By 1967 he had partnered with fellow climbing enthusiast Tom Frost and created Chouinard Equipment Ltd. By the early 1970’s, the pair became the largest supplier of climbing hardware in the United States, while also opening the first Patagonia store in Ventura, California. (2009)

The name Patagonia is homage to the region of southern Argentina and Chile. As abstract as a name can get, the overall idea and meaning of the brand fits with the vision of the company. The region possesses a vast amount of environmental differences whether it be land formations, flora present, and the elements that can be experienced. Each difference that the region offers is represented by various product offerings available by the brand. (1997)

With an increasing amount of success, the 1980’s greeted Patagonia with rapid expansion that put the company on edge. At this time, outdoor fashion was stuck in a drab color scheme – dominated by forest greens and dirty browns. Patagonia wanted to give their look a more nontraditional style with classic designs and vibrant colors. They hoped to maintain their rugged attitude but also wanted to add its own personal wink to the industry. This daring move proved to be too much growth all at once, with the line being viewed from industry leaders and consumers as more “fashionable” than functional. (1994)

The company was moving towards becoming more fashion conscious than being a staple for outdoor enthusiasts, selling more non-sporting apparel than the brands more technical offerings. The company’s tremendous growth stopped in 1991 with the economic recession causing some of the brands banks to close and resulting in having to lay off about 20 percent of their employees. Learning their lesson, Patagonia has since then made changes about internal and external growth and that sometimes moderation pays off. (1994)

Product Development
When it comes to product development, Patagonia prides itself by using three main criteria: quality, environmental impact, and aesthetics. Innovation in a market as large and diverse as athletic and outdoor apparel and goods is key, and Patagonia is undoubtedly a front-runner for innovative products. (1994)

From meticulously choosing the most environmentally sound materials to scrutinizing every design to guarantee perfection, Patagonia is involved directly with all processes. The company has developed strong relationships with fabric manufacturers to create their very own superior fabrics to use in the creation of their garments – explaining why they can put a hefty price tag on their goods and why the quality is exceptional. (1994) In the 1990’s Patagonia switched from using conventionally grown cotton to organically grown. They found that the methods for growing traditional cotton used toxic chemicals (pesticides) and dyes had adverse affects on soil and water. The company discovered that costs were comparable between both methods, except in some instances. For a break down of using conventional cotton as opposed to organically grown cotton and the costs of each, refer to Exhibit 1. Patagonia wanted to use this aspect of their brand as leverage against their competitors – making a statement that when someone buys from Patagonia, they are doing something beneficial for the environment. They wanted to be the role model for other industry leaders.

Another positive attribute that Patagonia likes to make known is that their products are primarily manufactured in the...

Bibliography: C. McEwan, L.A. Borreo and A. Prieto. [1997] Patagonia:Natural History, Prehistory
and Ethnography at the Uttermost End of the Earth. Princeton University Press with British Museum Press.

F. Reinhardt, R. Casadesus-Masanell and D. Freier. [1994] Patagonia. Harvard
Business School.

Patagonia. [2009] Company History. http://www.patagonia.com/web/us/
patagonia.go?assetid=3351&ln=79
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