Kate Spade New York: Will Expansion Deepen or Dilute the Brand

1. What is the brand of Kate Spate? If the key to KSNY’s success is the brand, how do they protect and maintain it?

The brand of Kate Spate is the “lifestyle brand”, whose brand voice is always colorful, bold, playful, clever, spirited, chic, optimistic, graphic, aspirational, and timeless, and it inspires customers to lead a more interesting life.

KSNY has many ways to protect and maintain the brand. Firstly, to appeal to the brand value, KSNY’s designs, products, displays, ads, digital communications are all according to it. The new products are featured bold color and feminine detailing, which accent the customers’ interesting life. KSNY stores’ displays are refreshed and adding more color. It also offers styling tips in the website, which meets “interested and interesting” lifestyle needs. It also communicates brand voice and engages the customers in brand storytelling.

Secondly, KSNY monitors the brand voice. Its brand guidelines are rolled out to all internal employees, store associates and partners. Marketing management ensure the each ad campaign is well coordinated. It also takes advantage of the direct feedback though social media and employees.

Thirdly, KSNY also tracks brand identity and brand performance, which means that it uses market research surveys to monitor levels of brand awareness, familiarity, favorability, consideration, ownership, and usage, assessing the brand’s health both over time and in comparison with key competitors.

2. KSNY is looking at growth opportunities in different segments — what are these segments? Why would the new target customer buy KSNY?

The originally targeted customers are professional women, age 25 to 44, with $100k+ in annual income, married, urban or suburban, and highly educated though demographics. Except the loyal customers, KSNY has growth opportunities in other segments. The first one is the younger customer, age 16 to 24, who love the brand but don’t feel ready to purchase. The second one is the women between the ages of 45 to 49, who has a low awareness level than core customers, but if they aware the brand, they would like to buy. Hence, KSNY finds that its targeted customers should extend and can be segmented by psychographics though market research. There are three like-minded groups, and the first one is to purchase fashion to feel appropriate for each occasion, who are mainly under age 30. From the exhibit 4, the shoppers, age between 16 and 29 are occupied 41%, the shoppers, age between 30 and 39 are occupied 35%. The second segment is the person use fashion as a treat, who are a bit older between 40 and 49. From exhibit 4, the shoppers at these ages are occupied 24%. The third segment sees fashions as useful for everyday wear, who are stay-at-home moms. From the exhibit 4, there are 18% stay-at-home moms, and the KSNY owners are 14%.