Keeping an established brand relevant and popular over time is a tough challenge, especially as the market becomes more competitive with the arrival of new and international players, writes Meg Lustman, chief executive of Hobbs.
Hobbs spring 17
As the world has become a smaller place, many brands have been faced with the question of how to capitalise on the business opportunity presented by international expansion while staying true to their heritage.
The most important first step when considering international development is to find markets and customers who will respond positively to your brand’s proposition. To manage this successfully, you must be clear about the customer you serve and what your brand offers her or him. You also need to thoroughly assess the local competitive landscape to be sure that your brand will be attractive and differentiated enough to be successful.
Trading since 1981, Hobbs is a well-known affordable luxury brand with a loyal following. We are in a fortunate position. When I joined the business in 2014, it was clear that our opportunity was to move from being a brand with a strong identity and a highly functional reputation to one with more personality – one that truly engages its customers emotionally by inspiring and delighting them consistently, thereby creating stronger bonds with even more women. I knew that this would stand us in good stead for future expansion internationally.
We spent time really getting to know our customer and what she liked about Hobbs. We very quickly realised that she is an extraordinary woman: she juggles the multiple demands of modern living with consummate ease. She is confident about who she is. Being noticed for the right reasons is important and feeling appropriate is key. No matter what she does or where she lives, there is a common set of values that she cherishes and looks for from Hobbs: quality, feminine fit and timeless, versatile style.
We needed to ensure Hobbs’ product range was right for her – not just for formal work or occasionwear, for which Hobbs has long been a “go-to brand”, but also with a broadened offer for daywear, staying true to our brand values. We also invested in new fabrications and a broader price architecture to ensure that we offered her more reasons to love the brand.
When developing Hobbs’ international footprint, our first step was to identify markets that align with our core proposition and where we know there is latent demand. For Hobbs that means there needs to be a degree of affluence and a high penetration of women who work outside the home. We have also taken care to identify markets where the scale of opportunity is large, as we prefer to remain focused rather than plant flags around the globe at this early stage.
Throughout my career, I have found that the brands that are successful internationally are those that research, test and learn intelligently, and which have the culture and agility to adapt and refine their proposition to a local market’s needs. This agility needs to be managed proportionately to ensure that the adaptations required are kept simple and manageable until the opportunity is proved.
We decided that the best way to “test and learn” in new markets would be to partner with organisations, online and offline, that are catering to customers who share the characteristics of Hobbs’ affluent women. We have leveraged their footfall or traffic and shown a carefully selected edit of Hobbs. We have used these opportunities to learn – the product she likes, the trading patterns she expects and many other idiosyncrasies.
For example, we have learned that Labor Day at the end of August is a key moment for the US customer to shop for her winter wardrobe, and in Germany we know that the concept of a mid-season Sale is not widespread and may cause brand credibility issues with the customer. Once we have experienced the learnings and are clear that there is a strong enough fit between what we offer and what the customer wants, we can scale up and roll out.
For all businesses, there comes a point where the opportunity for international growth needs to be considered and prioritised. International growth is well worth the effort but it will require change to the organisation and does not come cheap. British brands are respected and valued around the world by customers; finding ways to take advantage of this demand without compromising the core business is possible.
Ultimately, the key to our success, which I believe rings true for many other retailers seeking to differentiate themselves in a global marketplace, is to: know your brand and its point of differentiation for customers; ensure the right markets are identified; devote the appropriate investment in terms of time, resource and capex; and set realistic and achievable targets for the journey ahead.