Introduction
Phillips Van Heusen is a Manufacturing Corporation based in America. It is one of the world leading clothing companies and is widely known for manufacture of shirts. Its main headquarters are in Manhattan but has other administrative offices at Las Vegas, Los Angeles, New Jersey, Nevada and Bridgewater. It also has several other distribution facilities in different places in America and several other sourcing facilities worldwide (Phillips et al 205). The Corporation came to being early in the 20th century when Jones Van Hussen and Moses Phillips, both of who did shirt business decided to merge to form a single corporation. The corporation was later renamed in 1950s as Phillips Van Heusen Corporation (Reuters para 2). The corporation has since then managed to secure several patents and licenses for their shirt innovations brands. The company has diversified its business and is now producing various men and women clothing. The company has grown through expansion to new markets and acquisition of other fashion companies. It also has a strong marketing strategy which has contributed to its success.
Marketing strategies
Phillips Van Heusen Manufacturing Corporation has a comprehensive marketing strategy through which various brands are introduced to the market with targeted customers. Some of its most popular fashion brands include Tommy Hilfiger, IZOD, G. H. Bass, Calvin Klein and Arrow. Izod started as an independent clothing company but was purchased by Phillips Van Heusen Corporation in 1995. The corporation has introduced various brands and product lines which are identified by Izod logo. Some of the clothing bearing the Izod trade mark includes Polo Shirts, shoes, suits, outerwear, fragrances and neckties. The collar shirts were among the popular brands Phillips Van Heusen Corporation has ever introduced in the market. In the year 2000, the collar shirts were rebranded after the corporation acquired the Arrow brand. The Arrow brand was a more appealing collar shirt which attracted a lot of consumers (PVH 42). Calvin Klein brand was introduced as Phillips Van Heusen Corporation brand after Calvin Klein Incorporation was acquired in 2002. Calvin Klein acquisition introduced a new business line involving manufacture of underwear, swimwear and jeans all which are branded as Calvin Klein. In 2010, Phillips Van Heusen Corporation managed to make yet another strategic acquisition of Tommy Hilfiger Corporation which added high quality clothing products such as women’s and men’s apparel, denim, sportswear. In addition, Tommy Hilfiger also introduced licensed products such as home furnishings, fragrances and accessories all which are branded with Tommy Hilfiger Corporation logo (Sterlacci and Arbuckle 167).
The corporation’s marketing strategy is based on its objective to stay true to unique identity of each brand to strap up power for each brand in order to inspire unfathomable and long-lasting relationship with consumers. Strengthening the brands will enable them to increase market share globally and bring about opportunities for growth. Maximization of the brand potential is complemented by the corporation’s effort to reach the customers wherever they are and meet their needs through their demand oriented designed products. In the beginning of the year 2013, the company acquired Warnaco; a well established apparel company in Latin America and Asia, to enable PVH enhance the reach of Tommy Hilfiger and Calvin Klein Brands. The company also tries to leverage a mix of licensing, retail and wholesale strategies so as to allow a fair competition for a simultaneous success and the overall success of the corporation.
Target Customers
Phillips Van Heusen has a wide range of customers. The customers’ special needs are catered for by the various brand businesses. Each brand business targets a specific class of customers and produces its products depending on the specific requirements (Barbara 76). The Tommy Hilfiger business has brands which mainly targets consumers of 25 to 45 years of age while the Hilfiger Denim targets consumers aged 25 to 35 years. Both Tommy Hilfiger and Hilfiger Denim brands produces a range of products for men, women and children. Calvin Klein brands are tailored to suit both men and women consumers. These products targets customers from all parts of the world. According to Reuters (Para 9) 60% of the company’s revenue in 2012 was generated from international sales while 40% was earned locally. The Heritage brand business targets male consumers. It designs and markets dress shirts and neckwear for men.
Promotions
The company has committed its resources to create awareness among consumers through advertisement and public relation projects. Most of the company’s advertisements reflect the lifestyle of people rather than the specific product. The brands are advertised through social media outlets, e-commerce platforms and other forms of digital media. The company also sponsors sports like football to advertise their brands. The company recognizes uniqueness of each consumer and approaches their needs in a diverse manner in pursuit of competitive demands. The Social Responsibility Report 2008 (25) indicates that the company workforce participates in various community support activities. For example the company has PHV Cares Campaign which deals with spotlight issues in the community such as health, environment, children and family or education.
The corporations promote its brand in an influencing manner to grow audience and engage the loyal customers. In 2010, the corporation ran one of its best multi-media campaigns called ‘Van Heusen Institute of Style.’ This campaign was designed by Steve Young and Jerry Rice and aimed at providing ties with fashion through various football heroes. Recently the corporation has expanded this campaign to encompass social media, television, print and digital media. The company has of late collaborated with the ‘Funny or Die’ website to publish ‘Institute of style’ video which is customized targeting the young male consumers.
Licensing Agreements
Licensing is an important source of revenue for Phillips Van Heusen Corporation. The corporation through various business brands makes business arrangements with licensees and other third parties from all over the world. According to the annual report 2012 (42), the licensees distribute various products in different geographic regions and also help in marketing and expand the lines of business. The licensing agreements are exclusive of products and territories. For example, by the end of year 2012, Calvin Klein business had managed to issue over 50 licenses among other arrangements. One of these licenses is the CK21 Holding Pte, Ltd which is specific for Men’s and Women’s apparel, accessories and shoes in the Asian territory except in Japan.
The PHP licensees plays vital role in distribution of the company’s products and ensures that all consumers are able to access various products conveniently. The licenses bring revenue to the company directly and also help in marketing the company’s brands (Plunkett 14). However, the company is at a high risk of losing popularity of its brands in light of the many licenses offered as they can dilute the logos prestige and the overall company’s reputation. Nevertheless, the company has gained from these licenses and its revenues have been comparatively high.
Apparel product lines and price ranges
The apparel industry is characterized by large, medium and small producers making it very competitive. The global status of the PVH Corporation brings diversity and different fashion orientation of consumers. The Corporation therefore has to consider all these factors when making decision on the best pricing strategy for a particular brand of products. The presence of numerous foreign and domestic designers, assorted brands, retailers and manufacturers of clothing, footwear and accessories has made the company to adopt a more efficient manufacturing strategy to ensure that its product are of the best prices in the market.
Global sourcing Strategies
The corporation sources its product from different parts of the world. According to the PHV Annual Report 2012, the corporation made production in over 50 countries in it’s over 700 factories worldwide. The company sources both finished goods and raw materials. To prevent shortages of stock of raw materials and other production hitches, commitments are made ready for a period of two to six months before productions. The quantities to be produced are also finalized at this time. The company has foreign buying agents and administrative offices which help in gathering enough raw materials for its production.
The PVH corporation sourcing strategies are aimed at enhancing ability to to provide consumers with products and deliver them on time. The company has therefore improved its efficiency in product sourcing by contracting third parties in some of its business line to provide the required products. For example, Tommy Hilfiger is in a contract with Li $ Fung Trading Limited. Li & Fung is required to carry out product sourcing to a tune of 54% according to the terms of agreement (Bassi and Grant 11). Tommy Hilfiger also has several other product sourcing third parties. The company acquisition of Warnaco is also expected to bring synergy in product sourcing after its sourcing network is integrated (Smith, para 3). This will bring efficiencies in the production and increase the profit margin.
Quality Control procedures
Phillips van Heusen Corporation has offices and buying agents in different countries which ensures that goods manufactured are of high quality. These offices also ensure the services run smoothly by controlling the delivery performance of the suppliers (Harrigan and Harrigan 62). The corporation is also able to stimulate consumer tastes and respond to product demands through the design of their products (Waites 2). This way, the company is able to remain competitive in terms of quality.
Conclusion
Phillips Van Heusen Corporation is a global organization which is well positioned in the market. The systematic sourcing, production, distribution and pricing of its products improve the competitive edge of the company. The ability of the company to acquire and enter into business agreements with other apparel companies and licensing its brands is a unique means of business which has brought about significant growth in the company. Nonetheless, the complex management system of the company need to be strengthened according to the increasing expansion of business to ensure that it does not bring about operational difficulties in future (Marsh 177). The corporation acquisition strategy should be implemented to ensure that the company brands maintain their identity. With well recognized brands the corporation is likely to withstand the volatility of fashion trends which may make the company to be overtaken by the competitors. Nonetheless, having different business lines should not substitute to innovation.
Works cited
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