The North Face is
an outdoor equipment and apparel company. They make everything from winter
boots and coats to tents and sleeping bags ("The
North Face," n.d.). They have an active social media presence on
the big three sites: Twitter, Facebook, and YouTube. They also have a
Pinterest, Google+, and Instagram
account. They market to outdoors sports people and team athletes. They use
social media mainly as a medium to share photos of the great outdoors taken by
people who are brand ambassadors.
The North Face was
struggling financially when purchased by VF corporation in 2000, a company that
also owns other outdoors brands such as Timberland and Jansport backpacks ("VF Corporation Is Set to Purchase North
Face," 2000). They had already crossed into mainstream appeal as of
2005, as a news article about teenagers stealing the coats off people’s backs
demonstrates ("Suspects Nabbed in Jacket,
Car Robberies," 2005). They had grown significantly by 2010. A goal
for North Face is to increase revenue and increase direct to consumer sales.
They last shared their objective in 2010, and it was to increase to $3 billion
in revenue by this year, 2015 (VF Corporation,
2010). As of 2014, they are currently generating approximately $2.3
billion a year in revenue (VF Corporation,
2015). At this point, an objective of increasing revenue by $700 million
dollars in a year is not realistic.
The North Face
products are available in their own retail stores which exist mostly in major
cities around the US. They are also in outdoors shops such as EMS and REI where
their products will be sitting next to competitor’s products like Columbia
which might have a lower price. They also sell products online through their
own website and through REI. Since they allow other stores to sell their goods
at discount, reaching the consumer directly is a great benefit and can help
raise revenue. In their 2010 goal-setting press release they noted “Currently
accounting for 19% of global revenues, The North Face expects growth in its
retail store base and e-commerce will drive its total global direct-to-consumer
business to nearly 25% of revenues by 2015”(VF
Corporation, 2010). They are on their way to meeting this objective as they
increased direct-to-customer sales 30% in the fourth quarter of 2014 (VF
Corporation, 2015).
The strategy is to
demonstrate that their products are superior quality to their competitors. In
order to do this, their tactic is to is to create the best products, so they
invest in research and development to have products with innovative uses (Arcieri, 2015). Their PR strategy is to appeal
to outdoorsy types with a social media presence that reflects people using
their products in real adventures. Their tactic is to show that real athletes
who use their products for training and in competitions are successful. By
having a successful public relations strategy, they can link people directly to
their website for purchases. An inspired individual might not seek out other
sources to buy the product.
The
reason that North Face takes this strategy of focusing on one specific type of
customer is that this is working for them. They currently capture about 33% of
the outdoor apparel market (Moore, 2015). Their casual customer that only buys
a coat may not even know the origins of the brand or the variety of products
they make. They do appeal to city folks in ads such as this one with a cab
taking random New York City dwellers on adventure, which can help expand their
audience (The North Face, 2015). A city dweller might not have a need for a
tent, so they must continue to appeal to true outdoorsmen and women who can
benefit from their full line of products. A customer who needs a pack, tent,
gear, and shoes will spend more than someone just buying a coat every 3 years.
This customer has more brand value, and is the one that needs to be reached and
converted to a loyalist.
The article by
Moore (2015) states that the North Face is a brand leader by sticking to the
origin story. They do not dilute the image of the brand or the quality of the
products to reach a more general market. Instead they stick to the script.
However, the article by Arcieri (2013)
challenges this assumption, saying that hardcore enthusiasts are questioning
the North Face’s commitment to technical quality. It is hard to argue with the
numbers. Compared to REI, they have similar revenue amounts despite REI having
a much wider product line and more retail locations (Vanderpool, 2015).
References
Arcieri, K. (2015, August 23). Is The North Face
slipping for VF Corp.? Retrieved from
http://www.bizjournals.com/triad/blog/2013/08/is-north-face-slipping-for-vf-corp.html
Moore, F. (2015, February 17). North Face – The
pinnacle of a brand. Retrieved from
http://bigriveradvertising.com/blogs/fredmoore/2015/02/17/north-face-the-pinnacle-of-a-brand/
The North Face. (2014, December 3). The North Face: See for Yourself Cab
[Video file]. Retrieved from https://www.youtube.com/watch?v=iUo6GwEw_Bw&list=PLb8M2N__cpL-2-V7MSmqdp9nEYqC85Nqw
The North Face. (n.d.). Retrieved May 31, 2015, from
https://www.thenorthface.com/
Suspects nabbed in jacket, car robberies. (2005,
February 14). Retrieved from http://www.washingtontimes.com/news/2005/feb/14/20050214-104619-4377r/
Vanderpool, V. (2015, March 23). REI revenue hits
all-time high in 2014. Retrieved from
http://www.bicycleretailer.com/retail-news/2015/03/23/rei-revenue-hits-all-time-high-2014#.VWtV-0_BzGc
VF Corporation. (2010, December 15). VF Corporation's The North Face(R) brand:
Geared for growth [Press release]. Retrieved from
http://www.vfc.com/news/press-releases?nws_id=9777F06A-7746-000A-E043-A740E3EA000A¤t_page=1&strKeyWords=North%20Face
VF Corporation. (2015, February 13). VF reports 2014 fourth quarter and full year
results; Announces outlook for 2015 [Press release]. Retrieved from
http://www.vfc.com/news/press-releases?nws_id=0EF80514-889E-6030-E053-A740E3EA6030
VF Corporation is set to purchase North Face. (2000,
April 08). Retrieved from
http://www.nytimes.com/2000/04/08/business/company-news-vf-corporation-is-set-to-purchase-north-face.html
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