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Brand Communication Strategy Analysis – Calvin Klein; Luxury Goods

One of the most well-known fashion companies in the world, Calvin Klein Incorporated is present in a wide range of product categories, including watches, leather goods, fashion accessories, fragrances, home furnishings, and luxury goods. Australian customers are increasingly willing to spend money on high-end products and services, making the country an important market for luxury brands.

In Australia, the market for luxury products is anticipated to expand by 8% annually over the next five years, according to a Deloitte analysis (Deloitte 2022). In 2023, the demand for luxury goods will generate US$7.04 billion (AUD10.26 billion) in revenue. The market is anticipated to expand by 3.77% yearly (CAGR 2023-2027). Luxury Fashion is the market’s largest segment, with a market volume of US$2.92 billion (AUD4.26 billion) in 2023 (statista 2022).

An increasing number of wealthy consumers are driving the luxury industry in Australia, especially in large cities like Sydney and Melbourne. The nation’s robust economy and high standard of life also influence the demand for luxury products and services (Cummins 2022). In 2023, per-person revenues of US$267.30 (AUD389.67) are produced, based on population statistics (statista 2022).

The growth of online shopping is a significant component of the Australian luxury sector. Throughout the nation, many luxury brands have built up a sizable online following that lets buyers access exclusive goods while buying from the comfort of their homes. By 2023, internet sales will account for 22.7% of the market’s overall revenue from luxury goods sales (statista 2022).

Consumers today are becoming increasingly interested in open, sincere, and socially conscious brands. In response to this tendency, Calvin Klein has promoted its dedication to ethical and sustainable production procedures in all of its brand messaging (Calvin Klein n.d.).

Also, consumers are looking for brands that share their values and beliefs and are inclusive and varied. In an Adobe survey, 38% of participants said they are more likely to buy goods and services from companies that feature diversity in their advertisements, and 34% said they have at least once boycotted a business or brand because they didn’t feel their identities were reflected in the latter’s advertisements or other actions (CMO.com Team 2019).

Marketers have tapped into the urge for digitalisation among consumers. Consumers could previously only get a sense of a brand’s image through physical storefronts or offline activities, but it is now accessible online.

The expansion of the market has been used by other businesses as well. After switching to an operating profit in 2021 as revenues rose beyond pre-pandemic levels in the year’s second half, luxury goods group Armani reported a 20% gain in sales at constant currency in the first half of 2022 (Reuters 2022). Giorgio Armani has used technology to improve the client experience while being inventive in its digital communications.

Several businesses compete with Calvin Klein by offering goods similar to those of Giorgio Armani, Hugo Boss, Ralph Lauren, and other names. In addition to these labels, well-known fashion names like Tommy Hilfiger and Chanel also have a presence in Australia. The business model is similar to other brands, using digital channels to reach customers. Also, Chanel makes significant investments in marketing and advertising, focusing on print and television campaigns and the organisation of exclusive events for its clientele.

Luxury brands in Australia have different target markets depending on the particular brand and the good or service being provided. But, in general, luxury brands in Australia tend to target high-net-worth people (HNWIs) who are willing and able to spend a lot of money on luxury goods and services. HNWIs spent an average of $13,000 on luxury goods and services over the previous 12 months (Kaura 2015). The age range of the target consumer for premium brands nowadays is 25 to 44, and they represent 64% of the viewership as a whole. In addition, Generation Z, the younger group between the ages of 16 and 24, make up a sizable portion of the target market (DePino 2023).

In Australia, Calvin Klein targets a broad spectrum of customer demographics. The company offers various products that appeal to different age groups and lifestyles and caters to both men and women. On the tail end of Calvin Klein’s 2021 Pride campaign, Calvin Klein declared “[Our target audience member] could be somebody who’s 19 or somebody who’s 55” (Clark 2021).

Based on the available target market data and marketing communications, Calvin Klein has two key customer persona’s that they are targeting; Urban professional Kurt and Fashion enthusiast Amy.

Kurt is a recent graduate or young professional. He is in his 20s to early 30s and makes middle to high income, so having a successful profession and stable finances are very important to him. He chooses to live in cities because he appreciates the energy, diversity, and vibrant social scene. He favours business-appropriate, slick, and intelligent fashion styles. Kurt uses the internet to share his life, experiences, and images, among other things, making it an integral part of his daily life.

Because Amy has always had money, she has never had to worry about it. She is wedded. She is in her early to mid-30s and constantly searching for cutting-edge fashion trends. She is prepared to spend more on designer clothing.

Calvin Klein maintains an established customer value proposition by continually delivering on its brand promise and abiding by its fundamental values. The company has established a reputation for quality, style, and innovation, and it has a clear and distinct image that appeals to its target market (Calvin Klein n.d.).

The positioning approach Calvin Klein uses in the market is centred on the preferences of its customers and the brand promise (please see below Figure 1 and Figure 2).

Figure 1: Positioning Map; Style vs Price

Figure 2: Positioning Map; Style

The positioning of Calvin Klein in Australia may be summed up as a premium fashion brand that provides excellent, contemporary, and cutting-edge products for both men and women. One of Calvin Klein’s main value propositions is to emphasise a contemporary, minimalist style. Because its designs are timeless and not unduly trend-driven, Calvin Klein’s simple look also helps the company stay in fashion season after season (pvh n.d.). Calvin Klein’s dedication to quality and innovation is another essential value proposition. Customers who care about the environment and value ethical production will be drawn to Calvin Klein because it uses advanced technologies and sustainable production methods (Calvin Klein n.d.). Calvin Klein also places a lot of emphasis on branding and marketing, which aids in developing a distinctive character and winning over customers. A feeling of brand identity and uniqueness in the market is aided by the company’s instantly identifiable emblem and frequent use of provocative and vivid imagery in its advertising campaigns.

Hugo Boss and Calvin Klein are positioned in terms of price and style in the minds of consumers. Hugo Boss is typically considered a more expensive luxury brand, whereas Calvin Klein is positioned as an approachable brand with a broader range of price ranges (Extrabux n.d.). Hugo Boss has a more enduring and recognisable style than Calvin Klein, which is more modest and modern.

Calvin Klein’s brand communications strategy in Australia has a strong focus on digital channels. The brand uses a range of digital marketing tactics to engage with customers and promote its products.

Social media: Calvin Klein has a strong presence on social media platforms such as Instagram, Facebook, and Twitter. The brand uses these platforms to showcase its latest products, engage with customers, and share content related to its sustainability and social responsibility initiatives.

Influencer partnerships: Calvin Klein has collaborated with influencers and celebrities in Australia to promote its products and increase brand awareness. The brand has worked with well-known Australian personalities such as Lara Worthington and Sarah Ellen.

(Source: Life Without Andy)

Email marketing: Calvin Klein uses email marketing to communicate with its customers, sharing product updates, promotions, and other relevant information. The brand’s email communications are personalized and tailored to the preferences and interests of individual customers.

(Source: Smaily)

Website and e-commerce: Calvin Klein’s website in Australia is a key part of its brand communications strategy, offering customers a seamless online shopping experience. The website features high-quality imagery and product descriptions, as well as information on the brand’s sustainability and social responsibility initiatives.

By pushing video content and utilising influencer marketing, Calvin Klein can further establish its performance and image, according to an analysis of its social media strategy (refer to figure 3). Calvin Klein creates beautiful visual content but doesn’t frequently create video content, which can hinder its potential to connect with and engage viewers who prefer video content. Calvin Klein might attract viewers who prefer video content and boost engagement by including more video material in its social media strategy. In addition, although the business has worked with influencers on influencer marketing projects, Calvin Klein does not frequently include them in its social media material, which could limit its appeal to and interaction with younger audiences. Calvin Klein might reach new audiences and boost its social media engagement rates by working with more influencers and micro-influencers.

Figure 3: Calvin Klein Social Media SWOT Analysis

Calvin Klein constantly creates creative and aesthetically appealing content that engages its audience and strengthens its brand identity to influence consumer perceptions of the company’s quality and credibility. Its social media platforms share a similar visual identity, which contributes to building a solid and recognisable brand identity. Additionally, it interacts with customer mentions on social media platforms.

Overall, Calvin Klein has numerous potential to create a new brand communications strategy in Australia that uses cutting-edge technologies and is centred on building a strong sense of community and customer interaction. The brand may increase its market share in Australia and establish enduring bonds with consumers by investing in these sectors.

Appendix 1.

Calvin Klein Competitor Digital Analysis

Website

Website Analytics (similarweb.com)

Calvin Klein

https://www.calvinklein.com.au/

features a sleek and modern design with minimalist aesthetics that reflect the brand’s minimalist and sophisticated style.

high-quality product images, simple and easy-to-navigate menus, and a consistent color scheme.

The typography used is simple and elegant.

399K average monthly visits for the last 3 months to January

3:32 (min:sec) average visit duration

5.99 pages per visit

38.9% bounce rate

Top traffic sources: 44.65% organic search, 34.83% direct, 17.28% paid search and 1.41% from referrals

Giorgio Armani

https://www.armani.com/en-au

features a clean and sophisticated design that reflects the brand’s luxurious and elegant style.

a muted color palette with black, white, and shades of gray, which complements the brand’s minimalist design aesthetic.

The typography used is simple and classic.

high-quality product images, with a focus on showcasing the craftsmanship and detail of each garment. Navigation is often intuitive and user-friendly, with menus and sub-menus that help users find what they are looking for quickly and easily.

3.7M average monthly visits for the last 3 months to January

2:48 (min:sec) average visit duration

5.09 pages per visit

48.29% bounce rate

Top traffic sources: 45.83% organic search, 31.3% direct, 14.89% paid search and 3.85% from display

Hugo Boss

https://www.hugoboss.com/au/home

features a modern and sleek design that reflects the brand’s focus on classic fashion.

a black and white color palette, with accents of bold colors, reflecting the brand’s minimalist design aesthetic.

The typography used is clean and modern, with sans-serif fonts and plenty of white space.

high-quality product images, with a focus on showcasing the fit and quality of each garment. Navigation is often straightforward and user-friendly, with clear menus that help users find what they are looking for quickly and easily.

7.4M average monthly visits for the last 3 months to January

3:05 (min:sec) average visit duration

4.82 pages per visit

48.49% bounce rate

Top traffic sources: 33.28% organic search, 30.26% direct, 21.29% paid search and 5.76% from display

Ralph Lauren

https://www.ralphlauren.com.au/

features a classic and timeless design that reflects the brand’s focus on traditional, high-quality fashion.

a blue and white color palette, reflecting the brand’s signature colors.

The typography used is classic and elegant, with serif fonts and plenty of white space.

high-quality product images, with a focus on showcasing the craftsmanship and quality of each garment. Navigation is often intuitive and user-friendly, with clear menus that help users find what they are looking for quickly and easily.

329K average monthly visits for the last 3 months to January

2:39 (min:sec) average visit duration

4.37 pages per visit

38.42% bounce rate

Top traffic sources: 50.28% organic search, 20.42% direct, 14.53% paid search and 6.06% from display

Tommy Hilfiger

https://au.tommy.com/

a fun and vibrant design that reflects the brand’s focus on casual, preppy fashion.

a red, white, and blue color palette, reflecting the brand’s Americana-inspired design aesthetic.

The typography used is bold and playful, with sans-serif fonts and plenty of white space.

high-quality product images, with a focus on showcasing the casual and comfortable style of each garment. Navigation is often straightforward and user-friendly, with clear menus that help users find what they are looking for quickly and easily.

859K average monthly visits for the last 3 months to January

1:37 (min:sec) average visit duration

4.78 pages per visit

54.53% bounce rate

Top traffic sources: 42.59% direct, 40.32% organic search, 12.5% paid search and 2% from social

Chanel

https://www.chanel.com/au/

features a luxurious and sophisticated design that reflects the brand’s focus on high-end fashion and beauty.

a black and white color palette, with touches of gold or other metallic accents.

The typography used is elegant and refined, with serif fonts and plenty of white space.

high-quality product images, with a focus on showcasing the craftsmanship and detail of each product. Navigation is often intuitive and user-friendly, with clear menus that help users find what they are looking for quickly and easily.

12.4M average monthly visits for the last 3 months to January

2:26 (min:sec) average visit duration

3.96 pages per visit

46.44% bounce rate

Top traffic sources: 48.2% organic search, 26.53% direct, 14.29% paid search and 4.85% from referrals

Calvin Klein Competitor Digital Analysis

Facebook

Twitter

Calvin Klein

Approx. 14M likes

Post likes range between 200-15K

Content predominately product promotions, with some brand campaigns content

Approx. 3.8M followers

Following approx. 267

Content similar to Facebook

Giorgio Armani

Approx. 456K likes

Post likes range between 100-300

Content predominately fashion industry news, with some behind-the-scenes content

Approx. 3.5M followers

Following approx. 215

Content similar to Facebook

Hugo Boss

Approx. 8.5M likes

Post likes range between 100-400

Content predominately social and environmental responsibility, with some celebrity and influencer collaborations content

Approx. 708.2K followers

Following approx. 255

Content similar to Facebook

Ralph Lauren

Approx. 9.3M likes

Post likes range between 20-100

Content predominately lifestyle imagery, with some brand stories and history content

Approx. 2.3M followers

Following approx. 325

Content similar to Facebook

Tommy Hilfiger

Approx. 14M likes

Post likes range between 0-50

Content predominately customer engagement, with some event announcements content

Approx. 1.5M followers

Following approx. 1525

Content similar to Facebook

Chanel

Approx. 23M likes

Post likes range between 1K-9K

Content predominately influencer partnerships, with some product promotions content

Approx. 13.5M followers

Following approx. 1

Content similar to Facebook

Calvin Klein Competitor Digital Analysis

Instagram

Youtube

Calvin Klein

Approx. 22.5M followers

Follows approx. 188

Showcase its latest products and promote sales and discounts