Case Analysis Harrington Collection

Case Analysis: Harrington Collection

MKT 6301.006 - Marketing Management

Brian Harris

BWH140030

University of Texas at Dallas

November 8, 2016

Case Analysis: Harrington Collection

In January of 2008 Sara Huey had a decision to make; should Harrington Collection deviate from its dominate position in “high class fashions”1 and move into the active-wear market or pass on this segment of the market as they had done before.  Huey had to decide if Harrington Collection was as strong as it had been in the past, did active-wear fit within the Vigor line, would it harm the brand image, and would entering this market prove to be too costly in the end?

Apparel Industry: 2007

Recently the apparel industry had been in a state of decline in terms of price and quality, the industry is moving toward more low cost, import products serving a more price sensitive customer base, who often waited for sales or shop at discount and overstock stores. Although total sale had been increasing at an average rate of 4.66% since 2002, the growth was in items less than $100 dollars with approximately 1% annual growth in the under $50 category and a .5% and 1% decline in the +$200 and $100-$200 categories respectively (Table 1).

Harrington’s Position

        Harrington Collection has always been positioned as a leader in high fashion women’s clothing with its diverse brands from Harrington Limited serving the highest end customer with prices ranging from $500-$1000+ to Vigor on the low end with prices between $150-$500. The target customer is similarly segmented, the Harrington Limited customer is an affluent, college educated woman between the age of 35-60, Herrington has 20% market share in this segment. The Vigor customer is a younger woman aged 25-50 with a lower income level of 75K+, Herrington has only 7% share of this segment. As shown the average price of women’s clothing is gradually declining with the growth going to the more casual lower price point brands priced below $100 dollars. This customer is more more closely aligned with the Vigor Brand but is contributing little to Harrington Collection as seen in the continual decline in revenues and more importantly profits. Herrington’s position in higher end clothing and its commitment to producing its clothing in US, Mexican, and Caribbean factories has driven its COGS at a higher rate than its competitors reducing its margin and profits.

Vigor

The Vigor clothing line is closest to the market growth of any of Harrington’s lines. Vigor is positioned as a “better” brand catering to the younger customer who is a trendsetter. Its main products are career wear, blouses, pants, dresses and coats priced between $150-$500. Herrington focusses on a push marketing strategy giving support to its dealers and strong national advertising campaigns. This puts it in a strong marketing position to enter the active-wear segment. The projections for the segment to double by 2009 with 40% of products expected to be at the “better” level and price point makes it an even better fit with the Vigor line.