New York: Ralph Lauren, today, presented its strategic growth plan, “Next Great Chapter: Accelerate” in a meeting with investors.
The meeting aimed to discuss the global luxury brand’s plans for long-term growth for sustainability with a focus on value creation and to analyse the Company’s long-term financial outlook.
Chief executive officer and president, Patrice Louvet, commented saying,
“Our clear and choiceful strategies are expected to deliver sustainable long-term growth and value creation – fueled by our strong balance sheet and operating discipline – as we reinforce our position as a leading luxury lifestyle company.”
The American global corporation plans to exceed Wall Street’s estimates of sales growth in the next three years by targeting to acquire new customers and raise prices.
Ahead of its meeting with investors, Ralph Lauren announced its plan to target mid-to-high single digits in revenue growth in the next three fiscal years. The brand’s new financial outlook includes the fiscal years through the first three months of 2025.
The growth strategy plan stands on three concrete pillars:
- Elevate and energise their lifestyle brand – global expansion and elevation of lifestyle brand positioning, focus on acquiring new consumers, and increasing Customer Lifetime Value through retention.
- Drive the core and expand for more – focus on driving iconic core products but at the same time drive under-penetrated yet high-potential products as per the consumers’ changing lifestyles.
- Win in key cities with their consumer ecosystem – cohesive and digitally forward ecosystem strategy to be spread across their top 30 cities around the world.
These three pillars have been built on the company’s strong foundation, spread across the last four years of strengthening and enhancing its core capabilities.
This includes the company’s rigorous and continuous efforts to deliver the top digitally-advanced technology, excellent operational execution, and a balance sheet and leadership in Citizenship and Sustainability that exudes power and strength.
They have also worked towards closing stores that have been severely unproductive and at the same time ensured cutbacks on promotions.
Ralph Lauren’s Continuous Brand Elevation
Over the next couple of years, Ralph Lauren aims to implement its strategic plan by continuing to increase the average prices of products in the mid-single-digit range and not relying on discounts or promotions to drive sales.
This has proven to be quite effective for the brand in not just boosting their sales but has also helped elevate the brand’s clientele by creating a niche for new, affluent consumers.
The brand has also seen an increase in its “average unit retail” by 64% since 2018 by increasing sales via its stores and websites instead of focusing on promotional sales from departmental stores.
Louvet explained that the company won’t be indifferent to the environment it operates in but at the same time will not drive sales using “aggressive promotional activity.”
The brand also acknowledges that its female consumers have a monopoly over the sales the brand generates. The female clients regularly come to shop for their male friends and family.
Keeping this in mind the brand aims to grow its women’s range in the long term and ensure that the sales from the category make up for half of the brand’s sales. Thus, targeting a 30 percent increase from now.
