During the recent Canadian Marketing Association conference I had the opportunity to hear about the Joe Fresh brand straight from the source. Craig Hutchison* sat down with ten of us for a breakfast session titled ‘Joe Fresh takes on Manhattan: Why are we smarter than anyone else?’ Here’s what I learned.
*Senior Vice-President, Apparel, Home & Entertainment, Marketing & Public Relations, Loblaw Company Limited
In just five years Joe Fresh has become the fourth largest clothing brand in Canada (behind George, Fruit of the Loom and Old Navy). With annual revenues near $1-billion, the brand is so successful that standalone stores are now popping up across the country. Expansion plans now include a flagship store on Manhattan’s Fifth Avenue in a landmark location. Three additional stores are planned for New York. All this from a brand that began in a Canadian grocery store. Of course the involvement of Joseph Mimran of Club Monaco fame hasn’t hurt.
The promise is simple. Fashion forward at a surprising price.
To deliver this Loblaw keeps things simple. They know they can’t dilute the brand with too many product extensions or over complicate things with too many sku’s. Prices are rounded to the nearest dollar. The brand message is focused. Surprise and delight is the goal.
To build the brand Loblaw used existing in-store traffic and focused on the product. Television has been a key piece of building brand awareness and perceptions. There has been very little consumer research outside of annual brand equity benchmarking. Public relations efforts focused on events such as the Toronto International Film Festival and Fashion Week. Social media is a recent addition with 30,000 friends on Facebook
and 9,000 on Twitter
. User generated content has a 6-1 ratio on Facebook, illustrating the high level of engagement by loyal customers.
There are critics of the brand’s move into the U.S. Other prominent Canadian retailers have failed before (Canadian Tire, Future Shop, Danier, Harry Rosen, La Senza, Loblaw’s grocery business and arguably Tim Hortons). But on the other hand lululemon now has more stores in the U.S. than Canada (82 versus 45). With the strong dollar and availability of real estate in the U.S. Loblaw feels the time is right. Joe Mimran is bullish, predicting up to 800 U.S. stores within five years. Allan Leighton, president of Loblaw is a bit more tentaive – “It’s very much a pilot.”