Paul Smith brand analysis by Miika Miinala

ESSEC, Paris. Course "International luxury distribution. Miika Miinala

1. Miika Miinala B00267686Miika Miinala B00267686

2. •Sir Paul Smith (born in Beeston, Nottinghamshire on July 5, 1946 ) was - is still – a
cyclist enthuastic whose dream of being once a professional racer ended with an
severe traffic accident. In the hospital he met creative people and met them also
after the recovery. In these meetings he was convinced that fashion and clothing
would be his destiny. He started to learn tailoring and his designs quickly led him
to retail entrepreneur Harold Tillman who operated in the famous Savile Row
which is famous of it’s traditional tailoring for men. 1970 he opened his first
shop in Nottingham, London together with his wife who had fashion diploma
form Royal College of Arts.
•In 1976 he had his first exhibition in Paris and at the time he gradually moved to
retailing also. First licensed shop in Japan was opened already in 1984 and first
shop in US popped out 1987 in New York and next year the first women
collection was introduced. In 1990 company opened first franchise in Hong Kong
and 1991 first Japanese flagship store joined the rest of the 60 retail locations in
Japan.
•In 1990s the retail chain was extended to new Europe an and Asian countries and
new product lines such as children’s wear, perfumes luggages , footwear,
accessories and even Paul Smith Mini cars.
•2000s have seen Mr Smith getting the knighthood and his company growing ever
larger both in product lines (for example swiss watches and furniture) and
number of retail locations. Company has shop presence in all the major luxury
markets – although almost absent in South America – and products are sold
approximately in 75 countries. In 2007 Mr Smith sold 40 percent of his company
to his Japanese licensee, Itochu. In 2008 the company had 95 retail stores
worldwide and the turnover had reached 346 million £.
Company HistoryCompany History

3. Concept Concept

4. •Paul Smith brand is very much about personality, story and
design style and vision of Sir Paul Smith
•For gentlemen, London chic and creative people
•English, also name = ”Paul Smith”
•Trademark stripes,colourfulness and roses
•Unconventional, classic with a twist
•Tailoring tradition and added wackiness
•Made in England and Savile Row heritage
Thanks to the fact that Paul Smith has been always been the creative
director of the brand, it has maintained its brand identity which derives
heavily from the personality nad personal life of the owner. The brand has
stayed true to the Sir Smith’s vision and persona. That is, never truly
growing up and finding inspiration everywhere.
Culture and sources of Culture and sources of
identityidentity

7. ””Targeted” consumersTargeted” consumers

8. Brand PositioningBrand Positioning
•Paul Smith brand is well positioned in its industry. Shops are create
examples. Paul Smith stores differ like night and day from Burberry
stores and in fact any other classic luxury brand stores. One can’t mix
Paul Smith shop with any other luxury brand. With it’s eccentric and
whimsical identity + upper class english tailoring heritage + the persona
of the Mr. Smith and traditional luxury locations it is unique company in
global scale luxury industry.
•Price vice, Paul Smith mainline, suits and some other collections are
luxury, but some collections are more accessible a.k.a masstige.
However it is clearly luxury brand when you look the average –high! –
prices in the shop.
•Products vice, Made in England, high quality materials and designer
designed. Long lasting and timeless. Although not the high high end
luxury like say Hermes and Rolex which are made/said to last forever.
•Service vice, average in the luxury industry. After sales services are not
very exquisite, but in-hoouse tailoring is rare for any brand.

9. Mass market competitorsMass market competitors
First of all the Paul Smith brand is well
positioned within the luxury market because
brand is quite unique in the designs. The most
obvious competition on mens’ side comes from
other luxury suit and men apparel makers, both
English and foreign, such as Ralph Lauren
Burberry Dunhill, Armani and Hugo Boss.
Comme des Garcons has also same kind of
appeal in its brand as Paul Smith.
On womens’ side the competition is broader
because the designs are more universal and the
clothes vary from expensive street wear to
evening dresses. Obviously other eccentric
British designers such as Jonathan Saunders,
Giles and Matthew Williamson pose a threat.
Paul Smith designs are also compared to Eley
Kishimoto and Duro Olowu. On women’s side
the competition is still more with other succesful
luxury brands, such as Gucci, Prada, Dior,
Chanel. Which are on the same streets and
command same prices.

Paul Smith could be labelled also as elite
street brand, because it is also credible
brand among those who despise or don’t
feel so comfortable with the classic luxury
brands – a brand building well done!
Fast fashion brands like H&M, Clio, Zara
can always offer product lines that are
Paul Smith-ish, but can’t compete directly
with it. Diesel , Fred Perry, and various
other street credible brands are the
more affordable substitutes for Paul
Smith Jeans and Red Ear collections.
Paul Smith Ltd has however steady
growth rate, even in the recession, so the
competition from the mass market side
poses no serious threat and it should not,
given that is luxury brand .Fluctuations on
global tastes and habits could see mass
market gainging market shares from
luxury brands, but that is not probable in
the near future.
Luxury market competitorsLuxury market competitors

10. brand as a...brand as a...
Person Product
Symbol Organization

11. Credibility,
Eccentricsm
Trademark stripes
& English quality
tailoring
Playful, creative class
and/or adores creative people.
Sir Paul Smith himself
English, Savile Row.
Sir Paul Smith.
Timeless
Fashion credible,
gquirky entleman,
doesn’t search the
most obvious.
Individuality
High-quality,
credibility ,
unconventionality
Relationship
ReflectionSelf-Image
Culture
PersonalityPhysique
Brand Identity prismBrand Identity prism

12. Exclusivity and Dream Factors in Product Offering in a Nut ShellExclusivity and Dream Factors in Product Offering in a Nut Shell

13. The world of Paul Smith is exctiting, credible, cool, fashionable, approved in Brick Lane
pubs and snowboard and skateboarding circles, but also in FTSE and Savile Row and
Parisian catwalks.
The personality and the story of Paul Smith makes you dream and marvel also. From the
revelation that he wanted to do clothes he has turned to humble english gentleman – at
public at least – and millionaire retail entrepreneur and the most succesful english
designer who got knighthood. To his own words he just wants to travel and discover arts
and music everyday and offer his findings to other people and would never ever go
public with his company which is debt free. Stuff of dreams and refreshing attitude in
the double digit growth targets of luxury industry, definetely.
“He comes across as a normal guy you’d wanna hang out with; he’s down-to-earth, likes
biking and football… you might even find him working in one of his own shops.” Fashion
blogger on Paul Smith.
Every design and accessory includes the trademark stripes which are known through
out the fashion world. Staying true to english high society designs with a twist and
casual t-shirts and trainer shoes go hand in hand. These two product categories
reinforce each other in very clever way, which is not possible for many brands.

14. Street fashion credibility refers here to the fact
that Paul Smith is very keen to collaborate with
brands that produce subculture products that are
widely recognized as strong , legendary or even
unique brands in their field. This makes the brand
more known and more credible outside the luxury
industry.

15. Luxury side of the brand: collections are presented
catwalks, world of fashion, Savile Row heritage of
tailoring, high quality materials and designer products.
Product to be found in extravagant shops on luxurious
locations such as Fue Fabourg St-Honoire, 5th Avenue,
Shibuya. Exclusive Bespoke tailoring and limited editions
are also used for example Paul Smith for Evian and Audio
Technica stereo headphones collaborations are limited
edition. Suits and dresses speak exclusivity when jeans
and shirts promise accessibility.

16. Sir Paul Smith is also keen art collector and does lot of
projects with artists and musicians. Most of the
company’s shops also sell wide variety of books (often
signed by authors) from design to pthotographing,
music, sports and locations. This is not new to luxury
brands,but Paul Smith differentiates a bit from the basic
luxury brand by concentrating more on the subcultures
and more unorthodox, daring and eclectic forms of art
and artists – contrast to high culture – and often
collaborating with the artists and using his blog to
promote the exhibitions, museums and artists he likes.
He also hosts many exhibitions. In Japan, he has Space
Gallery shop where one floor is dedicated for artist
exhibitions. Art + Paul Smith products = dream factor.
Other shops host every know and then some
exhibitions. Paul Smith also collaborates with
Manchester United football team and cycling firms
Rapha and
Mercian Cycles.
60s’ Psychedelic
Rock Posters
Rock Heroes Exhibition and
Gibson guitar by Paul Smith
Paul Smith for Manchester United
Mai 68 collaboration
Dream Empire by
Tanaami in Space
Gallery

18. Prices Prices
• Paul Smith brand has over 20 product lines: 5 for men, 3 for women, Spectacles
for both women and men, watches, shoes, Albemarle Street furnishing, Bespoke,
fragnances, Fine China, Gainsborough silks , Rugs, children wear, gifts, sunglasses
,accessories and books.
•The price range of these collections vary. Some of them are clearly made to offer
accessibility for the first time buyers such as Paul Smith Jeans collection where t
shirts begin at 40€.
•Price* premium of the ”Paul Smith” men and women mainline collections are set
to signal exlusivity:
- Jackets from 480€ to 800€
- Wool jumpers from 240€ to 350€
- Womens’ dresses 220€ to 1300€
- Womens’ jumpers and cardigans from 220€ to 440€
- Suits from Paul Smith London collection are around 730€
* Prices are converted to Euros with 1,10/1. rate. Sterling is
weak still at the moment. This makes comparison tricky, but the
figure give the good iderafrom the prices .

19. Price Premium compared to competitor in Price Premium compared to competitor in
the luxury sectorthe luxury sector
Prices are approximated averages acquired
from the brand online shops. Different
collections are considered when looking for
average.
Paul Smith Dunhill Hugo BossArmani Burberry
Jacket, Blazer 600 800 no 800 550
Shirt (for suit) 130 125 136 130 220
Jeans 150 130 165 200 220
Knit/wool 290 250 180 300 300
Suit 730 no 725 850 800
Paul Smith is price vice definetely luxury. It can’t or it doesn’t want to use price premium
similar to more known brands such as Armani and Burberry. But it wants to be more
exclusive than Hugo Boss or Dunhill which are not so known for their designers or
tailoring heritage. It justifies its locationing in places like Rue Faubourg Saint Honoré ,
when Hugo Boss is ”just” in Rue Saintt Honoré. Brand signal that it’s high end luxury, not
middle end .This is true especially when pound was still rated at 1/1,5€.

20. Price Premium compared to competitor in Price Premium compared to competitor in
the mass and middle market sectorthe mass and middle market sector
Paul Smith’s direct competitors at mass market are hard to point out because
of the positioning of the brand. Zara, Gap and H&M offer the individuality fast
and cheap. Brands like and Fred Perry and Diesel have similar kind of appeal
in their brands and they are not in the high end f the luxury spectrum.
Generally speaking, Paul Smith designs seeks timelesness and high quality
rather than fast fashion. Prices are ten times higher than mass market and 3 to
4 times than Diesel and Fred Perry which are high end street fashion brands.
Exclusivity, but down-to-earth. You don’t buy bling-bling or diamonds but
style, design and high quality.
Paul Smith wants to differentiate from fast fashion with prices and quality and
the author suspects that Paul Smith would never do a collection for H&M or
use outside ”celebrity” designer.

21. ObservationsObservations
Some accessories are not in the line with the cloth prices. Good example is the
watches which vary from 220€ to 300, which are relatively cheap for luxury brand
(Paul Smith is not a very visionary watch designer either).
Prices are definetely exclusivity signaling and there are no discounts in stores Brand
uses warehouse sales to get rid of the extra stock. Internet has few websites which
sell Paul Smith products with hefty discounts, but the author suspect s – from the
very ugly and hazy design of the web pages that these don’t have nothing to do
with the real Paul Smith brand. Or products.
Accessories and t-shirts and Paul Smith Jeans collection are the entry products for
new and young customers. Prices increase according to different collections which
makes possible a lifetime relationship for the customer as there is always
something new to dream about. This is very usual for contemporary luxury brands
and justifies the masstige expression for Paul Smith.
Co-branded products have also ”Paul Smith” premium and keeps the pricing on line
with the main brand.

22. Paul's many faces
Movie, click to play
Wedgewood charity mug
Dream and Exclusivity Factors in Brand CommunicationDream and Exclusivity Factors in Brand Communication

23. AdvertisingAdvertising

24. Quirky, stylish, colorful, the stripes, the Paul Smith logo,
playful...
Coherence of the brand achieved!

26. Last but not least, himself and his various activitiesLast but not least, himself and his various activities
Sir Paul Smith is the ultimate manifestation of the
brand which carries his name. Apart form the art and
sports lover, he loves travelling and exploring. He
has major impact dream and exclusivity factor
through his public activities and comments in news
papers and his own blog. It is hard to see anybody
hating the persona of Mr Smith ( author found one
doubting comment from the Economist, where
someone criticized the prices of Paul Smith
products). He contradicts the usual perception of
star designer and fashion milloinaire and his brand
does the same for the classic perception of luxury
brand. Either he has a very clever image campaign
which is used to differentiate from the competitors
or he is truly an odd bird in the fashion industry. He
is simply invaluable for the the Paul Smith brand.

27. and his various commentsand his various comments
“I go to my office in Delhi, just
for the day. I also went to the
Great Wall of China and
Vietnam for the day. My
favourite was a day trip that
took in Moscow in the
morning, St Petersburg in the
afternoon and New York at
night. I'm busy - I have to visit
places briefly.'
'It would be wonderful if fashion shows died out completely.'
“So many brands are too conscious of what everybody else is doing. I
like to get my inspiration elsewhere: from exhibitions, books, or even a
stained-glass window."
"Frankly, I don't care what people wear. If a person is nice, with good
manners, I couldn't give a damn if he's wearing a shell suit."
"The business came about organically, but we've never borrowed
money and we've been careful not to overexpand our product ranges,"
"I do often think what a privileged human being I am," he says
suddenly. "I have a really enjoyable, interesting life, and I'm aware of
that every day."
“I take pictures every day,” he explains. “It’s a visual diary of
where I’ve been; something to show the grandchildren. I’ve always
got a camera and a notebook stuck in my pocket.”
“We made the hamster T-
shirt in three days. We get
letters like that constantly.”
Mr Smith after receiving
hamster t-shirt query from 7
year old who had a pet
hamster named Rubert.
On retailing in fashion industry. Click for video

28. Web pages and InternetWeb pages and Internet
•The main web page of the company is very plain compared to brand
esthetics and brand DNA. It is filled with information, but it is disappointing
especially if one visited Paul Smith shop before the web pages. Web pages
fail also to make visual contributions to dream and exclusivity factors. They
concentrate more on information which of course thells about the world of
the brand, but as the saying goes: picture is tells more than thousand....
•Mr Smith’s blog is interesting and reinforces his image and tells about his
world and what he finds exciting and novel. Of course there are his company
related posts also. He also uses Twitter and Facebook in very same way as
he does his blog. This feels like you are invited to his world and by the man
himself. Not many other luxury brands use their main designer this
efficiently to promote the brand and company.
•Official online shop is also somewhat disappointing because it has the dull
main page as a platform. Products of brand like this suffer from plain
surroundings.

29. Observations on communicationObservations on communication
•Even the quirky brand liike Paul Smith uses relatively traditional advertising semiotics such as
youth, nature, high society, good looks. Although, it is not5able that Paul Smith doesn’t play too
much with sex in the ads. Compare that to other luxury brand peers!
•Company succeeds perfectly in hiding their strategic and financial facts, thanks to not being public
company.
•Sir Paul Smith is the manifestation of the brand. He has very good public image and is charismatic
and likeable and his persona fits perfectly to Paul Smith brand. This is no surprise as he is the main
designer, but a cynic might think that the knoghthood, humbleness and down-to-earth and
controversial relation to fashion might be just a clever trick to differentiate from the competitors.
Whatever the reality, it works and media feed from his hand. His impressive cavalcade of friends
doesn’t do harm to brand and the dream it offers.
•Brand communication is very coherent and the feel and trademarks of Paul Smith brand are
always present.
•Design and concept of the web pages should be rethought. They are not used optimally to
reinforce brand image and dreaming & exclusivity (expect with prices in the online shop).
Alhtough they provide lot of information about the company and Sir Paul Smith

30. International Distribution ModelInternational Distribution Model

31. International Distribution ModelInternational Distribution Model
•Company has approximately 100 retail and 300 wholesale locations in 50
countries. These include:
-Flagship stores and normal concept stores + airport stores
-Department stores and smaller specialty stores such as footwear stores that
sell Paul Smith footwear or Colette which sell his accessories.
•Flagships are located in the luxury shop districts which enhances the dream
and exclusivity factor, although the Paul Smith shop usually doesn’t seem to
fit next to Gucci or Dior.
•Department stores where the brand is present are such caliber as Harvey
Nichols, Harrord’s Gallery LaFayette, GUM, Barney’s and Neiman Marcus.
•Specialty stores are usually small and concentrate offering particular
products forexample shoes, shirts, fragnances or watches etc...These also
located often in high streets.
•Paul Smith has licensing on Fine china, fragnances, Spectacles clothing line
and rugs. Licensees are top of the line producers. For example Watches are
Swiss made and Fine China by Thomas Goode.
•Notable detail is that principal Japanese licensee, Itochu, owns now 40% of
the Paul Smith company.

32. Physical Shop ConceptPhysical Shop Concept
•Concept in a nutshell is ”Expect the unexpected”. First timers which don’t know the
brand can be even confused what the shop is about
•The dimension of Sir Paul Smith who visions every shop and approving the shop
locations
•Every shop has different design, an odd idea in the luxury industry but fitting for the
brand.
•Atmosphere is inspiring, elegant and still cozy and there are usually many sections
with different themes. Products are placed traditionally but also sometimes one can’t
say if something is buyable
•From cloth collections to books and to curious little objects like mini-robots and tooth
brushes and candles
•Roses and paintings are trademark s are also the the stripes and colourfulness.
•Especially visual sense is employed, music is relaxing but not classic, different
materials add touch –f or example wall made of pences in the Paris shop.

33. MerchandiseMerchandise
In paper, the colourful and eclectic appereance of the shops can sound like
circumstances that products get drowned to furnishing and decoriation, but
they are natural part of the shops and theu are pieces of that Paul Smith
world. Packaging and paper bags are line with the experience and make a
memory

34. Shop Dream and Exclusivity factorsShop Dream and Exclusivity factors

35. Lot of shop art exhibitions and Lot of shop art exhibitions and
happenings. Why?happenings. Why?
Space Gallery at Tokyo –
Click for more information
Globe at Heathrow – Click
for more information

36. Services and after salesServices and after sales
• Service level is good . Stylish staff knows their products
but they don’t push them and they don’t mind how much
you spend time looking at the books or how do you look
like.
• Willing to help you find the product from other stores or
inform you about the web pages.
• 30 days return policy doesn’t promote luxury or high
quality, but they take back even used products - through
mail also - and return money to your credit card, not just
shop credit
• Judging from the web reviews from Paul Smith shops
arounds the world, the customer experiece is not coherent
though and some people felt that they have received
mediocre or even service and after service. Volatility in
service experiences is common problem in luxury industry
• Exclusivity and brand heritage promoted by Bespoke in-
house tailoring services which are available in major stores

37. Future of the brandFuture of the brand

Paul Smith is doing well at the moment and despite the recession it’s not in any trouble,
Thanks to debtless state of the company, strong brand and brand loyal customers. The Chinese market has beeen
difficult for the company. It might be that the Chinese consumer is not ready fot eclictic designs of the brand. The
classic such as Chanel, LV Hugo Boss and Burberry are more easier and safer options for consumer in a culture
that is highly community based and doesn’t yet feel secure enough to fanfare individuality what PS represents.
The role of the Japanese licensee, Itochu who owns 40% of the company, is interesting. Paul Smith went to Japan
already in 1984 so the company is well established there and the probable reason for the selling is that the Sir
Paul Smith’s side of the company wants to concentrate on other emerging markets. Kodanshaya knows the
company culture and the Japanese – maybe also Chinese because they are huge in Asia – markets after 25 years
and Smith seems to trust them 100%. There are still risks that they want to develop brand to other direction
because it is probable that licensee staff is changing all the time and the respect for the brand DNA and heritage
can detoriate if the trends in the markets are in conflict with the brand style and culture of the company.
Biggest question is what happens after Sir Paul Smith and his wife go from here to eternity or get too old to run
the show. Brand is manifestation of Smith’s persona and designs. The move to sell the 40% to the trusted
Japanese Itochu could have been sign of trying to ground the base for retaining character for the time after Smith.
Many brands carry their founders name and use the heritage of these greats to carry on the business, but this
may be trickier for Paul Smith because the designs are so personal. The finding of a new creative designer will
cause headache to executives. Keeping the exclusivity is easy, but the dream side is made of from the very dreams
of Sir Paul Smith.

38. Some lessons learned from Paul Smith’s 4PsSome lessons learned from Paul Smith’s 4Ps
1.You can be succesful by staying true to yourself. It may feel safer to go with the flow,
but the brand loses originality in blind trend worshipping.
2.Logos and trademarks in the design are important to sustain fom collection to
collection. Logos are not dead, they are very much alive, just make them smaller. You
can have one main designer over 30 years and use the face effectively in brand building.
3.By staying true to brand DNA in all time and collaborating with unexpected subcultures,
Paul Smith has gained also credibility from consumers that are not exactly in to the
luxury and it has been able gain attention of creative class and subcultures.
4.You can execute your marketing campaigns and catwalk showdowns without relying
heavily on sex, seduction and bare skin. Everybody can take their clothes off, it is not
exclusivity. You can also do withouth continuous advertisement and celebrities
attached to your brand. Credibility is what you get in exchange.
5.Shops can be done in very imaginative style. Location and prices and service makes it
exclusive, inside of the shop is what makes you dream. And there are wide variety of
dreams in people’s heads. You can look behind the bling-glam-shiny-pinstripe-gold-
diamond clichés and find new consumer groups for luxury products.