From Karl Lagerfeld to Erdem: a Series of Collaborations Between Designer Luxury Brands and Fast-Fashion Brands
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J Brand Manag https://doi.org/10.1057/s41262-018-00146-2 ORIGINAL ARTICLE From Karl Lagerfeld to Erdem: a series of collaborations between designer luxury brands and fast-fashion brands 1 1 1 Mona Mrad • Maya F. Farah • Stephanie Haddad Revised: 2 June 2018 Ó Springer Nature Limited 2018 Abstract Numerous designer luxury brands have been Introduction interested in creating co-branding partnerships with the fast-fashion retailer H&M. Despite the recognition by some Fierce competition and dynamic marketing environments researchers of the value of examining whether consumer steadily pressure companies to adopt innovative branding reactions to the co-partnering luxury brands will be affec- strategies to capitalize on their brand equity (Ko et al. ted by the collaboration, to the best of our knowledge, no 2016; Nobre and Ferreira 2017). As a response to current research to date has examined luxury consumer reactions to market instabilities, companies are increasingly interested such partnerships. Accordingly, this research specifically in establishing co-branding partnerships (Shen et al. 2017; explores how the collaboration between a luxury brand and Voss and Mohan 2016). The purpose of such partnerships a fast-fashion brand impacts on consumer reactions to the is to benefit from the likely positive spillover associations luxury brand. Considering the exploratory nature of this between the allying brands, which could enhance brand study, thirty face-to-face in-depth interviews were con- image and awareness (Oeppen and Jamal 2014; Xiao et al. ducted in the UK to reveal insights into consumer reac- 2014). tions, given the limited knowledge on the subject matter. Co-branding is considered as a form of brand alliance, Six themes emerged from this study: (a) enhanced brand whereby two or more brands collaborate and form a part- awareness, (b) impaired perception, (c) word-of-mouth, nership (Besharat 2010; Kupfer et al. 2018; Voss and (d) consumer engagement, (e) perceived self-expressive- Gammoh 2004). Since the beginning of the century, note- ness and (f) brand avoidance. worthy collaborations between designer luxury and other fast-fashion brands have been attracting considerable Keywords Co-branding Á Fashion Á Luxury brands Á Fast- media attention (Lee and Decker 2016). The Italian luxury fashion brands brand Missoni, for instance, joined forces with the mass market brand Target with respect to 400 pieces including non-fashion-related product categories. This alliance resulted in a remarkable 3.7% increase in Target’s net profits during the first quarter of 2011 (Bickers 2011). Numerous similar collaborations were established in the fashion industry, the most popular of which are those & Mona Mrad between the Swedish fast-fashion retailer Hennes & Mau- [email protected] ritz AB (H&M) and a number of designer luxury brands Maya F. Farah (Shen et al. 2017). H&M established its first collaboration [email protected] with Karl Lagerfeld in 2004 and thereafter a series of Stephanie Haddad yearly alliances with other designer luxury brands. In 2015, [email protected] as a result of its collaboration with the French luxury brand 1 Adnan Kassar School of Business, Lebanese American Balmain, H&M reported a 10% rise in sales during University, Beirut, Lebanon December, compared with the previous year (Lidbury M. Mrad et al. 2016). The common endeavour between H&M and Bal- of the need to explore potential negative spillover effects main was a stunning success, for which customers queued and consumer reactions to the partnering luxury brand (e.g. for 3 days prior to the launch of the collection (Brooks Besharat and Langan 2014; Shen et al. 2017). Previous 2015). International top models, such as Kendall Jenner research on brand alliances has mainly explored long- and Gigi Hadid, were modelling and promoting the col- rather than short-term alliances (Nabec et al. 2016), lection for some 58 million Instagram followers (Lidbury revealing a gap in exploring the consequences of limited- 2016). In November 2017, for its 19th consecutive season, edition designer collections resulting from such collabo- H&M formed a designer’s collaboration with the British rations. To the best of the researchers’ knowledge, apart luxury brand Erdem for its first menswear line, raising from the work of Amatulli et al. (2016), which explores the consumer excitement and anticipation (Carvell 2017), views of luxury brand representatives, no research has yet resulting in a 12-h overnight queue. All the established focused on luxury purchasers’ reactions to this form of collaborations between H&M and luxury brands from 2004 collaboration within the fashion industry. In fact, McEnally to date are shown in Table 1. and de Chernatony (1999) claim that companies must This form of collaboration between H&M and designer decide on the form of collaboration, based on the consumer luxury brands is referred to as joint venture co-branding, viewpoint, emphasizing that they should only be involved whereby the two brands create a joint collection (Shen in such partnerships when this enables them ‘‘to create et al. 2017). Previous research indicates that co-branding value for the consumer where and when, and under what may affect consumer attitudes towards the individual conditions, the consumer desires that value’’ (p. 18). brands either positively or negatively (e.g. Balachander and Moreover, Walchli (2007) proposes that brands entering Ghose 2003; Geylani et al. 2008; Votola and Unnava into a partnership should not consider only the outcomes of 2006). The literature in the field suggests that designer the synergetic relationship between the two entities, but collaborations help brands to attract media attention by also their respective consumers’ responses. Based on the creating buzz for both the retailer and the brand alike (Shen above gaps in the literature, this research explores how the et al. 2017). Collaborations are also considered an impor- perceived collaboration between a luxury and a fast-fash- tant way to increase both revenue and consumer awareness ion brand impacts consumer reactions to the luxury brand. (Rollet et al. 2013). Interestingly, attracting media attention rather than profits seems to be the key measure of success (Friedman 2010). Forming such co-brand partnerships may Literature review additionally help in responding to emerging market trends and enhance brand loyalty (Voss and Mohan 2016; Shen The literature on co-branding remains inconclusive with et al. 2017). regard to defining this type of marketing strategy (Besharat Nevertheless, although brand collaborations promise 2010; Leuthesser et al. 2003; Wright et al. 2007). Different positive outcomes for mass market fashion labels (Shen terms are used to refer to co-branding, including brand et al. 2017; Simonin and Ruth 1998), their impact on alliance (Park et al. 1996; Washburn et al. 2004; Kupfer partnering luxury brands is controversial. According to et al. 2018), ingredient branding (Leuthesser et al. 2003), Geylani et al. (2008), co-branding may impair brand image. and joint branding (Levin and Levin 2000; Rao et al. 1999; This statement is confirmed from research on luxury brand Rao and Ruekert 1994). Nevertheless, for any type of co- extensions, which proposes that downward brand stretching branding agreement to exist, the following conditions attracts consumer attention, yet may devalue and dilute the should be met: (1) the collaboration should be based on an image of the luxury brand (Cheng-Hsui Chen and Chen estimated partnership duration, (2) the main aim should be 2000). The collaboration experience that led the legendary to enter a new or an existing market by jointly developing a creative director Karl Lagerfeld to state that he ‘‘would new product and (3) the names of both brands should never work with H&M again’’ (Vogue 2004) highlights the appear on the product (Besharat 2010). importance of exploring whether such collaboration would Co-branding may take any of the following forms: joint have the same negative impact on a luxury brand as with venture, same company or ingredient co-branding (Shen brand extensions. Indeed, recent studies question whether et al. 2017). Joint venture co-branding is a form of col- this form of joint partnership is a wise co-branding strat- laboration whereby two or more manufacturers collaborate egy. Along these lines, Shen et al. (2017) explore the and release their products under both brand names effects of brand loyalty on revenue obtained from luxury (Blackett and Board 1999). This form of partnership is and fast-fashion collaborations. applied by H&M and Stella McCartney, Balmain, Erdem, A thorough examination of the literature indicates that etc. In the latter case, the fast-fashion brand H&M is the study of joint partnerships between luxury and mass considered to be the parent brand, while the co-partnering fashion brands is still nascent, despite the wide recognition designer luxury brand is considered to be the participant From Karl Lagerfeld to Erdem: a series of collaborations between designer luxury brands and… Table 1 List of collaborations between H&M and designer luxury brands Year Designer luxury Collaboration outcome References brand 2004 Karl Lagerfeld 1500–2000 pieces sold/hour Yotka (2017) Monthly revenue increased by 24% 2005 Stella McCartney Collection sold out within hours Fashionunited (2018) Revenues increased by 11% 2006 Viktor & Rolf More than 200 people lining up prior to their opening Weinstein (2007) 2007 Roberto Cavalli Shoppers