TABLE OF CONTENTS

BRAND INVENTORY..........................................................................................................................2

COMPANY HISTORY AND BACKGROUND................................................................................2

OWNERSHIP......................................................................................................................................3

OBJECTIVE OF BRAND AUDIT......................................................................................................3

PRODUCT RELATED ATTRIBUTES..............................................................................................3

BRAND PORTFOLIO........................................................................................................................4

COMMUNICATION, PRICING AND DISTRIBUTION..................................................................6

BRAND EXPLORATORY...................................................................................................................8

CUSTOMER KNOWLEDGE.............................................................................................................8

SOURCES OF BRAND EQUITY......................................................................................................8

CUSTOMER BASED BRAND EQUITY PYRAMID.......................................................................9

SALIENCE DIMENSIONS............................................................................................................9

PERFORMANCE DIMENSIONS..................................................................................................9

JUDGEMENTS DIMENSIONS....................................................................................................10

IMAGERY DIMENSIONS...........................................................................................................10

FEELINGS DIMENSIONS...........................................................................................................10

RESONANCE DIMENSIONS......................................................................................................10

THREATS TO BRAND EQUITY....................................................................................................10

RECOMMENDATIONS.....................................................................................................................11

REFERENCES.....................................................................................................................................12

Page | 1

BRAND INVENTORY

COMPANY HISTORY AND BACKGROUND

Following his graduation from the High School of Art and Design, Calvin Klein studied

apparel design at Manhattan’s Fashion Institute of Technology. Inspired by the fresh and

unpretentious style of New York’s urban youth, Klein was ready to launch his own clothing

company in 1968. With financial help from a childhood friend Klein hired a seamstress to

make a handful of his elegant woman’s coats and dresses.

This merchandise was seen in a dingy showroom by a merchandise manager from Bonwit

Teller. The department store purchased $50,000 worth of apparel and displayed samples in

eight windows, kicking of Klein’s career. By 1970, Calvin Klein obtained a trademark for his

infamous “CK” logo. Soon thereafter, Klein received the Coty Award, a prestigious design

award, three consecutive years in a row in 1973, 1974, and 1975. In addition, he added

numerous product lines and categories and acquired models such as Brooke Shields and Mark

Wahlberg. These models’ careers took off after their Calvin Klein debut because the brand

has received much recognition over the years for its sleek, classic, and minimal look. By

2003 Phillips-Van Heusen purchased the company where Calvin Klein remained active

within the company as a head designer. The company continues to offer a variety of products

to a wide target market.

The Calvin Klein brand, owned by Phillips-Van Heusen Corporation, covers a wide variety

of product classifications. Designer Calvin Klein made his debut at a small New York

showroom with coats and dresses for women in 1968. Klein’s first designs represented a city

chic style of a young woman living and working in New York. These designs were noticed in

the apparel industry, and a successful brand name was founded in that small showroom. The

next product line from Calvin Klein was women’s sportswear, which attracted the interests of

popular fashion magazines Bazaar and Vogue. Klein has included sportswear for women in

his seasonal lines since the original line was launched.

The trademark product of the Calvin Klein brand came out in 1970 and has been the most

popular product in Klein’s many retail locations. Klein’s denim jeans are the single product

that launched his status as a high-end designer in the apparel industry. Within the next ten

years, Calvin Klein had expanded into the menswear and underwear markets, designing

Page | 2

boxers and briefs as well as women’s intimates. His menswear line began with boxers and

briefs, and eventually developed into high-end suits, button down dress shirts, accessories,

and footwear. By the early 90’s, he had already designed a swimwear line, launched two

fragrances for men and women, and expanded into the accessories, eyewear, and footwear

markets.

The next step for Klein was to manufacture an affordable brand under the name CK

including denim, logo T-shirts, fragrances, and sportswear for men and women at a more

affordable price. Calvin Klein later followed Ralph Lauren’s example by creating a home

furnishings line. His most recent item is a makeup line sold exclusively in department stores.

It is evident that Calvin Klein saw that product line extension was necessary for company

success as well as a means to surpass his competition.

OWNERSHIP

PVH Corp., one of the world’s largest apparel companies, owns and markets the iconic

Calvin Klein and Tommy Hilfiger brands worldwide. It is the world’s largest shirt and

neckwear company and markets a variety of goods under its own brands, Van Heusen, Calvin

Klein, Tommy Hilfiger, IZOD, ARROW, Warner’s and Olga, and its licensed brands,

including Speedo, Geoffrey Beene, Kenneth Cole New York, Kenneth Cole Reaction,

MICHAEL Michael Kors, Sean John, Chaps, Donald J. Trump Signature Collection, Joseph

Abboud, DKNY, Ike Behar and John Varvatos.

OBJECTIVE OF BRAND AUDIT

The purpose of this brand audit is to evaluate the health of the company, including its brand

equity in the past, present and future. Calvin Klein Inc. has developed from an individual

designer to a success story purchased by industry leader, Phillips-Van Heusen. This report is

responsible for evaluating the Calvin Klein brands and comparing how the company is doing

relative to other brands in its industry and to offer recommendations for improvement or

possibilities at brand extension.

PRODUCT RELATED ATTRIBUTES

Calvin Klein has many different types of products to offer and all this products have different

type of attributes, the only thing which is common between them is that they make you feel

rich. Following is the list of products and there attributes:

Page | 3

1) Calvin Klein Platinum-Modern, Clean, Sexy.

2) Calvin Klein Jeans-The original designer jeans, provocative, youthful.

3) Calvin Klein Underwear-Modern, body conscious, sensuous.

4) Calvin Klein Watches and Jewellery-Minimal, modern, precise.

5) Calvin Klein Fragrances-Intriguing, mysterious, evocative.

BRAND PORTFOLIO

Calvin Klein is owned by Phillip Van Heusen which is one of the most prominent name in

fashion industry and there are several other brands like Tommy Hilfiger that are owned by

Van Heusen .There are different brands which are the part of Calvin Klein they are as

follows:

Calvin Klein Collection – The “halo” brand, under which men’s and women’s high-

end designer apparel and accessories, as well as items for the home, are sold.

Representing pure, refined luxury, distribution is through the wholesale channel

across the globe and through flagship stores in Asia and their own Calvin Klein

Collection retail flagship store on Madison Avenue in New York City.

Calvin Klein (platinum label) – The "bridge" brand, formerly known as ck Calvin

Klein, was rebranded in 2013 in order to unify the Calvin Klein brands under one

umbrella. This line offers modern, sophisticated, fashionable items including apparel

and accessories, which are sold in the wholesale channel through specialty and

department stores in various regions, as well as in free-standing stores in Asia.

Page | 4

Calvin Klein (white label) – The white label “better” brand includes offerings such

as men’s sportswear and dress furnishings, men’s and women’s outerwear, fragrance,

accessories, footwear, performance apparel, women’s sportswear, dresses, suits and

handbags and items for the home. Distribution is primarily in North America through

department stores and free-standing stores.

Calvin Klein Jeans – Offerings under this label include men’s and women’s jeans

and related apparel, which are distributed worldwide, and denim accessories, which

are distributed in Europe and Asia. With roots in denim, it is the casual expression of

the Calvin Klein brand and is famous for its unique details and innovative treatments.

Page | 5

Calvin Klein Underwear – As the world’s leading designer underwear brand for men

and women, Calvin Klein Underwear is known across the globe for sexy, cutting-edge

products and marketing campaigns, consistently delivering innovative designs with

superior fit and quality. Offerings under this label include men’s and women’s

underwear, sleepwear and loungewear, which are distributed worldwide.

COMMUNICATION, PRICING AND DISTRIBUTION

Calvin Klein communicates with its consumers by launching different types of commercials

and advertisements. They also endorse celebrities and models like Miranda Kerr to make it

more attractive. Apart from that Calvin Klein now devotes nearly a quarter of its marketing

budget to digital, with social media Influencers playing an increasingly important role. Calvin

Klein on 17th February 2014 came up with “Show yours. #mycalvins” campaign for its

Calvin Klein Underwear division, which is first kind of social media advertisement by any

garment company.

Calvin Klein INC has different type of pricing strategies for its wide range of products. The

strategies are as follows

Penetration Pricing-Penetration pricing is a marketing strategy used by Calvin Klein in

order to attract customers to a new product or service. Penetration pricing is based on the

practice of offering a low price for a new product or service during its initial offering in

order to attract customers away from competitors. The reasoning behind this strategy is

that customers will buy and become aware of the new product due to its lower price in the

marketplace relative to the rivals.

Page | 6

Penetration pricing can be a really successful marketing strategy when applied correctly.

It can often increase both market share and the sales volume. Additionally, the high sales

volume can also lead to lower production costs and higher inventory turnover, both of

which are positive effect for any firm with fixed overhead. The chief disadvantage,

however, is that the increase in sales volume may not necessarily lead to a profit if prices

are kept too low. As well, if the price is only an introductory campaign, customers may

leave the brand once prices begin to rise to levels more in line with rivals

Competition pricing-This type of pricing means setting the price of a product or service

based on what the competition is charging. “Competitive pricing is used more often by

businesses selling similar products, since services can vary from business to business

while the attributes of a product remain similar. This type of pricing strategy is generally

used once a price for a product or service has reached a level of equilibrium, which often

occurs when a product has been on the market for a long time and there are many

substitutes for the product. For example: There are many substitutes of Calvin Klein in

market like Zara, Tommy, gap, Louis Phillip etc so Calvin Klein decides the price of its

products according to competitors pricing of the same product.

Product Line Pricing-This is a pricing strategy which is used to sell different products in

the same product range at different price points based on features or benefits. This type of

pricing is used when a primary product is offered with different features or benefits,

essentially creating multiple "different" products or services. For example: Calvin Klein

has different product lime like Calvin Klein platinum label and Calvin Klein white label

both are into same product but are priced differently due to attributes and features of the

product. Platinum label is the premium product so its cost is high.

Calvin Klein’s products are distributed through wholesale partners and through over 2,700

retail locations (including company operated, licensee and franchisee stores) across the

world. Within the Calvin Klein brand portfolio, Calvin Klein Collection acts as a halo brand

and offers inspiration to the other brands, which include Calvin Klein (platinum label), which

is “bridge” line, Calvin Klein (white label), which is “better” line, Calvin Klein

Underwear and Calvin Klein Jeans.

Calvin Klein products are available through wholesale customers (third party retailers,

distributors and pure play e-tailors which sell products in brick and mortar stores and mobile

and online e-commerce sites), at own company-operated retail locations across the world, and

Page | 7

online through mobile and e-commerce websites in the United States, Europe, Brazil and

China. In 2015(last quarter), it is expect to launch directly operated e-commerce sites in

Canada, Hong Kong and Macau, Calvin Klein plans to operate e-commerce sites in 20

markets by the end of 2016. Additionally, in certain markets, products are distributed through

licensees (including joint ventures), franchisees and distributors.

BRAND EXPLORATORY

CUSTOMER KNOWLEDGE

Consumers have the conceived notion that Calvin Klein produces quality lasting products in

all departments; they are willing to invest their money in the name repetitively. The ongoing

trust and loyalty of the consumers allow the brand to stay alive. Not only are consumers

trusting of the Calvin Klein name, they feel confident in the products. In particular, the

Calvin Klein clothing makes a man or woman feel sexy yet sophisticated, daring and bold,

and often times rich. These are all good feelings that many people desire to feel. Apart from

that consumers think that Calvin Klein is a brand that adds value to their personality as it is

considered to be one of the premium brands in garments and fashion industry.

SOURCES OF BRAND EQUITY

Calvin Klein’s brand was named “Calvin Klein” after himself. “CK” is the famous symbol of

the brand. Although Calvin Klein does not have a character associated with the brand, models

such as Mark Wahlberg, Brooke Shields, Kate Moss, and Eva Mendes are often associated

with Calvin Klein advertisements. There are several slogans affiliated with the brand

including “Between love and madness lies obsession,” and for Calvin Klein Jeans, “Nothing

comes between me and my Calvin’s”

Calvin Klein turned all its brand elements into sources of brand equity to evoke brand

awareness, interest, and loyalty because they are well known names, symbols, and categories

on a global level.

Page | 8

CUSTOMER BASED BRAND EQUITY PYRAMID

SALIENCE DIMENSIONS

1. Recall

a. Good presence on social networking sites.

b. By seeing the logo of Calvin Klein.

2. Recognition

a. Whenever consumer will think of buying designer clothes or accessories Calvin

Klein will be considered.

PERFORMANCE DIMENSIONS

1. Primary Characteristics and Supplementary Features

a. Classic designs

b. Excellent quality

c. Customized products

d. Variety in products

e. Tough products

Page | 9

RESONANCE-Sence of community(represented by online presence) loyal

customers with high repeated purchase.FEELINGS-Sophisticated,

royal, designer clothing, elite.

JUDGEMENTS-Well known American brand with quality

product, Product line designed for younger demographic.

IMAGERY-Modern, Clean, Sexy,designer, Rich heritage, CK logo.

PERFORMANCE-Classic design, Excellent quality, Sophisticated & tough products, High price.

SALIENCE- Apparels and Accesories, Strong visual identity.

JUDGEMENTS DIMENSIONS

1. Brand Quality

a. High end products

b. Satisfaction for high price paid.

2. Brand Credibility

a. Brand for youngsters with quality and style

b. Costly brand

3. Brand Consideration

a. Consumer will always take into consideration brand Calvin Klein whenever

they are willing to buy designer products or high end products.

IMAGERY DIMENSIONS

1. By looking at the brand, product and its advertising campaigns consumer will be think

having the product; it will make them feel different.

2. The rich heritage and brand logo will lead the consumers to purchase the products of

the brand.

3. The luxury connected to Calvin Klein will lead the customers to pay such higher

prices.

FEELINGS DIMENSIONS

1. The sophisticated as well as tough image related to different types of product of the

brand Calvin Klein will lead the customers to feel good about the brand.

2. Though Calvin Klein is also a huge brand it is also a sub brand of Phillip Van Heusen

which is also a well known brand in the market.

RESONANCE DIMENSIONS

1. Once a CK consumer will always be a CK consumer, as he becomes the fan of the

designs and materials of CK products.

2. The consumers will have a sense of community due to online presence of the brand

e.g.: #mycalvins initiative.

THREATS TO BRAND EQUITY

Though Calvin Klein is owned by Phillip Van Heusen one of the main threat to Calvin Klein

brand is Van Heusen itself as it is also the major competitor of Calvin Klein in apparel

Page | 10

industry apart from that Tommy Hilfiger which is another brand of Van Heusen which plays

as a competitor of Calvin Klein in watch and accessories segment. Both this brands are

famous and thus can be a threat to brand equity of Calvin Klein.

RECOMMENDATIONS

Calvin Klein has been successful for over 40 years, including when Phillips-Van Heusen

purchased the company in 2003. While Calvin Klein follows current trends, the company is

still developing its status as a lifestyle brand. Calvin Klein Children’s is currently the weakest

of the company’s many brand extensions. To strengthen the company as a whole, the

promotional strategies of the children’s wear line need to be strengthened also.

Since Calvin Klein brands started with a line of women’s coats and dresses, Klein continued

to expand on the original brand for the next 40 years. This included menswear, sportswear,

denim, and CK Calvin Klein all before 1990. The popular fitted and trademarked jeans that

branded his name birthed the Denim Line. Within the next 10 years Calvin Klein brands

expanded to home furnishings, accessories, intimates, and the most unrecognized children’s

wear. Recommendations for further brand extension would be in the children’s wear segment.

The brand name that is still lacking in profit is Calvin Klein Children’s. Introducing new

designs and new advertising campaigns that appeal more to working or stay at home parents

would be a successful strategy to improve the brand’s equity. Calvin Klein Children’s

products include those similar to Calvin Klein Women’s and Men’s, to attract those parents

who want to dress their children with a similar style to their own. This includes designer

denim, polo t-shirts, and accessories. To attract a wider range of parent consumers, the brand

must expand their products to include clothing that children living in a household with a

lower income would wear. The brand CK in Calvin Klein women’s is a more affordable,

casual brand made to attract a younger but still fashionable consumer. This brand should be

extended to include Children’s wear, making it more affordable for the parents and more

appropriate for children.

Page | 11

REFERENCES

2015. . [ONLINE] Available

at: http://pages.stolaf.edu/calen-digitalrhetoricfinal/files/2014/12/102014_underwear_sub1.jp

g. [Accessed 02 October 2015].

Our Brands - Calvin Klein . 2015. Our Brands - Calvin Klein . [ONLINE] Available

at: https://www.pvh.com/brands_calvin_klein.aspx. [Accessed 02 October 2015].

Our Company - Business Groups . 2015. Our Company - Business Groups. [ONLINE]

Available at:https://www.pvh.com/company_business_groups.aspx. [Accessed 02 October

2015].

Organizing the pricing strategy of a company. 2015. Organizing the pricing strategy of a

company. [ONLINE] Available at:http://www.slideshare.net/SecoDK/pricing-strategy-

31273588. [Accessed 02 October 2015].

Digital strategy: Calvin Klein · FELLT Industry. 2015. Digital strategy: Calvin Klein ·

FELLT Industry. [ONLINE] Available at:http://fellt.com/industry/2014/06/digital-strategy-

calvin-klein. [Accessed 02 October 2015].

2015. .[ONLINE]Availableat:http://abbranno.weebly.com/uploads/6/2/5/2/6252494/

calvin_klein_brand_audit.pdf. [Accessed 02 October 2015]

cbbe model - Google Search. 2015. cbbe model - Google Search. [ONLINE] Available

at: https://www.google.co.in/search?

q=cbbe+model&espv=2&biw=1517&bih=741&source=lnms&tbm=isch&sa=X&ved=0CAY

Q_AUoAWoVChMIq-eChI2kyAIVBG2OCh2acA5d&dpr=0.9#imgrc=BqFEVlfmv9qryM

%3A. [Accessed 02 October 2015].

Association for Consumer Research . 2015. Association for Consumer Research . [ONLINE]

Available at: http://www.acrwebsite.org/web/acr-content/652/brand-credibility-brand-

consideration-and-choice.aspx. [Accessed 02 October 2015].

Page | 12