1. Introduction – General information
The following essay will deal with the well-established Cologne-based luggage and suitcase manufacturer RIMOWA who has achieved world fame with its rectangular aluminium travel trunk featuring an iconic design – that is a grooved surface. The tradition-rich company can proud itself of over 100 years of experience having resisted drastic market fluctuations and recessions, extreme politico-economic crisis, reforms and other externalities such us societal change, globalisation and change at an unprecedented pace since the inception of the Internet in the 1990s.Hence the continued existence of the family business attests to the effectiveness of their strategies and a certain market resilience. The business has realized a meteoric career from a local business to global player which is now dispersed in more than 50 countries all over the
globe.
Their resounding success can be attributed to an incident in 1937 when the entire production site was destroyed due to Force majeure. Such an event often means that a company is doomed to decay as it incurs exorbitant reconstruction costs. In this case a „creative destruction“1 of the current business was imposed by an exogenous shock,that is the explosion of a bomb at their company site. But then the son of RIMOWA’s founder Richard Morszeck made a business(virtue) out of necessity back then.
He is also the eponym of the brand“
Richard
Morszeck Warenzeichen“. Actually Mr. Morszeck discovered that aluminium was the only material that had not been subject to destruction, so he decided to continue luggage production at the base of aluminium instead of leather. This was an unprecedented novelty which corresponded to yet unfulfilled demands with regard to practicability, comfort and stability. Hence the new kind of suitcase can be considered a “blue ocean”2 invention although this phenomenon has not been defined before 2005 (W. Chan Kim and Renée Mauborgne). But it perfectly fits the definition. However for this reason RIMOWA has achieved to rank among the world leaders in the business.
The purpose of this essay is to analyse and fathom RIMOWAS marketing strategies, to evaluate them and to provide further suggestions.
term coined by J. Schumpeter ( an Austrian economist) in his magnum opus entitled “Capitalism, Socialism and Democracy” (1942) to denote a “process of industrial mutation, which implicates an incessant substitution process of industries and products.
2
the metaphoric concept of a blue ocean describes an newly opened market a corner untainted by competition as opposed to a “red ocean” where rivals fight for market share. In a blue ocean demand is created by a unique invention which has no competitors and which is not easy to replicate.
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2. Mission statement
Their mission statement can be summarized either as „Expert craftsmanship, high quality materials, precision manufacturing and unwavering vision“ (Ian, 2010) or as it says in their current official online catalogue „’Craftsmanship meets high- tech.That is they attach importance to continued loyalty to their roots which lies in manual precision work and which is timeless and irreplaceable. Owing to the fact that they dispose of many years of experience the production process has become very sophisticated but also has been perfected. On the other hand they are eager to proceed with their pioneer status. So they maintain continued strive for excellence always revising and enhancing existing products while developing new ones with again unprecedented features. So the second blue ocean tapped into was the launch in 2000 of a serious lightweight suitcase made of polycarbonate.
The latter invention was made by the current CEO Dieter Morszeck. Then in 2001 a patented ball bearing-mounted Multiwheel® system was successfully brought to market. This system allows to easily transport heavy-load luggage. According to the differences of time-to-market periods it can be deducted that the company has also achieved to adjust to the acceleration in product cycles to keep abreast of the market. (Long period from innovation in 1937 until 2000, and a very short period from 2000 to 2001).The paradigm shift since the advent of the Internet is remarkable. It becomes obvious that their twopronged business policy (traditional craftsmanship and innovation) pays off. On top of that the famous notion of “made in Germany” plays a primordial role in their business tactics on the operational level.
3. Strategic posture
RIMOWA has a self-conception of a precursor in order that they can benefit from the first-mover advantage. That is they aspire to be considered a substantial part of the growth locomotive Germany. Apart from that they want to convey an image of their company as think tank and talent incubator. One of their superordinate goals is to always offer something very particular like the grooved pattern of the suitcases. It should be instantly recognized as their achievement that is not comparable to other products due to its unique and salient characteristics. The before mentioned strategic mission places emphasis on the pioneer image they are anxious to conserve. It can be considered as a way to circumvent in away competition trying to keep up the blue ocean market space. Furthermore RIMOWA aspires to reconcile the image of a global player and of a locally anchored business. So they are active in a myriad of countries all over the world. Again this action can be qualified as a method to pre-empt competitors that could introduce products 3
reminiscent of the RIMOWA suitcases. So they can strengthen their leadership position everywhere on the globe. Moreover it can be regarded as some kind of hedging strategy or contingency plan. If sales difficulties occur in one place, they may be compensated with a surge in demand in other countries. In order to further safeguard against future potential competitors RIMOWA sets high barriers to entry by means of their patents for the distinguishing grooves and the mounted Multiwheel® system. At the same time RIMOWA accentuates their down-to-earth attitude and despite their global engagement their business they kept a moderate size with about 1000 employees. But then their double-digit sales figures and return rates of € 145 million in 2011 testify to their success. (Lauermann, 2013). Thus their efficiency rate and profit margin must is even more considerable.
Following the purpose to even boost their ratio, RIMOWA meanwhile outsources labour intensive parts of the value chain to a Czech plant and a Canada to expand their capacities. RIMOWA decided on Canada, more precisely on Ontario in order to maintain a consistency in their quality-oriented image – “Ontario is also a premium brand, with pride in manufacturing excellence and a well-educated and skilled workforce, a strong innovative culture, reduced business and employer health(…)” (Ontario business report , 2012). Moreover due to the Canadian’s market proximity to the USA, RIMOWA has chosen a strategically propitious location which enables them to conquer also the US market more easily. For the same purpose they selected Cambridge (Canada) as an ideal location for “just-in- time” shipments located near major transportation routes.
A further aspect of their strategy is the high level of in-house manufacturing, only the zip fasteners are from Japan (Seidel, 2010) . Because of their long experience with their approved technique RIMOWA also benefits from a learning curve. The solidity of their liquidity and solvency situation as well as their excellent reputation qualifies them to go public in order to raise additional funds. But as a matter of fact RIMOWA made a deliberate choice of the legal form “GmbH” (corresponding to Ltd.) to convey the image of the famous German “Mittelstand”. What is more RIMOWA only focuses on its core business not to delude its image. It’s one of their major concerns to keep up the family business for consecutive generations. According to the current CEO it’s paramount to their philosophy to pursue a family-run business handing down the inhouse developed manufacturing techniques, the legacy of family success they are proud of.
It is out of question to go public, or to entrust responsibility to foreign organs, that is executives that are not family members involved. Actually the CEO fears thereby losing control and points out that external managers may only be profit-oriented. So RIMOWA banks upon organic growth, in percentage terms 99 % (Morszeck, 2009). But then if there is need for complementary skills RIMOWA hires outside personnel after meticulous selection procedures. Recently they have employed Hans Kürten who is responsible for special constructions. What is more it is also part of RIMOWAS’ risk strategy that they would not shift their production overseas to countries where 4 patent protection is lax. Actually RIMOWA is eager to take risk, if they dispose of the control. Hence substantial investments in Research and Development are part of their organic growth and (technological) innovation strategy. The afore-mentioned method can also be qualified as a “technology push” strategy.
4. short-term objectives
RIMOWA is about to conquer the North and American continent. Therefore they have launched a high-profile advertising scheme. A “flight tour” not a “road tour”. As a far-sighted business they have recognized huge potential in the emerging markets, especially in the Asian and South American continent as the propensity to consume and demand is very high there, more over the market is far from being saturated.
4.1
long-term objectives
They envisage to maintain unfailing performance as well as to come near “zero defects” in production keeping the complaint level as low as possible. Furthermore RIMOWA is anxious to become a generic trademark, respectively a proprietary eponym. Thus they envision that their trademark becomes an epitome of quality, style and comfort for discerning customers. Moreover they adopt a demeanour of continuous improvement in order to be able to set benchmarks for the business.
4.2
Brand
The RIMOWA brand belongs to the category of premium brand which justifies a high price. It can be also considered a flagship brand, a brand for which as business is best known. 4.2.1 essence
“ RIMOWA-Die Koffer mit den Rillen” , “Germany since 1898” and “Every case tells a story” are the slogans which express the core concept of the company.
4.2.2
image
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Extraordinary quality and unique design are the components that should be associated with he products. RIMOWA – the classic among the suitcases with timeless and simplistic elegance. 4.2.3
personality
the brand’s identity is forged by the attributes mundane, cosmopolitan, chic conveying the user an image of a quality and style-conscious connoisseur of world-class products that belongs to upper social strata. The brand also alludes to the notion of prestige.
4.2.4
equity
In the case of RIMOWA it is in particular the grooved design which identifies instantly their products together with the attributes such as impeccable quality. The brand’s name only is not as well known as the design. As long as there are no replicas launched onto market, there is no need to emphasize the name of the brand. But in the face of global competition and diverging legal framework, it becomes necessary to enhance name recognition. 4.2.5
logo
the simplicity and straight-forwardness of RIMOWA is expressed by a non-serif typeface without flourish.
5. Environmental analysis
In order to determine a sustainable marketing strategy it is absolutely necessary to conduct a marketing audit. The latter terms is defined as “a comprehensive, systematic independent, and periodic examination of a company’s marketing environment, objectives, strategies, and activities.” (Czinkota & Kotabe, 2008). It comprises market data and miscellany from research, merchandising data from sales departments, product data from production, financial data from accounting departments etc. When considering the interconnectedness of the global market sphere subject to perpetual metamorphosis due to information technologies a revising of the marketing definition of American marketing Association becomes a vital necessity. Their concept has been adapted by Czinkota & Kotabe the following way” marketing is an organizational 6
function and a set of processes for creating, communicating, and delivering and maintaining value streams to customers, and for managing customer relationships in ways that benefit the organization and its stakeholders, and society in the context of a global environment.” (Czinkota & Kotabe, 2008, S. 4-5). In the following the macro- and micro factors shall be analyzed.
5.1
Macroeconomic conditions
Over the past century the travel sector has undergone considerable transformations. Sociopolitical, scientific as well as technical developments, and economic necessities lead to a promotion of worldwide mobility. This trend has been accelerated since the inception of the internet from the 90’s onwards. However the industry plummeted in 2001 due
to the World Trade Centre terrorist attack. Afterwards it witnessed a period of revival and again was subject to decline in 2008/9 when the financial crisis hit adversely affecting this business sector. People were forced to cut down on expenditures for travel and tourism. However since 2010 the growth prospects are optimistic again given also the fact that demand is increasing at high rates in the emerging markets. In a nutshell it can be deducted that the travel market is especially vulnerable to externalities. As a matter of fact the luggage market is positively correlated with the travel industry and bound to equally volatile market conditions. Currently the luggage market is projected to grow about 4,5 % until 2014. However concerns regarding environmental impact due to excessive travelling have gained momentum as well. Above that a revival of “frugality” and green living has gained popularity which encourages the abandonment of overconsumption and incites people to get rid of unnecessary items while opposing travel because of environmental damage (Novacotiamiss, 2011), On the other hand there are groups of buyers that consider luggage articles as a fashion accessory. Moreover it has become a vital element of conspicuous consumption in the emerging markets. According to the reshaping of the customer landscape, also with respect to geographical regions the conceptualization of diametrically opposing strategies in the target markets becomes an important prerequisite to survive over the long term (the economist, 2012). According to a study of 2011 of the opinion and market research organization „Sinus Institut” general tendencies in Germany are need for “regrounding” that is a desire to consume less, respectively more quality-oriented. Deceleration and sustainability are the key determinants. The cognitive overload of the multi-option society has a paralyzing effect. Furthermore the trend towards social dichotomization and “digital divide” is becoming more pronounced. The affluent social stratum has is anxious to be privileged and to distinguish from the rest of the population. The latter is defined as the “established milieu” and accounts for about 10 % of the German population (Sinus Milieus , 2011). In particular it constitutes the first target 7
group of RIMOWA. On international level there has been developed a “values and lifestyle system”´(VALS) which defines common customer typologies such
as “innovators”, “achievers” “experiencers” etc. RIMOWA could make use of this classification system when entering a new market, because the composition of the customer landscape differs in the international context. 5.2
Microeconomic conditions
The luggage market is particularly fragmented and subject to fierce competition. The market is flooded with numerous branded and unbranded products. However it is dominated by Samsonite followed by RIMOWA, VIP, Ace and a few more. According to recent tendencies competitor are increasingly concentrate on targeted advertising and promotion activities as well as on research, development, and designing of new products. (Global luggage market report, 2012). Whereas Samsonite suffered substantially from the economic downturn, RIMOWA did not face high losses as they are cater primarily to an affluent clientele from the luxury sector that is reportedly resistant to economic fluctuations, respectively counter-cyclical al as these people are eager to differentiate themselves from the other customers. This conclusion can be also drawn from Engels Law which postulates that people spend a larger percentage on luxury goods, respectively on non-food articles the higher their income. So in economic worse times people with insufficient funds are more likely to focus on bare necessities whereas consumption rate among rich people on precious goods keeps stable or even increases. Apart from that RIMOWA does not rely on the mass market and on revenues from large scales and therefore has a higher operational leverage.
6. Market dimensions
RIMOWA operates on the market as a pioneer (as before-mentioned) on an international level with a regional tie. One of their major aims is to signal their quality leadership. Above that they deploy multiple strategies in order to secure their position (explained under the heading “Market strategies).
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6.1
Market position
high price
Premium Brand
Manufacturer’s brand
Distributor’s brand
low benefit
high benefit
low price
modeled after “positioning cross”-Marketing cases Lauermann 2013 6.2
Market strategies
RIMOWA implements a tri-partite combination of focus- segmentation and differentiation strategy. All these types of strategies belong to the so-called generic strategies conceived by Michael Porter (Competitive Advantage, 1985) . On the one hand they attempt to cater to clearly defined and exclusive elite of customers which comprises the upper-medium income customers and affluent individuals. So they allocate efficiently their capital into this field in the sense of the six sigma model3 which promotes targeted use of funds and resources without misspending. This method follows the 80/20 rule- to achieve the maximum impact, the marketing plan must be clear, concise and simple. Apart from that they further divide their segment to specify sub-groups of customers. The differentiation aspect (the quality, the material, the comfort and the unique design) ought to set RIMOWA apart from their competitors.
3
six sigma- a quality improvement model developed by Motorola in 1985.
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The segmentation strategy is complemented with a special niche strategy. That is to say RIMOWA constructs customized luxury instrument cases for artists and musicians such as the Cologne band BAB, the guitar player Jimmi Page, the venerable rock band Kiss and the violinist David Garrett. Apart from this RIMOWA designs and builts suitcases and boxes for the occupational group “pilots” respectively the aircrew. In order to revamp their corporate responsible image RIMOWA has recently constructed a heart-shaped suitcase by order of the UN children’s fund UNICEF. (Morszeck, 2009)(ibid.)
6.3
cooperations
According to the environment interaction approach (Schreyögg, 2012, S. 76) RIMOWA takes up several measures to keep market forces in check, respectively to take advantage from opportunities. They have taken up strategic alliances with key players in the transportation, respectively travel industry that is Lufthansa and Porsche. RIMOWA has deliberately chosen a aircraft or car model form Lufthansa/Porsche for their advertising schemes which corresponds to their own characteristics and brand image. The trademarks all share tradition-oriented values, with a long story of success, all considered technologically or innovative breakthroughs with a unique and still classic design made by German firms that have acquired world fame. Together with Lufthansa RIMOWA is currently conducting a high-profile promotion tour in order to conquer the North American continent. With the JU 52 of Lufthansa they are crossing the Atlantic making stop-overs in several major towns. They report on the trip via blog entries as some kind of travelogue on a specially dedicated internet site.
In the case of Porsche RIMOWA has designed a suitcase which perfectly fits the interior design of the Panamera series. The 959 chassis is made
partially of aluminium for lightweight performance. Its air vents and the RIMOWA case’s grooved surface have the same industrial tech look in common.
The co-branding schemes aim to reciprocally reinforce the brand images or expressed differently it constitutes a mutual brand leverage.
6.4
segmentation
RIMOWA targets a niche market that is the luxury sector, respectively they also appeal to qualityoriented middle income individual. Their main market is further differentiated.
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The three main categories of customers are business people, affluent individuals and the professional group “pilots”. The Suitcases are designed for regular usage such as business trips or for vocational purposes and ought to offer maximum comfort and benefit.
7. marketing mix
In most literature sources the marketing mix is referred to as MC Carthy’s 4 Ps: product, price, promotion, and place- This factors represent the framework for the assessment of marketing activities. An amendment to this definition has been made for services adding to 4 further P’s, that is “People, physical presence (how the shop and website looks), process(quality of service aspects; delivery periods etc.) and physical evidence ( tangible objects that embody the service like tickets, brochures etc.). In the following the RIMOWAS implementation of the different elements of the marketing mix will be discussed. They apply a holistic approach of premium quality and exclusivity. This concept is reflected in every aspect of their strategy to keep a certain consistency.
7.1
product
RIMOWA is primarily a manufacturer of high-quality suitcases and bags for the high-end sector. core use: Transportation of luggage for short and long-haul journeys. Material: mainly aluminum and light-weight polycarbonate but also leather, polypropylene and nylon.
Series: The main lines are “Salsa”, “Limbo” , “Classic flight”, “Topas”, Pilot” which includes several subcategories such as “Salsa Deluxe” etc. The product names ought to convey the supposed product characteristics. Salsa and Limbo are particular styles of dance. It is obvious that the names refer to the ease of transportation with those suitcases. “Topas” on the other hand is the name of a crystal-clear and very hard mineral also known as “sächsischer Diamant”. Presumably the choice of name for the oldest model of the series is an allegation to the German origin of its inventor. The diamond-like appearance and the clear, hard substance may be indicative of precision work, unbreakable material and preciousness of the suitcase. The other two denominations “Classic Flight” and “Pilot” are simply descriptive.
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RIMOWA makes use of “mass customization” principles. Via their online shop customers can choose easily the product and select size, features, attachments, accessories, unique colors (chocolate, navy, prosecco, cognac, gold, silver, violet, aquamarine, etc.) etc. Acutally the assortment depth is very wide. according to individual needs. By suggesting appropriate accessories on their site, RIMOWA also utilizes “cross- and up-selling” potential. More product features can be composed either for business or for leisure. For instance a lap-top sleeve and file sections are useful for business purpose.
The different product variations and enhanced versions can be located in the fields “markt” and “product” development of the Ansoff Matrix.
competitive advantage: Distinctive design(grooved pattern), premium brand image, impeccable reputation, global penetration
Unique selling proposition (USP):
Features: state-of-the art technology(multi-wheels), impeccable quality(TÜV-certificates, multi-functionality, practicability(flexible adjustability), easy manageability, intelligent details such as add-a-bag holder, ergonomic construction (telescopic handle), waterrepellant
benefits: comfort, state-of-the art technology(multi-wheels), impeccable quality(TÜVcertificates), high durability, multi-functionality, practicability(flexible adjustability), easy manageability, premium brand image, status symbol, intelligent details such as add-abag holder, ergonomic construction (telescopic handle) RIMOWA has developed this combination of attributes that allows them to outperform its competitors. The clear competitive mission is “being the first choice worldwide among travelers for luggage quality, function and design.” (Ontario business report , 2012) (ibid.) They like it to be known as the most “gripping” travel companion in the world.
7.2
price
RIMOWA arbitrarily sets high prices which is called premium pricing. This strategy belongs to perceived value pricing. In general higher priced products of this category (high involvement product) are presumed to be of superior quality. Above that the prices constitute a psychological 12
“must” for affluent people as the prices create barriers likely to exclude buyers of lower income levels. The average price for a suitcase varies about € 500. 7.3
place
RIMOWA suitcases are distributed via several selective distribution channels.
They adopt a hybrid strategy. On the one hand they revert to direct selling via impressive show-room like flagship stores. These are located in located in large, metropolitan cities all over the world, for instance in Hong Kong, Taiwan, Beijing, Shanghai, Sao Paulo, Macao, Seoul, Munich and Toronto.
Definition and purpose of a flagship store:
a store in a prominent location, a chain’s largest store, the store that holds or sells the highest volume of merchandise, a retailer’s most well-known location, a chain’s first retail outlet, a store location with decor or merchandise mix that is distinctly different from the rest of the chain, or the store location in a chain which carries the most high-priced merchandise catering to the most upscale customers (Aboutcom, 2013).
On the other hand they sell via their own online platform and via intermediaries like mail-order houses and special online-shops. In order to preempt competition, respectively to make use of them, RIMOW even has their suitcases sold by some of them as part of their product ranges, an example is the Suisse company “Brunner AG”, a leading manufacturer of leather ware4. 7.4
promotion
Promotion is the 4th P of the marketing mix and consists of 5 sub-elements which are advertising, public relations, personal selling, direct marketing and sales promotion. As a matter of fact it’s a critical task to figure out the most effective way owing to the fact that budgetary constraints do not allow unfavorable investments.
Among the aims of promotional activities count positioning,
image creation, strengthening public awareness, increase of sales revenues, competitive retaliations.
7.4.1
advertising
With regard to advertising RIMOWA makes use of “product placement”, a rather subtle kind of advertising, that is their suitcases play a role in blockbusters, such as Ocean’s 12, Charlie’s 4
http://www.debrunnerag.com/portrait
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Angels, which have a high attention grabbing value. In the case of RIMOWA it’s a very effective strategy because despite the fact that they are not allowed to show the trademark in films, the grooved patterns of the suitcases are instantly recognizable. Product placement lays emphasis on the product’s status as a star.
Furthermore RIMOWA recurs to buzz marketing. This kind of marketing relies on the viral effect of social networks and social media to increase brand awareness. A buzz marketing campaign is devised to initiate a momentum of its own relying on the fact that people pass on their good experiences. A part from that RIMOWA has their products endorsed by celebrity testimonials. Via instruments like blogs, celebrities make seemingly casual statements in order to stimulate requirements.
Sample statement: “Take Your Luggage to a New Level With RIMOWA – you drive a luxury car then it needs designer luggage for three reasons: (1) It has a tiny trunk and you need to make the most of it; (2) It was pricey, you need luggage that matches; and (3) You love it So now you’ll be happy to know that RIMOWA is making custom designed luggage for you luxury car(…)”. Accordingly, Luxist bills these suit cases the “Cristal of luggage.” (Gutsche, 2006). Above that RIMOWA makes use of “experience advertising” and “story-telling” which is in vogue at the moment. This method relies on customer-generated content, a phenomenon emerged since the first decade of the 21st century. It’s also denominated as Web. 2.0 (O’Reilly, 2005) in which the consumers metamorphoses into a “presumers” contributing to the collective intelligence. So RIMOWA has established a blog called “every case
tells a story”. Every member can post messages of travel experiences with their RIMOWA suitcase including pictures. This strategy has also a personalizing effect.
The above-mentioned methods are emotional advertising strategies. But then RIMOW likewise appeals to rational decision-making as their products are certified by quality seals and TÜV reports.
In order to keep abreast of the competitors in terms of innovations RIMOWA has recently made their suitcases an “augmented” or “interactive” product in collaboration with T-Systems. By means of a smartphone app, all relevant information like weight and size of the luggage is transferred via bar code to the respective airline that can use this information for logistics and the reservation of optimum space for the passenger. By this means luggage can be easily tracked and is unlucky to go lost in transit5.
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http://www.t-systems.de/news-media/mobility-loesung-fuer-reisegepaeck-t-systems-airbus-und-rimowakonstruieren-kluge-koffer/1126206
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7.4.2
sponsoring
Another means to raise public awareness and to create an image is the sponsoring of high-profile events. Among others RIMOWA supported the the German National Soccer team when they traveled to South Africa for the 2010 FIFA World. More over RIMOWA had been official sponsor of VELUX EHF FINAL4 2011, a Cologne handball club6.
7.4.3
Public relations
Especially in the trade-oriented or the B2B business, respectively the luxury sector RIMOWA relies on creating networks and brand awareness via tradeshows and exhibitions. One of the pending fairs will take place in Toronto in 20147 “Interior Design Show Toronto”.
8. Conclusion
Owing to the fact that RIMOWA can look back on a story of success longer than a century and with considerable growth prospects for the future “In addition to high sales recorded in our traditional markets, we have grown exponentially in Hong Kong, Japan and South Korea,” said the CEO of Rimowa GmbH, Dieter Morszeck. “Above all, we welcomed the increase of 85 percent of sales in the U.S. market over the last year. This strengthens us in our conviction to arrive in time to be the no. 1 worldwide in the luxury segment for suitcases for travel ” (Morszeck, RIMOWA Mipel September , 2007), their strategies have proved to be very effective. This can be also attributed to their attitude of continuous innovation. Despite this fact there’s still huge potential to tap. As they are a globally operating enterprise they may focus more on a “glocal” strategy which means decentralizing the marketing schemes and adapting it to local cultures. Since their name is not as well known as their product, it would be worthwhile promoting more their brand’s name awareness. These measures would be very propitious for marketing in Japan, because in this country the corporate image is the most important factor when making purchasing decisions. Above that RIMOWA could operate as an umbrella brand. For instance they could add further product lines (leather ware) at a moderate price level and sell them at attractive in-store corners in shopping-malls. But then if RIMOWA fears to damage their outstanding reputation, they could submit seasonal special offers which huge allowances via online banners or corporate blogs. This way people with moderate incomes may be would be enticed to take their chance and 6
http://www.ehffinal4.com/de/news_detail.php?head=-RIMOWA-ist-offizieller-Partner-des-VELUX-EHF-FINAL42011&news_id=77 7
http://www.interiordesignshow.com/rimowa
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purchase such a quality good. So they could also reach other segments of the population. Another option would be the design and construction of ergonomic school satchels. Today there are often public discussions about the problem concerning overcharged and bulky school satchels. Furthermore RIMOWA could advertise in in-flight magazines. On-board the audience is likely to be more captive , as they have to bridge the time during the flight anyhow, e. g. by means of reading those in-flight magazines. Other effective print advertising could be business catalogues or specialist magazines. They could also e-mail to companies offering them creating tailor-made business travel or trade fair articles. Ma be they could sometime reconsider their legal form and opt for an IPO to raise additional funds. Their potential for a high market capitalization due to their solid position is huge. On the other this way they may really incur the risk and damage the core of their strategic attitude.
Another point is that RIMOWA could pay more attention to employer branding activities. During my studies on this subject I could not find any ratings or special reports on RIMOWA as an employer. As they currently employee more than 1000 people (Lauermann, 2013) they are reliant on new generations of qualified personnel.
In terms of sponsoring RIMOWA could opt for sports events that typically appeal to affluent people like golf. Moreover it would be a great opportunity to create cases and boxes for golf equipment. On the other hand they could support mediated extreme sport activities which would accentuate characteristics of their product like indestructability, toughness, reliability. When considering the “frugality” trend it would be a promising option to offer value-added services like after-sales consulting and repair and maintenance service In collaboration with Lufthansa or another airline they could offer loyalty programmes, such as frequent flyer cards which could incentives such as:” As soon as a certain amount of miles is collected, then a RIMOWA bag will be offered for free.”
