The idyllic world of Ralph Lauren was tarnished last month when Ralph Lauren CEO Stefan Larsson announced the company would cut its full-time headcount by 8 percent and close 50 stores in response to lower sales. Taking a page out of the fast-fashion playbook—a script Larsson helped write during his time at Old Navy and H&M—the company said it also planned to significantly reduce its supply-chain lead times.
The plan made many retail analysts pause and question the company’s relevancy as a luxury brand. John Kernan, Cowen & Co. retail analyst told The Wall Street Journal, “Athleisure and fast fashion have created a dual headwind for the traditional polo shirt. There hasn’t been a lot of newness at the brand.”
Now, advertising experts are talking. MediaRadar, a company that tracks and provides insight into how advertiser dollars are spent across print, digital, mobile and television, analyzed Ralph Lauren’s advertising before and after Larsson’s start. MediaRadar CEO Todd Krizelman said, “By analyzing their marketing spend carefully, we can see where Ralph Lauren strategy may be heading.”
The firm noted two key advertising changes that shed light on Ralph Lauren’s strategic direction. While total marketing investment level didn’t materially shift year-over-year, MediaRadar said there has been a decided move away from supporting Ralph Lauren’s luxury lines. The advertising allocation for Ralph Lauren’s most expensive lines, Purple Label and Ralph Lauren Collection, was slashed from 55 percent during the first five months of 2015 to 26 percent one year later.
Instead, MediaRadar said the brand shifted attention to its lower-priced lines, Polo and Ralph Lauren, which now represented a total of 64 percent of Ralph Lauren’s ads.
The company is also reducing the amount of products lines featured in ads. From January to May 2015, MediaRadar reports that Ralph Lauren marketed 29 product lines. The company has narrowed it down to just 14 this year. The brands continuing with the most emphasis are Ralph Lauren, Polo, Lauren and Denim & Supply. Meanwhile, smaller lines like Chaps and RLX didn’t get marketing support at all.