Magazine article Marketing

Brand Health Check: Laura Ashley

Magazine article Marketing

Brand Health Check: Laura Ashley

Article excerpt

The retailer's clothing sales have withered as its trademark floral prints have fallen out of fashion. Rachel Barnes asks whether catwalk trends can help its business bloom again.

Laura Ashley has revealed just how outmoded it has become. The quintessentially English clothing and furniture retailer, best known for its floral prints, recently reported an 11.6% plunge in like-for-like UK sales for the past six months. Its homeware business, which had previously been growing, fell by 4.1%, while its fashion division suffered a decline of 28.2%.

The company began life in 1953, when Laura and Bernard Ashley invested pounds 10 to set up a business producing table mats, napkins and headscarves - made fashionable at the time by Audrey Hepburn in the film Roman Holiday.

By its 25th anniversary, turnover stood at pounds 25m.

The following 25 years, however, have seen significant change. In 1985 Laura died suddenly and the company floated the same year. In the late 80s the furnishings division, Laura Ashley Home, was launched, and in 1993 Bernard retired as chairman and moved to a non-executive role.The biggest change of all came in 1998 when, after several years of losses, Bernard resigned from the board and Malaysian conglomerate MUI Asia became a majority shareholder.

Following the takeover, chief executive KC Ng ditched design-led concepts in favour of a more commercial approach, and the target market was shifted from over-50s to over-30s. But turning its back on older consumers has proved costly for the business. While Home has performed solidly, with sales up 9% in 2003 and 0.1% in 2004, fashion sales have nose-dived. Fashion now makes up just 20% of its business and there are rumours the company could stop selling clothing altogether.

An outdated image has been blamed for its decline, but with floral prints taking over the catwalk this year, could Laura Ashley come back into vogue?

We asked Interbrand chairman Rita Clifton, who worked on Laura Ashley branding in 2000, and Alison Richards, managing director of home furnishings company The Pier.

DIAGNOSIS 1 - RITA CLIFTON, CHAIRMAN, INTERBRAND

Laura Ashley seems to be in a vicious spiral of falling sales, cost-cutting and a revolving door of chief executives (and even joint chief executives, which always looks desperate). It is the kind of brand we should really want to succeed as an illustration that all is well with the British sense of style and living. The fact that it is now majority-owned by a company outside the UK does not have to mean we can't love it any more - think Mini and BMW.

The critical thing is to get the right brand insights and then use them intelligently. …

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