The Polo Ralph Lauren Business

RALPH LAUREN

Now a publicly-traded company, the Polo Ralph Lauren business model is built around six primary objectives designed to keep the brand strong while bringing in the big bucks:

•      Creating unique businesses primarily centered around one core and heritage-driven brand;

o   The ability of PRL to maintain a singular "American Aristocrat" image has provided unity across the brand in all product categories, and has enabled the company to take a leadership role in this now- saturated market. (If you create the market, you basically own it until someone else does it better, and so far nobody has done it better than RL.)

•      Diversifying and expanding products and prices, distribution channels and geographic regions;

o  PRL is creating something for everyone in most price ranges to ensure that anyone who WANTS to own a piece of this imagined American lifestyle can.

•      Improving brand control and positioning;

o   When the company has direct control over distribution and quality control, they can ensure that the brand represents the same image everywhere. This is important in an era when customers travel the world and have access to infinite information online. If the brand is poorly represented in one market, a customer seeing this is less likely to think the brand's product is worth a high price in a more successful market.

•      Focusing on selective strategic partnerships;

o   The company needs the best partners to represent their image properly,

produce products and deliver them with expertise, and reduce costs in line with company goals. When PRL selected a poor licensing partner for their Home Collection, a lot of damage was done to the brand through low quality products, delayed delivery, and high costs.

•      Implementing infrastructure improvements that support a worldwide business;

o   This doesn't just mean building the best "American-style " stores in key markets, but creating a logistics system that enables the company to do efficient business around the world and training employees everywhere to represent the image of Ralph Lauren in the same way throughout various cultures.

•      Funding expansion through strong operating cash flow.

o   This enables the company to use its own money from sales and royalties to fund activities that would otherwise require great external debt. Not only is this good financial management, but it gives the company the freedom to invest in critical initiatives without having to depend on an external party.

Currently, PRL is focused on growing the brand internationally, opening stores in new markets and strengthening the perceived brand image in key areas.