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Prada Group’s Strategy and Future Projections Term Paper

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Updated: Feb 4th, 2021

Strategic Questions for Prada Group

How will the Prada Group’s presence outside of the fashion industry affect its level of customer awareness?

Prada Group’s presence outside the fashion industry will affect the company’s customer awareness in the long run by influencing the company’s creativity, adjusting to the dynamics of its customers’ needs, and progress in creativity. It will also affect the company by presenting it with a platform for diversity, universality, and unequaled exclusivity, due to the insights drawn from the diverse disciplines and fields (Chaffee, 1985).

Will removing the “Made in Milan” trademark affect the view consumers have on these luxury items?

The removal of the “made in Milan” phrase will affect the credibility of Prada’s luxury items. This is the case, as the Prada brand is associated with the magnificence of Italy’s second-largest city, a country associated with the imminence of fashion and sophistication of many other fields. Also, with the increasing rate of trademark infringement, the removal may act against the success of the brand (Chaffee, 1985).

How can the Prada Group continue to thrive in the luxury goods market despite a struggling economy?

The Prada Group can succeed in selling their luxury goods in the struggling American market by keeping their target market in mind, in the aspect of price gauging, maintaining their innovativeness, remaining visible to the market, taking the customers’ needs and dynamics into consideration, and by maintaining its diversity and exclusivity, which is the company’s identity.

How can the Prada Group continue to do well and capture market share in the United States considered the current recession?

The move to pay dividends after the previous year’s IPO will serve to promote the reputation of the company and its brands, besides the American recession. The move will improve the company’s image before the investors; thus, the ability to earn more market confidence and investment. Additionally, the company’s dynamic strategies will help foster the company’s growth; thus, its market share in the U.S (Chaffee, 1985).

What makes the Prada Group so much better than their competitors, and how are they able to be more successful?

The company’s use of its wide network in maintaining its progress in creativity sets the company aside from its competitors. Through the wide network, the company relies on customer views and opinions to secure dynamics in meeting the changing market needs. The strategic design of the company’s fashions, the intensive production process, the company’s reliable distribution network, and the reputable image and communication strategy keep the company ahead of its competitors.

Should Prada continue to invest in this radical new way of shopping experience?

Should employees be better trained to use this cutting edge technology in epicenter stores?

The core of this shopping model is keeping to the established production fashion and allowing some space for wild creativity with a close collaboration between the customer and the fashion creator. This shopping experience is an asset to the company, as it aids the customers in identifying with the products delivered; thus, a sense of customer confidence and passion for the company.

Employees should be fully trained in the usage of the sale technology, mainly because the interaction of the client and the staff of the company can make the entire difference in catching the input and the confidence of the customers in the reputation of the products. Additionally, the company’s employees are the link to the customers and not the high-quality products and the brand of the company (Chaffee, 1985).

What solutions will be effective in solving high usage issues and system slow-downs during high demand times?

The company’s sale technology is based on seller customer relations, which result in delays, especially in the ties of high demand. In solving this problem, the company may offer a new communication platform and strategy, which should serve as a link between the employees and the company’s customers. Over such a platform, customer-employee collaboration and involvement can be affected. Across the same platform, creative functions like online selling and feedback systems can be incorporated.

Does the epicenter store’s increased traffic result in higher sales and profit?

The increased traffic was another cause for delays; hence, the possibility of customer disappointments from the delays in attending to their needs. As a result, the model has not caused any increment in sales volumes, especially due to the model’s delays. Prada’s architectural starts are also not yet fully identifiable with the customer population, to affects the sales flows considerably.

How does the company tackle consumer education of the new technology?

The new sale technology is really abstract for any customer or potential customer not conversant to the idea. The incorporation of modern architecture, cultural breakdown, and urbanism also create the need for intensive customer education. As an education move, the customer is offered a personalized card and offered demonstrations on use and access to the store. The company has further embarked on customer education on the new technology.

For Prada, the scope of this part of the analysis will involve the rise of the epicenter store and its rewards and challenges. Prada faces transforming all this value created for customers through the implementation of technology into value capture since their ultimate goal is to provide a unique experience and have customers return to create brand loyalty and profits (Lamb, 1984).

Value creation and value capture

What effects will PRADA Group’s current access to in-house improvements of technology have on the value creation and capture?

The effects of Prada Group’s access to in-house improvements on the value capture and value creation of the company include that customers and the other parties using the technology at the store will be able to access client information and identify different products. Also, the time taken by sales staff in attending to customers will be greatly reduced. The value to be drawn from the technology is that the client and the sales agent will be able to explore the products at the shop, using a few RFID tags, thus, saving their shopping time (Geroski, 2000).

Will the value creation and value capture differ among the cultures?

The success of the technology-based sales model will work better at markets where the customers are technologically experienced and knowledgeable. Also, the uptake of technology among different cultures may vary, mainly because established marketing orientations positively influence the effectiveness of the technology model’s adoption. The cultural base of certain cultures also affects the rate of technological uptake. For example, in France, despite the availability of internet infrastructure, knowledge of the use and freedom to use internet services, and the uptake of internet usage is much lower as compared to that of other cultural centers (Desphandé & Webster, 1989; Yip 1995).

Future Projections

Financial performance

A forecast into the future

From a track record of the company’s financial success, the company has been on the rise in academic performance, realizing additional revenues year after year. This can be partly attributed to the reputability of the products of the company, as well as the highly established strategic approach to technology and the dynamics of the market in meeting the changing customer needs (Lamb, 1984).

These are the financial forecasts of the company

Financial Year 2010 2011 2012 2013 2014
Net Revenues (000s of Euros) 1,561,238 2,046,651 2,555,606 3194507.5 4088969.6
Revenue increment 485413 508955 638901.5 894462.1
Percentage Revenue Increment 31.09 20 25 28

What would happen if the company does not follow the recommendations?

The projections offered can only be realized if only the company is able to widely diffuse the technology in an effective manner. The diffusion process itself should be affected by a cooperative operation of the model, by the different levels of employees, top to bottom, into using the technology. In getting the different staff and user levels to use the new technological sale model, they should be made fully aware of the benefits they will receive from adopting the technology. For example, the sales staff of the company can be offered information on how the technology will make their quest to locate customer information and display the different products at the stores very easy and effective. For instance, the system is able to show the products available at the store, thus, preventing customers’ disappointment after they find that a product they wanted to purchase has been sold off (Geroski, 2000).

What would happen if the company follows the recommendations?

From the implementation of the stated recommendations, the company’s marketing technology will improve the areas of planning, control of sales, implementation, training, recruiting, evaluating, and the motivation models of the Prada Group. From the array of the areas to be affected by the technological program, the company will be closer to the realization of its goals, including an increase in the efficiency of marketing. In evaluating the increment in revenue levels, the expenses to be incorporated in the account include those for the training for each employee, which are to be deducted from the revenue created due to the increased production efficiency (Lamb, 1984).

ROI (the technological program) = Revenue increment (from sales efficiency) – Training and technology cost (program costs).

The anticipation of competitors’ responses

From the realization of the sales increment, a corresponding revenue return will be registered. Prada Group’s competitors will adjust to the usage of the epicenter store model. In anticipating the effect of the uptake of the model or similar models by the company’s competitors, the company should seek to improve the technology so that the company will have the competitive edge as compared to the competitors (Lamb, 1984).

Sources of competitive advantage and organizational design

The impacts of the recommendations on the future of Prada include the ownership of a reputable service base, which will attract a large customer base and the ability to adjust to customer needs, from the incorporation of customer feedback modules into the system. Also, the organization design of the Prada Group will be centered on the integration of the marketing and other core models of the company (Lamb, 1984).


Chaffee, E. (1985). Three models of strategy. Academy of Management Review, 10(1), 57-62.

Desphandé, R.,& Webster, F. (1989). Organizational Culture and Marketing: Defining the Research Agenda. Journal of Marketing, 53(20), 3-15.

Geroski, P. (2000). Models of technology diffusion. Research Policy, 29(4/5), 603–625.

Lamb, R. (1984). Competitive strategic management. Englewood Cliffs, NJ: Prentice-Hall.

Yip, G. (1995). Total Global Strategy. New Jersey: Prentice-Hall.

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