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Swiss Army: Diversifying Into the Fragrance Business

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Swiss Army: Diversifying Into The Fragrance Business
Student Name: Xiaoyue LYU A00382505
Course Number: MKTG 2270.1
Problem:
Should Victorinox maintain the company current product portfolio or should they really diversify their product line into the fragrance business?
Analysis:
* Victorinox currently has five different product line: Swiss Army Knife, Cutlery Knife, Watch and Luggage, all categories have common core value of quality, innovation, functionality and iconic design. * France market has huge potential for Victorinox with $23.5 billion market value and 65% in the premium market which suit Victorinox’s position, also there is 33% in mass market which could be considered. * There are positive forecasts on growing middle class in emerging markets. Also there are growing demand from consumer in Generation Y, which are in their late teen to middle age. * According to company history, it had been successfully transferred brand attributes to watches and luggage before in 1989 and 1999. * Victorinox has large number of shop-in-shop retail stores and strong relationship with e-commerce sites for luxury products. This proved that they have ability to sale its fragrance product, as for fragrance market 55% of the market are being distributed by department stores and special stores. * Consumers are recognizing brand-consciousness especially for well-known brand. Victorinox represents strong brand image - reasonable price for top quality products. * Although Victorinox did not have experience in fragrance market before but Wenger has it before. Fragrance market is representing around 31% of its total sales, which is a large portion for Wenger. * Victorinox is a international company with massive production. Around 28,000 knives and 32,000 muti-tools being produced daily, and 90% of the production is exported globally. It also

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