Analysis: Is Ralph Lauren Corp. moving away from luxury?

Ralph Lauren Corp. made headlines with its June 7th announcement that it planned to close 50 stores and lay off 1,000 employees as part of a restructuring in response to lower sales.



The announcement didn't go into specifics about the luxury brand’s plans to correct its course. But some industry insiders speculate that the background of Ralph Lauren CEO Stefan Larsson, who took the reins of the company in September, holds the key.



Larsson came to the upscale company from Gap Inc.’s Old Navy division, where he served as global president. Prior to that, he spent 15 years with Swedish fast-fashion giant H&M. He is credited with revitalizing both brands.



MediaRadar, which provides ad sales intelligence, analyzed Ralph Lauren's advertising before and after Larsson's start, and says the data shows two key course changes that shed some light on their new strategic direction.



Here is MediaRadar’s report:

• 
  A move away from luxury. While Ralph Lauren’s total marketing investment level didn't materially shift year-over-year, there has been a decided move away from supporting their luxury lines. In the first five months of 2015, fully 55% of marketing was for Purple Label and Ralph Lauren Collection – their most expensive, most luxurious lines. Just one year later however, that allocation has been slashed to 26%. Instead, the lower-priced Polo and eponymous Ralph Lauren lines are the focus. Together they now represent 64% of all ads.


• 
  A narrowing product focus. In the five months from January to May, 2015, Ralph Lauren marketed 29 specific product lines. One year later this list was culled to just 14. The brands continuing with the most emphasis are Ralph Lauren, Polo, Lauren, and Denim & Supply. Smaller lines like Chaps and RLX didn't get marketing support at all.

"By analyzing their marketing spend carefully, we can see where Ralph Lauren strategy may be heading," said Todd Krizelman, CEO of MediaRadar.



According to MediaRadar, the data shows a key pivot from the company as the epitome of luxury designer wear to a focus on affordable fashion.



“For Larsson, this is a turnkey positioning solution, since he helped revitalize H&M and Old Navy to the powerhouse brands they are today,” the company said.



MediaRadar is a multimedia sales intelligence tools that tracks and provides insight into how advertiser dollars are spent across print, digital, mobile and TV.