Op-Ed | What Went Wrong at Aquascutum?

Aquascutum A/W 2012 Show | Source: Grazia

It was a luxury brand that dressed the military through two world wars, but seemingly couldn’t make it through the recession. Today, in a guest Op-Ed piece, fashion market intelligence provider EDITD digs into the data to try to understand where Aquascutum went wrong.

LONDON, United Kingdom — In April of this year, at a time when Burberry posted an 11 percent increase in sales, fellow British heritage brand and trenchcoat maker Aquascutum fell into administration. A few weeks later the company was sold for a mere £15 million to a subsidiary of Hong Kong’s YGM Trading, which already owned the license to sell Aquascutum in Asia, the brand’s biggest market. But scroll back to the company’s beginnings and it’s hard to believe it all went so wrong.

In 1851, founder John Emary, a Mayfair tailor, patented a new type of water-resistant cloth and Aquascutum (Latin for ‘water shield’) was born. The company made officers’ coats during the Crimean War, outfitted soldiers of all ranks in both world wars and attracted a royal following, starting with King Edward VII. Over the years, Aquascutum has dressed the powerful (Winston Churchill and Margaret Thatcher) and the popular (Cary Grant, Humphrey Bogart, Sophia Loren and Michael Caine) and operated a large flagship store on London’s Regent Street for over 100 years.

Fast forward to 1990 and the previously family-owned Aquascutum was purchased by Japanese textile and apparel maker Renown for £77 million. In 2009, Harold Tillman and Belinda Earl, the team that rescued Jaeger, bought the debt-laden company from Renown for an undisclosed price. Now, less than three years later, the brand, which some analysts say has a stronger heritage than Burberry, is facing a total collapse.

So what happened? “Unlike Burberry, Aquascutum doesn’t own the licensing in Asia,” Martin Raymond, editor-in-chief of trend agency The Future Laboratory, told The Guardian earlier this year. “That is going to cause problems for any brand because that’s where a lot of the money will come from.” But as it turns out this was just one of many problems at the company. Here’s what our data reveals.


DATA IGNORED

Unbelievably, Aquascutum seems not to have tracked the performance of their products at the retailers they supplied. Indeed, our data shows that unsuccessful products were re-run in subsequent seasons, while success stories fell off the radar. For example, take Aquascutum’s £250 leather Regent Hobo bag from May 2011, which sold out in three colourways at Selfridges with no discounting and was subsequently re-stocked over the Christmas period. Was the Regent Hobo or the similarly successful £350 Regent Pouch bag from the same line reworked in an updated palette for the Spring/Summer 2012 season? No. Instead, the brand pushed its Hunter range of checked polyester and cotton bags with leather trims, a regrettable decision. At department store John Lewis, the Hunter small shoulder handbag was introduced in January at £225 and saw its price change four times before finally selling out seven months later.

CHAOTIC PRICING

The above-mentioned Hunter bag, which changed price four times in a single season, is just the tip of the iceberg when it comes to Aquascutum’s pricing woes. The brand’s most renowned product is the trenchcoat. In theory, they should have a clear, defined pricing strategy for this garment. But instead, our data reveals that their approach to pricing was completely chaotic. Take the Franca mid-length trench coat at John Lewis, which was introduced in May 2011 at £600. A few weeks later the price of the coat had dropped precipitously to £300. But by August the very same coat was back to £600, discounted to £475 for a week in October, returned to £600, dropped to £450, then £400, then up again to £650, before dropping to £350. Need we go on? It’s a merchandising nightmare and completely baffles the consumer. What is the value of the product? It seems Aquascutum did not have the right conversations with their buyers, nor tight enough control over how their products were sold.

But the Franca trenchcoat is just one example in a catalogue of errors that includes the price distribution of the brand’s products at major retailers. Indeed, buyers at the brand’s largest retail accounts invested most heavily in products in the £45 to £140 range. There is some investment in price points over £400, but not much, meaning that, although Aquascutum pitched themselves as premium fashion with a heritage, the price points of their product at major retailers were actually closer to Barbour’s than Burberry’s, creating a confusing gap between brand and pricing.

WHERE ARE THE DRESSES?

Alongside pricing problems, our data suggests that the Aquascutum product offering itself may have had critical flaws. Dresses are amongst the most lucrative product categories at any large womenswear retailer. This is true for two of Aquascutum’s biggest customers, Selfridges and John Lewis. And yet, Aquascutum’s seasonal runway offering paints an alarming picture. For Spring/Summer 2012, Aquascutum showed a mere five dresses. Compare this to Burberry’s ten and Mulberry’s fourteen. Dresses sell. Dresses are also what celebrities are most likely to wear to events where they are heavily photographed. Furthermore, dresses change so dramatically every six months that ardent brand fans buy again each season. A slight adjustment to a trenchcoat does not encourage a customer to make a seasonal update.

THE WRONG TRENDS

The heritage trend remains extremely powerful. Our data shows that the sentiment and volume of conversation around heritage has remained steady over the course of the last twelve months. Furthermore, Burberry’s success has hardly been a secret. Why, then, have Aquascutum been sending out sleek sport-luxe looks when they are so perfectly positioned to capitalize on the heritage trend? Designer Joanna Sykes has won rave reviews from the fashion press for her design sensibilities. But where is Aquascutum’s unique selling proposition? Clearly, the brand’s trump card is its British heritage, which was left unplayed. In the last year, we’ve seen massive global attention focused on the British Royal family, with the wedding of Prince William and Kate Middleton followed by the Queen’s Diamond Jubilee. This was a prime opportunity for Aquascutum to play up its British military history, but the brand missed a trick.

POOR CUSTOMER ENGAGEMENT

These days, for any brand, social media isn’t a “Do-we-or-don’t-we?” decision. It’s more like “Do or die.” Aquascutum were late to the game and although the brand managed to grow its social media fanbase during London Fashion Week last February, it was too little too late. Indeed, the brand only got round to launching a Facebook page in August 2011 and with only 338 followers, the page was later abandoned. Meanwhile, a Facebook page dedicated to Asia, the brand’s biggest market, only has 1,527 followers and a page for Aquascutum Golf has a mere 1,585 followers. Aquascutum joined Twitter at the end of January, just before London Fashion Week. But in the eight months since then, the brand has only tweeted 171 times. A poor show from their social team, indeed.

The visual merchandising on Aquascutum’s website has been equally unengaging. Our data shows that site content has been far too static. For example, last year, from October until December, the homepage featured the same image: a still from Tinker Tailor Soldier Spy promoting an Aquascutum trench that was featured in the film.

Taking a step back, it’s undoubtedly true that the biggest challenge facing Aquascutum was not owning royalty rights in Asia, a lucrative luxury market which has served other British heritage brands, like Burberry, so well. But only with the right product, pricing and customer engagement strategies would Aquascutum have been able leverage this opportunity successfully.

Here’s to hoping they shape up, before they’re shipped out altogether.

EDITD is a fashion market intelligence provider based in London.