Another factor contributes to the decrease in popularity of the Italian group:
the company owns only 25% of the whole shops worldwide while companies such as Zara possess all their stores. As a result, the company cannot manage its shops properly and is not aware of what the clients are expecting. It’s then very difficult to track demand and adapt its products to the customer’s expectations.
Advertising is also one of the company’s recent weaknesses. In the past, Benetton’s ads were very famous and popular with clients. So
the company keeps trying to create a new buzz, thinking of it as a winning formula. However, the company has gone too far. Take the example of the United States, when the company launched its campaign publishing pictures of American prisoners sentenced to death, it provoked outrage. As a consequence, American sales started to decrease (dropping to 4 percent of total revenues at the end of 2010 from about 12 percent in 2000) and the multinational store chain Sears cancelled their contract.
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Information Correct:09/05/2013