Live, breathe and wear passion

A Diesel case study

Page 1: Introduction

Have you ever heard of passion in the marketing mix?

How about people? Those two Ps never seem to figure
alongside the famous four which you, will of course,
know by heart. This case study shows that having the
depth of passion and the right people are crucial missing
links in binding the regular Ps together.

Diesel builds its entire existence around the passion for

what it does. With a founder who sees his work as an art
and not a science, the company has redefined how a
brand sees and communicates with its customers since
1978. It is the Diesel story we will look at in this case
study.

Diesel is a global clothing and lifestyle brand. With a

history stretching back over 30 years, the company now
employs some 2,200 people globally with a turnover of
1.3 billion and its products are available in more than
5,000 outlets. However, this list of numbers is far less
interesting than the company, people and founder behind
them. Diesel is a remarkable company with a unique
mindset. A mindset which puts sales and profit second to
building something special, something cool and something which can change the world
through fashion.

The story begins with a young Renzo Rosso passionate about the clothes he wears but
disappointed in the options available to him in his home town Molvena, Italy. Acting on impulse,
he decided to use his passion to make the clothes he wanted to wear. Renzo was drawn to the
rebellious fabric of the 1960s and rock & roll: denim. It inspired him to create jeans which would
allow him and others to express themselves in ways other clothing simply could not.

Proving popular, Renzo made more and more of his handcrafted creations, selling them around
Italy from the back of his little van. The still-young Renzo is the proud owner and CEO of Diesel
along with that impressive list of figures. That impulse and passion apparently paid off.

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Page 2: Product

Diesel sells nice jeans. Close, but no A. Actually, its not

that close. The reason Diesel has grown is because it knows
it is about a lot more than selling nice jeans. Diesel is a
lifestyle: if that lifestyle appeals to you, you might like to
buy the products. Renzo describes this as an end of the
violence towards the customer forcing them to buy and
rather an involvement in the lifestyle.

The brand
It might be useful to ask a question what actually is a
brand? The answer could take a variety of routes and go on
for pages but a useful way to think of a brand is as a set of
promises. Those promises form the basis of the customers
relationship with that company. In the case of Diesel those
promises are very personal, very passionate.

The Diesel brand promises to entertain and to introduce

customers to new, experimental experiences. Its product
line now goes far beyond premium jeans and includes
fragrances, sunglasses and even bike helmets. These products complement, convey and support
the promises of passion and experience made by the Diesel brand.

Being such a crucial element of its work you might imagine the product design team at Diesel to
plot in something akin to a war room, pushing little squadrons of well-dressed soldiers around
with long sticks. Actually, this is where that elemental passion which created Diesel sets them
apart from many others. The whole team at Diesel lives the brand. They are all incredibly
passionate about their creations. So when it comes to expressing that passion, ideas come
naturally. Living and breathing the set of promises the Diesel brand communicates means
employees can listen to their instincts, creating products straight from within.

Page 3: Promotion
'Be stupid'

With the launch of the recent marketing campaign around the phrase Be Stupid , Diesel took a
look at what brought its current pipeline: it was Renzo Rosso, all those years ago, taking the
stupid move to make jeans he wanted to wear. Then he took the even more stupid move of
trying to sell those jeans to others, believing he might not be the only fool in Molvena! As it
turned out, there were quite a few more to be found and Renzo's stupid move ended up
creating something which millions of people around the world now enjoy.

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Promotion and marketing at Diesel
takes a very different route to many
other companies. It is always about
engaging with the customer as
opposed to selling at them: creating
an enjoyable two-way dialogue as
opposed to a hollow one-way
monologue. All elements of Diesel's
promotion aim to engage the
customer with the lifestyle. If they
like the lifestyle, they might like the
products.

For example, the Diesel team saw music as an inseparable part of that lifestyle and realised that
exploring new music and new artists was all part of trying something different and
experimenting with the unusual. 10 years later, Diesel:U:Music is a global music support
collaborative, giving unsigned bands a place where they can be heard and an opportunity to have
their talent recognised. It's not about selling, it's about giving people something they will enjoy
and interact with.

Tied to Diesel:U:Music is an online radio station. It is another example of where Diesel

unconventionality has created something which pushes conceptions and the usual ways of doing
things. The radio station takes a rather unusual approach of not having a traditional play list but
rather gives the choice to the resident DJ. This freedom is reflected in the eccentric mix of music
which is played on the station.

Above- and below-the-line

In promotion and marketing, we often talk about above-the-line and below-the-line methods
of reaching consumers. Above-the-line marketing is aimed at a mass audience through media
such as television or radio. Below-the-line marketing takes a more individual, targeted approach
using incentives to purchase via various promotions. In this case passion again acts to blur and
gel the boundaries between the two approaches. If we had to define this approach in terms of
theory, we would call it through-the-line, i.e. a blend of the two.

The passion and energy embodied by the Diesel lifestyle is communicated through a mix of
above-the-line and below-the-line approaches. The balance and composition of that mix is what
the Diesel team hands over to their passion and feel for the company and brand. That energy
guides the way this abstract theory is realised in projects such as Diesel:U:Music and the Be
Stupid campaign, which entertain and interact with their potential customers.

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Page 4: Place

Another, drier, way of describing place in the marketing mix is channel or distribution
channel. The way a business chooses to offer its products to
its customers has a huge impact on its success.

Only around 300 of the 5,000 global outlets which sell Diesel
products are owned and managed by the company itself. The
majority are large department stores offering many other
brands or boutiques with a very specific style of their own.
How do you maintain the quality of a product and its
communication when dealing with so many different partners
and distribution channels?

Culture
The strong culture within Diesel again holds the answer. Every
employee is able to communicate the brand appropriately in their
given role within the company. As such, the managers of the
Diesel-branded stores know that their function is to act as a
flagship. They focus on the core campaigns like Be Stupid
giving a solid focus and image for the brand. Employees in
each of the stores all know the campaigns intimately and are
very aware of the image they should put across to customers entering the stores.

Their retail partners such as the department stores are a crucial link in the chain. Diesel works
closely with these partners to ensure they express the same level of passion when offering their
products. This is done through separate and individual campaigns. These provide visitors with a
unique experience which again encourages them to get involved with the Diesel lifestyle as
opposed to forcing products on them.

Distribution

This approach to distribution can be seen as a mix of exclusive and selective distribution over
intensive distribution. Exclusive distribution involves limiting distribution to single outlets such
as the Diesel flagship stores. Selective distribution involves using a small number of retail outlets
and partners to maintain the quality of presentation and communication to the customer.
Intensive distribution, on the other hand, is commonly used to distribute low price or impulse
goods such as sweets.

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Page 5: Price

The price of a product is so much more than a little, or rather big, number on a tag. The price of a
product is the most direct and immediate tool a business can use to convey the quality of its
product at the point of sale. If done right, the price reinforces the rest of the marketing, drawing
in the target customers by conveying the appropriate quality.

Pricing strategies

Diesel uses a model based on premium pricing.

As we have discussed, Diesel is far more a
lifestyle than a clothing brand. Through the
vision and passion of Renzo Rosso, the
company has created a whole new approach to
engaging with its customers. The price of
Diesels products needs to reflect the
substance and value of that experience.

A strategy such as penetration pricing used by

businesses making high-volume, relatively
low-margin products would be inappropriate as it would undermine the quality association thus
devaluing the brand and experience.

We do not pay a premium price for Diesel jeans because they are a premium quality, that is taken
for granted. We pay a premium price because the jeans and the brand fit in with and even
encourage a premium, dynamic lifestyle built for successful living, as Diesel would say.

The team at Diesel must be intimately in tune with that lifestyle so they can see how their diverse
range of products from jeans to fragrances and even bike helmets fits within that lifestyle. That
feel for what Diesel is and how we, the potential customers, interact with it allows the company
to price those products in a way which
complements and neatly fits into that
lifestyle.

Page 6: People

Besides the fact Renzo has, let's say, done

alright for himself, he has inspired thousands
of people who proudly work to build the
brand through a shared passion and
contagious ambition.

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 Looking at the structure within which all those people
work can help us to understand just why they are so happy
to be there. Renzo realised people and their ideas form the
heart of the company. So that everyone's voice can be
heard and each person working for Diesel has an equal say,
the company adopts a flat hierarchy. This means there are
very few layers of management and everyone is
encouraged to communicate with each other: sharing ideas,
solving problems and trying to communicate that energy
with people outside the company the customers.

Teamwork

When decisions are made in this flat hierarchy they are

made as a team. The team as a whole can then track the
progress of that idea and monitor the results. Feedback is
important because if everything has gone to plan, the
achievement has to be acknowledged so that everyone can
take pride in what they have done. If something has not
gone to plan, group feedback allows an evaluation of why
and the ability to learn for the future.

Motivation

Importantly, this acknowledgment or learning happens equally across the company so everyone
is kept up to speed on the ups and downs of business. This sense of belonging both to a team but
also to a particular responsibility is very important for employee motivation. The better you
understand your work and your environment, the happier you are likely to be with your job. The
happier you are, the less likely you are to want to leave and so this open approach has the very
positive company-wide effect of high employee satisfaction and a low staff turnover.
Specifically in the fashion industry this means that the people working for Diesel have a stronger
sense of identity and a deeper understanding of the brand making them even better at what they
do.

Page 7: Conclusion

The marketing mix is all good and well but it doesnt paint the full picture. To understand it we
must look at the touchy, feely elements of business which are less often discussed. Diesel has
built its existence around that touchy, feely passion with every one of its 2,200 employees living
the Diesel brand. Diesel is the perfect company to allow us to see how this dry theory actually
works in real life: how the passion of a founder like Renzo Rosso can be communicated around a
company and breathed into each and every one of its diverse products.

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Diesel grew into a global household name for premium clothing but it all started from that one
man wanting to do something unusual, something stupid. Stubbornly he stuck to his belief in
doing the unusual and it has created a global company whose products are enjoyed by millions.
More importantly, this has created a lifestyle a whole new approach to the way we see a brand.
Diesel is an experience which interacts with and entertains its customers a far deeper relationship
than most other brands.

Being driven by passion and the desire to do something special naturally ties these elements
together. Understanding theory like the marketing mix in a company like Diesel can be difficult
if we expect the elements of price, place, product and promotion to be separate from each other.
It becomes easier if, like a magic eye picture, we look beyond the dry theory and realise all of
these elements are inseparably bound together by the passion of people like Renzo Rosso who
have dedicated their lives to treating their work as an artistic expression of their feelings.

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passion/introduction.html#axzz4HBx6WlV8

Pertanyaan Studi Kasus:

1. Menurut anda apakah Marketing Mix dapat diaplikasikan ke bisnis anda? Pilihlah satu
Marketing Mix yang sesuai.

2. Setelah anda membaca cerita tentang brand Diesel, kesan apakah yang didapat dari
anda mengenai brand ini?

Untuk studi kasus ini dapat dikumpulkan minggu depan sebagai hasil terakhir kelas
FBB.