Armani Exchange: the dilemma of store expansion

Abstract

Learning outcomes In the light of the case study and the accompanying case study questions, the incumbent would be able to gain a comprehensive understanding on the theoretical underpinnings of retail store expansion, identify the challenges for expanding a brand into emerging markets such as India and apply various marketing strategies aimed at in-depth analysis retail expansion. Learners can further comprehend the importance of brand communication incorporated by the brand to attract its customer subset. Case overview/synopsis It was in December 2022, when Mason Chatterjee, the Indian brand head of Armani Exchange (A|X), was confronted with the managerial dilemma whether launching the second store in the city of Ahmedabad would be a right decision. Another issue that was troubling him was how to go about launching a second store in a city which was not a home to other luxury sublabels. The case study illustrates the decisional aspect of retail expansion adopted by Chatterjee, considering the distinct managerial perspectives. Chatterjee found potential in the city of Ahmedabad, owing to an increased number of high-net-worth individuals and other macro factors. The case study is primarily an outcome of research carried out at A|X store at Ahmedabad One mall, Ahmedabad, for over a fortnight in the month of February 2023. The expansion decision of Chatterjee proved to be a success in the city of Ahmedabad reaching a sales figure of INR 1 crore (US$130,344.11) in the very first month of its launch. However, he was confronted with the managerial dilemma of further expansion, just six months after the launch of the latest expansion. Complexity academic level The case study is intended for advanced undergraduates or postgraduate programs in management or electives such as marketing, retail management and strategic management. It has not only been specifically designed for teaching the concept of retail expansion but can also be used to integrate contexts on brand’s merchandise mix, retail positioning, visual merchandising and brand communication. The case study has an overview of each of these elements. The instructor may choose them into the context for a wider encompassing detailed lesson or particularly on the main aspect of the case. Supplementary materials Teaching notes are available for educators only. Subject code CSS8: Marketing