The iconic Mambo clothing brand gained a controversial reputation in the 1980s for its bold and provocative prints, but the company is now switching tactics to focus on the mainstream, offering new apparel for discount department store Big W.
Like most retail businesses, Mambo has been hit with hard times in the past few years. The company was sold two years ago to Equity and Capital Finance Australia for just over $10 million, half of what former owner Gazal originally paid when it acquired the company in 2000.
Current managing director Angus Kingsmill would not disclose a revenue figure, but industry estimates suggest a ballpark figure of $10 million.
Kingsmill says the company is facing a challenge in differentiating itself from other discount-focussed brands, but believes the business’s strong reputation and history will help it stand out from the pack.
How has Mambo performed over the past year or so?
I’d be kidding if I said it’s been anything other than tough. But I think the brand has been performing well through our existing channels. The fact of the matter is we haven’t been in enough stores, we haven’t had a wide-enough distribution, and that’s part of the reason we’re moving into Big W.
Can you describe what else prompted the move into Big W?
Mambo is still in Myer, which we’re doing a completely different range for. We’re also in select surf stores, but the rationale behind moving into Big W is to just more widely distribute the well-known brand. It’s also part of our international expansion; we’re just trying to get it out there to as many people as possible.
Was that exposure something you felt the brand was lacking?
We just weren’t going into enough stores and reaching people. What we’re doing now is all about being accessible and at a price point that will reach a wider audience, without compromising the quality of the brand.
It’s quite clear through the GFC there’s been a big trend towards value offerings, and there are some great brands like Zara and Gap that are offering great products at value price points. So although we’re producing volumes of units, we can’t reach that competitive edge. So now that we’re going through Myer, Big W and other surf shops, we’re bigger and we’re able to offer that same type of value offering.
How is the Big W product going to differ from your other products?
The Big W offering is going to be a more basic, logo-driven product, but we’ll also have some great, big and bold graphics on this. It’ll be good quality stuff in there, we’re not compromising on that. With some of our surf accounts we’ll be pushing more of the controversial, irreverent prints. We also have to remember that in Big W we’re dealing more with families and so we’ll keep that in mind with design. The fabrics may have a different feel, but it’ll still be all the same quality.
The big question is, how are you going to make sure you keep your brand’s reputation without having customers feel you’re discounting with lower quality products?
This is something we’re constantly aware of. It’s going to entail a long PR push to get the message out there to let people know we haven’t compromised on the quality. We’re suggesting customers actually get out there, have a feel and then see what they think.
There will be some backlash, and we expect that because we’ve already had a tiny bit of it. But I would say that’s overridden by the fact we’ve had some good sales in the first few days since it’s hit the floors.
So it’s a combination of that approach and making sure we just keep the brand recognisable and strong. We’ve collaborated with the same people, we sponsor the right people and we think it’s those associations that are important.
Is there any type of business model you’re thinking of here?
I think a good example of this is Bonds, which has been able to operate in a number of different distribution models. Mambo is an iconic brand, so I don’t particularly think it matters what distribution channel you’re in as long as we’re keeping the quality high and being very clear in what sort of company we are. We’re just operating on a number of different price points now, and we need to make sure we’re managing the brand carefully. But it can be done.
What can you tell us about your international push?
We’re moving into the US next year, and we’re just finalising those details so I’m unable to reveal those names yet, and we’re also moving into Brazil. We’re licensing different aspects of the business, and we’ve got people doing different things for footwear, and apparel and accessories, and so on. We’re confident that will pay off for us.
What advice would you give small businesses that want to provide a budget-type offering, without wanting to sacrifice quality?
To be able to do this type of distribution across multiple price points, I think you need to have a strong brand. It’s all about investing in your brand and your reputation, because if you look at just discounting then it often doesn’t work.
The whole game has changed out there within the last four or five years. There is a huge market here that hasn’t been tapped into, in these types of department stores, and I think more expensive brands are starting to catch on to that. It’s a trend that hasn’t quite caught on in Australia, and I think we’re able to perform well in that environment.
Patrick Stafford is a freelance journalist and a former deputy editor of SmartCompany.
