Merchandising for car companies is big business and the best car company at it is Ferrari. Ferrari is very conscious of its brand and how customers and potential customers perceive that brand. Ferrari means luxury and their cars, Formula 1 team and anything else branded with the Prancing Horse must reflect that.
You most likely will never be able to afford to purchase a Ferrari car, but a cap, key chain or t-shirt is more likely within reach. That’s certainly the case for me and I think that I would have at least ten Ferrari t-shirts in my wardrobe. A small selection of my collection and my children’s collection is pictured above.
Ferrari has 45 physical merchandising stores in all, 16 are owned by Ferrari and 29 are franchised. In addition they also have 400,000 registered users for their online store, with yours truly being one of them. I’ve also visited the Ferrari store in Maranello and the Nurburgring.
Ferrari merchandising seems to know no bounds and they are always looking to expand their branding. It currently includes sportswear, watches, accessories and consumer electronics.
Interestingly, Ferrari doesn’t do any general advertising to promote their brand. Rather they use various racing activities, with Formula 1 being a core element. Ferrari also looks after their customers because in 2016 60% of all new car sales were to previous Ferrari owners.
Ferrari acknowledges that the ongoing success of the brand is somewhat dependent on the success of its Formula 1 team.
In 2016 the revenue from sponsorship, commercial and brand activities comprised 15.7% of all revenue for the Ferrari Company. This equated to €488million, an increase of 10.7% from 2015. This revenue was generated from the Formula 1 team, merchandising, licensing and royalties.
Other car companies must look at these results with envy and do their best to replicate them. Aston Martin for example opened a brand experience boutique in 2016. The shop is located in the exclusive Mayfair District of London where fans of Aston Martin can purchase a range of clothing, accessories, luggage and gifts.
Think of any major car brand and they all have a range of merchandise for owners and fans to purchase and show their support for that company. Why are car companies so keen to have a range of merchandise for us to purchase?
Well firstly, fans are paying them to advertise their brand, so that’s a double win of revenue and advertising.
Secondly there would be considerable mark ups on these items, so greater profits are to be had on merchandise.
It’s little wonder that car companies are looking to foster relationships with clothing and accessory manufacturers. Watches, sunglasses, shoes, and clothes you name it and a car company has put its logo on it and we love it all.
I will see you at the race track; I’ll be the one wearing my Ferrari t-shirt, shoes and hat.
Ferrari information was taken from the 2016 Ferrari Annual Report.