Uniqlo Clothing Analysis

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23 Mar 2015 17 Jul 2017

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Keywords: uniqlo analysis, uniqlo expansion, uniqlo uk

Introduction

Japanese clothing brand, Uniqlo, specialises in stylish casual-wear which is both high quality and affordable. It is the predominant brand of the Japanese company Fast Retailing Company Limited and accounts for 90 per cent of company's total sales (UNIQLO UK). The first Uniqlo store opened its doors in Japan in 1984 and there are now over 760 stores across the country. Now a global brand, Uniqlo began international expansion with the opening of the first UK store in 2001, and it is Uniqlo UK which will be the focus of this report.

After introducing itself to the UK, it was not long before Uniqlo had 23 stores across England. However, the brand's simple designs did not prove popular and within two years 18 stores were closed (Marketing, 2007). Since its relaunch in 2007, Uniqlo UK has been gaining momentum, but it still has a long way to go towards becoming a leading fashion retailer in Britain. Consequently, this report aims to further this momentum through the development of a new integrated marketing communications campaign which would be implemented in 2010.

Summary

Context Analysis

Customer Context

Segment Characteristics

Uniqlo currently targets a very wide audience, describing its key demographics as:

  • Male and female;
  • Fashion-conscious;
  • Cost-aware;
  • and aged between 16 and 96! (UNIQLO UK)

Calgary Avansino, Executive Fashion Editor of Vogue magazine, has personally experienced the wide appeal of the Japanese brand. She said, “the store is for a young customer but at the same time I went with my mum who is 60 and she bought the skinny jeans in taupe and burgundy” (The Independent, 2009). However, the lack of focus which comes with having such broad segmentation results in an unclear brand identity, thus making it harder for Uniqlo to stand out.

Brand Awareness, Perception & Attitudes

Awareness

  • Every single one of Uniqlo's 14 UK stores are concentrated in and around London. Current marketing communications are therefore focussed mainly on the London area, and as a result awareness of the brand outside this region is low.
  • Include brand awareness pie chart + sentence about where they're from.

Perception

  • Uniqlo is generally perceived as “deliver[ing] true value - quality and style at a fair price” (Inside Retailing, 2009).

Attitudes

  • A random selection of Uniqlo shoppers on Oxford Street, London, were asked their opinions of the brand earlier this year. Eighteen-year-old student Rafaela commented on the versatility of the designs, stating they are “easy to mix and match”, and twenty-year-old textile design student Holly similarly said, “you can make the clothes look your own with more individual accessories. I love the massive range of colours.” Twenty-seven-year-old visual effects artist Nick liked “the fact that there are no naff slogans or logos”, and twenty-year-old textile student Iona appreciated Uniqlo's “simplicity” (The Independent, 2009).

Level of Involvement

  • Involvement is relatively low when it comes to Uniqlo's products. This is because it offers basic, inconspicuous clothing designs, none of which visibly feature the Uniqlo logo, and prices are reasonable which lowers risk.

Business Context

Market Positioning

  • “Clothes that can be worn by anyone, any day”;
  • “Uniqlo … focuses on quality and value with a broad demographic appeal, though it has aimed at attracting young trendsetters by collaborations with designers and artists.” (Mintel, 2008)

Current Marketing Mix

Product

Basics

      • Simple, plain designs for both men and women, in a wide variety of colours. Items include t-shirts, outerwear, knitwear, jeans, trousers, and accessories, as well as dresses and skirts for women.

HEATTECH

Uses unique material, developed by Uniqlo and Toray Industries, which retains body heat.

+J

Collection made especially for Uniqlo by designer Jill Sander, released 1st October 2009. In the words of Calgary Avansino, “Her look is classic and simple, but also cutting edge in the way she cuts and presents her clothes” (The Independent, 2009).

UT

  • Uniqlo T-shirts (a sub-brand);
  • Limited edition collections of t-shirts created by designers and artists from all over the world;
  • UT has a different image to the rest of Uniqlo's products and the t-shirts are promoted and sold separately. It will therefore not be included in the IMC campaign this report seeks to create.

Price

  • Basics - Jeans roughly £25, t-shirts £8-£14, cashmere around £25-£45 (Mintel, 2008);
  • HEATTECH - From £6.99 (UNIQLO UK, 2009);
  • +J - Outerwear £49.99-£99.99, bottoms £24.99-£29.99, shirts £24.99, jersey and sweats £14.99-£29.99, knitwear £19.99-£29.99, cashmere £59.99-99.99, accessories £14.99-79.99 (F.Tape, 2009).

Place

  • Physical stores: Currently 14 Uniqlo stores in the UK, including global flagship store on Oxford Street in London. The other stores are also all situated in the south of England, in and around the capital.
  • Online store: Uniqlo's comprehensive UK online store is an important distribution channel, allowing the rest of the country access to the brand.

Promotion

Advertising

Uniqlo UK generally avoids overt TV advertising, but it has recently released a TV commercial for its HEATTECH range (see Appendix ?). Uniqlo mainly invests in press (newspapers and magazines), and outdoor (billboards, in the subway, and on buses). Look to Appendix C for a table detailing Uniqlo's advertising spend, Appendix? for examples of Uniqlo's recent print advertising and Appendix ? for examples of their outdoor advertising.

This summer Uniqlo launched a global ad campaign for their new casual sportswear, featuring well-known models Agyness Deyn, Luke Worrall and Gabriel Aubry (see Appendix ?).

Public Relations

UT Cannes Lions Grand Prix 2010

  • Part of the Cannes Liones International Advertising Festival;
  • Annual t-shirt design competition held by Uniqlo;
  • The top 20 designs will be made into Uniqlo products, and the overall winner gets $10,000 (US);
  • Semi-finalists announced November 2009, finalists announced February 2010.

Uniqlo Jump

  • Collection of photographs of Uniqlo employees from around the world (UK, USA, Japan, China and South Korea) mid-jump, and wearing Uniqlo clothing.
  • Uniqlo Paper (Uniqlo's online and in-store magazine)
  • Articles in magazines/newspapers

Sales Promotion

  • Partnerships with specialised discount websites (www.vouchercodes.co.uk, www.hotukdeals.com);
  • Since January 2008, Uniqlo has been involved in an affiliate programme with LinkShare which has resulted in a partnership between Uniqlo and Marie Claire magazine. The Japanese brand received editorial exposure on Marie Claire's website, which featured ten exclusively discounted Uniqlo products (Revolution, 2009).

Interactive Marketing Communications

Uniqlock

  • Online clock which can be set to any time zone;
  • Features continuous rhythmic music, short clips of Japanese dancers wearing Uniqlo clothes every five seconds, and extended dance sequences every hour;
  • Users can post a mini version of the clock to Facebook, Bebo, Myspace or their personal blog, or they can download it as a screensaver or as an iPhone/iPod Touch application.

Uniqlo Calendar (similar idea to Uniqlock)

Uniqlo Introduction

  • Flash page attached to uniqlo.com;
  • Gives a sense of Uniqlo's brand identity and the range of clothing available.

In short, Uniqlo currently has a wide and varied marketing communications mix, and a lot has been done below-the-line to engage the consumer. However, the communications are far from integrated: the advertising campaigns are all rather individual, could quite easily be for H&M or Zara, and do not match the quirky, fun and distinctly Japanese character of many of the below-the-line communications.

Competitor Analysis

Competition within the clothing retail market is fierce, especially given the recent economic downturn, and Uniqlo has many well-established and similarly-positioned competitors to contend with. See Appendix C for a table comparing Uniqlo's annual sales total with those of its competitors. According to this table, Uniqlo's three most significant competitors are American clothing brand GAP, Spanish Zara and Swedish Hennes & Mauritz (H&M).

Gap

  • “Clean, classic, American designs” with mid-market stance (Mintel, 2009);
  • Has lost its distinctiveness and sales are falling (Mintel, 2008).

Zara

“Fast-moving fashions at affordable prices, inspired by the catwalks” (Mintel, 2009).

H&M

  • “Quality at the best price” (Mintel, 2008);
  • “[S]omething for everyone from modern basics to cutting-edge fashion … Although the UK customer base is heavily skewed to 15-24-year-olds (and women), it … appeals across the socio-economic spectrum.” (Mintel, 2009);
  • Number of high profile designer collaborations in the past, plus recent release of shoe collection from Jimmy Choo;
  • “Very strong identity in face of competition from other young fashion brands and potential for expansion.” (Mintel, 2008).

External Context

Stakeholders

See Appendix A for a diagram of Uniqlo's main stakeholders.

One of Uniqlo's most significant stakeholders is their suppliers. All Uniqlo products are made in the Far East, mainly in China. Fast Retailing does not own any factories but works closely with the same manufacturers year after year, thus developing loyalty and ensuring its products are of the highest quality (The Independent, 2009).

PEST Analysis

Political Factors

Globalisation has brought the UK and Japan closer together and, as a result, the two countries are increasingly acknowledging mutual interests and concerns (Embassy of Japan in the UK, 2000).

Economic Factors

After the recession, UK customers have become much more price-conscious. Customers are thus more likely to look for clothes of better value with greater longevity.

Socio-Cultural Factors

Japanese culture is very different to that of the UK, but elements of Japanese culture, particularly food, fashion and design, have already had a great impact in the West. It has been said that, in general, “Japan is increasingly the epicentre of cool with Tokyo its style capital” (Inside Retailing, 2009).

Technological Factors

E- and M-commerce are both growing rapidly, and the internet is becoming increasingly central in the worlds of business and marketing.

Internal Context

Organisational Identity

Fast Retailing, the parent company of Uniqlo, strives for excellence and efficiency in all it does, and, above all, it always put the customer first. See Appendix B for the corporate statement, mission statement, values and principles which constitute the details of Fast Retailing's organisational identity.

Marketing Expertise

After the store closures in 2003, Uniqlo's Marketing Chief at the time, Dominic Chambers, lost his job. In 2006, the former Merchandising Director for Dorothy Perkins joined Uniqlo and Marketing Manager, Amy Howarth, as part of a new team (Marketing, 2007).

SWOT Analysis

The following SWOT analysis has been constructed in order to highlight and summarise the main issues within the Context Analysis.

Strengths

High quality clothing;

Clothes are easy to mix and match;

Sophisticated textile technology;

Comprehensive online store;

Japanese identity;

Reasonable prices.

Weaknesses

Low brand awareness among target market in UK;

Brand identity inconsistent and does not stand out against competitors;

Uninspiring website design.

Opportunities

Popularity of Japanese culture;

High growth of E-commerce and M-commerce.

Threats

Economic recession (consumers with less disposable income);

Numerous strong competitors.

Objectives

Business Objectives

Open more stores across UK;

Before the store closures in 2003, Uniqlo (UK) had branches in the North West of England, the Midlands, Manchester, Liverpool and Coventry, and original plans had been to have 50 UK stores by 2004 (Times Online, 2003). Despite its increasing success, Uniqlo still only has 14 stores in the UK, and they are all located in or around London. In 2007, Chief Operating Officer Simon Coble stated, “We would like to be trading in all the major towns and cities in UK” (Marketing, 2007). Of course it would not be wise to try and open too many new stores too quickly as this approach failed the first time around, so a realistic target might be to have one or two new stores open in 2011, perhaps in Leeds and Glasgow.

Increase UK online store's sales volumes;

Currently the Uniqlo website is the only access Scotland, Wales, Northern Ireland and most of England have to the brand's wares. Therefore, until more stores are opened across the UK, the online store is vital. A 20% increase in online sales by 2011 would be a realistic target.

Increase market share.

Because the market is saturated, this will involve taking market share from competitors. A realistic target would be a 1.5% market share by 2011. The reason this percentage is so low is because Uniqlo does not even appear in Mintel's table of estimated market shares of leading retailers in womenswear from 2002 to 2007. Further, this table shows that Uniqlo's strongest competitor, H&M, only had a 1.2% share of the womenswear retailing market in 2007 (Mintel, 2008).

Communication Objectives

Increase consumer awareness and engagement among target audience across UK;

The brand is currently relatively unknown beyond London. In terms of the DRIP Model, this objective fits with the key task of informing the consumer. Of course, awareness is not enough on its own: the consumer needs to be engaged. Uniqlo already engage their consumers through such means as Uniqlock, but engagement efforts need to be furthered as awareness increases.

Differentiate from competitors through development of distinctive brand identity.

Analysts concluded that Uniqlo's initial losses after coming to the UK were due to the brand “fail[ing] to offer clothes that were sufficiently distinctive from rivals such as Gap, Zara, H&M and the recently revitalised Marks & Spencer” (Times Online, 2003). In terms of the DRIP Model, this objective fits with the key task of differentiating in the mind of the consumer.

Marketing Communications Strategy

Segmentation & Targeting

Look to Appendix E for a table of possible market segments for Uniqlo to target. This IMC campaign will use Segment 2 as its primary target. Because...

Positioning

Positioning Strategy

This IMC campaign will be based on a pull-positioning strategy, as objectives are to increase awareness and encourage involvement, and messages are to be directly targeted at end-user customers. A consumer-driven campaign fits with the value Fast Retailing places on approaching issues from the customer's perspective.

Key Message

The key message will be that Uniqlo provides the consumer with fashionable but simple clothing which is easy to mix and match and therefore allows each customer to create their own unique look. Uniqlo does not simply reproduce catwalk trends which result in everyone wearing the same thing: Uniqlo encourages individuality.

The brand already promotes a similar idea on their rather isolated online 'introduction', which can only really be stumbled upon as it is not linked directly from the main website. It states: “We're not a 'brand that dictates a total lifestyle'. To us, clothes are items the individual chooses to express a personal lifestyle” (UNIQLO INTRODUCTION). The aim of this campaign is therefore to make more of a feature of this message, and make it consistent across the rest of their marketing communications. It will be called the 'YOUniqlo' campaign.

Communications Mix

The tag-line which will appear throughout our campaign is 'Uniqlo. Mix it up.' It is concise, funky, and vague enough to apply to all our communications tools. It conveys the idea of doing things differently and, more specifically, relates to the fact Uniqlo's clothing is easy to mix and match.

Advertising

Advertising will significantly contribute to a rise in brand awareness and the development of a more definite and unique brand identity. It should also drive further business to the online store from across the UK as well as to the actual shops in and around London, and ultimately increase Uniqlo's market share. It is important to remember, however, that our target audience is advertising and marketing literate and will not be patronised by clichés and blatant selling techniques. The YOUniqlo campaign must avoid the overt, and instead offer quirky and entertaining ads which engage the consumer and, furthermore, project a consistent brand identity.

Print: Magazines

Magazine advertisements are good for creating impact and demanding readers' attention. Further, the sheer quantity of different genres and titles means it is easy to target a specific audience (Fill, 2009: 715). Judging by primary research, the chosen target market segment tend to read magazines such as Vogue, Cosmopolitan and Elle (). Particularly since these magazines contain extensive style advice, it would be wise to put print advertisements in them.

The YOUniqlo print campaign will use unknown, friendly-looking models who will be much more relatable than the likes of Agyness Deyn. This should bring the brand and the consumer closer together. The adverts will illustrate the 'mix it up' message through featuring one model superimposed three times in the same image. Each version of the model will be in a different pose and wearing a contrasting outfit. The outfits will all look very different but there will be some overlap in individual items, thus demonstrating the mix and match aspect. Appendix ? shows a mock-up of the womenswear ad, though the real ad would be portrait rather than landscape and have a plain white background. There will also be a version for menswear.

Outdoor: Transit Shelter Poster

The age group being targeted by the YOUniqlo campaign, in particular the students living in and around city centres, are unlikely to have cars. Therefore, advertising at bus stops would be a good idea.

Ten classic, relatively unisex Uniqlo items will be selected to make a series of transit shelter posters, with one item being used on each. They will each be nicely photographed front-on and look as though they are being worn, and will be shown life-size on a transparent background, positioned to match where they would sit on an average-sized person. Some interesting and amusing accessories will also be shown in order to create humour appeal. See Appendix ? for mock-ups of the posters. Involvement will then occur as people can pose behind the poster and have it look as though they are wearing the items featured. Since only one Uniqlo item will be shown on each poster, individuals will all look different as the items mix with their own outfits. This therefore expresses the 'mix it up' message.

Bus stops on central streets and around university campuses in major cities will be ideal locations for reaching the target audience and attracting attention.

Interactive Marketing Communications

Website

As acknowledged in the SWOT analysis, one of Uniqlo's strengths is their comprehensive online store. It is a great functional tool with easy navigation and simple checkout process. However, it currently gives no sense of brand identity, with the main page launching straight into new releases and current offers. Earlier this year Uniqlo collaborated with 4Ps Marketing, a search engine marketing agency, and through customised Search Engine Optimisation and Pay Per Click campaigns Uniqlo's only revenue has since increased by 30.76% (4Ps Marketing, 2009). It therefore seems wise to mould and expand the website into a demonstration of the brand as well as its actual clothing. This would add greater interest and individuality to the site, thus helping to differentiate the brand in the mind of the consumer. It would further engage the consumer, and ultimately help fulfil the business objective of increasing online sales volumes. As stated by Terence A. Shimp, websites “can be considered the centrepiece of companies' online advertising efforts” (Shimp, 2007: 443).

The general feel of the website should match that of the physical stores, which have a very streamlined look and give a firm - but not clichéd - sense of Uniqlo's Japanese identity (see Appendix ?). There should also be the option of signing up to a members' section, which will add users to a mailing list and give them access to extra features and exclusive deals.

Sponsored Facebook Group

Many retailers around the world already use sponsored Facebook groups as a way of directly marketing towards Generation Y, a new type of consumers highly influenced by the internet. Such online groups give marketers the ability to target a particular audience by using a ‘member list' to message people and inform them about new collections or events. As part of the YOUniqlo campaign, the sponsored Facebook group will operate in line with the PR activities, and messaging can be tailored depending on the location of the user in relation to that of the event. Consumers can also become more involved through use of the discussion board.

Public Relations

Organisation of a large-scale PR event would greatly help fulfil the brand awareness and engagement objective. It would not only grab the target audience's attention, but also that of the media, thus generating further publicity for the brand.

The YOUniqlo event will revolve around a nation-wide art competition, called 'Uniqlo Masterpiece' - appropriate as Uniqlo clothing appeals to artistic, creative people. Consumers will be attracted to a 'Competition' section of the re-launched website, where they can use a Flash application to create their own artwork using small graphics of Uniqlo clothing items in a wide variety of colours (see Figure 1).

This will emphasise Uniqlo's wide range of items and colours, and it fits with the 'Mix it up' concept as it encourages users to mix Uniqlo clothes to create something truly unique.

Entrants must be:

- Aged 18-25;

- UK residents;

- Signed up as member of the Uniqlo website.

After the competition closes, twenty semi-finalists from across the UK will be chosen by Uniqlo. Website members will then be able to vote for their favourite from the final twenty, thus creating further involvement and engagement. After the vote closes, five finalists will be revealed and invited down to London for the main event (travel expenses paid), where they will create a real version of their artwork using Uniqlo clothes on one of five big white canvases. The event will take place in the courtyard in front of Somerset House (see Appendix), and big screens will be present to show how the artworks look from above. Each finalist can compete as part of a group of up to four people. The event will have a DJ, be hosted by a local celebrity, and have a judging panel present to decide the winner at the end of the afternoon.

PRIZES?

+ Donation of clothes to Oxfam? ...which adds CSR into the mix.

Scheduling and Implementation

Table 1: Media schedule for 2010 YOUniqlo campaign

Taking the workings of the fashion industry into consideration, the print and outdoor campaigns will run in accordance with the release of new ranges at the beginning of each season.

Pre-Event

01/02/10

Re-launch of Uniqlo website together with opening of 'Uniqlo Masterpiece' competition.

 

01/02 -

31/03/10

Online entry using Flash application.

 

07/04 -

30/04/10

Online public vote from list of 20 semi-finalists.

 

07/05/10

Top 5 announced.

Event

05/06/10

Final event in London.

Table 2: Timetable for 'Uniqlo Masterpiece' competition

The competition has been timed so that the main event lands comfortably on Saturday 5th June. Nice weather is important for an outdoor event, and most students will have finished their exams by then.

Publicity for competition on website and through sponsored Facebook group. + Use Bluetooth on day of event to attract passers by.

Resources

The proper execution of the YOUniqlo campaign relies on Uniqlo's resources.

This resource has evolved to become a strategic function that perceives the association between talented people and the success of an organization. Uniqlo needs to have the strength of extensive man power to establish a successful marketing campaign. The human resource involved in the campaign includes the professional team which comes up with innovative print ads, the efficient PR team which has the ability to host an event by capturing the audience's attention and a tech savvy team which creates breakthrough in internet advertising.

The proper execution of a campaign depends on the financial resources available to support it. Uniqlo‘s most recent annual report available (2006) depicts that it has sufficient funds to carry out an extensive media campaign. The costs involved in conducting a campaign include the venue hiring costs, the cost of publishing print ads in magazines and the cost of publicizing the event through various websites. Uniqlo must treat this expenditure of conducting a campaign as an investment to create awareness about their brand and its uniqueness.

Justify cost of PR event + prizes by fact that they've already paid for supermodel Agyness Deyn + various celebs at Uniqlo flagship store opening.

Evaluation, Control & Feedback

Precisely, several post-testing tools will be applied (tracking studies and likeability test) to create reliable and validated feedback (Fill, 2009). Deciding on the scope of the evaluation, it is logical to refer back to the communication objectives and assess to what extent they were achieved.

Tracking studies will give the company a good view of communication campaign impact on brand awareness in the targeted regions of the UK. Interviewing a large number of people in these areas on a regular basis will also provide significant data on how their attitude and perception of Uniqlo has being influenced by all marketing efforts of the company. The awareness of the Uniqlo.co.uk will be easier to track by the number of hits from UK users. However, awareness on its own is not so important for the brand performance, unless level of engagement is also high. Youniqlo campaign was designed to create customer engagement with the brand and likeability analysis will aim to assess its success. The method will examine the level of entertainment/enjoyment people received from, for example, PR event or bus stop advertisements. A good showing here will also be the number of pictures uploaded to the company website. The likeability analysis will also demonstrate how well company has managed to differentiate itself from the competitors in consumers' minds.

QUALITATIVE. Recall tests.

Conclusion

Corporate Statement

Changing clothes. Changing conventional wisdom. Change the world.

Group Mission

  • To create truly great clothing with new and unique value, and to enable people all over the world to experience the joy, happiness and satisfaction of wearing such great clothes;
  • To enrich people's lives through our unique corporate activities, and seek to grow and develop our company in unity with society.

Values

  • Approaching issues from the customer perspective;
  • Embracing innovation and challenge;
  • Respecting and supporting individuals to foster both corporate and personal growth;
  • Committing to ethical standards and correctness.

Principles

  • Do everything possible for our customers;
  • Pursue excellence and aim for the highest possible level of achievement;
  • Achieve strong results through the promotion of diversity and teamwork;
  • Move speedily and decisively in everything we do;
  • Conduct business in a very real way based on the current marketplace, products and facts;
  • Act as global citizens with ethics and integrity.

(Fast Retailing, 2008)

Appendix C: Uniqlo's Advertising Spend, 2006-7

Total Spend

Cinema

Direct mail

Internet

Outdoor

Press

Radio

TV

£m

%

%

%

%

%

%

%

0.3

0.0

0.0

0.0

25.3

74.5

0.2

0.0

Uniqlo's total advertising spend and media used, year to end May 2007.

Source: Nielsen Media Research/Mintel (Mintel, 2007).

Appendix D: Total Annual Sales of Uniqlo and Its Competitors

Company Name (Flagship Brand)

Country

Fiscal Year End

Sales (¥ Billions)

GAP

USA

Jan. 2008

1723.7

INDITEX (ZARA)

Spain

Jan. 2008

1517.5

H&M

Sweden

Nov. 2007

1342.1

Limited Brands

USA

Jan. 2008

1108.2

NEXT

UK

Jan. 2008

666.2

FAST RETAILING (UNIQLO)

Japan

Aug. 2008

586.5

Polo Ralph Lauren

USA

Mar. 2008

533.6

Liz Claiborne

USA

Dec. 2007

500.5

Esplit

Hong Kong

Jun. 2007

415.0

Abercrombie & Fitch

America

Jan. 2008

410.0

Benetton

Italy

Nov. 2007

335.4



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