Comparative Study of Uniqlo, Aeo and H&M [PDF]

Citation preview

INTER DISCIPLINARY MINOR ASSIGNMENT I COMPARATIVE STUDY BETWEEN H&M, AMERICAN EAGLE OUTIFITTERS AND UNIQLO TO DECIDE THE ENTRY MODE FOR UNIQLO IN THE UAE



SUBMITTED TO:



SUBMITTED BY:



MR. BINAY BHUSAN JENA



BHASWATI PANDA



ASST. PROF



HIMANSHU SHARMA



DEPT OF FMS



KAUSTAB BRAHMACHARI LIZA SETHY VAISISTHA BAL



1



INTRODUCTION TO THE BRANDS H&M The company was founded by Erling Persson in 1947, when he opened his first shop in Sweden. The shop, called Hennes (Swedish for "hers"), exclusively sold women's clothing. In 1968, Persson acquired the hunting apparel retailer Mauritz Widforss, which led to the inclusion of a menswear collection in the product range and the name change to Hennes & Mauritz. H&M’s vision is to lead the change towards a circular and renewable fashion industry while being a fair and equal company. H&M pursues the strategy focused on the long-term view which combined with the distinctive business model ‘high fashion at low prices’ provides the company with a sustained position in the apparel market.



H&M: From Fishing store to world’s second largest fast fashion brand



AMERICAN EAGLE OUTFITTERS American Eagle Outfitters was founded in 1977 by Jerry and Mark Silverman and is a leading specialty retailer of casualwear for a young demographic. It honours individuality and celebrates self-expression. AEO strives to be a part of that lifestyle beyond just fashion. Casual comfort and a relaxed attitude have made



2



AEO the brand it is today. AEO clothing is focused on the “all-American” look and creates the identity of a clean-cut young adult for their customers. VISION: AEO® is built on trust, honesty and integrity.



The first American Eagle Outfitters Store in Michigan UNIQLO Uniqlo is an apparel brand that is a wholly owned subsidiary of Fast Retailing Co. Ltd. In 1972, Tadashi Yanai inherited his father’s chain of 22 men’s tailoring stores, Ogori Shoji in Ube, Yamaguchi. Shortly after becoming company president in 1984, he opened a new store – Unique Clothing Warehouse, which was later shortened to Uniqlo. Now it is a global brand with over 1000 stores around the world. The company has exploded in the past decade, becoming Asia's biggest clothing retailer. Their vision is bold; to become the number 1 clothes retailer in the world. They believe that this dream can be achieved through providing the best customer service experience on the high street. UNIQLO’s business is, and has always been, customer-driven, and customer-first.



3



DETAILED STUDY OF THE EXISTING BRANDS IN THE UAE EPRG FRAMEWORK 1. H&M Ethnocentric (1947-1965) H&M operated with an ethnocentric orientation within Sweden for a number of years to help develop a strong brand as well as market and operational knowledge. As H&M began its early incremental expansion, it portrayed ethnocentric characteristics such as limited changes to products due to the similar styles and cultures of the Scandinavian countries in which H&M operated. Regionocentric (1964-2001) As H&M progressed through their global expansion strategy it appears they bypassed the polycentric orientation stage, instead opting for a regionocentric orientation which views global market opportunities on a region-by-region basis. This is reflected in their incremental expansion throughout Europe (1964-1999) and North America (2000-2001). It can be argued that the success of H&M’s westernised expansion can be attributed to the cultural assimilation between these countries/regions and the influence this has on consumer trends and purchasing decisions (Guo, 2013). Geocentric Transnational (2001+) H&M’s recent strategy has seen their orientation change as their management beliefs and assumptions have developed to consider the potential of a global market and the need to develop integrated global strategies. This is evident with H&M’s 2007 organisational restructure. This suggests a move towards a transnational company as H&M look to utilise their global supply chain to serve global markets. 2. AMERICAN EAGLE Ethnocentric: AEO focused on ethnocentric approach toward their business from 1977 – 2001. Within this time period they opened nearly 933 stores in United States. Polycentric: AEO approached for polycentric framework when they opened their first store in Canada in 2001. Regiocentric: In the year 2010 & 2011 AEO focussed entirely on the middle – east markets. They considered the Middle East as a region because their market requirements are same. In 2010, AEO opened stores in Kuwait, Riyadh, and Dubai. A store in Kaslik near Beirut, Lebanon, was opened on October 15, 2011. A store in Cairo, Egypt, opened in late 2011. Its first store in Jordan opened in November 2011 in the brand-new Taj Mall. Geocentric:From 2010 onward AEO adopted geocentric framework for their internationalisation process. In September 2011, two stores opened in Moscow, 4



Russia. Its first store in Tokyo, Japan opened on April 18, 2012. The first store in Tel Aviv, Israel, opened in February 2012, after the Israeli-based clothing retailer FOX signed a contract with AEO and have expanded to Jerusalem, Israel. Currently, there are also stores in Beijing, Shanghai and Hong Kong. American Eagle Outfitters opened its first store in the Philippines in March 2013. MARKETING STRATEGIES CONTROLLABLE VARIABLES: SEGMENTATION AND TARGETING SEGMENTATION STRATEGY: These are approaches to subdivision of a market or population into segments with defined similar characteristics. H&M Demographics and psychographic segmentation are used for H&M to reach all their customers. H&M is spread throughout the world. This means that the company targets many religions, culture and lifestyle. Therefore, their marketing has to be done differently in different areas: Demographic Segmentation 1. Segments by class: H&M strategy is offering high fashion at low prices, typically targeting working class, lower middle class and students. 2. Segments by class/home: The most popular segment is women aging between 15 and 30 years, either still living at home, in student dorms, or in their first house in urban regions 3. Segments by age: The most popular segment is women aging between 15 and 30 years commonly known as generation Y, ambitious with high buying power. 4. Segments by family life: Typical college to graduate females life at home single, on their own in dorms or in their first home, either single or as a young couples without children.



AMERICAN EAGLE Market Segmentation AE can segment its market in a variety of ways. They market to males and females in their teens and early 20s. Their brand slogan is “Live your life” which communicates the ideas of living in the moment, accomplishing personal goals, making the most of experiences, and living freely. Geographic Segmentation They deliberately locate their stores in urban areas within malls or busy outdoor shopping areas. They offer online shopping as an alternative, and will deliver doorto-door or in-store. 5



Demographic Segmentation They market to teens and young adults ages 15-25. This brand is affordable to people who have low income, but wealthier customers will tend to shop here for the convenience, quality, or for infrequent bulk purchases. They focus more on marketing to women because they sell more women’s products than men’s products. Psychographic Segmentation Younger teens tend to be interested in items with the brand name displayed across the front to express they are “cool.” Customers in their young 20s usually opt for clothes that fit their lifestyles, so if they play a lot of sports they would be more interested in the workout clothing section of the store. Behavioural Segmentation There is an AE rewards card offered to customers where they can gain a point with every dollar they spend which grants them coupons and exclusive offers sent to them in the mail or by email. Their purchasing behaviour is tracked by the database to let them know about specific promotions that reflect past purchases. For example, if a customer has bought a lot of jeans in the past, a coupon for 50% off all jeans in the store may be sent to them to motivate them to enter the store TARGETING STRATEGY: Targeted marketing enables the marketing and sales teams to customize their message to the targeted group(s) of consumers in a focused manner. H&M 











The target market for H&M is for younger people. Even though H&M offers clothing and accessories for all ages, their target market is women. Women usually shop more for them, but also buy all their children's clothing. With their low prices H&M targets woman in the lower middle class and working class, this is a concentrated targeting strategy. Because their focus is to sell a fashionable product for a low price they target married to single woman, mothers and daughters. The target customers of H&M belong to the group of fashionable and trendy consumers who see shopping as a social activity provide pleasure in their daily life, who wants to follow the trends without investing a lot of money.



AMERICAN EAGLE OUTFITTERS   



The age of the target market lies between 15 to 25. It targets middle to upper class people. Its customers are mainly high schools and college going students who like wearing trendy clothes. 6



UNCONTROLLABLE VARIABLE: POSITIONING STRATEGY H&M H&M is a retailer that is looking to provide consumers with fashionable, high-quality clothing at the best price possible. They offer “fast fashion” clothing, in other words from runway to racks in record time, and sell European influenced clothing in the American market. Additionally, H&M carries clothing in a variety of categories including women’s casual, men’s business, children’s wear, footwear and accessories. The company is the second largest clothing retailer in the world, the largest in Europe and actively engages in E-retailing. H&M is also economically, socially, and environmentally sustainable. AMERICAN EAGLE OUTIFITTERS 



AEO has adopted a quality-based positioning. It focuses on the quality of the product and keeps simplified designs.  AE has taken a very real approach to their marketing and embraced the current rise of self-love, choosing a more inclusive feel. The brand is rooted in authenticity and self-expression. MARKETING MIX H&M PRODUCT: H&M is a clothing retail company. It offers fast fashion clothing for men, women and children. H&M offers following clothing brands in various countries across the globe: • H&M: The range includes everything from designer collaborations to everyday basics and yoga wear. • & Other Stories: Women wear: shoes, bags, accessories, beauty, ready to wear • Cheap Monday: Denim, fashion collections and accessories for men and women. The brand is connected with music and pop culture. • COS: Classics and wardrobe essentials for men, women and children. The brand had designs inspired by art and technology from across the world. • Monki: On-trend lifestyle collections for young women. • Weekday: It makes clothing for young and style aware young adults.



7



Various H&M Product categories PRICE:  







H&M offers high quality clothes at a premium price. The major competitors of H&M are GAP and Zara. As compared to both of these brands, H&M products are prices relatively lower as a part of it marketing mix pricing strategy. These are due to lower cost of manufacturing and transportation costs by H&M (Main focus is given on cost minimization). High quality and considerably lower prices attract the youth and hence leads to increase in sales for the company. 8



PLACE:   







H&M sells its products through its exclusive stores located in major cities across the globe (4135 stores). In some countries due to regulatory norms, H&M offers its products through franchising partners. It also offers its products through online stores from where the customer can choose from the list of available products and purchase them through online payment. Cheap Monday is sold through selected retailers worldwide and through standalone stores including its flagship store in London.



PROMOTION: Since H&M group has a wide range of product portfolio catering to different segments, it uses Multi-channel promotional strategy in its marketing mix.



9



• TV advertisements: H&M comes with creative ads which focus on its latest innovative designs. Each brand handles its own marketing decisions. The ads are telecasted at regular intervals and on channels mainly watched by youth, to increase its awareness. • YouTube: H&M has its own YouTube channel where it comes up with unique ad campaigns to engage with the customers. • Digital Marketing: It indulges in excessive search engine marketing and social media marketing to convert the potential buyers into consumers. • Promo codes and discounts: Promo codes and discounts are offered during the end of season sale. The discounts are offered on both online and retail stores. • PR: Parineeti Chopra opened the first H&M outlet in India. Such stunts generate quick publicity for the company. • Sponsorships: H&M signed deal with The Weeknd, sponsors Caitlyn Jenner, sponsors Musee Des Arts Decoratifs, Creative collaborations with high end designers and style icons, Collaborations with pop stars and sport stars.



10



PEOPLE: The employees at H&M are trained well at every level. The work culture is very modern and employees are on a rotation basis at every department and are motivated to innovate and come up with the best clothing wear. H&M also tie up with many clothing designers throughout the world to make latest trends in fashion. Employees come from diverse backgrounds having special skills. Personal and Professional development of employees is highly promoted. PROCESS: High importance is given to customer relationship management. Employees are trained to retain highly profitable customers by giving them better service and offers. In case of any complaints the staff at H&M puts in every effort to resolve them at the earliest. There is a customer care number through which the customer queries are resolved. PHYSICAL EVIDENCE: H&M stores are appropriately satisfying with great ambience and humble staff. The apparel is arranged to have a decent look which appeals to the customers. The merchandise is of excellent quality and latest trends. H&M is diversifying its portfolio and entering into more international markets. To create a Buzz in the market, it engages in PR activities. For example, celebrities were invited during its launch which created a Buzz in the market. User stories and recommendations are always welcomed by the brand which also helps in customer engagement with the brand. Hence, this completes the H&M marketing mix.



AMERICAN EAGLE PRODUCT 



American Eagle Outfitters sells its products under 5 broad categories, and each of these serves as separate product lines. The product offerings are casual clothing and accessories.







It sells unique products that are highly differentiated, with various features offered to customers that competitors don’t offer.







The product range in the marketing mix of American Eagle Outfitters includes sweater, graphic T-shirts, fleece, outwears and accessories. These products are categorised into Men’s wear, Women’s wear, Mena’s Jeans, Women Jean’s, Swimwear and Lingerie. Aries line of products include lingerie, activewear, dorm-wear and personal care products.











Its products are perceived to be of higher quality than that of competitors. Therefore, customers are willing to pay a higher price for these. 11



 



American Eagle Outfitters sells products that are famous for its traditional design that is also practical for customers to use. Its sub brands are Aerie (for lingerie such as a wide variety of bras and other undergarments, the Aerie line sells dorm wear, active apparel, loungewear, accessories and sleepwear) , Tailgate(Sportswear) .



PRICE 



  







The current pricing strategy to set the price level that American Eagle Outfitters follows is a competitive based pricing strategy as the data of competitors is easily available American Eagle Outfitters sells its products at a higher price than competitors. This is because it offers more features, and the high price makes up for these. It currently uses product bundle pricing as well, where products are bundled together and sold at prices lower than the total of individual items. It also uses an optional product pricing strategy for certain products, where it offers a price for the base product and separate prices for the accessories that come along with it. It charges a greater price for the products it sells online. This is because delivery costs have been included in the price of the product.



PLACE 











American Eagle Outfitters has retail stores located in shopping malls, lifestyle centres and street locations in USA, Canada, Mexico, China, and Hong Kong. As of 2017 AEO has over 1050 stores in these locations. In United States alone company has more than 800 stores. American Eagle Outfitters sells its products through two marketing channels. The first is where it sells directly to its customer through its online website. The second is where it sells to wholesalers who then sell to different retailers located all over the country. These then sell to its customers. It follows an intensive marketing strategy where it tries to include its products on as many retailers as possible. This ensures that its products are available to customers easily in different parts of the country. 12



 



It follows an Omni-channel distribution system where it has integrated its online and offline stores to allow customers easy access to its products. American Eagle Outfitters has a network of over 500 suppliers that provide it with the raw materials needed for production. It has developed a close working relationship with its suppliers allowing the company to work with them to innovate and introduce new and attractive features on its products.



PROMOTION 



 



American Eagle Outfitters follows 360 degree integrated marketing plan which include advertising using TV commercial, advertising on mobile phones, and using social media partners for promotion of brand. Personalisation of jeans: Inside some stores, customers can personalize their jeans by adding back patches or paint. In –store concept: some store have a study area and washing machines and dryers where students can do laundry for free. They can’t leave during the wash and dry cycles, which means some visitors stay in the store longer.



13











 



 



AEO is also experimenting with beacon technology in its retail stores to send messages to customers’ smartphones. AEO has prompted customers to try an item on in the fitting room to earn a reward. BLACK FRIDAY SALES: Unlike Black Friday sales at other retailers that feature different prices and discounts on merchandise, AEO traditionally offers a blanket discount. There's no guessing how much something costs or wondering if you're getting a great deal, you just know you're getting a discount. Mobile marketing American Eagle Outfitters is continuing its mobile-minded year by attempting to ramp up mcommerce sales with a new “offers” section within its mobile application, proving that consumers are gravitating to mobile for exclusive offers. THE AE EXPRESSION: INDIVIDUALITY. FREEDOM. DIFFERENCE. CAMPAIGNS -As a brand, AE has been a pioneer in collaborating with today’s youth to support self-expression and prioritizing their individuality with a group of inspiring Gen-Zers to help encourage others to share their unique style through their spring collection and Ne(X)t Level Jeans.”







Ride with Pride" campaign: engaged activists from the LGBTQ community, released a clothing collection to benefit an LGBT-focused organization, and launched a Facebook Live stream. It also partnered with micro-influencers and LGBTQ activists to customize #WeAllCan tees with messaging about what Pride means to them.







The brand introduced #AExME as a pledge to forgo using models and feature only real customers styling themselves in its marketing.



14







#aerieREAL, an Aerie campaign focused on girl power, body positivity and empowering women to “let the real you shine” – they even use untouched photos







American Eagle launched the #AEOLiveEXpress campaign in tandem with its ripped jeans collection launch, asking buyers to place temporary tattoos on their skin visible through the holes in the jeans.



PROCESS: 



American Eagle Outfitters has an online delivery process







American Eagle Outfitters is actively involved in researching market opportunities in order to understand customer needs. It also develops understanding regarding customer needs through feedback collected at store, its helpline or social media pages. AEO has partnered with visual search platform Slyce. As a result, shoppers will be able to point their smartphone cameras at real-world items to find similar products in its inventory as well as scan the retailer’s catalogue.







15



















American Eagle launches dressing room technology: Shoppers use touch-screens installed in each dressing room to scan items, look up product information, request additional sizes, see in-store inventory, calculate costs and email themselves product information. Sales associates receive notifications via mobile when a product is requested and can indicate when it has been fulfilled, thereby streamlining in-store logistics. Salespeople are equipped with point of sale device so the the customers can check out in the dressing room itself.



OMNICHANNEL CONCEPT: RESERVE TRY N BUY: AEO wanted to use consumers' everyday digital experiences to drive in-store traffic and purchases. The idea behind the program is to give customers the flexibility to shop exactly how, when, and where they want to. Customer reserve merchandise through a mobile app or on AEO's website. The store nearest each of those customers receives an alert AEO of the shoppers' requests and employees confirm that the items are in stock Customers reserve an average of one to two items with the Reserve, Try and Buy program. But in when they arrive in the store, customers ended up buy more than three items on average.



PEOPLE 







 







American Eagle Outfitters have people trained in persuasive techniques, but also to show respect to the business customers taking into consideration their preferences. American Eagle Outfitters has people working in its customer service department. These are contacted by customers in case of any issues within the product, and these people guide customers through the process of getting the issues resolved. These people are trained to respect the customers and try their best to get their issues resolved. American Eagle Outfitters has people working with suppliers to obtain raw materials. These people play a vital role in maintaining or improving the quality of the final product produced. American Eagle Outfitters has people working at retail stores who help the customer on site, by answering any questions or helping them decide the product that best suits their needs.



16



PHYSICAL EVIDENCE Packaging: 







American Eagle Outfitters sells its products in a distinct color packaging that easily identifiable on retail shelves. These are placed on special shelves provided by the company, which also have a distinct color and design. This makes it easier for customers to locate such shelves in busy retail stores. American Eagle Outfitters has an online website that is user-friendly and allows customers to view its products in high quality images taken from various angles.



Store layout        



A unique brand experience, feel at home, and curate their distinct individual style It has spacious lounge, with tables and sitting areas. The lounge offers plenty of places to plug in. views of the park are provided through large windows. They have iPad in the dressing room which let shoppers call an attendant if they need to edit their choices. Salespeople are equipped with point of sale device so the customers can check out in the dressing room itself. Fitting rooms have plenty of space to show off the try ones to other people. Stylised photos line in the staircase Laundry section and spot alteration facilities are also available.



BEST STRATEGIES H&M SUSTAINABILITY STRATEGY ANALYSIS 1. PROVIDE FASHION FOR CONSCIOUS CUSTOMERS Firstly, H&M upholds innovation in materials and processes to maximize the efficiency of utilizing recycled textiles and minimize the consumption of new 17



resources. However, this assertion can hardly hold the water. For one thing, the proportion of recycled materials in production is extremely low. For another, this emphasis on material innovation may divert the public attention from more thorny issues regarding its overproduction and labour right issues. Next, the launch of the conscious collection is regarded as an enabler by H&M to advocate the idea of sustainability among its target customers. In addition, it has embraced the initiative of collecting used clothes back to the supply chain.



2. CHOOSE AND REWARD RESPONSIBLE PARTNERS In terms of supply chain management, H&M audits the performance of suppliers by referring to its ‘Full Audit Programme’ and external independent agencies. Besides, it benchmarks the suppliers’ sustainability performance with its Index Code of Conduct (ICoC) to ensure the good practice of suppliers. With regard to wages, H&M has formed a roadmap to promote Fair Living Wage which will not only enable the workers to cover the basic needs, but other necessary expenses. In order to monitor the progress, some external agencies such as Fair Wage Network are invited to participate this process. 3. BE CLIMATE SMART H&M aims to improve the efficiency of electricity usage in stores, and use electricity that is produced with renewable resources in order to scale down the greenhouse gas emissions. Moreover, it initiated a range of campaigns to involve its suppliers, second-tier suppliers, transport providers and customers to contribute to greener practices.



18



4. REDUCE, REUSE, RECYCLE To begin with, H&M has teamed up with I:Collect (I:Co) to collect unwanted clothes with the in-store collection boxes. These recycled clothes will be either be reused or be incorporated in the production. Besides, it is funding the innovation to improve the efficiency to create the closed-loop. Moreover, it asserts to recycle the waste produced in warehouses and stores to reduce environmental footprints.



Latest strategies that H&M are marketing to its consumer are through a mobile marketing campaign to promote the latest collection. In doing this mobile marketing strategy consumers receive SMS coupons, mobile banner ads placed on major portals and media sites. This campaign was geared toward consumers in Sweden. H&M launched their first campaign in 2006 and is still continuing to use this channel to cover a wide range of consumers. The main goal for this marketing technique is to promote the latest seasonal trends for that particular season and to drive membership of the H&M Club. 5. To help gain customer traffic in the store H&M has also used celebrities such as Karl Lagerfeld, Roberto Cavalli, Rei Kawakubo, and Jimmy Choo to help increase sales. 6. One of the major ad topics that H&M may market is the Fashion Against Aids campaign. The specific collection featured t-shirts, tank tops, and hooded sweaters designed by Designers Against AIDS(DAA) and by several music artists including Rihanna, Timbaland, and Ziggy Marley. Nearly25% of the sales from this collection went to HIV/AIDS prevention projects.



19



7. Also, H&M collaborated with Stella McCartney to help add style to the collections. With the introduction of these major stylists, H&M wanted to increase their market share especially in the English market.



8. Focused initially on 1st and 2nd tier cities but expanded into 3rd and 4th tier cities when experience with the market grew. 9. Entered after China's WTO accession: The timing was good as the economy grew rapidly after the WTO accession. Thus, the strategic choice of timing was well planned. 10. Social media presence - As you’d expect for a fashion brand with customers around the world, H&M has large social media audiences. It has 37M likes on Face book, more than 33M followers on Instagram and 8.4m on Twitter. In the case of Twitter, it has plenty of country-specific accounts, which allows the brand to produce content specific to its different audiences



20



AMERICAN EAGLE OUTFITTERS  The retailer shifted from simple logo bearing brand to innovative brand.  It Strengthened its core product category with more innovation in distinct finishes, fabrics and washes.  American eagle simplified its designing system to respond to changing customer tastes quickly and effectively.  It removed layers within its design teams, reorganized the structure to implement direct accountability and enhanced its speed sourcing capabilities.  Adopted fast-track fashion, in which merchandise moves from design to in-store receiving in just 60 days. 



AEO has taken an extra step towards inclusivity, officially making a denim hijab part of its wardrobe offerings. The company recently made waves with their new ads, which debuted on Instagram and were totally unretouched. They also featured Muslim model Halima Aden wearing a hijab with her awesome layered look for fall.







INVENTORY MANAGEMENT STRATEGY: American Eagle is also avoiding this common downfall in the industry by making an effort to eliminate excess inventory. strategy in which it stocks very little and updates its collections frequently. Instead of other brands that only update once a season, it restocks with new designs twice. STEPS TOWARDS SUSTAINABILITY AEO exercises a triple bottom line approach, and therefore puts forth a tremendous amount of effort in being a socially responsible corporation. AEO partnered with I:CO to construct a zero-waste textile initiative for their associates. The I:CO program prevents 22.3 billion pounds of clothing and other textiles from reaching our landfills each year in the U.S They recycle everything from paper to glass, plastics and cardboard The shopping bags using 75% recycled materials It worked to reduce water use per jean production by 30%, recycle 50% of total water used in denim laundries, and make sure the factories, mills, and laundries we use uphold our wastewater standards. It uses 100% of cotton fiber from growers using sustainable farming techniques, and making sure at least 50% of our polyester fiber is sustainable. Converted all labels to sustainably sourced materials, and are sending you home with shopping bags made with higher recycled content American Eagle does not use fur, angora, down or exotic animal hair or skins.



      



  



21







At the end of the day, American Eagle follows a fast fashion model, promoting quantity over quality, which is inherently unsustainable. FAILURES AND CONTROVERSIES H&M WORST STRATEGIES 



H&M Scandal- "Coolest Monkey in the Jungle" advertisement. In the first week of January 2018, H&M UK created a worldwide controversy by advertising a green hoodie with the slogan “Coolest Monkey in the Jungle” in its online store featured by a black boy model while a white child model was presenting an orange sweatshirt saying “Mangrove Jungle – Official Survival Expert”. Immediately, the company was faced with an outcry on social media criticizing the advertisement as being racist, offensive, derogatory and negligent. Furthermore, the company was criticized for showing a serious lack of social awareness and racial sensitivity.



 



MALL STRATEGY FAIL Upon landing on US shores in 2000 with the opening of its NYC Fifth Avenue flagship store, H&M followed a largely indiscriminate real-estate strategy heavily weighted toward malls with over 80% of its stores located in such, according to an analysis by real-estate services firm JLL. With some 536 U.S. stores, H&M faces off with against the other failing mallbased fashion retailers. PROBLEMS H&M FACED DUE TO ITS STRATEGIES: H&M WAS SLOW TO SELL ONLINE H&M’s strategy has been heavily focused on its store outlets, and this is understandable given the success the brand has enjoyed. However, it’s arguable that this focus meant that H&M was too slow to see the potential of ecommerce. H&M only started selling online in 2010, a decade after ASOS appeared. It seems that the retailer was slow to see the opportunity that ecommerce presented, or else thought that its store network was enough to see off online competition.



  



22







   























The sites were poorly designed too, with many usability flaws which made it harder to drive sales from the site. It has improved since, but the H&M site was deeply flawed in the first years after launch. USER EXPERIENCE NEEDS SOME IMPROVEMENT Fashion sites have worked hard on usability over the past few years, and many sites offer an excellent user experience, on mobile and desktop. H&M’s mobile site is usable, but there are a few areas for improvement. For example, the navigation is sometimes confusing. Information on product pages can be relatively sparse. Previously, clicking on the delivery and payment link brought up this message. People will be expecting some detail on delivery costs and timescales, as this impacts on their decision to buy or not. This doesn’t help at all, and customers have to add items to their basket before finding out costs and options. LACK OF SEO STRATEGY IN THE PAST H&M’s SEO strategy seems to have been non-existent at times, and it had made some serious errors which have impacted its performance in the search engines. H&M does seem to be using social more as a broadcast than an engagement channel. This is not necessarily a problem for it, though some brands prefer to present a lighter more playful side on social channels. DELIVERY COSTS Free delivery helps to drive sales, but impacts on profit margins mean retailers need to decide which tactics to adopt here. H&M has clearly decided that covering costs is more important, and its delivery costs may deter some customers. It charges £3.99 for standard delivery, which is more than some competitors. ASOS, for example, will deliver free of charge when shoppers spend more than £25, a good way to drive up basket values. When rival fast-fashion retailers like Zalando are offering free delivery and returns, H&M’s delivery offering will lack appeal for many price-conscious shoppers.



AMERICAN EAGLE BRAND FAILURES • In 2013, It could not keep pace with the fierce competition from fashion-forward brands hence missed fashion calls. • It produced basic merchandise with persistence logo business. • It could not meet the changing consumer needs and behavior. • The retailer’s comparable store sales declined by 6% • Early last year, American Eagle terminated its licensing agreements in China and Hong Kong.  Brand Failure in UK: American Eagle is one of a large number of retailers populating the US market that offer casual, outdoorsy clothing, where the average British customer is much less casual. Also UK clothing sector is a over supplied industry.



23



 



The stores failed because AEO did not have any unique thing to offer and its price was comparatively higher for UK customers. Was positioned as premium brand in UK.



Failure of two sub brands: MARTIN+OSA and 77 KIDS 



MARTIN+OSA: The mall-based chain also had competition from department and specialty stores.



In fiscal 2009, it generated an after-tax loss of $44 million, including a non-cash impairment charge of $11 million, net of tax. 



77KIDS: 77kids had a loss after taxes of roughly $24 million on sales of $40 million in the 2011 fiscal year.



UNIQLO GENERAL BRAND OVERVIEW EPRG FRAMEWORK 



Ethnocentrism: operated in Japan until 2001.







Polycentric: Entered into London in 2001 and Shanghai in 2002







Geocentric: UNIQLO has a geocentric orientation. The reasons for this are: the company recognizes the regional commonalities and undertakes regional strategies by considering the entire world as a potential market, ignoring national boundaries. The firm develops policies and organizes activities on a regional or worldwide basis. Firm designs product lines, pricing decisions, promotions and the channels of distribution for worldwide markets For these reasons, UNIQLO following this orientation can be described as a global company.



SEGMENTATION, TARGETING AND POSITIONING SEGMENTATION: The brand philosophy “Made for All” positions its clothing to



transcend age, gender, ethnicity and all other ways to define people. The basic strategy behind Uniqlo is mass appeal.   



Geographic Segmentation: Urban and suburban categories. Demographic segmentation: it targets all the age categories and both the genders. Geographic Segmentation



Uniqlo is also using geographic segmentation which is dividing the market based on the different regions. They provide HEATTECH products which are appropriate for the freeze and cool regions. The HEATTECH clothes can make the customers stay warm and feel comfortable. Besides that, the AIRism products which also provide by Uniqlo are suitable to the hot and warm season. 24







Psychographic Segmentation



Uniqlo also provides their products to the customers who are young, stylish and trendy. They also cater to customers with a freestyle attitude and casual lifestyle. TARGETING: Uniqlo apparels are not only limited to higher income people. The main target market Uniqlo is the male and female adults that are ranging from the age 18 to 40 and are looking for affordable and high-quality clothing that fits their lifestyles. POSITIONING: Uniqlo’s brand message encapsulates a clear vision: “Uniqlo is a modern Japanese company that inspires the world to dress casual”. The corporate strategy that has worked for Uniqlo so far is to “totally ignore fashion” instead of chasing fast-fashion trends like its other competitors. The brand philosophy “Made for All” positions its clothing to transcend age, gender, ethnicity and all other ways to define people. Contrary to its name “Uniqlo”, its clothes are simple, essential yet universal, enabling the wearers to blend them with their individualistic style. EXISTING MARKETING MIX



PRODUCT: Tadashi Yanai is fond of saying that “Uniqlo is not a fashion company, it’s a technology company.” The Product Range includes: 



Men & Women: Outerwear, Ultra-Light Bottom Collection, Sweaters, Fleece, Casual Shirts, Blazers, Dress, Shirts, Customized Easy Care Shirts, Sweatshirts, Sweatpants, T-Shirts and Polos, Graphic Tees, Warm-Lined Pants, Jeans, Pants, Uniqlo Sportswear, Innerwear, Chino Pants, Underwear, Socks, Loungewear, Accessories and Shoes







Boys & Girls: Outerwear, Sweatpants, Sweatshirts, T-Shirts, Tops, Graphic Tees, Pants, Shorts, Uniqlo Sportswear, Innerwear, Loungewear, Accessories, Fleece







Baby: Toddler collection consists of Outerwear, T-Shirts, Tops, Pants, Innerwear, Pajamas, Fleece. Newborn collection consists of Outerwear, Tops, Newborn Fleece, OnePieces, Bodysuits, Innerwear and Accessories, Socks



INNOVATIVE PRODUCTS: 



HEATTECH: One of Uniqlo’s signature innovations is HeatTech, a fabric developed in conjunction with Toray Industries (a Japanese chemical company) that turns moisture into heat and has air pockets in the fabric to retain that heat. The HeatTech fabric is thin, comfortable which has enabled the brand to create stylish designs which are very different from the standard traditional warmth clothing segment. The 25



HeatTech innovation keeps improving over time with new fiber technology, allowing the brand to come up with different collections of thermal clothing.







AIRISM: Airism innerwear provides comfort to users by regulating the clothing microclimate, which is a small layer of air stream between the garment and their skin. To deliver this, the men’s AIRism line is made from Toray’s fine polyester fibers that allow the fabric to wick away perspiration quickly, be breathable, and provide a smooth and cool contact feel.







ULTRA-LIGHT DOWN: Ultra Light Down is so light that each of them can be lifted by a balloon. Unlike traditional down jackets which are thick and heavy, Ultra Light Down jackets are feather-light and compact while delivering warmth. This is because Ultra Light Down items feature a shell made from strong and fine nylon yarns that are developed by Toray. With each nylon yarn being approximately one-tenth the thickness of a single strand of human hair, the shell of those jackets can be thin and light. However, the shell is also durable and flexible as the yarn is made from multiple fine fibers that are woven together.



SUSTAINABILE PRODUCTS: Uniqlo has taken an initiative called “All-product Recycling initiative” where the customers are encouraged to recycle the clothes and use them for textile industry material. 



UPCYCLING PROJECT: UNIQLO is carrying out its Upcycling Project in an effort to turn scrap materials into valuable items by reusing and recycling them. an initiative has been introduced to give formerly homeless people and refugees the opportunity to make tote bags and other accessories using denim scraps left over from alterations of jeans at local UNIQLO stores. 26







SUSTAINABLE DENIMS: In November 2016, FR opened the Jeans Innovation Center as a denim research and development facility in Los Angeles, which is widely regarded as the denim capital of the world. The center creates designs with an emphasis on quality, while reducing environmental impacts during manufacturing and pursuing safe and efficient operations. An example of one of its innovations is the production of prefaded and pre-ripped jeans. Large amounts of water and chemicals for fading the denim along with manual labor to make the tears and rips are generally required when producing such jeans. By adopting a laser process and other cutting-edge technologies, the Jeans Innovation Center aims to shorten manual processes and greatly reduce chemicals, water and waste.



Uniqlo makes Sustainable denims using eco-stones and laser technology. PLACE: In Asia, it is the biggest apparel chain with close to 800-900 stores. There are nearly 900 Uniqlos in Japan, compared to about 2,400 Gaps in America. That means there are more than 1/3 the number of Uniqlos in a country that is roughly 3% the size The United States. The company currently operates 1920 stores throughout the world. The company currently operates 1920 stores throughout the world. Some of the countries of operation are Australia, Canada, China, France, Germany, Hong Kong, Macau, Indonesia, Japan, Korea, Malaysia, Philippines, Russia, Singapore, Spain, Taiwan, Thailand, UK etc. OVERSEAS DEVELOPMENT: UNIQLO also believes that aggressive development of an international store network is another key to growth. 



UNIQLO’s entry into overseas markets began with the opening of a store in London, in September 2001, and in Shanghai, in September 2002, which was followed by the commencement of store operations in the United States, Hong Kong, and South Korea in autumn 2005.



27



 











In Shanghai also, UNIQLO adopted a “scrap-and-build” approach to add to its overseas experience. Factors contributing to the Hong Kong store’s success were its large sales floor area of nearly 1,000 square meters and a wide selection of merchandise, combined with an active, broadly based publicity campaign FLAGSHIP STORES: Uniqlo understood that the basis for brand awareness is retail stores, UNIQLO decided to launch a “global flagship store.” On November 10, 2006, UNIQLO opened a global flagship store in the Soho district of New York, with sales floor area of 3,300 square meters. The Soho store is located right on Broadway, New York’s bestknown fashionable district, and is therefore not only well positioned to showcase the best products, shop floor, and service that UNIQLO can create but also transmit the latest in Japanese culture-centered around the concept “From Tokyo to New York.” LARGE-FORMAT STORES: To develop products suited for sales in these more spacious stores will enable us to expand our customer base. Customers will have a choice of more fashion-conscious merchandise



Largest Uniqlo store in Ginza PRICE: The pricing is competitive and they differentiate themselves from the competition through unique simple designs and bright colours. They sale selected products at promotional prices which are generally $5-$10 less compared to the retail prices. Uniqlo also provide free shipping on all orders. 



In 2014, due to prolonged deflationary condition in the Japanese economy and an increase in sales tax by the government, Uniqlo had taken an inflated pricing strategy. The management of Uniqlo took such business measure to counter the rising production cost as well as improving the revenue earning capacity and overall profit levels of the company.



PROMOTION: UNIQLO uses multiple media channels to promote its products. It uses traditional media, which includes an advertisement on television and radio. This is beneficial 28



due to its large reach and ability to attract a large number of people. It uses online and social media advertising, which is cheaper and beneficial due to the increasing usage of the internet.  



It sends periodic SMS to its regular customers informing them about new deals and new products. IN-STORE ENVIRONMENT: One of Uniqlo’s main brand communication methods is its in-store environment. Through its wide aisles, bright lights, neatly stacked shelves and beautifully presented displays creating a comfortable and welcoming shopping experience, Uniqlo communicates its ideal of simplicity and essential basics. Inside the stores, Uniqlo has a number of digital in-store experiences explaining the benefits of the apparel and fabrics and this strategy has helped communicate the brand philosophy very well. Compared to other fast fashion competitors whose stores are jampacked with clothes, lack order and do not have a specific focus on customer service, Uniqlo’s in-store experience stands out and contributes heavily to effective communication of its brand philosophy.



Neatly stacked and color coordinated shelves 



CELEBRITY BRAND ENDORSEMENTS: For Uniqlo, the most important attributes it looks for in its brand ambassadors are great resilience and strong character to overcome adversity. Uniqlo currently has 6 Global Ambassadors:







Japanese international snowboarder Ayumu Hirano







Swiss professional tennis champion Roger Federer







Japanese global tennis medalist Kei Nishikori







Japanese international wheelchair tennis champion Shingo Kunieda







Scottish international wheelchair tennis champion Gordon Reid







Australian world-class pro golfer Adam Scott



29







DIGITAL MARKETING: Being one of the first brands to successfully launch the digital marketing campaign ‘Uniqlock’ back in 2007, Uniqlo is definitely one of the forerunners to use this brand communication channel. The web tool, Uniqlock, was designed to include a blog widget so the clock could be embedded into blog sites. By January 2008, more than 27,000 widgets from 76 countries were circulating, and the widgets and website that accompanied the campaign had been viewed 68 million times in 209 different countries. Uniqlock won the brand a multitude of major advertising awards, including a Grand Prix at Cannes Lions Festival.



PEOPLE: In terms of company culture, the organizational structure is well known to be flat with employees greatly encouraged to provide suggestions. The values and goals of the company are translated directly into processes and measures exhibited strongly by employees all over the world. Company financials are completely transparent to employees and sales and charted and posted daily. The brand also places a huge emphasis on its retail store experience and micromanages every customer touch point. Staff training is a huge priority for the company as each new employee is trained for a remarkable 3 months – way above global industry average. Every activity undertaken by its employees are recorded and analyzed – from apparel folding technique, to the way retail staff returns credit cards to customers with both hands and full eye contact. Employees are also taught to interact with shoppers using six standard phrases including “Did you find everything you were looking for?” and all customers are welcomed with “Welcome to Uniqlo!”. The company is currently building a Uniqlo University in Tokyo in which 1,500 new store managers will be trained every year.



30



PROCESS: UNIQLO to make sure that its products are always available at retail stores has systems installed where retailers can notify when their inventory levels are low. UNIQLO provides them with more products while ordering its productions to replenish its stock. This ensures that products are always available to customers when needed. 







UNIQLO has an online delivery process, where orders are received in the computer system and based on these orders, the relevant product from the inventory is shipped to the delivery service provider. UNIQLO is actively involved in researching market opportunities in order to understand customer needs. It also develops understanding regarding customer needs through feedback collected at store, its helpline or social media pages.



PHYSICAL EVIDENCE: UNIQLO sells its products in a distinct colour packaging that easily identifiable on retail shelves. These are placed on special shelves provided by the company, which also have a distinct colour and design. This makes it easier for customers to locate such shelves in busy retail stores. BEST BUSINESS STRATEGIES: 



















SPA MODEL OF BUSINESS: In 1998, after Uniqlo completed its ABC reform, it gradually began to adopt its unique SPA business model. SPA is a vertically integrated business model that integrates product development, design, manufacturing, logistics and sales together. They deliberately make clothes that aren’t that special. The Japanese clothes look identical on runways and in real life and in order to buy them, you don’t need an image consultant. Uniqlo makes non-trendy clothes on purpose and they are proud of it. They rely on cheaper products in order to make their customers feel as if they are saving money. The brand decided to fight against the competitors with their low prices,35% of the products at Uniqlo are sold for less than $10. By today’s standards that’s not just cheap — it’s almost free. They create the illusion of a wide choice. All the clothes from the brand are produced in dozens of colour variations. For example, they make polo shirts in 80 different colours. In summer, they sell winter clothes, and vice versa in winter. This approach attracts more practical customers that prefer to prepare for a different season in advance



31











In their stores, it is almost impossible to find shoes. The categories which Uniqlo invests in is incredibly interesting too. There is very little emphasis on footwear, which is unusual for a retailer of this size. Uniqlo gives more attention to hosiery and underwear, which accounts for 13% of its assortment. That outstrips most of the market – at both H&M and Target it’s 6.0%, at Walmart 3.6%, Macy’s 3.0% and Zara just 1.8%. They offer technology instead of fashion to make their customers feel smart. No other brand was producing affordable clothing specifically for millennials. Uniqlo is partially clothes for geeks: because even for the simplest clothing, they use innovative technologies. Instead of wasting money on an army of designers, the brand hires scientists that develop ultra-light, thin, or warm fabrics.



ENTRY MODE ANALYSIS FOR UNIQLO IN THE UAE PESTEL ANALYSIS OF UAE 











Political: The United Arab Emirates (UAE) comprises of seven free Emirates. Each of the seven emirate rulers is an individual from the Supreme Council, which is the gathering that makes national approach. The stable government structures and favourable trade policies makes UAE the perfect destination for apparel retailers. In order to become the largest manufacturer and exporter of readymade garments the government has established Dubai Design and Fashion Council. At present the country enjoys free trade zones with Japan, China, India, Pakistan, Australia, New Zealand, Korea, Brazil, Argentina, Uruguay, and the European Union. UAE government has made it clear for global apparel retailers about how to enter their market. According to the government policies the brand has to collaborate with a local brand or sponsor in order to open store. Policies also specifies that the trade licence needs to be renewed every year and it is only valid in the particular emirate. Economical: The UAE is rich in oil and gas assets. The economy of the UAE has extended strongly over the previous decade. The UAE is positioned third on the planet regarding normal salary, after Luxembourg and Norway and that is the reason why there is a huge consumption of luxury clothing. The open economy system attracts manufacturers and retailers to open their establishments in UAE. The country also provides infrastructure and monetary help in establishing the brand, lack of restrictions on taxes and cheap labour cost. Social: The United Arab Emirates is a federal constitutional monarchy. UAE is an Islamic country and like Saudi Arabia it also follows Sharia Law. The social laws in UAE are very strict for both men and women. The laws on women are very tight they are deprived of lot of civil rights. The women have strict dress 32



codes, they are not allowed to wear western clothes, they are not allowed to drive and many more. But nowadays the girls are getting enrolled in top universities and women are also given the basic rights.



 Technology: UAE has a standout amongst the most developed telecom arranges on the planet. There are more than 6 million cellular telephone accounts. Its administrations incorporate Internet get to, LAN and WAN systems, prepaid telephone administration, cell telephone administration, HQ TV, and nearby information transfers. The government has started ecommerce business also to facilitate the global brands. The UAE’s managing an account area is satisfactorily resourced to manage worldwide and residential anxiety situations and has taken care of late worldwide monetary turmoil relatively well. Banks’ noteworthy capital ampleness levels, together with hearty provisioning strategies and acceptable gainfulness, it expressed, upgraded their ability to adapt to real difficulties. All significant Mastercards are accessible and acknowledged in the UAE and the most widely recognized are Visa and MasterCard.



 Environmental: UAE appreciates a blended primary land condition. UAE falls in a dry region stretching out from crosswise over Asia and North Africa, and it is additionally subject to the same local climatic conditions on the bank of the Arabian Gulf and the Gulf of Oman. The nation experiences downpours shortage simply like alternate nations in the dry district. Similarly, the measure of precipitation in the nation differs from year to year, as likewise the rate of its raining shifts starting with one locale then onto the next.



 Legal: At present, the elected arrangement of government incorporates the







 



 



Supreme Council, the Council of Ministers (Cabinet), a parliamentary body as the Federal National Council (FNC) and the Federal Supreme Court, which is illustrative of an autonomous legal. The Supreme Council chooses a president and VP from amongst them to serve for a renewable five-year term in office. SOME LEGAL RESTRICTIONS FOR ADVERTISEMENTS IN THE UAE Beverages/Alcohol: The Advertising Standards explicitly prohibit all forms of advertising for alcoholic beverages for the general public. Advertising in the specialised regional press and in publications that are only directed at professionals as well as promotion booklets in sales outlets are tolerated. Cigarettes Pharmaceuticals/Drugs: All forms of pharmaceutical advertising need prior approval by the Ministry of Health. It bans, all promotional material that may contradict UAE customs and traditions as well as Islamic principles or that are addressed to minors. The Regulation does not make a distinction between prescription and over-the-counter medicine Other Rules: Advertising content must not offend UAE customs and traditions as well as Islamic principles or contain words and images that breach public morals. Use of Foreign Languages in Advertisement: Advertisements both in English and Arabic are quite common owing to the multicultural composition of the



33



country. While English-only advertising is acceptable, promotional materials in both language prove to be more successful. CONSUMER BEHAVIOUR STUDY 



















CONSUMER PROFILE: In 2017, the total population was 9.4 million people - of which only 30% were women. The majority of Emiratis fall under the 15-64 age range, with men aged 30 to 49 being the most prominent. PURCHASING POWER: GDP per capita has been fluctuating for decades in the UAE. According to the latest available data by the World Bank, GDP per capita increased from USD 38,517 in 2016 to USD 40,698 in 2017. Salaries differ among the seven federal emirates, but the average salary in the biggest emirates - Dubai and Abu Dhabi - is around USD 33,400, while disposable personal income is USD 13,500. Emiratis spends around 30% of their monthly salaries on luxury goods. BUYING BEHAVIOUR: UAE consumers are most diverse across the Mid-East Countries. Consumers in the Middle East have a changing buying behavior. They are less brands loyal and more demanding. They expect more convenience, more healthoriented options. They want to feel exclusive. 34% of consumers buy their favourite brands no matter the cost. That also means consumers have high expectations that can be hard to meet. They expect excellent customer experience and personalised service. For online shopping, they prefer single-brand websites because buyers believe they provide the best customer service.



Distribution of Population by Age Bracket



SUGESSTED SEGMENTATION, TARGETING AND POSITIONING SEGMENTATION: DEMOGRAPHIC: According to demographic segmentation, the market can be broken down into groups by income. Since Uniqlo products are cheaper yet value based, their target market includes people form middle income group to higher income. The customers from the age 1835 can be the best market for Uniqlo. As there are people from around the globe working in the UAE, there is a huge pool of customers in the working class who can be the potential customers for Uniqlo. The college going students in the country can also be the potential customers.



34



BEHAVIOURIAL: Emiratis are highly influenced by the social concerns. They tend usually to buy the things that recommend by their circle of friends and family while putting fewer efforts on exploring the specific features of a product. The regional consumer tend to buy products to gain a higher social class appearance. 75% of customers in the Middle East prefer shopping from a single brand website (as opposed to a multi-branded one) because they believe it will provide the best possible customer experience. UAE consumers are big spenders. They’ll happily open their wallets for their favourite brands, with 34% saying they’d buy from them at any price point. The Emiratis look for the products that sets them apart from the others, they look for differentiation through the clothes they wear. TARGETING: Uniqlo have clear understanding demands of their customers. Uniqlo apparels are not only limited to higher income people. The main target market Uniqlo should be the male and female adults ranging from the age 18 to 35 and are looking for high-quality clothing that fits their lifestyles. This mainly includes the people from the working class who form a huge proportion of the UAE’s population. The renowned colleges from around the world have opened their centres in UAE. Thus there is a large number of college going students from around the world who are looking quality casual clothing, they can be the potential targets for Uniqlo.



POSITIONING: Uniqlo’s brand message encapsulates a clear vision: “Uniqlo is a modern Japanese company that inspires the world to dress casual”. Maintaining a certain social image is a quiet big concern which highly affects the consumer habits in the region. As the customers in UAE are looking for class with quality, the brand should position itself as a casual yet classy brand. The brand has to project itself as luxurious so as to compete with the big brands in the UAE market and to target the customer’s mindset for luxury and differentiation. The brand should be projected to provide value for money and luxury at the same time The company should follow the brand ethics, it should be projected as a brand that treats the customers with high regards. The customers in UAE want to receive excellent service and feel valued by the brand. Uniqlo should build a campaign that will make the brand stand out in the market and always deliver their USPs in straight forward and easily consumed ways. It should 35



follow the “Blue Ocean strategy” where it needs to focus on how to brand its product. In other words, it is not quality concern, it is differentiation. It should emphasize more on in-store service and convenience. So, if Uniqlo wants customers to connect with their brand in the UAE, it has to make sure that its CRM is effective and highly personalized. SUGESSTED MARKETING MIX PRODUCT: Uniqlo need to design ranges that allow people to express their individual identity in a way that still embraces and celebrates heritage and tradition. It should offer more fashion forward styles and designs. They need to focus on how to differentiate their product. As the Middle east customers look for exclusive stores and are least quality concerned as compared to UK or US. These are some of the suggested product strategies that must be followed by the brand: i.



Contemporised Abaya and Kaftan: Uniqlo deals with Casualwear. It can develop a collection of Abaya and Kaftan for women long sleek outerwear. Modern prints, detailings and styles, can also provide a choice of wearing belts around it. The materials can be lightweight and flowy for regular use such as cotton, jersey etc. to make it suitable for regular as well as evening wear.



ii.



Work wear Collection: It should infuse the technology of AIRism and Dry Ex in the workwear collection of both men and women. It will help the people to be 36



comfortable all day long. It should eliminate the Heat-tech Collection, which is a clothing technology to generate heat from your body and keep you warm. iii.



Customisation of prints: It has collection of Graphic T- Shirts , Neo – Miyage , where the prints depict the Japanese Culture and Calligraphy. It can change the prints according to the taste of customers so that they can connect with the brand more easily.



Neo-Miyage print



Customised Print



PRICE: To maintain mid-premium pricing strategy. Because it has to build a certain image to maintain their brand image as the consumers are mode brand conscious. It should adopt a skimming pricing for the AIRism, UV protection and Dry Ex clothing collection. It will help build a high-quality image and perception of the product and hence be in great demand.



PLACE: The store should be located at the city centres; Eg: malls or a free zone. The shopping mall is somewhere people spend their days during the hot, humid climates seven months out of the year. Hence it will remain prominent in UAE . It can open its stores in major malls like; Marinna Mall, Dubai Mall, Al Wahda Mall, Wafi Mall. It can open a free-standing store on the two major series of highways in Dubai, which are "E" and "D".



37



Location around Marina Mall. PROMOTION:  



  



 



Great opportunities for marketers to use social media and content marketing as 90% of the population having access to the internet. UAE is known for highest number of bloggers. So, they should feature the bloggers and local models in their ad campaigns. Eg models like Cynthia, Alexandra P. Personalized interactions with the use of WhatsApp Chatbots and SMS marketing. Influencer marketing; influence the customers with a celebrity or opinion leader or media advocate. Consumer connect with the promotion campaign more than with the product itself. They have higher awareness about the piece of the advertising than the product name. So, the campaigns should be effective and deliver a strong message. Showing less skin and use culturally appropriate images in the campaigns and combine technology and social codes together. Recruitment of local staff in the stores.



Alexandra P.



Cynthia 38



PEOPLE: Staff training is a huge priority for the company as each new employee is trained for a remarkable 3 months – way above global industry average. The store should have employees who can provide services in Japanese, English, Korean, Chinese, French and Spanish as well as Arabic. Uniqlo should hire more of local people of UAE as their Employees so that exchange of communication can be better & they should also taught to interact with shoppers using six standard phrases including “Did you find everything you were looking for?” and all customers are welcomed with “Welcome to Uniqlo!” in their national language. It should introduce the courtesy policy, which recommends the store personnel wearing ‘respectful clothing’ in addition to other policies, for the comfort and safety of all guests. It should have a courtesy dress code– and the clothes must not be very revealing. PHYSICAL EVIDENCE: Uniqlo should focuses on customer’s experience, when they see or use a service, and which contribute to the perceived quality of the service. Firstly, For UAE market for new store, Uniqlo should collaborate with local/global architects who understand the architectural point of view of the UAE, the aim of the store design should be in a way that, it brings a unique and elegant customer experience with an incredible space. Spacious stores will enable to expand their customer base. Broadening the merchandise mix will encourage more potential customers to shop in UNIQLO. There should be a sophisticated concept behind the in-store environment, through carefully selected classic, confident, and minimalistic elements with interesting details as per the taste and style of the local customers. The layout should be created for the optimal customer experience and the best shopping journey focussing on zones of product accessibility, inspiration, and openness. The store design should be in such a way that it aligned with the brand’s core values like affordable luxury and timeless style. Uniqlo should provide some exclusive services like AEO lounges: for its premium members to give them feel of prestige that they can relate to their needs and that will help grow the company’s prestige too. The people of UAE are fond of nice smelling fragrances, so the stores ambience should feel the same. They should put sweet smelling blend in the vents. The women section along with the woman trial rooms should be separated from the men section for privacy allowance. These practices are based on cultural beliefs which the brand need to follow. UAE market experience global consumerism, majority from its own place for which Uniqlo should brief every description about the product or the services at the store in Arabic and English language. It will help both the local customer as well as the foreign customer. 39



PROCESS: No major changes in process as the UAE supports both online delivery and retail stores. It should monitor consumer behaviour, do post purchase evaluation and collect periodic feedback to improve their experience. SUGGESTED ENTRY MODE FOR UNIQLO IN THE UAE



Due to the governmental policies of the UAE, Uniqlo must collaborate with local brands or sponsors. Majid al Futtaim and Al Tayyar Insignia are two such companies who have opened the doors of the UAE market to many global brands through Joint Ventures. Hence, it can be suggested that Uniqlo collaborate with such companies to enter into the UAE market. Majid Al Futtaim is an Emirati Holding Company based in Dubai, operates shopping malls, retail, and leisure establishments in the Middle east and North Africa with operations in 13 countries. Majid Al Futtaim Properties develops, owns and manages shopping malls and hotels throughout the MENA region. Majid Al Futtaim Fashion provides a platform for the introduction of world-class fashion and retail brands in the region, developing their presence across the Middle East. The leading retail arm of Majid Al Futtaim Ventures, Majid Al Futtaim Fashion has the rights to operate the internationally renowned Juicy Couture brand throughout the region. The operation of its competitors, H&M and AEO are both managed by another such franchising and holding company named M.H. Alshaya . CONCLUSION: After the detailed study of Uniqlo’s general marketing strategy, vision and mission statement and taking into account the PESTLE analysis of the UAE, new marketing strategies have been suggested keeping in mind the UAE market. The suggested entry mode for Uniqlo has also been suggested in line with the political framework of the region.



40



REFERENCE    



https://brightside.me/creativity-design/9-uniqlo-marketing-secrets-that-even-make-menwant-to-shop-794280/ http://gdruk.com/many-faces-one-brand-uniqlo-fits-different-markets/ https://www.mbaskool.com/marketing-mix/products/17655-uniqlo.html https://www.marketing91.com/marketing-strategy-of-uniqlo/



41