Case discussion 2 - Uniqlo

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Simon Fraser University *

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Marketing

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Feb 20, 2024

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Uniqlo – Case discussion (March, 2020) Parent company – Fast retailing Breakthrough collaboration brand - +J First collaboration with Jil Sander in 2008: - Changed the brand image from unfashionable to fashionable - Led to increase in sales for women clothing - Women clothing increased from 24.8% of total sales in 2008 to 46.8% in 2011 - This exceeding men’s clothing which was at 43.3% They ranked third after Zara and H&M and by 2018, their growth had declined by from 18% to 8% whereas Zara and H&M increased - H&M almost doubled from 5.2% to 10.6% - Zara increased from 4% to 6.5% - Uniqlo went from 14.4% to 7.5% Therefore, Katsuta (Senior VP of R&D) wanted to relaunch +J The covid-19 pandemic’s effects on the fashion industry in 2020 - People were staying at home so the demand for new clothes & shoes declined Uniqlo: Aggressive expansion in 2020 - Uniqlo opened its largest global flagship store in Ginza, Tokyo (same month when Zara announced massive closures - Early 2020, Uniqlo opened more large format stores in urban areas of Japan - Consumer’s demand for simple, comfortable, stay at home clothing and their LifeWear (from 2013) concept would cater to this need during covid ADVANTAGE DURING COVID Uniqlo: History and brand image in Japan - Help yourself model taken from GAP – let people choose clothes without help from the sales assistants. - First store in Hiroshima, 1984 and exceeded 300 stores by 1997 in suburbs - Simple designs at discounted price worked very well – ads focused on affordable pricing - Mainly targeted middle aged men and became Japan’s largest chain apparel - First urban store in Harajuku, Tokyo in 1998 - Success of fleece - (1999) and 26 million units (2000) - Fleece become synonym with UNIQLO and had 3.5 billion in sales in 2001 - First overseas store in London in 2001 but did not attract many customers (especially women due to simple designs) First collaboration with Jil Sander, 2009 - Changed Uniqlo’s brand image in Europe and North America - Initiated in May 2008 and agreed to contract in March 2009 - Affordable price

- +J highly acclaimed in Paris, New York, and London where many fashion-conscious people resided - First collection launched in 90 stores, next in 50, next in 30 and last only in 18 stores - Collaboration ended in 2011 - 5 seasons – 850 pieces Collaboration with Christophe Lemaire - 2015 Uniqlo and Lemaire collection was announced – it was a success and next collection in 2016 was also a success - Gained designers’ trust by taking the necessary time required to create a collection - Appointed as the artistic director for Uniqlo Paris R&D center and head of new line – Uniqlo L. - Found Uniqlo’s commitment to product development, high quality, and teamwork inspirational and impressive Target segments - “Uniqlo Made for All” introduced as a slogan in 2010 annual report - Its main target had been middle aged men but now it was expanding for anyone between five to sixty-four - Affordable, high quality and basic clothing - Sweaters with 100 different colors and 4XL for men, 3XL for women - Zara and H&M targeted 16 – 35 who spent more money than most other age groups: affordable prices and new trends - +J helped with women’s clothing in the above demographic - To improve image with women, the company sponsored sports players + also improved by sister brand GU GU - Growing popularity among young audience improved company’s brand personality - Delivered more fashionable clothes and targeted a younger demographic - Based on fun fashion at low prices (Like Zara and H&M) - Turning point – release of jeans in March 2009 – incredible priced - After jeans, revenue slowed, therefore CEO made strategic shift - Started offering more fashionable items - Changed supply chain to lower production costs and increased number of products - 2015 – Gaucho pants became hit - LOWER PRODUCTION COST STRATEGY – PAGE 5 Uniqlo in China - Focal point due to rapid growth of middle class - Was considered fashionable by youngsters - Graphic tee collection was popular in customers in their twenties and young - Sales increased and they opened more stores in tier 1 and tier 2 cities in China

The competition Zara - Less than 21 days to manufacture new design - Fast due to efficient supply chain - Target audience – women in mid-twenties who were fashion and price conscious - 2016 – Join life and plan to be sustainable by 2025 - Short turnaround H&M - Largest market – Germany - Upgraded products at higher price for fashion conscious consumers – Collection of Style COS GAP - 5 brands including Banana Republic and Old Navy, total of 3100 stores - Caters to whole family and has large target demographic L Brands - Abercrombie & Fitch Co. acquisition - Victoria’s secret has been major contributor - Net sales declined due to unrealistic body standards being promoted How covid-19 changed consumer behavior in 2020 - Led to more online shopping - People preferred trusted brands, less disposable income, and reduced shopping Increased demand in online shopping - Introduced StyleHint (AI) for customers to try different looks and view them - Customers chose Uniqlo’s products for functionality, so they improved that and design - Displayed samples near packaged items for customers to experience quality

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Case discussion 2 - Uniqlo

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