The Fashion Industry and the New Consumer of Topshop in the UK - Report Example

The Fashion Industry and the New Consumer of Topshop in the UK By: Executive Summary Fashion is a very big industry. Economists call fashion a billion-dollar industry (Bailey, 2014). The industry employs millions of people around the world. During the late 1980’s, there were several large retailers dominating this fast evolving apparel business (Bailey, 2014). Over the past years, there have been emergences of more and more retailers in this industry. Topshop is an example of multinational fashion retailer of fashion that has emerged and taken over the industry. The retailer concentrates on clothing, shoes, make-up, and accessories. The paper will discuss the consumer behavior in the fashion industry, where it will explore the consumer attitudes and the decision making process. It will then highlight the advantages of good digital strategy to a brand. The digital strategy will be related to the market mix. Finally, the conclusion will detail the recommendations obtained from the analysis. Contents Executive Summary 2 1.Introduction 4 2. Consumer behavior in the fashion industry 4 2.1 Fast fashion 4 2.2 Consumer behavior 6 2.2.1 Attitudes 6 2.2.2 Decision making process 9 3. Role of trends in marketing (Digital) 11 3.1 What is digital 11 3.2 Overview of Topshop’s digital strategy 12 3.3 Digital strategy in the market mix 12 3.3.1 Product 13 3.3.2 Price 14 3.3.3 Promotion 14 3.3.4 Place 15 4. Conclusion 16 5. References 17 1. Introduction Studies indicate that the theory of consumer behavior came from studies in psychology studies in the past century (Chaudhuri, 2006; Belk, 2010). However, they had to wait until 1968 in order to become systematic theories (Belk, 2010). Despite being a young filed, there is expansion of the field of research, focusing on consumer behavior. Focusing from the market perspective, research in consumer behavior is crucial for marketers in understanding their target market (Belk, 2010). For instance, Topshop in the UK rely on research focusing on consumer behavior, to develop market strategies. Because of this undertaking by Topshop, their management is able to apply the consumer behavior theories in their various shops. The paper will conduct a detailed analysis on Topshop’s target audience and will critically study the factors that affect the buyer behavior of its customers. Additionally, the paper will critically evaluate the application of marketing practices from the point of view of the customers and asses the current roles of trends in marketing as components in the contemporary commercial environment. 2. Consumer behavior in the fashion industry 2.1 Fast fashion Experts came up with the new term ‘fast fashion’. The term means clothing that emphasizes on the recent fashions (Egluusphera, 2014). Topshop is a retailer that concentrates on fast fashion. Experts argue that the word ‘fast fashion’ came about because the fashion cycle is moving very fast. Powered by the evolution of technology, as discussed on the second part of this paper, the rate of updating fashion is becoming rapid (Hammond, 2012). The effects of this fast update of fashions are formations of new markets and field. Economists noted a difference between this market and the conventional fashion market (Hammond, 2012). There is faster growth and consumption hence the new market will contain a shorter cycle.. Below is the fashion cycle (Wang, 2010). The fashion cycle consists of the introduction, acceptance, culmination, and decline of acceptance (Wang, 2010). In the above figure, the pattern is regular. In other words, the cycle begins with innovation (Perrey, 2012). The first step is called introduction stage. The following stage is the acceptance stage. In this stage, the fashion is culminating. The next stage is decline of fashion adopters. It declines until it becomes obsolete (Hoovers, 2008). There are different kinds of fashion, which makes the cycle’s length and shape to be different (Wang, 2010). Though many fashions demonstrate a moderate cycle, others are either long-lived or short-lived. Apart from moderate type of fashion, there are also fads, fast fashion, and classics types of fashion. The figure below compares the four types of fashion (Bailey, 2014). Fast fashion is between moderate fashion and fad (Bailey, 2014). A fad is a type of fashion that does not last for long after becoming popular (Bailey, 2014). Moderate fashion is common in the moderate period, and it is cyclical. There are many reasons why Topshop chose fast fashion. The main reason is that the retailer wanted to satisfy there large number of customers at demand’s peak (Heinemann, 2010). 2.2 Consumer behavior 2.2.1 Attitudes Numerous scholars in psychology view attitude as one important variable that intervene between the market mix and consumer behavior (Fearon, 1987; Sokolowski, 2013; Lake, 2009; Chaudhuri, 2006). It is necessary for attitude to exist because it serves some function for an individual, which are influence by the underlying motives of the person. In other words, the motivational pattern that support attitudes are the ones attitudes are based on (Miller, 1978). Studies identified four main functions of attitudes. These functions are utilitarian, ego-defensive, value-expressive, and knowledge function (Steckstor, 2011). When it comes to utilitarian function, the attitudes depend on the product’s feeling of pain or pleasure. The ego-defensive function is about an individual’s attitudes towards protecting oneself from internal feelings (Steckstor, 2011). The value-expressive function of attitude influences a person to choose a product based on how it describes him/her as a person. The knowledge function concerns attitudes formed by a person due to need or meaning (Belk, 2010). Attitude is build through experiences. Different consumers have different attitudes. The attitudes range from consumption-related behaviors, for example how much a person loves shopping in Topshop, to product specific behaviors, for instance shopping at Topshop rather than any other retailer (Wilson, 2013). What a person thinks or knows about something often affects the attitude (Albarracin, 2014). Additionally, factors such as how a person has an opinion for or against a merchandise always affects attitude. The above model demonstrates the ABC model of attitudes. The above model emphasizes on the relationship between knowing, doing, and feeling (Krugman, 2013). Each step in the above model describes the steps involved when forming an attitude. The model clearly explains the impact of the three components (Krugman, 2013). In the high involvement section, the process results in customer loyalty. The process assumes that the customers are participating effectively in making buying decisions. It is in this process that most attitudes are developed (Krugman, 2013). A customer who forms an attitude in the low involvement process, one acts based on limited knowledge. It is assumed the consumer does not prefer one specific brand, for example, bras (Krugman, 2013). Fashion is a high-involvement product and is very important to many customers. The experiential process assumes that the consumers act consist of emotional reaction. In this process, it is evident attitudes are influenced by attributes, for instance advertising and packaging design (Krugman, 2013). Topshop emphasizes on this perspective because fashion is often emotional and not rational at all times (Krugman, 2013). 2.2.2 Decision making process The paper relied on the conventional consumer behavior theory in this part (Peterson, 1984). The theory states that there are three psychological processes that are used in consumer decision making. The first process is called, processing, followed by learning, and finally attitude, and behavior change (Peterson, 1984). Below are the stages of consumer decision processes (Peterson, 1984): The need of recognition Looking for information Evaluation of pre-purchase alternative Purchase Consumption Post-purchase alternative evaluation Divestment The process in the above model is common during decision making in purchase situation. In the pre-purchase section, the customer always needs recognition, search information, and pre-purchase alternative evaluation (Peterson, 1984). In this process, the customer understand what he/she wants. Pre-purchase alternative evaluation is the final step in this section. The step is useful in comparing different merchandise and brands (Peterson, 1984). Finally, the consumer carries out the purchase, consumption, post-consumption, alternative evaluation, and divestment (Peterson, 1984). The theory of consumer decision process model has been discussed above. However, one has to ask himself questions like, should the theory fit the fast fashion’s consumer decision process? Are there differences (Chaudhuri, 2006)? Majority of Topshop customers have expectation before they go to purchase. It is just a few of them who do not know about what they are going to buy. However, for those who have expectations, there is a big chance for them to buy clothes that they do not look forward to until they see them. Actually, the much apparel that many consider as fashion does not lend itself to a rational consideration as a response to a problem. Many people consider fashion as not a necessity in life (Reynolds, 2001). A good example is a boy finds himself needing a pair of pants inside Topshop. The boy might have considered, first internally and then externally. He may compare several sizes and colors, but if a pant appears so exciting and perfect, perhaps time is limited; he may not search for any other alternatives. He then decides to buy the pant without much thinking. When comparing the boy in the above example with the consumer in the model of consumer decision process, it is can be noted that pre-purchase behaviors are so different. This means that, the pre-purchase section in the above model including all the steps is not always applicable to the fast fashion consumer behavior (Hale, 2008). In summary, the process involved in fast fashion decision making varies. It happens in three patterns (Hale, 2008): Buying as by certain expectation. Buying unexpected item with certain expectation. Go purchasing without any expectation. Inside Topshop retailers, new products come into stores and are replaced by next collection quickly. Majority of their consumers may not have the chance to see the product twice (Clifton, 2009). Every time the consumers visit their stores, new merchandises attract them. In fact, these customers do not have time and condition to form any clear expect about the fashion products (Clifton, 2009). Experts argue that this may have two effects on the consumers (Betsch, 2014). One, there will be no subconscious awareness of some cloths. To avoid regretting, customers buy immediately (Betsch, 2014). Two, customers will never be stimulated by fresh fashion. This specifically happens to the female customers. They often buy due to emotional motive (Betsch, 2014). In conclusion, it is important to not that urgency sometimes can accompany the behavior of consumers (Bruggen, 2010). Moreover, fast fashion is very heap. Consumers do not consider much about the risk of purchase. This leads to impulse purchase (Bruggen, 2010). 3. Role of trends in marketing (Digital) 3.1 What is digital A study by Lantos defined going digital as about defining the best ways of achieving organization’s (Lantos, 2010). This usually happens when marketers use electronic connected media, for example, the web to promote their products and services (Lantos, 2010). The author further argues that digital could be useful in internal operations of a company, improve the public image by improving transparency, and maximize production by improving the supply chain (Lantos, 2010). 3.2 Overview of Topshop’s digital strategy End of year reports indicate that Topshop has been successfully integrating digital channels to its marketing campaign (Clifton, 2009). The most important point to note is that, interactive marketing communications formulated by the retailer gave its customers a voice. This cemented the retailer’s position as the best clothing retailer in the UK (Clifton, 2009). In all Topshop’s strategies, the common plan is to connect with a wider audience. The management of the retailer is very determined, in that in the 2013 London Fashion Week, the retailer collaborated with Google+ (Clifton, 2009). The management wanted to demonstrate the importance of good relationship between digital systems and marketing practices (Clifton, 2009). Before this extraordinary event stated above, the brand had invested on a creative team on its YouTube channel. The channel starred models such as Rosie Tapner and Jourdan Dunn (Sokolowski, 2013). The models allowed the viewers to ‘Be the model’. The viewers also felt what the model experienced (Magett, 2014). In summary, Topshop embraced digital revolution in order to fulfill customer demands of needing more relationship with companies that affect their lives (Clifton, 2009). The brand seized the opportunity and became part of digital marketing. In fact, they have a website that focuses on online shopping (Clifton, 2009). 3.3 Digital strategy in the market mix Brand marketing dates back to the 1950’s (Hoovers, 2008). During this period, companies such as Procter & Gamble used brand marketing to differentiate their products from their competitors (Hoovers, 2008). A good digital strategy will help the customers out there to justify the high price for a high-quality product. Topshop became a household name because of good marketing strategy, especially on the digital platform (Pride, 2014). The 4 Ps of marketing include product, pricing, promotion, and placement (Poole, 2012). It is very possible for each of these Ps to be used together with one another to create the best market mix. This results to maximization of profits and good sales (Hemann, 2013). The above figure illustrates the 4Ps. 3.3.1 Product It is common to touch, look, smell products in order to determine the quality (Schenker, 2013). Nowadays, statistics indicate that there more people conducting business on the e-commerce platform. This makes it hard for consumers to make the right purchase decision (Schenker, 2013). However, for marketers, just because business happens in a virtual environment that does not mean quality will suffer (Schenker, 2013). In fact, with this technology, customers can determine the quality of goods by simply finding the reviews over the internet (Schenker, 2013). The marketing strategy of Topshop emphasizes on the features and benefits. The features and products have to different from their competitors (Clifton, 2009). The brand’s performance and quality of goods will always be the best (Clifton, 2009). The brand’s online website helps the customers determine whether to buy at the retailer. 3.3.2 Price Any customer would consider price before making the purchase decision (Schenker, 2013). Therefore, if brand in fashion industry does not consider prices in reference to product quality, the sales will fall short (Schenker, 2013). Economists argue that the price-vale equation is necessary for success. Any customer wants a high quality good that has a competitive price. Ana additional deal or coupon is always a success factor (Schenker, 2013). Topshop has created a prestigious brand name, which delivers on quality. Customers are always willing to pay high prices (Clifton, 2009). 3.3.3 Promotion When it comes to promotion, it involves different ways in which the brand tells their customers about their products (Schenker, 2013). Literatures reviews and numerous studies indicate that promotion and place make up the biggest difference traditional and digital marketing strategies (Schenker, 2013; Egluusphera, 2014; Poole, 2012). It is common for products to be promoted through radio, the television, the print media, outdoor advertising and many more (Schenker, 2013). Topshop has used these channels to advertise their products, and in some cases used Free Standing Inserts in consumer package goods. Additionally, the brand also provided coupons inside newspapers (Clifton, 2009). The television and radio is crucial in improving brand awareness (Schenker, 2013). According to Schenker, they are known to drive sales and consumer action (Schenker, 2013). On the other hand, analytics drive digital marketing. This makes digital marketing measurable (Wilson, 2013). Examples of digital marketing are facebook marketing, email marketing, search marketing, targeted banner advertisements, social media, and more. With measurable tactics in place, marketers are put in control of testing the market mix (Wilson, 2013). 3.3.4 Place This is where the product is sold. Many refer to this as the distribution (Schenker, 2013). Whether the products are sold at an online website, the retail shops, inside another retailer, each of the location bring rewards and challenges (Schenker, 2013). Nowadays, the fashion market is much more global (Bailey, 2014). A few decades ago, Topshop begun as a local and regional retailer. As by now, the retailer has almost 500 shops worldwide (Clifton, 2009). There are many fashion options today (Bailey, 2014). The management of Topshop had strategies aimed at tackling with their competitors effectively in order to maintain their profitability. They also made sure their products could be sold outside the UK (Schenker, 2013). 4. Conclusion The paper has conducted a detailed analysis of the consumer behavior of the Topshop retailer in the UK. The main results from this analysis are valuable for marketing strategies (Mckeown, 2012). There is need for provision of more information; especially in understanding the advertisements because there is low involvement is fast fashion (Bailey, 2014). Low involvement is a disadvantage to marketers (Bailey, 2014). The successful fashion brands such as Topshop are known to providing more information about their products (Clifton, 2009). There is need to improve store situation, that is, store environment. This will make the brand earn respect from customers and will help marketers spread easily the brand image to the customers. (Chaudhuri, 2006). It is important to influence customers’ attitudes to the brand (Albarracin, 2014). Once good attitude is formed, people will form beliefs on the attitude. This will become part of people’s way of life and how they act (Albarracin, 2014). Lastly, there is need for promoting a brand or service through digital systems for example, the social media platform, email marketing, and such (Schenker, 2013). Brands should have a strong digital strategy that matches the market mix of the organization (Schenker, 2013). 5. References Albarracin, D. (2014). The Handbook of Attitudes. Psychology Press. Bailey, S. (2014). Visual Merchandising for Fashion. A&C Black. Belk, R. W. (2010). Research in Consumer Behavior, Volume 12. Emerald Group Publishing. Betsch, T. (2014). The Routines of Decision Making. Psychology Press. Bruggen, G. H. (2010). Marketing Decision Making and Decision Support: Challenges and Perspectives for Successful Marketing Management Support Systems. Now Publishers Inc. Chaudhuri, A. (2006). Emotion and Reason in Consumer Behavior. Routledge. Clifton, R. (2009). 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