Uniqlos Global Marketing Plan - Essay Example

UNIQLO’S GLOBAL MARKETING PLAN al Affiliation) Mission ment UNIQLO is a Japanese company that carries out its operations in the fashion industry. The company has a global strategy which entails it expanding its territories to overseas markets. The company’s mission is to be among the leading companies in the fashion industry internationally. Its business objectives and goals are structured to move in line with the company’s mission. The company’s plan to enter into international markets has the sole reason of increasing its sales revenue and market share in global markets. To achieve this goal, UNIQLO is strategizing to enter the South American. The company has spotted Brazil as the first destination in the region where it will launch its operations. UNIQLO intends to satisfy the customers’ needs and wants concerning their fashion preferences. They do this by having a variety of clothes designs that embrace almost all the cultures. This is line with the company’s goal of providing customers with fashion designs of the best quality so as to maintain the customer loyalty and to attract others. UNIQLO intends to compete favourably with other international brands such as Zara. These companies are the international leaders in the fashion industry. The company believes that through effective strategic management and the prioritization of their goals and objectives the company will break these supply chains. This will put UNIQLO at a better position to compete with these companies for international customers. Diagnosis UNIQLO’s performance in the local markets is very impressive. Its annual sales have been increasing gradually over the past year despite the intense competition that it receives from other fashion retail companies in the market. It currently reports annual sales revenue of 1.15 trillion yen. This figure is quite impressive when compared against the industry standards. The operating also registers a good operating profit of 140 billion yen. The company’s local performance supports the idea of the company expanding its operation into the global markets. UNIQLO’s management believe that if the company performs well in the local market there is no doubt that its international performance will also be tremendous. Currently, in a bid to expand its boundaries to international markets, the company is operating more than 300 stores in Japan, USA, France and other parts in Europe. The company’s headquarters is still in Tokyo, Japan. The company’s brand has been appreciated in these overseas brands. This serves as a test sample of the company’s dominance in South America. Despite the company being in the Great China which comprises of China, Taiwan and Hong Kong, it has various subsidiaries in several countries in the south eastern parts of Asia. These countries include Indonesia, Thailand, South Korea, Singapore, Malaysia, and Philippines. The stores in these countries are usually supplied with large volumes of the company’s products to satisfy the large demand of the goods which is mainly caused by the high population in the region (Jeannet, Hennessey, & Jeannet, 2004). UNIQLO employs approximately 30000 people in all its stores around the world. The team of workers consists of unskilled, semi-skilled and skilled workers. These workers are fully dedicated towards achieving the firm’s goals and objectives. They also maintain the necessary focus to enable the company move along with its mission. The company attributes its performance success to its employees. The employees are well enumerated and as a result of this they work to the best of their capabilities to ensure the sustained growth of the business. This growth is highly essential in the company’s implementation of its global strategy. The current position of the company puts the company at better position to enter further into the international markets. Its current financial position and cash flow status gives it an upper hand in launching its operations in Brazil over its competitors who might be having financial difficulties. Product Review UNIQLO manufactures and distributes clothes for use by the whole family. It does not make clothes for a specific group. Everyone can wear its clothes, every day. It produces its clothes using the theme Life Wear. The clothes are made of different colours but a majority of them are of bright colours since the colours blend well with type of fabric the company uses. Some of the significant brands made by UNIQLO include; UT Collection, UJ Collection and the Fleece Collection. The UT Collection is a unique design that incorporates distinctive cultures of global music, art and comics to produce printed T-shirts designs. These comprises of the round neck, V-neck and sleeveless T-shirts. They are printed logos and graphics that send global massages. They represent the feelings that the individuals of different regions and cultures have on different aspects of life such as politics, music, financial situations and sports. This infuses personality, emotions and cultural identity in the T-shirts (“Uniqlo”). The UJ Collection is a design that invests a lot of time, facilities and resources to sew high quality jeans. These jeans observe refined detail and their high qualities are far more than the prices they charge. They are very comfortable and are made in a variety of colours. The Fleece Collection is the most popular product among the three products. It is preferred by both the local and international customers. It mainly comprises of lightweight and warm outfits that are everyone’s’ favourite. The design to pays attention to detail and quality and comes along in a variety of colours. All these clothes are designed in a modest and fashionable way to suit all types of customers regardless of where there cultures. The Company’s clothes are unique from those from those of their competitors. They do not have to struggle to fit in the market as their competitor products which have to be redesigned frequently in a bid to move along with the fashion trends. The Company has a technically advanced design of outfit known as Heat Tech. This garment is to be worn in the cold seasons since it retains warmth despite being made out of light material. Its demand is very high in the international markets since many customers prefer wearing light clothing for warmth than the usual bulky clothing. Market UNIQLO chooses Brazil as their first destination in its entry of the South American market. Brazil is among the countries that experience rapid growth in their economies world. Its promising performance in the future shows the country to have a high consumer potential. Brazil’s location is along the South Atlantic beach part of South America. The country has a sea front along its western border. The country neighbours Bolivia, Argentina, and Paraguay in the eastern side. The fact that Brazil occupies the largest land on the entire South American continent gives it an upper hand when it comes to development. The country has a population of approximately 200 million. This population comprises of about an equal number of both men and women. Majority of this population is between the ages of 16 and 55 years. This section of the population is very active as it is very mobile especially in terms of rural to urban migration. It is responsible for the country’s growth in economic performance and productivity. UNIQLO primarily targets this group in its clothing since the group covers approximately 60% of the entire population (Paley, 2005). Brazil has achieved a constant growth in its gross domestic product. Its exportation of iron ore to China is a major cause of this stable economic performance. Recently, the country discovered offshore oil fields. This fact has assisted the country to become self-reliant in oil. This has lowered energy costs in the country making the productions costs affordable. The exportation of iron ore, oil and other natural resources are the sole reason of the country’s GDP rising from US$ 2.3 trillion in 2013 to US$2.4 trillion in 2014. The countries employment level is on the increase. The country is putting all its effort in removing a large portion of its population out of poverty. UNIQLO will have ease of accessing relatively cheap labour in this country. Brazil’s government is in full support of the international fashion brands. In a bid to encourage foreign investment into the country it supports competition of the local and international fashion brands. Despite the fact that the country is one of the largest exports in textile it still welcomes fashion retailers in its market. The government does not impose any trade barriers in the market. This facilitates the entry of new players in the market. UNIQLO will be at ease to carry its operations in the country (Ryan & Jones, 2009). The productive segment of the country’s population is comprised of 100 million people who can as serve as potential customers for a multinational corporation such as UNIQLO. The fashion consumer market in Brazil is mainly comprised with high and medium social classes in the society. This segment of the population is comprised of high and medium income earners. Brazil is a famous cultural hub of fashion in South America. Fashion plays a major role in the clothing industry and local society in the region. This trend is sustained through the constant supply of the fashion industry both locally and across the borders. This market comprises of both local brands and international brands such as Top man and Zara. The existence of foreign players in this market implies there is opportunity and potential for a multinational corporation such as UNIQLO to enter into it. UNIQLO can enter this market using various entry methods but the best methods are foreign direct investment and joint venture. The level of control and ownership of the company will be a key factor in determining which of the two options the company is better for adoption. Full control will favour the foreign direct investment while limited control will be in support of the joint venture. Distribution The distribution of UNIQLOs brand in Brazil will largely be influenced by the entry method the company chooses. The company has a good opportunity to form partnerships with the local fashion retailers in Brazil. These partnerships will facilitate the penetration of the company’s brand into this new market. It would tap the brand into already established distribution brands and the company will get ease access to the consumers of its partners. This option will act as a good starting point for UNIQLO to infiltrate into the new market. The option can be combined with the foreign direct investments to spread further into the Brazilian market. The foreign direct investment can be launched in the country by the opening of a retail outlet in one of the big towns in Brazil such as Sao Paolo. Sao Paolo is Brazil’s biggest consumer market for the fashion industry. The company also intends to sell its products in strategic outlets to target many customers. The company should come up with the most effective techniques of getting products to customers. It is considerate that the company uses mix of these methods. The company intends to open many convenient stores in the Brazilian market where customers can go and purchase their products with much ease. The company can also bring the sale of these products to the doorsteps and neighbourhood of consumers in a bid to increase its sales. The company has also incorporated the idea of using the internet to make online sales of their products. This will allow access of the company’s products from any part of Brazil. This strategy will make it easy for customers and potential customers to get the company’s products and information about these products (Solomon, 2003). Promotion Strategy UNIQLO has the mandate to identify and study its target group to have effective promotion and advertising in the Brazilian market. The company carries out a market research to understand the Brazilian advertising culture to be at a better position to fuse it with its Japanese influence. UNIQLO does not identify its target customers in terms of age, ethnicity and gender. Its products are designed to meet all consumer needs. This is in line with its global brand philosophy that supports their slogan which is portrays the company’s product as designed for everyone. A further research into the target market groups shows that the company has two categories in their target group; secondary and primary target market groups. Its primary target group comprises both men and women between the ages of 16 and 25 years. This group consists of individuals who are either in higher institutions of learning or at the early stages of employment. Majority of the population in this group get their income from educational loans and part-time jobs. They leave in urban areas and have little responsibility. This group has a lot of fashion enthusiast individuals in its midst. These factors give explanation to the disposable income and high purchasing power of the group. This group has greater access to the retail shops and it is important that UNIQLO captures them. There is high social networking among the members of this group. The members of this group therefore have high tendency of learning UNIQLO’s brand through siblings, friends, social media or events. The group’s desire for urban, flashy and trendy lifestyles contributes to the group having a high demand for new fashion designs in the market. UNIQLO considers this group as its main target since they produce a variety of fashionable products that would easily influence it. UNIQLO’s secondary group comprises of men and women between the ages of 26 and 35 years. Despite the fact that this population is older than the previous group, they are still passionate and sensitive to fashion trends. They prefer casual, well-designed and high quality clothes that can go along with their active and busy lifestyles. Majority of the population in this group consist of young professionals with the desire to have attractive appearances. This population gets an increasingly fair income with less financial budget constraints which influence their demand for fashion designs of high qualities (Van der Westhuyzen & Horan, 1998). UNIQLO intends to have its brand as a dominant one in the Brazilian market. It wants to have a larger market share as compared to the local brands in that market. It restructures its organization’s operations to enable it meet this goal. The company invests with a dedicated team of staff who participate actively in the brand’s promotion in the new market. The employees have vast knowledge on the company’s products and are at a good position to reach out to potential customers. In a bid to promote the company’s brand in Brazil the company open its stores in places with good business atmospheres. These are places which have conditions that favour its business operations such as proximity to busy institutions and busy roads. The Company intends to advertise its products aggressively so as to reach to as many potential customers as possible. These advertisements are to be done on television commercials, radio stations, newspapers and fashion magazines. They are structured in a way that they will reach both the primary and secondary target groups in the population. The Company will also hold several launches in the big cities in Brazil to advertise and sensitize its products to potential customers. In a move to attract youthful customers who constitute a large percentage of the brand’s potential customers the company will sponsor some of their activities such as sports and music. Competition The new market is concentrated with both international and the local fashion retailers who have their hopes in taking advantage of the country’s fast growing economy and vast consumer base. UNIQLO will get vast competition from Hering, a local brand in Brazil. The brand runs approximately 280 stores in about 100 cities in the country. This Company is very popular in Brazil hence the reason behind it being a leader in the sector. The country also has international brands such as Zara which runs 40 stores in the country and Arezzo, an Italian retailer, which runs 220 stores in a joint venture with the Brazilian retailers. These companies are well established in the market and it will need UNIQLO to produce unique products to bring product differentiation in the market. Despite the vast competition that UNIQLO faces in its entry into the Brazilian market, its brand has a competitive advantage over its competitors. The company embraces all gender, ethnicities and ages as their target group. This gives it an advantage over its competitors who discriminate across these borders. The company also uses modern Japanese designs in its brands. These brands have high quality garments and fabric that attract many customers. The company engages in a procurement system that puts its bases on customer feedback. This ensures accountability in all aspects of the company’s production system. The company is equipped with a technical team full of experts from different fields. These experts ensure that the brand produces designs of the best qualities. UNIQLO has a vast experience in aesthetic clothing. Their stores are kept clean and bright leaving the main attention to the clothes. The design of the brand’s clothing gives it competitive advantage. The design incorporates high quality craftsmanship with intense beauty. The company’s products have a variety of colours from which customers can choose from. These factors make it possible for customers to customize their clothing and preferred styles. The designs also blend well with other designs for a smart-casual appearance. The second element which puts UNIQLO at a better position is its sensible pricing. The company charges its products relatively cheaply as compared with the high values and qualities they portray. This automatically knocks of threat of price competition from its rivals. The company does not sacrifice its style and quality to keep prices low. The company also offers unique engineered designs of clothing which have technologically advancements that give them enhanced performance. A good example of these products is the famous Heat tech garment. Conclusion UNIQLO is increasingly spreading its wings to become a dominant player in the international fashion industry. The brand is preferred in many markets over its competitors due to its quality, functionality, simplicity and relative cheaper prices of its commodities. Despite these, the company will still face the challenges that similar multinational corporations face when entering new markets. It is highly appropriate that the challenges are taken into account when entering the Brazilian market. References Jeannet, J., Hennessey, H. and Jeannet, J. 2004. Cases in global marketing strategies. Boston: Houghton Mifflin. Paley, N. 2005. The managers guide to competitive marketing strategies. London: Thorogood. Ryan, D. and Jones, C. 2009. Understanding digital marketing. London: Kogan Page. Solomon, M. 2003. Conquering consumerspace. New York: AMACOM. Uniqlo.com, 2015. Home page | UNIQLO. [online] Available at: http://www.uniqlo.com/my/ [Accessed 13 Apr. 2015]. Van der Westhuyzen, B. and Horan, L. 1998. Marketing strategies. Observatory: Future Managers. Read More