Comparative Analysis of Marketing Communications Strategies and Mix for the Fashion Market in the UK - Essay Example

Introduction Humans have a need to cover their bodies with clothing in order to protect their bodies from external substances and variable such as wind, water, dirt, sunlight among other factors. Clothes began to be used by humans over 100,000 years ago. During the Egyptian times clothes began to symbol of ones identity and more elaborate designs and colourful piece of clothing started to be created (Lambert). At this time fashion was integrated into the clothes manufacturers building process. In the 20th century clothes became a way to express one’s personality, style and to express a social statement. In the 21st century organization in the apparel business face a new reality due to the start of the convergence age which creates new challenges for companies regarding their marketing and communication mix of products or services. This report studies the apparel & fashion industry in Europe by analyzing three firms: Zara, French Connection and H&M. The report is divided into four major segments: research methods, market overview, analysis & discussion, and recommendations & conclusion. Research Methods The study of the effects of marketing channels in the apparel industry in the United Kingdom utilizes secondary obtain from a variety of sources. The information used in this report was collected from sources such as academic databases, corporate websites, annual reports, journal articles, textbooks and other online sources. Secondary research is the utilization of information that already exists such as a journal article which was crated by another author (Asiamarketresearch, 2007). In the analysis and discussion session of the report it recommends various solutions for the companies targeted in the report on how primary research can be utilized by the company decision makers in order obtain certain data to improve their operations. One particular research technique that the writer of this paper planned to implement, but was not able to perform the primary research due to time constraints was a customer questionnaire. The idea was to spend three hours with a team of four people within a hundred feet distance of a location of each of the three stores studied (Fcuk, H&M and Zara) to collect data from the customer’s of these stores using a short anonymous questionnaire. The questionnaire would include 10 questions and the minimum collection necessary to achieve a representative sample was 25 questionnaires. Appendix A illustrates an example of a questionnaire that could be utilized to collect data from customers regarding marketing communication. Market Overview The apparel industry is a very competitive worldwide industry that generates over $265 billion dollars a year. The industry is in Europe represents an important economic sectors which generates over 2.7 million jobs 220 million euros, the Baltic States and Eastern Europe are the biggest producers since provide lower operating costs for manufacturers (Plunkett Research, 2007). China is the biggest clothes producer in the world. By the year 2010 China could own a 50% market share of the clothes market (Plunkett Research, 2007). The companies in this industry including many United Kingdom retailers that support the production of clothes in developing nation have been accused by human rights protectors of being part of a capitalistic inhuman scheme of exploiting poor people by working them hard and paying a diminutive salary that does not represent a living wage. An organization called War on Want supports the right of foreign workers and is calling out the British government to establish regulation that force UK based companies to follow certain standards in their international affairs to ensure sweetshops and other undesirable manufacturing arrangement on foreign land does note abuse and exploit human beings across the world (Webbler, 2007) The United Kingdom designer fashion industry is one of the world’s top five markets behind the United States of America, Italy and French markets. The UK designer industry employs over 1,500 direct employees which represents less than one percent of the over 300,000 jobs created by the apparel industry in the regions (Culture, 2000). The companies founded in the United Kingdom as branded apparel firms have traditionally been smaller than their US counterparts. Designer fashion is a niche that targets young people between the ages of 25-34 years of age. Older teenager and young adults is also a secondary target of apparel firms dedicated to selling licensed branded products thought the retail chain or as online retail merchandise. The European clientele is similar to the American crowd as far as their consumerism tendencies evidenced by the fact that 30-35% of people who enter a store as walk in browsers end up leaving the store make a purchase of a product, in conservative non-consumerism nation such as the People’s Republic of China walk in browsers generate only 15% sales from onsite visit to a store (Plunkett Research, 2007). The utilization of information technology has increased among UK apparel businesses. Companies in the apparel industry in the United Kingdom spend 20% more one IT per computer than other companies with operations in the UK (IT is the must have – fashion for UK companies as margins are squeezed, 2007). The French Connection United Kingdom (FCUK) is a company founded in 1972 dedicated to selling designer clothes and other apparel products internationally in 30 different countries with a network of nearly 1,000 different vendors who carry their branded products (2006 Annual Report: French Connection, 2007). The company also has its own wholesale operations to sell their products directly to the customer established in New Your, London, Milan and Hong Kong. The four main licensed brands the company created and owns are Nicole Farhi, Toast, Great Plains and YMC. The target market of the French Connection is people between the ages of 18 and 35 years of age. The French Connection established an advertising relationship with Trevor Beattie in 1995 to create a logo for the company; Mr. Beattie created the controversial logo FCUK which has been utilized throughout the years in multiple commercial campaigns to market the firm’s products (Hamilton, 2006). The logo has sparked a lot of discussion among the mainstream media. Despite its offensive connotation for the conservative crowd the logo has work miracles for this firm and it is considered one of the key elements that helped this company quadrupled its revenues in a decade span of time (Colyer, 2007). The company target market is a much younger generation which feels the logo is identifies with their lifestyles and general attitudes. Reaching and sending the message to the target crowd is an important element of the marketing mix of a company. French Connection is utilizing innovation to open up new marketing channels to send their message to their target market. The target market of the company belongs to “generation i” a group of technological savvy population between the ages of 16 and 34 years of age. French connection became the first client to sign a contract with Yahoo to utilize its yahoo messenger virtual chat service for advertising and marketing purposes to provide information about the company and its products (Carter, 2005). H&M is a multinational firm in the fashion industry which operates in 24 countries employing nearly 60,000 across its internationals operations which generated in 2006 80,081 million pounds. The company during the last year has been expanding its operations with 1344 new stores opening in 2006 mostly in the North American market as well as the new rollouts of online sales into the German and Nordic European markets (2006 Annual Report: H&M, 2007). The company also opened its first stores in new markets such as its two new stores located in the Middle East spots of Dubai and Kuwait. The company uses a diversified marketing mix to get the message across of the company’s quality fashion trends. Superstar icons such as pop star Madonna have been showcased as corporate spokespersons in different advertising ads and fashion shows on the company. The new opening of stores followed the company’s strategic path of finding the best locations in the streets to achieve maximum customer traffic. Considering the consumerism trend in developed countries of achieving 1/3 conversion sales customer from window browser type shoppers finding location with high people traffic is important toward increasing overall sales. The company reached greater amounts of customers by expanding its fashion collection offering. H&M is a pioneer in the utilization of strategies such as fast fashion. Fast fashion is trendy inexpensive clothes that mimic high-end fashion and are delivered to the customers at high speed (Plunkett Research, 2007). High fashion is a great way to reach customer because not only are the threads cheaper than high-end products, they are also offer only once since there are no second production runs which allows the firm to used smart advertising ads such as “buy it now while supplies last” or “now or never”. Zara is a fashion enterprise that belongs to the multinational company Inditex, a large global fashion distribution conglomerate. Out of the three companies showcased in this report Zara has the most sophisticated interactive corporate website. It utilizes various flash technologies to bring animation to its web store which attracts the attention of the web browser. In the internet the only way to have a change to obtain an online sale is to retain the customer long enough to have a chance for the person to start looking around the store for the product offering of the company. Zara takes the fast fashion to another level. This company has a product offering which is twice to three times the size of its key competitors. The company strategy is to keep a constant flow of new merchandise coming in. If a particular brand is does not sell well it will be gone off the shelves within a week and all subsequent order will be cancel. The company can produce and fill the shelves with a particular product in less than month. The company despite its original designs is been characterized as a fashion imitator and its production strategy is evidence of this claim. The company does not fully stock its stores with new items at the beginning of a season such as winter. It waits to see the movement of merchandise and then redesigns the products and brings in new merchandise in between season according the movement of merchandise and the fashion trends preference movement they perceive from the customers. The company’s CEO, Jose Castellano, says that the secret of Zara’s success is its reliance on communication and how it uses existing technology to take control of its design, production, and distribution of fashion (Cnn, 2004). Analysis and Discussion The marketing mix of a company and the way it communicated with customers the desired message does not occur at the end of the selling cycle when the customer deciding whether or not make a particular purchase, it is a process that starts before a piece of clothing is ever created. In the apparel industry the most efficient way to attract a customer’s attention is based on the actual design of the clothes and its price point appeal in regards with the perceived quality of the product. Designing can not be based only on the creation and intuition of the designer. Real data has to compile from the customers I the form of feedback in order to successful create clothing based on the needs and desires of the clients. In order to obtain the feedback needed from customers companies such as Zara or H&M have to perform primary research to collect data directly from the customers. Questionnaires or surveys are the fastest way to obtain data from the customer. Customers can be persuaded to answer survey if some type of incentive is offered for their participation. A common way to provide incentive for participation is a merchandise savings of 50% to 90% discount for participation in a survey. Collecting information electronically through email systems or through surveys directly placed in the corporate website is fast inexpensive way to perform primary research. There are new trends that if implemented can pay huge dividends for a company in the apparel industry. The designing and manufacturing process is changing and the utilization of nanotechnology has reached the industry to enable companies to provide greater detail in its fashion designs to performing diminutive graphics illusions into the designs of clothes. Nanotechnology is also allowing or facilitating greater production at lower prices for manufacturers. A second technological trend that will directly improve communication and integration of online sales platforms for apparel companies is the utilization of scanning technology to create customer profiles. The US based apparel giant Levi’s Strauss already started to use this technology to scan the bodies of its customer in order to create a profile that can be used online to perfectly match a person body type with the available clothing in the online stores (Plunkett Research, 2007). The reason this strategy could bring incredible benefits is that in the clothing business people who make online purchases return 30% of the merchandise mostly due to the compatibility of clothes, in other words the clothes did not fit the person. A third trend that can help companies connect with the customer needs without saying a word is by adapting green apparel practices into its product offering. A green product is a good produced in an environmentally friendly manner. A green trend in the apparel industry is the use of genetically engineered cotton. Conclusions & Recommendations The apparel industry has become a very competitive industry in which only the companies that implement a good marketing mix and effective communication strategies will be able to survive in the long-run. In developed nation such as the United Kingdom firms in this industry compete based of fashion and original designs that allow the creation of licensed brands that enable companies such as Zara, H&R and French Connection to created brand identity and sell its branded products at a premium price. Out of theses three firms the company that masters the art of online sales will achieve the greater growth in the 21st century. Despite the widespread nature of the internet worldwide and the fact that e-commerce is an existing marketplace e-commerce and online sales are still in their birth stage of its business life-cycle. Innovative solutions such as Levi’s body scan of customer to create sizing profiles are the type of things these European companies must implement in order to achieve greater online sales numbers in the future. All three companies must stay on top on marketing trends such as the introduction of web television, the expansion of digital television, new mobile advertising technologies, the use of console games for advertising purposes, and personalized online media channels that can transmit information regarding products directly to a person computer. Change is a part of life and a business reality that can not be denied, those who which to stay ahead of the competition must find ways to apply innovation and creativity into its marketing function in the future in order to become successful global players. References 2006 Annual Report: French Connection (2007). Available from [Accessed 5 December 2007]. 2006 Annual Report: H&M (2007). Available from [Available 5 December 2007]. Asianmarketresearch.com (2007). Secondary Research. Available from < http://www.asiamarketresearch.com/glossary/secondary-research.htm> [Accessed 4 December 2007]. Carter, B. Yahoo lands FCUK as first messenger advertiser. Marketing (2005). Available from [Accessed 6 December 2007]. Cnn.com (2004). Zara: A model fashion retailer. CNN. Available from < http://www.cnn.com/2004/TECH/07/19/spain.zara/index.html> [Accessed 5 December 2007]. Colyer, E. (2002). Offensive but effective. Brandchannel. Available from < http://www.brandchannel.com/features_effect.asp?pf_id=84> [Accessed 5 December 2007]. Culture.gov (2000). 6 Designer Fashion. Financial Times. Available from < http://www.culture.gov.uk/NR/rdonlyres/97052A61-B72A-4D82-A98A-6417418FB70C/0/Fashion.pdf> [Accessed 6 December 2007]. IT is a must for UK fashion companies as profit are squeezed. Computer Weekly (2007). Available from [Accessed 6 December 2007]. Hamilton, J. Beattie ends feted relationship with French Connection after 10 years. Campaign (UK), 27 (2006). Available from [Accessed 6 December 2007]. Lambert, T. A Brief History of Clothes. Available from [Accessed 5 December 2007]. Plunkett Research (2007). Apparel Industry Trends. Available from [Accessed 6 December 2007]. Plunkett Research (2007). Apparel Industry Statistics. Available from [Accessed 6 December 2007]. Webbler, T. (2007). Let’s clean up fashion. Available from [Accessed 6 December 2007]. Appendix A: Questionnaire 1. How many times do you shop for clothes in a month? 2. Have you ever purchased a product based on an advertisement you saw on the press, television or radio? 3. Have you ever used a discount coupon you received from a company? 4. Do you call companies or write email to companies you purchase products from? 5. Is communication an important factor that affects you decision to buy or not a buy a product? 6. Do you prefer to purchases branded products or discount merchandise? 7. Do you own a computer? 8. Do you visit the website of stores you purchase good from? 9. Have you ever purchased merchandise online? 10. What influences you purchasing decision more (choose one) a. price b. marketing communication c. quality of product d. none of the above Read More