To Build A Strong Brand Within The Fashion Industry - Essay Example

TO BUILD A STRONG BRAND WITHIN THE FASHION INDUSTRY: A MULTIPLE CASE STUDY APPROACH 4 Case studies and findings 4 Introduction Branding of a product performs an extremely significant role in the determination of the consumers’ buying behaviours. This is because those brands which are perceived as strong provide imperceptible values to the respective companies thus, resulting in the enhancement of the efficiency, productivity and build up of healthier relations with the clienteles (Herriott & Firestone, 1983). In the global fashion industry, entry and establishments of trademarks such as Top Shop, H & M, D & G, Armani Exchange, and Zara has acted as a dynamic reagent to the industry’s growth (Welters & Lillethun, 2011). These brands and their respective strategies are the basis for this case study that will employ a multiple case study approach. The adoption of multiple case studies design in the analysis is because the design produces more compelling evidence than single studies, in addition to providing stronger basis for construction of the theory (Yin, 2003). 4.2 Case Study 1 – Zara 4.2.1 Background Founded in 1975, Zara is a Spanish retailer of clothing and accessories that is part of Inditex group with its base in Arteixo, Galicia. Since its debut in the fashion industry, the company has risen to the top and is currently one of the main stakeholder brands in fashion worldwide. Contrary to the fashion industry product development period of six months, the company has found efficient production processes that enable it to come up with a new product and release it to the store shelves in just two weeks (The New York Times, 2012). This has been one of the key strategies to its growth worldwide. With such an approach, the company has so far won the war of transferring its production aspects to low cost countries like China that is currently the wide trend by top fashion brands in the industry. The company currently has a large distribution network with 1751 stores worldwide trading as Zara and an extra 174 doing business as Kiddy’s class stores; the company’s branch for children’s clothing. The company sells 50% of its products within Spain, 26% in other European counties with the remaining 24% destined for Asia, Africa and the rest of the world (Dahlén & Lange, 2008). 4.2.2 Data Analysis Table 4.2.2 shows how Zara has succeeded in building its brand name and looks into the environmental factors, client needs, competitors and the company’s unique operational strategies that have propelled it to the league of major players in the industry. Through the tabulated analysis, clear understanding of what has built the Zara brand is outlined with its core strategies clearly coming out. Table 4.2.2: Zara Brand development strategies Category Factor Evidence Environment Globalization With fashion acquiring global trends where designs in one part of the world are embraced in continents and nations far away, Zara has taken the challenge of expansion to new markets and opened stores in major world economies. Recent opening of stores in the Bahrain, Jordan, Qatar and Oman are clear evidence of the global nature of fashion because in previously, the Arab world was not receptive to western dressing styles (Roll, 2006). Through expansion, Zara has successful stamped its brand authority as a market leader in the fashion industry by making sure the company’s brand presence is felt the world over. Clients Customer Segmentation The company has managed to successfully develop its customer portfolio with tailored products for Men, women and children. Kiddy’s class stores that are the children’s branch of Zara products came about as a result of this segmentation. Division of clients has enabled Zara to address specific customer needs, an act that has enabled the company to be an all year clothing store and not a provider of seasonal designs (Ghemawat & Nueno, 2003). Meeting unique demands of the various customer segments has further helped Zara establish its brand as a unique fashion house. Competitors Differentiation Zara has chosen to use totally unique strategies from its competitors and this has been key contributor the company’s competitiveness. The following are the unique competitive strategies at Zara: The company is in control its processes from designing, manufacturing to distribution of products. This has been possible by the adoption of just-in-time (JIT ) system that allows the company to vary the crucial manufacturing stages so that products are completed.....refernces are delivered to stores in a matter of days (Finskud, 2009). Zara does not spend any money on marketing and instead directs its resources in opening new stores. This has thrown competitors off and as they focus their energies in adverts, Zara increase its brand visibility through new stores, something that has to this pint worked for the company. By adopting these distinct strategies, the fashion house has built and maintained an inimitable brand name and consistently offered services in a way that is different from other industry players ensuring it remains on top within the fashion world. Company Efficient and unique systems As Zara reduced its product development processes from the industry’s 6 months to just two weeks thanks to its JIT production system, the company has in effect stayed ahead of competition. Spending money on opening stores against advertising has equally enabled the company to improve revenue through actual sales and not mere projections that come with advertising campaigns (Torun, 2007). Given Zara defied the odds and remained in Spain when all major brands were moving to low-cost production areas, the company has earned goodwill of customers in Spain and Europe and positioned it as an employer to the local people as it stamps its brand authorities in these markets. This goodwill has been credited with the large of sales made in Spain annually. Clothes on display at a section of Zara Store in Almere, the Netherlands (Source: zara.com) 4.3 Case Study 2 –H & M 4.3.1 Background Hennes & Mauritz AB, or H&M as it is globally known, is Swedish Fashion Company that company sells women, men, teenager and children clothing and accessories. The company was founded 1947 with its debut store in Vasteras, Sweden. It currently has a market presence in 43 countries with 2320 stores according to the tally at the end of august 2012. It has an employee base of 94, 000 and comes in second after Zara among the largest stores. It recently added home furniture to its portfolio of products. The company has an estimated 800 factories in Europe and Asia though all the production steps are under close supervision and control of the Swedish office (H&M, 2013). The company regularly runs unique marketing campaigns and involves top celebrities to help popularize its brand image. 4.3.2 Data Analysis The table below demonstrates some of the fundamental factors have had an impact in H&M’s brand growth over the years. H&M changed its strategy to come up with various divisions and develop customized products for the identified segment. It has equally changed its image from ordinary to luxury by getting into partnerships that allow the company to co-brand luxury designers (Nawaz & Saleem, 2010). These, together with unique advertising campaigns has positioned the company as the ideal clothing manufacturer of choice and enabled it to experience steady growth in brand worldwide. The motto; “fashion and quality at the best price” has helped H&M attract and keep ordinary customers as it grows into the luxury segment (Black, 2008). Table 4.3.2: H&M Brand development strategies Category Factor Evidence Environment Eco friendly image Fashion industry has lately faced criticism from animal activists and consumers alike on the on its use of animal materials like fur and skin, additionally, environmentalist have extended their campaign on global warming to this industry in their quest to reduce green house emissions. H&M has taken lead in this front by continuously unveiling what It calls; “Conscious” collections that helped project the company as a sustainable player in the fashion industry (Daily News, 2013). With celebrities and the world at large advocating for greener ways of production in the fashion industry, this new eco friendly initiative has helped build H&M image among industry stakeholders. Clients Customer profiling The company has the following segments: Men: This is a more conservative division with designs that have been around for generations and not so many new designs introduced compared to other divisions. Women: The most dynamic segment at H&M with new designs launched most regularly in line with the prevailing fashion trends. Teenagers: Their sense of fashion is guided by happenings in celebrity lifestyles. They therefore embrace more global trends as guided by celebrities making this the second most dynamic after women. Children: This is not a very trendy division with few new designs introduced. Luxury: This segment is built through partnerships with renowned luxury brands and marketed in very unique campaigns. One of the collaborations that have to this date been central to H&M brand strategy has was the 2004 partnership with designer Karl Lagerfeld. Having such profiles enables H&M to come up with separate customize business strategies that help in building the brand image at the division level in the end enabling the overall brand growth (Haberberg & Rieple, 2007). Competitors Unique marketing campaigns Since Zara does not run adverts, H&M has opted for more vigorous marketing campaigns that involve celebrity brand ambassadors like superstar footballer David Beckam for its underwear line and Beyonce for ladies’ clothing. The company has even incorporated music its website with singer-songwriter Lettie’s -“Hang On” as background music for UK the website (Kotler, 2001). The celebrity endorsements and aggressive marketing has helped propel the company’s brand image worldwide Company Central control of processes Having a centralized supervision of the production processes has enabled H&M to keep watch of its quality standards even with the many diverse manufacturing locations. Always keeping to the promised product quality is one of the brand growth pillars of H&M brand in the fashion industry (Dahlén & Lange, 2008). H&M store in Tokyo, Japan: Source: (www.hm.com) 4.4 Case Study 3 – Top Shop 4.4.1 Background Top shop, a company that is part of Arcadia Group, is a UK retailer founded in Sheffield in 1964 with sale of clothing, fashion decorations, shoes and make up as its core business. The company has about 440 stores with a market presence in 37 countries. The company is currently trending with product lines like Glactica and Scandi Military in conjunction with its luxury branch of ‘The Boutique’. The Arcadia Group that Top shop belongs to is owned by British businessman Sir Philip Green that was knitted for his contribution to the growth of fashion industry within the UK. The company is one of the leading brands in the fashion world both in the UK and globally (Topshop, 2013). 4.4.2 Data Analysis The following table take an in depth look at the key contributors to Topshop’s growth a leading brand name in fashion. By examining the company’s environment, Customers, competitors and internal strategies, evidence of unique brand development models will be unravelled and conclusions drawn on the effectiveness of these approaches. In the recent years, the company has worked with renowned fashion industry figures like supermodel Kate Moss to come up with collections that help in building Topshop’s brand image. The 2007 partnership between the company and British artist Stella Vine to produce limited edition products is another way that the company has devised unique strategy to popularize its brand especially amongst the British public. Table 4.4.2: Top Shop Brand development strategies Category Factor Evidence Environment Seeking stakeholder support through charity The company experienced adverse clothing waste when rejected clothes were returned to its stores. To mitigate this, it initiated sales of rejected clothes to ‘jobbers’ with the balance donated to charitable organizations. Doing this is not only saving Topshop from minimal waste but is also projecting the company’s brand in good light with the public. According to topshop.com, the business has between 2010-11 reused 14 tones through this program, making huge savings on possible environmental degradation while changing many lives of needy people (Grant, 2009). The company has also undertaken numerous customer surveys to reduce rejection by sharing customer feedbacks with the manufacturing teams so that final products meet specific customer needs and expectations. Having the production team come up with products that address unique customer needs is the surest way of minimizing rejection. These initiatives have collectively established the Topshop brand name among consumers and industry players further helping the company grow its name beyond the UK borders. Clients Merging diversity in products with personal bonds. The company has spread its product range to optimize on the diverse consumer groups by making Topshop a one stop shop wear not only clothes are sold but accompanying accessories and related fashion products like make are also available. A customer therefore walks into a Topshop store and does not need to visit any other for related products making the company, the consumers’ fashion brand of choice (Clifton & Ahmad, 2009). Besides making the stores umbrella units, the company has initiated a care labeling program where customers are not only directed on how to care for their products in an environmentally friendly manner but are also taken through cloth handling demonstrations at the company’s stores. This enables the company staff to bond with clients and forge personal bonds as well as showing the world that they indeed care for both the customers and the environment. With this set of strategies, the company has secured a place among the top brands and is encroaching to other player’s market share as its name continues to receive recognition. Competitors Consolidating home markets To fight off competition, Topshop has projected itself as a British brand and with the recent inclusion of Kate Moss’s designs in its collections and artist Stella Vine, the company has stamped its position as the British fashion house of choice that not only knows the fashion needs of the British people, but also works with player within the home industry to meet their unique sense of fashion. With the home market share consolidate, Topshop has found it easy to make a name in foreign markets that easily accept the brand because of its appreciation in the UK. Company Keeping to British tradition Topshop has incorporated the British culture of courtesy and attention to detail, elements of the British way of life that are admired globally (Floor, 2006). With such a culture, the company finds acceptance as it moved to open stores in parts of the world that already appreciate its cultural heritage, making the brand conquer foreign markets. 4.5 Case Study 4 – D&G 4.5.1 Background Founded in 1985 and with headquarters in Milan, Dolce& Gabbana is a unique Italian luxury fashion house with a worldwide market presence that targets high end consumers only. It was founded by Domenico Dolce and Stefano Gabbana, all Italians and previously fashion industry employees in Milan. The company has a total of 3,150 employees with stores distributed in all the continents of the world. The company range of products includes luxury clothing, sunglasses, purses and watches. It has recently added make up to its product line at an event graced by Scarlet Johansson, the world famous actress while singer Madonna is to design a collection of sunglasses named MDG, according to the 2010 announcement by the fashion house that also indicated the unveiling of a new perfume line for both men and women. The company presently has a perfume known as ‘The One’ (D&G, 2013). 4.5.2 Data Analysis The following Table 4.5.2, examines how the environment with the growing demand for luxury, D&G target clients, competitors and advertisement strategies have together contributed to the growth of this brand. Through this analysis, a reaffirmation as to why D&G finds room among top fashion brands will be sought and proper conclusions drawn thereof. Table 4.5.2: D&G Brand development strategies Category Factor Evidence Environment New wealth and growing demand for luxury With a growing list of millionaires and luxury brands continuously taking centre stage as a symbol of wealth, Dolce and Gabbana is increasingly positioning itself to feed this growing demand. Emerging economies like China, Brazil and other developing nations that are continuously seeing the rise of millionaires have created an ever growing appetite for luxury that is to the benefit of this fashion house. When D&G opened its first store in Hong Kong, photography on the store was banned for the sole reason that rich Chinese politicians who regularly shopped there did not want publicity (Chadh & Husband, 2006). This generated days of protest and led to a public apology from the Fashion house’s Milan office but served to build D&G as the brand of choice for the rich and powerful (huffingtonpost.com). Clients Using Celebrity influences D&G focuses on the luxury end of the fashion market and to receive attention from this group, celebrity endorsements and inclusion of both designs and collections by these famous people is the key strategy to keeping the luxury image alive. Having Madonna design a line of sunglasses for example, makes not only specific line luxury, but also ads an element of luxury to other sunglasses within D&G not necessarily designed by the superstar (Kapferer, 2012). Competitors Targeting Luxury consumers D&G fights off competition by specifically targeting luxury consumers. This strategy makes sure it does not have to compete for the mass market with other stores like Zara and Topshop which do not have strong luxury segments (Murray, 2003). Company Controversial Adverts D&G has made a name in the fashion industry as the company with the most controversial ads. The 2007 advert above generated a lot of heat from consumer groups and women activists who shared the opinion that the ad was aimed at humiliating women. The other ad that showed models brandishing knives was also heavily criticized. Given the publicity generated by such ads, though negative, and the accompanying growth in brand image after such protests, it appears D&G has mastered the art of reaping from controversial advertisement campaigns. An aspect that is a possible contributor to the growing brand name. 4.6 Case Study 5 – Armani Exchange 4.6.1 Background Known as Giorgio Armani S.P.A., Armani Exchange is an Italian fashion brand founded by Giorgio Armani and dealing in leather goods, eyewear, cosmetics, shoes, home interiors and jewelry among other product lines. The company trades under labels like: Giorgio Armani, Armani Collezioni, Emporio Armani and Armani Junior (Armani, 2003). The company’s estimated sales at the close of 2005 was $1.69 billion and has continued to experience growth both in turnover and brand image. The company targets the youthful segment of the society and comes up with products that match their trendy tastes. The company has recently partnered with luxury hotels to grow its brand with regards to the interior design business. This is in addition to the existing businesses of cafes and nightclubs. 4.6.2 Data Analysis Table 4.6.1 contains an analysis of the strategies that have helped Armani develop its brand to join the league of elite fashion houses. It looks at the environmental aspect of its youthful target market that is continuing to grow \ Table 4.6.1: Armani Exchange Brand development strategies Category Factor Evidence Environment Growing Youth Population Armani targets the youth and with a majority of the world’ population being under the age of 40 years, the brand has realized huge opportunities in existing and new markets. The growth prospects as a result of this demographic change in the business environment coupled with the current convergence of fashion trends around pop culture has enabled a constant growth in Armani’s brand image and presence worldwide (Chadha & Husband, 2006). Clients Rapidly changing hip trends The pop culture has come with very dynamic fashion trends where new designs are introduced in the market every single day and market by famous people. Armani has developed production systems that respond to these rapid changes and this has enabled the company to stay ahead of the market as it meets this unique feature within its target market. Competitors Curving a unique market niche While most of Armani’s competitors either cater for everyone in the market or chose to focus on the luxury segment as is the case with D&G, the company has settled on youthful group with a sense of luxury. This is where most consumers lay from the available demographic statistics and also has the highest number of regular shoppers (Okonkwo, 2007). This positioning has ensured the Armani brand grows with new enthusiasts coming on board everyday resulting into growing brand recognition and sales turnover. Company Trading under different sub-labels The company has divided its product into divisions and trades them under different names. In so doing, Armani focuses on individual division brand growth that finally results in to the development of the mother brand. The kids division therefore focuses in making that segment known as other segments also strive for the same in the end collectively building the Armani brand (Kapferer & Bastien, 2012). 4.7 Cross-case Analyses and Findings The five fashion houses studied have all employed unique strategies in building their brand names with some applying identical approaches but in different directions. H & M and Zara for example have been able to build distinctive value propositions by exploiting communication, positioning, pricing and quality to cement the positive elements of their brands. H & M special emphasizes on co-branding and is currently a market leader on this front (Kendell, 2009). D&G has projected the image of luxury and incorporated marketing strategy that involves celebrities as brand ambassadors while top shop equally invites celebrities but of British descent in efforts to make its brand known (Moore, 2012). These are therefore two fashion houses with the common aspect of celebrity marketing but from two totally distinct perspectives (Tungate, 2008). Armani on the other hand has decided to stick with the youthful segment and meet their dynamism through the adoption of flexible production systems that together ensures the company keeps up with the ever changing trends in this market segment. From the multiple case studies, it’s evident that Brand Awareness is pivotal to the growth of a trademark. The companies discussed have employed diverse brand awareness strategies with some choosing aggressive marketing like is the case with D&G and H&M while Zara opts to create awareness through the opening of stores, individually and jointly, these strategies all serve the function of letting the public know of the existence of a brand. Armani Exchange on the other hand has extensively employed Brand Extension as a strategy in stamping its authority in the market by trading under several names that all collectively represent the Armani brand. Brand equity is also evident in all these companies with each brand meeting the unique needs of a specific customer segment. 4.8 Summary Brand development is a product of several carefully thought out marketing and expansion strategies that together, join to move a company’s name to new markets as it they cement their market shares in captured areas. From the five fashion houses studied above, it has clearly emerged that each company has a unique strategy that is responsible for its standing in the industry (Delagarde & Baykal, 2011). Defying industry norms to move to low-cost production countries and totally eliminating advertisement as seen in Zara for example may be outrageous among industry players, but has served to grow the Zara brand as intended. So are the strategies by all the other four companies that are unique to each of them but all serving to help them achieve their brand growth objectives. Bibliography ARMANI, G. (2003). Giorgio armani. New York: Guggenheim Museum. 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