uniqlo case study

Uniqlo: The Strategy Behind The Global Japanese Fast Fashion Retail Brand

Mention the brand Uniqlo 10 years ago to anyone outside of Japan and you would get a confused look. Mention Uniqlo to any global citizen today and the associations of quality, affordability and fashionable come to mind immediately.

That is how successful Uniqlo has become in recent years. It has become yet another contender in the global fast fashion retail market. Despite having to compete against other bigger players like ZARA (Inditex) , H&M, Gap and Forever21 , Uniqlo has still managed to grow at an astounding pace. How did it manage to capture a share of this competitive fast fashion retail market so quickly?

Some of Uniqlo’s key brand success factors include its unwavering commitment to innovation and its company culture. Its Japanese founder, Tadashi Yanai is famous for his quote “Without a soul, a company is nothing”. This soul is reflected in the 23 Management Principles that Tadashi Yanai has created and indoctrinated in each and every Uniqlo employee. The essence of these principles includes putting customers first, giving back to society and being self-disruptive.

The Uniqlo brand story

In 1972, Tadashi Yanai inherited his father’s chain of 22 men’s tailoring stores, Ogori Shoji in Ube, Yamaguchi. Shortly after becoming company president in 1984, he opened a new store in Hiroshima – Unique Clothing Warehouse, which was later shortened to Uniqlo. His promotion is well-documented as the catalyst for the company’s rapid expansion. Inspired by his travels to Europe and the US, where he discovered large casual apparel chains like Benetton and Gap, Tadashi Yanai saw immense potential for Japan’s casual wear market and set goals to evolve the family’s business strategy from suiting to casual clothing, buying fashion goods in bulk at low cost. Tadashi Yanai also discovered that many foreign fashion chains were vertically integrated, taking control of the entire business process from design to production to retail. By 1998, he had successfully opened more than 300 Uniqlo stores across Japan.

However, one of the main challenges faced was consumer perception of the brand – it was perceived to be a discount retailer selling cheap and low-quality apparel to the suburbs. This perception completely changed when the brand launched the Global Quality Declaration in 2004, a pledge to stop making low-priced, low-quality garments. Since then, people started noticing Uniqlo for its high-quality fleece jackets. The brand perception instantly shifted from being cheap and low-quality, to being affordable but high-quality.

Today, Uniqlo is a wholly-owned subsidiary of Fast Retailing Company Limited and it is known for providing high-quality private-label casual-wear at low prices. As of September 2019, the brand has grown to more than 2,250 stores in 25 countries across Asia, Europe and US in just a matter of 22 years. It is the biggest apparel chain in Asia with over 800 retail stores in Japan alone.

Fast Retailing’s market capitalization is over USD 49.2 billion and it employs more than 56,000 people globally. For the year ending 2020, Fast Retailing had revenues of USD 22 billion and a profit of USD 2.5 billion. The company’s home market Japan contributed 38 percent to its total revenue, with one in four Japanese said to own a Uniqlo down jacket. Fast Retailing has been growing at an incredible rate in the past 5 years and its confidence is reflected in its revenue forecast of 9.5% growth for FY2021.

According to global management magazine Forbes, Uniqlo has a brand value of USD 9.2 billion and is 84th on the list of the World’s Most Valuable Brands. Much of it is credited to its founder’s strategy of innovation and its very customer-centric culture.

Uniqlo aims to be the world’s largest mass clothing retailer, based largely on expansion in US, China and online. It is slowly catching up with global fashion giant H&M’s market share, whose 2019 revenues stand at USD 24.3 billion. If Uniqlo achieves this ambitious target, it will dethrone Inditex ( Zara ’s parent company) as the leader in global apparel.

The Uniqlo brand strategy

Uniqlo’s brand message encapsulates a clear vision: “Uniqlo is a modern Japanese company that inspires the world to dress casual”. The corporate strategy that has worked for Uniqlo so far is to “totally ignore fashion” instead of chasing fast-fashion trends like its other competitors. The brand philosophy “Made for All” positions its clothing to transcend age, gender, ethnicity and all other ways to define people. Contrary to its name “Uniqlo”, its clothes are simple, essential yet universal, enabling the wearers to blend them with their individualistic style.

This design driven clothing brand offers unique functional performance owing to in-house fabric and design innovation. The company distinguishes itself from its price driven competitors by branding its signature innovations with names like HeatTech, LifeWear and AIRism. Uniqlo provides a superlative physical shopping experience by impeccably managing its stores, inculcating a positive employee culture and through in-store technology like video tutorials that describe product attributes.

Some of the key brand success factors for Uniqlo include the following:

Delivery system supporting a clear brand promise: Two of the biggest challenges for any brand is to define a clear brand promise and to consistently deliver effectively on its brand promise across all touch points of the customer experience journey. Successful brands are those that create supportive organizational and operational structures that facilitate the implementation of strategies to deliver on the brand promise. On one hand, Uniqlo has indeed managed to successfully define a clear brand promise for itself to provide high quality, performance-enhanced, universal, basic casual wear at affordable prices. On the other hand, it has also created a strong delivery system to deliver on this brand promise.

The company’s product planning, design, manufacturing and distribution capabilities are all in-house, which means that it is able to stay close to customer needs based on what customers are buying in their stores, allowing them to save costs on overproduction or unnecessary overheads. Stocks can be upgraded within a matter of weeks or replenished within a matter of days. By focusing on core products in a limited range of fabrics, Uniqlo is able to consolidate its fabric buys into huge orders that give it greater negotiation power against suppliers which translates into cheaper prices for its customers – serving its brand promise well.

Product development approach and efficient supply chain: Tadashi Yanai is fond of saying that “Uniqlo is not a fashion company, it’s a technology company.” And indeed, the brand’s approach to making apparel has more in common with the iterative approach to product development embraced by the technology industry than the cyclical, trend-driven rhythm of the fast fashion retail industry. While leading competitor Zara has built the world’s largest apparel business based on rapidly responding to fast-changing fashion trends, getting items from factory to store in approximately two weeks, Uniqlo takes the exact opposite approach, planning production of its wardrobe essentials up to a year in advance. Unlike its competitors who sell a large variety of trendy fashion inspired by the global runway, Uniqlo focuses on producing a few styles of urban practical basics.

The company also runs a highly robust supply chain. Through development of a detailed marketing strategy by the marketing department for each season, merchandisers are able to adjust production by style to align with demand well in advance. Concept meetings with all key product creation teams are held about a year before a product is launched. Once a garment is in production, about 400 skilled staff members visit production centers to ensure quality and resolve outstanding issues.

The Uniqlo global production centers are located in Shanghai, Ho Chi Minh City, Dhaka, Jakarta and Istanbul.

Customer concerns are also addressed by the production department which keeps the product teams plugged into what the end consumer thinks, as product and marketing teams work closely together around strategy and execution.

Company culture and visionary leadership: In 2019, Tadashi Yanai was ranked number no. 54 on the list over the best-performing CEOs in the world by Harvard Business Review. Since 2000, he has provided a 700 percent shareholders return, and the market capitalization of Uniqlo has increased USD 39 billion. He is credited widely for the huge success and explosive growth of Uniqlo in the past 36 years due to his creation of a strong company culture which focused on teamwork and customer experience.

Uniqlo’s focus on teamwork is demonstrated through its flat organizational structure with employees greatly encouraged to provide suggestions. The values and goals of the company are translated directly into processes and measures exhibited strongly by employees all over the world. Company financials are completely transparent to employees and sales and charted and posted daily. The brand also places a huge emphasis on its retail store experience and micromanages every customer touch point.

Staff training is a huge priority for the company as each new employee is trained for a remarkable 3 months – way above global industry average. Every activity undertaken by its employees are recorded and analyzed – from apparel folding technique, to the way retail staff returns credit cards to customers with both hands and full eye contact. Employees are also taught to interact with shoppers using six standard phrases including “Did you find everything you were looking for?” and all customers are welcomed with “Welcome to Uniqlo!”.

In 2000, the company built a Uniqlo University in Tokyo in which 1,500 new store managers are trained every year.

One example showcasing Uniqlo’s focus on the customer experience is Tadashi Yanai’s decision to conduct all operations in English in 2012 – a decision considered rare in Japan. This has contributed to its global success and is something other aspiring global companies can learn from. In addition, Uniqlo employees constantly look to improve their internal processes and consequently the customer experience. In 2004, Uniqlo opened its first large-format store (over 2,000 square metres in size) in Osaka after observing its competitors Zara and H&M do the same, leading to an improvement in customer satisfaction and profitability. The Uniqlo Customer Center also uses customer feedback to constantly improve its products.

High dedication to innovation: As Peter Drucker said, innovation and marketing are the only two functions of any organization. Uniqlo understands this well – the brand is well-known for its fabric innovations. The company also hires Japanese textile masters called “Takumi”, who work closely with factories in China and Japan to continually develop new high-tech fabrics for Uniqlo.

One of Uniqlo’s signature innovations is HeatTech, a fabric developed in conjunction with Toray Industries (a Japanese chemical company) that turns moisture into heat and has air pockets in the fabric to retain that heat. The HeatTech fabric is thin, comfortable which has enabled the brand to create stylish designs which are very different from the standard traditional warmth clothing segment. The HeatTech innovation keeps improving over time with new fiber technology, allowing the brand to come up with different collections of thermal clothing. In 2003, 1.5 million HeatTech products were sold while in 2012 over 130 million units were sold across 250 items.

Besides HeatTech, Uniqlo has also created AIRism (a soft fabric with quick-drying inner fabric), LifeWear (a blend between casual and sportswear) and UV Cut (material designed to prevent 90% of ultraviolet rays from reaching the wearer) technologies. These new fabrics are all branded and copyrighted, which poses a struggle for competitors who want to try and attempt to match this point of differentiation. Tadashi Yanai has been quoted to say that Apple is its largest competitor because of the company’s desire to be the most innovative company in the world.

Uniqlo brand architecture

Uniqlo caters apparel to mainly 3 customer segments: Women, Men and Kids & Babies. The brand is divided into five sub-brands separated by style but housed under the same Uniqlo store, within which Uniqlo showcases its collections:

Outerwear: Uniqlo’s outerwear comprises of jackets and coats of different styles and materials, hoodies and parkas to suit different weather conditions and occasions, and the famous Ultra-Light Down jacket that is extremely thin, light, and comfortable but yet provides excellent insulation and warmth.

Tops: This category includes functional and comfortable dresses, shirts, wrinkle-resistant blouses, t-shirts and UT (Graphic t-shirts) for women made from a variety of materials. Sweaters and cardigans are also included, with most styles made with the brand’s signature UV Cut material or its soft and luxurious Cotton Cashmere. For men, it includes formal and casual shirts in a variety of fits, t-shirts, UT, sweaters and cardigans, and flannel. Its range of polo t-shirts are made in 2 different materials: AIRism and Dry Ex (extra breathable mesh in a seamless construction).

Bottoms: This category for women includes shorts and skirts to suit all lifestyle needs, jeans that come in a variety of cuts, leggings (including maternity leggings), smart pants, ankle pants, casual pants and lounge bottoms. Its men’s bottoms include smart pants, shorts, jeans, ankle pants, casual pants, lounge bottoms and its most recent innovation – the Kando pants, a new lightweight, stretchable and fast-drying material with Airdots pockets. In line with its brand mission to celebrate individuality, Uniqlo offers free alteration services for pants that cost above a certain amount.

Inner-wear : Uniqlo has designed its inner-wear with comfort as a predominant focus. For women, this includes bras, bra tops, inner tops, shape wear, shorts and underwear, socks and leg-wear, and HeatTech (Regular, Extra Warm, and Ultra Warm). For men, this includes inner tops, trunks, boxer briefs and briefs, socks and leg-wear, and HeatTech.

Home wear  & Accessories: Uniqlo’s home wear & accessories category includes lounge wear (pajamas, lounge pants, drape pants and room shoes), shoes (sneakers, flats and heels), belts and other accessories including bed sheets, gloves, hats, caps, scarves, sunglasses, bags, towels, blankets and its most recent addition, the AIRISM face masks.

Uniqlo brand communication strategy

Until the digital age started to gain rapid global momentum, Uniqlo has traditionally relied on marketing flyers and TV commercials as its primary means of advertising. Today, it uses a plethora of methods to communicate its brand position and ideals, including its unique in-store environment, celebrity brand ambassadors (called Uniqlo Global Ambassadors), digital marketing, collaborations with designers and brand campaigns.

In-store environment: One of Uniqlo’s main brand communication methods is its in-store environment. Through its wide aisles, bright lights, neatly stacked shelves and beautifully presented displays creating a comfortable and welcoming shopping experience, Uniqlo communicates its ideal of simplicity and essential basics. Although the brand intentionally limits the number of designs it produces, it compensates for this and distracts consumers from the lack of choice by stacking its apparel from floor to ceiling, creating an illusion of choice and plenitude.

It also has many digital screens in-store explaining the practical benefits of its fabrics and apparels. Compared with other fast fashion competitors whose stores are jam-packed with clothes, lack order and do not have a specific focus on customer service, Uniqlo’s in-store experience stands out and contributes heavily to effective communication of its brand philosophy.

Uniqlo Global Ambassadors: Similar to many global brands, Uniqlo also uses celebrity endorsements to extend the brand’s image and connect with the masses. For Uniqlo, the most important attributes it looks for in its brand ambassadors are great resilience and strong character to overcome adversity. Uniqlo currently has 6 Global Ambassadors:

• Japanese international snowboarder Ayumu Hirano
• Swiss professional tennis champion Roger Federer
• Japanese global tennis medalist Kei Nishikori
• Japanese international wheelchair tennis champion Shingo Kunieda
• Scottish international wheelchair tennis champion Gordon Reid
• Australian world-class pro golfer Adam Scott

The Uniqlo Global Ambassador partnership typically lasts for 5 years with the aim of having the ambassador promote the Uniqlo brand and its clothing worldwide, as well as collaborating on future product lines and co-developing functional wear.

Digital marketing: Being one of the first brands to successfully launch the digital marketing campaign ‘Uniqlock’ back in 2007, Uniqlo is definitely one of the forerunners to use this brand communication channel. The viral marketing project, designed to build brand awareness internationally, featured a clock with spliced clips of well-choreographed dancing and catchy lounge music all timed to match the ticking. It ran all year round – in summer, the girls dancing wore polo shirts; in winter, cashmere; and at midnight they slept.

The web tool, Uniqlock, was designed to include a blog widget so the clock could be embedded into blog sites. By January 2008, more than 27,000 widgets from 76 countries were circulating, and the widgets and website that accompanied the campaign had been viewed 68 million times in 209 different countries. Uniqlock won the brand a multitude of major advertising awards, including a Grand Prix at Cannes Lions Festival. Dasuke Hase, Uniqlo’s public relations and global marketing communications spokesman explained that the campaign was all about communicating with customers in a way that travels around the globe.

More recently, the brand’s 2019 international campaign #UTPlayYourWorld also followed in Uniqlock’s footsteps, partnering with short-form video giant TikTok to encourage customers to show off their Uniqlo UT range outfits in short videos, which are screened on in-store monitors.

Collaborations with designers: In line with its brand promise to highlight each individual’s unique individual style, Uniqlo collaborates with designers to create unique styles. Although this brand communication channel was arguably made famous by competitor H&M, Uniqlo has proven that it started its own designer collaboration strategy since 2008 when it tapped designer Alexander Wang to create a five-piece dress collection. By collaborating with global designers, Uniqlo is also able to gain quicker access into markets where it has a weaker brand awareness, like the US and European markets.

Here are some notable collaborations that Uniqlo has done in recent years:

• Jil Sander’s “+J”: This collection debuted in 2009 and lasted for five seasons. This collection includes quality tailored basics for formal and smart wear
• Theory’s “T Down”: This collection was introduced in Fall/Winter 2012. A collaboration between New York’s contemporary label Theory and Uniqlo, pieces boasted color-blocked neutrals of darker color palettes with styles including the Banff Classic Puffer Vest and Big Sky Classic Puffer Jacket
• Undercover’s “uu”: In 2011, this collection was launched as a family-friendly collection with lines for men, women and children at very accessible price points. For Undercover, it proved beneficial as it allowed consumers who could not afford Undercover apparel to own the designer’s designs. This collection was revived in 2014 solely for children’s wear
• NIGO’s “UT”: Graphic t-shirt designer NIGO had left his own label A Bathing Ape in 2013 to become Creative Director of Uniqlo’s UT line. UT is known for its endless collaborative T-shirt collections, including names such as Pharrell Williams, Medicom Toy, Andy Warhol, and Disneyland
• Lemaire’s “Uniqlo U”: Uniqlo has partnered with Paris designer Christophe Lemaire since 2016 to design flexible and versatile pieces that for everyday wear under the Uniqlo U line and lead Uniqlo’s Paris R&D Center. In July 2018, Christophe Lemaire was reported to have extended his contract with Fast Retailing for another 5 years. Uniqlo has also announced its acquisition of a minority stake in the Paris-based label, deepening its relationship with Lemaire. This will allow Uniqlo to leverage on Lemaire’s apparel design expertise and creative talent network
• Uniqlo x Marimekko: Launched for Fall/Winter 2020, Uniqlo has partnered with Finnish fashion company Marimekko known for its bright colours and prints. The limited edition holiday collection evokes the warmth and coziness of being home with family and friends

Global brand campaigns: Although it has been a while since the Uniqlo brand has gone international, it was only in 2016 that Uniqlo launched its first global brand campaign titled “The Science of LifeWear” (Uniqlo has launched local and regional campaigns previously but none were truly global). In the series of videos introducing the brand and its collections (Jeans, Jogger pants, Ultra-Light Down, Knitwear and HeatTech), Japanese streets-capes unwind in slow motion, and people walk on streets wearing simple but chic clothes. A narrator starts in with questions: “Why do we get dressed? Do you choose based on your mood or the weather? Do you dress to fit in? Do you want to fit in?” It finally ends off with “There is no one answer. But to make clothes for life, we’ll keep asking.”

This unusual, philosophical way of introducing the brand is edgy and helps solidify Uniqlo’s relentless commitment to quality, functionality and style through LifeWear. Mr John C. Jay, Uniqlo’s President of Global Creative says that the campaign is an opportunity to present the brand’s mission and its Japanese heritage, which differentiates it from the competition, and to harmonize its brand image internationally. It represents an important next step for Uniqlo in its ongoing mission to become a truly global and inspirational apparel brand.

Going forward, the brand wants to foster closer two-way communication with customers. Uniqlo has committed to use the information collected through its website and mobile app to analyze customer data and provide them with information that best suits their individual needs. Additionally, Uniqlo needs to adopt, imbibe and leverage social media and digital platforms in its advertising and communication strategies deeper going forward.

Uniqlo’s global sustainability approach

Sustainability has been a hot topic in business for the last decade and is now quickly becoming a must-have hygiene factor for companies that want to resonate with and win the loyalty of its global customers.

One of Tadashi Yanai’s 23 Management Principles is to contribute back to society. The brand strongly believes that company’s value is intrinsically linked to the value it brings to society as a whole and that successful companies must serve society. It believes that companies that only focuses on profit will not survive. Its corporate statement “Changing clothes. Changing conventional wisdom. Change the world.” reflects the company’s desire to transform society and enhancing the environment and lives of all its stakeholders.

Fast Retailing’s sustainability approach and efforts comprise of 6 pillars:

• Create New Value through Products and Services: By procuring raw materials responsibly with concern for animal welfare, the environment, and cotton farmers, Fast Retailing strives to produce clothing which are sustainable even after they are no longer worn
• Respect Human Rights in Our Supply Chain: Fast Retailing forms strong partnerships with supplier factories and requires them to comply with its Code of Conduct for Production Partners to safeguard human rights and working conditions in our supply chain. Its Responsible Procurement Policy also requires production orders to be made following procedures to avoid sudden increases in production volume that would result in excessive overtime hours at its partner factories
• Respect the Environment: Through stakeholder collaboration and technological innovation, Fast Retailing is committed to eliminating waste in its operations and supply chain. It is committed to reduce water use by 15% and greenhouse gas emissions in its Uniqlo stores by 10%, by 2020
• Strengthen Communities: Fast Retailing supports communities in three ways – communities where it operates its stores, communities surrounding its partner factories, and communities providing shelter to refugees and displaced persons. In fiscal year 2018, 30.29 million items were donated to 65 countries and regions through its All-Product Recycling Initiative
• Support Employee Fulfillment: Fast Retailing has established an Employee Engagement Policy with three pillars: equal opportunity and diversity; education and development; and healthy, secure, and safe workplaces. Almost every Uniqlo store in Japan hires at least 1 staff member with disabilities, and is targeting to even the employee gender ratio after achieving its goal of filling 30% of its management roles with women in 2018
• Corporate Governance: Fast Retailing strives to build an effective corporate governance system based on its Code of Conduct which includes a corporate auditor governance model to enhance the independence of its Board, and an executive officer system to enable timely decision-making and operations

These 6 pillars demonstrate Uniqlo’s commitment to give back to society through various initiatives.

Uniqlo’s future brand and business challenges

Despite its huge success so far, Uniqlo faces its own global business challenges. As noted above, the brand takes a very different strategy from its fast fashion competitors like Zara , H&M and Gap. What are some of the strategic business considerations Uniqlo needs to have in mind in its strive to be the world’s top apparel retailer?

Differentiation through innovation: It has not been all plain sailing for Uniqlo. Its biggest dilemma is probably brand differentiation as it tries to be “everything for everyone” – a known brand strategy mistake. However, Uniqlo has managed to take the focus off the ubiquity of its products by emphasizing its innovations in the fabrics. Although Uniqlo has already made a name for itself in the industry for its innovative fabrics, it needs to treat itself as its biggest competitor and continually think of ways to outdo itself. Innovation is therefore a key factor that will strongly influence the future of the Uniqlo brand.

Focus more on quality, less on price: For Uniqlo to effectively compete and maintain its strategic advantage and differentiation, the focus needs to shift away from price but towards quality. Even though Uniqlo enjoys high levels of appeal, evident by the serpentine queues outside its stores when it launches in new markets, there is still a need for Uniqlo to start investing in building a strong brand positioning on the quality of its apparels and aggressively communicate this.

Leveraging on digital: Fast Retailing has announced that it is making progress on its Ariake Project, which aims to transform the apparel retail industry into a new digital consumer retail industry. It is building a supply chain that uses advanced information technology to create seamless links between Fast Retailing and its partner factories, warehouses, and stores worldwide. While this is a commendable digital supply chain effort and reflects how the company has comprehensively thought about how to leverage digital internally, it is also important to remember the customer focus. Today, people of all ages use the Internet and this is transforming the way consumers shop.

Uniqlo first ventured into e-commerce by launching its online store in the US in 2012. Since then, it has launched its online stores across Southeast Asia. Uniqlo understands that it needs to integrate its physical stores and virtual stores, and create a true omni-channel experience. Online sales currently account for 9.9% of Uniqlo’s total global sales and the brand aims to expand this to 30% by launching more online services.

Different forms of market analysis strongly point towards a scenario wherein spending on mobile commerce will overtake e-commerce in the next 3 years. The Chinese fast fashion apparel market is a testament to that. On an average, most brands get about 15-20% of their website traffic via mobile devices and this is growing rapidly. Uniqlo has proved to be at the forefront of the technology trend as it launched its first mobile app in 2014 in Singapore, its regional Asia commercial hub. With a clean, informative and user-friendly interface, the brand has done a good job in allowing consumers the convenience of buying their products on the go. However, there were some unfavorable reviews on its post-purchase experience. Uniqlo needs to consider the entire online customer journey from pre- to post-purchase, in order to make mobile shopping not only an effortless experience but also a delightful one. In addition, the brand needs to gather retail analytics in order to analyze digital consumer patterns and devise strategies to improve its sales in its digital channels.

Next generation ownership: With the intense and multi-faceted technological and business disruptions taking place over the past decade, leadership in the 21st century will be influenced by constant change, geopolitical volatility, and economic and political uncertainty. Tadashi Yanai once thought he would retire from day-to-day operations by the time he was 60, but at the age of 70, he still holds the company’s operational reins as chief executive. To effectively manage the above leadership disruptions, Uniqlo needs to quickly devise a succession plan and instill a next generation leadership team .

Despite Uniqlo’s global reach and product standardization, it still needs to constantly find new ways to serve local fashion needs and preferences of its consumers across the globe. This will be a challenge for the brand’s leadership in the next decade.

Global competition: Uniqlo comes in third in global ranking of fast fashion retailers with sales of USD 22 billion, just behind Spain’s ZARA (sales of USD 33.7 billion) and Sweden’s H&M (sales of USD 24.3 billion). Nonetheless, Uniqlo’s quick growth in recent years has seen it overtaking America’s Gap (sales of USD 16.4 billion), who has been long dominant in basic wear. Looking ahead, there is indeed a lot that Uniqlo needs to do to meet its ambitious goal of being the world’s largest fast fashion retailer, but it is without doubt on track to challenge the global players in the fashion retail industry.

International expansion: When a brand starts to gain popularity in its country and region, the next natural step would be to look to expand globally. This is especially so for Uniqlo, but the brand has met with considerable challenges. Up till now, the brand footprint and awareness are relatively low outside of Asia, something the company is tackling through global retail store expansion programs, advertising and marketing. In its products, notable differences between global customer groups have been overlooked and Western consumers often complain about its clothes size and fit to body shape. To tackle this, Uniqlo has started partnerships with Western designers like Christophe Lemaire and launching collections like the Uniqlo U line.

In terms of non-organic growth, the brand has its own share of acquisition talks. In 2012, its first step to penetrate the US market saw Fast Retailing paying USD 290 million for J Brand, a California-based denim firm. In 2004, it purchased Theory, an affordable luxury brand which is quickly developing into a one billion dollar business.

More recently, Uniqlo had wanted to enter into a merger with J Crew Group in 2014, but the company eventually pulled out of the deal due to the hefty USD 5 million price tag. Run by well-known executive Mickey Drexler, J. Crew is a multi-channel retailer and distributor of women’s, men’s and children’s apparel, shoes and accessories, and has deep expertise about the retail infrastructure in the US, The deal would have given Uniqlo access to 400 stores in the US. Moving forward, Uniqlo needs to be very focused in its international expansion strategy with clear and achievable plans tailored to each market.

With profits declining due to margin erosion over the years and an impairment charge on J Brand premium denim clothing, international operations are getting increasingly important for Uniqlo to sustain its profitability. It is looking at specifically targeting the US and China markets. Currently, Uniqlo only has a few stores in the US but its brand popularity is steadily increasing due to its bold and clear colors design aesthetic, and value-for-money cashmere products.

Conclusion: Uniqlo’s runway to become a global Asian brand is massive

The Uniqlo brand was set up to be all about the Japanese philosophy of simplicity and essentiality, and this is reflected throughout the brand’s marketing, communications, and operations. It is indeed impressive how Uniqlo has managed to transform from a single inherited men’s tailoring shop from Tokyo into a global casual wear giant and one of the most impressive brands from Japan and Asia today. Under Tadashi Yanai’s effective and visionary leadership, Uniqlo’s parent company Fast Retailing targets to become the world’s largest fast fashion retailer.

One of the secrets behind Uniqlo’s success is its strong delivery system supporting a clear brand promise, and its relentless commitment to innovation. By clearly defining its brand promise to provide high quality, performance-enhanced, universal, basic casualwear at affordable prices and by running a robust and efficient supply chain to produce its apparel, the brand has created an environment where it continually exceeds customers’ expectations.

Building and sustaining a brand that is relevant and one that resonates with the customer base is one of the most difficult aspects of building a strong brand today. Uniqlo, with its presence in diverse markets, has managed to hold up well to this challenge of building a relevant and resonant brand personality.

There are indeed many opportunities that Uniqlo can leverage in order to reach its goal of becoming the largest global apparel retailer. In particular, the company plans to focus on growing Uniqlo internationally and expanding online sales. With Uniqlo’s impressive company culture, bold and daring leadership, and proven consistent financial growth in the past 15 years, it is no doubt that the Japanese fast fashion retail brand is on the right path to global success.

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About the author:  Martin Roll – Business & Brand Strategist

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Uniqlo Marketing Strategy 2024: A Case Study

Uniqlo, a subsidiary of Fast Retailing, has successfully established its presence in the retail industry over the past four decades. With its origins as a men’s clothing retailer, Uniqlo expanded internationally, opening its first overseas store in London back in 2001. Today, Uniqlo operates as the largest clothing retailer in Asia, all thanks to its effective marketing strategies.

Uniqlo’s marketing approach revolves around several key elements. Firstly, the brand invests heavily in product development, ensuring that its offerings remain competitive, innovative, and aligned with market trends . Secondly, Uniqlo utilizes its products as a platform for marketing and brand awareness, showcasing the exceptional quality and functionality inherent in each garment.

In terms of customer experience, Uniqlo leaves no stone unturned. The brand places great emphasis on in-store training, ensuring that its staff delivers exceptional customer interactions and greetings consistently. Uniqlo also understands the importance of creating a welcoming and positive atmosphere for shoppers, providing an immersive and enjoyable retail experience.

Uniqlo has also made sustainability a focal point of its marketing strategy. With its LifeWear clothing line, Uniqlo offers reasonably priced and durable garments, promoting responsible consumption and encouraging customers to extend the lifespan of their purchases through repair services. Additionally, the brand has launched ECO Bags as part of its commitment to reducing plastic waste.

The integration of e-commerce into Uniqlo’s marketing efforts cannot be overlooked. The brand recognizes the significance of digital channels in influencing customer behavior and making purchase decisions. By leveraging the power of digital marketing , Uniqlo not only drives online sales but also enhances the overall customer experience.

Key Takeaways:

• Uniqlo focuses on product development, using innovative designs that align with market trends.
• Customers experience exceptional service through in-store training and a welcoming retail environment.
• Sustainability is a key aspect of Uniqlo’s brand strategy, promoting responsible consumption and reduced waste.
• The brand leverages e-commerce to drive sales and enhance the overall customer journey.
• Uniqlo’s marketing success is attributed to its combination of innovative products, inclusive branding, and engaging digital marketing campaigns .

Uniqlo’s Product as a Marketing Platform

Uniqlo understands the power of using its products as a platform for marketing and raising brand awareness. One of their most notable achievements in product development is the creation of their flagship clothing line, HEATTECH, in collaboration with Toray Industries.

HEATTECH garments are made with advanced materials that generate heat and provide exceptional warmth, even in the coldest of temperatures. Uniqlo continuously strives to innovate and improve its HEATTECH line by offering even warmer versions of the product, revolutionizing the way people dress for winter.

The success of Uniqlo’s product development strategy can be attributed to their commitment to creating clothing that appeals to a wide range of customers. By offering functional and high-quality garments like HEATTECH, Uniqlo has established itself as a go-to brand for stylish and practical clothing options.

Uniqlo’s collaboration with Toray Industries for the development of their HEATTECH line showcases the brand’s dedication to innovation and utilization of cutting-edge materials and technologies. Through this strategic partnership, Uniqlo not only enhances the quality of their products but also strengthens their brand image as a leader in functional clothing.

Experiential Marketing and Customer Experience Excellence

Uniqlo understands the importance of providing an exceptional customer experience and invests in experiential marketing and in-store training to achieve this goal. By creating memorable moments and implementing consistent customer interactions, Uniqlo aims to create a positive and welcoming retail experience for shoppers.

As part of its marketing strategy, Uniqlo launched a digital billboard campaign that encouraged participants to take photos and uncover unique codes to receive discounts. This experiential marketing approach not only generated excitement and engagement but also increased brand awareness and drove customer traffic to Uniqlo stores.

Uniqlo also places great emphasis on in-store training to ensure that its staff delivers a consistently high level of service. Through comprehensive training programs, Uniqlo employees are equipped with the necessary skills to provide personalized assistance and make every customer feel valued.

The brand’s commitment to delivering a remarkable retail experience extends to all its locations, with a focus on creating a consistent atmosphere that aligns with Uniqlo’s values and aesthetic. Whether customers visit a Uniqlo store in New York or Tokyo, they can expect the same welcoming ambiance that is synonymous with the brand.

To further enhance the customer experience, Uniqlo continuously seeks feedback and looks for opportunities to improve. By listening to its customers and implementing their suggestions, Uniqlo ensures that it remains at the forefront of delivering a retail experience that exceeds expectations.

Benefits of Uniqlo’s Experiential Marketing and Customer Experience Excellence:

• Increased brand awareness through engaging digital campaigns
• Encouragement of customer participation and interaction
• Consistent and personalized customer service through in-store training
• Creation of a welcoming and consistent retail experience across locations
• Continuous improvement based on customer feedback

Marketing Sustainability in a Fast-fashion World

Uniqlo is committed to promoting sustainability in the fast-fashion world through its innovative initiatives. One of their key strategies is the Uniqlo LifeWear clothing line, which focuses on providing customers with reasonably priced and durable clothing designed for long-term use. By creating sustainable wardrobe staples, Uniqlo encourages responsible consumption and reduces the impact of the fashion industry on the environment.

An integral part of Uniqlo’s sustainability efforts is their RE.UNIQLO Studio , where they offer repair services for garments. This unique service allows customers to extend the lifespan of their clothes by repairing any damage rather than discarding them. By promoting repairability, Uniqlo aims to minimize the amount of clothing that ends up in landfills and contributes to the growing issue of textile waste.

In addition to repair services, Uniqlo has launched ECO Bags as part of their commitment to reducing plastic waste. These reusable bags are designed to promote a sustainable lifestyle by offering an alternative to single-use plastic bags. By encouraging customers to bring their own bags, Uniqlo aims to reduce plastic waste and contribute to a greener future.

To provide a comprehensive understanding of Uniqlo’s sustainability efforts, the table below highlights the key initiatives undertaken by the brand:

Uniqlo’s sustainability initiatives demonstrate their commitment to reducing the environmental impact of the fashion industry. By promoting conscious consumption, repairability, and reducing plastic waste, Uniqlo connects with customers who prioritize sustainable choices. These efforts align with Uniqlo’s broader marketing strategy, which emphasizes the importance of sustainability and responsible business practices.

E-commerce as a Marketing Channel

Uniqlo recognizes the growing importance of e-commerce as both a business platform and a valuable marketing channel . In today’s interconnected world, customer touchpoints have become more diverse than ever, with online and offline interactions influencing purchasing decisions. Uniqlo leverages this synergy between e-commerce and physical stores to enhance the overall customer experience and drive sales.

With the rise of online shopping, Uniqlo has established a robust e-commerce presence through its online store. Customers can browse and purchase Uniqlo’s diverse range of products conveniently from anywhere, at any time. The online store serves as an extension of the physical stores, ensuring a seamless shopping experience for customers.

Uniqlo understands that the integration of e-commerce and physical stores is vital in the current retail landscape. Rather than viewing e-commerce as a separate entity, Uniqlo embraces the concept of synergy between online and offline channels. By leveraging digital marketing strategies , Uniqlo not only drives online sales but also successfully increases foot traffic and sales in its physical stores.

The brand recognizes that customers often research and explore products online before visiting a physical store to make a purchase. By utilizing e-commerce as a marketing channel, Uniqlo can capture potential customers’ attention, generate interest, and ultimately drive them to visit a physical store for a more immersive shopping experience.

Benefits of Uniqlo’s E-commerce and Physical Store Synergy:

• Increased brand visibility and accessibility through an online presence.
• Seamless shopping experience for customers across different channels.
• Improved customer engagement and loyalty through integrated marketing efforts.
• Opportunities for cross-promotion between e-commerce and physical stores.
• Enhanced data collection and analysis for better understanding customer behavior.
• Higher conversion rates as online interactions influence in-store purchases.

Uniqlo’s approach to e-commerce as a marketing channel exemplifies its commitment to providing a holistic and integrated shopping experience for customers. By embracing the power of digital marketing and leveraging the synergy between e-commerce and physical stores, Uniqlo solidifies its position as a leader in the fashion retail industry.

Collaborations as a Growth Strategy

Uniqlo has successfully utilized collaborations as a strategic approach for growth. By partnering with global ambassadors like Roger Federer and Adam Scott, as well as various groups and designers worldwide, Uniqlo has been able to expand its reach and tap into different audience segments. These collaborations not only strengthen Uniqlo’s brand image but also attract new customers who are influenced by the association with influential personalities and designers.

Uniqlo’s collaborations transcend traditional marketing tactics and create unique opportunities to engage with consumers on a deeper level. By merging their expertise and aesthetic sensibilities with Uniqlo’s mission, these collaborations result in special collections that resonate with diverse consumer preferences. Whether it’s a limited-edition athletic wear line designed by a renowned athlete or a fashion-forward collection developed in collaboration with a celebrated designer, consumers are drawn to the exclusivity and uniqueness of these partnerships.

Through collaborations, Uniqlo is able to leverage the influence of global ambassadors and renowned designers to expand its brand presence across the globe. These collaborations not only generate excitement and buzz around Uniqlo’s products but also provide opportunities for the brand to showcase their commitment to innovation and creativity.

Uniqlo’s collaborations have proven to be a powerful growth strategy, enabling the brand to extend its reach and attract new customers. By constantly seeking out new partnerships that align with their brand values and aesthetic vision, Uniqlo remains at the forefront of fashion collaborations, setting trends and captivating consumers around the world.

Uniqlo’s Unique Marketing Proposition

Uniqlo differentiates itself in the fashion industry through its unique selling proposition of functional clothing with minimalist aesthetics. The brand’s commitment to creating high-quality basics that are both practical and accessible sets it apart from competitors.

Uniqlo understands that today’s consumers prioritize functionality and simplicity in their fashion choices. By offering functional clothing, Uniqlo caters to the needs of individuals who value comfort and versatility.

Furthermore, Uniqlo’s minimalist aesthetics align with the current trend of embracing simplicity and timeless style. The brand’s clean design and focus on essential wardrobe staples resonate with fashion-conscious consumers.

Uniqlo’s functional clothing and minimalist aesthetics contribute to its strong brand image. The brand is known for delivering reliable and durable products that meet customers’ everyday needs.

With a wide range of functional options, such as moisture-wicking fabrics, stretchable materials, and heat-generating technologies, Uniqlo ensures that customers can find clothing suitable for their specific requirements.

Ultimately, Uniqlo’s unique marketing proposition lies in its ability to combine functionality, accessibility, and minimalist aesthetics, providing customers with high-quality basics that effortlessly integrate into their everyday lives.

Uniqlo’s Functional Clothing Features

Uniqlo’s extensive product lines.

Uniqlo, known for its commitment to quality and innovative designs, offers a diverse range of clothing lines that cater to various customer needs and preferences. Let’s explore some of Uniqlo’s popular product offerings:

1. Uniqlo HeatTech

Uniqlo’s HeatTech line is a perfect choice for those seeking warmth and comfort during the colder months. HeatTech clothing utilizes advanced technology to provide exceptional insulation by absorbing moisture and generating heat. This line includes a wide range of products such as tops, bottoms, and accessories, ensuring that you stay cozy all winter long.

2. Uniqlo Ultra Light Down

If you’re looking for lightweight yet incredibly warm outerwear, Uniqlo’s Ultra Light Down jackets are an excellent option. These jackets are made with high-quality down that provides exceptional insulation without weighing you down. With a variety of styles and colors to choose from, you can stay stylish and comfortable in any season.

3. Uniqlo AIRism

Uniqlo’s AIRism undertops are perfect for those who value breathability and moisture-wicking properties in their clothing. Designed with advanced technology, AIRism undertops are lightweight, quick-drying, and offer excellent ventilation. The moisture-wicking fabric keeps you cool and dry, making them ideal for active individuals or those living in humid climates.

4. Uniqlo Smart Pants

Uniqlo Smart Pants combine style, comfort, and functionality. Made with stretchable materials, these pants offer freedom of movement and flexibility, perfect for everyday wear or active lifestyles. Additionally, the moisture-wicking properties of Smart Pants ensure that you stay dry and comfortable throughout the day.

Uniqlo’s extensive product lines showcase the brand’s commitment to providing functional, high-quality clothing options for all. Whether you’re looking for warmth, lightweight outerwear, breathable undertops, or versatile pants, Uniqlo has you covered.

Market Entry Strategies and Successes

Uniqlo employs strategic market entry approaches to establish a strong foothold in new regions. One key aspect of its strategy is the opening of flagship stores in prime retail locations. These flagship stores serve as physical showcases for the brand, attracting attention and creating brand visibility. By creating immersive experiences in these flagship stores, Uniqlo aims to captivate customers and leave a lasting impact.

In addition to physical stores, Uniqlo also recognizes the importance of online channels in reaching a wider customer base. The brand leverages e-commerce platforms to expand its reach and engage with customers across different online channels. This online presence allows Uniqlo to connect with customers who prefer the convenience of shopping online.

Furthermore, Uniqlo places great emphasis on synchronized launch timings across different markets. By carefully coordinating its product releases and promotional campaigns, Uniqlo ensures that customers around the world have access to its latest offerings simultaneously. This strategy not only generates excitement and buzz but also creates a sense of unity among Uniqlo customers globally.

Uniqlo’s localization efforts play a crucial role in its market entry successes. The brand understands the importance of adapting to local cultures and preferences. This includes factors like pricing strategies that cater to specific markets and offering various payment methods to accommodate different consumer habits. By tailoring its approach to suit local nuances, Uniqlo fosters a deeper connection with customers, enabling successful expansion into new markets.

Uniqlo’s market entry strategies, combined with its relentless pursuit of innovation and customer-centric focus, have catapulted the brand to international success. With a strong presence in flagship stores, online channels, and a keen understanding of localization, Uniqlo continues to drive its market expansion and deliver its unique products to customers around the world.

Digital Presence and Social Media Engagement

Uniqlo understands the importance of establishing a strong online presence to connect with its target audience. With its e-commerce website and mobile app, Uniqlo offers a seamless shopping experience for customers, allowing them to browse and purchase products with ease.

The brand leverages digital marketing strategies to showcase its products through engaging short films and personalized recommendations. This approach not only captivates customers but also helps them visualize how Uniqlo’s clothing can fit into their own lives.

Furthermore, Uniqlo actively engages with its customers through various social media platforms. By encouraging user-generated content and partnering with influencers, the brand fosters authentic connections and generates buzz around its products. Uniqlo’s social media marketing efforts create a sense of community and enable customers to feel like they are part of something larger.

Social Media Engagement Table

The table above showcases Uniqlo’s impressive social media following, demonstrating the brand’s successful social media marketing strategy. By actively engaging with customers on these platforms, Uniqlo not only increases brand awareness but also fosters a loyal and dedicated community of followers.

Uniqlo’s marketing strategy has solidified its position in the fashion industry and established its brand as a leader in innovation and customer experience. By investing in product development and utilizing its products as a marketing platform, Uniqlo has created a unique and appealing brand story that resonates with its target market . The company’s commitment to delivering exceptional customer experience through in-store training and experiential marketing has further strengthened its position in the market.

In addition, Uniqlo’s emphasis on sustainability and responsible consumption has aligned the brand with the values of today’s conscious consumers. By providing repair services, promoting eco-friendly practices, and offering reasonably priced, durable clothing through its LifeWear line, Uniqlo has successfully connected with customers who prioritize sustainable fashion choices.

Uniqlo’s digital marketing efforts, including its e-commerce presence, mobile app, and social media engagement, have allowed the brand to reach a wider audience and effectively communicate its brand story and values. Collaborations with influential personalities and designers have also heightened Uniqlo’s visibility and attracted new customers.

Overall, Uniqlo’s comprehensive marketing strategy, which encompasses product development, customer experience, sustainability, digital marketing, and collaborations, has positioned the brand as a dominant player in the fashion industry. Through its ongoing commitment to innovation, inclusivity, and engaging content, Uniqlo continues to set trends and capture the hearts of its target audience.

What is Uniqlo’s marketing strategy?

Uniqlo’s marketing strategy focuses on investing in product development, using the product as a platform for marketing and brand awareness, delivering exceptional customer experience, promoting sustainability, leveraging e-commerce, and collaborating with influencers and designers.

How does Uniqlo use its products as a platform for marketing?

Uniqlo developed its flagship HEATTECH clothing line in collaboration with Toray Industries, using advanced materials to generate heat and provide warmth. By focusing on product development and innovation, Uniqlo creates clothing that appeals to a wide range of customers.

How does Uniqlo deliver exceptional customer experience?

Uniqlo invests in experiential marketing and in-store training to ensure consistent and welcoming customer interactions. The brand also launched a digital billboard campaign and offers training to its staff to create a positive atmosphere for shoppers.

How does Uniqlo promote sustainability?

Uniqlo promotes sustainability through its LifeWear clothing line, offering reasonably priced and durable clothing designed for the long term. The brand also offers repair services at its RE.UNIQLO Studio and has launched ECO Bags to reduce plastic waste.

How does Uniqlo leverage e-commerce as a marketing channel?

Uniqlo views e-commerce as a marketing channel to boost in-store sales. The brand acknowledges the mixed touchpoints of customers and runs its e-commerce and physical stores in synergy, using digital marketing strategies to drive sales and enhance the overall customer experience.

How does Uniqlo collaborate with influencers and designers?

Uniqlo collaborates with global ambassadors, such as Roger Federer and Adam Scott, and partners with different groups and designers worldwide. These collaborations help Uniqlo reach different audience segments and expand its reach globally, strengthening its brand image.

What is Uniqlo’s unique selling proposition?

Uniqlo’s unique selling proposition lies in its commitment to creating functional and accessible clothing with minimalist aesthetics. The brand focuses on producing high-quality basics that are suitable for everyday wear.

What are some of Uniqlo’s product lines?

Uniqlo offers a wide range of product lines, including the popular HEATTECH line, Ultra Light Down jackets, AIRism undertops, and Smart Pants. These diverse offerings cater to various customer needs and preferences.

What are Uniqlo’s market entry strategies?

Uniqlo opens flagship stores in prime retail locations to create brand visibility and immersive experiences. The brand also focuses on online channels and synchronized launch timings to reach customers across different platforms, demonstrating an understanding of cultural nuances through localization efforts.

How does Uniqlo engage with customers online?

Uniqlo has a strong online presence with its e-commerce website and mobile app, providing a seamless shopping experience. The brand uses digital marketing strategies to showcase its products through short films and personalized recommendations. Uniqlo also engages with customers through social media platforms, encouraging user-generated content and partnering with influencers.

What contributes to Uniqlo’s success in the fashion industry?

Uniqlo’s success is attributed to its marketing strategies, such as investing in product development, delivering exceptional customer experience, promoting sustainability, leveraging e-commerce, and collaborating with influencers and designers. The brand’s digital marketing efforts and ability to connect with its target market through innovative products and engaging content also contribute to its dominance in the fashion industry.

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How Uniqlo is set to become the world’s top fashion retailer

Last month, Fast Retailing , which owns and operates Uniqlo, made news, and it’s all for a good reason.

The Japanese conglomerate reached a market value of over $105 billion, overtaking Zara’s Inditex for the first time, which was valued at around $98 billion, as reported here.

In this cut-throat world of fast fashion dominated by the likes of Zara ( How Zara became the undisputed king of fast fashion? ) and H&M, how did Uniqlo capture its share in our wardrobes and this competitive industry so quickly?

Building Uniqlo

Uniqlo’s journey began when Tadashi Yanai inherited his father’s chain of 22 men’s tailoring stores in 1972. Through his travels to the US and Europe, Tadashi was inspired by casual wear brands like GAP and Benetton. He identified the potential to build this market in Japan, and in 1984 opened his first store  – Unique Clothing Warehouse in Hiroshima (later renamed as Uniqlo).

Today, with over 2200 stores worldwide, Uniqlo is well known for its simplicity and quality. The brand has always delivered on its promise of timeless, affordable, high-quality basic clothing for all in an industry dominated by changing trends.

So, how did Uniqlo find its niche in the business of fast fashion? What are the strategies that propelled the growth of Uniqlo? Let’s find out!

Vertical Integration Strategy of Uniqlo

As defined by Investopedia, Vertical integration is a strategy whereby a company owns or controls its suppliers, distributors, or retail locations to control its value or supply chain. Vertical integration benefits companies by allowing them to control processes, reduce costs and improve efficiencies.

Uniqlo manages all its operations in-house – right from product planning, and design, to manufacturing and distribution facilities, ensuring that they are always aware of the customers’ needs and purchases. This allows the brand to save on costs that may result from overproduction or unnecessary overheads.

This robust vertical integration strategy enables Uniqlo to replenish the stock in a matter of days and improve products within weeks. Purchasing fabric in bulk helps the company negotiate the price with suppliers and provide affordable clothing options to customers.

Quality > Quantity

One of the key differentiating factors for Uniqlo is its focus on quality clothing. Unlike most mass fashion brands which are trend-based and have shorter life cycles, the brand specializes in season-proof basics.

While Zara  tries to compress its apparel-making process to churn products within a span of 2 weeks, Uniqlo plans its production a year in advance!

We don’t chase trends. People mistakenly say that Uniqlo is a fast-fashion brand. We’re not. We are about clothing that’s made for everyone CEO Tadashi Yanai explained.

By providing quality clothing, the brand has been able to stabilise the buying cycle and deliver on its promise of sustainable clothing.

Uniqlo Strategy makes it a Technology Company

You will often find Tadashi Yanai’s quote, “Uniqlo is not a fashion company, it is a technology company.” And that resonates with every new product launched. Uniqlo’s USP lies in leveraging technology at all levels – from its manufacturing facilities, supply chain, in-store experience to its final consumers.

Uniqlo has been creating innovative fabrics like HeatTech to keep people warm, AIRsm clothing that is breathable and soft, and UV Protection that blocks UV rays from penetrating the skin. LifeWear is on the path to redefine comfort clothing and casual wear. Branding these innovations gives the fashion retailer a unique edge against its competitors.

Each Uniqlo store is designed with a digital customer-first approach. The store is an experiential zone, inviting consumers to explore and learn about the tech behind creating fabrics. The huge LED screens, inviting interiors, bright lighting, and friendly store managers create a holistic and immersive customer experience, ensuring you come back every time!

The company has leveraged digital marketing to engage with customers through a multitude of campaigns and has heavily invested in the potential of E-commerce. Through these digital efforts, Uniqlo aims to capture a larger target market and bring more traffic to the website.

Check out the Shorty Award winning HEATTECH campaign that helped gain 35,000 new customers over 4 Million views!

Brand Collaboration

Uniqlo has strategically tied up with celebrities that resonate with the values it stands for – high performance, resilience, humility, a strong show of sportsmanship, and character. It has 6 global ambassadors across sports, including Tennis sensation Roger Federer and pro-golfer Adam Scott, who are an inspiration to generations worldwide. They speak through their performances, much like the brand!

To compliment the simplicity of offerings, Uniqlo adds a vibrant touch of color and excitement through brand collaborations with Disney, the Louvre, artwork by Andy Warhol, Manga, and tie ups with leading designers such as street artist Keith Haring, Marimekko and Jil Sander to name a few. These collaborations have helped the brand reach audiences where the awareness is low.

What’s better? You could be a collaborator too! Simply by designing your prints on the UTme! App. The app allows you to create a design, tweak it according to your style and get it printed  – all in a matter of 20 minutes! While this is only available at select stores, the potential it taps to stay relevant in fast fashion is tremendous.

The Brand Vision

Keeping the customer at the heart of its business strategy, Uniqlo has been relentless in its pursuit to provide high-quality comfort clothing to all. Tadashi Yanai is on a mission to redefine customer experiences through a robust omnichannel strategy and become the leading brand in every country that the brand operates.

To position Uniqlo as a global brand, Yanai has ensured that every employee in the company speaks in English, differentiating itself from the way traditional Japanese businesses operate. The company culture is open and transparent giving each stakeholder an opportunity to voice their suggestions, irrespective of their designation.

Ever heard the infamous “Welcome to Uniqlo” ? When you enter the store, the company invests in training the storefront employees to ensure the best customer service. In fact, Uniqlo has set up a facility in Tokyo and trains over 1500 store employees each year.

Check out the day in the life of a store manager:

Through Uniqlo, Tadashi aims to develop more on the ambition of “Changing Clothes. Changing conventional wisdom. Change the world.” And in this effort, the brand has been implementing sustainability practices to give back to the society. Through its recycling program RE.UNIQLO, it has collected millions of discarded Uniqlo clothes and provided them to the needy.

The Pandemic Effect on Uniqlo’s Strategy

The Pandemic has hurt the fashion industry. Worldwide, as manufacturing and supply chain operations were closed, people had nowhere to go out as nations were under lockdown. This saw consumers shifting from trendy outfits to comfort, at-home selections.

All fast fashion retailers have something to offer in comfort wear, but Uniqlo, which is more lifestyle oriented, found it’s key opportunity of growth.

In fact, it was reported that Fast Retailing has seen profits return to pre-pandemic level and predicts a total turnover of $21 Billion in the fiscal year ending August 2021.

A major driver for this is Uniqlo’s focus on the Chinese market. Fast retailing saw its business improve in China as the economy opened and coronavirus outbreaks have been under control. With over 800 stores, Uniqlo has become the most preferred fashion retailer in China. And this is credited to the fact that Uniqlo’s Lifewear options fit perfectly as work from home and outdoor casual wear clothing.

The Way ahead

Tadashi Yanai has eyes on Asian domination. The brand launched in India in 2019 and has already set up 3 stores. As they increase their focus on capturing the Indian market, it will be interesting to see how Uniqlo engages and tailors its products to fit the needs of this growing country’s 1.3 Billion population.

For now, Uniqlo has found its place in my wardrobe, what about yours?

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Uniqlo: A Case Study on Creating Market Share with Affordable and Timeless Designs

• First Online: 30 January 2016

Cite this chapter

• Frederike Schulz-Müllensiefen 2 &
• Aenne Stöckmann 2  

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The Japanese designer, manufacturer, and retailer, Uniqlo, is known for casual, high-quality clothing for very affordable prices. During the Japanese recession, the company was valued especially for its low prices. They soon expanded their business throughout Japan. Step-by-step, they expanded internationally and were then competing successfully with the major fashion retailers. Today, it is the fourth largest fashion retailer worldwide. Uniqlo made it possible to successfully educate countries worldwide, within less than 25 years, in its unique product strategy and it is still continuing to enlarge its business operations. By 2020, the company is aiming to become the world’s biggest specialty retailer of private label apparel with a continuous growth rate of 20 %. The company’s success can be explained by its initial success during the Japanese crisis. The consumer’s demand for affordable but high quality clothing was high during this time of recession, as consumers had to cut back on expenditures. After this sudden success, Uniqlo’s founder Tadashi Yanai managed to expand brand awareness and achieved success globally.

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Schulz-Müllensiefen, F., Stöckmann, A. (2016). Uniqlo: A Case Study on Creating Market Share with Affordable and Timeless Designs. In: Segers, R. (eds) Multinational Management. Springer, Cham. https://doi.org/10.1007/978-3-319-23012-2_12

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Case Study | Unpacking Uniqlo’s India Strategy

• Casey Hall ,
• Phyllida Jay

Uniqlo is one of the world’s largest fashion retailers, but its success has been built on unconventional foundations. The Japanese giant pays little heed to fashion trends, relying instead on its high-tech fabrications and wardrobe staples to win over consumers.

Though the brand’s roots go back as far as 1949, it wasn’t until the 1980s that the modern era of Uniqlo began. Following the opening of a store in Hiroshima called Unique Clothing Warehouse by a company that would later become Fast Retailing, the retailer was rebranded “Uniqlo.” Even though its new name was the result of a clerical error, Fast Retailing founder and current chairman, president and chief executive, Tadashi Yanai, decided to embrace the registration blunder as he considered it a “beautiful” mistake.

By the mid-1990s, when many were seeking value for money during Japan’s “lost decade” of economic stagnation and an alternative to the perceived whims and excesses of luxury fashion, the brand became a household name thanks to its upbeat, no-nonsense designs at affordable prices.

Uniqlo’s subsequent expansion into markets across Asia, Europe and North America elevated the brand into a league of global behemoths that included high street players H&M and Zara, making it a serious contender in the mass market. But unlike its fast fashion rivals, Uniqlo does not churn out new styles in lightning-fast production cycles. Instead, it trades on timelessness and a design philosophy of “lifewear.”

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In the nine-month period ending May 31, 2021, Uniqlo-owner, Fast Retailing, reported consolidated revenues of 1.7 trillion yen ($15.49 billion), a 9.9 percent increase from the same period a year earlier, while operating profit rose 72.1 percent to 227.8 billion yen ($2.1 billion).

With over 2,300 stores worldwide and a stronghold in China where it outperforms competitors, Uniqlo now has its sights set on India. The company’s ambitions for the country are considerable, with Yanai indicating that he wants Uniqlo to become the “best-selling retailer in India.”

To make that happen, the company will need to apply — and adapt — lessons it has learned from successful expansion elsewhere in Asia, while taking into account the complexity and singularity of the Indian market. It will also need to make up ground, having only opened its first India store in 2019, almost a decade after the entry of some of its competitors who have built store networks that currently dwarf Uniqlo’s count of six.

But Uniqlo has proven itself adept at seizing a leadership position in Asian markets where its rivals had a first-mover advantage. Can it do the same in India, a colossal yet complicated market which some international brands have yet to prioritise or dismiss as being overestimated as a short-term opportunity?

To be sure, Uniqlo’s India roll-out has been severely disrupted by the pandemic, making it difficult to judge whether it has a winning strategy. Moreover, some of the challenges and uncertainties characterising the market under normal circumstances have only intensified since the devastating second wave of Covid-19 infections hit. Uniqlo, like most brands, faces a long, uphill battle in India but stands to reap immense rewards if it does succeed.

In this case study, BoF examines Uniqlo’s opportunity in India based on an appraisal of its early manoeuvres there and the legacy of the strategies it employed elsewhere. Set against the backdrop of both global and local competitors, it analyses the rapidly changing dynamics of India’s fashion market and the multifaceted behaviour of its diverse consumers, whom Uniqlo will need to win over to achieve its goal of becoming number one.

Of course, the challenges and opportunities the India market presents for Uniqlo are shared by many other international fashion retailers eyeing Asia’s next major consumer giant. In examining the hows and whys of Uniqlo’s approach to India, this case study also reveals important strategic considerations for other brands looking to make their mark in this fast-changing and incredibly complex country.

Click below to read the case study now.

Editor’s Note: This case study was corrected on August 13, 2021. A previous version misstated that Fast Retailing manufacturing takes place in Singapore, Vietnam, the Philippines, Malaysia and India, among other markets. This is incorrect. Fast Retailing does not manufacture in Singapore or the Philippines at the time of writing.

• Tadashi Yanai
• Fast Retailing

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Transparency, Traceability, and Compliance in Uniqlo's Global Value Chain

By: Manolito Hibanada, Ari Van Assche, Hinrich Voss

In January 2021, the Japanese fashion company Uniqlo was accused of using forced labour in its supply chains. Various news reports had been claiming that Uyghur Muslims were being detained and forced…

• Length: 14 page(s)
• Publication Date: Aug 8, 2022
• Discipline: International Business
• Product #: W27299-PDF-ENG

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In January 2021, the Japanese fashion company Uniqlo was accused of using forced labour in its supply chains. Various news reports had been claiming that Uyghur Muslims were being detained and forced to work on cotton farms, production factories, and processing facilities in China's Xinjiang Uyghur Autonomous Region. The United States Customs and Border Protection claimed that Uniqlo was not able to fully demonstrate that its products and inputs were manufactured without use of forced labour or modern slavery in Xinjiang, China and issued a Withhold Release Order to detain Uniqlo's shipment of cotton garments. Uniqlo's attempts to dispute the allegations and overturn the WRO were unsuccessful. The company had to find a way to ensure transparency and uphold traceability across all streams of its value chain activity. But how could Uniqlo ensure ethical sourcing for all aspects of its products, given limited oversight over suppliers and subcontractors? Was cotton traceability a viable and feasible option? How could Uniqlo ensure the compliance all key actors in its value chain streams, across tiers of suppliers and layers of subcontractors?

Hinrich Voss is affiliated with HEC Montreal

Learning Objectives

This case can be used in undergraduate- and graduate-level courses on global supply chain management and international business. The case outlines the challenges companies face in the oversight of their value chain activities and supply chains, which can lead to serious allegations of forced labour. Another dimension that the case presents is the legislative and legal aspects, which can have a significant impact in ensuring transparency and traceability in complex global value chains such as cotton. After working through the case and assignment questions sudents will be able toidentify specific challenges surrounding compliance in the orchestration of global value chain activities; compare and contrast a firm's global value chain compliance options (e.g., cascading compliance versus full chain responsibility); understand the concept of comprehensive traceability and transparency in the context of complex global value chains; describe the interplay between global value chain legislations and regulations across various jurisdictions (which tackle issues such as forced labour), coordination and oversight of global value chain activities, and the role that technology might play in meeting these regulatory requirements; and recommend a series of actions, or courses of action, in assessing the costs and benefits of stakeholder engagement in implementing traceability solutions within the framework of complex global value chains from the perspectives of a lead firm, suppliers, subcontractors, and ancillary global value chains, which may be fragmented across many geographical areas and contexts.

Aug 8, 2022

Discipline:

International Business

Geographies:

China, Japan, United States

Industries:

Retail trade

Ivey Publishing

W27299-PDF-ENG

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