Uniqlo - Is branding important in the apparel industry?
Uniqlo, a name formed by the fusion of two words Unique and Clothing, is usually referred to as Japanese version of Gap. Founded in 1995 by Tadashi Yanai, Uniqlo has become the number one brand among the Japanese retailers with more than 700 stores and a revenue totaling US$3.5 billion in 2005. In its bid to become one of the global giants in apparel, the company started to expand globally. In 2001 it entered the UK market and in late 2005 entered the US market.
The Uniqlo story is different and interesting at the same time because of its underlying philosophy of people before brand. What does it mean and what are its implications for the brand?
Literally every sector of the industry is proliferated with brands - regional, national and international - and the apparel industry is no exception. The US apparel industry is probably one of the most competitive apparel markets in the world. This ultra competition makes it a perfect place for brands to thrive.
One of the main reasons for the tremendous success of branding and also the presence of a great many number of brands in the apparel industry is because apparels are very self-expressive products. People use clothing as a major avenue to express their sense of self to the world. Coincidentally, one of the main functions of a successful brand is to provide a channel for the consumer to express himself. As such, branding becomes more important in the apparel sector than in many other sectors as the symbolic value is very high.
If Uniqlo's brand philosophy is analyzed in this background, it makes for a really intriguing case. When the brand entered the US market in late 2005, it did that by opening three stores in a New Jersey mall. The brand created the initial awareness in the market place by using news paper inserts that displayed its variety of clothes and the low price. But to create a distinctive position the brand follows a position where it puts the customer before the brand. The CEO of Uniqlo USA Nobuo Domae says: "We are selling jeans, not style, we don't want to push our brand logo, and you can combine our clothing with other brands". This is very different from what one hears in the industry. By not emphasizing the brand image and identity aspects, Uniqlo might be making a mistake.
Playing in a sector where self expression, fashion, symbolic value and self-expression are sky high, brands and strong brand identities provide a channel for consumers to achieve all of the above parameters. Uniqlo, by emphasizing low price and high quality is hoping to win the race. Time will tell whether this strategy will be successful and can sustain pressure from new brands and tough competition.
The Uniqlo story is different and interesting at the same time because of its underlying philosophy of people before brand. What does it mean and what are its implications for the brand?
Literally every sector of the industry is proliferated with brands - regional, national and international - and the apparel industry is no exception. The US apparel industry is probably one of the most competitive apparel markets in the world. This ultra competition makes it a perfect place for brands to thrive.
One of the main reasons for the tremendous success of branding and also the presence of a great many number of brands in the apparel industry is because apparels are very self-expressive products. People use clothing as a major avenue to express their sense of self to the world. Coincidentally, one of the main functions of a successful brand is to provide a channel for the consumer to express himself. As such, branding becomes more important in the apparel sector than in many other sectors as the symbolic value is very high.
If Uniqlo's brand philosophy is analyzed in this background, it makes for a really intriguing case. When the brand entered the US market in late 2005, it did that by opening three stores in a New Jersey mall. The brand created the initial awareness in the market place by using news paper inserts that displayed its variety of clothes and the low price. But to create a distinctive position the brand follows a position where it puts the customer before the brand. The CEO of Uniqlo USA Nobuo Domae says: "We are selling jeans, not style, we don't want to push our brand logo, and you can combine our clothing with other brands". This is very different from what one hears in the industry. By not emphasizing the brand image and identity aspects, Uniqlo might be making a mistake.
Playing in a sector where self expression, fashion, symbolic value and self-expression are sky high, brands and strong brand identities provide a channel for consumers to achieve all of the above parameters. Uniqlo, by emphasizing low price and high quality is hoping to win the race. Time will tell whether this strategy will be successful and can sustain pressure from new brands and tough competition.
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