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.
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 – 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 opened a 3-storey store in iconic Harajuku in central Tokyo in 1998 – 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 casualwear at low prices. As at January 2018, the brand has grown to more than 1,300 stores in 15 countries across Asia, Europe and US in just a matter of 20 years. It is the biggest apparel chain in Asia with close to 800 retail stores.
Uniqlo aims to be the world’s largest clothing retailer by 2020 with a sales target of USD 28 billion, based largely on expansion in US, China and online. If Uniqlo achieves this ambitious target, it will dethrone Inditex (Zara’s parent company) as the leader in global apparel.
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.
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 hit USD 28 billion of sales by 2020.
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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