The UK Fashion Industry - Essay Example

The UK fashion industry is only a small part of the clothing industry. Fashion plays a big role in promoting the international profile of UK. Fashionsets the trend, influences design and the image of the UK fashion industry is like following the image of London. The retail sector in UK is the heart of the economy employing about three million people (Mesure, 2007). The UK industry has experienced exponential growth in the last decade, not merely in women’s clothing as fashion is generally associated with, but in menswear childrenswear and accessories as well. The fashion industry today is marked by short life-cycles, high volatility, low predictability and high impulse purchasing (Christopher, Lowson & Peck, 2004). The fashion retail industry in UK is turbulent as the fashion conscious consumers expect and thrive for constant change. Added to the changing consumer preferences are the factors like globalization and the technological changes that have truly revolutionized the UK fashion retailing industry. The fashion retail market is split into number of segments – luxury, high street and supermarket/out-of-town discounter (Bruce & Daly, 2006). With the supermarkets having entered the clothing sector, the fashion retail has been redefined. It enables the time-starved consumers to purchase cheap clothing instead of visiting high street. The cheap chic revolution has turned the UK fashion market upside down (Mesure, 2007). With the rise of the discount retail store the number of garments purchased by women each has doubled. Various reasons have been accounted for this changing trend – shift of production to the Far East, the weak US dollar and the abolition of textile quotas have driven down prices even in chains like Asda and M&S. The phenomenon of disposable fashion rules – “buy it, wear it, and chuck it” is the mantra that the fashion conscious follow in the 21st century. Consumers expect low prices, and increasing incomes are the key to increased economic activity. According to Jones and Hayes (2002), clothing and fashion purchase decisions are based on want rather than need (cited by Priest 2005). It depends upon how the consumer wants to be perceived. Competition is fierce and the market is characterized by excessive discounting. Even top socio-economic groups are price-savvy. Decreased consumer spending has a negative impact on the retailers. Besides, cost of retail space has gone up and rents have risen. According to a research by This is Money, people shop at both the top and bottom ends of the market, picking up high fashion when it suits them and bargains when they spot them (Shop1 2004). The British Retail Consortium states that the success of the small retailer lies in being able to offer consumers something different, something better and something targeted very precisely at a particular portion of the market (BBC 2006). The retail market is competitive and the consumer is the regulator. The downward price trend is likely to continue. There is a growth in the youth market and retailers have introduced incentive shopping. Offers have to be enticing along with frequent change in fashion. Innovation and new products have to be introduced frequently. In the high end sector, certain factors become important like store display and the products on offer. Product styles and timing can be customized to generate better customer satisfaction, which is important in the fashion retail sector as shopping and clothing consumption is no more a female issue. Environmental changes have redefined what it means to be a man (Bakewell, Mitchell, & Rothwell, 2006). Besides, clothing for every season is being produced to suit every market and every generation. The emergence of market power concentration is strongly linked to the development of strong retailer brands (Moore, 1995). Retailers have become efficient in the management of their business and they take full advantage of their market strength. They exploit the power and strength of their own brand and use it to reinforce their market positioning. Store images assist the retailers in determining the positioning strategies (Birtwistle, Clarke & Freathy, 1998). The retailers project an image which matches the targeted customers’ self-image world, which increases customer loyalty. The store image is linked to customer expectations, previous purchase experience and customer perception of the store. An understanding of the customer perception of the store attributes is used in encouraging customer loyalty. The concept of store image has not been effectively utilized by Burton Menswear whose primary target was the 25-45 males but they wanted to serve everybody. In an attempt to do so they failed because when they tried to display high fashion in store front, it chased away the older customers who were the historic customers (Birtwistle, & Freathy, 1998). If they display the classic collection, the younger generation does not step into the stores. Hence, trying to cater to all segments at the same time from the same store does not reap benefits. This conforms to Danneel’s (1996) concept that customers segment themselves rather than the retailer trying to segment the market, a form of reverse market segmentation. Burton wanted to use visual merchandising as a strategy but they failed. According to Lea-Greenwood (1998), visual merchandising in windows is the external communication to potential customers. Burton was aware that they needed to appeal to a certain group but they did not restrict their activities accordingly. They relied on the concept that young people also wear classic clothing. This demonstrates that socio-demographic factors like age and social class are no more related to buying behaviour. According to Newman and Patel (2004), Topshop and Gap had similar store front strategy and targeted the same segment but Topshop faired better due to its quick response times. Gap’s efforts to retain and attract the segment were not in place. They neglected the core base of the young consumers like responding to catwalks and celebrity fashion shows. Topshop had a less aggressive technique but what matters is not to leave a gap between customer expectations and marketing objectives. Surveys have revealed that price is the least important attribute for consumers which also demonstrate how seriously fashion is taken by these consumers (Newman & Patel). Based on this concept, Zara, the global leaders in fashion retail have remained focused on the core fashion philosophy - creativity and quality design combined with rapid response to market demands. The arrival of Zara has given a dramatic shake up the high street retailers. Even M&S had to reinvent itself to remain in the industry as a serious player (Mesure, 2007). Zara has revolutionized the fashion industry because they allow the customers to react and act accordingly. At the time of the downslide in 1997, Burberry had 60 stores in London and a new management team took over the operations (Moore & Birtwistle, 2004). It had a narrow customer base comprising of middle aged, fashion-conservative men. They then decided to target the new, younger, fashion-forward customers, while still retaining the traditional customer base and revised business model to provide for future growth, stability and innovation. It segmented the high priced, fashion conscious customers and wanted attention from international fashion press. It upgraded the product range to suit the changing lifestyles. They adopted the multi-level brand strategy to cater to all segments. In the past they had stuck to men’s and women’s ranges only for autumn and winter collections but now they catered to summer and spring collection as well. They now catered to the highest segment, which is at the tip of the pyramid as well as to the accessories collection which was at the lowest end of the pyramid. This multi-brand strategy gave them the maximum market coverage with broader customer appeal. The differential price positioning helped them to boost sales. This business model defies earlier theories that a store which tries to serve all consumers may end up appealing to none. Burberry changed its strategies in all the marketing mix and achieved success through its new business model. This also demonstrates that power and position in the industry helps to respond to the changing consumer trends and preferences. Apart from Zara, other players in the industry too have had to shorten their supply chains to sustain. The tide is clearly against value retailing as Asda is forced to sell two pairs of jeans for a fiver and Tesco churns out cashmere sweaters for less than thirty quid (Mesure, 2007) but people are now waking up to the ethical trends in the industry as it is believed that is something is available very, very cheap somewhere down the line someone is paying for it. The poor retailer is stuck between the demands for low prices and increasing ethical concerns. Thus it is evident that fashion retailing in UK has undergone a dramatic change but the market exists for both the high end retailers and the discounters. The market is people-centric and products have to be customized. Retailers have to add value to their products in terms of better fabric or store display. There is a quest for individual and Zara is managing to leverage this benefit to their discerning clienteles. The middle market players are fighting for their lives as the gap between the bottom and top ends of the market widen. Value market will strengthen and it does not mean the end of discounters. Nevertheless, the fashion retail industry is challenging as they strive to cater to the wants of the customers. References: Bakewell, C Mitchell, V & Rothwell, M (2006), UK Generation Y male fashion consciousness, Journal of Fashion Marketing and Management Vol. 10 No. 2, 2006 pp. 169-180 BBC 2006, UK corner shops risk dying out, 01 Nov 2007 Birtwistle, G Clarke, I & Freathy, P (1998), Customer decision making in fashion retailing: a segmentation analysis, International Journal of Retail & Distribution Management Volume 26 • Number 4 • 1998 • pp. 147–154 Birtwistle, G & Freathy, P (1998), More than just a name above the shop: a comparison of the branding strategies of two UK fashion, International Journal of Retail & Distribution Management Volume 26 • Number 8 • 1998 • pp. 318–323 Bruce, M & Daly, L (2006), Buyer behaviour for fast fashion, Journal of Fashion Marketing and Management Vol. 10 No. 3, 2006 pp. 329-344 Christopher, M Lowson, R & Peck, H (2004), Creating agile supply chains in the fashion industry, International Journal of Retail & Distribution Management Volume 32 Number 8 • 2004 • pp. 367-376 Danneels, E (1996), Market segmentation: normative model versus business reality, European Journal of Marketing, Vol. 30 No. 6, 1996, pp. 36-51 Lea-Greenwood, G (1998), Visual merchandising: a neglected area in UK fashion marketing? 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