GROUP 7 : UNIQLO
Answer the question
1. Dilemma of Global Fashion Brands in Competing on a Global Scale
Global fashion brands face several dilemmas when competing globally,
especially against emerging low-cost brands like SHEIN from China:
Cost vs. Quality: Competing with SHEIN's low-cost strategy is challenging, as
global brands often focus on quality, sustainability, and branding, which
increase production costs.
Speed to Market: SHEIN leverages a fast-fashion model with rapid production
cycles, making it difficult for traditional brands to match their agility.
Local Adaptation vs. Global Consistency: Global brands struggle to balance
the need for local responsiveness with maintaining a consistent brand image
worldwide.
Digital Engagement: Emerging brands like SHEIN excel in digital marketing
and leveraging social media influencers, whereas established brands may lag in
adapting to new consumer engagement trends.
2. How to Compete with SHEIN's Low-Cost Strategy
Enhancing Sustainability: Highlight environmentally friendly practices and
ethical labor standards to appeal to conscious consumers.
Investing in Technology: Utilize AI and data analytics to optimize production,
predict trends, and improve the supply chain to reduce costs and increase
efficiency.
Strengthening Brand Loyalty: Focus on storytelling and building emotional
connections with customers through campaigns and personalized experiences.
Localized Collections: Develop collections tailored to specific regional
preferences without compromising global standards.
Partnerships with Influencers: Leverage collaborations with local influencers to
engage with younger audiences effectively.
3. Suggested Strategy for UNIQLO in the Global Fashion Industry
UNIQLO can adopt a Transnational Strategy, which balances global integration
with local responsiveness:
Core Competence: Continue focusing on high-quality, functional clothing that
emphasizes innovation (e.g., HEATTECH, AIRism).
Localized Product Lines: Develop region-specific collections based on local
climates and cultural preferences.
Sustainability Focus: Enhance its sustainability programs, such as recycling
initiatives and eco-friendly materials, to differentiate from fast fashion.
Digital Transformation: Expand e-commerce platforms and use advanced
technologies to personalize shopping experiences.
Affordable Luxury: Position itself as a "value-for-money" brand offering better
quality than fast fashion but at competitive prices.
Global Collaboration: Engage in partnerships with designers or artists globally
to stay relevant and appeal to diverse markets.
These strategies allow UNIQLO to compete effectively in the global fashion
industry while maintaining its unique brand identity.
4. The challenges that Uniqlo faces when implementing a transnational
strategy
Cultural Differences
Uniqlo faces the challenge of adapting to different fashion preferences and
trends in each country. For example, Uniqlo's minimalist style may not align
with the fashion tastes of some markets, requiring the company to adjust its
products to better meet local demands.
Supply Chain Complexity
Managing a global supply chain is a significant challenge. This includes
ensuring consistent product quality, efficiently managing inventory, and
minimizing transportation costs. This complexity can lead to increased costs
and logistical issues.
Local Competition
Uniqlo has to compete with established local brands that have a better
understanding of the market. These brands often have the advantage of deep
insights into local customer needs and preferences, which Uniqlo needs to work
hard to achieve.
Regulatory Hurdles
Each country has different regulations and trade policies, which can complicate
Uniqlo's business operations. Complying with these regulations is not only
costly but also requires extensive knowledge of the legal environment in each
market.
Changes in Consumer Behavior
Consumer behavior can change rapidly and vary widely between markets.
Uniqlo needs to continuously monitor and adapt to these changes to maintain
its appeal to customers.
These challenges require Uniqlo to have flexible and creative strategies to
overcome them while leveraging its strengths to sustainably grow in the global
market.
