Conclusion

Our dear readers,

After 2 months with you, it's the sad time time to say goodbye. :(

We hope that you enjoyed reading all our posts as well as we enjoyed writing them and they help you to find the brand that fits you the best or at least, how to benefit from the different brands in order to make a very  personal dressing. :)

The Fast Fashion market is an expending market and we observe that many brands have taken it by storm but only a few achieve to stand out of the crowd.

Indeed, the entrance is easy but longevity is quite difficult without any differentiation methods to face to the hard competition.

Despite the economic crisis, brands in Fast Fashion market are doing rather well because it brings reassurance and pleasure for people and the fact of being affordable allows people to buy even if their budget has decreased.

Don't forget to buy each of us in your favorite shops !!

See you Readers !


Your devoted Gaspard, Sandra, Zoe and Emily

         

Competition

Hello dear readers! Hope you are doing well and today we are going to talk about competition on the fast fashion market. So stay tuned ;)

Below you can see a table, describing main fast fashion players on the French market.

	Zara	H&M	Mango	GAP	Massimo Dutti	Bershka
Operating revenue (2013)	910 790 000 €	1 062 526 000 €	157 856 000 €	124 206 000 €	59 516 000 €	98 530 000 €
P/L for period (2013)	44 348 000 €	23 030 000 €	-5 047 000 €	-6 103 000 €	169 000 €	6 703 000 €
Total assets (2013)	573 516 000 €	369 267 000 €	116 397 000 €	78 873 000 €	60 444 000 €	55 819 000 €
Employees (2014)	5 275	5 452	907	826	421	755

Source : Amadeus database

The competition in fashion apparel industry is extremely high, but if we take fast fashion market, we can say that there are several main players in it. What is more, the threat of new companies to enter that market is not very high because of the fact that cost is regarded to be high due to economies of scale. It is really difficult for new entrant to obtain high market share as existing brands have already acquired a reasonable amount of brand resonance. Due to suppressed demand, economies of scale cannot be achieved and the entrant usually faces losses in the beginning. Market experience, brand establishment and product differentiation are the main things that serve as barriers for new entrants. There are experience and expertise that give high valuation to the main fast fashion companies. 

In November, 2014 Forbes has put together a list of world's most valuable brands, placing H&M on the 31st place with $16.8 billion brand value and Zara on the 51st place with $10.1 billion brand value. And despite that fact and as long as H&M, Zara, Mango, Primark, Massimo Dutti, Bershka and several other brands could be considered as main competitors, several facts tell that Zara can be named as a leading brand in terms of price and style. It operates on a whole new business model which provides Zara with a major competitive edge. 

Zara’s production in small batches creates a level of exclusivity not seen amongst competitors. Despite Zara offering over 33,000 item varieties in a year compared to industry average of 3000 items, it is twelve times faster than Gap and at least six months ahead of H&M which is its closest competitor. In this way while other retail chains often slash prices by 50 percent to move mass quantities out of stock, Zara does the same but only by 15 percent.

The fashion market is very competitive and the constant need to update product ranges means that many retailers are trying to extend the number of seasons. Fashion retailers are encouraging consumers to visit their stores more frequently by launching small collections of garments, with the use of the expression limited edition. This is exactly how Zara does. “The average Zara customer visits the store 17 times a year compared to just 3 visits” for its competitors (Gallaugher, 2008). This leads to a shorter life cycle and higher profit margins from the sale of fast selling clothes. The desire to have variety and instant gratification is motivating consumers to buy their clothes less expensive. 

See the perception map below to see a wider selection of clothing retailers in the French market and their perceived value vs style measures.

If we look at this positioning map and compare 4 brands we have been talking about, we can make following conclusions. Taking the classic black T-shirt as a reference, Primark, according to its brand image, is the cheapest, followed by H&M, Mango and then Zara. In terms of quality and style, Zara is considered to be a leader, then goes Mango, H&M. Primark is thought to be the least fashionable and qualitative.

Sources:
https://gupea.ub.gu.se/bitstream/2077/22658/1/gupea_2077_22658_1.pdf
http://www.ukessays.com/essays/business/threat-of-new-entrants-business-essay.php#ixzz3KOB7mc6C
http://www.forbes.com/powerful-brands/

Primark's customers insight

Hi my dear readers !

Today, it’s MY day ! I have finally I left my comfortable shelf from the Marseille’s Primark and now i’m live from the Primark’s bag.

I can’t wait to arrive at my new home with my new friend who has just bought me, Alexandra, a twenty-years-old young women, and speak with her about her feelings and thoughts about my mother brand.

Here is the interesting part of our chat: 

Alexandra : « Hello my new panty !!! I’m so lucky to find you in the Primark shop and so happy that my mum has bought you for me.»

Sandra : «  Hello Alexandra, I’m so happy that you have found what you were looking for in the Marseille’s shop ans especially me.

How was your shopping time ? Did you mother enjoy it as well at Primark ? »

Alexandra : «  My shopping time was very nice ! We decided to go to the shop in the morning because in the afternoon and more precisely during the weekend, the shop is so crowded and a kind of mess. I know that my mother doesn’t like mess. We both found several items : my mom has bought some cushions for the sofa and christmas’ decoration  and me, I have chosen you, one small bag and funny socks. »

Sandra : « Oh lovely, it’s almost Christmas, I love this period, shops are always full of people who are looking for gifts or decoration items. And there are plenty of it in shops. What do you think about the first french Primark shop ? »

Alexandra : « I was very excited like ever time I go to this shop because I always find something to buy and it’s not expensive so I can buy a lot of items (incidentally, you can take big shop bag to carry all your stuffs during your shopping time). But I think despite the fact that there are a lot of people who are working in this shop, it’s complicated to speak with them and you have to make shopping on your own, not relying on somebody's help and assistance. »

Sandra : « Really, can you explain me more ? »

Alexandra : «  Yes of course. My mum was looking for a special thing and she asked a young girl. That girl didn’t stop walking, she just showed the area where we could find the item : in fact, there is no special help, only quick indications. My mom, for sure, wasn’t so enthusiastic about the young girl’s behavior. For me, it’s different, I prefer to look around.»

Sandra : «  I’m sorry for that ! But at least you have found beautiful and cheap articles. Thanks for answering to all my questions Alexandra ! »

Like Alexandra said,customers in Primark buy on average 6 items per visit for about 30 euros. 

Primark keeps advertising and branding to an absolute minimum. Despite their size as a corporation they refuse to advertise themselves through adverts or the web, and only have the most basic and informative of websites. Their window displays and signage is minimal and informative, so as not to aim at any specific demographic. 

This results in all of Primark’s publicity coming solely from word of mouth. Consequently the image of Primark is in the hands of the public, which has worked partly in their favour. The name frequently hits headlines in news stories, but this image of Primark is one of incredibly low prices, hand in hand with incredibly low quality. When a customer buys a product they are pleased with from Primark it is often met with a surprised reaction at the source of the product, as Primark is a brand not proudly boasted about. This is echoed by the store itself, branding all of its clothing ranges completely separately from the Primark name. To break such an image would require funds and effort Primark would rather not spend, to alter a market position they’re already perfectly comfortable in.

Readers, I hope you enjoyed this little chat with my new friend Alexandra.

Many thanks to my friend Laurence P who has helpe me with this article.

Have a good evening

See you very soon :)

Sandra

Sources :

http://www.kantarworldpanel.com/fr/A-la-une/primark2014
https://brandingfolk.wordpress.com/2012/09/21/35/

Primark's shop experience in Marseille

  

H&M's customer insight

Hello my dear readers! Have been missing me?:) Ok, here I am, Emily. And today I am going to tell you about why customers want to buy me, an H&M T-Shirt, so much!

H&M’s target customers are youths and young adults of both sexes who belong to the group of fashionable and trendy consumers who see shopping as a social activity providing pleasure in their daily life. They acquire the most fashionable clothes each season and want to follow the trends without investing a lot of money. In order to fulfill the needs of the customers, H&M launched EDLP (Every Day Low Prices) products. By adopting this strategy, H&M teaches fashion buyers not to wait for department-store sales but rather buy H&M low-price brand-name products.

In fact, to maintain the low price policy, H&M has to give up the customer service. Fitting and cashier usually have long queues. Sales staff is relatively less as compared to the number of customers. It is not easy to get help when you have encountered problems or issues.

Picture:http://www1.pictures.zimbio.com/gi/TEEN+VOGUE+Fashion+University+H+Shopping+Party+_s7rfT0Jr0bl.jpg

The company slots its customers into two distinct categories – practical consumers and fashionable and trendy consumers and caters to requirements of each group separately. Keeping this basic difference of these two groups in mind, H&M stocks its stores with clothes of distinct categories so that not one member of either group return unsatisfied.

Consumers do not consider H&M as the ultimate in luxurious clothing. They consider it to be a convenient outlet where you could grab a decent looking (it really does not matter whether every other person in the town is wearing something that is an exact replica or very near to it) outfit at a really affordable price.

Picture: https://retaileye.files.wordpress.com/2012/06/img_2608.jpg

Despite the fact that consumers identify H&M as a trendy clothing brand for various everyday usages, they do not feel committed to the brand. In other words, when it comes to everyday affordable and trendy clothing, H&M is one of the preferred brands in the consumer’s consideration set but it does not go beyond the product’s practical benefits. There is no emotional attachment to the brand nor a sense of community. When looking for a T-shirt, customers will surely drop in at Gap or Primark and if they get something that they were looking for at an acceptable price, they would not hesitate to purchase it.

H&M customers can be divided into following categories:

• Customers who love to shop but are not compulsive shoppers and would like to spend time in other activities also. This group would not hesitate in buying if they are able to locate products that are fashionable, cheap and, most importantly, conveniently located for quick purchase. 
• Customers who love variety, a lot of collections and almost always buy accessories along with dresses and lay more emphasis on fashion and style while making a purchase.
• Customers who are on the lookout for trendy styles and attractive designs.  H&M has some products which are cheaper and some with higher prices. Good quality of fabric and fit and finish is a must for this group of customers and they simply do not mind to pay a little extra for that perfect cut and fit. In addition, H&M constantly invites the top fashion designers in the industry such as Karl Legerfeld to be their partners for designing the new collections and that collections have really high prices.
• Customers who are on the lookout for bargains and all that they are concerned with is price, discounts and sales. The best way to attract and retain this group is to provide special offers that promise to provide more than what the customer pays for.

Picture: http://www2.pictures.zimbio.com/gi/TEEN+VOGUE+Fashion+University+H+Shopping+Party+iCpX0na34Kal.jpg

The common determinants that would motivate all these four categories to enter an H&M store and buy its products are:

• A well thought out and innovatively planned layout of the store that would allow customers to get a clear idea of the different varieties that are on offer and related prices without becoming too much dependent on store assistants.
• Regular stream of offers and discounts that would wean customers away from competitors.
• Conveniently located stores that can be easily accessible.

Picture: http://www1.pictures.zimbio.com/gi/TEEN+VOGUE+Fashion+University+H+Shopping+Party+GDzLOSeSXffl.jpg

Hope you liked my article! See you soon, have a good time and do some shopping ;)
Yours sincerely,
Emily

Sources:

http://heroinandmoss.blogspot.fr/p/product-strategy.html

http://niranjanchatterjee.wordpress.com/2009/05/01/hm-a-study-of-the-company-and-its-marketing-techniques/

Zara's customer insight

Hello my dear readers! Now it’s my turn to tell you about my experience of staying in Zara shop, meeting its customers and getting deeper in their minds and I am going to explain you why do they go shopping in Zara and not to another shop and what they think about while choosing their clothes…

So here we go!;)

To cut a long story short, “fast fashion” is Zara’s customer magnet.

By understanding what motivates its “fashionista” customers, Zara has changed the definition of success in fashion retail. Customers make an average 17 annual store visits, compared to 4 visits for other retailers. The Zara “habit” that keeps customers coming through their door results in more products sold at fully retail and not left till sale season: nearly 85 percent of Zara’s inventory sells at full price, compared to a retail average of 40 percent.

Zara wants customers coming back into their stores, where customers can always find new products—but they're in limited supply. There is a sense of tantalizing exclusivity, since only a few items are on display even though stores are spacious. A customer thinks, "This green shirt fits me, and there is one on the rack. If I don't buy it now, I'll lose my chance."

Such a retail concept depends on the regular creation and rapid replenishment of small batches of new goods. Zara's designers create approximately 40,000 new designs annually, from which 10,000 are selected for production. Some of them resemble the latest couture creations. But Zara often beats the high-fashion houses to the market and offers almost the same products, made with less expensive fabric, at much lower prices.

The process of shopping in Zara can even remind us a ‘hunt’ for clothes.  Customers swarm to stores to see what is new and what they must not miss and what they must own before it’s gone forever. It is not H&M where you see the same top hanging for 4 months so then you can think about purchasing it for weeks.

Fast decisions and more money spending – that’s what shopping in Zara is all about. 

Picture: http://resources2.news.com.au/images/2011/04/17/1226040/590782-zara-fashion-sydney-retail.jpg

But how Zara reaches its customers?

·     Store location: The company always tries to find the perfect location and ensure its brand is visible to as many people as possible. Go to any major cosmopolitan capital of the world and you will find Zara situated in the most prime locations of every posh neighborhood worldwide.  In fact, it tries to situate its stores as closely as possible to any other luxury brands such as Burberry and Prada; however, at the same time, Zara still maintains its affordable prices for its customers. This strategy can help Zara not only to build up its brand as fashionable designs with high quality but also attract those who have limited budgets to buy stylish goods. 

Zara shop in Cannes
Picture: http://www.1-cities.com/images/shopping-images/lrg_zara_cannes_2012_1000x750_1103270271.jpeg

·     Store window: The first meeting point with the customer. Zara indeed does not have any printed advertisement such as posters or brochures, but they promote themselves through their display windows.

Picture: http://retaildesignblog.net/wp-content/uploads/2012/12/Zara-Christmas-windows-2012-London.jpg

A display window is a window in a shop displaying items for sale or otherwise designed to attract customers to the store (Wikipedia). Definitely Zara sets their focus on the second characteristic of display windows. Instead of paying a lot of money for printed advertisement they invest this money and a huge amount of time into the design of the display windows. It is not just a way of presenting the most outstanding pieces of their new collection. For Zara the display windows are a way of powerful communication to the customer. But who is in charge of the shop windows?

It all happens in La Coruña (Spain), where the headquarters of Inditex called “The Cube”, who is the fashion group that owns Zara, is based. In the lower floors of the headquarters is a display unit provided, which consists of 25 full-size store windows with display platforms and variable lightning. Special teams of designers try to invent new shop-window-looks there and analyze how the store windows will look like on a bright day or at night. This display unit is called “Fashion Street” and is similar to a laboratory, where store constructions, window displays, and merchandising are evaluated and tested. Once a shop window design is approved, they are sent out to the stores. Paris as well as New York and also Berlin-all stores worldwide have to adapt to the chosen display window design. However the product line can be different from store to store, but the window designs have to be the same everywhere.

Zara manages not only its display windows, but also  the colors, the light, the price, also the music that we hear and many other things so that the customer is attracted to the store. All the work Zara puts into the window design pays off, because a lot of customers walk by and think: “Wow, this looks so great! I just have to go inside!”

Picture:http://retaildesignblog.net/wp-content/uploads/2013/06/Zara-windows-2013-London.jpg

·     Interior design and store image: Has to be right every time. Zara renews this image every six to eight months in all of its stores. First of all the store is extremely spacious at more than 1,400 square meters, you get to shop at ease in an interference-free environment. The store design’s main focus is simplicity, making shopping simple. 

Picture: http://rockthetrend.com/wp-content/uploads/2013/08/IMG_4249.jpg

But the problem is, when there is a sales period, you will find such a mess in the shop, that sometimes it is impossible to find anything in huge piles of clothes!

Pictures: https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhNYw2V3wAQfgvdwi-gS1VohS59AHvSqru-Db7CuzZVuYobDT5AtyiqXcvhCArOc5vL5LbO2Zwu4k1zo4husAEhs1PXCfw_5m_M9BzCJ3OaD9Wjxp5KJVuxwZp2vFPVC-sHJFX5l9kvgQ/s640/zara-delhi-sale.jpg
http://edge.ixigo.com/img/zara-images-photos-50cb33ede4b00cef5bf765d1.jpg

·     Goods display: A dedicated team of coordinators displays the collections by showing off the best trends, fabrics and colors. Zara is changing its collections every 15 days. The staff has certain rules of how to organize and locate clothes and shoes in the shop: they need to match with each other by style and colors! When a customer finds a beautiful blouse, clothes, which are lying around that blouse, will for sure catch her attention as there will be some shoes, bags and jeans which all together make an excellent look.

Picture: http://rockthetrend.com/wp-content/uploads/2013/08/IMG_4279.jpg

Picture: http://rockthetrend.com/wp-content/uploads/2013/08/IMG_4263.jpg

Picture: http://rockthetrend.com/wp-content/uploads/2013/08/IMG_4287.jpg

·     Customer service: Something Zara believes it's excellent at. The aim is to have as much personal contact with the customer as possible.

Sources:

Jeanne Bliss (2009) "I Love You More Than My Dog": Five Decisions That Drive Extreme Customer Loyalty in Good Times and Bad. USA: Penguin Group

http://hbswk.hbs.edu/archive/4652.html

http://zarafashion2013.wix.com/zara#!brand-identity/c1xbv

http://hitthenailonthetop.wordpress.com/2012/04/23/the-zara-display-windows/
http://www.slideshare.net/roula72/zara-final-search

Mango's customer insight

Hi my dear readers,

I am so excited! I have just left the shelves of the Mango shop located in a big mall in the area of Toulouse in the southwest of France to move into the wardrobe of my new owner, an urban woman of 35 years old whose name is Caroline.

Once arrived at home, I asked her to tell me about her “experience” in the shop!

Here is our discussion:

Caroline: “oooh Zoé, I can’t wait to wear you, lucky me to find you this afternoon while doing shopping with my     niece of 18 years old…

Zoé:       - … sorry to interrupt but I am surprised that you and your niece are doing shopping in the

same shop.

Caroline: - Mango suggests in fact a large variety of fashionable and basic garments covering a large target of

modern and urban woman from 18 to 40 years old. I like doing shopping in Mango’s shops because there are made of a simple and standardized design. Indeed they are composed of two colors (black    and white) with a majority of black, hence they appear dark and give, in my opinion, an impression of simplicity, quality and well  organized shop.

If you ask my niece, she would tell you that she likes Mango because she can find quality products from elegant clothes to casually ones through to eveningwear. All the more, even if it is a little more expensive than H&M and Primark, this represents for her better quality, chic and well-dressed products than them.

All the more, this afternoon, we saw in the shop window that there is a discount of 30% on a selection of products, so she asked me to go into the shop.

Zoé:        - And had you noticed me before going in the shop?

Caroline:  - Oh no, at first I hadn’t planned to buy anything but I saw a tee-shirt I bought 2 weeks ago on a dummy suggesting a dress code. I like this shop because there are ideas of how to fit clothes together(from the shoes to the accessories) and also because there are not a lot of garments on the shelves. So, it is clear and well organised. All the more, there are big stickers to indicate the prices.
I was looking at the the skirt on the dummy and a seller asked me if I wanted a size in order to try. There were 6 sellers dressed in red including one responsible of the fitting rooms and one at the cashier. They have micros and earphones to communicate with each others.
My size wasn’t displayed on shelves and the seller asked to his colleagues in his micro if the product was available in stock. It was and here we are, I met you J
Compared to H&M and Primark, we are more advised in Mango shops.

Zoé:       - Lucky you that this shop had me in stock ;)

And what did your niece buy?

Caroline: - She found in the entrance of the shop a pullover with the discount of 30% announced in the shop  window! We can’t miss this pile of clothes at a lower price as it is well indicated thanks to stickers!

Zoé:        - I am pleased to hear that you both have found your happiness!!

Caroline:  - I am pleased too but this is also a trap; I have found near the dummy I was looking for a pair of shoes which would fit perfectly with the dresscode. This is a practical turn of the Mango’s shops; each products are filed according to colors and styles, hence it gives you some inspiration.
But I will wait before buying these shoes!

I will keep it in mind thanks to the little leaflet of the new winter collection I received at the cashier.

And a last benefit of Mango is that the music in shops is relatively soft and pleasant compared to    Primark and H&M where you seem to be in a night club, at least for a 35-year old woman ;)”

Have a nice evening!

Zoé





Sources:
http://www.tendances-de-mode.com/2007/09/17/387-mango
http://shop.mango.com/FR/femme