Expansion
into Toronto
Adrian Iwankewich
Daniel Juhasz
Daniel Sherrington
Eastern Yoo
Sunny Dey
Vipi Thevathas
Wednesday December 3, 2014
Prepared for Paul Gillespie
MKTG 5007
Table of Contents
Contents
Company Overview
1
Executive Summary
2
Market Overview 2
Product & Channel Strategy4
Situation Analysis 6
PEST Analysis
7
Porter’s Five Forces Model 8
The Plan9
Marketing Strategy
10
Communications Strategy 14
Market Analysis
17
Sales Forecast
17
Contingency Plan 18
Works Cited 19
i
Company Overview
Founded by Tadashi Yanai, the first Uniqlo retail
store opened in Hiroshima, Japan in 1984 (Uniqlo,
2014). Initially, Uniqlo started off as a “suburban roadside clothing store network” but in 1998 the company opened its first urban store in the super trendy
Harajuku area, Shibuya ward and became very popular in major downtown cities such as Tokyo and
Osaka (Uniqlo, 2014). By 2005, the company had over
700 stores in Japan. The success of Uniqlo’s ability to
provide superior quality at low prices is due to their
“creative” control of the planning, design, manufacturing, distribution and sales (Uniqlo, 2014).
of the Soho district in Manhattan, but, once again,
sales were not up to standard. Through communication with employees and customers, mid-management discovered that the low sales were due to the
unpopularity of the loose fitting apparel. Typically at
the time, apparel brands like The Gap, J-Crew and Banana Republic catered to a universal fit, “with a looser, relaxed-in-the-middle fit” (Urstadt, 2010). Uniqlo
decided to experiment by introducing slimmer Japanese sizes. As a result, brand equity and location
sales rose. Downtown consumers quickly converted
into loyal Uniqlo customers (Urstadt, 2010). Usually
the company is not concerned with changing their
brand line for fads or short-term trends, but the demand for skinnier and slimmer fits in apparel has
now become a new universal fashion norm.
In 2001, Uniqlo opened their first store in London England. In 2002, they opened their first store in China.
And in 2005, they opened their first store in South
Korea partnering in a joint venture with Korea’s largest distributor Lotte Shopping Co. LTD. Also in 2005, Uniqlo’s timeless, functional apparel, with its combithe company launches in the United States, opening nation of superior quality and low prices, has prov3 stores in New Jersey shopping malls (Uniqlo, 2014). en recession proof on two major occasions. During
In 2006, the company was forced to rebrand their the decade long recession in Japan throughout the
American stores due to dwindling sales (Urstadt, 1990s, Uniqlo succeeded in dominating the market
2010). The stores in the New Jersey shopping malls as the go to apparel store for price sensitive shopwere not profitable, and as a result, Uniqlo decided pers. During the global recession in 2009, Uniqlo saw
to shift their target from the suburban to the urban their profits rise 17% (Durisin, 2013). As of today, Uniqmarket. Thus, a flagship store was placed in the heart lo now has 1400 stores worldwide and 40 stores in
the United States.
Retrieved from Google
1
Executive Summary
Globally, Uniqlo is the fourth largest Specialty Store Retailer of Private Label Apparel, behind INDITEX (Zara),
H&M, and the Gap (Fast Retailing, 2011). Furthermore, in Uniqlo’s 2013 fiscal year, their sales grew 23.1%.
Established as the largest apparel retailer in Asia, Uniqlo began expanding into the global market during the
early 2000s (Passport, 2014).
The apparel market in Canada contains Uniqlo’s main competitors. The competitive landscape is extensive
and congested with no brand holding more than 1.9 percent market share (Passport, 2014). It is essential
that Uniqlo pursues the proper marketing objectives and strategy to leverage their core competencies of a
high quality product, low price, and Japanese identity.
Uniqlo’s Canadian marketing objectives are to raise brand awareness, position the company as Canada’s
number one casual wear retailer, and to increase market share in the Canadian apparel market to 1.0% by
2022. The marketing strategy to fulfill these objectives will include unveiling Uniqlo’s first Canadian flagship
location at Yonge and Dundas Square - a high profile, high traffic location surrounded by clothing retailers.
This brick and mortar location will also be accompanied by an extensive e-commerce channel to serve the
rest of Canada. Uniqlo will highlight their unique high quality, low-price strategy through informative outof-home advertisements and the introduction of a HEATTECH Parka Jacket retailing for just $150. Utilizing
promotional strategies, Uniqlo will aim to increase sales through the Toronto location and online store with
the goal of expanding to other Canadian markets.
According to Fast Retailer Inc.’s annual report, the average Uniqlo location produces 933,000 yen per square
metre, or $830 per square foot. Therefore, Uniqlo’s Toronto flagship location will be striving to attain yearly
sales of $33, 200,000.
Market Overview
Uniqlo will be entering the Canadian menswear and womenswear markets,
markets within an industry which contain extensive competition. However,
both the womenswear and menswear markets in Canada are projected to
experience growth between 2013 and 2018.
As far as the menswear category is concerned, it is projected that it will
grow 6.5% in volume and 10.1% in value in the next 5 years (Passport, 2014).
Moreover, it is projected that the womenswear category will have a 6.2%
growth in volume and a 8.4% growth in value within the same time period
(Passport, 2014).
Next five
years
Menswear
growing at
10.1%
Womenswear
growing at 8.4%
2
Competitors
Uniqlo’s primary competitors in the United States are H&M & Zara (Fast
Retailing, 2011). Each of these businesses posted sales increases in Canada during 2013 (Passport, 2014). Furthermore, both are large players in the
Canadian menswear and womenswear categories. In regards to womenswear, H&M and Zara hold 1.8% and 0.6% of the market, respectively, with
H&M having the largest market share of any brand (Passport, 2014). In the
menswear category, on the other hand H&M and Zara hold 1.1% and 0.6% of
the market, respectively, with Nike having the largest share of the market
at 3.2% (Passport, 2014).
Although the competitive landscape is vast, Uniqlo is the largest clothing
retailer in Asia and commands a certain brand awareness that has created
demand for the clothing in countries in which Uniqlo has not typically serviced. The growth of the Canadian menswear and womenswear markets
signifies an opportunity for an established brand to enter the landscape
with the ability to gain a profitable share of the market.
Share of Market
in Canada
Menswear
1.8%
Womenswear
1.1%
56 Stores
Target Market
A vital aspect of Uniqlo’s corporate mission statement focuses on providing
clothing that, “anybody can wear whenever and wherever,” however, when
expanding into Canada, it is essential that a segment of the market is selected as a target (Uniqlo, 2014). Moreover, as per the lifestyle and attitude
data sheets available from Print Measurement Bureau, the individuals who
have the largest purchasing index of Uniqlo’s direct competitors’ products
are men and women between 18 and 34 (PMB, 2014). In addition, within this
target, the largest buying index typically correlates to professionals and
individuals with some form of post-secondary education (PMB, 2014). Therefore, the target market for expansion into the Canadian market, particularly
in Toronto, will be the same target market as those of its competitors. The
preparation of marketing communications for the expansion will focus on
men and women between the ages of 18 and 34 who are professionals and
have attained or are seeking a post-secondary education.
Menswear
0.6%
Womenswear
0.6%
25 Stores
The location of Canada’s first flagship location will be in Toronto, Ontario. Toronto has the largest population
of any Canadian city, and the most comprehensive retail options in the country (Retail Insider, 2014). Furthermore, as per Stats Canada’s 2011 Census, 25% of Toronto’s population are of Asian descent (Statistics
Canada, 2013). It is documented that those of Asian descent in the United States possess a higher likelihood
of brand awareness (Retail Insider, 2014). Toronto is, therefore, an ideal geographic and demographic location
to place Canada’s first Uniqlo flagship location.
3
Product & Channel Strategy
Uniqlo aims to be the largest clothing company in the world. They aim to achieve this
goal by maintaining low prices, high quality products, and the strategic placement of
retail locations.
Uniqlo’s products are low in price, and designed for everyone. Their clothing is functional, meeting the needs
and wants of a large scope of consumers. Their product is differentiated by their focus on high quality, simplicity, comfort and functionality (Fast Retailing, 2014). Uniqlo sets themselves apart from clothing companies
that focus strictly on fashion by specifying the importance of the following statement: "More than trends,
consumers need functionality. The product should be tough. It should be convenient to wear for daily life”
(Chu, 2014).
Uniqlo’s strength is in volume. For example, if you enter a store to purchase a t-shirt, you can choose from
a large display showcasing over fifty colours. The clothing styles are generally simple, but allow consumers
to customize their own wardrobe, with the large selection of colours made available. This characteristic of
Uniqlo’s clothing make it suitable for any type of person, ignoring fads and trends (Chu, 2014). By focusing on
function, selection and timeless deisgn, Uniqlo reduces risk of losses through fading fashion trends.
HEATTECH
AIRism
Uniqlo has partnered with a materials manufacturer Toray Industries to produce clothing made with
their HEATTECH fibres. This unique blend of materials
allows Uniqlo to produce thin and very comfortable
inner wear that is also very warm.
Airism is Uniqlo’s functional line of clothing designed
for active people. Its special blend of microfibres
absorbs and dries perspiration. AIRsim, alongside
HEATTECH, give a special aspect of functionality to
Uniqlo’s clothing.
Retrieved from Google
“More than trends, consumers
need functionality. The product
should be tough. It should be
convenient to wear for daily
life.”
Uniqlo- Design Director
(Chu, 2014)
4
“The company offers clothing basics, but
basics that are current, that respond to
what's going on today in art and design.
Kino-bi means function and beauty, joined
together: the clothing is presented in
an organized, rational manner, and that
very organization and rationality creates
an artistic pattern and rhythm. All these
qualities reflect the defining characteristics
of modern Japanese culture, modern
‘Japaneseness,’ he said.” Nobuo Domae
(Chief Executive Officer of Uniqlo USA)
The Japanese identity associated with Uniqlo’s origins can be considered as valuable brand equity (Fast
Retailing, 2013, p. 22). Although priced very low, the quality of Uniqlo’s fabrics are a cut above. Mastering
economies of scale, Uniqlo is able to negotiate low prices from their material manufacturers due to their
mass volume demand. This results in Uniqlo’s peculiar position of selling high quality for low prices.
Retrieved from Uniqlo.com
Uniqlo is a specialty store retailer of private label apparel, or also known as an SPA. The companyretails
their clothing exclusively through their own brick
and mortar retail locations, as well as through their
online store. Store locations in the United States are
currently in high traffic urban areas and major shopping malls in the core of large cities. Uniqlo often
positions their flagship locations nearby competing
flagship clothing stores. By operating flagship stores,
Uniqlo is able to gain brand exposure, and showcase
their low price, high quality apparel amongst other
top clothing retailers around the world. The majority of their stores are of a large scale with multiple
floors, facilitating the display of Uniqlo’s product variety. Their flagship stores are lavish in design and
aesthetics. Their aim is to open the majority of their
stores at a minimum size of 17,750 square feet (Annual Report, 2013, p.41).
5
Situation Analysis
Strengths
High-end Quality at Low Cost
Mass volume retail
Highly specialized in fabric
technology and quality
Innovative fabric technology:
HEATTECH & AIRism
Advanced Research and
Development Centers
Japanese Identity
Excellent relations with
manufacturers to “secure stable
high volume supply of top quality
materials”
Largest Apparel-retail Market Share
in Asia
Opportunities
Large Asian population in the GTA
Positive brand awareness among
conscious fashion-heads
Huge winter market. HeatTech line
perfect for Canadian winter.
Weaknesses
No logo on clothing unrecognizable.
Smaller selection of fabrics and
clothing styles than competitors.
There is very little brand
awareness in Canada to the
general public.
Not a lifestyle Brand. Purposely
non-referential.
Sizes and fit do not cater
universally to the clothing retail
market (due to slim fits).
Threats
Already established competitors
in the Canadian Market including
Zara, H & M and American Apparel.
Canadian consumers are
stepping away from outsourcing
and favoring “made in Canada”
manufacturing.
Lack of trend adaptability.
6
PEST Analysis
Political
Canada and Japan continue to grow and share their
political, economic and cultural values which has resulted in continual and positive bilateral relations. International groups and organizations that include the
G8, Youth 8 summit, G20, APEC and ASEAN Regional
Forum, provide space for negotiations where both nations partner in opportunities to share their common
goals (Government of Canada, 2012).
Economic
Japan and Canada share strong trade and economic
relations that have been “steadily expanding” (Urstadt, 2010). For one, Japan is Canada’s largest bilateral direct investment partner in Asia. Furthermore,
both countries have strong export and import relations. According to Canada International, “Canada is
deeply committed to pursuing new opportunities to
deepen trade and economic cooperation with Japan”
(Urstadt, 2010). In two-way merchandise trade, Japan
is the fifth largest partner with Canada. To illustrate
the strength of Canada and Japan’s export-import relations, Canada’s export of goods reached $10.7 Billion
Canadian dollars while Japanese imports reached $13
billion Canadian in 2011 (Urstadt, 2010).
In March of 2012, both Prime Ministers met in Japan
to deepen trade and economic cooperation by launching negotiations toward a bilateral free trade agreement. A study was released afterwards known as
the “Report of the Joint Study on the Possibility of a
Canada-Japan Economic Partnership Agreement”.
According to the report, estimated GDP gains from
a bilateral free trade agreement would reach billions in U.S. dollars (Urstadt, 2010).
Socio-Cultural
The Japan culture is highly valued and it is a respected source of media and pop-culture. North
Americans are well aware of Japan providing excellent brands and products from Sony and Panasonic electronics to Honda and Toyota vehicles.
Japan and Canada cultures have enjoyed each
other through arts, films, music, literature and
comic books/manga (Government of Canada, 2012).
Furthermore, not only is Toronto Canada’s largest
city but it also possesses the country’s most comprehensive retail (Retail Insider, 2014). As a highly
urbanized city, Toronto is populated with fashion
conscious individuals who are well aware of high
end international brands such as Uniqlo.
Technology
The research and development department of
Uniqlo heightens their focus on research and
experimentation of materials to continuously improve the quality and functionality of their clothes.
Uniqlo also collaborates with companies like Toray
Industries to develop technological innovations in
fabric such as HEATTECH, an advanced combination of threading that creates a “renowned soft,
silky feel” (Fast Retailing, 2013, p. 32).
Retrieved from Google
7
Porter’s Five Forces Model
Threat of Substitute Products:
Low to Moderate
»» Easy to substitute non-referential plains
clothes.
»» -Difficult to match Uniqlo’s superior quality
combined with low price.
Determinant
of Supplier
Power
Buyer Power:
High
»» Over saturated
market.
»» Competition is
very high.
»» Most notable
rivals are H&M, Zara
and The Gap.
RIvalry
»» Over saturated market.
»» Competition is very high.
»» Most notable rivals are
H&M, Zara and The Gap.
»» Because the apparel
market is saturated,
consumers can easily switch
to other brands at no cost.
»» Apparel consumer’s are
generally price sensitive
and moderately to highly
knowledgeable of clothing
which partly explains
Uniqlo’s success during the
2009 recession, committing
to low prices (Fast Retailing,
2013).
Threat of New Entrants: Low to
Moderate
»» High rate of new entrants
»» Economies of scale is a factor that makes
it difficult to threaten already established
corporations like Uniqlo who have mastered mass
volume, superior quality at low prices.
»» Although visually Uniqlo may appear to be
undifferentiated, its superior quality at low prices
maintains substantial difference from other
brands.
Retrieved from Uniqlo.com
8
The Plan
To continuously provide fashionable, high
quality lifewear at the lowest prices in
the market. Uniqlo’s essence is of pure
functionality woven with innovative Japanese
technology, refined by culture. Uniqlo is stylish
apparel for everyone, for every occasion.
‘‘
‘‘
Mission Statement
New Marketing Objectives
Raise brand awareness in steps to dominate
apparel market
Position Uniqlo as the number one Canadian
retailer for casualwear, emphasizing highquality products and low prices
Increase Uniqlo’s market share in the Canadian
apparel market to 1.0% in Canada by 2022
9
Marketing Strategy
Product
Uniqlo is a brand that focuses on casual wear with an
influence of Japanese fashion. Their primary products
are for men, women, kids, and infants. Uniqlo’s product lineup consists of t-shirts, sweaters and pants
and other clothing in a wide variety of colours. They
are truly representing their products to the masses
giving them the option to customize their wardrobes.
For Uniqlo’s expansion into Canada, a focus will be
placed on the HEATTECH lineup, adapting to the needs
and wants of the Canadian consumer by producing
sweaters, fleeces and winter outerwear using the innovative technology. HEATTECH uses rayon and milk
proteins to trap the moisture of the body to generate
and retain heat (Fast Retailing, 2014). The Canadian climate allows Uniqlo to increase its utilize of the HEATTECH line and technology in Canada. Therefore, we will
introduce a brand new product line of parka jackets
made specifically to withstand the Canadian winter.
The Jackets will be exclusively sold in Canada and will
be the frontier product for the new HeatTech lineup
Retrieved from Google
for Canada. The jacket will utilize HEATTECH technology to infuse a comfortable, warm liner with Uniqlo’s
down jacket technology to provide layers of warmth during the cold months. The Parka Jacket is a new
development for Uniqlo’s product line. The introduction of the product will allow Canadian consumers to
feel entitled to the product that identify with their needs and wants. The Parka Jacket will be priced low, at
$150.00, which will be positioned competitively alongside other parka jackets in the market.
Uniqlo chooses functionality over fashion as their selling point, which has excelled their success in expanding with low-cost products. Uniqlo’s minimalist design retains high quality standards without following
fads and trends of its competitors. Uniqlo places its importance on craftsmanship for the masses, which
includes specializing in textile, sewing and dyeing (Urstadt, 2010). An example of Uniqlo’s craftsmanship is
their premium jeans that are made of Japanese selvedge denim. The jeans are made from a weave, that
continuously stitches a thread from the top to the bottom of the jeans, ending with a red stitching on the
cuff (Urstadt, 2010). Uniqlo’s emphasis on quality will allow them to differentiate its products from the competition. The unique approach of emphasizing quality and low cost is an opportunity that can allow Uniqlo
to reach its market share goal of 1% in apparel by 2022.
10
Price
One of the key contributors to Uniqlo’s success is their
low pricing strategy. This strategy makes their high
quality products affordable and widely accessible to
the general public. Customers can purchase t-shirts
for $6 US and cashmere sweaters for $30 with the
guarantee of a high quality product (Bhasin, 2014).
It is crucial that the low prices Uniqlo is known for are
reflected in the Canadian market, ensuring consumers develop trust towards the brand and its brand
equity. Prices will not be marked up strategically to
increase profits, but will be priced according to the
market ensuring consistent profit margins per unit
of clothing to Uniqlo locations globally. This sort of
pricing strategy and product offering allows Uniqlo
the opportunity to compete with and absorb market
share from its major Canadian competitors.
Offering high quality clothing
products at subsantially lower
prices is a core differentiator of
Uniqlo’s positioning
Price lower than
competitors
High quality
uncompromised
When introducing the flagship store at Yonge-Dundas Square, selective discounts will be utilized to attract
prospects to test-drive specific products, such as a cashmere sweater, with the goal that they will enjoy
the product, promote it through word-of-mouth and ultimately convert into a loyal customer.
Examples of Pricing
HEATTECH Parka
Jacket: $150
High Quality Denim
Jeans : $29-49
AIRism breathable
athletic shirt: $12
11
Place
The Uniqlo flagship store will be opened at Yonge and Dundas Square in Toronto on the first weekend of
December, 2015. We have decided not to open Uniqlo stores in shopping malls due to initial limited exposure.
The objective is to visibly expose Uniqlo to as many Torontonians as possible. Like the overwhelming lights,
billboards and giant screens that pervade downtown Tokyo, Yonge and Dundas Square is similarly situated
as a high traffic spot that attracts attention through its billboards, lights, street performances and other
attractions. Furthermore, by placing our flagship store in the heart of Yonge And Dundas Square we are
approaching a frontal attack against our competitor H&M which is also situated in the area.
Anticipating the success of the Toronto flagship store, the next phase will focus on store expansion throughout other major Canadian cities to increase Uniqlo’s market share. The outdoor presence of Uniqlo’s brand
is crucial as logos are absent on the actual clothing. The the location is also ideal for having easy subway
accessibility as the square is directly above Dundas station. The flagship store will have multiple levels
Proposed Location:Yonge-Dundas Square Area
Retrieved from Google
with different categories of products on each floor. The universal layout organization of Uniqlo stores will
continue in the Toronto flagship store.
The long-term goal of Uniqlo in Canada will be to open warehouses and distribution centers near the
retail stores. However, in the early stages of the Toronto expansion, Uniqlo will temporarily partner with
a pre-established distribution channel like Tiger Distribution. The plan is to maintain partnership just for
the first two years of Uniqlo’s presence in Canada. If
the flagship store meets our sales forecasts and solid growth is apparent, then we will confidently build
our own warehouse distribution channel for Canadian
locations in the country. The warehouse should not
be built until we see growth and success within the
Canadian apparel market.
Moreover, it is of high importance that we include a
viable and ready ecommerce service for all Canadians
across the country, to accompany the launch of the
Toronto flagship store. The e-commerce service will
increase Uniqlo’s market share to meet the objective
of a 1% share of the Canadian apparel market by 2022.
Yonge-Dundas
Square Facts:
»»Over 28 Million people pass
through the square each year
»»Growing in popularity as a central
downtown hub
»»Canada’s busiest pedestrian
intersection
»»Host of many community festivals
and events
12
Promotion
Uniqlo’s promotional strategies for Canadian expansion will be catered to the masses - deploying extensive
advertisements through billboards, posters, digital and social media campaigns. Through our promotional
push and pull strategies, the goal is to contribute to an increase of our market share to 1% by 2022.
Some promotional tactics that will be utilized are placing a pop-up store as a teaser before opening the
grand opening of the flagship. This tactic is designed to create buzz and awareness towards Uniqlo as a
brand. Out of home advertising such as billboards and TTC media buys will be utilized in order to showcase
Uniqlo to the people of Toronto.
Identifying the brand with secondary sources such as celebrities is a valuable strategy to appeal to our
target market. Our target market consists of men and women between 18 and 34, we will plan and execute
a free concert with the Grammy Award winning artist Pharrell to coincide with the opening day of the Uniqlo
flagship store.
By placing advertisements at TTC subway stations, Uniqlo’s brand
will gain a large amount of exposure by daily commuters and
passengers. This proposed media buy at Dundas station would be
seen by over 60,000 people daily. (Statistics from 2012-2013 ridership,TTC)
Incorporating local bloggers and blogs to write about
Uniqlo’s expansion in Toronto will allow communication with the target groups through influencers and
opinion leaders. Social media outlets such as Instagram and Facebook are direct outlets to the target group and their interaction and reaction to the
product. We can inform potential customers about
the qualities and technological developments that
Uniqlo has to offer. This media will include poster
campaigns highlighting variety of colours, quality
fabrics, dyeing and sewing.
13
Communications Strategy
To expand into the Canadian apparel market, it is essential that Uniqlo executes a marketing communications strategy which reaches the target market to raise brand awareness. The marketing communications
mix is designed to utilize various approaches and techniques to entice prospects in a variety of creative
manners. Furthermore, the marketing communications strategy will initially inform potential customers in
the market who are already aware of the brand while initiating curiosity to those who are not.
Out-of-home advertising techniques will utilize promotional
tools to raise brand awareness.
Billboards and promotional posters will be placed strategically
around the city to attract the
attention of potential customers,
raising brand awareness and
informing them that a flagship
store will be opening soon in
downtown Toronto.
Out of Home
Guerilla / Non
Traditional
Public
Relations
Events &
Experiences
Large billboard advertisements will be simplistic, focusing on the emphasis of Uniqlo’s logo, a phrase such
as “Coming Soon”, the inclusion of links to the company website and Uniqlo’s Canadian social media outlets.
This technique will not only entice curiosity for our target market of being unaware of the brand, but also
stimulate consumers with pre-existing brand awareness, pulling prospects to research the details of Uniqlo’s launch into the Canadian market. The inclusion of website and Canadian social media links are also able
to educate consumers lacking brand awareness.
Moreover, we will implement a full takeover of TTC’s advertising space within subways, buses and streetcars. The purpose of the posted ads in transit is to educate and inform the commuting target market of
Uniqlo’s innovations in fabric technology as well as their brand line, according to season. To take advantage
of commuter travel time, the target market will have sufficient time to read the posted informational ad on
Uniqlo’s fabric technology. For the winter season, diagrams focusing on the science of Heattech technology
will promote the company’s brand equity as the innovative provider of winter wear that best fights the winter cold. We will also accompany the science education with basic ads of models, including musician Pharrell
Williams, wearing the season’s clothing line. Similarly, for the Summer season, the focus will steer towards
the technology of AIRism for fighting sweat and moisture, accompanied with a set of ads with models wearing the Summer line. Furthermore as posters are placed side by side, dominating the entire ad space of a
given subway, streetcar or bus, each poster will consist of a specific color theme, thus presenting an entire
array of colors to the TTC commuter. This will also meet our objective of positioning our brand for having the
widest selection of colors in the general apparel market. Lastly, Dundas station will be appointed as the sole
station to accompany Uniqlo advertisement. Exclusively posting ads in Dundas station is a means to inform
passing commuters that the location of the flagship store is indeed on Yonge and Dundas Square area.
14
Guerilla/Experiential
Guerilla and word-of-mouth marketing techniques
will be used as a teaser campaign to stimulate brand
awareness and curiosity. Organized in co-operation
with the City of Toronto, a red shipping container will
be placed at Yonge and Dundas Square in August of
2015, three months prior to the opening of the flagship store. The shipping container will be decorated
solely with a Uniqlo logo and a countdown number
which will be re-painted each day. The shipping container will be left unattended for seven days. On the
Goals
»»Spark the curiosity of passers
by
»»Stimulate social media
attention
»»Get stunt featured in key blogs
and media news outlets
»»Increase awareness, and spark
interest in learning about what
Uniqlo is about
Location of Shipping Container
at Yonge-Dundas Square
seventh day, the container will be opened up as a
pop-up shop selling Uniqlo clothing for the entire
Labour Day weekend. This tactic will create a buzz
on social media, news outlets, and the blogosphere.
Once the pop up store opens, the official date for
the Yonge-Dundas square location will be announced
making Uniqlo’s official presence in the Canadian
market known to the general public.
Timeline
»»Place container at Yonge-Dundas
Square
»»Repaint numbering on side of
container, counting down from
seven days
»»On final day, container will be
opened and transformed into a one
day pop up store for Uniqlo
»»During event, announce official
opening of flagship store at YongeDundas Square area
15
Public Relations
In relation to the strategic execution of the pop-up store and flagship locations, a press kit will be designed
and distributed to news outlets and blog sources as accompaniment for the coverage that will surround
the grand opening of each location. The press kit will include articles and information designed to create
positive publicity for Uniqlo by promoting the functionality of its products, its innovative fabric technology,
and high quality, low cost business model. The material included in the press kit will introduce Canadians
to Uniqlo’s history, its Japanese heritage, values in social responsibility and growing popularity worldwide.
Events & Experience
The final tactic will be to utilize a secondary source
affiliation with the brand by holding a free concert at Yonge and Dundas Square for the flagship
store’s grand opening. The new creative director
of Uniqlo UT is NIGO, a japanese fashion designer
and music producer, who has a strong friendship
with Pharrell Williams. The concert will be free
through sponsorship from Uniqlo in an effort to
raise brand awareness and attention. Our target
group retrieves information through popular outlets like music and digital media. The free concert
brings positive emotions and feelings where it can
be associated to the Uniqlo brand. The associations create a bigger dynamic of what the brand
represents. The one-time concert will be remembered through pictures, video and audio to create
a memorable memory of the event that took place
with Uniqlo sponsorship.
NIGO
PHARRELL WILLIAMS
Retrieved from Google
16
Market Analysis
The strategy of Uniqlo starting the Canada expansion by opening a single flagship store in downtown
Toronto, the company’s share of the market will be low until further expansion is implemented. It can
be expected that H&M and Zara will remain important retailers in the Canadian market and most likely
grow their current apparel market shares of 1.1% and 0.4%, respectively (Passport, 2014). Furthermore,
it can be projected that Nike will retain and possibly grow their 3.2% share of the menswear market
(Passport, 2014).
In addition, successful department stores such as Nordstrom and Saks Fifth Avenue, are expected to
enter the Canadian market by 2016 (Kopun, 2014). The entry of these two companies will further add
competition to an already congested market.
Sales Forecast
In the Uniqlo Annual Report, the average sales per square metre of each location was approximately 933,000
yen during the 2013 fiscal year (Fast Retailing, 2013, pg. 45). To apply these figures to the Canadian market,
we must convert the value of 933,000 yen per square metre to the equivalent dollar amount per square foot.
Therefore, annual sales per square foot would be 86,710 yen, or $830 per square foot per year. For example,
if the flagship location measures 40,000 square feet, we can estimate that the ideal base case scenario is
$33,200,000 (40,000 x 830) in sales.
According to Statscan, Canadian apparel retailers saw an average increase of 4.1% in net sales in 2014 (Statistics Canada, 2014). Therefore, we can forecast that the sales of our flagship location will increase at an
average rate of 4.1% year-on-year. Below is a chart that displays the sales forecast for 5 years based on the
average sales of global Uniqlo locations.
Year
Amount Increased
2016-2017
Yearly Sales Forecast
$30,200,000
2017-2018
$1,361,200
$34,561,200
2018-2019
2019-2020
2021-2022
$1,417,009
$1,475,106
$1,535,585
$35,978,209
$37,453,315
$38,988,900
Market Share
Uniqlo sets ambitious growth objectives, planning to aggressively expand locations to increase their global
apparel market share (Fast Retailing, 2013, pg. 45). Currently, Uniqlo is growing at a global rate of 23% per
year (Fast Retailing, 2011). To apply the growth rate of 23% to Uniqlo in the Canadian market, it is not realistic
as the flagship in Toronto will be the first expansion location in the country.
Figures for the market share growth of specific locations are not available and could not be used as a
benchmark. However, Due to Uniqlo’s aggressive expansion model and with profitable sales figures and the
addition of flagship stores in Vancouver, Montreal, and other powerful retail markets in Canada will help to
grow Uniqlo’s market share at a greater rate than .1% per year. As Uniqlo expands further into the market,
meeting the objective of 1% market share by 2022 will become increasingly attainable.
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Contingency Plan
Preemptive measures have been built-in to Uniqlo’s Canadian expansion plan to minimize risk. To reduce
the costs of opening a warehouse and distribution centre in Canada, a strategic partnership will be created
with a company who specializes in distribution and logistics, such as Tiger Distribution. Within two years, if
sales figures meet expectations, Uniqlo will begin to roll out its own warehouses and distribution centres
to support the flagship location and e-commerce sales.
If Uniqlo’s Toronto flagship location dramatically underperforms in its first two years of operation, a contingency plan will be executed to vacate the flagship store at Yonge and Dundas Square. However, Uniqlo
will continue to offer apparel through the ecommerce channel established during initial expansion. This will
allow Uniqlo to continue to compete in the Canadian market, providing apparel to those who are interested.
The e-commerce channel will also allow Uniqlo to implement online marketing campaigns to revitalise their
brand image. After revitalising the brand image, Uniqlo will reposition to stimulate new demand with the
goal of opening another flagship store in the future.
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