UNIQLO IN

RUSSIA
Group 2
Presentation

Dr. Ying Yueh, Su

2019/12/18
 GROUP
MEMBERS
 周紀繡 Jennifer
A8227295
 阮明淵 Ivy
A8235352
 馬麗賢 Abii
A8236421
 楊書維 Jessica
A8227139 2

 曾薏安 Ann
 CONTEXT OUTLINES

1. BACKGROUND ANALYSIS
2. MARKET SELECTION
3. MARKET ENTRY
4. PRODUCT STRATEGY

3
1. BACKGROUND
ANALYSIS
1.1 Russia background and element of
International Business Environment

• The largest country in the world with

the land 6.6 milion sq mi and has
147 million people.
• Russia has an upper-middle income
mixed economy with enormous
natural resources like oil and gas.
• Ranks the 12th largest economy in
the world by nominal GDP and the
6th largest by purchasing power
parity.
• Russia has 12 economic zones. 4
 Element of International Business
Environment • Cultural Differences:
attitude, norm.
• Operational Problem : high labor cost • Negotiation pattern:
• Competitive intensity: Russia’s company straight and
are more competitive which focus on comprehensible
productivity and efficiency Cross- • Decision making
Commer culture
cial Risk styles: High context
Risk culture.
• Corruption: the most corrupt country
• Political unrest: Opposition-led and non-political protests
Country Currrenc
may disrupt and hurt international IT companies whenRisk the y Risk
Government provide strategy to undermining these
protests. • Inflationary and
• Terrorism: Homegrown terrorism, increasingly driven by transfer pricing: Still
radicalized youth from Muslim communities and the return have inflationary but
of Islamic State militants from Irag and Syria are likely to reduced significatly in
pose a security risk to Russia and its neighbors. recent
5
1. BACKGROUND ANALYSIS
1.2 UNIQLO
• UNIQLO Co., Ltd. is a Japanese casual wear designer,
manufacturer and retailer. The company is a wholly owned
subsidiary of Fast Retailing Co., Ltd.
• UNIQLO began its global expansion in the UK in 2001. Its first
store in Russia was opened spring 2010.
• The UNIQLO store - UNIQLO ATRIUM housed in Moscow’s
top class shopping center ATRIUM, a prime facility for global
fashion brands. As a commercial facility in the very heart of
Moscow, this shopping center is top class in terms of customer
attraction and branding.
• By August 2019 there were 36 UNIQLO outlets in the country, 6

20 of them in Moscow.
1.2 Product: HEATTECH clothes

7
What is HEATTECH?
HEATTECH is the clothes
that generates heat from
your body.
It is made from bio-warming
material, providing warmth
without bulk. It uses
technology to convert body
moisture into heat, keeping
you comfortable all winter
long.
8
1. BACKGROUND ANALYSIC
1.2 SWOT OF UNIQLO
STRENGTHS WEAKNESSES
• Commitment in divergence which supports the • A multi-layer distribution structured
individuality of each family member as well as industry; distribution digestibility is hard,
those with fashion-forward and edgy people. leading to clogging in distribution
• High quality products for its global materials inventory.
procurement • UNIQLO is also originally designed for
• A clear vision of its brand “Made for all”. Its low-end consumers
clothing is up-to-date and fashionable, but not • They are low at designing because Uniqlo
trendy. is Japanese brand , Japanese people love
• Sound operational strategy by using Voice of simplicity
Customer as brand strategy
• An expert in store development thereby efficient
store operation in addition.
OPPORTUNITIES THREATS
• Globalization provides higher technology, materials, • Foreign currency affects the business conduct.
facilitating the exchange of information with speedier • Intense competition
level. • Its stand in apparel industry may be changed
• The potential teenager market could help UNIQLO according to customers 'influences. 9
exploit
 2. MARKET SELECTION
2.1 Concentration VS Diversification
Diversification Strategy
• A strategy that an organization
adopts for the development of its
business. This strategy involves
widening the scope of the
organization across different
products and market sectors.

10
 • Have a largest population
Target • Place that is concentrated political,
Place
economic, science, culture activities.

2. MARKET SELETION • The main target is female and male

Target adults that are ranging from the age 18
Custome to 40 of every class.
2.2 Target Market r • The people who are looking for trendy
clothes which are casual and laidback
Identification
Diversification Strategy
Using related diversification and avoids risky experiences in Russia, also
increased competition and asserted with other competitors. However, some
examples of UNIQLO’s unrelated diversification are offering merchandise 11

from fridges, shirts, glasses to pens.

2. MARKET SELECTION
DIVERSIFICATION IN PRODUCTS

IN MARTERIALS IN FORMS

12
 MARKET ENTRY ANALYSIS

✔ Geographical variables: region, terrain, traffic

Shop opening location more choice in the city's large shopping malls, flat terrain, convenient
transportation and high population density.
✔ Demographic variables: age, gender
Most of the consumer groups are women aging between 18- 40 years old.
✔ Psychological variables: personality, lifestyle, social class
Consumer groups value personal characteristics, high sensitivity to fashion and their lifestyle pursuits are
close to fashion trends and their social class tend to the working class, the lower middle class and
students.
✔ Behavioral variables: loyalty, pursuit of benefits, purchase preparation period
Many single young women who always want to stay on top of the fashion trends are constantly
upgrading their closets with UNIQLO new affordable items. Therefore, the consumer loyalty to the
brand is not high. Consumers pursue fashion, with short and fast purchase. 13
 • HEATTECH is the result of collaboration between
UNIQLO and Toray Industries (India) for developing
technology and manufacturing to meet the need of
UNIQLO’s high quality standards
3.MARKET ENTRY • Fast Retailing Co., Ltd chose joint venture strategy (a
form of FDI) for UNIQLO in Russia. And its partner is
Mitsubishi Corporation.
3.1 Market Entry • Both companies are committed to jointly expanding
Strategies UNIQLO (RUS) operations going forward.

Joint
Venture
Strategy 14
4. PRODUCT Product
STRATEGY
4.1 Product selection
Price
for target market
Place
4 P’s of
Marketing Promotion
 4. PRODUCT STRATEGY
4.1 Product and Service Selection for target market
• Deliver warmth to winters by create heat (Heat Generation) and
keeping heat( Heat Retention).
Function • Innerwear for fashion styles
PRODUCT

• Simple, knit
• Divide into three categories: HEATTECH, EXTRA HEATTECH
Product and ULTRA HEATTECH
• European sizes.

• Return or exchange within 30 days from the date of purchase for

product is in new and original condition with price tag and sticker
Warranty
• Return or exchange within 6 months from date of purchase for 16
manufacturing defective product
4. PRODUCT STRATEGY
4.1 Product and Service Selection for target market

• Affordable and reasonable price so that every class can

Selling Price purchase. They will realized that even if you are not
millionaire you still can lead high quality life
PRICE

Payment • Credit/Debit Card

• Master/VISA Card
Methods • Cash

• 10% discount if you are UNIQLO’s membership.

Discount • According to Russia seasons and holidays also other
International Special holiday (Black Friday, Christmas,…)
17
4. PRODUCT STRATEGY
4.1 Product and Service Selection for target market

Destinations Distribution
PLACE

Moscow Its country of origin

Saint Petersburg
Moscow Oblast

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4. PRODUCT STRATEGY
4.1 Product And Service Selection For Target Market

• Roger Federer-Tennis great

Sponsorship star
PROMTIO

• Internet: Vk.com, Facebook,

Twitter, Instagram
Advertising
N

• Traditional ways: TV and other

media

• Helping young mothers and

Corporate social kids from orphanage project
responsibility (CSR)
to spread out their ideology
“Clothes for smiles”
19

Note : Vk.com (Vkontakte) is the famous social media in Russia

4. PRODUCT STRATEGY
4.1 Service selection for target market

E-commerce Gifting Service

• Local Language • Message Card

Website/App • Gift Wrapping
• Bulk Ordering • Gift Boxes
• Shipping • Gift Card
• Customer Care( Q&A,
suggestions…)
20
 4. PRODUCT STRATEGY
4.2 Standardization VS Adaption

Standardization Adaption
• Standardization is the • A strategy that anticipating
process of creating standards the adverse effects of climate
to guide the creation of a change and taking
good or service based on the appropriate action to prevent
consensus of all the relevant or minimize the damage they
parties in the industry can cause, or taking
advantage of opportunities
that may arise

STANDARDIZATION STRATEGY and ADAPTION

STRATEGY 21
 4. PRODUCT
STRATEGY
• Using Adaption Strategy for
customer service like creating
an own website for Russian
market and local labor for
manager position.
• Using Standard Strategy for
brand philosophy” Made for
all” with same HEATTECH
functions, styles. Moreover,
they held some meaningful
programs across many country.

ADD A FOOTER 22
• Russian trend-setters and celebrities mixing it with lux brands, Russian office
workers and students enjoying clean design in bright colors, Russian house-
keepers and kids wearing warm comfortable and beautiful clothes every day,
almost every Moscow citizen wearing Uniqlo ULD in Russian unpredictable
weather. HEATTECH change the shopping behaviors from following trendy to
following functional clothes.
• UNIQLO Europe achieved rising revenue and profit, with sales reaching the
100 billion yen, and the Russian operation continuing to generate especially
strong revenue and profit gains.

23

RESULT SUMMARY IN RUSSIA

4. PRODUCT
STRATEGY

4.3 Suggestion

24
 4.3 Suggestion
UNIQLO can expand
into Russia’s less
developed areas as
competition intensifies
in the largest cities in
the Asian nation.
UNIQLO can gain profit by locating stores in some less developed areas like Yekaterinburg,
Samara or Novosibirsk to gain more profit from Europe market in believing that comfortable
price and multi-function of HEATTECH will satisfy the Russians.
 4.3 Suggestion
“The whole country is definitely
getting more competitive,”
Persson said, UNIQLO should
acknowledge new rivals and
international retailers that are
improving and expanding in the
country.
Find a partner in Russia like Nina Donis which has the same ideology to create simple yet
modern collection include simple silhouettes, pure colors. This might be a good choice to 26

understand the Russian fashion market and improve fashion design for HEATTECH
4.3 Suggestion

More artist
collaboration in
Russia beside Maria Sharapova
Famous Tennis Player
BT21,Takashi
Murakami, Andy
Warhol.
Sasha Spielberg 27
Famous Actress
 4.3 Suggestion
UNIQLO should develop their
materials and technologies in
the design for HEATTECH to
attract more customers
according to Russia market
analysis.

According to its clear and brand focus “Made for all” which was UNIQLO strength by but also weakness
by its simple. However, instead of chasing fashion trend, UNIQLO focus on research and development
to constantly improve on its brand innovates. Russians love to own the latest in innovative design,
28
and
especially when products are kept affordable.
THANK YOU 29