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News Bites | Uniqlo's US Ambitions, MatchesFashion's Record Results

In today's News Bites, Uniqlo’s John C. Jay on the apparel giant's plan to dominate American retail, and Matchesfashion releases its financial results for the first time.
Uniqlo Autumn/Winter 2017 | Source: Courtesy
  • BoF Team

Welcome to News Bites, BoF's regular feature of the stories that get the industry talking.

Uniqlo’s John Jay says, “We will win in America come hell or high water.”

To begin to understand how serious Tadashi Yanai's intentions are for dominating the fractured American retail landscape, one must only consider that the Uniqlo chief executive and founder's 2017 address to the company was based on jazz saxophonist Charlie Parker's 'Now's the Time':

Go for glory, tell you the story
Out payin' our dues until we found we were
assisting at an unexpected borning
'twas the birth of the Cool

“That’s only a hint of his love for America and his respect for American culture,” notes John C. Jay, president of global creative at parent company Fast Retailing. “He understands fully that the raw material, the ingredients that we get to work with — sportswear, casualwear — those are US inventions. We would not be happy if we did not win the hearts and minds of America.”

After a series of fits and starts in the US linked to size and style issues, as well as inconsistent messaging and underdevelopment of the brand, Uniqlo is doubling down on the market, closing stores at second and third-tier shopping malls and opening new ones in target-audience cities like Denver and Chicago. While Fast Retailing doesn't break out revenue numbers for the US market, the company said that sales at Uniqlo USA began to improve in the second half of the fiscal year ending in August 2016. However, the business is still not profitable: Losses were larger in 2016 than in 2015.

“We haven’t done a great enough job at connecting,” explains Jay, who is in New York to present Uniqlo’s clarified vision for its overarching concept — LifeWear — to American editors.

People's lives are changing. To stay relevant we need to understand what their needs are.

Jay was joined by Yanai and other top executives, including research-and-design head Yuki Katsuta, at a preview at Spring Studios on Wednesday. Yanai kicked off the event by presenting new marketing creative around LifeWear, conceived in partnership with the agency Droga5, while Katsuta later announced the retailer's latest collaborator — J.W. Anderson — within a showroom that featured next season's wares, including the latest collections from Uniqlo U (designed by Christophe Lemaire), Ines de la Fressange, Mickey Blue and Hana Tajima.

Jay, the former global executive creative director of Wieden & Kennedy, best known for its work with Nike, joined Uniqlo in late 2014 and has been tasked with helping to better communicate the retailer’s mission of designing clothes that are essential to everyday life. “To make an impact from a marketing standpoint, we have to look at what’s going to work regionally,” he says. “It can’t be one size fits all.”

Along with creating regionalised marketing campaigns, the retailer is also hiring design talent to work out of its research and development centres across the globe, including in New York and Los Angeles, where the company operates a denim innovation lab. “Marketing is only as good as its product,” Jay says. “People’s lives are changing. To stay relevant we need to understand what their needs are. The world doesn’t need another apparel brand.” Jay, who began his career at Bloomingdale's, says that the company has learned a thing or two from the stumbles of its US counterparts, which have suffered from overstoring and sluggish supply chains.

And while Yanai's long-standing goal to make Uniqlo the number one apparel retailer in the world — it's currently number three — could be achieved by accelerating growth in other regions as well as online — another big area of focus for 2017 — the US is too important to the executive to give up just yet, even though he has publicly expressed dismay for President Trump's isolationist policies. "That may be true from a mathematical standpoint, but that would never sit well with us," Jay says. "We will win in America come hell or high water." — Lauren Sherman has released its financial results for the first time, revealing 61 percent year-on-year growth.

A detailed report discloses that full-year revenues for 2016 were an impressive £204 million. Not only did the company enjoy record growth in all markets — 45 percent in the UK and over 80 percent in the rest of the world — but 2016 also saw total online sales increase by 73 per cent, with the website enjoying 55 million visits.

The announcement of these successes comes 10 years after the boutique's 2007 venture into e-commerce, which later contributed to a rebranding of the company as in 2013. Today, the luxury fashion retailer represents 450 brands, with its global e-commerce platform generating 95 percent of sales, according to the Financial Times.

“In recent years we have focused on building the foundations — of people, operations, and technology — to enable future growth, with a focus on driving an agile business at scale,” said executive co-chairman and co-founder of the business Tom Chapman in the report. “[This] year we continue to look to the future of luxury commerce and how we can keep innovating to drive profitable growth, deepen our relationships with customers, and inspire our team.”

The company, which celebrates its 30th birthday this year, has come a long way since its beginnings as a small boutique in London's Wimbledon Village. Now a major e-commerce player competing with the likes of Net-a-Porter and My Theresa, this report would suggest the company is poised for continued success in the coming year. — Tamison O'Connor

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