Uniqlo is a Japanese casual wear designer, manufacturer, and retailer. The name is a portmanteau that combines the words unique and clothing, which reflects the company’s philosophy of creating simple yet stylish casual clothing. Uniqlo has quickly developed a presence around the globe, expanding to over 1,500 stores worldwide and competing with Zara and H&M to become the world’s largest fashion retailer In 2017, Uniqlo reported over $7 billion in revenue.

Founder Tadashi Yanai inherited his father’s chain of tailoring stores in Ube, Yamaguchi, in 1972. Inspired by large clothing chains in Europe and the United States, Yanai saw potential in the Japanese casual wear market and changed his family’s business strategy from tailoring to selling casual clothing at low cost. After becoming company president in 1984, Yanai opened the first “Unique Clothing Warehouse” in Naka-ku, Hiroshima, which later was rebranded as Uniqlo. One of Uniqlo’s first business challenges was to overcome customer perception. Because Uniqlo sold casual clothing at low cost, people believed that its garments were of low quality. It wasn’t until 1998, when Uniqlo opened a three-story store in Harajuku, one of Tokyo’s most popular shopping destinations, that consumer perception changed. Consumers noticed that Uniqlo was selling high-quality fleece jackets at affordable prices. This precipitated a complete shift in customer perception of the brand—from cheap apparel to high-quality, affordable casual wear. By the end of 1998, Uniqlo had expanded to over 300 stores across Japan. Compared to other popular clothing retailers, Uniqlo’s brand philosophy takes a very simple and inclusive approach.

Its brand message is that “Uniqlo is a modern Japanese company that inspires the world to dress casual.” Unlike clothing retailers such as Zara and H&M, Uniqlo does not seek to follow fashion trends. Instead, Uniqlo designs and markets its clothing to be accessible and universal, a key ingredient in the company’s success. This is embodied in Uniqlo’s brand motto, “Made for All.” Uniqlo has designed its clothing to appeal to all consumers, regardless of age, ethnicity, or gender. The clothing is basic but still allows wearers to express their own sense of style by pairing it with other garments and accessories.

Uniqlo creates products for three primary segments: women, men, and children, including babies. In each of these three segments, Uniqlo sells five different types of clothing: outerwear, tops, bottoms, inner-wear, and home-wear. In the outerwear category, Uniqlo is known for its Ultra-Light Down jacket, which is light and thin but still provides excellent insulation.

Tops include mainly basic dresses, blouses, T-shirts, polos, and sweaters. Uniqlo’s bottoms include pants, shorts, skirts, and leggings. Uniqlo offers designer collections in the tops and bottoms categories, for those seeking a more stylish flair to their wardrobes. Most Uniqlo inner-wear and home-wear is specifically designed with comfort in mind, varying in breathability and warmth...................

Questions

1. What are the key aspects of Uniqlo’s customer value proposition?

2. Should Uniqlo stay vertically integrated? Or should it rely more heavily on outsourcing to improve flexibility and achieve economies of scale?

3. What role does the company culture play in delivering superior customer experience?