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ASOS SHIFTS THE FOCUS OF HIGH-STREET RETAILING ASOS has pioneered online social shopping and is one of the most successful online fashion retailers in the UK. ASOS offers tends of thousands of branded and own-label fashion items to millions of twenty-something men and women around the globe. This case study explores the growth and competitive strategy of this iconic online retail fashion brand. Nick Robertson and Quinten Griffiths, founders of As Seen on Screen (ASOS), were inspired by watching American TV series Friends, and these friends set about building a website that could sell items that potential customers had seen on television. Initially, ASOS sold copies of clothing worn by celebrities, but soon the company began developing its own brand. This focus enabled the company to start to build a reputation that was attractive to young fashion shoppers. By 2004 ASOS had introduced its own label women's wear and since has achieved the following landmarks: 2006 - become the first company in the UK to launch online catwalk shows 2007 - launched ASOS own-label for men 2010 - began expanding internationally into Europe, Russia and USA and established sites to serve these markets and launched ASOS marketplace . 2011 - apps launch and Australian, Italian and Spanish sites established 2012 - began to consolidate online expansion, opening international offices in Sydney and New York 2015 - partnered with Paypal to connect directly with students' markets 2016 - invested in Artificial Intelligence and voice recognition to improve social media applications 2017 - market valuations made ASOS more valuable than M&S, the UK's largest seller of clothing ASOS has grown into the UK's largest online fashion retailer by deploying a competitive strategy, which has established a unique market position: selling a specialist range of products that have "the designer fashion look". Nick Robertson started selling branded dothing as seen in films and television. Not only did this enable the company the opportunity to create a market, but it also benefited from celebrity endorsement in PR and promotional campaigns. ASOS operates as a fast-fashion retailer, which has meant overcoming many challenges to get goods to the customers on time and at the same time manage the high rate of retums. ASOS has set up systems that enable product lines to be replaced quickly. Online value proposition Product choice is at the core of the ASOS proposition: tens of thousands of branded and own- label products available, with hundreds introduced each week. On pricing, ASOS is price competitive with its Price Promise (a price match offer): if you see a branded (non-ASOS product cheaper on another website, the company will match the price. ASOS describes its website as "evolving constantly as we find better ways of presenting our products". ASOS Service For ASOS, speed and accuracy of deliveries to customers is a critical success factor. By offering same-day deliveries the company has increased sales by 23 per cent in the UK and even more in the RU. Underpinning these improvements in sales is an innovative ethos that is evident across the company. ASOS invested in a customer contact management system that enables staff to respond to customer care emails more quickly and efficiently. Working with Clipper Logistics, they have introduced an innovative reverse logistics system called Boomerang, which provides quick turnaround on inventory when products are retumed. A primary strategic objective is to continually innovate to "add convenience and choice for ASOS shoppers". Marketing communications ASOS brand magazine has a circulation of nearly 500,000 and reportedly is the "most widely read quarterly fashion magazine. The magazine reaches more than 700,000 when including France, Germany and the US in the circulation figures. eWord of mouth is a powerful tool of this brand and able to leverage advantage through links o celebrities and fashion using the ASOS Insider Community, which is a marketing initiative that uses individuals and their fashions insights to build digital content. These digital influencers not only share their fashion favourite via their social media, but also have an "Outfit of the Day". Which helps drive sales of spe cific products ASOS Foundation is central to the ASOS corporate social responsibility strategy, which again contributes to the brand's market positioning. The Foundation seeks to support disadvantaged young adults in the UK, Indian and parts of Africa. Projects involve finding ways to develop sustainable improvements in these areas: a social enterprise in Kenya that works from an eco- factory producing African-inspired fashion designs; education in artisan skills in remote parts of Africa; and working with the Prince's Trust in the UK to help young people develop the skills they need to get jobs. Social media marketing The growth of the company in recent years has largely driven by social media. ASOS has contributed a great deal to the digital high street. Apart from showing that it is possible to sell fashion online profitably, the company has also pioneered social shopping, where customers use online social network sites to share product ideas before the buy. ASOS has successfully used social media to build a community of fashionistas who are prepared to share their views and opinions on Facebook, Twitter and Google Plus and to share ideas of what to wear, giving its young shoppers fashion inspiration. Basket Analysis Basket analysis approaches were implemented by ASOS. The analysis shown that men tend to buy for their partners as well as themselves. Based on the data, the editorial team will generate email with the generic content of the current fashion trends and "best-buy" recommendations. The personalised content took into account favourite brands and budget, recommending items below a certain budget. Emails were sent twice a week. Other strategies such as encouraging customers to refer a friend to the company, and sending viral campaigns, were also used at this time. Ultimately, ASOS had developed a large target audience for its products through the use of digital media and it is able to communicate new product ideas very effectively to keep customers interested. ASOS's innovative use of social media has enabled it to influence the way young shoppers interact with online fashion retailers. Source: Adapted from Chaffey & Ellis (2019) Digital Marketing, pp 182-184 Based on the case study above, answer the following questions: . Apply the SOSTAC model to ASOS and highlight why it has become such a successful online fashion brand (40 marks) 2. List five (5) elements of the marketing mix that ASOS used as part of its digital strategy. (5 marks) 3. Identify five (5) ways how ASOS has used digital to develop its differentiated market position. (15 marks) Explain three (3) reasons why digital media is a suitable communication tool for ASOS in managing relationship marketing with its customers (9 marks) 5. Explain what could be the legal and ethical constraints that ASOS faced in implementing relationship marketing using digital media. (6 marks)