Topshop Strategy
Top shop marketing plan essay Executive SummaryTop Shop is one of the leading retail brands known globally for its most up-to-date styles in clothing and other fashion accessories. Earlier only a low price clothing outlet primarily for the teenagers, Top Shop is now the hottest fashion clothing brand with its stores keeping the latest fashions and the exclusive and extraordinary designs that appeal to all age and socio-economic groups.
The management has very carefully followed a perfect blend of cutting edge, highly fashionable styles with affordability by introducing new products and services in various countries worldwide under the new company called ‘TOPSHOP plus'.
Realizing the importance of doing so, after repositioning itself, Top Shop will embark upon a carefully planned journey of simultaneous product and market development strategy as ‘TOPSHOP plus' Be it Kate Moss's exclusively introduced designer range, in-store ambiance, Style Advisor service or its sponsorships for the young and aspiring fashion gurus, Top Shop stands out today amongst many other competing brands. The management must, however, bear in mind that while expanding into so many countries with its every increasing range of products, it would have to keep a very strict check on its supply chain.
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Furthermore, regular innovations are a key to success for this mighty brand. For as this growing company approaches maturity, it would run a greater risk of the competitors catching up until it commits to innovations that are hard to imitate or are at least time and resource consuming. Terms of ReferenceAim of the ReportThe report covers discusses ‘TopShop plus' an extension of the Arcadia chains conception and launch as an expansion to strategic measures taken since the time that transformed itself from being an ordinary low price clothing retailer for the teenagers to a hot fashion clothing hub for all age groups.
It also brings forth various marketing promotions being undertaken by the company to maintain its current position and to gain on the market share. The in depth analysis helps understanding how each of its activities have been attempting to attract customers through provision of maximum value to them and not to the company only. The later part also suggests that despite being and extraordinary fashion retailer, there are a few areas where Top Shop would need to pay special attention in order to ensure long term growth and a sustainable bottom line.
Scope of the ReportAs one of the businesses of the Arcadia Group, ‘TopShop plus' strategic marketing analysis has been provided in this report keeping in view all of its products and services. The services that make the shopping experience more of an entertainment are just as important a factor in Top Shop's success as are products that directly produce revenue for it. In a nutshell, the report analyzes Top Shop as a whole through its separate products and services which also act as tools for marketing for the company. 1.
The CompanyWith an initial reputation of being a tacky low price clothing outlet, Top shop ‘plus' has now earned the fame of a leading store when it comes to fashion clothing. The success, however, came only with a change in its strategy; by going ‘upscale'. Top Shop ‘plus' will be one clothing retailer that stocks the most up-to-date fashion clothes and accessories before any of its competitors does in the market. Whereby the major focus earlier on was on price competitiveness, Top Shop ‘plus' products will arrive first in the market and will be of high quality and very low comparative price.
Over time, Top Shop ‘plus' will come to be known not only as just the fashion accessory provider but much rather a trend setter especially with its in-house designer brands and those exclusively introduced and introduced by fashion industry leaders. Due to its various marketing efforts, innovations in the business and exclusive services for its customers, it is now the biggest and the most differentiated name in the fashion industry especially when it comes to retailers in the field. 2.
The Fashion Retail Market at a GlanceA study showed that even while cutting down on other areas, the European consumers hardly cut down on their expenditure on clothes (Mintel, August 2003). Even when the year on year sales in the fashion industry slowed down in 2000 and 2001, the change was not as drastic as had been predicted by certain observers. During that period, Top Shop and some of its competitors caught up on the opportunity to provide fashion clothing at an affordable price.
Few of the major players that have dominated the fashion retail industry with a reputation to preempt the latest catwalk designs include Top Shop, H;M. and Zara. Now, Top Shop is amongst the very few names that account for more than 60% of the total consumer expenditure on fashion clothing and accessories. 3. Current Marketing Activities:Arcadia group plc under Top Shop has been engaged various marketing and promotional activities. The most major ones and their analysis with reference to the company's corporate & marketing strategy follow this section. . 1 New ImageLong ago, when Top Shop was only known as a low price clothing outlet, the increasing focus of the buyers on trendiness and the readiest availability of the new fashion accessories forced the managed to rethink its strategic position. Right at that time, the management decided to reposition Top Shop from being a discount seller to a hot trend setter brand. Initially, Top shop relied on copying the latest catwalk designs and releasing them in the market before any other competitor like H& M and Zara.
Gradually however, while the other fashion brands focused following the same copying the strategy, Top Shop entered into the arena of introducing new self made designs initially under a brand named Unique. Since that time, Top Shop has been living the repute of being the high style up-to-date fashion god of the high street. Consider the following perceptual map taking bullet 1 as its initial and 2 as its later positioning with respect to certain other competing brands such as Marks & Spencer, H&M etc. Refer to 1c and 2c as the composite competitor positioning before and after Top Shop's transformation. . 2 High Price-High Quality Fashion ClothingPreviously, for quite some years, Top Shop had to experience low revenues and even lower profits primarily because of its excessive focus on price competitiveness. Later a shift its strategy helped the bottom line to sore up. The major factor contributing to such a result was the chain's new focus on female fashion clothing and accessories that it brought into the market before its competitors even if it had to pay more to the suppliers. Such a strategy assisted it in becoming a market leader where it came to the latest trends and fashion in the women-ware.
It is also important to note that Top Shop offers products at usually a very low price even as low as three times comparative to the competitors. But because the customers get access to the latest fashion only here, the revenues at Top Shop are only positively affected. More so, with its discount offers such as those especially designed for the students, it can rest assured that even the young age groups can afford the trendy ware that it has to offer to its customers. Additionally, because ‘fashion' is this chain's selling point, the customers are often ready to pay a premium price for certain designs.
In this manner, it is able to maintain an upscale image as well as smooth revenues. 3. 3 Celebrity EndorsementsKate Moss Collection by Top Shop has been another feather in the retailer's cap. This endorsement by the British super model would act to strengthen Top Shop's image as being first class in fashion clothing (Appendix 1). Furthermore, the hype and publicity that the mere fact of the supermodel introducing her own designer collection through Top Shop created would certainly reap long term benefits for the company. We intend to use same model for the brand awareness and project topshop‘plus' as a high end business.
Primarily, it would further Top Shop's liking amongst the other celebrities who might have otherwise preferred some other retail brand. But with Kate Moss endorsing it, there is greater likelihood of the brand gaining on its recognition in the general public as well as the celebrity masses. Also, such endorsements are essentially important after the management's concern for maintaining Top Shop's fashion-focused upscale image. 3. 4 Discount offersOne of the most surprising consumer promotions offered by Top Shop is the student discount (Appendix 2).
This proved to be a great success but with topshop ‘plus' because of Top Shop plus is an upscale fashion oriented global retail chain. However, such a discount can serve for Top Shop, two important purposes. Firstly, it would attract the young fashion oriented members of the target market who have lower purchasing power comparative to any of its other targeted customers. Along side this, promotions of this nature would allow the management to explore opportunities related to the younger segment of the market in the long run by giving it first hand knowledge of the segment's preferences.
Additionally, their preference for shopping at Top Shop today may continue to their later age thereby ensuring a smooth flow of revenues for the company. Secondly, and very importantly, such a discount offer is especially fruitful in times of recession. Where the sales of other upscale retail outlets may be going down due to high prices, keeping the young souls dressed in up-to-date trendy outfits obtainable at a special discounted price would prevent the sales going down beyond a certain acceptable level. 3. Membership cardsOne of the most distinguished promotions of this cutting edge fashion retailer is its exclusive membership for its customers. The membership allows access to its superior fashion advice service, ‘Style Advisor' whereby its most loyal customers can reach to thousands of Style Advisors round the globe while seeking a hassle free shopping experience (Appendix 3). The membership can be rightly thought of as a promotion to ensure customer loyalty by inculcating in them a sense of pride being associated with Top Shop.
Additionally, with preferred treatment in all the stores worldwide, such an initiative can ensure that the customers would help keeping the revenue flow smooth for this mighty fashion trend setter. 3. 7 Online PresenceIt is widely thought that a website primarily serves as a source of advertising and promotion for a brand. Additionally however, it also works effectively well in generating sales especially for an organization that has customers spread globally. Such a purpose is only served if the website allows the visitors to make order based purchases. Top Shop's online presence fits the aforementioned purposes.
It not only contains information on the upcoming fashion accessories but also some very useful tips and fashion advice. This can actually be an attraction for Top Shop's target audience who seek such services to be available such that they can access it any time and with the least time spending. Along with its tailored -size ordering available online, the company can ensure least possible hassle caused to the customers (Appendix 4). Furthermore, the website would continuously allow Top Shop to be an online sales point for the young students whose life styles make such buying rather convenient.
Although one cannot ignore the importance of its brick and mortar existence as well, the services available through its website may certainly add a lot of value to the business. It presence on Facebook and Twitter is another step forward in promoting itself far and wide. 3. 8 Sponsorships for the Rising Fashion TalentAs a gesture of its commitment to fashion and trendsetting, Top Shop has been closely associated with various initiatives for supporting and promoting young and aspiring fashion gurus. It provides title sponsorship for the Graduate Fashion Week.
Also, it does a lot of work in support of the London Fashion Week and for launching the careers of various young designers through the endowment of a special award. Through this award many well known names such as Hussain Chalayan, Clements Riberio and several others earned repute in the fashion industry. Such activities do two important things for Top Shop ‘plus' directly and indirectly. Firstly, it promotes the brand amongst the youth and gains their support. Secondly, such efforts ensure Top Shop‘plus' customer, of its commitment and support for fashion and so helps strengthen its position in the industry. . Understanding the Product Life Cycle Currently, Top Shop ‘plus' should grow rapidly in early stage of the PLC model whereby as an early adapter of the strategy of providing high rated fashion clothing at an affordable price, it has been working towards maintaining its product quality and adding more and more services to increase value for the customer. Additionally, with a high market demand and comparatively easier competition due to its current position, it is able to maintain low prices and yet enjoys profits and a positive brand image.
As it matures, it would certainly have to look into defending its market share since a lot of new entrants and existing players may catch up on its strategy. The future would therefore also require a very strong distribution network meshed with a extraordinary level of innovation in its products as well as its services. 5. SWOT AnalysisStrength:Topshop has been held in the UK market for over decades, it has created strong consumer loyalty over the time through unique taste, fashion and trends through the variety level on its product.
Customers are perceive Topshop as a premium brand, so the brand image is a key strength for the company. Extensive marketing strategy includes various dynamic advertisements which targeted male and female youth. The negotiation of better promotions through retailers strengthens demand and different sizes of product packaging suits consumer needs and buying patterns are considered to be some of its key marketing strengths. Being a high street market leader in the UK creates the feasibility of inorganic growth. Weakness:Topshop has not been able to compete against its competitors due to lack of marketing strategy in the times of growth.
The competitive advantage it once used to brush away the rivals was given away. M&S and others have taken the lead since. Opportunities:There has been a growth in the fashion industry even in midst of economic downturn. For a group like Arcadia, it gives an opportunity to expand its chain of businesses. With Topshop's existing brand name, it seems to be the logical and potentially good strategy. Threats:Threat of possible new entrant in the Britain market may increase for Topshop among people's attitude of American capitalism over Britain.
Some people could possibly opt to their own country brand upon perceived imitation could reflect on changing purchasing behaviour. The increasingly cheap but trendy and fashionable products manufactured under the name of retail giants such as Tesco, Sainsbury's and ASDA are a threat to substitution of Arcadia's Topshop. 6. Strategic AnalysisAn attempt by the management, and a very successful attempt too, the revamped image of this fashion brand was a step towards repositioning Top Shop and changing consumer perceptions about it.
After successfully doing so, Top Shop has been constantly at work to keep up its image as The Fashion Leader in the retail industry making shopping more of an entertaining experience for its customers through various other facilities, activities and services on its stores and online. Its association with fashion industry celebrities such as Kate Moss herself fortifies its position with reference to its brand values that blend up-to-date styles and affordability together. The shortest possible lead time industry wide, it further gains competitive advantage over so many other brands.
Additionally, when its sponsors fashion events and financially supports the careers of the upcoming talent, its gains the loyalty and support of the youth that would give it revenues on a long term basis. Its presence online as not only a promotional banner but as a proper sale point is an advance towards more success as that can certainly help it reaching to its target market in countries where it is not present at least as yet. This is also an effective way to reach out to the teenaged members of its target market whose lifestyles would rather allow them to make purchases online more conveniently.
For the matter of understanding, very simply put, the Ansoff's Matrix suggests that Top Shop is currently following a product-market growth strategy by focusing on both product and market development at the same time. However, the management must bear in mind that to maintain the current image of a cutting-edge affordable fashion provider, it must ensure a smooth supply chain system by which it would be able to carry on bringing in the latest fashion faster than any of its competitors. Also, now with its own designs out in the market, innovation and innovation only would be the key to its success.
Loyalty programs such as the membership cards and sponsorships are of course going to supplement all these efforts. 7. RecommendationsThe current popularity and success status of Top Shop does suggest that it has been upholding its image really well with its promotional activities. To ensure long term success however, it may take a few steps at this stage. For instance, now that its membership program is already in place, it may introduce a member-get-member program by which each member bringing in a new member with his reference is rewarded and acclaimed. This would help it in building upon its present clientele and lso on the loyalty level of the existing customers. As pointed out earlier as well, it is important that Top Shop pays attention to its supply chain. Its entry into self designed brands is a beginning but if it gains some control over its suppliers through backward integration, the risk may be greatly reduced. Otherwise, if the competitors somehow gain on this respect, it may cause serious damage to Top Shop's business. Therefore it is imperative that it pays attention to the factors that are a source of advantage for it now and are necessary for ensuring its long terms success. . ConclusionAs of now, Top Shop seems to be following a strong product-market growth strategy by focusing on increasing its worldwide presence alongside an increase in its products and services. Such a strategy would certainly prove fruitful when the competition paces up and a particular market for Top Shop reaches maturity. However, only if Top Shop focuses on continuous innovation and provision of maximum value to the customer, taking its position in the market would be rather difficult for the competing fashion retailers.
Furthermore, the various in-store services that it provides also act as an indirect way of diversification while being a part of the company's promotional strategy as well. References Baker, M. , 2003, The Marketing Book, 5th Edition, Butterworth-Heinemann, pp. 87-109 Kurtz, D. , 2009,Contemporary Marketing, 2009 Edition, USA, Neil Marquardt, pp. 363 Kotler, P. , Armstrong, G. , 2008 Principles of Marketing, 12th Edition,Pearson Education, pp. 338 Ferrel, O. , Hartline, M. , 2007, Marketing Strategy, 4th Edition, Thomson Higher Education pp. 282 David, F. 2007, Strategic Management,10th Edition, Pearson Education, pp. 196-210 Daniels, M. , May 4, 2009, Top Shop: Deconstructing the Retail Marketing Phenomenon Smith, A. , How Top Shop Changed Fashion, UK Available at http://www. time. com/time/magazine/article/0,9171,1625185,00. html [Accessed on Jan 19, 2010] Brand Republic, 2005, Super Brands Case Study: Top Shop Available at http://www. brandrepublic. com/news/474559/superbrands-case-studies-topshop/ [Accessed: Jan 23, 2010] Read more: http://www. americanessays. com/study-aids/free-essays/marketing/top-shop-marketing-plan. php#ixzz2A1VU1VWU
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