The epidemic is still spreading around the world, and uncertainty about the future has made consumers in many parts of the world more cautious about buying fashion, especially clothing.
At the start of 2021, Japan’s media is paying attention to Uniqlo and its parent company, Fast Retailing.
Tadashi Yanai, the head of the company, conducted an interview to discuss the consumer environment, consumer psychology, digital transformation and other key words in 2021.
With the convergence of online and offline accelerating, the hope is that Uniqlo will offer products that will sell whether consumers are in stores or not, Yanai said.He emphasized that a truly excellent product must contain a kind of aesthetics.This applies not only to clothing, but also to all products.
“We offer a product that will sell whether the customer comes to the store or not.”
Since the outbreak, many brands in the fashion industry have faced reduced demand, factory shutters, shortened store hours and even suspended operations. Several fashion retailers have filed for bankruptcy protection, including the U.S. department store J.C. Penney, the U.S. fashion group J.Crew and Japanese apparel group Renown.
Uniqlo was no exception, closing 390 stores in China at the height of the outbreak.But Uniqlo’s emphasis on daily utility, high quality and low prices has avoided massive inventory cuts, and some of its spring clothing will be sold into the fall. Uniqlo has weathered the outbreak better than most global retailers.
In this interview, Mr Yanai stressed: “Physical retail is not going to die.Even if information such as a consumer’s address and phone number is available online, there is still no way to know what he or she really looks like.The customer’s reaction in the store, what they think about the product is important, which can only be asked on the spot.Internet companies want access to business information in physical stores, so many are acquiring retail businesses that operate physical stores.”
Yanai points to the example of the US retail giant Wal-Mart. “One of the keys to Wal-Mart’s revival is to connect online and offline, that is, to realize that the physical is as important as the online.For consumers, it’s best to use both, physical or virtual.Consumers today see no difference between shopping in stores and online.In the future, consumers may browse clothing and communicate with shop assistants via the Internet.Hopefully, we can provide a product that will sell whether the customer is in the store or not.”
“You have to have an aesthetic and expertise in clothing to run a physical clothing retail business.People who can quickly understand trends and match them are indispensable.Without professional knowledge, it will be reduced to ordinary consumables.A truly excellent product must contain a kind of aesthetics.This applies not only to clothing, but also to all products.Apple’s phones sell well around the world because of their beauty, “says Yanai.
From Uniqlo’s series of moves in 2020, we can see Yanai’s insistence on the physical retail industry.In the first half of 2020, Uniqlo opened three “stunning” heavyweight stores in Yokohama, Tokyo’s Ginza and Harajuku, with a combined retail area of about 11,000 square meters.
As of December 31, 2020, Uniqlo had 2,306 stores worldwide, and the Group hopes to reach a total of 2,371 stores worldwide in the fiscal year ending August 2021.”The ultimate shape of stores in the future is likely to be that customers will be able to connect with stores digitally. For example, customers will be able to see the store and sales staff at home through a tablet, and they will be able to confirm the appearance of products and product information through a mobile device without ever going to the store,” Yanai said.
“Make the best clothes for the home so that people can work and stay at home.”
The impact on incomes has made consumers more frugal, says Mr Yanai: “As consumers become more frugal, the importance of brands and the quality of products becomes more important.Consumers will choose quality and reliable brands.At the same time, the days of formal wear have gone and the days of everyday wear have officially arrived, driven by the growth of casual wear and telecommuting.We want to make the best everyday clothes, and people will choose clothes that are good for work and home, that are durable and can be used in many different ways.Clothes that you wear a year and throw away are no longer needed.”
The latest collection, in collaboration with German designer Jil Sander, also emphasises the “everyday wear” scene.In the new +J series, JIL SANDE Outlines the flowing three-dimensional engineering profile with minimalist lines. It uses high-performance fabrics, high-grade cashmere, worSTED merino and other high-quality fabrics, and skillfully handles the details such as cushions, pockets, zippers, and color contrast lining, creating classic pieces for people to wear in daily life with minimalist design.
“Uniqlo’s goal is to offer ‘the best everyday wear’ for all ages and genders.In 2020, the +J series, which was released again after many years, received good market feedback, and many people said that the completion degree of the clothing was very high.In this process, the designers themselves have made efforts, and Uniqlo’s delivery, transportation and production links are also essential.The +J series is a typical example of how we collect and collate information, then produce and sell, and interact with customers to form a closed loop, “says Yanai.
According to Yanai, Uniqlo will collect information independently, design and produce products, deliver them to stores or sell them online, and then produce products based on customer information, forming a closed loop.
In the summer of 2020, “due to a lot of consumer requests,” Uniqlo used Airism, a breathable, sweat-weting lingerie fabric, to make face masks that are better suited to summer temperatures.Since then, the company has also launched a line of “slacks” specifically designed to meet the needs of the home.
“I feel that the boundaries between all industries — retail, manufacturing, logistics — are disappearing, and all industries are becoming information services, with routine operations left to AI and robots,” Yanai laments. “But the key part still needs people!”
More than 20 years ago, Yanai tried to change the way vegetables are sold. “It was a failure.Just start from transportation, cannot fundamentally change agriculture, must go deep into the production link.So I knew my limits, and then I started to specialize in clothing.Work with Chinese factory operators to grow together.At the beginning, it is often a headache to do the opposite side of the fabric and the position of the pocket.With the support of our partners, we have implemented Japanese technology, factory management methods and quality products.”
‘China and Southeast Asia will lead the recovery’
“China and Southeast Asia will lead the recovery and drive consumer spending, but the contagion varies from country to country.For example, consumer spending in the worst-affected Asian countries, such as Malaysia, Indonesia and the Philippines, has stagnated, but consumption is recovering in places like Taiwan and Vietnam, where it has been brought under control.Unless the number of infections stops growing, it will be difficult for consumption to recover.”
In countries where the epidemic has not been brought under control, the number of people losing their jobs, being on leave and having to stay in isolation continues to rise. “People are anxious about the future, so we need to start with their anxieties,” Yanai said.Consumers are much more price-sensitive today than they were after the financial crisis in 2011.We can’t raise prices in this situation. If we raise prices on ordinary goods, we won’t be able to sell at all.”
“In Japan, the third wave of the epidemic has had a huge impact on sales, especially on weekends, when people avoid going out during the holidays.But people still shop near where they live.Uniqlo’s stores in the city centres of big cities are not doing well, but business is booming in the suburbs, “adds Mr Yanai.
“In 2021 and beyond, Asia is expected to be the center of the world.Formal wear originated in Europe, but emerging market Asia, on the other hand, is, for a variety of reasons, comfortable to wear casual clothes every day.We want to be a global brand and the first best clothing brand to start in Asia.”