Successful Apparel Brands Stress Clarity and Purpose

Consumers expect seamless experience

Consumers spent more freely on apparel, both in store and online.With a 21 percent increase in brand value, on top of a 13 percent rise a year ago, the apparel category continued its steady recovery since a 9 percent decline in 2009, during the depths of the financial crisis.

Shoppers sought value: either good quality at a fair price or exceptional quality that earned its premium. Brands in the middle got squeezed. Consistent with this trend, fast fashion continued to thrive while craftsmanship gained growing respect.

An attitude that The Futures Company, a strategic insight consultancy, calls “Considered Consumption” continued Up 21% to constrain spending. But consumers abandoned that post-recession mentality when items seemed unique and worth the price.

Recognizing the importance of brand experience in refocusing the purchasing decision away from price alone, brands sought to tell compelling and unified stories in store and online. In addition, these related trends emerged:


Brands with physical stores leveraged that presence to offer location convenience and showcase the brand.


Brands attempted to personalize products and services for individual customers rather than market segments.

Margin improvement

The more upscale brands, especially, attempted to both control costs and push up prices.

Fast fashion set the pace

Illustrating the continuing appeal of fast fashion, Zara increased 60 percent in brand value to become the most valuable brand in the BrandZ™ apparel ranking. Zara enjoyed strong like-for-like sales even in economically troubled Europe, and it continued its China expansion. Profit increased 12 percent year-on-year.

The Spanish-owned brand benefited from its presence in more than 80 countries and its rapid inventory turnover, which added urgency to the purchase decision because shoppers understood that merchandise available today may be gone tomorrow.

Zara opened a flagship store on New York’s Fifth Avenue last year, a block away from H&M, the Swedish-based competitor, and adjacent to its rival Uniqlo, the Japanese apparel brand.

Telling a brand story

To differentiate, Uniqlo explained how unique and innovative technology enables the brand to produce cold weather outerwear that’s warm, and warm weather underwear that’s cool - as well as affordable and stylishly designed. Color variety was a major part of the brand’s excitement and in-store experience.

Uniqlo, which focuses on more utilitarian, basic clothing, rose 25 percent in brand value. Ads featuring celebrity models reinforced Uniqlo’s proposition that customers can dress on trend without spending over budget.

The brand expanded aggressively with international net sales growing 63 percent, while sales in home market Japan were up only 3 percent. The 65 new stores in China accounted for more than 50 percent of the international new store openings. Uniqlo operates around 300 stores in 13 countries.

The more established H&M, founded in 1947, operates about 2,800 stores in 48 countries. The sluggish economy in some of those countries resulted in same-store sales declines. The company planned to grow its US presence with more stores and online shopping. In a much-viewed example of combining high fashion with low price, actress Helen Hunt wore an H&M dress to the 2013 Oscars.

Newcomer faces competition

lululemon appears on the list of most valuable apparel brands for the first time. The Canada-based specialist sportswear brand operates over 200 stores in North America and Australia. The brand transformed functional yoga and workout apparel into the uniform of health-conscious, fashionable women. Like-for-like sales increased 16 percent in 2012.

lululemon protects the equity of its brand by rarely discounting its merchandise, even excess inventory. Instead, lululemon each year selects a city and stages an enormous sale in a major venue, such as a sports stadium. These much anticipated special events draw considerable publicity, attendance and sales.

Early in 2013, lululemon recalled a key item because of a manufacturing defect.

The uncharacteristic stumble opened a potential opportunity for more established competitors, including Nike. Like the fast fashion brands, Nike focused on growing sales in China, where it has worked to redefine sports around self-expression and fun rather than the traditional Chinese approach, which sees sports as communal and obligatory.

Seeking a higher purpose

As part of its strategic effort to grow the market, Nike has formed runners groups and invested in the construction of sports facilities. For Nike, the connection between athletics and health is fundamental. It introduces innovative technology, such as the Nike+ FuelBand, to advance this agenda. The wristband converts daily physical activity into a score that enables the wearer to track personal progress and compete with social friends.

Like Nike, apparel brands of all sizes connected with a higher purpose relevant to their brand essence. Patagonia, a purveyor of performance clothing, emphasized social responsibility. In an initiative called One for One, Patagonia partnered with TOMS Shoes, a company which matches every pair of shoes purchased, with a new pair of shoes for a child in need.

Product provenance was important but sensitive. Ralph Lauren gained tremendous brand exposure for designing the uniforms worn by US athletes at the summer Olympics in London. The brand’s decision to source the uniforms in China received criticism in the US, however. Concern about ethical sourcing and labor standards again received public scrutiny following a fatal fire at a Bangladesh apparel factory.

Insights BrandZ BigData™

Brands get creative in tough economy

Alongside luxury, apparel is rated as the most “sexy” category in the BrandZ™ research. Since the recession, many of the top apparel brands are also considered strongly “creative.” During the same period, brand promise has risen on average and price perceptions have become more favorable, reflecting the pressures of survival in a tough retailing climate.

Action Points

1 . Be personal

Apparel is not one size fits all. Customers want to feel that the service is bespoke even if the merchandise is mass. As much as possible, get to know customers individually through the data they supply or one-on-one in the stores.

2. Be genuine

Be whatever the brand stands for, but stand for something. The list of the most valuable brands includes some brands that emphasize social responsibility and others that extol style at a good price. What they share in common is this: they have a differentiated brand proposition and they deliver it.

3. Be consistent

Customers will shop the brand wherever it appears. All products, presentation, service and attitude need to feel the same across all customer touch points.

4. Engage with bloggers

Become familiar with the relevant bloggers. Who reads their posts? A large following is good but size isn’t everything. A well-informed blogger reaching a key audience can also be helpful. Meet with the bloggers and show them new products as you might in a press briefing.

Apparel Up 21%

The apparel category is comprised of mass-market men’s and women’s fashion and sportswear brands, but excludes brands viewed by consumers as luxury.

BrandZ Top 100 2013

BrandZ Global 2013 Report Top 100 Report

Top 100 Chart

2013 BrandZ Top 100 Infographic

BrandZ 2013 Infographic

Methodology and valuation by Kantar Millward Brown

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