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Situation Analysis Of Abercrombie And Fitch Uk

A&F has over 1059 stores located worldwide. Consequently, the latter company is in a position to understand the intricacies involved in dealing with the clothing industry. (Wilson & Gilligan, 2005) Since the UK market is relatively different from the US one, the company needs to have highly flexible strategies which they have already perfected through their operations in other parts of the world. It should also be noted that certain winning strategies in other locations can be borrowed and introduced into the UK market.

Since it stores are chain stores, then their designs and layouts are replicated in different geographical locations. For instance, the A&F store has a lingering scent of their signature fragrance and loud electronic music. Its interiors designs of low dim lights and white moulding louvers are also important in selling A&F as a unique company. Additionally, marketing campaigns carried out by the latter company have attracted consumer attention because of their sexual appeal. In fact, most marketing campaigns have received a lot of acknowledgement from a number of parties. While this may be seen as a negative in certain respectives (too much deviation from the brand), one can assert that their marketing methods are effective since they are able to reach intended audiences. Consequently, these adverting capabilities have been transferred to the United Kingdom and have recorded positive outcomes so far. (Hollensen, 2003)

The company also boasts of sound financial performances within the UK stock market. As of 2008, the following were the key financial aspects linked to the company;

Sales in 2008- 1884.3 million pounds

Sales growth 2008 – 13 %

Net income – 239 million pounds

Net income growth – 12.7 %

Number of employees worldwide – 99, 000

Employee growth – 14.6%

As it can be seen from the latter results, the company is doing rather well for itself and it therefore stands to grow and expand its operations if it continues in the same manner throughout the future.

Evaluation of primary and support activities and how they add value to them

A&F takes pride in its merchandise and brand protection efforts. The company is known for its casual luxury product offerings in which it uses fine materials designed to be body conscious in order to meet the needs of the consumer. Additionally, the company also offers a number of fragrances for both females and males. Examples here include Classic, Wakely, Perfume 8 and many more. The company has signature fragrances and it also has high end fragrances that are designed to capture the essence of this company. the sale of these brands and its fragrances can therefore be seen as one of the methods used to make the brand easily recognisable.(A&F, 2009)

The core activities in A&F are the sale of the products. However, there are a number of support activities that have enabled the company survive thus far. First of all, the company established an A& F brand protection program. This is necessary after the realisation that a number of it goods were being counterfeited since its brand was growing at a very high rate. The Company's main aim behind establishing this brand was so as to ascertain that consumers could get their respective products easily without having to deal with counterfeits.

Besides the latter matter, A&F has subsidiaries that are still managed by the latter company. These brands include Gilly Hicks in which the company offers underwear and lingerie for women over the age of eighteen. Additionally, there is the Hollister Co. Brand in which the company offers product for teenagers between the ages of fourteen and eighteen. Lastly, the company has RUEHL no. 925 in which the women can access leather bags and purse. The age targeted by this product is twenty two to thirty five.

The company has also dedicated a lot of its resources towards humanitarian and societal campaigns. First of all, the company usually sponsors the Inferno Elite racing team that dwells n cycling and is also a non profit venture. It offers scholarship to students in high school and also engages in other related ideas.

SWOT to TOWS

Strengths

One of the major strengths for this company is its experience in the US clothing industry i.e. for one hundred years. The latter company has been able to compete favourably with UK retailers because like the US market, UK consumers have a deep respect for quality and this company is able to offer them that. They have unique garment combinations and their fragrances also possess this same quality. (Aaker, 2005)  They are therefore in a position to handle some of the challenges facing this respective industry.

Besides the latter matter, A&F is succeeding within the UK since there is tendency towards dressing down in the recent years. Most offices in the IT sector allow casual wear while all other offices usually have a causal Friday. Consequently, A&F which specialises in offering luxurious casual wear has higher chances of succeeding in this market than those companies offering formal clothes as their major product.

Weaknesses

One of the issues that has generated a lot of debate about Abercrombie and Fitch is the fact that the company's marketing strategies do not portray its core idea i.e. that of comfort and a causal lifestyle. When one examines their adverts, one is likely to find half dressed men and women. The company has focused too much on portraying this "sensual" image and has thus deviated from its core idea which was to offer people causal clothes for their every day needs. The company has failed to communicate this message even in their online website as readers are bombarded by scantily dressed models that do not signify the comfortable look.

Opportunities

One major opportunity for this company lies in the fact that men are now more interested n fashion than they were a decade ago. This has been made possible through new male magazines and advertisements of men's apparel. Therefore, A&F has a greater chance of succeeding in the UK market if they offer men products well suited to them. (Gilligan and Wilson, 2003)

Online shopping is fast becoming a force to reckon with in the retail industry. Abercrombie and Fitch may have began embracing this aspect but they still need to improve on their overall company image when dealing with this matter. First of all, the latter company needs to work on its website. It should include some vital information that may be necessary to inform consumers about its products. For instance, it could tell them about its vision and mission. It should also give details about its stores and their history. Additionally, the huge photographic advertisements of half nude models need to take up less space. The company needs to show more of its clothes than its models. Also, it could introduce an interface in which consumers can chat with company representatives across the internet.

Threats

The highly competitive nature of the UK clothing industry could prove to be a challenge to this company. A number of mid retailers have closed in the past few years and this may apply to A&F if no further improvements are made.

TOWS matrix

Organisational

Strengths

Organisational weaknesses

Strategic options

Environmental opportunities

(and risks)

SO: The company needs to embrace its online sales more aggressively by examining how other markets in other non – UK markets reacted to them

WO: the company needs to focus on its core idea so as to overcome the issue of diversion from the core brand

Environmental threats

ST: Despite UK's competitive retail industry, the company can use in branding ideas that have worked in other parts of the world to stay above the competition

WT: A&F needs to market its products in such a manner that it brings out their uniqueness. This will eliminate the threat of excessive competition from established names and will also deal with its poor advertising strategies

References

Abercrombie & Fitch (2009): Home Page, retrieved from http://www.abercrombie.com/ accessed on 4th Feb 2009

Aaker (2005) Strategic Marketing Management, 7 th edition, Wiley.

Brennan, Baines and Garneau (2003) Contemporary Strategic Marketing, Palgrave.

Dibb, Simkin, Pride and Ferrell (2006) Marketing Concepts and Strategies,

Houghton and Mifflin.

Doyle and Stern (2006) Marketing Management and Strategy, 4 th edition, Prentice

Hall.

Drummond & Ensor (2001) Strategic Marketing, Planning & Control, 2nd edition,

ButterworthHeinemann.

Gilligan and Wilson (2003) Strategic Marketing Planning, ButterworthHeinemann.

Hollensen (2003) Marketing Management, A Relationship Approach, Prentice Hall.

McDonald, (2006) Marketing Plans, 5th edition, CIM ButterworthHeinemann.

Wilson & Gilligan (2005) Strategic Marketing Management, 3rd edition,

ButterworthHeinemann