With only five years left to achieve Uniqlo founder Tadashi Yanai’s oft-stated goal of $50 billion in sales by 2020, the company is stepping things up.
This story first appeared in the November 19, 2014 issue of WWD. Subscribe Today.
Uniqlo has a lot of work to do, especially in the U.S., which has been charged with producing $10 billion in sales and 1,000 stores operating in the U.S. by 2020.
So far, Uniqlo has only penetrated five U.S. markets, so needs to expand aggressively. And it is: This fall alone, Uniqlo unveiled 18 new stores, which are in addition to the 21 units the retailer has opened since arriving on these shores.
“Next year, the issue is about generating revenue,” said Larry Meyer, chief executive officer of Uniqlo in the U.S. “We’ll be aiming to meet Mr. Yanai’s goals. We have to continue to grow at a very high rate.
“Where do I open stores in cities that will benefit bricks-and-mortar and online?” Meyer said. “With the stores, we’re always looking. Our strategy is convenience for customers and a showroom for tourists, introducing them to the brand and recognizing that e-commerce will grow as you add stores. It’s a respectable part of the business. It’s [e-commerce] in the midteens.”
Uniqlo is still intent on building big stores. Meyer said stores such as the Fifth Avenue flagship and SoHo unit in Manhattan, as well as the Union Square in San Francisco and Beverly Center in Los Angeles locations “represent the brand and do a great job.”
A flagship opening in Chicago will be 60,000 square feet, Meyer said. The company’s strategy for new markets is divide and conquer. Uniqlo has a pop-up shop in Faneuil Hall in Boston; it’s opening a permanent store in the city’s Back Bay and a permanent store at Faneuil Hall in 2015. It’s ringed Boston with units in Peabody, Chestnut Hill, Natick and Dedham, Mass. A store in downtown Philadelphia opened to complement units in Willow Grove, Pa., and Cherry Hill, N.J.
To achieve Yanai’s goal, Uniqlo must expand the appeal of its well-made basics to more customers.
LeAnn Nealz, Uniqlo’s new chief creative officer, has been bringing some more femininity to the brand, which is better known for its innovative fabrics such as Heattech and Airism than the design of its clothing. “It was somewhat unisex,” she admitted. “She has an American sense and a female sense that’s important to evolving the brand,” Meyer said.
Nealz still has more to do, but she’s been getting a little push-back from Japan. Uniqlo’s “Made for All” philosophy is at the heart of it. Rather than dictating styles or following trends, the retailer aims to provide clothing with universal design.
Nealz ran into a wall when she presented her collection to executives in Japan. “You should be able to come to Uniqlo and get a great dress,” she said. “I did 30 amazing dresses for fall. I went to Japan and out of that, I left with 10. It’s a very different culture. There’s a practicality, so sometimes it can be challenging. You’re not adding ruffles, but you’re working with fabric mills to develop new types of yarns.”
Nealz introduced more than 10 new dress styles, many with polka dots or stripes and styles from belted shirtdresses to long tunics, priced from $19.90 to $69. Ultra Light Down jackets come in 15 colors and prints in styles such as bombers and motos. There are gingham plaid rain coats and 100 percent French linen blouses in muted tones.
The company is entering its third season with Ines de la Fressange, who expanded her dress offerings and created an apron to wear over pants. “We’re always looking for designer collaborations,” Nealz said. “We want to be very selective. Collaborations add a lot to a store, especially a big store.
“Color is who we are,” Nealz said. “There’s an opportunity to build and expand on that. I want to do it in a bigger way, 50 different colors for down [jackets] or cashmere.”
Nealz integrated sportswear elements such as stretch and stay-dry fabrics into relaxed clothing, blurring the line between sportswear and casualwear. “We’ll expand on the sportswear piece,” she said. “We’ve added a lot more to the whole outerwear and the whole women’s side of the brand than where we’ve been in the past.”
Uniqlo began making changes to the brand about a year ago, when the company hired Nigo as creative director of its large UT T-shirt business, a position that didn’t exist before. Nigo worked on silhouettes, introducing more shapely women’s fits and “curated” the images from Disney to Merchant & Mills. Now consumers can design their own T-shirts at three locations, with choices such as animated characters, paints, stickers or a photo that can be downloaded.
The retailer is taking a renewed interest in denim with lighter-weight denim, indigo shades, selvage fabrics and for the first time, distressed, torn and ripped jeans. There are also new fits and styles, including tapered jeans that are 20 percent lighter in weight.
For men, Uniqlo showcased designer Michael Bastian’s updated polo shirts as well as the Dry Stretch Pant, developed with pro golfer Adam Scott, which are 100 percent synthetic but feel like cotton.
In the denim range, the retailer will be offering stretch selvage denim for the first time for men.
Other key men’s pieces include unlined cotton or linen blazers, sweatpants with back pockets, and a new V-neck model in the Airism line of T-shirts, which has been enhanced by the use of new yarns to increase the feel of coolness and enhance breathability.