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GfK Fashion Report July 2012
Incorporating data from The Sunday Times
Fashion Study and other GfK research




Helen Roberts / Lisa Luckhurst
GfK NOP, Consumer and Retail
© GfK 2012 | GfK Fashion Report | July 2012   1
Contents
1.     Background and objectives of the Sunday Times Research    3
2.     Consumer Mindsets – from other GfK data                   5
3.     Shopping for clothes                                     15
4.     How the 7 brands performed                               18
5.     Quality, Price & Value                                   22
6.     Design                                                   26
7.     Overall performance                                      29
8.     Appendix                                                 35
       •     GfK Consumer & Retail                              36

       •     The Sunday Times Fashion Study                     40

       •     GfK Roper Consulting                               43

       •     GfK Savvy Shopper                                  47

       •     GfK Women’s Clothing Study                         48

9.     Contacts                                                 54


© GfK 2012 | GfK Fashion Report | July 2012                          2
Background and Objectives


                                                             What did we
                        Why did we                           want to find
                          do it?                                out?
                                              What else do
                                                                            How was it
                                               we know?
                                                                              done?




© GfK 2012 | GfK Fashion Report | July 2012                                              3
Background to the project
The research was conducted for the Sunday Times who were keen to understand current
consumer perceptions of quality, price and value for clothes from a number of leading
retailers
Brands evaluated
7 UK fashion retailers were included in the test:
Products tested
5 items were tested from each retailer: chino’s, cargo pants, shirt, blouse and a polo shirt
Survey method
The research comprised 2 simultaneous hall tests, with a total of 82 respondents assessing
35 products. Further details of the method are contained in the appendix


Other GfK data sources
This report also draws on three other GfK data sources to add context and depth to the
analysis:
   1. The Consumer Confidence Barometer, conducted by GfK for the European
       Commission
   2. Roper Reports Worldwide (Mood of World Factbook)
   3. GfK Savvy Shopper
   4. GfK Women’s Clothing Study

© GfK 2012 | GfK Fashion Report | July 2012                                                    4
Consumer Mindsets


                           How’s                               Are we cutting
                          Consumer                                 back?
                         Confidence?
                                               What are we                       How are we
                                              worried about?                    saving money?




© GfK 2012 | GfK Fashion Report | July 2012                                                     5
The mood of the nation is short on economic optimism!

         We are worried
           about the
           economic
           situation                          It’s affecting how
                                                    we think
                                                                   It’s impacting
                                                                    what we do
         Confidence is
        almost as low as
           during the
                                               More worried
        banking crisis of
                                              about how we’ll
             2008
                                               maintain our
                                                 lifestyle          Cutting back    We are increasingly
                                                                   more than ever   targeting clothing as
                                                                                     an area to cut back
                                                                                          spending


© GfK 2012 | GfK Fashion Report | July 2012                                                                 6
Consumers view of the economic situation has stabilised
(at a low level) since the end of 2011
 General Economic situation of the Country May 2012

                                                                                                                                            Better




                                                                                            2008
                                                                                            Banking
                                                                                            crisis

     The Consumer Confidence Barometer
     Research carried out by GfK on behalf of the
     European Commission



Q3 How do you think the general economic situation in this country has changed over the last 12 months?                                     Worse
                  Got a lot better = 1 / Got a little better = 0.5 / Stayed the same = 0 / Got a little worse -0.5 / Got a lot worse = -1

Q4 How do you expect the general economic situation in this country to develop over the next 12 months?
                 Get a lot better = 1 / Get a little better = 0.5 / Stay the same = 0 / Get a little worse -0.5 / Get a lot worse = -1


© GfK 2012 | GfK Fashion Report | July 2012                                                                                                          7
The economic situation, particularly the Euro crisis
remains a concern and confidence in those in
charge continues to fall
                                                                             Agree Completely or
                                                                             Somewhat that…%

                                                                                                                 71    71
                                                                               68    68

                                                                  57    56


                                                                                                                                 Jun-10
                                                                                                                                 Late 2010
                                  31                                                                                             Late 2011
                                         25
                                                                                                                                 May-12

                                              15   16


                                                                                                 n.a.

                              The economy is in good hands   Economic situation will get worse   Euro crisis will have a major
                                                                  before it gets better            impact on UK recovery


 Q18. Now, thinking about the economic outlook for the next 12 months, how much do you agree with the following statements?


 Source: GfK Savvy Shopper
© GfK 2012 | GfK Fashion Report | July 2012                                                                                                  8
Consumers remain negative about their own financial
  situation, though some optimism that next year will be
  better than last
 Personal Financial Situation of Household – May 2012
                                                                                          Last 12 Months                                                                                           Next 12 Months                                                                                                                     Better
                                                                                                                                                                                                                                                                                                                                                              17
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     Research carried out by GfK on behalf of the                                                                                                                                                                                                                                                                                                             -17
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Q2 How do you expect the financial position of your household to change over the next 12 months?
                 Get a lot better = 1 / Get a little better = 0.5 / Stay the same = 0 / Get a little worse -0.5 / Get a lot worse = -1                                                                                                                                                                                                    Worse
Q1 How has the financial situation of your household changed over the last 12 months?
                   Got a lot better = 1 / Got a little better = 0.5 / Stayed the same = 0 / Got a little worse -0.5 / Got a lot worse = -1
  © GfK 2012 | GfK Fashion Report | July 2012                                                                                                                                                                                                                                                                                                                       9
Spending money and lifestyle are of more concern
  than job loss or debt


                                          63                                                Agree Completely or
                                     59                                                     Somewhat that…%
                                                                       51
                                                       43         45
                                                             40                                                                             Jun-10
                                                                                                                                            Late 2010
                                                                                                                                            Late 2011
                                                                                    25 24 23 23
                                                                                                                                            May-12
                                                                                                                  18 20 17 18




                      Current downturn will have Concerned about how I will       I believe I will have more   I am concerned I may lose
                      direct effect on money I can maintain lifestyle in coming    debt this time next year    my job in next 6-12 months
                                  spend                        year


Q18. Now, thinking about the economic outlook for the next 12 months, how much do you agree with the following statements?



  © GfK 2012 | GfK Fashion Report | July 2012                                                                                                           10
Consumers continue to feel unwilling to commit to
 major purchases
 Climate for major purchases – is now the right time to buy?
                                                                                                                                                                                                                                                                                                                                      Right time
                                                                                                 Major purchases                                                               Annual moving average
                                                                                                                                                                                                                                                                                                                                                              32
                                                                                                                                                                                                                                                                                                                                                              30
                                                                                                                                                                                                                                                                                                                                                              28
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Q8 In view of the general economic situation, do you think now is the right time for people to make major purchases such as furniture or electrical goods?                                                                                                                                                                            Wrong time
                    Yes, now is the right time = 1 / It is neither the right time nor the wrong time = 0 / No, it is the wrong time = -1


 © GfK 2012 | GfK Fashion Report | July 2012                                                                                                                                                                                                                                                                                                                    11
The trend towards cutting back on clothing spend has
 grown more than other categories, suggesting
 increasing frugal behaviour in the category
                                                                                                                                                                                            Euros/
  GfK Savvy Shopper                                                     Purchase intent – Next 12 months                                                                                    Olympics
                                                                                                                                                                                            effect?

 % “I will spend less on… minus % ”I will spend more on…”
                                                                                                                                                                                                      49
                                                                                          May-12              Late 2011              Late 2010                              45      45
                                                                                                                                                                                                              46
                                                                                                                                                              43     43                      43
                                                                                                                                                      41
                                                                                                                                          40
                                                                                                                                39
                                                                 37                                      37     37                             37
                                                                                                                        36
                                                                                                 33
                                                                          32      32
                                                   31     31                             31
                                         29
                                  28
                   26
                           25
           24


    18




   Entertaining at home         Saving             Buying new clothes     Donating to charity       Planning more            Eating out        Going out drinking   Buying new furniture   Buying a large electrical
                                                                                                holidays/short breaks                                                                        item such as a TV

  = positive significant difference at 95% confidence level
  = negative significant difference at 95% confidence level
Q16. Which of these do you think you will be spending more or less on over the next 12 months?
  Source: GfK Savvy Shopper
 © GfK 2012 | GfK Fashion Report | July 2012                                                                                                                                                                           12
Clothing and Shoes are 3rd in a list of 26 areas of
expenditure that people in the UK have cut back on
                       Roper Reports Worldwide 2011 and 2012 | Mixed-mode trend, core 25 countries
                                     % who have cut back on things in past 12 months




Source: GfK Roper Reports Worldwide
© GfK 2012 | GfK Fashion Report | July 2012                                                          13
Cutting back involves the use of multiple money
saving techniques and shopping carefully for
essentials including clothes is the 2nd most widely
taken action
                              Roper Reports Worldwide 2012 (mixed-mode trend, core 25 countries),
                                      % who have done activity in the past 12 months




 Source: GfK Roper Reports Worldwide
© GfK 2012 | GfK Fashion Report | July 2012                                                         14
Shopping for clothes


                                                           How do we
                            What’s
                                                         choose what to
                          important?
                                                             buy?                  Value?
 Style?                                       Quality?
                                                                          Price?




© GfK 2012 | GfK Fashion Report | July 2012                                         15
We are conservative when it comes to buying clothes!

            We are not driven purely by the latest trend
                      when buying clothes




             Most are far more concerned about quality
              and value (and getting a bargain). The
              Savvy Shopper mindset is strong when
                        shopping for clothes
                                                                                                    The Shopping
                                                                              Range & Style         Experience
                                                           My Kind of Store


           The decision on where to shop for clothes is
              shaped by this core Savvy mindset and
             then influenced by the clothing range on
                                                                     Ethics
                  offer and the retail experience                                                        My Kind of
                                                                                 Value for Money,       Clothes



© GfK 2012 | GfK Fashion Report | July 2012
                                                              Source: GfK Green Clothing study                        16
Fashion shopping behaviour
It’s clear that getting a bargain is important to respondents but aside from this, buying
quality items and brand loyalty are important. Perhaps unsurprisingly, given the
typical ‘Middle England’ profile
of the sample, having the latest fashion is lower in their list of priorities when buying
clothing



                 I like to seek out a bargain                                               77%

         I always buy high quality clothes                                     44%

         I like to stick to the same brands                                 41%

     The brand of clothes I wear matters                          30%

      I am happy to pay a price premium
                                                            20%
         just to have ‘in-fashion’ items

     I always try to buy the latest fashion           15%

         Fashion is more important to me
                   than quality
                                                10%



Source: the Sunday Times Fashion Study
© GfK 2012 | GfK Fashion Report | July 2012                                                       17
How the 7 brands performed


                                                       What are their
                           Who’s the
                                                        strengths?
                            best?
                                              Who’s
                                              worst?                    How can they
                                                                         improve?




© GfK 2012 | GfK Fashion Report | July 2012                                            18
Key findings
                                                  Positive takeouts                                    Negative takeouts

                                 • Rated best products overall in blind test,           • Ranked 5th out of 7 in terms of good value
                                   particularly on cut of fabric, design and quality
                                   of buttons/zips
                                 • Ranked top in terms of preference and likelihood
                                   to purchase (although currently used for
                                   everyday purchases by just 17% of sample)

                                 • Rated best value for money                           • Quality of buttons/zips was relatively low compared with
                                 • Placed 2nd overall in blind test, with quality of      other retailers
                                   fabric and stitching
                                 • Blouse design was particularly popular


                                 • Very close overall ranking to Primark,               • Poor performance on value for money, ranking 6th out of 7
                                   performing particularly well in terms of quality
                                   and design of it’s Polo Shirt


                                 • Middle ranking overall but with 2nd highest rating   • Very poor performance in terms of value for money,
                                   on quality of Cargo Pants and Polo Shirt             • Perception of quality and design of Cotton Shirt was very
                                                                                          poor in blind test
                                                                                        • Lowest ranked in terms of likelihood to purchase and
Source: The Sunday Times Fashion Study
                                                                                          preference and not currently used for everyday purchases by
© GfK 2012 | GfK Fashion Report | July 2012
                                                                                          any of the sample                                         19
Key findings
                                              Positive takeouts                                        Negative takeouts


                                • Ranks 3rd on good value for money                       • Poorest performance in terms of overall design in blind test




                                                                                          • Ranked 6th out of 7 overall in blind test
                                • Used for everyday purchases by 1 in 4 respondents       • 40% of respondents expected products to be low priced
                                • 2nd highest ranking in terms of preference and            based on evaluation of quality and design
                                  likelihood to purchase
                                • Blouse quality was considered to be particularly high




                                • Ranks 2nd on good value for money                       • Poorest performance overall in blind test
                                                                                          • Products least likely to be considered ‘high priced’ based
                                                                                            on evaluation of quality and design (8%)
                                                                                          • Ranked 6th out of 7 on brand preference and likelihood to
                                                                                            purchase and


Source: The Sunday Times Fashion Study
© GfK 2012 | GfK Fashion Report | July 2012                                                                                                        20
Brand preference and likelihood to purchase
Respondents were given a list of the 7 brands and were asked to rank in order of
preference and likelihood to purchase. Next , H&M and Marks & Spencer are the
clear favourites, with Boden receiving the lowest rating for both
                                                     % typically buying everyday clothes from each retailer

                    26%                    23%                   23%                     5%                    2%                       -   17%


                                                  Ranking in order of preference and likelihood to purchase
      7

      6
                                                                                                                                                   Likely to
      5                                                                                                                                            buy
                                                                                                                                                   Preferred
      4

      3

      2

      1
                    H&M                 Primark                  M&S            TU (Sainsbury) F+F (Tesco)                          Boden   Next
Q1. Can you tell me where you typically buy everyday clothes for yourself and/or your family?
Q10. Here is a list of clothing brands. Please rank them in order of a)Preference b)How likely you are to buy? Base: All respondents (82)
© GfK 2012 | GfK Fashion Report | July 2012                                                                                                                    21
Quality, Price & Value


                                                            Who is the best
                         Who has the                           value?
                         best quality?
                                              Who has the
                                              best price?




© GfK 2012 | GfK Fashion Report | July 2012                                   22
Product quality – T2B ranking summary
Taking all product categories into consideration, Next and Marks & Spencer rated
highest in terms of quality. Boden falls in the middle with very similar ratings for all
quality questions – and, somewhat surprisingly, below Primark.



                   Next


 Marks & Spencer


               Primark

                                                                                                                                                                                  Buttons/zips
                 Boden                                                                                                                                                            Stitching
                                                                                                                                                                                  Fabric
     Tu (Sainsbury)


                   H&M


        F+F (Tesco)

                          0%           20%           40%           60%          80%          100%        0%            20%           40%           60%           80%          100%
Q3. Please tell me, for each of the clothing items on the table, what you think of the quality of the fabric using a scale of 1-5 where 5 = excellent and 1 = very poor;? Q4. And what you think
of the quality of the stitching/workmanship?; Q7. What you think of the quality of buttons, zips fastenings etc.? Base: All respondents (82)
© GfK 2012 | GfK Fashion Report | July 2012                                                                                                                                                   23
Quality – %T2B summary by product category
Looking at the quality at product level, Boden’s cargo pants and polo shirts are rated highly
compared with the majority of other brands but their cotton shirt, which is actually their most
expensive item, is considered poorer quality than any of the other brands. Respondents had
a similarly poor opinion of their chinos and blouse. H&M, generally a poor performer across
the board, received a very positive rating of the blouse evaluated


                                                  Cargo pants                   Chinos                      Blouse                   Polo shirt                Cotton shirt
                                                      (50)                       (48)                        (48)                       (48)                       (48)
                  Next                                  54%                       49%                         35%                        49%                         50%

                  Marks & Spencer                       35%                       23%                         27%                        58%                         42%

                  Primark                               41%                       44%                         37%                        42%                         42%

                  Boden                                 50%                       29%                         25%                        56%                         28%

                  TU (Sainsburys)                       24%                       42%                         28%                        24%                         45%

                  H&M                                   35%                       32%                         43%                        29%                         36%

                  F+F (Tesco)                           18%                       29%                         23%                        28%                         37%


Q3. Please tell me, for each of the clothing items on the table, what you think of the quality of the fabric using a scale of 1-5 where 5 = excellent and 1 = very poor;? Q4. And what you think
of the quality of the stitching/workmanship?; Q7. What you think of the quality of buttons, zips fastenings etc.? Base: All evaluating
© GfK 2012 | GfK Fashion Report | July 2012                                                                                                                                                  24
Price (average across all categories)
Of all products evaluated, respondents were most split by Boden items, with c.one third each
saying the price should be low, medium and high. Next clothing was considered the most
likely to be expensive and Tesco items the cheapest. Based on the actual price of each item,
Boden’s were rated by far the least value for money and Primark the best.
                                          Estimated price ranking (de-branded evaluation)                                Good value for money (de-branded evaluation)
                                                                                                                                                    %T2B

                       Next           21%                         44%                              34%                                               54%

                   Primark                30%                               49%                           21%                                        88%

                      M&S                27%                             47%                            26%                                         41%

                    Boden                     38%                          32%                        30%                                           20%

        TU (Sainsbury)                         40%                               39%                      21%                                       65%

                      H&M                      40%                                   51%                        12%                                 61%

            F+F (Tesco)                          45%                                    46%                     8%                                   71%
                                            Low                        Medium                    High
Q8. Thinking now about cost, please rank each item according to whether you think the price would be ‘low’, ‘medium’ or ‘high’. Q9. Given the actual price, to what extent do you agree that
the item is good value? Base: All respondents (82)

© GfK 2012 | GfK Fashion Report | July 2012                                                                                                                                               25
Design


                                              Does it vary by
                         Who has the
                                                product?
                         best design?




© GfK 2012 | GfK Fashion Report | July 2012                     26
Product design – T2B ranking summary
The design of the items from Next was the most popular amongst the selection reviewed and
Boden is mid-range as was the case for it’s quality (although, interestingly it is less popular
on both aspects amongst 35-64 year old respondents). Primark performs favourably again,
achieving second place and Tesco clothing once again is least popular.


                      Next


                  Primark


     Marks & Spencer

                                                                                                                                                         Cut of fabric
                   Boden
                                                                                                                                                         Design


                      H&M


        Tu (Sainsbury)


            F+F (Tesco)

                             0%          20%           40%          60%          80%         100%0%              20%          40%     60%   80%   100%

Q5. How would you rate the design of each item?;Q6. And how would you rate the cut of the fabric of each item? Base: All evaluating
© GfK 2012 | GfK Fashion Report | July 2012                                                                                                                  27
Product design – T2B summary by product category
At category level, the design of both Marks & Spencer and Boden’s polo shirts is rated most
favourably while the cotton shirt from Boden, which received a poor rating for quality, is also
given a poor rating for it’s design.




                                           Cargo pants                  Chinos                     Blouse                  Polo shirt   Cotton shirt
                                               (50)                      (48)                       (48)                      (48)          (48)
            Next                                 53%                      51%                        25%                       42%         59%

            Primark                              36%                      37%                        42%                       24%         40%

            Marks & Spencer                      25%                      26%                        25%                       43%         36%

            Boden                                31%                      23%                        21%                       43%         26%

            H&M                                  30%                      27%                        18%                       18%         38%

            TU (Sainsburys)                      32%                      25%                        16%                       26%         28%

            F+F (Tesco)                          14%                      23%                        23%                       22%         33%




Q5. How would you rate the design of each item?;Q6. And how would you rate the cut of the fabric of each item? Base: All evaluating
© GfK 2012 | GfK Fashion Report | July 2012                                                                                                            28
Overall performance


                                                              What could be
                        What have we
                                                                better?
                          learnt?
                                              What are the
                                              opportunities                   What’s good?




© GfK 2012 | GfK Fashion Report | July 2012                                                  29
Overall Product T2B ranking summary
Taking all product attributes into consideration, Next rated highest Overall. Primark is slightly
ahead of Marks & Spencer, predominantly due to the quality and cut of the fabric and the
design of the items. Boden falls in the middle with similar ratings for most attributes



                   Next


               Primark


  Marks & Spencer

                                                                                                                             Cut of fabric
                Boden
                                                                                                                             Design
                                                                                                                             Buttons/zips
      Tu (Sainsbury)                                                                                                         Stitching
                                                                                                                             Fabric
                  H&M


         F+F (Tesco)

                          0%         20%        40%   60%   80%     100%    0%        20%           40%   60%   80%   100%

Q3; Q4; Q5; Q6; Q7 Base: All respondents (82)
© GfK 2012 | GfK Fashion Report | July 2012                                                                                        30
Overall Product T2B ranking summary by product
 category


                                           Cargo pants   Chinos   Blouse   Polo shirt   Cotton shirt
                                               (50)       (48)     (48)       (48)          (48)
             Next                               54%       50%      31%       46%           53%

             Primark                            39%       41%      39%       35%           41%

             Marks & Spencer                    31%       36%      26%       52%           40%

             Boden                              42%       27%      23%       51%           27%

             TU (Sainsburys)                    27%       35%      23%       25%           38%

             H&M                                33%       30%      33%       24%           37%

             F+F (Tesco)                        16%       27%      23%       25%           35%




Q3; Q4; Q5; Q6; Q7 Base: All respondents (82)
 © GfK 2012 | GfK Fashion Report | July 2012                                                           31
Findings from the Sunday Times research, highlight
opportunities for all fashion retailers

                                                         For many shopping for clothes remains a
     There is inconsistency within brands across
                                                       pleasure/leisure activity (despite the financial
             the different products tested
                                                                         pressure)




                                                       It is vital that the shopping experience is good
    This must cause some stress for shoppers in-
                                                     regardless of channel (in-store, on-line, on TV, via
       store if quality varies between products
                                                                          catalogue etc.)




     Retailers should strive to deliver consistent     Focus on ensuring that the whole shopping
    quality across their range, having understood    experience is great for the customer in order to
   customers quality expectations across product     maximise satisfaction and drive repeat purchase
                      categories                                  and recommendation
© GfK 2012 | GfK Fashion Report | July 2012                                                                 32
Consistently meeting customer requirements for
quality and value will drive brand loyalty


                   Primark delivers to today’s
                        shopper needs




               It delivers on quality and value
                leading to a higher proportion
                   of Loyal Advocates than
                   Marks and Spencer who
               generally deliver on quality but
                     not always on value*
                                                  * Since the LoyaltyPlus analysis was conducted M&S
                                                  have introduced a wider Fashion Value range


© GfK 2012 | GfK Fashion Report | July 2012                                                            33
Findings from the Sunday Times research, highlight
opportunities for all fashion retailers


       The power of the brand cannot be under-       Boden did not perform well among this group of
                      estimated                     people who were generally not Boden customers



                                                    We tested using full-prices for items, but Boden
    Some very successful and respected brands       do sell predominantly on deal (multi-buy and/or
       did not perform very well in this test       25%+ discount), so loyal customers may have a
                                                               different perception of price


                                                    Care should be taken that aggressive offer-based
   Brand image and reputation can clearly help to        selling, whilst helping to retain existing
   drive sales, but no-one should be complacent       customers, doesn’t alienate those new to the
    as quality and value are ever-more important    brand who are not aware of the regularly reduced
                                                                           prices
© GfK 2012 | GfK Fashion Report | July 2012                                                            34
Appendix


                                                                  GfK Savvy
                            The Sunday
                                                                   Shopper
                            Times Study
Roper Reports
                                                 GfK Women’s                  Consumer
 Worldwide
                                                 clothing study               Confidence
                                                                              Barometer




   © GfK 2012 | GfK Fashion Report | July 2012                                             35
GfK Consumer & Retail


                                              How do I find
                        Who do I talk          out more?
                            to?




© GfK 2012 | GfK Fashion Report | July 2012                   36
GfK Group Company Profile
                                              Sales
                                              • 2011: €1.2 billion, +6.2% growth YOY
                                              • 4th largest research company, worldwide

                                              Employees
                                              • 11,000+ full-time staff
                                              • Over 1,000 in the U.K.; approximately 80% outside Germany

                                              Services
                                              • Custom Research, Media, Retail & Technology
                                              • Comprehensive information services on consumer goods, healthcare,
                                                media and services markets

                                              Global Coverage
                                              • Operating in over 100 countries



© GfK 2012 | GfK Fashion Report | July 2012                                                                         37
Consumer and Retail – an overview

                                                                  Quantitative & Qualitative


                                                                           Omnibus


   NPD & Innovation                                                                                  Consumer
    U&A / Segmentation                   Brand & Comms                                               Healthcare           Travel and Leisure
                                                                       Retail & Shopper
    Strategic Innovation                        Brand Health                                             OTC              Customer Management
                                                                      Customer Management                                 (Satisfaction & Loyalty)
           Ideation                           Brand Positioning       (Satisfaction & Loyalty)       Claims Testing
                                                                                                                                 Tourism
     Concept Screening                  Ad and Brand Tracking                Shopper                Brand & Comms
                                                                          Savvy Shopper            Switch Rx to OTC        Other specialist
           Product                             Ad Pre-testing
                                                                                                                          Consumer Services
            Pack                                 Ad Health                Decision Trees         Pharma Shopper Insight
                                                                                                                              Environmental
            Price                        Emotional Connection            Category layout             Health Trends
                                                                                                                                Regulatory
         Promotion                                                    Shopper Segmentation       HCP Recommendation




                                                                       Local & Global
© GfK 2012 | GfK Fashion Report | July 2012                                                                                                          38
Values we share

                            Genuine sector expertise
                            …understanding the challenges our clients face

                            Business impact
                            …generating insights that bring about real change

                            Creative and innovative
                            …utilising industry leading research techniques

                            Quality
                            …delivering high quality work, on time, every time

                            Passionate
                            …caring about our clients and the work we do for them

© GfK 2012 | GfK Fashion Report | July 2012                                         39
The Sunday Times Fashion Study


                                              Who did we
                         How was the
                                               talk to?
                         study done?




© GfK 2012 | GfK Fashion Report | July 2012                40
Hall test process
 • In-street recruitment to complete interview in hall (Uxbridge and Nottingham)
 • C. 30 minute interview during which, each respondent assessed products from all 7 brands
 • The majority of questions used a 5 point rating scale (very poor – excellent) to indicate opinion of a range of attributes such as
     quality of fabric, stitching, fastenings, overall design etc.
 • Each respondent evaluated 3 product categories in total from the following range, resulting in 48-50 evaluations per category
     • Cargo pants
     • Chinos
     • Blouse
     • Polo shirt
     • Cotton Shirt
 • Respondents were never informed of which item corresponded to which brand but they
 were asked to rank the brands separately in terms of preference and likelihood to purchase
 at the end of the test
 • At the end of each evaluation, respondents were advised of the actual price of each item
 (still de-branded) and asked whether they thought the item to be good value or not
 • Following the completion of the evaluations, respondents were given a list of the brands
 and asked to rank them in order of preference and likelihood to purchase

 • All fieldwork was conducted in accordance with the Market Research Society Code of Conduct
© GfK 2012 | GfK Fashion Report | July 2012                                                                                         41
Survey details
 Demographic profile                          %     Fieldwork
                                                    • 82 interviews were completed across 2 locations –
 Uxbridge                                     50%     Uxbridge and Nottingham, on Saturday 9th June 2012.
                                                    • Each respondent assessed products from all 7 brands
 Nottingham                                   50%
                                                    • Each respondent evaluated 3 product categories from
 Male                                         38%     the following range, resulting in 48-50 evaluations per
                                                      category
 Female                                       62%     • Cargo pants
 18-34                                        62%     • Chinos
                                                      • Blouse
 35-54                                        27%
                                                      • Polo shirt
 55-64                                        11%     • Cotton Shirt

 AB                                           38%

 C1                                           57%

 C2                                           5%



© GfK 2012 | GfK Fashion Report | July 2012                                                                     42
GfK Roper Consulting


                                              Who did we
                         How was the
                                               talk to?
                         study done?




© GfK 2012 | GfK Fashion Report | July 2012                43
GfK Roper Reports Worldwide | Introduction

 GfK Roper Consulting interviews more than 37,500 global consumers each year about a broad range of
    topics. Using this robust data source, we develop powerful and actionable insights about global
                        consumers in order to help our clients to ‘own the future’.


               GLOBAL                             REGIONAL              LOCAL                 MICRO




       Big picture stories                         Regional         Local level insight    Detailed focus on
       on what the world                      comparisons to the   informed by market     your key groups of
           looks like                         world as a whole…         expertise            consumers


© GfK 2012 | GfK Fashion Report | July 2012                                                                    44
GfK Roper Reports Worldwide | unrivalled coverage

     Conducted annually for 15 years         Western Europe           Developed Asia
     37,500+ consumers each year             •  France                •  Australia
                                             •  Germany
      1,500 consumers per market                                       •  Japan
                                              •  Italy
     25+ countries                                                    •  South Korea
                                              •  Spain
     Consumers aged 15+                      •  Sweden                •  Taiwan
     Covering c.83% global GDP               •  UK

                                              Central/Eastern Europe   Developing Asia
                                              •  Czech Republic        •  China
                                              •  Poland                •  Indonesia
                                              •  Russia
                                                                       •  India
                                              The Americas             •  Thailand
                                              •  USA
                                              •  Canada
                                              •  Argentina             Middle East / Africa
                                              •  Brazil                •  South Africa
                                              •  Mexico                •  Egypt
        Interviews with approximately 1,500
                                                                       •  Turkey
        consumers aged 15+ in each market
© GfK 2012 | GfK Fashion Report | July 2012                                                   45
GfK Roper Reports Worldwide | Topic Coverage

                                •     Mood of the Nation       •   Information Flow

                                •     Leisure & Lifestyle      •   Health & Wellness

                                •     Personal Values          •   Retail

                                •     Attitudes Towards Life   •   Financial attitudes

                                •     Economy                  •   Automotive

                                •     Green Behaviour          •   Consumption

                                •     Technology               •   Demographics




© GfK 2012 | GfK Fashion Report | July 2012                                              46
Some retail questions we can help to answer:

 •     Do shoppers feel now is a good time to buy or wait? How often do consumers around Europe go
       shopping for non-grocery items?

 •     Which consumers are very interested in personal
       appearance/fashion/beauty?

 •     How have your target consumers been saving
       money in the past year?

 •     Which consumers agree that “it is better to buy
       well-known brands because of their quality”?

 •     Where do we find deal hunters who say that “I feel really
       satisfied with myself, even excited when I get a really good deal”

 •     Who goes shopping to overcome stress?

 •     What types of consumers believe shopping is a chore and
       who finds shopping to be a pleasure?
© GfK 2012 | GfK Fashion Report | July 2012                                                          47
GfK Savvy Shopper


                                              Who did we
                          How was the
                                               talk to?
                          study done?




© GfK 2012 | GfK Fashion Report | July 2012                48
What is Savvy Shopper?

                             The study began in 2009 with the aim of understanding how the recession was impacting consumer
                             behaviour and spending.
 Objective                   It continues to measure how consumer concerns are evolving through the double dip recession.

                             Savvy Shopper is a twice yearly study commissioned and managed by GfK NOP.
                             Each wave updates core measures regarding consumer confidence and spending behaviour and also
                             includes topical bespoke issues
 What is
                             The 6 monthly ad hoc study is supplemented by data from GfK’s Consumer Confidence Barometer
 included?
                             commissioned by the European Commission

                            Savvy Shopper is conducted amongst a nationally representative sample of 1000 people aged 16+ in the
 Who was                    UK for each wave.
 interviewed?               Quotas were placed on gender, region, age and social grade to achieve this.



                            Research is conducted using an online methodology, using GfK NOP’s online panel
                            Wave 6 was conducted May 23rd - May 30th 2012
 How was the
 research done?


© GfK 2012 | GfK Fashion Report | July 2012                                                                                    49
GfK Women’s Clothing Study


                                              Who did we
                          How was the
                                               talk to?
                          study done?




© GfK 2012 | GfK Fashion Report | July 2012                50
Study Objectives

To explore women's attitudes to ethical issues (Fair Trade and Organic) in
the context of the clothes they buy for themselves:
        o     there is much talk of ethical brands, recycling, carbon footprints,
              food miles etc. Evidence from our own research shows we care
              and try to buy ethical in a variety of categories – food, cosmetics
              etc. – but do we apply those same morals when buying our next
              outfit?
To explore customer loyalty within the high street fashion sector
        o     using the GfK LoyaltyPlus model we explore the extent to which
              customers are loyal to individual retailers, what drives that loyalty
              and how best retailers could encourage great loyalty




      On-line study conducted among 1000 women in 2007


© GfK 2012 | GfK Fashion Report | July 2012                                           51
Questionnaire Content
Behaviour                                                  Green Issues
• Retailers browsed in                                     • Awareness and understanding of ethical issues
• Retailers purchased from                                    (Fair Trade/organic)
• Retailers intending to buy from                          • Importance and consideration of ethical
• Total personal clothing spend                               products
• Share of spend at each retailer used                     • Purchase behaviour – current and intended
                                                           • Willingness to pay a price premium for ethical
• Main store for each type of clothing (casual clothing,
                                                              products
   underwear, formalwear etc.)

Opinions                                                   Demographics
• Reasons for choice of retailer                           • Age
• Overall satisfaction                                     • Lifestage
• Importance of retailer attributes                        • Employment status
                                                           • Income
Advocacy
• Recommendation
• Word of mouth (positive and negative)



© GfK 2012 | GfK Fashion Report | July 2012                                                                   52
Retail brands included




© GfK 2012 | GfK Fashion Report | July 2012   53
Contacts


                                              How do I find
                        Who do I talk          out more?
                            to?




© GfK 2012 | GfK Fashion Report | July 2012                   54
UK clothing retailing July 2012 - GfK

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UK clothing retailing July 2012 - GfK

  • 1. GfK Fashion Report July 2012 Incorporating data from The Sunday Times Fashion Study and other GfK research Helen Roberts / Lisa Luckhurst GfK NOP, Consumer and Retail © GfK 2012 | GfK Fashion Report | July 2012 1
  • 2. Contents 1. Background and objectives of the Sunday Times Research 3 2. Consumer Mindsets – from other GfK data 5 3. Shopping for clothes 15 4. How the 7 brands performed 18 5. Quality, Price & Value 22 6. Design 26 7. Overall performance 29 8. Appendix 35 • GfK Consumer & Retail 36 • The Sunday Times Fashion Study 40 • GfK Roper Consulting 43 • GfK Savvy Shopper 47 • GfK Women’s Clothing Study 48 9. Contacts 54 © GfK 2012 | GfK Fashion Report | July 2012 2
  • 3. Background and Objectives What did we Why did we want to find do it? out? What else do How was it we know? done? © GfK 2012 | GfK Fashion Report | July 2012 3
  • 4. Background to the project The research was conducted for the Sunday Times who were keen to understand current consumer perceptions of quality, price and value for clothes from a number of leading retailers Brands evaluated 7 UK fashion retailers were included in the test: Products tested 5 items were tested from each retailer: chino’s, cargo pants, shirt, blouse and a polo shirt Survey method The research comprised 2 simultaneous hall tests, with a total of 82 respondents assessing 35 products. Further details of the method are contained in the appendix Other GfK data sources This report also draws on three other GfK data sources to add context and depth to the analysis: 1. The Consumer Confidence Barometer, conducted by GfK for the European Commission 2. Roper Reports Worldwide (Mood of World Factbook) 3. GfK Savvy Shopper 4. GfK Women’s Clothing Study © GfK 2012 | GfK Fashion Report | July 2012 4
  • 5. Consumer Mindsets How’s Are we cutting Consumer back? Confidence? What are we How are we worried about? saving money? © GfK 2012 | GfK Fashion Report | July 2012 5
  • 6. The mood of the nation is short on economic optimism! We are worried about the economic situation It’s affecting how we think It’s impacting what we do Confidence is almost as low as during the More worried banking crisis of about how we’ll 2008 maintain our lifestyle Cutting back We are increasingly more than ever targeting clothing as an area to cut back spending © GfK 2012 | GfK Fashion Report | July 2012 6
  • 7. Consumers view of the economic situation has stabilised (at a low level) since the end of 2011 General Economic situation of the Country May 2012 Better 2008 Banking crisis The Consumer Confidence Barometer Research carried out by GfK on behalf of the European Commission Q3 How do you think the general economic situation in this country has changed over the last 12 months? Worse Got a lot better = 1 / Got a little better = 0.5 / Stayed the same = 0 / Got a little worse -0.5 / Got a lot worse = -1 Q4 How do you expect the general economic situation in this country to develop over the next 12 months? Get a lot better = 1 / Get a little better = 0.5 / Stay the same = 0 / Get a little worse -0.5 / Get a lot worse = -1 © GfK 2012 | GfK Fashion Report | July 2012 7
  • 8. The economic situation, particularly the Euro crisis remains a concern and confidence in those in charge continues to fall Agree Completely or Somewhat that…% 71 71 68 68 57 56 Jun-10 Late 2010 31 Late 2011 25 May-12 15 16 n.a. The economy is in good hands Economic situation will get worse Euro crisis will have a major before it gets better impact on UK recovery Q18. Now, thinking about the economic outlook for the next 12 months, how much do you agree with the following statements? Source: GfK Savvy Shopper © GfK 2012 | GfK Fashion Report | July 2012 8
  • 9. Consumers remain negative about their own financial situation, though some optimism that next year will be better than last Personal Financial Situation of Household – May 2012 Last 12 Months Next 12 Months Better 17 15 13 11 9 7 5 3 1 June -1 June June June June June Feb-04 Apr Jun Feb-05 Apr Jun Feb-06 Feb-07 Feb-08 Feb-09 Feb-10 Feb-11 Aug Aug Aug Aug Aug Aug Aug August April April April April April April April Dec Dec Dec Dec Dec Dec Dec Dec Oct Oct Oct Oct Oct Oct Oct Oct Feb -3 -5 -7 -9 -11 The Consumer Confidence Barometer -13 -15 Research carried out by GfK on behalf of the -17 European Commission -19 -21 -23 -25 Q2 How do you expect the financial position of your household to change over the next 12 months? Get a lot better = 1 / Get a little better = 0.5 / Stay the same = 0 / Get a little worse -0.5 / Get a lot worse = -1 Worse Q1 How has the financial situation of your household changed over the last 12 months? Got a lot better = 1 / Got a little better = 0.5 / Stayed the same = 0 / Got a little worse -0.5 / Got a lot worse = -1 © GfK 2012 | GfK Fashion Report | July 2012 9
  • 10. Spending money and lifestyle are of more concern than job loss or debt 63 Agree Completely or 59 Somewhat that…% 51 43 45 40 Jun-10 Late 2010 Late 2011 25 24 23 23 May-12 18 20 17 18 Current downturn will have Concerned about how I will I believe I will have more I am concerned I may lose direct effect on money I can maintain lifestyle in coming debt this time next year my job in next 6-12 months spend year Q18. Now, thinking about the economic outlook for the next 12 months, how much do you agree with the following statements? © GfK 2012 | GfK Fashion Report | July 2012 10
  • 11. Consumers continue to feel unwilling to commit to major purchases Climate for major purchases – is now the right time to buy? Right time Major purchases Annual moving average 32 30 28 26 24 22 20 18 16 14 12 10 8 6 4 2 0 -2 Jun Aug Jun Aug Aug Aug Aug Aug Aug April April April April April April Dec April June June June June June Feb-11 June Feb Apr Feb Apr Feb Feb Feb Feb Feb August Feb Oct Dec-04 Oct Dec-05 Oct Dec-06 Oct Dec-07 Oct Dec-08 Oct Dec-09 Oct Dec-10 Oct -4 -6 -8 -10 -12 -14 -16 -18 -20 -22 -24 -26 -28 -30 -32 -34 -36 -38 -40 -42 Q8 In view of the general economic situation, do you think now is the right time for people to make major purchases such as furniture or electrical goods? Wrong time Yes, now is the right time = 1 / It is neither the right time nor the wrong time = 0 / No, it is the wrong time = -1 © GfK 2012 | GfK Fashion Report | July 2012 11
  • 12. The trend towards cutting back on clothing spend has grown more than other categories, suggesting increasing frugal behaviour in the category Euros/ GfK Savvy Shopper Purchase intent – Next 12 months Olympics effect? % “I will spend less on… minus % ”I will spend more on…” 49 May-12 Late 2011 Late 2010 45 45 46 43 43 43 41 40 39 37 37 37 37 36 33 32 32 31 31 31 29 28 26 25 24 18 Entertaining at home Saving Buying new clothes Donating to charity Planning more Eating out Going out drinking Buying new furniture Buying a large electrical holidays/short breaks item such as a TV = positive significant difference at 95% confidence level = negative significant difference at 95% confidence level Q16. Which of these do you think you will be spending more or less on over the next 12 months? Source: GfK Savvy Shopper © GfK 2012 | GfK Fashion Report | July 2012 12
  • 13. Clothing and Shoes are 3rd in a list of 26 areas of expenditure that people in the UK have cut back on Roper Reports Worldwide 2011 and 2012 | Mixed-mode trend, core 25 countries % who have cut back on things in past 12 months Source: GfK Roper Reports Worldwide © GfK 2012 | GfK Fashion Report | July 2012 13
  • 14. Cutting back involves the use of multiple money saving techniques and shopping carefully for essentials including clothes is the 2nd most widely taken action Roper Reports Worldwide 2012 (mixed-mode trend, core 25 countries), % who have done activity in the past 12 months Source: GfK Roper Reports Worldwide © GfK 2012 | GfK Fashion Report | July 2012 14
  • 15. Shopping for clothes How do we What’s choose what to important? buy? Value? Style? Quality? Price? © GfK 2012 | GfK Fashion Report | July 2012 15
  • 16. We are conservative when it comes to buying clothes! We are not driven purely by the latest trend when buying clothes Most are far more concerned about quality and value (and getting a bargain). The Savvy Shopper mindset is strong when shopping for clothes The Shopping Range & Style Experience My Kind of Store The decision on where to shop for clothes is shaped by this core Savvy mindset and then influenced by the clothing range on Ethics offer and the retail experience My Kind of Value for Money, Clothes © GfK 2012 | GfK Fashion Report | July 2012 Source: GfK Green Clothing study 16
  • 17. Fashion shopping behaviour It’s clear that getting a bargain is important to respondents but aside from this, buying quality items and brand loyalty are important. Perhaps unsurprisingly, given the typical ‘Middle England’ profile of the sample, having the latest fashion is lower in their list of priorities when buying clothing I like to seek out a bargain 77% I always buy high quality clothes 44% I like to stick to the same brands 41% The brand of clothes I wear matters 30% I am happy to pay a price premium 20% just to have ‘in-fashion’ items I always try to buy the latest fashion 15% Fashion is more important to me than quality 10% Source: the Sunday Times Fashion Study © GfK 2012 | GfK Fashion Report | July 2012 17
  • 18. How the 7 brands performed What are their Who’s the strengths? best? Who’s worst? How can they improve? © GfK 2012 | GfK Fashion Report | July 2012 18
  • 19. Key findings Positive takeouts Negative takeouts • Rated best products overall in blind test, • Ranked 5th out of 7 in terms of good value particularly on cut of fabric, design and quality of buttons/zips • Ranked top in terms of preference and likelihood to purchase (although currently used for everyday purchases by just 17% of sample) • Rated best value for money • Quality of buttons/zips was relatively low compared with • Placed 2nd overall in blind test, with quality of other retailers fabric and stitching • Blouse design was particularly popular • Very close overall ranking to Primark, • Poor performance on value for money, ranking 6th out of 7 performing particularly well in terms of quality and design of it’s Polo Shirt • Middle ranking overall but with 2nd highest rating • Very poor performance in terms of value for money, on quality of Cargo Pants and Polo Shirt • Perception of quality and design of Cotton Shirt was very poor in blind test • Lowest ranked in terms of likelihood to purchase and Source: The Sunday Times Fashion Study preference and not currently used for everyday purchases by © GfK 2012 | GfK Fashion Report | July 2012 any of the sample 19
  • 20. Key findings Positive takeouts Negative takeouts • Ranks 3rd on good value for money • Poorest performance in terms of overall design in blind test • Ranked 6th out of 7 overall in blind test • Used for everyday purchases by 1 in 4 respondents • 40% of respondents expected products to be low priced • 2nd highest ranking in terms of preference and based on evaluation of quality and design likelihood to purchase • Blouse quality was considered to be particularly high • Ranks 2nd on good value for money • Poorest performance overall in blind test • Products least likely to be considered ‘high priced’ based on evaluation of quality and design (8%) • Ranked 6th out of 7 on brand preference and likelihood to purchase and Source: The Sunday Times Fashion Study © GfK 2012 | GfK Fashion Report | July 2012 20
  • 21. Brand preference and likelihood to purchase Respondents were given a list of the 7 brands and were asked to rank in order of preference and likelihood to purchase. Next , H&M and Marks & Spencer are the clear favourites, with Boden receiving the lowest rating for both % typically buying everyday clothes from each retailer 26% 23% 23% 5% 2% - 17% Ranking in order of preference and likelihood to purchase 7 6 Likely to 5 buy Preferred 4 3 2 1 H&M Primark M&S TU (Sainsbury) F+F (Tesco) Boden Next Q1. Can you tell me where you typically buy everyday clothes for yourself and/or your family? Q10. Here is a list of clothing brands. Please rank them in order of a)Preference b)How likely you are to buy? Base: All respondents (82) © GfK 2012 | GfK Fashion Report | July 2012 21
  • 22. Quality, Price & Value Who is the best Who has the value? best quality? Who has the best price? © GfK 2012 | GfK Fashion Report | July 2012 22
  • 23. Product quality – T2B ranking summary Taking all product categories into consideration, Next and Marks & Spencer rated highest in terms of quality. Boden falls in the middle with very similar ratings for all quality questions – and, somewhat surprisingly, below Primark. Next Marks & Spencer Primark Buttons/zips Boden Stitching Fabric Tu (Sainsbury) H&M F+F (Tesco) 0% 20% 40% 60% 80% 100% 0% 20% 40% 60% 80% 100% Q3. Please tell me, for each of the clothing items on the table, what you think of the quality of the fabric using a scale of 1-5 where 5 = excellent and 1 = very poor;? Q4. And what you think of the quality of the stitching/workmanship?; Q7. What you think of the quality of buttons, zips fastenings etc.? Base: All respondents (82) © GfK 2012 | GfK Fashion Report | July 2012 23
  • 24. Quality – %T2B summary by product category Looking at the quality at product level, Boden’s cargo pants and polo shirts are rated highly compared with the majority of other brands but their cotton shirt, which is actually their most expensive item, is considered poorer quality than any of the other brands. Respondents had a similarly poor opinion of their chinos and blouse. H&M, generally a poor performer across the board, received a very positive rating of the blouse evaluated Cargo pants Chinos Blouse Polo shirt Cotton shirt (50) (48) (48) (48) (48) Next 54% 49% 35% 49% 50% Marks & Spencer 35% 23% 27% 58% 42% Primark 41% 44% 37% 42% 42% Boden 50% 29% 25% 56% 28% TU (Sainsburys) 24% 42% 28% 24% 45% H&M 35% 32% 43% 29% 36% F+F (Tesco) 18% 29% 23% 28% 37% Q3. Please tell me, for each of the clothing items on the table, what you think of the quality of the fabric using a scale of 1-5 where 5 = excellent and 1 = very poor;? Q4. And what you think of the quality of the stitching/workmanship?; Q7. What you think of the quality of buttons, zips fastenings etc.? Base: All evaluating © GfK 2012 | GfK Fashion Report | July 2012 24
  • 25. Price (average across all categories) Of all products evaluated, respondents were most split by Boden items, with c.one third each saying the price should be low, medium and high. Next clothing was considered the most likely to be expensive and Tesco items the cheapest. Based on the actual price of each item, Boden’s were rated by far the least value for money and Primark the best. Estimated price ranking (de-branded evaluation) Good value for money (de-branded evaluation) %T2B Next 21% 44% 34% 54% Primark 30% 49% 21% 88% M&S 27% 47% 26% 41% Boden 38% 32% 30% 20% TU (Sainsbury) 40% 39% 21% 65% H&M 40% 51% 12% 61% F+F (Tesco) 45% 46% 8% 71% Low Medium High Q8. Thinking now about cost, please rank each item according to whether you think the price would be ‘low’, ‘medium’ or ‘high’. Q9. Given the actual price, to what extent do you agree that the item is good value? Base: All respondents (82) © GfK 2012 | GfK Fashion Report | July 2012 25
  • 26. Design Does it vary by Who has the product? best design? © GfK 2012 | GfK Fashion Report | July 2012 26
  • 27. Product design – T2B ranking summary The design of the items from Next was the most popular amongst the selection reviewed and Boden is mid-range as was the case for it’s quality (although, interestingly it is less popular on both aspects amongst 35-64 year old respondents). Primark performs favourably again, achieving second place and Tesco clothing once again is least popular. Next Primark Marks & Spencer Cut of fabric Boden Design H&M Tu (Sainsbury) F+F (Tesco) 0% 20% 40% 60% 80% 100%0% 20% 40% 60% 80% 100% Q5. How would you rate the design of each item?;Q6. And how would you rate the cut of the fabric of each item? Base: All evaluating © GfK 2012 | GfK Fashion Report | July 2012 27
  • 28. Product design – T2B summary by product category At category level, the design of both Marks & Spencer and Boden’s polo shirts is rated most favourably while the cotton shirt from Boden, which received a poor rating for quality, is also given a poor rating for it’s design. Cargo pants Chinos Blouse Polo shirt Cotton shirt (50) (48) (48) (48) (48) Next 53% 51% 25% 42% 59% Primark 36% 37% 42% 24% 40% Marks & Spencer 25% 26% 25% 43% 36% Boden 31% 23% 21% 43% 26% H&M 30% 27% 18% 18% 38% TU (Sainsburys) 32% 25% 16% 26% 28% F+F (Tesco) 14% 23% 23% 22% 33% Q5. How would you rate the design of each item?;Q6. And how would you rate the cut of the fabric of each item? Base: All evaluating © GfK 2012 | GfK Fashion Report | July 2012 28
  • 29. Overall performance What could be What have we better? learnt? What are the opportunities What’s good? © GfK 2012 | GfK Fashion Report | July 2012 29
  • 30. Overall Product T2B ranking summary Taking all product attributes into consideration, Next rated highest Overall. Primark is slightly ahead of Marks & Spencer, predominantly due to the quality and cut of the fabric and the design of the items. Boden falls in the middle with similar ratings for most attributes Next Primark Marks & Spencer Cut of fabric Boden Design Buttons/zips Tu (Sainsbury) Stitching Fabric H&M F+F (Tesco) 0% 20% 40% 60% 80% 100% 0% 20% 40% 60% 80% 100% Q3; Q4; Q5; Q6; Q7 Base: All respondents (82) © GfK 2012 | GfK Fashion Report | July 2012 30
  • 31. Overall Product T2B ranking summary by product category Cargo pants Chinos Blouse Polo shirt Cotton shirt (50) (48) (48) (48) (48) Next 54% 50% 31% 46% 53% Primark 39% 41% 39% 35% 41% Marks & Spencer 31% 36% 26% 52% 40% Boden 42% 27% 23% 51% 27% TU (Sainsburys) 27% 35% 23% 25% 38% H&M 33% 30% 33% 24% 37% F+F (Tesco) 16% 27% 23% 25% 35% Q3; Q4; Q5; Q6; Q7 Base: All respondents (82) © GfK 2012 | GfK Fashion Report | July 2012 31
  • 32. Findings from the Sunday Times research, highlight opportunities for all fashion retailers For many shopping for clothes remains a There is inconsistency within brands across pleasure/leisure activity (despite the financial the different products tested pressure) It is vital that the shopping experience is good This must cause some stress for shoppers in- regardless of channel (in-store, on-line, on TV, via store if quality varies between products catalogue etc.) Retailers should strive to deliver consistent Focus on ensuring that the whole shopping quality across their range, having understood experience is great for the customer in order to customers quality expectations across product maximise satisfaction and drive repeat purchase categories and recommendation © GfK 2012 | GfK Fashion Report | July 2012 32
  • 33. Consistently meeting customer requirements for quality and value will drive brand loyalty Primark delivers to today’s shopper needs It delivers on quality and value leading to a higher proportion of Loyal Advocates than Marks and Spencer who generally deliver on quality but not always on value* * Since the LoyaltyPlus analysis was conducted M&S have introduced a wider Fashion Value range © GfK 2012 | GfK Fashion Report | July 2012 33
  • 34. Findings from the Sunday Times research, highlight opportunities for all fashion retailers The power of the brand cannot be under- Boden did not perform well among this group of estimated people who were generally not Boden customers We tested using full-prices for items, but Boden Some very successful and respected brands do sell predominantly on deal (multi-buy and/or did not perform very well in this test 25%+ discount), so loyal customers may have a different perception of price Care should be taken that aggressive offer-based Brand image and reputation can clearly help to selling, whilst helping to retain existing drive sales, but no-one should be complacent customers, doesn’t alienate those new to the as quality and value are ever-more important brand who are not aware of the regularly reduced prices © GfK 2012 | GfK Fashion Report | July 2012 34
  • 35. Appendix GfK Savvy The Sunday Shopper Times Study Roper Reports GfK Women’s Consumer Worldwide clothing study Confidence Barometer © GfK 2012 | GfK Fashion Report | July 2012 35
  • 36. GfK Consumer & Retail How do I find Who do I talk out more? to? © GfK 2012 | GfK Fashion Report | July 2012 36
  • 37. GfK Group Company Profile Sales • 2011: €1.2 billion, +6.2% growth YOY • 4th largest research company, worldwide Employees • 11,000+ full-time staff • Over 1,000 in the U.K.; approximately 80% outside Germany Services • Custom Research, Media, Retail & Technology • Comprehensive information services on consumer goods, healthcare, media and services markets Global Coverage • Operating in over 100 countries © GfK 2012 | GfK Fashion Report | July 2012 37
  • 38. Consumer and Retail – an overview Quantitative & Qualitative Omnibus NPD & Innovation Consumer U&A / Segmentation Brand & Comms Healthcare Travel and Leisure Retail & Shopper Strategic Innovation Brand Health OTC Customer Management Customer Management (Satisfaction & Loyalty) Ideation Brand Positioning (Satisfaction & Loyalty) Claims Testing Tourism Concept Screening Ad and Brand Tracking Shopper Brand & Comms Savvy Shopper Switch Rx to OTC Other specialist Product Ad Pre-testing Consumer Services Pack Ad Health Decision Trees Pharma Shopper Insight Environmental Price Emotional Connection Category layout Health Trends Regulatory Promotion Shopper Segmentation HCP Recommendation Local & Global © GfK 2012 | GfK Fashion Report | July 2012 38
  • 39. Values we share Genuine sector expertise …understanding the challenges our clients face Business impact …generating insights that bring about real change Creative and innovative …utilising industry leading research techniques Quality …delivering high quality work, on time, every time Passionate …caring about our clients and the work we do for them © GfK 2012 | GfK Fashion Report | July 2012 39
  • 40. The Sunday Times Fashion Study Who did we How was the talk to? study done? © GfK 2012 | GfK Fashion Report | July 2012 40
  • 41. Hall test process • In-street recruitment to complete interview in hall (Uxbridge and Nottingham) • C. 30 minute interview during which, each respondent assessed products from all 7 brands • The majority of questions used a 5 point rating scale (very poor – excellent) to indicate opinion of a range of attributes such as quality of fabric, stitching, fastenings, overall design etc. • Each respondent evaluated 3 product categories in total from the following range, resulting in 48-50 evaluations per category • Cargo pants • Chinos • Blouse • Polo shirt • Cotton Shirt • Respondents were never informed of which item corresponded to which brand but they were asked to rank the brands separately in terms of preference and likelihood to purchase at the end of the test • At the end of each evaluation, respondents were advised of the actual price of each item (still de-branded) and asked whether they thought the item to be good value or not • Following the completion of the evaluations, respondents were given a list of the brands and asked to rank them in order of preference and likelihood to purchase • All fieldwork was conducted in accordance with the Market Research Society Code of Conduct © GfK 2012 | GfK Fashion Report | July 2012 41
  • 42. Survey details Demographic profile % Fieldwork • 82 interviews were completed across 2 locations – Uxbridge 50% Uxbridge and Nottingham, on Saturday 9th June 2012. • Each respondent assessed products from all 7 brands Nottingham 50% • Each respondent evaluated 3 product categories from Male 38% the following range, resulting in 48-50 evaluations per category Female 62% • Cargo pants 18-34 62% • Chinos • Blouse 35-54 27% • Polo shirt 55-64 11% • Cotton Shirt AB 38% C1 57% C2 5% © GfK 2012 | GfK Fashion Report | July 2012 42
  • 43. GfK Roper Consulting Who did we How was the talk to? study done? © GfK 2012 | GfK Fashion Report | July 2012 43
  • 44. GfK Roper Reports Worldwide | Introduction GfK Roper Consulting interviews more than 37,500 global consumers each year about a broad range of topics. Using this robust data source, we develop powerful and actionable insights about global consumers in order to help our clients to ‘own the future’. GLOBAL REGIONAL LOCAL MICRO Big picture stories Regional Local level insight Detailed focus on on what the world comparisons to the informed by market your key groups of looks like world as a whole… expertise consumers © GfK 2012 | GfK Fashion Report | July 2012 44
  • 45. GfK Roper Reports Worldwide | unrivalled coverage  Conducted annually for 15 years Western Europe Developed Asia  37,500+ consumers each year • France • Australia  • Germany 1,500 consumers per market • Japan • Italy  25+ countries • South Korea • Spain  Consumers aged 15+ • Sweden • Taiwan  Covering c.83% global GDP • UK Central/Eastern Europe Developing Asia • Czech Republic • China • Poland • Indonesia • Russia • India The Americas • Thailand • USA • Canada • Argentina Middle East / Africa • Brazil • South Africa • Mexico • Egypt Interviews with approximately 1,500 • Turkey consumers aged 15+ in each market © GfK 2012 | GfK Fashion Report | July 2012 45
  • 46. GfK Roper Reports Worldwide | Topic Coverage • Mood of the Nation • Information Flow • Leisure & Lifestyle • Health & Wellness • Personal Values • Retail • Attitudes Towards Life • Financial attitudes • Economy • Automotive • Green Behaviour • Consumption • Technology • Demographics © GfK 2012 | GfK Fashion Report | July 2012 46
  • 47. Some retail questions we can help to answer: • Do shoppers feel now is a good time to buy or wait? How often do consumers around Europe go shopping for non-grocery items? • Which consumers are very interested in personal appearance/fashion/beauty? • How have your target consumers been saving money in the past year? • Which consumers agree that “it is better to buy well-known brands because of their quality”? • Where do we find deal hunters who say that “I feel really satisfied with myself, even excited when I get a really good deal” • Who goes shopping to overcome stress? • What types of consumers believe shopping is a chore and who finds shopping to be a pleasure? © GfK 2012 | GfK Fashion Report | July 2012 47
  • 48. GfK Savvy Shopper Who did we How was the talk to? study done? © GfK 2012 | GfK Fashion Report | July 2012 48
  • 49. What is Savvy Shopper? The study began in 2009 with the aim of understanding how the recession was impacting consumer behaviour and spending. Objective It continues to measure how consumer concerns are evolving through the double dip recession. Savvy Shopper is a twice yearly study commissioned and managed by GfK NOP. Each wave updates core measures regarding consumer confidence and spending behaviour and also includes topical bespoke issues What is The 6 monthly ad hoc study is supplemented by data from GfK’s Consumer Confidence Barometer included? commissioned by the European Commission Savvy Shopper is conducted amongst a nationally representative sample of 1000 people aged 16+ in the Who was UK for each wave. interviewed? Quotas were placed on gender, region, age and social grade to achieve this. Research is conducted using an online methodology, using GfK NOP’s online panel Wave 6 was conducted May 23rd - May 30th 2012 How was the research done? © GfK 2012 | GfK Fashion Report | July 2012 49
  • 50. GfK Women’s Clothing Study Who did we How was the talk to? study done? © GfK 2012 | GfK Fashion Report | July 2012 50
  • 51. Study Objectives To explore women's attitudes to ethical issues (Fair Trade and Organic) in the context of the clothes they buy for themselves: o there is much talk of ethical brands, recycling, carbon footprints, food miles etc. Evidence from our own research shows we care and try to buy ethical in a variety of categories – food, cosmetics etc. – but do we apply those same morals when buying our next outfit? To explore customer loyalty within the high street fashion sector o using the GfK LoyaltyPlus model we explore the extent to which customers are loyal to individual retailers, what drives that loyalty and how best retailers could encourage great loyalty  On-line study conducted among 1000 women in 2007 © GfK 2012 | GfK Fashion Report | July 2012 51
  • 52. Questionnaire Content Behaviour Green Issues • Retailers browsed in • Awareness and understanding of ethical issues • Retailers purchased from (Fair Trade/organic) • Retailers intending to buy from • Importance and consideration of ethical • Total personal clothing spend products • Share of spend at each retailer used • Purchase behaviour – current and intended • Willingness to pay a price premium for ethical • Main store for each type of clothing (casual clothing, products underwear, formalwear etc.) Opinions Demographics • Reasons for choice of retailer • Age • Overall satisfaction • Lifestage • Importance of retailer attributes • Employment status • Income Advocacy • Recommendation • Word of mouth (positive and negative) © GfK 2012 | GfK Fashion Report | July 2012 52
  • 53. Retail brands included © GfK 2012 | GfK Fashion Report | July 2012 53
  • 54. Contacts How do I find Who do I talk out more? to? © GfK 2012 | GfK Fashion Report | July 2012 54