Marketing Analisis. Primark

INTRODUCTION TO MARKETING 07 02662
PRIMARK
ANALYSIS OF ITS MARKETING STRATEGIES

1. Introduction – Primark’s recent success in the clothing retail industry.

In the 21st century companies find themselves in industries with demanding customers, increasing costs and high regulation as well as facing new global competition. More than ever a good marketing strategy can decide betweenprofitability and losses. This is especially true for the high street fashion, which is one of the fastest changing and most competitive business environments. The whole clothing retail industry has seen big changes with Primark and department stores testing the competitiveness of the established firms such as Marks & Spencer or H&M.
Today, Primark has become one of the fastest growingcompanies in the clothing retail industry. With over 124 stores in the UK, it is the 5th largest clothing retailer and the second biggest in the value clothing retail market. Primark’s ability to have a flexible supply chain at low costs has made it possible for the company to react to constantly changing preferences and customer’s perception of what is fashionable. This makes it difficult for otherestablished companies to retaliate against Primark’s attacks. The success of Primark has received a lot of acknowledgment with Primark winning prices such as the ECE Retail Award for ‘Newcomer of the Year’, the ITV Lorraine High Street Fashion Awards 2011 for ‘Best Affordable Fashion’ and the Cosmopolitan Fashion Award 2011 for ‘Best Bargains’. Primark is therefore an interesting company that hasmanaged to create new strategies to penetrate a difficult market and cope with potential threads such as the recession. This case study of Primark’s marketing strategy will try to single out possible key steps in marketing to be successful in any competitive market.
This essay will analyse the way Primark has created its strong present position in the past and which possible strategies to employin the future. A PEST analysis and the Porter’s Five Forces Model will give us an insight to the specific characteristics of the clothing industry. Looking at secondary data we will then try to identify key reasons for Primark’s current position analyzing strategies, the 4 P’s, i.e. the methods of production and Primark’s marketing mix. With this knowledge as a basis the last part of the essaywill focus on possible tactics Primark should use to retain or increase growth and profitability.

2. Effects of the environment on the clothing retail industry.

Due to the increased globalization of politics and the economy, firms have to be aware of the whole picture before they decide which strategy to use: To achieve a competitive advantage and a successful marketing strategy, companieshave to look at all the external factors that potentially influence their profit margins. They need to take the macro-environment, but also the strengths and the weaknesses of their rivals into consideration. This is the only way for firms to proactively find new opportunities and avoid possible threads instead of being limited to react to their environment.

2.1 PEST Analysis.

The PESTanalysis is a popular marketing tool which aims to examine the macro-environment with its political, economic, social-cultural and technological factors: The political aspect can include all government regulations and policies in the countries a company is operating in. For instance tax policy, employment laws or political stability must be considered as potential influences. For the economicfactor, the PEST analysis looks at interest rates, level of inflation and Gross Domestic Product of the targeted markets. The third point of the analysis, the social-cultural, focuses on attitudes to foreign products and services, language impacts, leisure of the consumers, etc. Finally, the technological factor considers distribution and communication channels, outsourcing decisions and rate of...