The Spanish fashion industry is increasingly gaining traction not only in the national market but also internationally. The most important sectors of the fashion industry in Spain are footwear and textile, and there are already several Spanish-based luxury companies that are doing very well, operating in both the local and global markets. The fashion industry in Spain is characterized by massive numbers of competitors and globalization, and this is the reason why many companies are pushing to get some ground in the international markets. The industry is so globalized to the point that some companies have already reached a 90 percent margin of going international. It seems like the success of a new fashion company in Spain is mainly dependent on its internationalization with a focus on making a difference in a variety of markets. However, one sector that is yet to be embraced by several fashion companies in this market is the use of the online platform. The young people are avid users of social media platforms like Instagram and Facebook, and this would offer a perfect marketing platform for basing an online luxury brand. Beau, which is the name of this new company, is an online fashion brand based in Spain that is committed to offering new and exceptional products for millenniums through social media platforms. The next sections aim at conducting a SWOT analysis for Beau with the goal of determining the viability of the company.
Strengths
Instant : The key strength that is expected to give Beau the most traction is the instant service offering. The company targets the millenniums, a group of people who love having things done for them instantly. Providing products through the social media platforms further enhances this experience considering the fact that the largest section of the market spends most of its time scrolling through the social media pages. That said, the customers will simply make an order and then continue enjoying their feed. The products will then get delivered to them.
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Unique and Original Products: Beau intends to leverage on offering unique and high-quality products at affordable prices. The millenniums are a group of people who are very particular on what they wear, which means that Beau has to be particularly keen on what they offer. The fact that this is the basic focus of the company makes it a key strength.
Free Trade Agreements : Spain, and Europe in general, has had free trade agreements, which will be crucial for Beau when it comes to boosting its sales. The FTAs will especially come in handy when Beau decides to go international because it allows for free movement of goods between the European countries without imposing any border tariffs (Leticia Bejarano, 2019).
Excellent Economic Environment : The economic environment in Spain is fast-growing, and this is a major advantage that Beau will leverage on to boost sales. Spain has a high population and high levels of unemployment, which means low cost of labor and low production costs, and this translates to reduced prices. It will be easier for Beau to attract customers with low pricing levels.
Convenience : The fact that Beau will be purely online based makes it possible for the customers to shop 24/7 and also allows potential customers to compare prices. This is a convenience that very few will be willing to miss out on.
Weakness
One of the key weaknesses that Beau has is the fact that it provides niche luxury products, meaning that the company offers a limited product range in comparison to other international brands. For this reason, some potential customers may be turned back when they do not find a specific product that they were looking for.
Also, the company product offering lacks ethnicity variety, which could be critical for the company with the changing consumer tastes and diverse culture in Spain.
Opportunities
The use of Technology: Beau could also consider embracing the developing augmented reality technology that makes it possible for the customers to see the manner in which specific pieces of clothing look on the models. This technology can be incorporated in the online market in such a way that a sensor is added in all the orders, and a customer is presented with multiple outfit ranges whenever they use the sensor. This technology offers an excellent platform to attract young customers (Leticia Bejarano, 2019).
Use of AI to Enhance Customer Experience: As an online based company, AI is an essential aspect for the operation of Beau, and it is the best way for the company to offer first-class customer service. AI will make it possible for Beau to offer customer-oriented services and to maximize on the customers who are interested in their products.
Investing in Social Media Marketing: Beau should take advantage of its opportunity for market extension. The best way to reach as many clients s possible is by maximizing on the sponsored post offerings so that their products can reach as many people as possible. Social media ads are a great way of bringing in new business and also potentially improving the company's profitability.
Establishment in Emerging Markets: Markets like Nigeria, Brazil, and South Africa are continuously growing and developing. Beau should aim at establishing a base in these new markets for improved performance.
Fully Digitized Platform: Beau can also consider fully digitizing its operations to attract and engage the young population. For instance, digitization can be achieved by shifting from social media to app-based commerce to enhance customer experience and boost sales.
Beau should also consider backing some of its flagship designs. Most top brands have the trait of having some flagship designs for their stores. The brand should focus on having some specific designs that are always sold from the Beau platform, and this is a great way of increasing demand for the products. Flagship designs also help improve brand identity.
Increase in customer spending and the economic uptick in Spain after the years of slow growth rate and recession in the industry presents an opportunity for Beau to attract new customers and expand its market share.
Also, Beau should take advantage of the specter of unemployment in Spain to maximize on the low cost of production and labor.
Threats
Competition
The fashion industry in Spain is highly competitive, and Beau will have to do a lot of work to remain unique and relevant. The advantage that Beau has over its competition is the fact that the brand is entirely online, it offers unique, original, and high-quality products, and it fairly affordable in comparison to other luxury brands. All the same, the competition results in a saturation within the semi-premium segment, and this has an indirect effect on the margins. Some of the key competitors that Beau should look out for include:
John Lewis , a retailer who has taken up the Omniture SearchCenter to optimize paid search marketing. As a result, the brand has managed to acquire and optimize its customers. John Lewis has an excellent online strategy, through which the company manages to draw millions of customers to the company website each month.
New Look is a famous ladies' fashion store that has embraced an excellent online marketing strategy by using sponsored links on the top search engines and maximizing on the social websites and platforms to keep its customers close .
Debenhams is another luxury brand that maximizes on search engine optimizations on social websites and different blogs. The brand has managed to rise very fats because it leverages on not only the physical clients but also the ones who make online purchases.
Product Reproduction : The extensive competition in the fashion industry places Beau at the risk of other local shops reproducing its products and selling them off at lower prices. It is, therefore essential that the company enforces strong copyright laws to discourage such practices.
Vast Culture : Another issue that Beau is likely to experience is that the culture in Spain is vast so there is a need for the company to be able to offer products that cater to everyone.
References
Cortez, M. A., Tu, N. T., Van Anh, D., Ng, B. Z., & Vegafria, E. (2014). Fast fashion quadrangle: An analysis. Academy of Marketing Studies Journal, 18(1), 1.
Leticia Bejarano, R. (2019). Analysis of the Spanish fashion industry - Máster Carlos III MaDI. Retrieved from https://madi.uc3m.es/en/international-research-en/markets-and-industries-en/spanish-fashion-industry/
