TopShop: A Fast Fashion Giant

It was announced last week that the Hudson’s Bay Company is bringing UK retailer Topshop to Canada this fall. This is exciting news for young, fashionable consumers who shop at fast-fashion retailers such as H&M and Zara. The inclusion of Topshop into many Bay stores is a part of an effort to revive the image of Hudson’s Bay Company. Due to Topshop’s international success, it is forecasted that there could be up to 50 stores in Canada within the next five years.

TopShop has 300 stores in the United Kingdom with another 50 international stores. The flagship store is on Oxford Street in London, and boasts three floors full of clothing, shoes and accessories. In addition to the conventional merchandise sold, the flagship store has a candy shop, free massages and manicure services. The retail chain attempts to differentiate itself from its competitors by creating an exciting in-store experience for consumers.

Throughout the 1990s, the Topshop chain experienced slow market growth. The brand was unfashionable and was not popular among young consumers. Jane Shepherdson was hired as brand director in 1999 and revolutionized the Topshop image. She helped increase the chain’s annual turnover to 500 million GBP across all stores. Shepherdson claims that the success of Topshop is due in part to speed to market and investment in product development. Topshop produces 7000 lines every season that almost always sell out within weeks. The brand has capitalized among the youth market and the opportunity to satisfy hedonic needs. As a fast-fashion giant in the UK, Topshop is an example of a company that operates under the trickle-down effect. When celebrities such as Kate Moss and Sienna Miller are seen wearing a fashionable item, Topshop capitalizes on the trends and engages in speed to market so that consumers can have a similar item within days or weeks.

The success of Topshop is also a result of the company’s engagement and investment in its customers. Topshop provides personal shopping and at-home delivery to time sensitive shoppers. They also provide discounts and promotional events for their customers, including student discounts and shop-a-thons equipped with free breakfast and beauty services. During her time as brand director, Shepherdson would also visit the flagship location at least 3 times a week to observe store activity. Observational research is effective because it captures the process and outcome without any special requirements or equipment. It is not invasive and allows a company to understand the shopping experience from the consumer’s point of view.

It is clear that Topshop has reached success in the fast-fashion retailing segment. During the economic downturn in 2008, they managed to bring in 100million GBP in revenues. By expanding Topshop into Canada, the company is faced with a competitive market of low-cost, fast-fashion retailers such as H&M, Zara and Joe Fresh. I think that Topshop will be a strong competitor in this segment because of its edgy, fun fashions. Furthermore, the Hudson’s Bay Company has already been trying to rejuvenate its brand selection and I believe that Topshop will bring more fashion-forward, young consumers into Bay stores across Canada.

Sources:

http://www.mirror.co.uk/news/tm_objectid=16261614&method=full&siteid=115875&headline=shy-genius-who-turned-flopshop-into-the-high-st-darling-topshop---name_page.html

http://www.insideretailing.com.au/Latest/tabid/53/ID/651/Topshops-turnaround.aspx

http://www.theglobeandmail.com/report-on-business/uk-retailer-topshop-coming-to-canada/article1934430/