Giordano is one of the better known apparel brands to originate from Asia with its presence in several countries across the region and the Middle East. Operating as a retailer of casual wear, it offers customers good value for money by combining trendy, comfortable and good quality clothes at affordable prices.
Giordano offers four different brands: Giordano, Giordano Ladies, Giordano Junior and Bluestar Exchange, each catering to a distinct segment of the market. It has built its brand equity by combining responsive customer service, product innovation, good quality and friendly staff.
Giordano was founded by Jimmy Lai in 1980. The name was intentionally selected to add an international dimension to the brand. Giordano initially started by selling clothes manufactured for the United States market as a wholesale trade. In 1983, Giordano started selling products under the brand name Giordano with its own retail outlets. Faced with intense competition, Giordano, from its inception has been harping on the value for money concept. Especially during the Asian financial crisis period in the 1990s, Giordano was able to sustain and grow due to their philosophy as more and more customers became price and value conscious.
Giordano won the first round of competition by being the first mover in the value apparel segment in Asia. The Asian financial crisis gave Giordano an opportunity to consolidate its positioning. Though these factors helped Giordano to grow, one of the more important reasons for its success has been its relentless drive to build a strong brand based on their corporate values and vision: “To be the best and biggest world brand in apparel retailing”.
The branding philosophy is based on excellent customer service, quality merchandise, product innovation and a value-for-money positioning. All these values have resonated within the many Asian markets that Giordano operates in. Giordano traditionally has been a heavy advertiser using outdoor media among others to communicate its value proposition.
Customer service: Right from its inception, Giordano has used service as one of its main differentiating factors. Giordano has integrated the front and back end of providing services in a successful manner. To provide excellent service, a company needs to have professionally trained personnel.
Giordano has put in place a structured training program called “attitude training” which not only trains Giordano’s staff, but also assists in recruiting the right type of people who fit the corporate culture. In recruiting people, Giordano selects those whose attitudes match the company’s corporate culture. This selection criterion ensures that customers are provided with the best service. By having specially designed training rooms equipped with one way mirrors, video cameras, training consultants and full-time training faculty, it spends considerable time and effort in training every employee. By introducing many training modules on different aspects of service, Giordano also provides flexibility to its employees to choose from those modules to gain expertise in certain specific aspects.
One of the main factors for this enduring service orientation has been the solid support from the corporate management. A case in point is that the entire management and staff at the headquarters in Hong Kong serves at a Giordano outlet during the Christmas and Chinese New Year break to drive home their commitment to customer service. This also ensures a strong feedback loop back to the corporate management.
Quality merchandise: Giordano has been offering apparel that reflects contemporary and easy living lifestyle by combining simplicity in design and quality in its workmanship. By providing appealing designs in vibrant colors for each of the segments through its brand portfolio, Giordano has been able to maximize its revenue generation. Moreover, by managing its inventory and stock levels through just-in-time and quick response inventory systems, Giordano has been able to respond quickly to changes in trends that are crucial in the retail industry. By communicating the quality aspect of the brand, Giordano has created a sense of security in customers’ minds by meeting their expectations consistently.
Product innovation: Bringing in new features and materials and making them affordable to its customer segments has been the trademark of Giordano. A case in point here is the DryTech product that Giordano introduced. This fabric with its moisture management property was similar to that being used by Nike in their sportswear products. By exploiting this nature of the fabric and making multi purpose apparel for different occasions, Giordano created avenues to bring in innovative products into the value-for-money mass market. By consistently coming up with new products, Giordano has been able to create an image of a brand that is proactive, fresh, and contemporary.
Value for money positioning: Giordano positioned itself as a value for money apparel retailer during the late 1980s and reinforced it again during the Asian financial crisis. With the customers becoming more value and price conscious, this was an ideal positioning for Giordano. Despite being value-for-money apparel, Giordano has been able to maintain its quality perception.
While Zara and Mango operate with apparel for a similar segment, the price points differentiate Giordano Ladies. Though Giordano Ladies is priced almost 30% higher than the core Giordano brand, it still provides value-for-money perception in that specific segment by combining quality with affordability. This again has stressed the overall positioning.
Though Giordano has been the first mover in the value-for-money casual apparel segment in Asia, there have been many who have challenged Giordano’s position and are competing head on against the brand. As Giordano operates in multiple segments, it directly or indirectly competes against many players. Bossini, Hang Ten, Esprit, G2000 and Gap are some of the more well known competitors.
Bossini and Hang Ten are the direct competitors for the core Giordano brand. These two players with similar positioning and product portfolios have been targeting similar customer segments. But Giordano with its emphasis on friendly service and higher quality has been able to maintain its edge.
Esprit with its fashionable and more edgy image is positioned higher than the core Giordano brand. With its appealing advertisements, and an international image, Esprit poses a threat to the Giordano Ladies brand.
Sustaining innovation and quality: Till today, Giordano has been able to sustain the levels of innovation along with quality that it has come to be known for. But given Giordano’s expansion plans within and beyond Asia, there will be a severe pressure on resources. Moreover, with many Asian countries including China and India allowing more foreign investment in the textile and retail industry, it is only a matter of time before the competition intensifies even more. Given these changing market dynamics, it would be a challenge for the brand to sustain its current advantages.
Establishing a clear positioning: Giordano has been consistent in its value-for-money positioning since its inception. But with sub-brands like Giordano Ladies and Bluestar Exchange catering to distinctly different market segments, it would be worthwhile for Giordano to re-examine its overall positioning. As the core Giordano and Giordano Junior brands still contribute a huge bulk of the overall business, it should not jeopardize the overall positioning and wander into different directions.
Creating a strong brand personality: Apparel is probably the most visible of all things as people wear them. This makes it the best product category to build resonating and exciting brand personalities as the merchandise can be used powerfully by the customers to express their identities. Traditionally Giordano has been emphasizing more on functional attributes of quality, value and design. But with the upward positioning of the entire Giordano portfolio being planned, Giordano should develop a more emotional and personality based positioning to compete against the likes of Gap and Esprit.
Expansion plans: One of the main advantages of Giordano has been its deep understanding of the Asian market dynamics and customer mindsets. As it plans to expand in India, Russia, North America and European markets, it will find it difficult to gain a firm foothold as each of these markets are culturally unique and pose distinct challenges. Giordano should counter this by establishing strong relationships with local distribution networks and by recruiting local people who have a good command over the local market dynamics.
Print ed: 05/10