End Term Jury

Market Research Report on United Colors of Benetton

Submitted to
Dr. Santosh Tarai

And

Ms. Harsha Rani

Submitted by:
Sanskriti Bhakuni

Department of Fashion Management Studies (FMS)

National Institute of Fashion Technology (NIFT)
(Ministry of Textiles, Govt. of India)

NIFT Campus, IDCO Plot No-24,

Bhubaneswar, Odisha-751024.
www.nift.ac.in

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 Table of Contents

Sr no. Topic Page no

1. CHAPTER 1 2

1.1 INTRODUCTION
2. 1.2 STATEMENT OF PROBLEM 8

3. 1.3 OBJECTIVE OF THE STUDY 9

4. 1.4 SCOPE 9

5. 1.5 METHODOLOGY 9

6. 1.6 RESEARCH DESIGN 10

7. 1.7 SAMPLE DESIGN 10

8. 1.8 LIMITATIONS 10

9. CHAPTER 2 11

2.1 LITERATURE REVIEW:

10. 2.2 MARKETING MIX OF UNITED COLORS OF 20
BENETTON
11. CHAPTER 3 29

3.1 EMPIRICAL DATA ANALYSIS

12. 3.2 STRATEGIES SUGGESTED 40

13. CHAPTER 4 41

FINDINGS & CONCLUSION

14. BIBLIOGRAPHY 42

15. APPENDIX 43
QUESTIONNAIRE
16. PHYSICAL EVIDENCE 45

17. PEOPLE 46

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 CHAPTER 1

1.1 INTRODUCTION

United Colors of Benetton is a well-known Italian fashion brand being present in 120 countries
worldwide with over 6,500 stores. The company was founded by Benetton family in 1965 in
Treviso, Italy. Benetton clothing has a strong Italian character in various styles and designs. The
company produces over 110 million garments every year, 90% of which is manufactured in
Europe. The total turnover is over 2 billion euro each year. Benetton is famous for its shocking
advertising where it is uses provocative images as technique to raise public awareness of social
issues such as peace, racial integration and AIDS. These advertisements brought much criticism
and caused damage to the brand image, however, it developed a distinctive identity. This report
will analyze and investigate whether there is an opportunity within the market to build a new
distinctive company image.

This report intends to professionally analyze and evaluate the United Colors of Benetton brand
current reality, management activities, marketing strategies and competition. Within this report
there will be data, communication strategies and facts regarding the Benetton brand and what is
their current brand identity. The aim of the report is to investigate if there are any opportunities
for the brand to develop a new unique brand image by creating a billboard, for the purpose of
increasing brand awareness from the different perspective, hence boosting sales margins.

Finally, the context of this report will also assess the market research, by means of examining
the brand’s current situation within the market; consider their main competitors and comparing
their communication techniques implemented to Benetton methods used to deliver message to
the customers.

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1.1.1 HISTORY AND HERITAGE OF UNITED COLORS OF BENETTON

United Colors of Benetton is an Italian clothing brand based in Triviso, which was founded in
1965 by Luciano Benetton. The name of the company comes from the Benetton family. The
company has integrated distinctiveness including colors, genuine fashion, quality at reasonable
prices and passion for its work. To attract a fast growing youth market, the company decided to
make the sweaters in bold, bright and enjoyable colors. To cooperate with this new image, the
company had changed the name from ‘Benetton’ to ‘United Colors of Benetton’. It moves at the
world’s speed, overcoming geographical, political and ideological limitations. Nowadays
Benetton is one of the most famous fashion companies in the world. In 1978 Benetton was
reorganized as a limited liability company and in 1986 they took on the name Benetton Group.
Before June 1986, the company was entirely owned by the Benetton’s family. The Benetton
Group head office is located in Villa Minelli, Ponzano, which is 30 kilometers from Venice.
Villa Minelli is a complex of 16th century buildings of great historical and cultural interest. They
have purchased this complex in 1969 and renovated it; the renovation process took over fifteen
years to finish. From the mid 1980’s, Villa Minelli has been the Group’s base and the spirit
centre of its business activities. (Benetton 2013) Benetton’s apparel business includes 5 brands:

1. UCB- flagship brand

2. Sisley- the trendiest brand
3. The Hip Site- the newest group brand
4. Killer Loop- sportswear
5. Playlife- sportswear

At the moment they have over 6,500 stores in 120 different countries. Benetton is Europe’s
largest clothing manufacturer and the world’s largest buyer of wool in the garment sector and
they have 9 factories in different parts of the world and an- annual revenue of 2.0 billion Euros in
retail sales. Alessandro Benetton has been Chairman of the Benetton Group since April 2012 and
is now guiding the company into their next stage of development.

1.1.2 CORE VALUES OF UNITED COLORS OF BENETTON

Benetton’s core values are being a globally responsible and a concerned company in social,
environmental and economic terms. They are committed for present and future generations,

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growing together with society in which the company operates, in Italy and all other markets.
Benetton is friendly to human dignity and to the change of society. All this creates their
company’s values and aims to grow by making a contribution into a progress of a developing
market. In the beginning, the company started with the advertising strategy which was based on
picture of young people who are of different skin types, color, and race wearing colorful
clothing. They tried to convey that there is no difference between skin colors; everyone is equal.
Benetton’s aim was to show their tolerance to cultural diversities. The denotative sign of this
image is eight people wearing colorful clothing who belong to different races. The connotative
here is ‘diversity’, ‘multiculturalism’, ‘equality’, ‘political’ and ‘social’ change. Nevertheless,
later, Benetton changed their advertising strategy. They started to design advertisements showing
the world’s biggest issues; war, Aids and other social problems. These advertisements were
shocking and controversial which was a source of negativity coming from the public’s side.
Benetton tried to make exciting emotions but developed (raised) the opposite feeling in people.
(BBC 2011) In the picture is the pope kissing Imam Ahmed el Tayyeb, from Benetton’s ‘Unhate’
campaign. There are two main signifiers who are the heads of two religions. They were connoted
with the idea of power, representation of their country or religion and that they signify
‘opposition’. Benetton putting them on the same image related to inducing the concept of
cultural, political or national barriers.

Opposite leaders into a kiss what means ‘sign of love’, ‘intimacy’, ‘trust’ and in this context
‘peace’. It was the most controversial and inappropriate of advertisements, compared previous
campaigns. This campaign caused a lot of disapproval and enmity. The Vatican protested and
next day it was removed; they found it unacceptable and disrespectful. Besides of all the
negativity, Benetton’s aim to attract attention was attained. People talked about it and discussed
the advert for a long time. However, now, Benetton in people’s minds is a brand with shocking
advertisements and forgotten its reputation for its colorful, high quality clothing. United Colors
of Benetton Brand Identity Externalization identifies what Benetton is to the outside world it
interacts with: Physique: colors, individuality, shocking ads, controversies Relationship: unity,
equality, friendship Reflection: multicultural, exciting, unconventional, modern, independent
minded Internalization identifies Benetton image internally: Personality: innovative, rebellious,
daring, provoking, full of energy Culture: Italian, quality, tolerance, brotherhood, awareness Self
image: feel good, extrovert, comfortable, vibrant.

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1.1.3 ITS BRANDS

Benetton, the Italian retailer was engaged in the manufacturing and distribution of clothing,
undergarments, shoes, cosmetics and accessories. Benetton also licensed its brand name to
various manufacturers of sunglasses, stationery, cosmetics, linens, watches, toys, steering
wheels, golf equipment, designer condoms and luggage. The group’s important brands included
United Colors of Benetton (UCB), Undercolors of Benetton, Sisley, and PlayLife.

I. UNITED COLORS OF BENETTON

United Colors of Benetton, the iconic Group's global brand, and one of the most well known in
the world, has an international style that combines color, energy and comfort. All these key
elements find their expression in the brand's core value: Passion 72 for Quality, with a strong
commitment to comfort and style. Each season the womenswear, menswear, childrens-wear and
underwear collections offer a total look for everyday, for work and for leisure, in the city and
outdoors. The Benetton Baby label is a new product line dedicated to the prenatal and the under-
fives world. The brand is present in many other sectors, from the elegant accessories to the
eyewear lines and perfumes, from the home collection to baby products. The above products are
available in selected specialized shops worldwide. UCB woman collection is both for women
who work and demand an easy and elegant wardrobe and those who want to create alternative
looks with a mix&match style. UCB man collection is a blend of elegance and originality,
completely in tune with the mood of the brand.

II. UCB KIDS

Collection segments different categories:

 New born (0-1 year), targets the smallest consumers, proposing fun and taking
inspiration from a the adult wardrobe, all with a constant attention to typical infant
characteristic;
 Toddler (1-5 years), offers a touch of glamour in comfortable, cosy and resilient items
for tomorrow’s adults;
 Kids & Young (6-12 years), proposes ideas for the pre-teenagers, very demanding when
it comes to fashion and fit. The collections are completed by mothers-to-be line, with
comfortable, soft, easy and unique clothes, meeting future mothers’ requirements
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 throughout the day. Even in the difficult 2009 UCB Children improved its performance
by 1.4% and celebrated forty years of business with a major event in Rome. Sales of
UCB Children have almost doubled in the past ten years, with the brand exceeding 30%
of the Group's turnover in 2009. Thanks to this constant growth the brand is no longer
perceived as an extension of UCB Adult, but rather as a specialized brand which has
satisfied customer demands and won their loyalty. Year after year, the focus has been on
segmenting the offer, knowing that children have different demands according to their
age group, and on designing the collections in a consistent fashion.

III. UNDERCOLORS OF BENETTON

Undercolors of Benetton is an extension of the Benetton brand, featuring underwear, beachwear

and sleepwear collections, as well as accessories for women, men and children. A wide selection
of recurring basic colors is enriched every season with the latest trends. Undercolors is available
in its own chain of stores which now has more than 500 locations in thirty countries and in
selected Benetton Shops.

IV. SISLEY

The encounter with Benetton occurred in 1974, when the Group, perceiving the potential, bought
exclusive rights to use the name, but it was not until 1985 that Sisley took on its own personality
within the Group. This is the Group's most fashion forward brand. Sisley presents elegant and
seductive collections, with special attention given to the choice of design, fabrics and new
shapes. Its creative artists and independent sales teams concentrate their efforts on its image and
on strong-impact advertising campaigns. The brand has created the very fashionable Sisley
Young line for children from 8 to 12 years old.

V. SYSLEY YOUNG

Is a sophisticated, detailed and rich collection inspired by the looks of up-to-the minute fashions,
styled to suit younger crowed. Available for children from 3 to 12, but concentrating on the 8-12
age group, it plays on sensations, emotions and creativity, all of which are reworked, filtered and
adjusted to the young age of our very modern little women and men.

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VI. PLAYLIFE

Playlife is the Benetton leisurewear brand that redefines a style. With its clean and elegant
collections Playlife blends an exclusive exploration of styles and allusions and a strong sense of
individuality. Playlife is a laboratory of new styles and brands which are flexible and embrace
total interpretative freedom, offering romantic, sporty and relaxed chic styles for both men and
women. This applies both to him and her, as both are given the opportunity to use their fantasy
and creativity to develop an increasingly more personal style. The strengthening of the
commercial network in recent years, particularly in Mediterranean Europe, has helped to sustain
turnover. The brand’s new store concept reflects the same values, highlighting their emotional
content.

1.2 STATEMENT OF PROBLEM

Advertisements were always blamed for manipulation and for creation of false needs focusing on
increasing consumerism and less focus on social problems.

Opinions on shocking ads are highly divergent. Some people approve shock advertising due to
its eye opening effect and the highlighting of the real social issues globally, while others believe
that shock advertising relies heavily on emotional manipulation and companies gain using social
issues commercialization in their own favor. United Colors of Benetton uses shock advertising
strategies to gather the attention of their desired consumers and gain popularity. But there is a
challenge in communicating the right message to the target customers.

With the changing demographics, many brands do not completely understand its marketing mix
and target segments. It is very important how a brand positions itself in the minds of the
consumers.

Keeping the main three expertise areas of Benetton in consideration that are: Knitwear, color
innovation and social commitment, it is hard for the brand to keep up with the new trends
changing in a fast pace and new competitors entering into the market with alike product offerings
in affordable prices.

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1.3 OBJECTIVE OF THE STUDY

Objectives of a research study are the route map which tells one in which direction to move in.
Any research would be meaningless if has no set objectives. Thus, for our research, the
objectives would be as follows:

 To understand the perceptions and attitude of consumers towards UCB products.

 To study respondents’ awareness towards UCB products
 Give the existing marketing mix of the brand and suggest some strategies.

1.4 SCOPE

The study can be used to get a comprehensive view of consumers’ attitude and awareness
towards United Colors of Benetton.

India is one of the top five markets by revenue for Benetton outside Italy. It sells a variety of
apparel, shoes and accessories for men, women and children through two key brands—United
Colors of Benetton and Undercolors of Benetton.

It currently supports the education of over 115,000 underprivileged girl children across India and
has won many awards for the same.

With a strong leadership and a dedicated workforce, the company has been growing at a 15%
compound annual growth rate for the last five years. Benetton India is targeting Rs1, 900 crore in
revenue with footwear, inner-wear and active wear being the key growth drivers. The firm also
plans to add 75 new outlets by 2020.

1.5 METHODOLOGY

 Primary data: Questionnaire

- Google forms
 Secondary data:
- Internet

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 - Company Reports and Brochures
- Magazines
- Newspapers Articles and journals

We will collect the data by drafting a questionnaire and thereby interpreting and analyzing the
result.

1.6 RESEARCH DESIGN

The research study is conducted as a QUALITATIVE METHOD for research, that is,
EXPLORATORY RESEARCH survey to collect the primary and secondary data.

We will collect our data by drafting a questionnaire and thereby interpreting/analyzing the result
by using SPSS and applying various tests such as chi-square test, Z test, T test and measures of
dispersion such as mean, median, mode, standard deviation etc.

1.7 SAMPLE DESIGN

A Probability Sampling Method (Stratified Sampling) has been selected from a population of the
cities- Bangalore, Bhubaneswar and Haldwani. The selection is purely random among females
and males with a sample size of 162. The respondents will be personally contacted for the
purpose of the survey. A questionnaire will be developed and used for making the survey. It will
be made sure that the respondents will include students, working class and homemakers.

1.8 LIMITATIONS

An underlying assumption of the entire project is that the details and feedback received from the
population is true.

The respondents are majorly from the age group of 18-29.

Susceptibility of the results to misuse.

There is typically a great deal of ambiguity in the results of qualitative methods.

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 CHAPTER 2

2.1 LITERATURE REVIEW

The culture plays an important role in influencing consumers’ responses toward offensive
advertising. Among the cultural values analyzed, the concept of high/low-context cultures and
the concept of individualism/collectivism seem to be most promising for explaining reactions
toward offensive advertising in a cross-cultural setting. Generally speaking, consumers from
high-context and collective cultures are more critical of sexually oriented products and
advertising appeals, as well as advertisements of products that may have negative social impacts.
Consumers from low context and individualistic cultures are more accepting of sexually oriented
products and advertising appeals, as well as advertisements believed to be bad for society.

Shockvertising composed of the words shock and advertising is a term referring to the use of
provocative, controversial, disturbing or explicit content in order to attract the consumer's
attention in the clutter of competition. Advertisers hope to sell their products by horrifying,
terrifying, offensive, repulsive, taboo and emotion-provoking images, and evoking feelings
among consumers. This type of advertising is used to sensitize people to religion, racism, war,
poverty and other taboo topics.

In the words of Mohamed Rafique Bin Ramlan for the United Colors of Benetton controversial
advertising campaigns: The need to effectively sell to consumers throughout many cultures
across world borders compelled businesses to tailor their advertising strategies to appeal to
different geographic markets. The United Colors of Benetton however, has been employing the
opposite strategy by trying to impart a single, what the brand perceived to be universally
accepted message that would generate positive responses from all consumers regardless of their
geographical, sociological, psychological, cultural, and economical make-up. Ironically,
historically speaking, the brand’s campaigns, which had a reputation of being controversial
despite claimed as an effort to promote universally positive values have consistently sparked
negative responses from their audiences.

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In 1980s, acclaimed photographer Olivero Toscani captured the image for the brand’s notorious
campaign, which the brand claimed to be an effort to raise awareness on social issues pertaining
to race and effectively promote the value of racial integration (Elliot, 1991). The print ad for the
campaign portrayed a depiction of a white skinned girl innocently posing side-by-side with a
black skinned girl. At face value, this print ad seemed to be just another print ad promoting
multi-racial value.

In the 1990s, the controversy ignited by the brand’s shocking campaign intensified. The brand’s
shift in focus towards more gritty social issues ranging from dying AIDS patient to image of
blood-smeared clothes (Mezzofiore, 2011) faced not only negative reaction from audiences, but
sparked public protests and banned by many governments across the world. The print ad which
depicted the blood-smeared clothes of a dead Croatian soldier was intended as a part of a
campaign that promotes anti-war effort (Associated Press, 1994). In this case, the intended
meaning of the campaign was within ‘the oppositional position’ when channeled through a
medium ready to be perceived by its audiences. One of the prevailing philosophy of the brand’s
advertising strategy was that ‘there are no shocking pictures, only shocking reality’ which
reflected the brand’s effort to expose realities that people refuse to see and face. The brand’s
campaign strategy relied on the assumption that the value that it is promoting through this
campaign is universally positive, and that it is immune to any interpretations (whether or not they
are misleading) formed by the audiences on the basis of their overall make-up.

After consistently recorded low sales, presumably due to a string of high-profile yet unpopular
ad campaigns (Maguire, 2003), the brand finally employed a drastically different advertising
strategy with its ‘Unemployee of the Year’ campaign in 2012 that addressed the issue of youth
unemployment. The campaign was also a contest in which unemployed youths could win euro
5,000 that they would use to implement a project that would create a positive impact on their
community (Lidbury, 2012). The campaign featured a series of thematically focused print ads
which depicted close-ups of youths paired with captions such as “Valentina, 30, non-lawyer from
Italy”. The brand campaign “presents a realistic portrait of today’s society by actively tackling a
current problem, that of youth non-employment and the potential conflict between generations,
in order to show it in a new light and create value for the immense human capital of young
people.”

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About the WE Program of Benetton Group:

The WE Program (Women Empowerment Program) is a long-term, Benetton Group

sustainability initiative aimed at supporting the empowerment of women worldwide.

To fulfill the goal of gender equality and women empowerment, Benetton Group has identified
five key priorities in accordance with the UN agenda:

Sustainable livelihood: ensure that women have access to decent work in safe places so that they
may gain social and economic independence.

Non-discrimination and equal opportunities: all forms of discrimination must be ended. Women
and girls must be granted equal opportunities with men and boys in employment, leadership and
decision-making at all levels. They must play a role in peace building and state-building and
have full access to information and communications.

Quality education: all girls and women must be granted access to affordable and quality
education at all levels, including technical, vocational and university education.

Healthcare: women and girls must be granted access to affordable and adequate healthcare. In
particular they must be granted universal access to sexual and reproductive health and
reproductive rights.

Fight against violence: by 2030, all forms of violence against all women and girls in the public
and private spheres must be eliminated. This includes trafficking, sexual and other types of
exploitation and harmful practices such as genital mutilation and child marriage.

2.1.1 CONSUMER OVERVIEW

Consumers are the base of the business of the business organizations. All the consumers are not
similar with each other according to their perception and behavior. In the words of Foxall (1998),
Consumer buying behavior is the study of intrinsic qualities of consumers, such as, motivators,
perceptions, personality and learning patterns. There are many factors which influence the
perception of a human being and the buying process, which essentially begins from early
childhood, remains through the teen years and adult life also. The evaluation of perception

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comprises many factors to understand the psychology of consumers. These factors belong to
culture, values, family, society, feelings, thinking, attitude, personality, etc. These factors also
vary from consumer to consumer and shape their buying behavior.

It’s important to United Colors of Benetton to engage with young people. They know there is a
big change in consumer behavior. Nielsen figures show that 52% of consumers are ready to pay
more for a responsible brand in Italy. The brand believes in this. Young people and families play
a substantial part in this. Benetton is in many markets and states that it’s amazing to see growth
markets where young families are ready to act for a better future.

Levitt (1983) proposed that the global consumer market can be tapped by standardized
advertising messages. The rapid emergence and expansion of global media have helped speed up
the development of international advertising campaigns. Because of the speed of technology,
many advertisers rely on global campaigns in order to grasp the market a step before the
competitors (Kaplan, 1994). Advertisers are becoming more sensitive to how consumers from
different cultural and social backgrounds perceive these “standardized” messages. In the Asian
context, empirical studies found that sexist themes, fear, nudity and cultural insensitivity were
the most frequently cited reasons for finding advertisements offensive (Phau and Prendergast,
2001; Prendergast et al., 2002).

The existing consumers of UCB are educated and in full-time employment, so they have a
sufficient amount of money to spend every month on their desires. Their belief is by being equal
no matter what race or color the person is will help make this world much happier. A particular
favorite quote of consumers is expressed by Pablo Picasso: “Colors, like features, follow the
changes of the emotions.” (Brainquote 2013) Existing Benetton customers perhaps have
children, as Benetton offers a wide range of clothing for children which is colorful and bright
like the adults’ assortment. In their free time of work they love spending time with children and
doing different outdoor activities so they give a preference to casual wear which is comfortable.
Benetton is the shop where they find clothing for all family and this clothing makes them feel
good and comfortable.

Potential Benetton customers are students in full time education in their early twenties. Some of
them are in part-time employment to earn extra money for their every day needs. They love to

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express themselves when around their peers. Their belief is by being honest and it will help make
new friends and contacts which are important going through different life cycles. Their favorite
saying is: “Everyone shall love their neighbours as themselves.” In spite of their young age they
are self motivated and enthusiastic. Their dearest wish is after graduation to become
professionally organized and successful people. In their free time they like socialising and going
out with like-minded peers. They prefer listening to pop culture music like Rihanna, Beyonce,
Bruno Mars and Justin Timberlake. They are wearing clothing rich in colors so Benetton is the
place where they can enjoy the paradise of colors.

2.1.2 FINANCIAL DATA

The Group's revenues in 2009 amounted to 2,049 million compared with 2,128 million in the
comparative year, reporting a slight reduction of 3.7% partly due to:

- a different contribution from the collection mix, reflecting prudent consumer spending in the
market as a whole;

- an unfavorable trend in emerging country currencies against the Euro's exchange rate (15
million), particularly by the Korean won, Turkish lira, Russian ruble and Indian rupee;

- a net positive impact from the opening of directly operated stores.

In the last decade revenues fluctuate over two million euro except in 2004 when there was a
sharp decrease consolidating revenues of 1,686 million euro due by the sale of the sports
equipment business [completed during the first half of 2003] and by continuing unfavorable
trends in the principal foreign currency exchange rates.

The apparel segment reported 1,947 million in revenues from third parties, representing a
reduction of 87 million on 2008.

The textile segment increased its revenues from third parties by 8 million to 102 million, 8.2%
more than in the comparative year, benefiting from the new commercial initiatives already
started in 2008 which partially offset lower sales of wool yarn.

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Benetton produced 150 million items (garments and clothing accessories, such as footwear, bags,
belts, etc.). About half of the Benetton’s production was sold in the Italian market, Benetton sold
its products in 124 countries through 5800 mono-brand stores, 95% of which are in franchising.
In the beginning almost all Benetton production was sold on the domestic market and exports
became significant toward the end of the 70s with stores opened in France, Germany, United
Kingdom, Holland and Belgium. Between 1973 and 1979, the Benetton’s sales increased from
31 to 287 million Euros. Today, in a highly depressed economic environment, constant currency
revenues fell by just 3%, in 2009. The decrease in turnover on mature markets was limited to 5%
on a constant currency basis. In particular, the Group generally defended its performance in Italy,
where revenues contracted by just 4% and which continued to be its principal market accounting
for 48% of revenues. This is a good result, achieved thanks to the excellent level of collaboration
with the Group's agents and customers, by following a strategy that focuses on large stores in the
major cities, and a wide presence in other cities and secondary towns (over 2,500 stores) giving
deep market knowledge. The rest of continental Europe performed in line with the general sector
trend, accounting for 34% of revenues. Markets in the Iberian peninsula slowed, after being more
severely hit than others by the economic and financial crisis. In Asia, excellent results were
achieved on the Korean market with strong double-digit growth, consolidating 14% of revenues.

In 2002 there was a marked decrease of the indices of profitability due by the strategic decision
to focus Benetton’s activity on the core business of casual clothing and sportswear. This resulted
in an extensive reorganization of the sports equipment division, with the objective of bringing
the Nordica, Prince and Rollerblade brands to a substantial break-even and starting a program for
their disposal, duly completed in the early part of 2003. In numerical terms, the steep decrease in
turnover in the sports sector hurt the Group’s overall performance: total sales in 2002 amounted
to approximately 2.0 billion euro, down from 2.1 billion in 2001. The program for the disposal of
the sports equipment business resulted in the booking of extraordinary and non-recurring costs.
While these had a limited impact on financial flows, they were the main reason for the small loss
for the year of some 10 million euro.

2.1.3 KEY CHALLENGES

Doyle and Bridgewater have identified 3 dimensions in today’s marketing environment:-

Collapse of boundaries as a result of globalization. The boundaries set barriers to new entrants

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and limit competition in individual markets, but now these boundaries are crumbling and ‘buyers
and competitors no longer recognize geographic country limits.’

Rising customer expectations as a consequence of ‘increasing competition and global over

supply.’ Today consumers want greater value in terms of lower prices and higher quality as well
as solutions tailored to their individual needs.

Speed of change: ‘Unless a new car, toothpaste, computer or machine tool is perceived to be
“new” and the “latest thing,” consumers lose interest. Continual, incremental innovation has
become essential to preserve market share and profit margins. These are challenges Benetton has
to cope with, and the extent of its success will be analyzed further.

Competitive Forces: The major competitors of the Benetton Group are Inditex (Zara), a Spanish-
based designer and retailer with 6 fashion chains and over 1,200stores world-wide; The Gap, an
international $ 11 billion (US) company and H&M, a Swedish company boasting about $ 6
billion (CDN) in sales. Today, the UCB brand is present in 120 countries while the likes of Zara
and H&M are in not more than 30 countries. However, this wide presence is difficult to control
and might increase inefficiencies. The company plans to do a clear analysis per region and to
decide where to invest or divest, if the return is not sufficient to justify the brand’s presence.

2.1.4 COMPETITORS ANALYSIS

At the moment, United Colors of Benetton is currently in 120 countries while brands like Zara
and H&M are not in more than in 30 countries. It is clear, that Benetton has dominance and great
potential over its competitors to be globally recognizable. However, to stay competitive in the
market Benetton it has to implement different marketing strategies to increase awareness of the
brand.

ZARA: The fashion brand Zara has a unique marketing strategy. Zara’s expenditure on
promotion is about 0.3% of their revenue. Based on this information, this could be the reason
that Zara does not appear on television or poster advertisements. (Chan 2011) Zara’s main
centers of attention in terms of promotion are:

Product- Zara never places their brand or logo on the products, very rarely promotes store sales.

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Place- Zara’s stores are always located in the epicenter of retail.

Price- Zara’s innovative products at affordable pricing is the key that keeps customers returning
to their store.

Product and Price: For the people who are fashion aware Zara lights up hopes and dreams as they
are making lines inspired by the latest catwalk shows. Zara are designing clothing ranges
keeping up with the latest trends which are sold at reasonable prices. Moreover, their new stocks
get delivered to stores in less than 15 days. Zara’s Fall ‘13 lingerie style dress; Zara amazingly
redesigns the most luxurious garments presented in the catwalk shows. This style of dress
represents sexuality, attractiveness and lack of restrictions.

Place: Zara’s store locations and window layouts are their biggest form of advertising. They also
spend a lot of time designing window layouts in an artistic and attention catching manner. From
personal observations made displays will never be seen for more than two weeks in the same
windows. This window display denotes the clothing range and connotative meaning is stylish,
trendy and mysterious.

Zara’s product life cycles is the main marketing tool to communicate with their customers, for
example, all their stores are located in the heart of retail for making marketing visible. Today,
customers know that every visit will be different and with new stock to choose from. Their
products seemingly advertise themselves as they represent the latest catwalk show’s styles.
Benetton would benefit if they would locate their stores on the busiest High Streets across the
country. As Benetton’s potential customers are students and they will raise brand awareness,
hence popularity by presence in the cities with universities. Zara’s strategy is designing clothing
which is copied from the catwalk shows making them a successful brand. If Benetton will try to
follow the latest fashion trends and show them in their range, they could gain recognition from
potential customers and return the loyalty of past customers.

Esprit: Esprit uses various advertising tools to communicate their brand message. The
advertising campaigns they use:

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Billboards and bus shelters. Every Esprit Campaign is implemented with extra carefulness. The
campaign is always supported by powerful images and a comprehensive communication
strategy, they are very eye-catching.

Print campaigns- another tool of communication which are presented in magazines such as Elle,
Glamour, InStyle, Grazia and Cosmopolitan. Esprit through these campaigns is trying to focus on
the key products and interpret them in a very creative way; it catches attention, therefore attracts
existing and potential customers to buy products. Esprit Womenswear Summer 2013 Print
campaign for Glamour magazine incorporated an ocean on the background shows independence
and freedom and it is demonstrated in the model’s look-in the way she is posing for the camera.
Also the model is wearing pastel color clothing that represents calm mood and readiness for the
time to relax.

The most recent Esprit campaign was ‘Skye Photography and Installation’ by Astrid Munoz who
is a model and photographer. It was a special event which took place September 27, 2013 in
Paris. Esprit together with Astrid Munoz invited guests to get on an exceptional journey to the
Esprit Fall/Winter 2013 campaign place, the Scottish Isle of Skye. This campaign was presented
through photography, multimedia installation, video projections, and sound effects of various
picturesque Scottish places. Esprit is a fashion brand and if the picture of the campaign would be
interpreted as a woman and her personality then the writer would say that the green and dark
colors, small water waves with a small amount of lightning give the feeling of a woman who is
self- confident, talented, adoring and naturally elegant. The Scottish landscape photo leaves an
impression of mystery and creativity; a great and surprising choice to engage customers.

Esprit also uses top models for their campaigns, for instance top models Erin Wasson, Coco,
Missy, Du, Anne V, Gisele Bundchen and Cathrine McNeil. Erin Wasson gives a feeling of a
lady temptation whether Cathrine McNeil represents deception and assurance.

Esprit uses various marketing strategies to engage customers; from advertising on bus shelters to
the use of top models in their advertising campaigns. Using celebrities to advertise their clothing
has a huge impact on customers’ buying behavior as it also attracts their attention. Esprit put all
their energy on advertising their clothing and design on very well presented billboards.

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2.2 MARKETING MIX OF UNITED COLORS OF BENETTON

2.2.1 PRODUCT

Back in the 80’s when Benetton launched its new product line, based then only on clothing and
accessories, under the brand name United Colors of Benetton nobody knew how much this will
grow. Today United Colors of Benetton is one of the best known world brands, with daring
campaigns and new, innovative and high quality products this brand stayed in the top for more
than twenty years. Anything done under this brand proved to be successful from the start. The
mix of products made under the brand name United Colors of Benetton include the consumer
products as brightly colored clothing lines, accessories, shoes, baby clothing lines, each
collection with its own personality adapted for a larger consumer scale as possible.

The organizational products include licenses and franchising. The UCB products designed for
young people of all ages, colors, nationalities, with the desire to have more color in their life. As
a ‘clothing services company’ Benetton through United Colors of Benetton stated that no one
was excluded from their targeted consumers, united meaning just that. This multiracial theme
was repeated in succeeding years with the slogan ‘United Colors of Benetton’, a slogan so
successful that it became the trademark of the company. United Colors of Benetton is rich with
meaning; it suggests, among other things, the United States, united races, a united Europe and a
united world. This is consistent with the philosophy of the company, which is truly global and
generates the majority of its revenues and profits outside Italy. The creative department of UCB
is made entirely of young graduates from art schools all over the world, 200 young designers
create more and more new colorful and diversified products, maintaining like this UCB as one of
the world’s most successful brands. But still after the departure of Oliviero Toscani in 2000 the
brand maintained the same success as ever.

What makes UCB products different from all others is their high quality, starting from the raw
material that at the beginning was mostly virgin wool (in the 80’s the main products of UCB
were knitwear, today only 35% of sales) and today also pure cotton, then the high quality of the
production process, finishing with a high quality product. With constant commitment to
innovation, very important for development, Benetton has the newest technology in domain,
starting with computerized high-tech cutting and packing plant for jeans and jackets at Ponzano,

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developed software for machine-knitted seamless sweaters that require no hand finishing ready
in half an hour, dyeing vats operational 24 hours a day, all this ensuring the high quality of the
products with which UCB accustomed its buyers. The main UCB customer products are clothing
with no boundaries, no rules full of bright colors inspired by the young spirit of the customers.

From the casual to the formal to the sporty all these tastes are combined in each of the UCB
collections. Still in all collections knitwear plays an important role not only for sweaters, jackets,
and cardigans, but also for dresses, coats or even trousers. Each adult collection is differentiated
for all type of customers, for weekend people, campus people, street people and evening people,
for each type of personality. Each clothing collection is accompanied by an accessories
collection to complete each look with a great range of accessories. From hats, flat caps, berets
and gloves in various patterns and materials as wool, tweed, and needle cord. Accessories also
include scarves, plain or stripy with flower patterns or not from silk or wool for autumn or
winter. Trendy bags, belts from natural leather, or tweed can’t be missing from any outfit.

With the developing of the market UCB extended also its view over its younger customers and
developed lines for children, from diapers and strollers to clothing for school children, sport
collections, winter and a punk collection to encourage children creativity. The choice can be
done from different looks from a multi-ethnic look with its faux Mongolia fur sheepskins and
jacquard knits, to camouflage or army prints each to represent the child personality. The new
babies’ products include skin care products, swimsuits, toys, and maternity underwear for every
mom and her baby. ‘More than just a diaper… Its an Italian designer garment,’ reads a Ledysan
sales presentation. The high-fashion brands Year 2000 Collection features diapers in vivid red,
orange, blue, green and yellow designs. Benetton’s latest creations brings its signature style and
colors to various products that range from Home Collection, kitchen accessories, terrycloth line,
to new toiletries line, perfumes and exclusive watches. The newest products launched on the
market are under the UCB licenses and are household products like rugs in bright eye- catching
colors, in abstract shapes, big patterns or plain colors, like all other products are of high quality
from cotton fiber weave for double-faced version, or hand-knotted in soft wool. This year the
UCB home collection included also candles of all shapes sizes and colors. The kitchen
accessories are from padded pot-holder, tea towel to apron and oven glove. All made from pure
cotton.

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One new collection is the B.clean line, with colorful toiletries not just for washing, with delicate
fragrance waters, creams that nourish the skin, exfoliating lotions.

A new inclusion in the product lines is the new ready-to-use colored paints and special effect
finishes for walls with a different and original look for each personality. From a great variety of
textures that include Metallic, Rag & Roll, Jeans and Cord, this gives a new and personalized
touch to each home.

The life cycle of the consumer products is of maxim two seasons due to the fact that all clothes
change with the season and along most of the accessories lines, this makes very important the
creation and development of new and variants products to maintain the position in the market.

The core product of Benetton is the clothing line that has a strong Italian character in design and
style. There is the recent development of product:

UCB men's collections:

United Colors of Benetton has consolidated the product range and expanded the assortment in its
men's collections, a segment that now accounts around 20% of UCB sales.

Sisley Limited Edition:

A new premium collection for men and women – under the new Sisley Limited Edition

Sisley Young:

It's product of young collection for 8-12 years old.

2.2.2 PLACE

Benetton outsources production in countries like Spain, Portugal, Tunisia, Croatia and Hungary.
In all these counties they have set up production poles which are partially or totally owned and
directly controlled by Benetton which coordinates the activities of group of SMEs in the
particular area.

Benetton is arguably the world’s largest retailer with a network of 6000 large stores, smaller
branches and franchises in 120 countries, worldwide.

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The Italian fashion firm, which entered the Indian market in 1992, operates 791 outlets in 181
cities in the country. From the very beginning, Benetton decided to maintain direct control of the
logistics phase and has invested heavily in automating logistics processes in order to achieve
total integration within the production cycle, from customer orders to packing and delivery. The
company distributes mainly through third-part independent retailers, but is currently developing
its own retail network. It generates 69% of sales in Europe, 9%in North America, 9% in Asia and
13% in the rest of the world. Italy is Benetton’s single largest market accounting for about 31.1%
of sales.

Benetton sees itself as a "clothing services company" rather than a retailer or a manufacturer. Its
customers are its shops, which are owned by outsiders. Benetton has head office near Treviso in
touch with customer tastes around the world. The new trend in the retail sector is to set up mega
stores with an average size of 1500 to 3000 square meters. The average size of Benetton store
was only 120 square meters and in order to overcome this difficulty Benetton decided to change
the commercial policy and increase the size of the retail outlets. They are increasing the size of
the existing retail outlets to display the whole range of Benetton products in the garment, shoe
and accessories segment. Wherever expansion is not possible the retail outlet will concentrate on
a particular product or segment. They have also opened up retail outlets in prime locations with
an average size of 500 to 2000 square meters.

Outsourcing decisions:

CAD/CAM design, cutting, knitting, dyeing which is highly technical and involves high capital:
do in-house.

Garment assembly, finishing which involves large labour force: outsource to subcontractors.

Raw material purchasing: do in-house.

Mass distribution where fast cycle times needed to meet customer expectations with minimal
inventories: do in-house.

Retail stores: involves high capital, labour oriented and requires high customer service levels:
outsource to licensees.

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2.2.3 PRICE

The company has an array of products and accessories within its brands hence a wide range of
pricing strategies are employed. The most important strategy though is the use of acceptable
pricing on its products. Some of the brands that target the youth will ideally be quite affordable
whereas some products are known to attract a premium pricing. Discounts are common hence
attracting more customers.

Benetton has had an uneven cash flow profile over last years with significant acquisition and
disposal activity. Taking cash from operations less working capital requirements, it deducts only
investments in tangible and intangible assets. A continuation of the relatively limited appeal of
Benetton’s merchandise combined with potentially weaker demand for clothing could lead third-
party retailers to demand more favorable payment terms. If Benetton’s management cannot
restore an element of “must have” and a sense of fashion to the brand, Benetton’s bargaining
power with the independent retail distributors could seriously weaken the company’s position.
Furthermore, the asset base to remain relatively high as a result of investments in the retail
infrastructure combined withan increase in working capital requirements. Benetton has a strong
competitive advantage in its supply chain, with flexible production and both a state-of-the-art
distribution centre and logistics. However, it is said that the supply chain is not optimally
leveraged: Benetton would be well positioned to produce fashion-forward merchandise (since
much of its production still takes place in-house and in Europe, close to its distribution network)
and could therefore respond relatively rapidly to fashion changes. However, the lack of direct
control over its distribution network (as most stores are run by franchised partners) makes it
difficult for Benetton to implement effectively the information flows and feedback loops needed
to sell merchandise with high fashion content and with the appropriate levels of risk.

2.2.4 PROMOTION

UCB is very fond of promoting a number of sporting events as well as for the provocative of its
original “United Colors” campaign for publicity. The “United Colors” publicity campaign was
coined when photographer Oliviero Toscani received the carte blanche from Benetton
management. Toscani directed the creation of advertisements that were characterized by striking

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images that weren’t related to the products marketed by the company. Such billboard-sized
graphic advertisements included depictions of an array of shocking subjects such as the deathbed
scene of an AIDS man. Though some of these adverts were controversial, association with
Benetton with Toscani has been credited for the increased promotion of the brand awareness.

Benetton does two types of campaigns — product-specific and corporate. The focus of each
campaign is different. While product-specific (campaign) highlights Benetton's collections and
are hence seasonal, corporate campaigns are generally undertaken once in 12-18 months and
showcase larger issues affecting the world. The latest corporate campaign, for instance, is on
food. The campaign has been created by Benetton in partnership with the World Food
Programme (WFP) to fight global hunger and famine.

An autumn 2011 communication campaign by Benetton to invite citizens and world leaders to
combat the “Culture of hatred” led to the creation of the UNHATE foundation. This was and still
is a social responsibility strategy with Benetton always doing its best to try and create the
UNHATE culture in humanity.

Benetton has been involved in a series of sports sponsorships. For instance, UCB entered the
Formula One in 1993 as a Tyrrell sponsor. In 194, it sponsored Alfa Romeo whereas, in 1985,
the company sponsored both Toleman and Alfa. The company also started the Benetton Formula
LTD towards the end of 1985 with the team seeing great success between 1990 and 1997.
Benetton is also credited for sponsoring a local rugby team A.S. Rugby Treviso. This amateur
rugby team later became Benetton Rugby team, which is a formidable force in Italian rugby with
11 league titles under its belt.

2.2.5 PEOPLE

Once the consumer steps into any of the UCB stores, the staffs in the store start to engage the
customers diligently. They greet them with a smile and invite them to see the goods available in
the store. People in the UCB outlets always make sure to keep the latest items in the stores, as
well as the most favorite ones. The salesperson informs the costumers about the good deals
provided by their store and how to get the maximum benefit out of it. Also the customers get to

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know about the current promotions from the store members. If any required product is not
available, the staff explains the reason of unavailability of the product to the customer. Also they
try their best to inform the customer readily once the good arrives. Whether or not the customers
need any help with browsing the goods, they cannot help but be pleased with the attention that
has been shown towards them by the staff members of UCB. The feeling of being welcomed and
being important to the store are the most basic needs a customer could demand. In all of the UCB
stores, the staff goes through soft skill training programs. Screening and qualifying of new
employees are critically done.

The company leverages technology to cut across the geographical boundaries to reach out to
people and focus on instant recognition. It has created an internal online platform called
‘Benetton Connect’ where employees are appreciated and their contribution is recognized.

Besides work, employees’ loyalty to the organization is also recognized and rewarded. Starting
from the completion of the first year, landmarks like three, five, 10, 15 and 25 years of service
are recognized and rewarded.

People are also involved in the e-commerce website that is provided by UCB. This includes the
people who bring the products to the customer through home delivery, who pick up the goods
from the customers in case of return. People in Customer services connect with the consumers
and query about any difficulties, take their feedback on the service provided by the organization.
The way in which a complaint is handled can cause a vital importance to the company. A
customer can be retained or lost improving or ruining the image and reputation of the company is
dependent on the people in customer care. So UCB has trained their staffs in such a manner that
people continue to return to it because of their effective customer service.

One of the most important stakeholders of any company is its customers. Without customers the
company cannot survive so in almost all situations the customer needs have to come first.

See appendix section 2.2 Marketing Mix of UCB

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2.2.6 PROCESS

Benetton Group is upgrading and expanding its e-commerce platforms with new online stores for
the Sisley and United Colors of Benetton brands.

Meanwhile, the Italian fashion brand has overhauled its www.benetton.com e-shop to offer
customers an increasingly immersive shopping experience. The renewed website is available in
seven languages in 24 countries, and features fresh graphics plus an easier browsing experience
even on mobile devices.

Its clean design, including a reorganized menu and improved search engine, follows an analysis
of buying behavior and interviews with consumers.

It marks a new phase in the company’s online strategy, as Benetton Group is taking over direct
management of the online channel.

United Colors of Benetton has revolutionized the concept of selling through several e-commerce
websites such as Amazon, Flipkart, Jabong, Myntra, TataCliq, etc.

They have an organized official web system to handle the showcasing of its products named
world.benetton.com. This site has all their collections and one can view easily what product from
which collection he/she has to try. The site also has a description for every collection it
showcases online so that it is easier for the customer to understand the brand’s story and the idea
behind it. It gives us an option to save the product in one’s wishlist to view it later. We can also
find the nearest store to our location with the help of the store locator option in the website.

Unlike the offline stores, when the user visits the homepage of the official website, they have an
early access to new product releases and newsletter subscription.

The e-commerce portals through which UCB sells its products, the shipping time and charges
varies for the product to get delivered after the confirmation of the order which is notified to the
customer through e-mail and SMS. One can return the product within a period of 30 days after
the product is received and for the refund, normally it takes 3-5 business days but it can take up
to 30 days for the refund to show from the time you ship it back to them. The customer also
receives a notification letting them know that the package has been received by their warehouse.

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They accept COD and support all major domestic and international credit cards, debit cards, e-
wallets and net-banking.

2.2.7 PHYSICAL EVIDENCE

United Colors of Benetton has introduced the new On Canvas store concept, the store that
transforms itself. ‘On Canvas’ is derived from the traditional concept of a loom. It serves as a
light, simple but solid and almost invisible structure, around which seasons, collections, colors
and materials are created. Symbolizing tradition and craftsmanship, and also emblematic of
innovation, the ‘loom’ enables all kinds of transformation within the store. Materials, canvases
and spaces alter and change, creating infinite solutions.

On Canvas has been applied to some stores in India at Phoenix Marketcity Bangalore and
Banjara Hills in Hyderabad.

On Canvas is a concept inspired by an artist's space. Materials like ageing metal with exposed
welding and joineries, steel, birch and teak wood and concrete have been carefully finished to
retain the natural feel. The store's colour palette has been kept neutral while elements like
exposed brick wall, bare unpainted concrete, exposed ceiling, exposed service ducts and systems,
wall papers etc contribute to the conscious effort not to conceal joints and surface imperfections.

To lessen carbon footprint, the store design uses energy efficient LED's that consumes up to 90%
lesser electricity is specially designed with 3000K color temperature providing unmatched depth
of color and texture to the displayed merchandises.

See appendix section 2.2 Marketing Mix of UCB.

28 | P a g e
 CHAPTER 3

3.1 EMPIRICAL DATA ANALYSIS

3.1.1 PRIMARY SURVEY ANALYSIS

 Demographics’ Age:

Sample size is 162 and the age groups of the customers who filled the survey are represented by
the below pie-chart.

The maximum number is in the age group of 18-29 that is 80.2%. This implies that the survey’s
result will be youth oriented.

16.7% of the respondents lie in 30-49 age group and the rest lies in the 50 or older age group.

 Brand Familiarity:

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Through the survey we analyzed that 93.2% of the respondents are familiar with the brand and
have heard about it. It means that the brand is well known.

The rest 6.8% of the respondents are not familiar of the brand.

 Brand association:

It is very important for a brand to position itself in the market and in the minds of its customers.

In the survey, people were asked what comes in their mind first when they hear the brand United
Colors of Benetton. Here from the survey we analyzed that brand has associated itself with three
major attributes shown in the pie chart below.

The outcome is that most of the respondents associated the brand with Clothing with 43.2%.

36.4% people associated the brand with Advertisements it does mainly on print media and
outdoors.

20.4% people associated the brand with colors as a means of recognition.

 Shop at Benetton:

58.6% of respondents still shop at Benetton and 41.4% of respondents do not shop at Benetton.

30 | P a g e
  Respondents usually shop for:
I. 53.5% : Topwear
II. 22.8% : Denim
III. 11.9% : Accessories
IV. 7.9% : Knitwear
V. 4% : Footwear

The majority people shop for Topwear and Denims and least they shop for footwear.

The brand’s expertise is in Knitwear but in the findings it indicates that knitwear holds second
position for the shoppers to shop for. Hence, with the emerging competition and demand for the
topwear, the brand focuses on topwear sales more than any other product.
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  Respondents on why they do not shop at Benetton:
I. 56.9% do not find the prices appropriate
II. 32.3% do not find the appropriate designs
III. 7.7% says services
IV. 3.1% says quality

 Brand Loyalty:
I. 26.5% of respondents are loyal to the brand
II. 73.5% of respondents are not loyal to the brand

Hence, most of the people are not loyal to the brand. This indicates that the brand is not doing
good in holding its current customers.

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  Other preferences:
I. 45.7% of respondents prefers H&M over Benetton
II. 28.7% : Zara
III. 20.2% : Marks & Spencer
IV. 5.3% : Esprit

 Suggestions to Benetton where they could work on to improve their brand image:
I. 39.1% of respondents say Benetton should work on its product range as Zara and H&M
are providing latest designs and follow trends.
II. 32.2% of respondents say it should revise its prices as its competitors are providing
affordable prices for the youth which it is targeting.
III. 14.8% of respondents say it should work on its controversial advertising concept
IV. 13.9% says the brand is lagging behind in following latest trends

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3.1.2 ADVANCED ANALYSIS

From the responses obtained through the survey, we did a cross tabulation of the respondents’
data on their Age group and how many of them shop at Benetton.

Table 1: Cross Tabulation between the age group of the respondents and who shops at
Benetton of those age groups.

Shop at UCB

Age Yes No Total

18-29 83 47 130

30-49 10 17 27

50 or older 2 3 5

Total 95 67 162

From the above table we analyzed that the majority shoppers of United Colors of Benetton are of
the age group 18-29. Out of the total respondents they form a major segment of the brand’s target
market that comes out to be 51.23%.

The 30-49 age group people buy less from Benetton. There are only 6.17% people of this age
group who buy from Benetton and 10% of this age group does not buy from Benetton.

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Table 2: Cross Tabulation between the age group of the respondents and the percentage of
the people who shop and do not shop at Benetton.

Age Total %
18-29 30-49 50 or older

% people shop at UCB 51.23457 6.17284 1.234568 58.64198

% people do not shop at UCB 29.01235 10.49383 1.851852 41.35802

It indicates that the people of age group 18-29 more shop at Benetton than the people of other
age groups.

Table 3: Cross tabulation of the age groups considered in the survey and what do they
usually shop for.

What do you
usually shop for?

Row Labels Topwear Knitwear Denim Footwear Accessories Grand Total

18-29 48 5 17 4 11 85

30-49 6 3 4 1 14

50 or older 2 2

Grand Total 54 8 23 4 12 101

The above table indicates that 18-29 and 30-49 age group of people usually shop for Topwear
then Denim.

Thus, the best sellers of Benetton are its topwear products and denims.

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 60

50

40

30 18-29
30-49
20
50 or older
10

Graph for Table 3

Table 4: Table of preferred brand to shop at, if not Benetton.

Shop at
If not Benetton, what other brand you prefer? UCB
Row Labels No Yes Grand Total
Zara 21 6 27
H&M 39 4 43
Esprit 5 5
Marks & Spencer 17 2 19
Grand Total 82 12 94

The above table indicates that people who do not shop at Benetton prefer to shop at other brands
like Zara and H&M.

Zara is offering a great range of products and designs to the customers.

It is into fast fashion, which means that it changes its products in a very short period of time to
keep the new trends into its collection so that the customers who are in search of new designs do
not get bored of it.

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 45

40

35

30

25 No

20 Yes
15

10

0
Zara H&M Espirit Marks & (blank)
Spencer

Graph for Table 4

Table 5: People shops at Benetton and if not, why?

If answered no to the previous question, why you

do not shop at Benetton?

Row Labels No Yes Grand Total

Designs 20 1 21

Price range 25 12 37

Services 5 5

Quality 2 2

Grand Total 52 13 65

The above cross tabulation data indicates that people who do not shop from Benetton stated Price
of the products as the major reason not to shop from the brand. Brands like Zara and H&M
provide affordable prices to the customers whereas Benetton’s price range for Indian youth is not
affordable.

Design is also one of the main reasons people do not shop at Benetton. The brand provides very
monotonous designs and that are not very trendy which today’s consumer wants.

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 In terms of quality and services, less people have voted against it. It indicates that the people
who are loyal to the brand are due to its product’s quality.

30

25

20

15 No
Yes
10

0
Designs Price range Services Quality (blank)

Graph for Table 5

Table 6: People who are aware of the brand associates it with the below three attributes.

What comes first to your mind when thinking about United

Colors of Benetton?

Row Labels No Yes Grand Total

Advertising 2 57 59

Clothing 3 67 70

Colors 6 27 33

Grand Total 11 151 162

The above table suggests that people who are aware of the brand can associate the brand with
three major attributes.

Most of them can associate the brand with its clothing.

Some of them associate Benetton with the advertisements.

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Some can associate it with Colors which the brand incorporates in its collection and the name.
80

70

60

50

40 No
Yes
30

20

10

0
Advertising Clothing Colors

Graph for Table 6

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3.2 STRATEGIES SUGGESTED

 Benetton should offer more designs of their products, should follow latest trends and be
up to date with the current fashion as its competitors like Zara and H&M do.
 Benetton should focus on creating and producing strongly differentiated products so that
these are perceived as different and high-end in the industry and will differentiate using
its product, service and image.
 Focus on small sectors of the market first and then the whole market.
 It should reduce the extent of shock advertising and work on the way it wants to
communicate with their customers.
 Should focus more on the product offering rather than just on the advertising the social
issues.
 Focus on retaining the current customers as well as the potential customers.
 Improve e-commerce channels to engage more with the customers as today many people
shop via online.
 Celebrity endorsements should be incorporated in promotions.

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 CHAPTER 4

FINDINGS & CONCLUSION

A survey was conducted for the research report on UCB with a sample size of 162 in the cities
Bhubaneswar, Haldwani and Bangalore. After analyzing the data we can say that out of the total
respondents the target customers of UCB are those of medium-high purchasing power. They
target youth who can bring about a change in the society that the brand wants to trigger them for.
The brand’s main objective is to create awareness about its social commitment and it wants the
individuals to stand up for the social issues it promotes through advertisements.

Those who are brand loyal are loyal due to the fine quality and good services it provides to its
customers. In India, many youngsters who are not earning cannot afford the Benetton products
due to its price range. The designs it offers are also not very attractive as per their price range.

Benetton in India is focusing on the young generation which is more active in the digital world.
Hence, it is increasing the reach on social media platform and extend its online selling platform
to more developing countries like India.

Benetton’s expertise is in knitwear, color innovation and social commitment. So it is necessary

for the brand to keep up with its diverse range of products and variety of colors along
introducing some new marketing strategies to increase the sales of its products as well as
focusing on exactly what the brand wants to communicate to its target customers so as to create a
true brand identity in the market.

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 BIBLIOGRAPHY

 Essays, UK. (November 2013). United Colors Of Benetton: The Cycle Of Reality.
Retrieved from https://www.ukessays.com/essays/marketing/united-colors-of-benetton-
the-cycle-of-reality-marketing-essay.php?vref=1
 Essays, UK. (November 2013). What Is Benetton Shock Advertising?. Retrieved from
https://www.ukessays.com/essays/media/what-is-benetton-shock-advertising-media-
essay.php?vref=1
 Benetton Group (June 2011). Social Commitment. Retrieved from
http://www.benettongroup.com/sustainability/benetton-social-commitment-programme/
 Essays, UK. (November 2013). The United Colors Of Benetton Clothing. Retrieved from
https://www.ukessays.com/essays/marketing/the-united-colors-of-benetton-
clothing.php?vref=1
 Marketing week.
https://www.marketingweek.com/2015/12/02/benetton-changes-its-colours/
 Zara’s marketing strategy:
https://www.marketing91.com/marketing-strategy-zara/
 Unemployee of the year campaign: Benetton Group. Retrieved from
http://www.benettongroup.com/media-press/press-releases-and-statements/united-colors-
benetton-launches-unemployee-year-new-global-communication-campaingn-to-support-
non-employed-youth/

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 APPENDIX

QUESTIONNAIRE

 Name
 Gender
 Occupation
 Which category below includes your age?
1. 18-29
2. 30-49
3. 50 or older
 Are you familiar with the brand 'United Colors of Benetton'?
1. Yes
2. No
 What comes first to your mind when thinking about United Colors of Benetton?
1. Clothing
2. Colors
3. Advertising
 Do you shop at united colors of Benetton?
1. Yes
2. No
 If answered yes to the previous question, what do you usually shop for at Benetton?
1. Topwear
2. Knitwear
3. Denim
4. Footwear
5. Accessories
 If answered no to the previous question, why you do not shop at Benetton?
1. Price range
2. Designs

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 3. Quality
4. Services
 Are you Brand loyal to Benetton?
1. Yes
2. No
 If not Benetton, what other brand you prefer?
1. Zara
2. H&M
3. Esprit
4. Marks & Spencer
 If there are any suggestions to Benetton how they could improve their brand image?
1. Yes
2. No
 If answered yes to the previous question, what could they work on?
1. Product offering
2. Advertising
3. Price range
4. Follow latest trends
 Will you recommend Benetton to others?
1. Yes
2. No

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2.2 MARKETING MIX OF UCB
2.2.7 PHYSICAL EVIDENCE

Benetton Denim shirt Benetton Bag with its logo on it

UCB On Canvas concept store in India.

Benetton Knitwear Benetton “Clothes for Human Campaign”

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e
2.2.5 PEOPLE

Share holders’ Data for Benetton

Source: Benetton Group Annual Report 2010

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Source: Benetton Group Annual Report 2010

Source: Benetton Group Annual Report 2010

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