Introduction
The stable functioning of any company depends on several factors that should be considered when selecting an effective strategy. Thus, achieving superior performance levels is a more challenging goal that presupposes the ability to generate a competitive advantage and use it to overcome rivals and attract clients’ attention. For modern, highly competitive markets, it presupposes the analysis of the environment and use of effective marketing strategies, elements of the marketing mix, and focus on specific clients. For instance, NEXT plc can be viewed as a successful British company that attained superior performance. Analysis of its current achievements and strategies will help understand the strategic decisions of the corporation and how it effectively utilized the existing trends to create offerings and products, meeting clients’ demands and increasing their loyalty.
Superior Performance
NEXT plc is a British multinational retailer of footwear, clothing, and home products headquartered in Enderby. It was founded in 1864 by Joseph Hepworth and experienced a fast rise due to the successful market entry (Our history, no date). Today, the brand has around 700 stores in different parts of the world, such as Europe, Asia, and the Middle East (Our history, no date). This factor evidences the corporation’s success and multiple opportunities for further rise. Moreover, Next’s annual report shows stable growth in total sales (+3.3% in 2020) and earnings per share (+5.6% in 2020) (NEXT, 2020). The company’s total revenue constitutes £4.3 billion, which is higher than in 2019 (£4.2 billion) (NEXT, 2020). These numbers evidence the brand’s superior position and its success during turbulent times. At the moment, Next is the largest clothing retailer in the UK, with such giants as Marks & Spencer behind (NEXT, 2020). The organization also has positive forecasts regarding its further growth and the ability to preserve leading positions.
Business Model and Marketing Concept
NEXT’s success is closely linked to the business model the company uses and the marketing concept it employs. The corporation formulates its goal in the following way “NEXT’s purpose is to offer beautifully designed, excellent quality clothing and homeware which are responsibly sourced and accessibly priced” (NEXT, 2020, p. 54). It means that the brand focuses on combining high-quality products with affordable prices, which results in its growing popularity among clients (NEXT, no date). NEXT has suppliers in India, Turkey, and Hong Kong controlled by a quality officer guaranteeing the desired condition of fabrics and clothes (Our suppliers, no date). This approach allows the firm to establish lower prices for high-quality products and benefit in the long term perspective. The brand tries to create a single robust aggregation business selling hundreds of third-party clothing, and other goods, such as home brands, along with NEXT branded products (NEXT, 2020). It contributes to increased sales and better client needs consideration.
Products and Sales
Another element of NEXT’s success is its approach to organizing sales and products offered to clients. The brand focuses on creating the positive experience of visiting its stores for clients to return and buy new products distributed by the brand. At the moment, NEXT opens customer-friendly stores with big and spacious areas for all individuals to enjoy positive feelings (NEXT, 2020). This approach is combined with selling high-quality clothes and homeware products which are functional, safe, and meet the current clients’ demands (NEXT, 2020). It preconditions the preservation of the high level of clients’ interest and contributes to the growing revenues. Moreover, NEXT has combined fashion and home stores, which becomes more convenient for people as they can buy everything they need not leaving the area (NEXT, 2020). This strategy is supported by the current business model and contributes to a better image and results.
Marketing Strategy
NEXT also has an effective marketing strategy helping the brand to evolve and generate stable revenues. First, the company demonstrates the correct understanding of its target market and how it can be influenced. It consists of middle-class individuals, both males, and females aged 25-45 years (NEXT, no date). They want to follow current trends and acquire high-quality and not expensive clothes that would help them to feel comfortable (NEXT, 2020). Communication with the target audience is aligned via Facebook, Twitter, Instagram, and mobile messaging to consumers (NEXT, 2020). They are informed about new arrivals, products waiting for them, and sales (NEXT, 2020). This marketing strategy helps to remain in touch with the audience and ensure it has data about the peculiarities of clothes, goods, and offerings provided by NEXT.
Marketing Environment
The company also benefits from the successful marketing environment, which serves as another success factor. NEXT focuses on specific markets in the UK and other areas, meaning that it depends on their conditions and changes. However, it is possible to forecast the preservation of the current tendencies presupposing the development of the clothes industry and it’s becoming more attractive for companies operating there (NEXT, 2020). The external environment can be analyzed using the PESTLE analysis tool:
- Political – NEXT benefits from the political stability in Europe and the UK and other regions where it functions. The legal framework for contract enforcement and sales also helps the company to protect its interests and remain a powerful actor at the international level.
- Economic – NEXT operates in countries with stable and growing economies. It means that people have a high or middle level of income and can afford products provided by the company (NEXT, 2020). Moreover, the interest and inflation rates in the UK and EU are appropriate, meaning that the company benefits from the stability in its central markets.
- Social – demographics and class structure are two other elements contributing to the development of NEXT and its leading positions. The strategically important regions consist of mainly middle-class representatives with a high buying capacity, entrepreneurial spirit, and the desire to follow popular trends in fashion (NEXT, 2021). It means that NEXT can benefit from these tendencies and increase its sales.
- Technological – recent technological developments in the retail sphere such as social commerce and the dominance of media as advertising tools can also be considered beneficial factors. NEXT can improve its cooperation with clients and enhance its supply chain by using the latest technologies and approaches.
- Legal – NEXT operates in regions with established legal systems and comprehensive customer and companies’ protection (NEXT, 2020). It means that the firm can feel safe and free to cooperate with customers as it is protected by existing regulations.
- Environmental – the brand emphasizes its focus on sustainable policies and corporate responsibility. It also cultivates recycling procedures and approaches within the company (NEXT, 2021). For this reason, it does not violate existing environmental laws and benefits from this factor.
Altogether, the application of the PESTLE analysis shows that NEXT operates in a highly favorable environment. It does not limit the company in its attempts to cooperate with clients and continue its evolution. Moreover, social, economic, and political aspects play an important role in promoting the firm’s success, and it’s becoming one of the central actors in the market.
Marketing Mix
The marketing mix is another critical aspect of the marketing plan vital to achieve the current purposes and create the basis for further growth. It includes the product, price, placement, and promotion as the four factors essential for building strategies (Kotler, Kartajaya and Setiawan, 2021). NEXT devotes much attention to all elements from the list, recognizing their importance for performance and sales. The company promotes its goods using innovative methods, such as social media and tries to ensure high quality, price, and appropriate placement. At the same time, because of the business model’s peculiarities and the need to attract clients, such aspects as price and product should be viewed as central ones because NEXT builds its strategy around them and reports the adherence to the principle of considerable price for good quality (NEXT, 2020). For this reason, these two elements should be investigated.
Product
The company’s purpose says that NEXT offers “beautifully designed, excellent quality clothing and homeware” to clients to meet their needs and ensure they will return (NEXT, 2020, p. 54). Under these conditions, the brand focuses on improving the qualities of its products and adding some features that might help to retain customers and preserve the high level of their interest in the brand. For instance, NEXT follows the current fashion trends to guarantee that all clothes are relevant and not outdated (NEXT, no date). It increases sales and guarantees that individuals will be satisfied with the pool of items available for them. NEXT will continue to focus on this element as part of its strategy guaranteeing stable income and the basis for new achievements.
Price
Price is another vital aspect of the marketing mix that is linked to the company’s success and its ability to compete with its closest rivals. As stated previously, NEXT emphasizes that its products have a moderate price combined with high quality. It means that clients with various income levels can afford clothes and homeware products distributed by the brand (NEXT, 2021). It is achieved by the wise selection of suppliers, partners and monitoring the procurements to avoid using materials with defects or products with inappropriate features of qualities. This method helps to regulate prices and ensure they are not too high for the target audience. Combining the product and price elements of the marketing mix, NEXT manages to improve its current position and attract new clients.
Conclusion
Altogether, NEXT is a successful company demonstrating superior performance and success in the UK market and globally. This progress is explained by the successful strategy, the effective marketing method, and the focus on the specific target audience with unique features. NEXT provides high-quality products with affordable prices and features appreciated by clients. It helps to generate stable benefits and create the basis for the future rise. At the same time, the unique business model and marketing concept with the focus on big shops and spacious areas help to increase clients’ interest and ensure they will remain satisfied with the items available to them. Employing this strategy, NEXT remains a leader in the market and has numerous opportunities for the further rise and entering new markets or areas.
References
Kotler, P., Kartajaya, H. and Setiawan, I. (2021) Marketing 5.0: technology for humanity. New York, NY: Wiley.
NEXT (no date) Business model. Web.
NEXT (2020) Annual report & accounts. Web.
NEXT (2021) Our approach to corporate responsibility. Web.
Our history (no date). Web.
Our suppliers (no date). Web.