PRIMARK MARKETING STRATEGY:

AN ANALYSIS

Image 1: NDebted, Applying Marketing in a Business

Mohammed Rohim
Reporting Consultant

Student Number: 1303501 MBA BEM 702: Marketing Management

CONTENTS:
1.0 Introduction 3
1.1 Primark: An Overview 4

2.0 Situational Analysis 5

2.1 The 3 Model analysis 6
2.2 Concluding the situational analysis 7

3.0 The Primark Strategy 9

3.1 Target Market and Segmentation 9
3.2 Competitive Positioning and Advantage 10

4.0 The Marketing Mix Discussion 11

4.1 Price 11
4.2 Place 11
4.3 Promotion 12
4.4 Product 12
4.5 Other Considerations 12

5.0 Corporate Social Responsibility: Who Profits? 14

6.0 Consultant Recommendations 16

7.0 Concluding Statement 18

8.0 Appendixes
8.1 Appendix 1: Marketing Consensus Map 19
8.2 Appendix 2: Product Life Cycle 20
8.3 Appendix 3: Boston, GE and Ansoffs Matrix 21
8.4 Appendix 4: CSR Triangle 22
8.5 Appendix 5: SWOT Analysis 23
8.6 Appendix 6: PESTEL Analysis 24
8.7 Appendix 7: Porters 5 Forces Analysis 26

9.0 References 27

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INTRODUCTION:

“The enigma of marketing is that it is one of

man’s oldest activities and yet it is regarded as
the most recent of business disciplines”
(Baker, 1976)

Marketing is a crucial element to the success of any business, especially in this modern era, though,
as Baker (1976) has suggested the application of marketing has been around since long before it was
recognised as a business function. Though there are differing definitions as to the purpose of the
marketing function in any business, leading thoughts in the industry stem around being able to
“maintain, develop and grow relationships with consumers with the aim to identify, anticipate and satisfy
customer requirements profitably” (Chartered Institute of Marketing, 2012) whilst other thought leaders
believe it is an ‘exchange of ideas, goods and services’ and Kotler and Armstrong (2010) believe it is
an exchange of values.

This report, therefore, has been compiled with the purpose to critically analyse and comment on the
strategies being implemented by Primark, a subsidiary company of Associated British Foods (ABF).
This report investigates and evaluates the strategies being adopted to effectively promote and
strengthen the clothing brand through marketing applications.

The focus of this report is to explore the decision-making processes, business environment, the
positioning and competitive advantage of one of the fastest growing retailers across Europe and as a
new market entrant to America.

The exploration of their current strengths and weaknesses, opportunities and threats as well as looking
at the internal and external business environment through a PESTEL analysis and Porters 5 forces will
be undertaken to ascertain the company position by using the ‘Marketing Strategy Process’ adapted
by Hooley et al (2008).

Recommendations about marketing strategies and the future growth potential of Primark will be
suggested after critically analysing the effectiveness of the Primark marketing strategies.

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PRIMARK: AN OVERVIEW
Primark, founded as Penneys in Ireland has fast established its position as a major retail group
employing over 68,000 people across 11 countries. “It offers customers quality, up-to-the-minute
fashion at value-for-money prices” (Associated British Foods [ABF] PLC Annual Report and Accounts,
2016, p.3). The company has enjoyed continued increase in market share and profits (ABF, 2016, p.3)
since its launch in 1969 despite negative press in the last few years over working conditions in
Bangladesh and other countries where its clothes are manufactured. Primark continues to pride itself
by offering customers up-to-date fashion that is made available at the cheapest of prices in comparison
to competitors thus making it a leader in the value market (Ross and Harradine, 2010).

The desire for value clothing lines is increasing and the recent recession in the UK has proven that
such business models can still perform well under such financial conditions (Mohsin, 2009) due to the
cost of items not requiring people to have large amounts of disposable income. The idea of value costed
goods in retail also allows consumers to make guilt-free and subconscious decisions when purchasing
items from Primark. The interest and purchase power in value markets has increased rapidly in the
European markets and where its new market (USA) is concerned, the company is still learning about
the environment and exploring their segmentation and competitive advantage (ABF, 2016)

Image 2: https://merchesico.wordpress.com/2012/04/23/shopping-in-peckham/

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SITUATIONAL ANALYSIS
The driving forces behind businesses are in the applied strategies of the marketing and financial
departments (Kourdi, 2011). Marketing will typically spearhead the way in which it foresees the
requirements of consumers and how they respond through their products and meeting the needs of a
fast-paced fashionable world. In 2010, Primark released their motto of “look good, pay less” and has
since grown their ranges and adapted their clothing lines by introducing new products to attract their
target market to meet their long-term goals (ABF, 2016).

Unlike other retail giants, Primark invests very little in marketing and instead relies on their customers
to “do the talking” (ABF, 2016) with their “big bags” (Mohsin, 2009) taking advantage of “big savings to
pass on the message” (Mohsin, 2009). Their decision to remain as physical stores rather than having
an online transactional website has so far not affected sales growth (Arvaniti, 2010) but questions
certainly arise as to whether sales could increase further, perhaps, exponentially, with an additional
website because “technology has played a strategic role in gaining competitive advantage in the
market” (Arvaniti, 2010).

At the top of the organisational hierarchy, they promote and pride themselves on being able to promote
that “decisions are made locally” (ABF, 2016). This allows each component of Associated British Foods
to conduct thorough research into their markets. Despite not spending a significant amount on
marketing, they have developed a unique understanding and insight into the consumers they target in
every country of operation except the USA where Primark is at an early stage of launching.
Understanding the environment, market shifts and analysing strategy, competitive advantage and the
economy will allow Primark to maintain their large market share and position as the largest retailer in
the UK (ABF, 2016).

The Marketing Strategy process displayed in Figure 1, adapted from Hooley et al, (2008) demonstrates
the various stages that an organisation can partake in, to establish and deliver an effective strategy
that will produce results in line with the organisation’s aims and objectives and ultimately to contribute
to the increase and maintenance of profit. The strategy allows internal stakeholders such as directors
to reflect and plan, implement and evaluate using the three elements- analysis, strategy and
application.

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 “The establishment of an effective marketing strategy starts with
assessment of company capabilities, strengths and weaknesses and
the opportunities and threats in relation to the environment”
(Hooley et al, 2004)

The 3 Model Analysis

The three models informing the following analysis can be found here:

Appendix 5: SWOT Analysis

Appendix 6: PESTEL Analysis
Appendix 7: Porters 5 Forces Analysis

As the foundation forming the Marketing Strategy process has informed us, there are many strengths
and opportunities (internal to Primark) that can be further developed however the weaknesses and
threats may also stem from the political, economic, social, technological, environmental and legal
standpoints, thus informing a PESTEL analysis.

The costs associated with political and legal factors such as ensuring working conditions are met, and
laws are followed in relation to minimum wage payments being met will result in a restriction in the
budget that could have perhaps been spent on other avenues such as company expansion or ‘digital
development’ which would have been a strength and opportunity to Primark to take advantage of
(Brignall, 2014). However, such conditions and requirements may lead to an opportunity for Primark to
negotiate with its suppliers since manufacturers are shared with other retailers, a joint force and retail
network may lead to Primark having a strong position in negotiating cheaper prices and costs. This
could also have an adverse effect because costs are expected to rise and better conditions may result
in higher costs on the supply side, posing a multitude of issues that can rise (Hall, 2014).

Current affairs in Europe and the decision for Britain to leave the EU will impact the operating
environments and trade as well as the currency exchange rates which have dropped significantly since
the UK EU Brexit referendum vote. This will drastically impact the price, cost and profitability of Primark
and their clothing lines. It is questionable whether in such climates they can maintain their market leader
position as largest retailer and whether their prices for clothes and products will increase to make up
for loss in currency conversions as well as operating in different legal jurisdictions. However, such
currency fluctuations will lead to lower interest rates and higher disposable income levels as highlighted
in the Economical and SWOT analysis. This may not be an advantage for Primark though as customers
may prefer to make other purchase from rival competitors that they may not have previously been able
to do (Allen, 2014).

A closer analysis of the shares of Associated British Foods reveals that share prices have increased
up due to the success of Primark (ABF, 2016). This share increase will need to be maintained to keep
their position in the market to strengthen their position and advantage. To do this, Primark and the
wider company, Associated British Foods need to consider adopting an effective long-term strategy to
exploit the potential profits surrounding future growth (Wood, 2014).

Given that online sales are reported to increase twofold by 2019, the question about online sales still
exists and the decision not to sell online may hinder and become a threat to Primark as they are not
able to keep up with the modern 16-24-year-old segment; one that is changing rapidly (Mintel, 2014).

Primark has strengthened their communications on their company ethics and social responsibility
making it a big feature on their website- a strength so far as the social considerations are concerned.
An opportunity may exist for Primark to make more a feature in their stores by promoting more of their
ethical trading initiatives, programmes and partnerships – perhaps by print on their recycled bags to
increase the awareness leading to a differentiation between Primark and its competitors.

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Understanding and continuously evaluating the target segmentation will allow Primark to gain a deeper
understanding of the changing social environment such as demography (Miller, 2014), analysing
spending habits by gender (Jackson and Shaw, 2009) and where/ how purchases are made
(Buckwood, 2013). This understanding has so far led to new product areas such as ‘AthLeisure; a
sportswear collection’ and ‘PS beauty’. Introducing new product lines gives Primark the opportunity to
enter new or current markets with new product lines and the opportunity to maintain and grow market
capitalisation.

A weakness highlighted by the SWOT analysis and in relation to social factors may be the ‘cheap’
factor. A strength to combat this is that Primark could be described as the supermarket of the retail
world given its wide and varying product ranges; Homeware, Clothing (Men’s, Women’s, Children’s,
Hosiery), Sportswear, Beauty, Footwear etc. This wide variety may entice shoppers as they can find
most of their needs are met in one store with cost leadership being implemented as per Porters 5 forces
analysis.

Despite having negative press, the sales have not declined concluding whether the customers of
Primark are more inclined to shop there due to the cost factor alone and critically questions the need
to promote CSR strategies as mentioned and highlighted in the SWOT analysis. This leads onto the
‘need’ for technology to be incorporated into the stores and the need for an online website or an app to
purchase items. The introduction of such applications will impact the logistical coordination of Primark
but will “maintain the customer’s loyalty and interest” (Thompson, 2014).

Porters 5 Forces, (Appendix 7) can be used to identify the tools that a business can implement to make
their items more profitable whilst outlaying the current situation vs a tool for stimulating creative ideas
with the aim to improve a firm’s competitive position (Birkinshaw and Mark, 2015).

The Environmental factors in relation to the SWOT analysis highlights several strengths to support
Primark in their promotion of their commitment to the environment. This is a big component of the
parent company annual report, Associated British Foods, 2016. Primark has established relationships
with organisations such as Cotton Connect to look at sustainable cotton farming methods and ‘the
green aspect’. This is a great ‘selling point’/ asset for Primark to rely on but the only way shoppers or
any interested stakeholder would come across this information is through thorough analysis and
information searching online. Even though ‘eco fashion’ is not yet a standard in the retail industry,
Primark’s interest in the area will help to set them aside from their competitors.

The analysis of these three models has shown that Primark has many strengths and opportunities that
can be used to combat some of the weaknesses and threats posed by the analysis of PESTEL and
Porters 5 forces.

Concluding the situational analysis

Having centred the organisation’s core strategy around the analysis of the environment it can be
concluded that Primark have put thought and consideration into the factors that affect their business;
taking bold decisions into not having an e-commerce channel and only catering for specific customer
segments through cost leadership. However, Primark work instrumentally with partners and key
agencies to maintain good levels of service and quality and contributing to the communities they work
in and to the people employed by their manufacturing partners.

Such traits and qualities lend Primark to closely relate with Porter's ideology of cost leadership. Primark,
as a business entity, along with their key stakeholders holds high confidence in their operational
methods and implementation and can use their bargaining power outlined in the five forces analysis to
continue trading as a ‘bricks and mortar’ only store. This decision alone helps them to stand out from
their supposed competitors as their customers are expected to walk-in to the store to take advantage
of the available offers thus creating a ‘come-back’ and ‘repeat business’ legacy, unlike other stores that
must continuously push their product lines to attract customers.

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It can be assumed, therefore, that customers have an expectation from a store such as Primark and
that expectation from customers may never change due to the nature of their business. The decline in
visiting physical stores in not likely despite all the advances in technology.

Having a website may not be justified as it will slow down the “six-week” turn around period and they
may initially incur additional costs in the setup of such additional services and operation across Europe
and American may cause further complications.

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THE PRIMARK STRATEGY
“If you nail positioning and targeting,
everything else will fall into place”
(Kotler and Keller, 2016)

Target Market and Segmentation

The big question for any innovative company is to gather intel and paint an image of their customer. It
is the question that every market tries to answer simply with sense and confidence. After all, though
the assumption may be that every company would prefer everyone as their customer, the reality is
somewhat different.

The test for any marketer is to understand how and what their customers think. Historically, the role of
a business was about selling what they could make or serve but that has fast and appropriately moved
to a new system centred around the needs and wants of the modern consumer. Kotler and Keller (2016)
suggest the idea of being able to sense and respond leaving the customer feeling satisfied whilst
simultaneously developing key relationships and ultimately defining and profiling the customer so far
as creating a realistic image (Brassington & Pettit, 2006).

The realisation that a business cannot be all things to all people is an important one and Gerald Zeltman
initialised a new way of thinking and understanding through piloting and creating a marketing
consensus plan. A marketing consensus plan for Primark has been complied to show an array of
information relating to customer profiling, targeting, segmentation and their offer to consumers as well
as their corporate social responsibility aims. This can be found in Appendix 1.

“Segmentation is the art of discerning and defining meaningful differences between groups of
customers to form the foundations of a more focused marketing effort” (Brassington and Pettit, 2006,
p.193). As indicated by Kotler and Keller (2016, p.285), segmentation must amount positively on five
key measures: measurable, substantial, accessible, differentiable, and actionable. In the clothing
business, these standards are met through four factors: Socioeconomics, Geographic’s,
Psychographics, Lifestyle (Müller and Haase, 2014).

In the case of Primark, they are attracting different segments through their offer of products: Homeware,
clothing for children, ladies, men, fitness line called Athleisure and Beauty. This division in the range of
products on offer allows the marketers at Primark to respond and organise their strategy into
components allowing them to develop characteristics and evaluate their markets to predict the success,
rise and decline as per the product life cycle (Appendix 2).

A recent example of successful market segmentation and targeting is the beauty line of products
launched by Primark. “In a global beauty market worth over £290bn, Primark’s PS beauty is firmly
making its mark” (ABF, 2016). This successful example means the company can cash in on their
successful integration and implementation of their strategy pertaining to profit on the 16-30-year-old
customer.

Therefore, the ‘perfect’ customer to walk into a Primark store can be drawn up from a mixture of
psychographic and behavioural attributes such as:

- Income levels – Primark follows cost leadership. As mentioned previously in this report, due to the
price factor, customers would be less prone to think about their decisions to purchase- these could
be described as on-the-spot, guilt-free impulse purchases (if based on price alone).
- Fashion savvy - availability of fashionable items in just a six-week turn around means that the
customer can have catwalk styled clothing at their fingertips as soon as they are revealed.

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- The supermarket of the retail world- Offering such a wide variety of products, the customer is likely
to walk around the store, psychologically making subconscious decisions as the store ‘shows’ them
what they may need/want
- Millennial generation (Howe and Strauss, 2007) – aged 16-24
- Tech savvy – grown up with technology and being able to access everything they need at the click
of a button- though Primark do not offer online purchasing, they do offer up-to-date fashion lines
and homeware.
- Fitness / Beauty enthusiasts- new ranges open more consumer segments
- Primania- Primark has a strong social media following encouraged by the option to ‘upload’ Primark
inspired looks using Primark clothes on their website under the sub-brand of Primania.
- Not concerned about the impact or not conscious of ‘disposable fashion’

The range of products on offer at Primark cater for different segments. This requires constant research
as the interests and types of consumers are forever changing. Research conducted by Pitta and Gurau
(2012) place Generation Y as the most eligible and core customer segment of Primark, though, as this
generation grows older, a new segment with different needs will need to be catered for.

Competitive Positioning and Advantage

The positioning and advantage a business has over rivals play a key part in determining share growth,
attracting customers, sustaining profits and analysing business strengths. Ultimately, the differentiation
in branding, customer perception, business strength, ethical considerations and community
contributions all take part into a wider notion of decision making when customers cast their choices of
where to spend their money.

Offering variety and knowing what the company stands for will ultimately help it to stand out in a world
where competition high and the need to make sales is paramount for profit. This idea and attraction
creates a concept in the shopper’s mind- what they can expect.

Also, this allows a company such as Primark to elicit what information their customers know and what
want their customers to know. Known as the metaphorical elicitation introduced by Gerald Zeltman.
The process raises vital questions such as:

- What markets are we attracting vs the target market?

- What makes our company stand out from our competitors?
- What financial and non-financial assets can the company rely on?
- What is the aim and how does this fit into current operational activities?
- How do we ‘future proof’ our business?

In line with Holcim’s Strategic principles and Porters thoughts around cost leadership, it can be
concluded that such strategies can be applied, for example, in addition to these strategies and Porters
5 forces, Primark has the advantage of good supplier connections, ability to turn visions into reality
within weeks and their low cost of production, high volumes allows them to remain as market leader
with a large marker share in the retail industry. Their strategic thinking and future proofing through the
introduction of new ranges such as fitness and beauty will only strengthen their position though stores
like H&M are also treading into such arenas and as a similar specific competitor, this presents the most
impending threat (Brassington & Pettit, 2006, p.962).

The Product portfolio models, found in Appendix 3 displays, (simultaneously) the assumed positions of
Primark’s varying products. This visually demonstrates room for growth, maintaining current products
and evaluating where new products may be placed. These three models combined reveal the growth
capabilities of each product as well as a quick analysis in terms of competitors and how markets can
be developed.

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THE MARKETING MIX DISCUSSION
McCarthy’s marketing mix is a well-established diagnostic tool which looks at the four main components
in promoting a campaign. It is crucial that each of the 4-P’s is examined to ensure that they identify with
the customer’s requirements and how Primark anticipates to meet their needs (Jackson and Shaw,
2009, p.86).

This discussion will evaluate the methodology of Primark in implementing the 4 P’s.

Price
As a cost leader and one of the cheapest leading retailers, this is an extremely important feature in any
of the marketing materials. In fact, visually speaking, when you enter the Primark website, we can
browse through some of the items on offer and the price is a main highlighted feature on every item
advertised. Thus, far in this report, several elements have been examined to conclude that the price
point is a big factor and their supermarket approach is working well and the company Associated British
Foods are enjoying profit year upon year.

This strategy, solely based on price, targets the consumer who expects value for money but how far
do these consumers expect the company to go beyond? Such prices are maintained because of
minimal design effort in conception and manufacturing (Reuters, 2014) as well as using lower quality
materials.

The price factor may draw in huge volumes of people who enjoy the low prices, satisfactory short-term,
disposable wear through the door and then are attracted to stay in store to browse other areas and
products. The almost economy-proof pricing strategies surely do bring customers through the door but
it remains to be seen if this can be maintained in 10, 20 or even 50 years’ time.

Though, the company have introduced clothes at higher prices too. Further analysis can be done to
look deeper into the impact of having an ‘exclusive’ range of clothing.

Place
Leading on from pricing strategies, partnerships with department stores such as Selfridges in
Birmingham has raised differing viewpoints as to whether Primark is suited in such a location and the
benefit it has on Selfridges. Though the benefits are both mutual- Selfridges are exposed to a segment
of market that perhaps would not have entered the store otherwise.

Throughout this report and comments in the industry revolve around the lack of online presence in
terms of opening new markets in a wider range of places- potentially the globe (Verdict, 2013). The
decision not to have a transactional website/app could be ridiculous or a very smart move. Having only
‘bricks and mortar’ stores leaves consumers with only one option- to walk in and be enticed by its
products and open plan floor design, enhancing the ‘customer experience’.

The logistics of operating in multiple channels would be advantageous in the sense of opening new
avenues of revenue but to begin with, it would require significant cash investment to set up the correct
systems.

Primark’s latest quest; entering the American market has taught them some important lessons per the
ABF annual report 2016. Though, this expansion may be difficult to grasp as they are spending a
significant time in understanding the difference in habits and shopping culture. Though a company may
find success in a specific location, it is not guaranteed that in different markets, the same success can
be replicated, however, they heavily promote, how in just ten years they have taken the Spanish retail
scene by storm (ABF, 2016).

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Promotion
Primark has been left to rely heavily on its customer base to ‘do the talking’ and promote the store. This
could be the impacting force behind not being successful in the American market. Relying on word of
mouth is fine for well-established businesses in existing markets however this becomes somewhat
difficult with new products/ existing products in new locations.

At first, the in-expenditure on marketing may seem like a sound financial decision but in the long term,
consumers may crave for more than word of mouth. However, Primark can enjoy its large online
following and through their website, consumers can share their ‘Primark’ experiences. Primark
acknowledges this ‘online relationship’ and agree that social media has a crucial role to play
(Retailweek, 2014).

The Primark website is used mainly for promotional purposes and promotes their values significantly.
There is a big disparity between the quality of stores however across the UK. For example, the
Tottenham Court Road store hailed as “the physical showcase” (Kent, 2009) provides the customer
with visual and enhancing experiences in comparison to smaller stores across the country and leading
bloggers have commented that such flagship stores are of much better quality and a higher standard
in comparison to the smaller stores (Melrose, 2014). This perhaps leaves room for further development
but again, we must consider whether Primark, a store known for its cheap prices is expected to have
such ‘in store visually stimulating quality”.

Product
Appendix 1 details the full product range on offer. Primark’s stores are designed to have a wide range
of products available, appealing to different personalities within the same consumer segment whilst
giving the largest attentions to women’s wear in terms of floor space, dedicated clothing lines and
window adverts with the aim to appeal to one of their biggest customer ranges – females (Mintel, 2014).

They serve a range of brand assets across all departments as well as a new ‘exclusive’ range which
saw an immediate rise in sales, giving customers a reason to purchase even more so because of the
psychological impact on the value that is associated with such ranges (Wood, 2013).

Offering such a diverse range of products and the nature of the product ‘turn-around’ maybe a reason
for the lack of online purchase ability. This is also allowing Primark to stand out from competitors.

Other considerations:
Whilst the 4 P’s is useful to some extent, they have been developed further to consider the customer
more. Such developments include the analysis of:

- People: who may be responsible for making such marketing goals come to life
- Processes – whether current business strategies include the analysis of resources and structure
- Measuring the outcomes and goals and predicting future trends
- Availability of products and or services
- Whether customer’s expectation is not met/ met or exceeded and the impact
- How the economy (internal and external) to all stakeholders involved make play and important
role
- Story creation of the ‘before and after’ production creation/ service delivery
- Inclusion of corporate social responsibility

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 “Businesses have to adapt and
thrive in changing times”
(American Express)

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CORPORATE SOCIAL RESPONSIBILITY:
WHO PROFITS?
“Taking care of our people, being good neighbours,
and fostering ethical business relationships”
(Primark Values)

The question for many business owners to understand and respond to “who really profits?” and to
answer such questions, a CSR policy may be in place. CSR has been described as:

“A form of self-regulation that many firms have taken on as a way of monitoring and ensuring
their active compliance with the spirit of law, ethical standards and international norms”
(Birkinshaw and Mark, 2015)

The rationale behind investing into a corporate social responsibility strategy will be manifold but the
main intention would be to promote the investment businesses make to its people, the community and
the environment, thus, feeding into the notion that it may help or contribute towards building competitive
advantage.

“Firms all over the world have elevated the role of corporate social responsibility” (Kotler and Keller,
2016, p.36). From the onset and in-store experiences may not lead the ordinary customer to think about
the contributions that Primark makes to the world it operates in and this could be because of a lack of
promotion of their social responsibility programmes and their commitment to ethics.

After the false allegations made by BBC panorama and the poor working conditions in several of its
manufacturing locations, its reputation was in question. To any business, reputation is an important
asset especially here since Primark rely on a consumer-to-consumer type of marketing.

Currently, Primark does not advertise their social responsibility programmes in store. However, they
do make it a big part of their website where 4 key questions are answered:

- 1) How can Primark offer the lowest prices on the high street?
- 2) Are workers making Primark clothing paid a fair wage?
- 3) How Green is Primark?
- 4) Does Primark use child labour?

These four, very valid questions examine the different areas of the CSR Triangle (Appendix 4) –
Economical, Environmental and Social factors. Such factors concern several key stakeholders.

Primark, after suffering from negative press has tried to recalibrate their image in front of their
stakeholders. Such press, for example, the downfall of Rana Plaza (Kayser, 2015), working conditions
(Dearden, 2014) and corporation tax scandals (Moon, 2013) led to the discovery of a lack of their social
responsibility and commitment to contributing to the wellbeing of their workers, the communities they
operate in/from and their legal and economic standpoints.

The way in which companies conduct their business must be analysed to hold them to account. The
failures in Rana Plaza were pointed out and may have been averted had they taken heed of advice
(Jones, 2014) but were then applauded for their victim settlements- though whether their reaction was
too late begging the question (Butler, 2014).

The rise in disposable fashion and as the leading value retail, Primark’s role in the ever growing ‘landfill
dilemma’ must be addressed and how their choices to keep to minimum wage payments is about

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contributing and doing the ‘bare minimum’. Does this strengthen their commitment to making an impact
socially, economically or environmentally?

Since the scandals, Primark have made an exponential effort to promote its ethics, values and
principles and they are now working with partners and non-government agencies to perhaps rectify
their past mistakes. Some of their current programmes are listed in the marketing consensus map,
appendix 1.

Despite the negative press, the correlation of sales has only grown in number and Primark has
continued to enjoy a rise in sales and profits thus raising the point of whether their segmented markets
are concerned about their social responsibility.

Operating out of Asia, having stores in America and across Europe with continuous plans for expansion
may well leave Primark exposed to their strengths but also to the many flaws they need to amend. The
globalisation of such a business requires constant evaluation and the more it makes and takes assumes
its position of being able to contribute more healthily whether that is through financial or non-financial
means.

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RECOMMENDATIONS
Following the analysis conducted into the marketing strategies of Primark, the following
recommendations have been concluded. The combination of models (SWOT, PESTEL, Porters 5
Forces, Product Life cycles, various matrixes) has informed the following recommendations which, if
implemented will contribute to the longevity of growth for Primark.

1. Develop an online E-Commerce website

One of the key discussion topics throughout this report has been the lack of a transactional website
giving customers the option to purchase Primark products online. This addition to the Primark stores
may possibly contribute to an increase in sales, market share and capitalisation. The ability to have
multiple options and choices when shopping online has won over the typical consumer making it a
necessity for retailers to develop a digital online strategy (Kent, 2009).

The investment into e-commerce may not be profit making at first due to the initial cost of investment,
however, with online sales growing exponentially, it is likely to derive profits in the future. This will also
help Primark connect with markets in other parts of the world and will contribute to a wider globalisation
plan whilst helping Primark connect with the new up-and-coming 16-24-year-old segment.

2. Segment to further develop product lines

This report has demonstrated that Primark does understand their market segmentation well and have
introduced product lines to keep up with lifestyle trends such as the AthLeisure and PS Beauty range.

Further segmentation will allow Primark to explore further opportunities for example, a maternity range
of clothing to fit in line with the notion of ‘disposable’ fashion and appealing to a wider range of
consumers- females that are 40+ (Retail Week, 2014). However, for this to happen, floor space
otherwise dedicated to other target shoppers will need to be reduced to make space for new items. A
study into this impact would need to be carried out to ascertain the likelihood of additional profit and
contribution.

3. Capture Market Intelligence

Market intelligence will allow Primark to gather data on “customer demographics, needs, buying
behaviour and attitudes (Burkwood, 2013), which can inform future marketing strategies. This database
can also be used to promote future products to interest consumers into walking in-store to see latest
items if they decide not to have an e-commerce website.

Capturing such intelligence can be done cost effectively, for example, online surveys with an incentive
or completing surveys in store.

4. Endorsements

Many of Primark’s rivals and competitors are constantly collaborating with celebrities to promote their
products (Reuters, 2014). Primark should consider working with high profile individuals to help promote
their product ranges such as AthLeisure and PS Beauty.

5. Visual Merchandising and technology incorporation into stores

Kent (2009) has recommended that "experience can prompt to the in-store encounter having a more
noteworthy effect because of interactivity, socialisation and communication" and Attwood (referred to
in Ross and Harradine, 2010) concurs by saying that 'customers should be motivated by the shopping
background and not simply low costs'.

16
The obvious uniqueness between stores could affect customer encounters. Be that as it may,
whether clients anticipate that distinctions will exist between stores because of area can be further
explored to achieve a conclusion.

Whilst the simplicity of stores may be due to the cost leadership factor the idea that stores are not
consistent from one location to another could be a potential loss in some cases in terms of offering
customers more than just ‘cheap prices’.

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CONCLUDING STATEMENT
From this report, we can look back and agree that marketing is certainly an important business
discipline. Considering the definition of marketing in the introduction of this report, Primark do have
some work to do in terms of future anticipation and whether the decision to not have an online
transactional website is negative or a sound business decision.

How this business will evolve as a typical ‘bricks and mortar’ store could make history as a store
dedicated to remaining traditional and not following the trend. This may just be their competitive
advantage and may be their strategy- to remain as a solid physical store to entice customers to walk
in.

Primark, as a subsidiary of Associated British Foods, should continue to use strategies such as the
‘Marketing Strategy’ adapted by Hooley et al (2008) to continuously analyse and interpret the changes
in the wider market.

18
Appendix 1: Marketing Consensus Map

Student Number: 1303501 MBA BEM 702: Marketing Management

Appendix 2:
Product Life Cycle

http://www.pro-tools-expert.com/home-page/2012/9/15/understanding-product-life-cycles-and-
what-they-mean-to-you.html

Student Number: 1303501 MBA BEM 702: Marketing Management

Appendix 3
Consolidated Product Portfolio Model
(Adapted from Boston, GE and Ansoffs Matrix)

Business/ Product Strengths

Existing Products New Products

STRONG WEAK

Market Penetration Product Development

- Beauty
Existing - Ladies and Children - Fitness
Markets clothing
- Hosiery
HIGH

Industry STAR QUSTION MARK

Attractiveness

Market Development Diversification

New - Men - Homeware

Markets

LOW

CASH COW DOG

KEY:
xxx – Ansoffs Growth Matrix

xxx – GE Matrix

xxx – BCG Matrix

xxx – Primark products

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Appendix 4
The CSR Triangle

22
 Appendix 5:
Primark SWOT Analysis
Strengths
- Takes as little as 6 weeks to have conceptualised designs
in stores on shelves (ABF, 2016)
- Wide offering of products to meet lifestyle needs- family,
individual, homeware, hosiery, beauty and cosmetics
(Jackson and Shaw, 2009)
- Relies on customers to ‘do the talking’ thus little to no cost
involved for advertising (ABF, 2016)
- Primark has a large involvement with organisations and
partners with the aim to maintain and develop their ethical
agenda despite negative press
- Large online following on connected social media
channels (Buckwood, 2013)
- Creation of multi flagship stores with freehold space
allows the company to grow without incurring the
recurring rental expense.
- Understands segmentation and launched a very
successful beauty and cosmetics range that gained
“praise and favourable comparison to big name brand
equivalents” (ABF, 2016)
- Launch of a new fitness range described as “a winning
blend of style and functionality” (ABF, 2016)
- Developed a Marketing 2.0 strategy (Kotler and Keller,
2016) to involve customers via ‘Primania’ on the Primark
website.
- Large open floor plans reveal fresh looking and large
stores.
Weaknesses
- Poor or lack of customer service could lead to negative
impressions and may impact the notion of letting the
‘customers do the talking’.
- Clothing lines and the ‘open floor’ may not be appealing
to all customers as well as constant havoc that is created
daily – requires large amounts of staff to manage store
appearances
- The branding is variable across stores and the stock (or
lack of) will also vary across stores.
- The low price may lead to customers thinking that the
products are of a ‘lesser’ quality in comparison to luxury
or medium priced items available from competitors.
- Solo and a heavy reliance on customers walking in-store
to make purchases and ignores the possible online
market.
- Questionable as to how much Primark truly understands
their target customer- large product lines that often are
not consistent may suggest otherwise.
23
Opportunities
- Creation of a transactional website and/ or a mobile app
where customers can purchase items or be informed
about latest releases.
- Creation of a Customer Relation Management system
to keep customers up to date with latest trends and
offers- this could be done geographically to make it
more relevant.
- Incorporate more features in store to capture the
interest and attention of stores as well as investing in
the ‘psychology of shopping habits’ to provide
intelligence about store layouts as well as improving
visual merchandising.
- Giving customers an option to order products when
stock is not available- however, this would require stock
maintenance
- Allowing customers to be part of the testing phases and
conducting more market research and surveys to
gather customer insights.
- Primark can also promote their ethical standpoints and
their commitment to corporate social responsibility
through in-store, on-receipt promotions.
- Incorporating more technology on the shop floor to
assist sales assistants
- Further segment markets to develop product lines for
older customers/ maternity/ plus size
- Explore markets outside of Europe and America
- Endorsements of high profile individuals and more
partnerships with stores like Selfridges (Hines and
Bruce, 2007)
Threats
- Competitors such as New Look/ H&M offering better
quality or similar/ cheaper price points
- Competition with supermarket brands such as George
(Asda) and F&F (Sainsbury’s).
- False or fabricated media reports such as the tainted
video from BBC Panorama and negative media
- Fast establishing brands are using digital advertising
means to attract customers.
- With technology, available at the touch of a button,
consumers are likely to search online to view deals that
may be better than those in-store (Buckwood, 2013).
- The number of UK stores and accessibility in
comparison to stores that have a presence on all or
most High streets.
- The interest and changing habits of shopping and
lifestyle in younger consumers may impact customer
targeting and segmentation.
 Appendix 6:
Primark PESTEL Analysis
PESTEL Effect
Political/ Legal - The rights of workers and conditions of
employment could be an area of concern
as it has impacted negatively in the past
with examples where employees in
overseas manufacturing plants have
resulted in extreme measures to ‘call for
help’ by attaching messages in the
stitching of clothing (Dearden, 2014)
- National Minimum Wage is said to cost
Primark “millions of pounds” (Butler,
2015)
Economical - Operating across several jurisdictions
results in trading across different
currencies, therefore exposing Primark
to significant financial losses if foreign
exchange rates fall.
- Primark’s decision to remain as a
traditional ‘bricks and mortar’ retailer
may impact on the level of potential
sales and profits.
- Hall’s (2014) report has suggested that
brands like Primark may suffer from an
“increase in materials, transportation
and labour costs”.
Social - After suffering negative press Primark
has made their ‘social responsibility’ a
bigger part of their website answering
key questions that consumers may have.
- Shopping habits
24
Strategies
- Work with relevant bodies in applying legal
policies. Primark can also continue working with
relevant partners and agencies to ensure working
conditions are safe and not over-bearing for
employees. This can be seen in the Marketing
Consensus Map in Appendix 1 – demonstrating
some of the different stakeholders Primark are
currently engaged with.
- Though this will cost millions, it is a necessary step
and one that can be accounted for by future
financial forecasting- whether prices of good will
need to increase will also need to be considered.
- Primark in the UK may currently be suffering due
to the current weakness in the pound because of
the decision to leave Europe, however, there may
be an opportunity as weaker currencies result in
lower interest rates and a possible freeze on the
rate of inflation which in turn leaves potential
consumers with a higher level of disposable
income (Langley, 2008). However, this increased
disposable income may leave consumers
preferring to shop at expensive/ better quality
clothing stores (Allen, 2014)
- Mintel (2014) has concluded that online sales
across Europe are to exceed over 100% in the
next five years. Another evaluation into the
possible impact of entering e-commerce may
prove to be useful for Primark to gather data about
the potential investment cost and whether there
would be any return on investment, although, “e-
commerce is the fastest growing retail market in
Europe and North America (Retail Research,
2016)
- Primark’s target consumer habits will be changing.
The current target market, otherwise known as the
‘millennials’ are different to the up and coming 16-
24-year-old because of differences in technology
use and the idea that they can purchase anything
at the touch of a button through e-commerce
means.
- Such cost increases may impact value based cost
leadership companies like Primark because of
their business model being based on cheap
clothing due to large volume orders. Primark will
need to implement strategies to keep their cost
leadership/ market position or increase prices and
risk losing their position as such.
- Whilst, transparency may appear to matter for
retailers and consumers in the wider sense, it does
not seem to matter so much with value retails as
the ABF (2016) report shows a steady increase in
profit and no suggestion of loss in income due to
negative press.

Technological - Incorporating technological features in
store and possibly online.
Environmental - Consumers are increasingly becoming
more aware and interested in the impact
on the environment especially with the
widely publicised effects of global
warming.
Appendix 7:
25
- Verdict (2013) reported that 80% of customers
now visit retailers offering ‘value clothes’. This
footfall may be the reason that Primark has
decided to keep to their traditional physical stores.
Being amongst other stores in large shopping
venues will allow Primark to continue benefitting
from in-store visitors who will make guilt-free
decisions to make purchases based on price
alone.
- Changes in the population, a decrease in younger
people and an increase in elderly due to higher life
expectancies may open a new market for Primark.
(Burt et al., 2012)
- As previously mentioned in this report, Buckwood
(2013) has suggested that ‘showrooming’ is now
the trend- the idea of going into stores, finding
items and then purchasing them later online.
However, this may work in favour of Primark
because consumers may not find items as cheap
as Primark. It is also questionable whether this
may directly impact the type of consumers in
Primark.
- The consumer’s behaviour has significantly
evolved. The behaviour of the younger generation
and their habits of shopping online is relevant here
because of the target consumer for Primark. Are
Primark neglecting a possibly fruitful opportunity?
- eBay (2014) conducted research which concluded
that retailers saw an increase in profit when they
incorporated technology on the shop floor – 89%
saw an increase in growth of their business.
- Primark has teamed up with partners such as
Cotton Connect (Marketing Consensus Map,
Appendix 1) to work on their ‘green cotton’ agenda.
Primark has been proactive and promote their
partnerships with such organisations. Primark is
not alone in being environmentally conscious.
 Primark Porters 5 Forces analysis
Threat of New Entrants
Level of impact: 2/5
- Brand loyalty and the price factor and convenience may not impact the threat of new entrants to the market.
- It would be extremely difficult and a long process to build the same reputation, brand, logistical coordination as
Primark as well as their power to turn around designs to store shelves in just a matter of weeks.

Supplier Power Competitive Rivalry Buyer Power

Level of impact: 1/5
- Shares manufacturing venues with
other companies
- Low overheads/ salary cost in
comparison to UK production
- Supplier relationship is
continuously developing after the
factory scandal in Bangladesh
- Suppliers can be substituted but
there would be loss of time,
resources and efficiency.
Level of impact: 4/5
- Types of competitors will
include those in the same
market to attract the same
customer – there are a
significant amount
- Other competitors do not solely
focus on price as a factor and
offer wider ranged items – New
Look/ H&M/ Supermarket
brand assets
- Good level of customer loyalty.
Level of impact: 2/5
- 1 out of 7 clothes is purchased
from Primark- Financial Times
- Primark offers a ‘guilt free’
shopping experience as it attracts
people through their low prices/
up-to-date fashionable lines and
attracting customers through
beauty and sports ranges
- The Primark reputation across
Europe allows customers to make
informed decisions about their
purchases from the stores- they
know what to expect and stores
are available in main retail spaces
with more stores opening all the
time.

Threat of substitute products

Level of impact:4/5
- Whilst customers do not have the option of an e-commerce platform, they still have access to stores and Primark
locate their stores with precision by understanding their geography

26
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