Why Primark is so Cheap (and why they are always winning)

DISCLAIMER: The information is shared in this video is purely what I have experienced and researched without any intention of controversy. I am not affiliated with Primark.

TRANSCRIPT:

00:00 Intro
00:35 Price
02:56 Physical Locations
04:34 Influencer Marketing
05:28 Selling Trendy Products
07:48 The last one

1. Price

What I found is that Primark has their main competitive advantage in price when Primark sells clothes for very cheap, so you would go to their stores and you'll find t-shirts that costs £3 and a lot of the times you're wondering, WHY ARE THEY SO CHEAP?

When you look into the business decisions that Primark has made and the relationships that they had acquired it, it comes to the point that they have a very-well established relationship with their suppliers and what that means is when Primark buys their clothes, they get them in bulk because they know that they will sell it so one of the biggest advantages of their business model is that they sell a lot of clothes. So they focus on quantity, but lately as well, they've been focusing on quality. If you go into a Primark store, you will see that they are now targeting the home industry. For example - Home Appliances, Plates, Kitchen Essentials, and bathroom accessories, whereas before, when you go into a Primark store, it was purely clothes.

2. Physical Locations

If you ever been in any UK town, it doesn't matter if it's London, or if it's a small town anywhere in the North East, you will find out that there's a lot of Primark stores and they're always huge. If you ever go into a store, you will see that whatever is shown on the shelves, that's what's avaialble so even if you ask an associate if they have any particular product, they won't. Their stores are usually 2 or 3 stories and have lots of products all filled up with products. So if you want a hoodie, you'll find out as many colors and sizes available nd you can always find what you need.

3. Influencer Marketing

There's also one really awesome thing that Primark has started doing and that's influencer marketing. Influencer Marketing is basically when a brand sends products for free to influencers so they can review them with the thinking that the influencer's audience will be interested in the products. So for example, if you go YouTube now and type in "Primark Haul", you will see many influencers making videos about the products they bought and it's usually their newest collection being reviewed.

4. Primark doesn't heavily advertise

If you notice something interesting about Primark is that they don't advertise as much. There are only a few brands that can have the luxury to do this and I think it's one of the most successful valudations a company can have is to not advertise, because this confirms that everyone in the country or internationally knows about the brand, so Primark has had a huge success to be one of the landmark stores in the UK. And there really is a handful of brands that don't advertise online or on TV too much, because they're well-known. Not spending money on advertising means that their products can keep their cheap price. So to me, Primark is a very, very interesting brand that I've been exploring for a long time. And it's eye-opening when you go into one of their stores, because you will see exactly what I'm talking about. If you ever have a chance, go visit one. And you will see the prices, you'll see the products, you see the variety, you see what audience they target, you see that now they started targeting newcomers into the city & new people who are moving into the country, so they started selling things for your home and bathroom accessories.

5. They don't have an online store

I wanted to leave this for the last point because that is the most mind-blowing things about Primark - they don't sell online. And I personally asked them about it a year ago and they said that they will not become an online retailer because starting an online store has costs that are not associated when you only sell in-store. Things such as delivery, transportation and returns are only a handful of the costs which will be projected in the price of the products, meaning that their biggest competitive advantage - price, will no longer be considered in comparison to other brands, so what does Primark do? They don't sell online.

LET'S TALK:

[Karavaki]

Superficial. That s not the answer why primark is so cheap. You need to dig in more into data and make a proper investigation about the business