Revenue Model : How Will The Organization Earn Money?

1564 Words Sep 14th, 2016 7 Pages
Revenue Model (How will the organization earn money?)
Inditex owns Zara among others. They demonstrated a strong first-quarter profit and revenue growth across all of its major regions where they operate. From the stock market stance, their shares rose 5.5% in Madrid.
Their strategy is that they do not spend on too much doing extravagant ad campaigns. Rather they invest their resources on developing store campaigns, ensuring that they focus on customers that they have a seamless experience shopping on their website and having a user friendly shopping experience.
Besides, they have a lot of control over the lifecycle of how they carry out every aspect of their production. For example, right from designing to manufacturing to distribution and sale. This allows them to have significant advantage and position as they have end to end visibility and flexibility to quickly shift costs to adopt a more cost- effective solution. This makes them more agile in their operations.
An example would be how their in house approach allows them to react quickly to changing trends. Apparently, they produce around 12,000 styles per year compared to the average in the retail industry of 3,000. It is believed that a single piece of clothing can go from concept to shelf in less than a fortnight.
Market Opportunity (What market space does the organization intend to serve and how big is it? Who are the customer targets? What is the potential for financial gain?)
Zara’s target market is young,…
Open Document