Zale Case Study

The ramifications of a wrong choice will cost lost time and a scarce marketing budget, as well as affecting the business’s bottom line. Marketers attempt to create an image or identity for a product, brand or company and usually express positioning relative to other competitors in the market. Positioning Zara’s product or service is simply defining who they are in the customer’s eye. When positioning a product or service, it is important to decide what the sustainable competitive advantage of the produce is versus its chief competition. The product will have a better change of success if it has a sustainable advantage; hence the product has some unique offering competitors do not have and that it can hold long term. Some small businesses use a positioning strategy, known as the unique selling proposition, which identifies and communicates the company’s most compelling offer and benefit in a way that answers customers’ question, “what’s in it for me”. Another important aspect is that positioning strategies should not be considered fixed. A reevaluation may be in need, if competitor offerings change, the business environment changes or the strategy proves to be marginal. However, constant modifications may confuse customers, therefore changes should only be made when

Zaras inventory turnover is higher than their direct competition (at 10.67% versus H&M at 6.84%) (D’Andrea et al, 2003). Constantly changing stock encourages sales and increase the average visits to stores per customer (Kotler et al, 2009).

What do you think of ZARA’s international strategy? Evaluate, in particular, its strategy for (product) market selection, its mode of entry, and its standardization of its marketing approach?

These days the assumption that contracts are freely made by equal parties no longer applies in the consumer context. Unequal bargaining power In the modern marketplace most consumer goods and services are manufactured, marketed and sold by large businesses with access to expertise and resources far greater than those available to the ordinary consumer. There is usually a marked inequality of bargaining power between the parties,

Zales Corporation is an organization that handles upscale jewelry. It all began in 1924 with a single Zales Jewelers store and has now emerged into a successful company with six retail brands and approximately 1,870 stores in North America as well as websites for each brand, Zales.com, gordonsjewelers.com, zalesoutlet.com, peoplesjewellers.com and pagoda.com. Zales focuses on customer and employee satisfaction. The company offers various, high-quality jewelry and services to help customers achieve a level of satisfaction unmatched by their competitors. They offer the best quality jewelry at an affordable price.

Zara’s business model can be broken down into three basic components: concept, capabilities, and value

Notably, in 2009 the company was acquired by the world’s largest online retailer, Amazon.com. In the agreement, Amazon promised that Zappo’s operations and governance would remain intact, independently run as if a wholly separate company. The mutual alliance was ostensibly made because the customer service-centric culture was found to be co-inspired and compatible. Another reason was likely because Amazon could help the company expand gracefully and in orderly fashion as Zappo’s sales to that point were largely doubling every year creating strain within the company to grow alongside their sales. Fruits of this “acquisition” were likely present when Zappos restructured the organization into 10 separate companies under the Zappos brand, listed below:

Key expenses/Cost Drivers – There are fixed, semi-variable, and variable costs in the Zara business model. Fixed costs are the first major expenses in the business plan including: design and building lease. The major semi-variable cost driver affecting the plan is labor costs. The major variable costs are food and alcohol expenses. Non-recurring costs for equipment purchase and construction are also major expenses in the first year of opening. These cost drivers are unlikely to change with the current model. The cost structure of Zara is based on the dominant cost driver of the business model – food and drink. Therefore an inventory structure combined with a payroll-centered structure best describes Zara. The primary cost center at Zara’s will be its marketing and promotions department. This is an extremely important aspect of Zara’s overall strategy. The owners intend to draw-in patrons from outside their local neighborhood, without a penetrating and successful marketing strategy Zara’s customer

The main concepts that can be taken away from Zara’s business model, which directly affect its operating economics, is low cost, high control, and quick turnaround. Zara is just one of six retail stores operated by, Inditex, the parent company. Inditex owns Comditel, a subsidiary, which manages the dyeing, patterning, and finishing of gray fabric and supplied finished fabric to external as well as in-house manufacturers. By owning this company, Zara is able to maintain low cost production while being able to finish fabric in a week. Zara has the ability to obtain its main raw materials as well as the final

Zale Corporation is a leading specialty retailer of diamonds and other jewelry products in North America. The Company has significant brand name recognition as a result of each of its brands’ long-standing presence in the industry, having 2.349 stores in the United States, Puerto Rico and Canada.

Zara is a modern day fashion business that takes an unconventional approach in their business model. Zara is one of the largest international fashion companies which belongs to the distribution group called inditex. They sell well made relatively cheap pieces of clothing that is always cut according to the latest fashion designed. Their customers are the heart of their designs, productions, distribution and sales. Just like all fashion companies, their primary goal is to be the number one fashion retailer. To obtain that success, their new business model challenges the industry and pushes them ahead of their competitors. Zara unique approach to fast fashion pays off as many other brands are trying to follow their success. What sets Zara apart from other modern businesses is that, their business model is to react to fashion trends as quickly as possible. Zara adapt quickly to current trends and fashion that the public demand. Their goal is create fresh new trendy design almost every one to two weeks that will be ready to be produced and shipped. Their primary goal in creating these new sketches is not only to identify trends but to evolve and never repeat their designs. Zara’s company’s strategy involves stocking their inventory very little and updating their collection often. This benefits them because it makes the shopper feel like they have to buy the item, or else it would be sold out later on. Zara’s risk taking strategy has proven to work because according to

The rapid increase in consumerism marked the beginning of a vicious competition between companies who were competing for their client’s money. Consumers

Zara brand products are part of the Inditex Group which was founded by Amancio Ortega. Zara brand products currently compete in what is called the fast fashion industry. Fast fashion is a trend in the fashion industry where companies produce and sell new clothing trends within the market as quickly and cheaply as possible (Fernando, 2015). This is made possible by new innovations within the supply chain management of these companies. Innovations are precisely the way Zara has become one of the top fast fashion businesses in the industry. By utilizing their core competencies along with efficiently managing their supply chain, Zara has developed a way to give customers what they want faster than anyone else (Hitt, Ireland, & Hoskisson, 2017, p. 100). Zara has done an excellent job at defining its business strategy and utilizing their core competencies to create value for their customers which is why they keep coming back. This also brings in new customers to purchase from Zara. The purpose of this paper is to examine Zara and various aspects of their business.

strategy is an integral part of the organizational culture and is one of its core values. Each

Zara has proved to be a maverick of its time – it came at a time that the apparel industry was fragmented there was no integration, the costs incurred were enormous it was highly labor-intensive leading to outsourcing to save on costs and the business model prevalent was not proving to be highly successful as compared to the models of other industries. In came Zara and showed that strategic imperatives depended on how a retailer sought to create and sustain competitive advantage through its cross border activities and seamless operations, the power of integration and the importance of sticking to your positioning without adding too many frills. Zara's factories were heavily automated,