Zara Essay

Let us first consider Zara 's main competitive advantage before analyzing how current and potential future strategies will affect this competitive advantage. Zara currently employs a "design-on-demand" retail model allowing the company to bring the latest fashion trends from

Zara International was a retail shop originated in La Coruna, Spain in 1975. It was clothing and accessories shop and imitated the latest fashion trends and sold them at a lower cost. It became Zara International after entering Portugal in 1988 and then the United States and France in the 1990s. The distributor for this brand is Inditex and is considered the most successful retail chain in the world. Zara has a business strategy that is very different from the retailers nowadays. If a customer orders a product Zara’s distribution centers can have the items in the store within 24 to 48 hours of receiving the order, depending upon the country. The business plan that Zara’s executives made was very innovative and played a great part in the

Zara mainly focus on high performance where it follows a thin organizational structure which also cuts down the managerial hierarchy levels and decision making. It also reduces or customize on administrative process. The Zara Company

The history of Zara started in 1975, when the first store has been opened in Spain. It has been followed by several other stores all over the world. The company’s owner, Amancio Ortega, accumulated 340 million Euros (according to 2001 datas), which is a remarkable growth if compared with other companies. Zara’s brand has become popular because of its quality and efficiency.

            The main goal of this report is to analyze the environment how Zara wil be marketed and launched in India. Analysis shows that the main problem of the product is to in terms of making the target market know the existence of the product in the country and the competition of the current clothing lines available in the market.

For that reason, most of all the products Zara offers globally are relatively standardized fashionable products. In terms of marketing costs, Zara relies more on having prime retail locations than on advertising for attracting customers into its stores. It spends a meager 0.3 per cent of sales on advertising compared to an average of 3.5 of competitors according to the company, choosing highly visible locations for its stores renders advertising unnecessary. Zara provides following options to its targeted market:-

The business idea of Zara is to link customer demand to manufacturing, and to link manufacturing to distribution. And based on this general idea, Zara has several essential elements for its business model. First, speed and decision making, which means that in the external level, Zara need to respond very quickly to demands of target customers, and always keep in style. While for the inside, Zara treasure intelligence and judgment of common employees who enjoy a great deal of autonomy. Second, its marketing, merchandising and advertising strategy. Zara does not spend on virtually advertising, while it spends heavily on stores, and no selling online because of

Zara is an apparel company and the leader brand of the Spanish retail mogul, Inditex. zara was established in 1975 in Spain by Amancio Ortega who is currently the 3rd richest man in the world, the first store was opened as an outlet but by 1979 the establishment already had six stores at different locations in Spain and by 1985 the company branched out to Portugal new york city and Paris. Today Zara has over 1900 stores worldwide which are located in 22 different countries; these stores render employment to over 125,000 employees. Zara depends on information they gather from customer and organizational feedback from all their stores on a daily basis this information is then forwarded to the supply chain, which works in synergy with the stores to keep the level of storage in stores down to a minimum. Zara owns the production, supply chain and in-house production, which lead to greater speed in output (M.A.Cano)

Based on Michael Porter’s universal strategy, Zara are put on board economy scope. Zara available cost leadership strategy and additionally differentiation system, combined this to win its competition. Zara play at fair price because they build cost authority strategy, consequently even they set for reasonable price they nonetheless could gain reasonable perimeter. And developing differentiation tactic enables Zara to design and end products in a much reduced time as opposed to the competitors.

The diagram above will enable us to understand briefly about how Zara positions itself in the market.

Zara’s product differentiation strategy is based on high quality and low prices. The company wants to be fashionable and desire for everyone. This is the reason of their strategy (low price and high quality).

Zara is currently operating in a single county and that’s why faced a social influence that was already coped by Azadea group for its other brands. Luckily, Zara got a country based on independent cultural roots. A long history of United Arab Emirates in arts and design has an excellent contribution in artistic and designing field. This country has a quiet social environment, pulling in visitors on huge scales, having bunches of splendid social occasions. Solid tourism exchanges allow retailers like Zara to get acquire clients and after that retaining of clients is finished by quality fulfilling clients' needs. Zara's strategy of higher turnover encourages offer of

Zara offers many sources of value to their customers, with heavy focus on the social and hedonic benefits of their product lines. Customer value is hard to define, and thus have many different ways of understanding from person to person. Generally, values may refer to: low price, receiving what you want, quality to price, and comparing what is received to what is sacrificed (Zeithaml 1988). Zara appeals to these ideologies of value through a variety of activities. These include:

What distinguishes Zara from its competitors is the feedback that Zara’s managers get from the customers at the point of sale about new garments or new products that they are interested in. Around 60 percent of its products are permanent and the remaining 40 percent vary continually. The company estimates that customers visit a Zara store 17 times a year on average, compared to merely four visits for other fashion firms. The outlets are situated in main commercial areas and the interiors are designed to create a unique atmosphere with attractive window displays. The firm spends only 0.3 percent of its annual turnover on advertising , normally at the beginning of the sales season or on the occasion of a new store opening. The store is considered its most effective communication tool. The two key factors in Zara’s business model – the time factor and the store as a source of information – demonstrate the company’s customer

Inditex itself is a huge fashion retailer company which owns 8 brands namely Zara, Pull &Bear, Massimo Dutti, Bershka, Stradivarius, Oysho, Zara Home and last but not the least Uterque. Amancio Ortega is the founder of Inditex, which was established in 1963. Amancio Ortega adapted unique business model, which were innovative and flexible. This made Inditex one of the biggest retailers in the world. In 1975 Inditex established Zara’s first store in downtown A Coruna, Spain. Zara offers fashionable designs for men, women, and kids. They also sell accessories to complete their product lines.