Business Strategy: ready-to-wear clothing from Zara
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The arrival of China has created a great upheaval in the world textile market. Europe, which is the Mecca of traditional garment making, is particularly affected, and has undergone structural changes in its industry with the trivialization of the clothing chain with the introduction of standardized products at low prices.
Since the early 90s, the most striking reaction vis-à-vis this arrival, is the appearance of specialized stores, which offer a superior range of products. The two European brands that stand out particularly, are H & M and Zara. They have imposed the same model on the market: style and "fashion" inspired by the great couturiers, but at low prices, with collections that are renewed constantly and very fast.
However, the Spanish retailer Zara seems more responsive to the current trend. It managed to renew a collection in just 15 days from the creation to the shelf.
How did a European company, in a rather dreary domestic sector, succeed in becoming so profitable? In addition to dominating the European market, it is one of the brands that sells the largest number of clothes in the world, and is growing in emerging markets.
This study will investigate the brand, seeing how Zara has built a competitive advantage that distinguishes it clearly from other companies that market ready-to-wear clothes.
Specifically, Zara comprises trendy clothes, inspired by its collections, or sometimes directly copying the catwalks of haute couture of the moment.
A fashion inspired by the taste, desires and lifestyle of women and men today, it is available at affordable prices, which is a real competitive advantage. There is also a wide range of choice, because the true strength of Zara is its vast range (11 000 models per year), divided into sub-brands, each corresponding to a type of client. The brand takes only 15 days to design new models, fabricate and deliver them in any store in the world.
The brand Zara was first created or started in 1975 in La Coruña (Galicia, Spain) by the Ortega family, who owned textile factories since 1963. The company launched and acquired other brands of clothing Massimo Dutti, Bershka, Stradivarius, Pull and Bear in 1995. The Zara Home was launched in 2003.
Zara naturally favors the ardent shopper and makes it a point to have prestigious addresses in the capitals of countries where it is present, the Boulevard Haussmann in Paris or Fifth Avenue in New York. Before deciding to open or create a store, the company is studying the demographics, employment and purchasing power of potential clients that the area attracts.
Unlike its competitors, Zara does not practice promotion. Only during the winter sales and summer do the customers benefit from this type of offer. In fact, Zara plays on the renewal of its showcase every 8 days to urge consumers to return to the confines of the store.
In Zara the management's responsiveness prevails. The reactivity of all five branches of art is solicited. All work closely together and must be attentive to markets its evolution, requests and expectations. In the managerial chain at Zara, each must be reactive, fast in catching on trends and listening to customers.
Tags: Zara, merchandizing, sales concepts at Zara