Passion For Fashion ZARA Presented By: Eva (Yihui Yan), Sylvia (Fei Gao), Emma(Hanul Yang)
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Transcript of Passion For Fashion ZARA Presented By: Eva (Yihui Yan), Sylvia (Fei Gao), Emma(Hanul Yang)
ZARA History and SWOT Analysis
Global Expansion and associated challenges
Industry Analysis and Competitors
Short –term and long-term Recommendations
Conclusion
ZARA
• Parent company : Inditex by Amancio Ortega • In 1975, first ZARA store in A Coruna, Spain• SPA brand, fast fashion, instant fashion• Line up – women, men, kids• In 1980, Zara started to expand globally• Unique supply chain• Zero advertising policy• 1,444 stores in 77 countries
SWOT Analysis Strengths
• Point-Of-Sales System send information products reflect quick feedback
• Unique Supply Chain 3 lines work separately designers + market experts send designs Zara factories produce • Accurate delivery use planes and trucks
• New products every two week• Make customers visit store more frequently • Prevent overused discount and sale• Get good reputation from viral marketing
Weaknesses• Can’t meet customers’ re-buying needs• Intense concentration on European markets • Low brand recognitions in certain markets
Opportunities• Potential markets• More online shops• Fast fashion market ; PRAV
Threats• What if some thing happens in Spain?• The continued rise of Fuel price• Newcomers with similar style
Zara Global Expansion
• Global Expansion - International presences all over the world
• Europe - First : Porto, Portugal in 1980 - Second: France 1990 - Third: Belgium & Sweden 1994• North America - U.S 1989• South America - Mexico 1992• Asia - Tokyo, Japan 2004
• Now- Zara owns 1,444 stores worldwide in 77 countries.
Global Expansion Strategies
Standardized Global Marketing Lower the cost Offer standardized apparel Economies of scale
Vertical Integration [centralized approach] design produce distribute
large R&D group: > 200 people (designers + marketing experts + production managers)
Global Expansion Strategies
Zero Advertising Policy
0% - 0.3% of its
revenue in commercials
Use fashion shows &
posters instead
Internet Retailing Strategy
Divisions: (official web)
Woman/Man/TRF/Kids– Look book – Magazine – Catalogue
Zara in Emerging Markets
BRIC Brazil – 27 stores Second largest market in South America Russia – 37 stores, stores in Moscow, Saint Petersburg India – 3 stores (Delhi, Mumbai, Bengaluru) Joint-venture with Tata China – 60 stores Shanghai, 2006 Beijing, 2007
HK, 2004 Macau, 2007 Chengdu, 2010
0
10
20
30
40
50
60
Brazil Russia India China
Zara Stores in BRIC
Stores
27 37 3 60
Beijing, China
New York, U.S.Hamburg, Germany
Challenges
• The tightly controlled supply chain won’t fit every market, especially the foreign one.
• Different regions
have different understanding of fashion.
• Hard to implement
the whole business model due to joint venture ex: India
Chanllenges
• Fierce competition
- local: MNG (MANGO)
- global: Gap, H&M, Gucci
• Glommy Economy
(Financial Crisis, 2007-2010)
Shrinkage of the fashionable clothing sales
Industry Analysis
• Product of the modern age
• Developed first
in Europe and America
• Consists of four levels
1. the production of raw materials
2. the production of fashion goods
3. retail sales
4. advertising and promotion
Fashion Capitals Rankings
Zara, $9.55
billion
HM, $17.98 billion
GAP, $14.50 billion
Gucci, $3.06 billion
Renvenue in 2009
ZaraHMGAPGucci
Competitors
• spend more money on advertising.
• outsource all of their productions
• 0% - 0.3% of its revenues in advertising
• In Spain, Zara owns 22 factories, and 50% of its products are made by their own manufacturers.
VS
Competitors
• Luxury good: High-grade, luxurious, classic style
• Target market: Age: 25-40
• leather goods, shoes,
watches, perfume, household goods and pet supplies
• Fair price, fast fashion, low-cost
• Target market: Age: 18-35
mainly women and men,
kids clothing
VS
Competitors
• The largest clothing company in USA
• Focus on the Jeans and hoodies
• Casual, sport style
• Multi-Brands:
GAP, Banana Republic,
Old Navy
• The largest clothing retailer in the world, No.1 in Spanish Clothing Market
• Sweaters, T-shirt
• Relatively mature
• a subsidiary of Inditex
VS
Competitors
Short-term recommendations
Promotion activities
DIY – Design It Yourself!
More Online stores
Internet advertising
Long-term Recommendations
• Advertising- TV commercials- Advertisements on magazines- Activities ( involve customers)
• Differentiation- Offer sepcialized products uniquely designed for a certian culture/region
Long-term Recommendations
• Improve its logistics and build ECR system to react more quickly to changes in consumption patterns
• Locate more manufacturers and distribution
infrastructures in emerging countries
• Franchising
conclusion
▷ Challenges
• Tightly controlled
supply chain• Different fashion concepts• Competitors• Gloomy economy
▷ Recommendations
• Advertising• Online shops • Various promotions• Improve logistics • ECR system• Building infrastructures
in emerging markets• Franchising
▷ Global Locations:
1,444 stores in 77 countries