Redefining Retailing

“ P O S S I B LY T H E M O S T I N N OVAT I V E A N D DEVASTATING RETAILER IN THE WORLD”DANIEL PIETTE - LOUIS VUITTON FASHION DIRECTOR

HISTORICAL BACKGROUND

Cofounded by Amancio Ortega & Rosalia Mera, 1975, Spain

Europe’s leading apparel retailer

Hold a brand value of $8.7 bn

More than 5900 stores in world

INVENTORY OF ZARA

Women’s

Men’s

Zara Kids

Zara footwear

WOMEN'S

MEN’S

ZARA KIDS

ZARA SHOES

ZARA’S STORE VALUES

# Adapt quickly to fashion in demand

# Improve quality

# Sell modern design at affordable prices

# Have a perfect distribution system

ABOUT ZARA

One of largest international fashion companies.

Belongs to Inditex, world’s largest distribution groups.

The customer is at heart of business model which includes design, production, distribution and sales

COMPETITORS

SEGMENTATION TARGETING STRATEGY

Demographics of customers like gender, psychographics and age

PARITY POINTS

International recognised European fashion brand

Prime retail location

POINTS OF DIFFERENCE

Fast fashion

Exclusivity

Understanding customers needs

ZARA’S BUSINESS MODEL

BEING ABLE T O O F F E R NEW ITEMS THAN WHAT SELLING IN O T H E R STORES.

REDUCE THE LEAD TIME FROM DESIGN TO DISTRIBUTION.

DESIGN AND PRODUCTION

# Employ hundreds of employs at its headquarters

# Speed fashion - Production houses near Spain

# High control of manufacturing process

“WHAT’S HERE TODAY MAYBE GONE IN 2 WEEKS” —NY TIMES

LOGISTICS

Delivery across the globe

Rapid delivery system

Having 50% of production units is key to its success model

CUSTOMERS

Customers needs are addressed with daily reports from ZARA stores managers

Customers feedback - good or bad- is reacted with immediate effect

STORES

ZARA never runs an ad campaign

ZARA stores are themselves ad elements

Spend only 0.3% of revenues in ads

Helps save revenue for the company

ZARA’S UNIQUE BUSINESS MODEL AND OTHERS

Zara stocks clothing in scanty quantities. They don’t order more stock in.

“They’ve trained consumers not to wait for it to go on sale,”

Zara’s factories are based in Europe, new designs get into stores in two weeks. Others have to get it from companies like China.

The cost of distribution is lower

EXPANSION OF ZARA

Incorporate technological advances like marketing on social network

Increase its presence in developng economies

Further close its communication loop

Give their capital assets to increase supply chain flexibility.

Partnering with other small retailers.

SUMMARYHistorical background

Inventory of ZARA

ZARA store values

About ZARA

Competitors

Segmentation targeting strategy

Parity and disparity points

Marketing Model

DISCLAIMER

www.zara.com

www.nytimes.com

www.facebook.com/zara

www.wikipedia.com/en/zara