Jasmine Robinson
Brand Report Fashion Marketing, Ethical Practice and Buying
Shop Report
CONTENTS 1. Introduction...........0.4 2. The history of ZARA...........0.5 3. Target Market...........0.6 4. Marketing Mix...........0.7 5. Ethical Practices...........0.8 6. What’s next for ZARA?...........0.9 7. How are ZARA affected by the current climate?...........1.0
INTRODUCTION The brand I will be analysing is ZARA, this company was founded in 1975 by Amancio Ortega. ZARA is part of the Inditex group which is the world largest clothing retailer (BoF, 2022). There are 2220 stores in 88 different countries. ZARA has been labelled a fast fashion brand with prices ranging from £2.99-£299 and targets many different age brackets.
HISTORY OF ZARA 1 9 6 3 Ortega created a dress making factory in under the name of Inditex 1 9 8 0 Ortega changed the design, manufacturing, and distribution process to reduce lead times and re1 9 8 9 ZARA made it to the United States of America.
1 9 7 3 Ten years later he set up a factory and started a small store called Zorba, which he renamed ZARA 1 9 8 8 ZARA expanded to the rest of the country and then later in Portugal in 1988
2 0 1 0 They started an online store in Spain, the UK, Portugal, Italy, Germany, and France
TARGET MARKET The target customers for this brand are those ages 18–35-year-old adults with an interest in the latest/hottest fashion. ZARA consider their customers as middles class individuals in society. 60% of the clothes are for women, 25% for men and 15% for children. ZARA tend to be open to using both men and women models to advertise their clothes, regardless of the range they come from (UKEssays. 2018)
MARKETING MIX PRODUCT
ZARA identifies latest fashion trends and brings these to stores at a fast pace and at an affordable price. They have the newest trends for varies markets and customers, they offer products such as jeans, trousers, tops, skirts, knitwear, T-shirts, shoes, bags and accessories for women, men, and children. They make clothes to suit local cultures and people’s tastes based on the location of the store. They launch at least 10,000 new designs in a year, and new products are produced in quite small batches which helps them give exclusivity. ZARA uses ecological and sustainable fabrics like organic cotton in the production of some of their items, these products have a unique and distinct label which says #joinlife.
PLACE
There are 2220 stores worldwide, these stores are modern and luxurious looking. ZARA has their own store designers who create spacious, white looking interiors with mirrored walls and great lighting. They are usually located in quite posh/high end places. They also have an online store which is a good strategy for their growth however this is only accessible for specific countries that have a higher income. ZARA is a vertically integrated store which means they design, manufacture, and distribute their selves without help from third party suppliers.
PRICE
They create a price for the average shopper with affordable prices for high quality items, this is dependent on the location of the store. ZARA keep costs down by optimising development costs and having a vertically integrated brand, this is what makes ZARA stand out from other stores (Kala, 2018). They do not spend a large amount on advertising or raw materials which is how they follow a low pricing strategy. ZARA does not do much discounting around the year and discount sales of 50% or more twice in a year (MBA Skool Team, 2021), for which loyal consumers will eagerly wait for.
PROMOTION
ZARA varies from other fast fashion brands as they spend little on promotion. Instead, they focus on opening new stores and word of mouth. ZARA believes that its show window displays are suffice for advertisements and they do not need anything else to sell their products.
ETHICAL PRACTICES ZARA has made a program called ‘close the loop’ where customers can bring their used old garments to store so that they can gain another life. They use recycled packaging, such as paper bags and cardboard boxes for online deliveries. The brand is somewhat transparent with its customers as it shows details about supplier policies, audits, and remediation processes (Dockrill, 2022). Even though they do put these practices in place ZARA is still a fast fashion retailer and wants to keep up with all the newest trends therefore will never be fully sustainable. After reading labour behind the label, I found that ‘the wages of workers in India and Pakistan are getting stolen as factories refuse to pay a new legal minimum wage.’ As of last year, the estimated money owed to workers in Karnataka was $61 million. Showing that ZARA still have a long way to go in terms of sustainability. ZARA created the #joinlife label which is a tag on the garments that shows consumers that the product is sourced responsibly as they are made of substantial materials and made through considerate production processes (Biron, 2016). The initial goal was to have this label on 25% of the clothes however the success of the campaign has meant the Join Life label has made its way onto 35% of the total product range. All of ZARA’s stores have been fitted with systems to control their usage of water and energy to suit the individual requirements of each store (Swallow, 2021).
What is Next for ZARA’s Fashion? ZARA’s 4 key values: beauty, clarity, functionality and sustainability. After their success in 2020, ZARA has set many goals relating to sustainability, including reaching net-zero emissions by 2040, 100% more sustainable production of cellulose fibres, cotton, linen, and other materials, and becoming free of single-use plastics. I believe we can expect to see more sustainable changes at ZARA while its fashion still remains stylish and exceptional quality.
How are ZARA affected by the current climate? During lockdown online sales rise by 50% and by 95% in April. This could be bad for ZARA as they do not invest much on their online presence and website, and this is a key factor to their future success. ZARA shares information about their policies to protect suppliers and workers in its supply chain from the impacts of COVID-19 (Dockrill, 2022).
Brand Report
CONTENTS 1. Executive Summary ...........1.1 2. Marketing Objectives ..........1.2 3. SWOT analysis...........1.3 4. Marketing Analysis...........1.5 5. Marketing Strategy...........1.6 6. Resourcing and implementation Issues..........1.7
7. Marketing Control..........1.8 8. Evaluation..........1.9 9. Rebranding Package.........2.0
EXECUTIVE SUMMARY This is a brand report investigating the marketing and ethical practices implemented by the successful fast fashion brand Zara, which will be partnered with a sustainable rebranding package which will state the factors in which the brand could adapt to become a more conscious and transparent business for its consumers. I will be looking into the brands' marketing techniques and analysing what makes them so successful as well as completing a SWOT (strengths, weaknesses, opportunities, and threats) analysis to see where they need to improve in the future. The focus of this brand report will be to create a roadmap ZARA can follow in order to adhere to sustainable fashion and corporate social responsibility as this is such an important part of our industry and determines how the industry can move forward with less damage to the planet.
MARKETING OBJECTIVES “The original business idea was very simple. Link customer demand to manufacturing, and link manufacturing to distribution. That is the idea we still live by” - Jose Maria Inditex CEO since 1997. Amancio Ortega was the person that thought it was important to keep manufacturing and retailing needs to be linked with the brand, which is where the vertically integrated structure came from. It means the process of design, manufacture, logistics and distribution to its own managed stores is all managed within the company without the help from external factors (Twenin, 2020).
Zaras mission statement
“to give customers what they want and get it to them faster than anyone else.” Zaras mission statement is straight to the point, and this is a reason they are so successful as they get what they want done quickly and efficiently. The company listens to the preferences of their specific target audiences and creates fashion that they want to see in stores
The Zara vision statement “to contribute to the sustainable development of society and that of the environment with which we interact.” The statement shows the aims of the company in the future and how they put a priority on society and the environment more than it does on sales and profits (edrawmind, 2021).
S WOT Strengths
• Zara can design, produce, and sell a product in 3 weeks when in typical fashion companies this can take several months. • They take on a ‘word of mouth’ approach to marketing, instead of the standard advertisement methods, they only spend 0.3% of sales on advertising (Nazir, 2019). • Zara has the greatest number of brick-and-mortar stores in the world. • They change and update online and retail stores twice every week. • They are always one step ahead in the fast-fashion market, delivering high quality and rapid turnover times, which means they will always be successful.
We a k n e s s e s
• However, successful Zara is it will always be a fast fashion brand and with the increase in focus around sustainability, they are lacking in this area. • Due to the pandemic and the world being in lockdown retail sales dropped in the year 2020, and the brand not spending a lot on the online aspect of the business sales are down 11% from 2019 (sudhakaran, 2020). • Issues have been raised about the working conditions for the workers in Myanmar
ANALYSI S Opportunities
• They do not have to pay for advertising by using social media such as Instagram and YouTube . • Zara can respond to the demand for sustainability and increase their popularity amongst Gen z customers and 1/3 millennials (almost half the population). • Involve influencer marketing this is a great way to raise awareness and engage with an audience, 80% of marketers find this effective.
Threats
• Competition will always be a threat for Zara, especially online retailers as they do not spend a lot of their own online presence. Companies such as Shein and boohoo have been found to have many more downloads compared to Zara. • Coronavirus cases sawing could lead to another lockdown putting the business in risk of losing retail sales again
MARKET ANALYSIS s
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Zara uses demographic, geographic and psychographic segmentations in order to meet the needs of their target market, they have limited stores across the globe and within each of these stores their design change to match the cultures of the people living in the area.
Fast fashion garments are not made to last; they are made to keep up with the trends and then be thrown away. On the Inditex website, Zara explains its “commitment” to water, climate change and energy, biodiversity, sustainable materials, animal welfare, and other environmental and ethical issues (Bush,2019).
C o m p e t i t i o n
M a j o r t r e n d s
One of Zara’s main competitors is H&M, they share the same target market and strive to produce the hottest fashion trends quickly. It was Founded by Hennes in Sweden in 1947, they produce 60% of their stock in lower income areas such as Asia (H&M careers). They have 4,801 stores worldwide, which is double the amount Zara has, however at the same time, H&M has had to close some stores as many customers make their purchases online instead (parietti,2021).
Zara is always keeping up with the latest trends, this is because the in-store staff are always listening to what customers like and dislike about styles, fabrics and trends, this research is then passed back to the designers to help keep them on top of the game. They are always listening to what the consumer wants, which is a right part of their success.
MARKETING STRATEGY Swot analysis conclusion From my research I found that in order to improve Zara needs to focus on the sustainable side of their business in order to keep up with competitors and please their consumers. As well as rebuilding after the pandemic and investing in their online store and utilising the technology availableb to them. Therefore for my campaign, I am going to create a new minimal range of clothing for the brand, the pieces will all be timeless staples that can be worn again and again all year around. I want to encourage people to keep a minimal capsule wardrobe instead of buying new clothes every season to match the new FAD fashion trends. Within my campaign I want to show people the effects on the environment when producing new clothes, in particular denim jeans as these have a significant impact on the environment through dying and disposal. To do this I am creating a short video advertising the range alongside print posters to be displayed in store, the reason behind this is because most of Zara’s customers shop in-store, over ecommerce, therefore this is the most effective way to reach more people. Vision I intend to create a sustainable campaign and range of clothing that encourages people to buy less and re-wear their clothes instead of buying from the latest trends. I am going to create promotional material such as print adverts for in store, as this is a way to reach most of Zara’s customers, instead of promotion online. Risk There is a risk of people buying less, therefore the business will be making less money – however if people donate their old, unwanted clothes back, they can be sold again, increasing the profit for the company.
RESOURCING AND IMPLEMENTATION I am going to create an acquisition campaign that is intended to attract new customers to shop at ZARA as well as educating and informing them about an important topic such as sustainability. The target customers for this brand are those ages 18–35-yearold adults with an interest in the latest/hottest fashion. ZARA consider their customers as middles class individuals in society. My aim is to target this campaign at ZARA’s usual target audience as well as new customers from a 35+ age range, as it has been found that these are the people that are not as interested or informed about sustainable fashion. I want to educate this target market about the effects of fashion on the environment and encourage them to shop responsibly from this range.
EVALUATION Overall, Zara is a highly successful fast fashion brand that is keen to improve its ethical practices throughout its expansion. I believe that my campaign would be successful in strengthening the brands overall sustainability by allowing customers to consume less and re-wear their garments for a long time. The brand needs to invest more in its online presence as social media is becoming the best way to promote. This is the reason I created a video for social media in the attempt to reach more people and get the brand more InTouch with modern technology. This campaign works on Zara’s strengths such as producing hot fashion trends while being considerate of the environment by encouraging people to buy less and recycle clothes.
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