Zara case study analysis.
As you know, there are endless options to choose from when it comes to clothing and fashion accessories.
This is why to be successful, a clothing brand needs to be on their toes all the time to catch the consumers eye.
Zara is a world renowned brand in the clothing and fashion industry.
Zara has placed itself among the best of the best by offering the latest and trendy clothing with top notch quality at affordable prices, making it the most profitable clothing brand among all of its competitors.
Zara is a part of its parent brand Inditech, which is a company based in Spain, whose founder is Mr. amancio Ortega. He also happens to be one of the wealthiest people in Spain in the list owns multiple fashion brands, and it is the biggest clothing company in the world having over 7490 stores and operating in 200 in two markets worldwide. Zara was founded by Mr. Ortega as a flagship of Indy Tech's in 1974. In Spain, under the name Zorba later changed to Zara.
Zara is the most profitable among all the other brands owned by indie Tech, and it contributes an estimated 80% of the total revenue of Indy Tech's the industry, the public, and even Mr. Ortega's competitors have often appreciated him for his bold and strategic business decisions, which has led to the success of his company.
The most prominent reason for the accomplishments of Zara is that it keeps up with the rapidly changing trends in fashion, and offers quality clothing at reasonable prices.
It has proven itself since the beginning, and has earned the trust of the customers through some bold entrepreneurial decisions by introducing new designs into the market every two weeks.
In contrast, it takes other brands at least six months to incorporate new designs in their arsenal effectively. Mr. amancio Ortega shared his unique viewpoint by calling clothes a perishable commodity, implying that people always want fresh clothing choices. Soon after this, the phrase freshly baked clothes was adopted for the clothing range by the brand to signify the changing nature of the fashion world.
Such poor decision making for business requires extensive external and internal analysis in the form of SWOT and pestle to ensure feasibility, and to set objectives and goals. The mission and vision of a company plays a vital role in telling the world about the long term goal and social practices of the company.
Zara is recognized as one of the most eco-friendly companies in the world. its headquarters in Spain produces most of its energy through the use of solar panels and wind turbines. It is also one of the only few clothing brands that produce clothes that are 100%, free of toxins.
Another impressive feature of Zara is that they have always relied on word of mouth marketing from satisfied customers. They have only used the marketing tactic of displaying their latest designs in the windows of their stores to attract new customers to present an analysis of the external influencing factors of Zara.
Let us now have a quick look over his pestel analysis. The political conditions for Zara in Spain are quite favorable and allow for smooth business transactions. Since the beginning, Zara has always dealt in a single currency.
Thus, it has been successfully getting its market share and is unaffected by the recession. Spain has a rich artistic and designing heritage.
Thus, it has a significant influence over Zara due to the peaceful social environment and vibrant cultural events. Tourism has enabled Zara to attract more customers along with their various collections and low prices.
Zara has adopted an environmentally sustainable technological approach In its sales and manufacturing process by making its stores eco friendly, and using a mix of labor and automation in its manufacturing by having its assembly done by the employees.
The rules and regulations of the Spanish government support the industrial development of the country, therefore, allowing Zara to flourish. Environmental Sustainability has always been a priority for Zara.
Therefore, the company is looking for new ways to adopt more eco-friendly business processes.
The major strengths of the company are its motivated and committed employees and the setting of attainable objectives through rational and practical decisions, which gives Zara a competitive edge.
The absence of new marketing approaches and promotional efforts is one of the major weaknesses of Zara, as it can lead to a communication gap between the consumers and the company. Zara still has various potential markets that have previously been untapped by the company by expanding in new markets, and segmenting their product line into a specialized range is an excellent opportunity for Zara.
Zara faces a threat due to the oversaturation of the market because of the different companies and fluctuating exchange rates. After analyzing the internal and external factors, a few strategic options present themselves in front of Zara to increase their productivity in the future.
In the past, Zara rejected employing a cheap outsourcing concept in efforts of ensuring quality, but the company must now allow the process to explore new areas and conquer the global market. While the environmental achievements of Zara and the Inditech group have been rewarded, the benchmark set by the company has also been targeted by their competitors.
Therefore, in efforts to increase communication between the stores through customer feedback, and the designers in Spain, salesperson salespersons have been allotted burstner Digital assistance to make this process more fluent and address the market needs.
It is now high time that Zara now brings evergreen fashion choices in its arsenal. As there is a large population of consumers in the market who are looking for quality clothes that stay in fashion for a long time and are always available in stores. Zara has been performing all its business operations through its headquarters in Spain.
Zara could face severe challenges while implementing any of the previous strategic options which are available to them to execute any of the available opportunities. Zara will lead management with skilled individuals. As the company has expanded to a larger scale.
The founder Mr. Ortega has successfully implemented many business decisions. However, while venturing into new markets, Zara needs a unique team of skilled members. for effective human resource management.
Zara needs to address its workforce diversity among its employees to avoid any aggravation in the future.
Zara does not have many distribution channels, which could lead to supply chain management issues while entering a new market. In conclusion to this analysis, we can say that Zara has been able to beat the competition and attain leadership through these strong and bold choices made by their founder.
This provides Zara a reliable Foundation, using which they can build further strategic initiatives to maintain growth, which is the most urgent need for the company.
The company can implement any of the mentioned strategic options in an organized manner.
However, extensive research and analysis of the options will be required to be performed by the company before execution. So with this, we would like to end the Zara case study analysis.