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Analyzing trends in marketing

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Contributors David Jesús Corona Mendoza José Daniel Zacarías Ramírez Xzxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxx

The magazine EBC Marketing, for which I have the pleasure to write these few lines by way of introduction, in addition to countless numbers of magazines which its purpose is to analyze the international market, unlike other magazines, this shows the students standpoint of Escuela Bancaria y Comercial, which seek to develop their professional tools. All students regardless of their year has great ideas to contribute, is precisely the purpose of this magazine, open a space where students can express their ideas and bring them to his school community in order to promote knowledge. With this thought we begin our first edition of this magazine "Where there is a successful business, someone once made a courageous decision" Peter Drucker

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When we talk anywhere in the world of Spanish clothes always comes the same name: “ZARA” Zara is one of the most famous brands of clothing in Spain and can be found on almost every continent.

Zara is the flagship of Inditex. Inditex is a fashion business group in which, in addition to Zara together, companies like Zara Kids, Pull & Bear, Massimo Dutti, Bershka, Oysho, Zara Home and Uterqüe, although relate to the world of fashion, they are destined for other niche markets.

What makes successful to Zara?

Amancio Ortega Gaona founded a company in 1963 for the manufacture of clothing but it was not until 1975 when the first store opened under the name Zara. In 1985 in the wake of the rapid spread in Spain founded Inditex, Inditex is the distribution group that involves brands like Zara, Zara Home, Bershka, Pull and Bear, Massimo Dutti, trademarks etc. The Inditex group has been the only global textile group in bill 15,946,000 euros, this success was due to its strong financial system as because based its future growth clearly, Zara put on the table their needs and targets to achieve it in a specified period, Zara invested in property, plant and tools that allowed him to develop an advantage among others

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What are the main competitive advantages?

Just in time: It is a methodology aimed primarily at reducing flow times within production as well as response times from suppliers and to customers. What does just in time gives to Zara? Gives strength because it does not lose money in stocks, Zara does not store Ătems, only produces what will sell in the short term. Another big advantage is their quality and designs clothes, this brand stays current on issues of fashion, always watching and analiszando the market, anticipating trends in fashion and to satisfy the needs of its customers.

Zara develops mini collections not throw clothes through seasons, this allows Zara to make changes in their designs and staying alert to any new style comes out, through its principles it has developed a culture of instant purchase, encouraging the consumption of their garments through return policies, lets you be selling their designs quickly and at the same time be moving goods as demand, allowing him to selling their designs quickly and at the same time moving goods as demand. Zara can make a new line, from the initial concept to when it arrives in the shops, in just three weeks.

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what makes Zara more efficient than other brands?

Zara over the years has been winning the market through quality in their designs, that has been given by their customers recognition and prestige that handles the same concept in all its stores across the world, this allows him to standardize their methods and save time and costs. Another point that distinguishes Zara is that not only seeks to satisfy the demand for youth people, Zara keeps a segmented offering through its subsidiaries allowing it to attend the children, youth and adult market. This gives a broad overview to Zara as it not only depends on a market like other brands and sales revenues are higher for Zara. With its reputation over the years, Zara always makes sure to have the best shopping in the best cities which gives a bonus to their outlets, these are strategic and the concept of the store is not only just selling but also promotion their clothes, Zara manages a concept in which its clients can freely roam the store and pick your favorite clothes and buy excess since their return policies with their customers can afford to buy wholesale

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Unlike its competitors, the Inditex group is vertically integrated, allowing you to control the entire value chain and react more quickly to what customers demand. In addition Inditex broke existing schemes so far in the field of fashion retail distribution with a fully customer-oriented value chain reverse. Inditex logistics designed to support its design and production capacity just in time with ultra-fast supply chain, giving the group brands reactivity far superior to that of its competitors. Unlike most major fashion brands, Inditex production remains very local. , 43.5% of its production takes place at its offices in Spain or Portugal companies, allowing them to supply the domestic and European market very quickly

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Inditex's competitive advantage can be summed up in three words: flexibility, speed and innovation. Its ability to provide periodically new clothing collection that reflect fashion trends and the current high demand, but at a price that remains affordable for most people, is the key to success that your competitors can not copy so easily .

â&#x20AC;&#x153;Corporate and trade strategyâ&#x20AC;? One of the cornerstones of the success of Zara is in the handling of information. The company has a team that operates internationally and is dedicated to visit malls, clubs, universities, festivals, showcases of competition and fashion shows. The function of this team is to gather information on both what the competition offers, as what consumers demand in each market, as the cultural habits of each country require a specific offer. The names of each country are in English, except Spain and New York. This linguistic chaos, next to the shops camouflage explains collusion with customers. The interior of one of their stores is classic of companies that apply just in time; little or no room for storage; all products are in sight of the customer. Thus maximizes the value per square meter, placing the shops on the main streets of the cities.

With more than 200 designers follow the latest trends in the stores at street level and the constant trips to international fairs. So, Zara designs, produces a collection twice a week, and distributes it to each store. Its collections are small and are depleted rapidly, creating the feeling of exclusivity. This avoids price cuts and urges its customers to visit their stores on a regular basis. Unlike other brands Zara advertising is more discreet in this regard. This is precisely the policy of constant renewal of the collections. Playing with longer payment terms to its suppliers against immediate it charges its customers in stores.

Business model Zara Offer clothing trend of average quality at a female audience, teen, men and children. In this same brand derives a line household items (Zara Home) that went on sale online in October 2007.

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â&#x20AC;&#x153;Barriers and obstacles faced by ZARAâ&#x20AC;?

Gap

Hennes and Mauritz ( H&M)

The second biggest clothing retailor, Gap, is American fashion retailer founded in 1969. The company has five brands: GAP, Old Navy, banana republic, Piperlime and Athleta. At the beginning, Gap's merchandise consisted of other brands such as Levi's and LPs. After Gap continuing to expand rapidly across the United States, Gap started to sell its private label products in its stores. Gap is a famous fashion retailer with a distinct marketing campaign consisting of mainly primetime television adverts which target the fashion conscious 15 to 35 age old women and men. The company operates over 4000 stores all over the world. Gap was well known for extensive collections of T-shirts and jeans which is simple but stylish. However, since 2001 the pace of development became slow due to lack of a clear fashion positioning and failing to meet consumer's fast fashion demand. More than 90% of its products are outsourced, which has meant the supply chain is too long and they have therefore a slow response to fashion. Also, Gap's core customer base has aged. Gap needs a reposition for its brand and design, but the chain has struggled to attract a younger generation to its stores. The company lacks an effective approach to deal with it. Gap is suffering from a plummet in sales and its competitors such as Zara and H&M have consequently profited from Gap's downfall. In 2008, Inditex's fashion chain Zara overtook Gap to become the world's largest clothing retailer.

Hennes and Mauritz, was founded in Sweden in 1947, is another high performing fashion retailor. Today H&M has expanded to 2000 stores acorss the world with more than 76,000 employees (H&M Annual report,2009). H&M offers similar product mix with Inditex in the same market, such as clothes, accessorise, nightwear and underwear to women, men and children. While H&M is considered as the closest rival to Inditex, there are many key differences. First of all, H&M outsourced all its production section. Moreover, H&M tends to offer prodcuts at a slightly lower price than Zara by outsourcing it production. Beyond store-based retailing, H&M also ventured into online shopping and Internet retailing. Inditex has been relatively slow to develop its online selling. However, H&M has relied almost exclusively on only one brand. Inditex has broader brand portfolio, which is made up of eight brands in order to reduce risk and refine the company's targeting of specific consumer groups

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Read more: 14 http://www.ukessays.com/essays/marketi ng/inditex-company-and-its-brand-zara-

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The challenges still facing Zara can be put into two categories: investments and time. “Zara is already a giant, and this kind of process takes a long time,” he says. “Overall, it is estimated that it will take about nine years to completely transform the chain, as well as a great deal of capital. “Once that period of time has been completed, depending on how rapidly the retail model evolves, it could turn out that this [new] concept for a store is already obsolete. This is something that Inditex will undoubtedly have to watch carefully.” Another immediate challenge for Zara: its goal to grow at a strong rate in the Asian market over the next decade. “Will consumers in that market be in favor of paying a bit more for other designer labels?" he wonders. According to Costa, the United States, which is also a target of Inditex, represents another challenge because it is a country of designers and fashion. "The New York store is [worth paying attention to], because what works in that city is The Gap, whose clothes are a genuine clothing commodity. It is very doubtful that [Zara] will enter the U.S. and compete against The Gap on the basis of price. [If I were Zara] I would differentiate myself on the basis of design.”

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On the other hand, Zara is starting to operate on all five continents, so they are duplicating their collections and dealing with the resulting challenges that this involves for logistics, which is one of the strong points of their business model. This means that when it is summer in Europe, “Zara needs to be making its winter collection for Argentina. To get to Asia, the United States and so forth, its model [which involves] continuously replenishing its stock, leads to higher costs. Or they can reduce their agility and move toward a model that is more like that of H&M” which involves less frequent replenishment of its inventory but lower costs. “Or maintain their excellence at worldwide logistics in two seasons, even if that will mean higher costs.”

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