Carolina Ginorio - Isabel Jimenez - Margarita Leano - Francoise Urdaneta
01
Company Profile
SWOT Analysis
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02
Mission
Competition
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03
Scope & Size
Trends
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04
Brand Mission & Identity
6 Month Buying Plan
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05 06
Target Market
Lifestyle Trend
Assortment Plans
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Opportunity Statement
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Company Profile ZARA is a Spanish clothing and accessories brand based in Galicia, Spain. It is a top leader in the rapid development of fast changing fashions internationally. It first opened its door in 1975 in the city of Coruna, Spain. It offers lower price, higher-end and popular fashion. Their customer is at the heart of their unique business model. This includes design, production distribution and sales though an extensive retail network. It was not until 1989 that Zara entered the USA in the city of New York. Founder: Amancio Ortega Parent company: Inditex, the world’s largest apparel retailer. The group also owns Pull&Bear, Massimo Dutti, Bershka, Stradivarius, Oysho, Zara Home and Uterque.
Mission “It is Zara’s mission to give their customer an exclusive choice of fashion that is innovative in its products to enhance the shopping experience and provide new designs at affordable costs made from quality materials which follow the latests trend.”
Business Model Zara maintains a low risk of fashion mistakes by constantly bringing in new merchandise twice a week. They keep a low stock so customers know that you must buy it now or you will never see it again. It strives because of its good positioning of stores in major cities, while catering to each of the local tastes. Also, Zara decided to invest more money on their flawless brick and mortar stores, rather than on advertising.
Brand Identity Zara is one of the largest fast fashion retailers in the world. It’s strategy consists of presenting luxury-like products at a mid-range price. Creativity, flexibility, quality design, and rapid turnaround are all part of its approach to expand internationally at such a fast pace.
Scope and Size
2,000 Stores Worldwide 88 Countries 69 Stores in the US $12.6 billion Sales in the US $20.9 billion Sales in total
Links zara.com Website
24,676,418 Likes Facebook.com/zara 14.3m Followers Instagram.com/zara 1.19 Followers Twitter.com/zara
The Ideal Zara Target is ... *Willing to pay a slightly higher than budget price but lower than luxury. They come from both ends of the spectrum; the budget consumer sees the items as a splurge while the luxury consumer sees the item as a bargain.
Price conscious and highly sensitive to the latest fashion trends. Usually geographically located in urban or slightly suburban areas. Willing to accept that in spending less they remain able to be relevant to the higher class. 60% are women, 25% men and 15% children. They prefer Zara from other fast fashion retailers because they know not everyone will be wearing the same thing as they are because Zara maintains a low stock quantity on items. Educated, middle to high class including students, young professionals, and young families.
They come from different cultural backgrounds, but they all share the same interest in fashion.
Meet Sophia ... Age: 24 Location: New York Education: B.A. Pharmacy at NYU Occupation: Student Salary: Family money, $90k Status: Single VALS Profile: Experiencer Psychographics: Very tech savvy while also enjoying outdoors. She shops at Whole Foods to stay healthy, does yoga, bakes, loves to travel, listens to pod-cast and read blogs for constant trend update.
Lifestyle Trend
Generation of Millennial shifting to the professional stage They seek ACCESS to every trend, without wanting the OWNERSHIP of it. - They don’t want to spend high amount of money on items they want for short-term, since they are constantly experiencing different trends, also because they are receiving their first paychecks and don’t want to spend it incorrectly. They want MAX. CONVENIENCE at a LOW PRICE. - And because they are always Online, they can compare prices and get feedback on items., finding exactly what they are looking for. They are a BIGGER GENERATION, with a SMALL WALLET - Bigger than the baby boomer, yet many of them were raised in a lower employment level, small incomes,and loans for college tuition. Hence, quality is key, but PRICE is more important. They prefer to EXPERIENCE and travel, consequently they rather spend more on experiences and new trends and less on expensive products.
KEY WORDS:
Trend Seeker Active workers Willing to work extra hours Skilled in tech Self-confident Multi-task High expectancy Always seek challenge
Strength - Wide variety of trendy products at affordable prices - Global outreach: 2,000 stores - Strategic locations with stores in big cities - Minimalist store image - Business model: see it, buy it in the moment - Fast changing collections, new merchandise bi-weekly - Efficient distribution: they have their own factory which is they center of the whole distribution process - They have access to technology that gives them information they need to be ahead of competition in trends
Weaknesses - Lack of marketing - No constant social media presence
Threats - Fierce competition from other stores, globally and locally - Lawsuits related to sweatshops - The harm of fast fashion to the environment - Economic changes and slowdowns
Opportunities - Collaborations with well known designers - After opening “Join Life�, their sustainable line for clothing, they can also start to use sustainable materials for the accessories line - Since their main distribution center is in Spain, they can also open another distribution center in the US - Hosting shows and events for promotion - Applying technology in their physical stores such as virtual mirrors, self-checkout & ipads in dressing rooms - Growing Asian market
PRICES
QUALITY
Brick and Mortar H&M: It has five times the number of stores and a bigger Online variety, offering two thousand more options than Zara. ALDO: Offers very competitive prices on all their products. STEVE MADDEN/NINE WEST: They are as fashion forward as Zara. With their main focus on shoes and bags. If customers don’t find what they want in Zara, they will go directly to one of these stores. UNIQLO: Has technology incorporated in their brick and mortars, attracting more costumers.. It also has a styling and fitting advice chart in their fitting rooms while ZARA doesn’t have any of these. TOPSHOP: Has a greater costumer feedback, reviews, and a better social media presence. It has better business credibility and trustworthiness. MANGO: Less variety of products but same style as Zara. Commonly same customers.
Online NASTY GAL: It has a larger social engagement than ZARA. It is a go to Online store for customers who don’t like to shop at brick and mortar stores. ASOS: Social engagement has grown noticeably with a 3.1% more than Zara in the past 3 months. Even though ZARA has a larger social engagement than ASOS, lately, ASOS’ audience has grown noticeable: 3.1% more than ZARA in the past 3 months. TOBI: If customers are looking for bags/shoes, TOBI is a GO TO Online store for customers who don’t like to shop brick and mortar as well.
HARD/BOX CLUTCH - Decorated and embellished - Mostly square-shaped - Materials: exotic leathers, acrylic, and metallics - Strong color stories
HOBO BAG - Casual silhouette - Bold solid colors - Slouchy shape that makes it an easy-wear
OVERSIZE BAG - Oversize silhouette - Simple style of the Clutch and the Tote XXL - Material: soft leathers - Statement piece - Minimal design/Maximal proportion
MINI CROSS BODY - Over embellished - Decoration includes trims and statement hardwares - Diverse silhouettes
STACKED SANDALS/HEELS - Stacked soles - Decoration includes big buckles, lots of straps, and embellished soles - Retro inspired - Chunky sport sandals with thicker soles
SANDALS - Thong and thin strap sandals - Focus on ghillie lacing and laced-up ties
EMBELLISHED SNEAKERS - Use of furs, beading, and statement hardware - Balance between sport-driven styles and feminine aesthetics
DECORATIVE SLIDE - Simple designs adorned with different appliquĂŠs - Decorations include leather pieces, beading, and trims - Easy to wear
Corporate plan: -Zara in the US is expected to makes $112500.0 -Since it is such a big company and it is a fast fashion retailer which means they are constantly changing the merchandise, selling out and getting more, which is why the turn over rate is higher than a lot of stores. -There is a constant balanced flow of receipts that only spikes up a little during the month of June which is the month of the annual sale. -Since Zara is a fast fashion retailer that has low retailer (mid-range) prices, they keep their makeup percent high enough to do sales, but not too high to loose money.
New York 52nd St, 5th Ave. NY
- The plan net sales are $6500.0 - New York’s inventory turnover is at 4.7 which is more than an average Zara store makes in the U.S. This is because this store is the biggest in the U.S., it has a great customer flow and it is located at the center of one of the busiest cities in the world and one of the fashion capitals. - There’s a higher plan reduction in June because of their famous annual sale.
- The plan net sales are $3260.0 - Miami’s inventory turnover is at 4.2 which is more than average Zara store makes in the U.S. but less than New York. This is because this store is located at Lincoln Rd. which is one of the most popular shopping spots in Florida. - The flow of receipts is higher during the months of February and March because it is when most tourist from cold weather enviroments visit Florida and sales are expected to go up.
Miami Lincoln Road, Miami, FL
Shoes: - Planned purchase retail for bags and shoes is a $135,000,000 - 60% of the planned purchase retail goes towards the shoe category. - 60% equals $81,000,000 - The 60% would be divided into 4 shoe categories: stacked shoes, embellished sneakers, sandals and the slide.
Handbags - 40% of the planned purchase retail goes towards women handbags category. - 40% equals $54,000,000 - The 40% would be divided into 4 women handbags categories: mini cross-body, huge shopper bag, hard box clutch and slouchy hobo.
Opportunity Zara is a huge business that still has a lot of space to grow. Their accessories department is underdeveloped with a lot of opportunity for expansion. A good example of how they are slowly bettering this department is by trying to improve the overall quality of their product; they have begun to develop their accessories line by incorporating leather. This is a decision that improves the overall value and quality of their products. Additionally, having a good variety in the accessories department gives customers an open option to complete their look by buying their shoes and handbags at what has slowly become a one-stop store. One very positive side about this development is that Zara is a fast fashion retailer, which means that if the department in general or a specific trend that has been brought in is not working, it can be out of the store in a second because of Zara’s low risk business plan. This department is small for now but there is a great opportunity for shoes and handbags with an end goal for the accessories department to take over 20% of the business and raise their profit in the near future.