Market case workshop
By Viviann Hua
Zara Inditex The objective for this proposal to expand Inditex name, seek different mediums for advertisement, and create new way to make the shopper experience at Zara an unforgettable one. Zara became the fastest growing retail chain store, by the end of 2011 their profit risen up 10 % and now is operating in 5 new markets. Zara makes up 64.8% of their sales contribution making them the biggest contribution to their parent company Inditex. Zara first opened in 1974 in the downtown center of Galicia, Spain it was such a big success in Spain that it started to expand throughout the country. With that throughout the 80’s and 90’s Zara expanded internationally entering new markets like the U.S., South America, and Europe. As of today Zara is the fasting growing Retail Company, this is accomplished by their way of manufacturing and distribution. Zara receive new items in their stores every two weeks which this why they are called “ fast fashion” compare to another retail stores where it takes them around 6 months to get in new products. I have worked at Zara for about 2 years now, I learned a lot about the company and the people who run it, for me what interested me most about this brand was not for the fact I work there, or the way they make and distribute their products but how they market themselves. Surprising enough Zara doesn’t do any type of advertising; well I mean not traditional ones to be exact. While a normal retail company spend around 20% of their money on marketing and advertising each year, Zara only spends around 0.3% a year, to me that was amazing, Zara is out beating all other major companies such as Gap, H&M, United Color of Betton, and TopShop. It really intrigues me that with no advertising, no awareness, and no traditional marketing, how did Zara gets so big? When I started this case study I found out that I wasn’t the only one that was amaze about their non-traditional sense of marketing, Zara made a name by doing that meaning; no advertisement, for this they were the talk of the town in the fashion world. Even though they didn’t do much print work, television commercial, or even ad campaigns, but they did have strategies on how they wanted to market themselves, one of those ways is location. Location played a big role in Zara brand awareness, Zara spend a lot of money on the perfect location for a new store. They purposely locate themselves in areas with heavy traffic and are high-end avenues where they will place themselves near stores like Chanel, Gucci, or Prada.
(Zara Flagship store in New York,NY in 5th Ave and Zara in Australia ) Other ways that Zara advertisement themselves is through WOM (word of mouth), celebrities, online website, and with the raise of social media they now have a twitter, Facebook, Instagram, and Pinterset account. In a way they paved themselves into doing the same things other companies are doing when it comes to social media but Zara has not done any other type of advertising. For me I feel that it is true that Zara is doing amazing, they’re revenue are raising, they are opening new locations, and venturing into new markets but I wonder how strong is their brand presence will be without much advertisement. With new brands emerging everyday and with older brands exposing themselves to the public, how can Zara persevere. So for my case study I want to explore different alternative on how Zara can make a stronger brand presences, without doing traditional advertisement. There are three Zara locations in the Chicago land area, two of those locations are located in the heart of Chicago and the third location is located in the outskirts of the city in a well known suburban mall called Old Orchard mall in Skokie, IL. The Skokie location was the first Zara ever opened in the Chicago land area and it’s the location that I am currently working at, working at Zara I have many insights on how the company works from the mangers, cooperate visitation, and also the visual display team. For this project I conducted an interview with the store manger and assistant manger about Zara as a whole. Before my interview I knew what I wanted to find out about Zara, I wanted to know more about Zara advertising strategy, what is Zara demographic, how closely does Zara sales associate work with corporate, and if Zara had any future plan for branching out into other medium of advertising. From what I got from them is Zara is • • • • • • • • •
Fashion made ready They make limited supply of manufacture Track their success by how much they sale a certain garment Ranging from women, men, and children clothing Corporate visit every Zara location monthly Corporate work with the management at that certain location with their coordination. Branching out in other forms of advertisement Relays on their visual display as a form of advertisement They don’t give celebrities free clothes to wear
The interview helped me understand that one of the key ways Zara exposed themselves is through the visual display for their windows and the layout of the store. I thought about it for a second, about what they said about the visual display being a key role in their advertising strategy, and to be honest it was true. Having no advertisement will have some benefits but it will definitely have it share of drawbacks. One of those drawbacks is a lack of brand awareness and a lack of reach. I have been told many times by people that they never heard of Zara, as one of my friends state â€œ what is Zara, sounds too weird for me â€œ I looked at what their competitors are doing with their marketing strategies, I found that Spanish retailer MNGO spent a lot of their time and dedication on advertisement/ events. MNGO collaborate with celebrities like Mila Jovich and Penelope Cruz, also they host many fashion events to showcase up and coming young designer as well as having their own blog to communicate their current trends and fashion to consumer. For H&M a lot of their advertisement go to commercial, celebrity endorsements, print, out of home, and digital media. Zara seems to be going in the right path, I for one am someone who is out there to look for new ways to grow and for Zara that is what I think they need to do. For one of my suggestion is to engage potential consumer and draw them into Zara. As I said before Zara main drive for advertisement is their visual display windows, so if that is the case why not amp it up. Zara window display consistent of mannequins and the garments/collection, Zara change their display in every three months but change the layout of their store every two weeks. One of my suggestions is to change the pace of the store, you wouldnâ€™t think that something so small as music or lighting can effect a store but it can. I would suggestion changing the pace of the music, maybe something more of a line of upbeat rather than slow and mellow. Another thing I want to suggest is the visual display, I think that if Zara made their visual display windows more present than it will create more buzz for the store. Incorporating with the display design of their visual display, I wanted to add another element to it, which is digital or even video projection. Including a backdrop of Zara collection video showing will get people engage and notice the store more. Also with the elements of upbeat and fast pace store it will go with the sleek new style. My second suggestion is to become more active in social media, interactive advertising, and also to be part of this growing world independent trendsetter. Even though Zara never made an effort to do traditional advertisement but they did enter the social media aspect of it includes Facebook, Twitter, Instagram, and Pinterset.
One thing that I also found out during my interview is that Zara is trying to embark on a more urban/ street style to their brand image, which comes to play their People! Campaign. The People! Campaign is way for people who love fashion and people who love Zara have a way to showcase their style. With this they can upload their picture through their People! Account and who ever win get $300 for the collaboration.
I wanted to expand this concept of street style or the people being the voice of what is trending now, rather than what the top designer says what is in or what is not. I would like to see Zara collaborate with fashion bloggers, up and coming young designers, and also not just focus one entity of Zara but to focus on Zara globally meaning not just images of people wearing Zara from the U.K. or the U.S. but in South America, Asia, and the Middle East, showcasing Zara international appeal through these social media outlets. I would also let consumer get more knowledgeable about Zara, for this I feel social media platforms are great but maybe more insight about the interworkingâ€™s of the brand like sneak peak of the concept for new collection, early alerts of anniversary sale, and reviews on garments from costumers. Zara having their own blog or own view window about fashion, will draw people to see what is trending, with this we can incorporate Zara People! to be part of this platform too.
For the short-term cycle for this case, is to have new outlets of advertising, by doing this we can capture new consumer and get them into the stores. I want Zara to leave an impression to consumer once they walk into a store, I want consumer to feel as if they are in a high-end designer store but with affordable prices. As for long term cycle I wanted Zara to have more brand presences and by using social media platform and incorporating them with user generated content will be able to get more consumer engage on what is trending in Zara, as well as collaborating with fashion bloggers and Zara new content Zara People! will give relatable and hip presences to Zara. At the end of this case I learned that you could always find in number and facts about a brand but you, yourself have to find the answer, through your own interpretation and what you want to get out of this. I wanted to get a sense of expanding myself as a marketer as well as showcasing my side of telling a story and what I can do to continue the story, I learn that there are always new finding in a already established entity, I learned that I myself is someone who loves visuals and that I am very passionate about sending as message to everything I show. I learned at the end of this project is that I am someone who loves to coordinate, plan, and organize a purpose. I had a wonderful time working on this case and looking forward to many more as time goes by.