This paper will study the Spain-based retail establishment ‘Zara’, located in Washington DC. It will examine its market position, marketing strategies, physical facilities, and people’s management of the operation. Zara is a world renowned fashion brand known for its efficient production of trendy and high-fashion clothes for both men and women. Zara is a leading Spanish Flagship Chain Store that deals in Women and Men’s clothing.
It opened its first store in 1975 and since then has taken retail fashion by storm.It is one of the largest brands, by the Inditex Fashion Retail Group, that has 723 stores in 56 countries making sales of Euro 3. 8 billion (India Supply Chain Council, 2006). Zara’s fashion is based on imitation; it copies designs from the catwalk and other spots and brings them to their customers at low prices in as little as a couple of weeks.
Zara’s average customer is aged between 15 to 30 years of age. They are fashion-focused and have a desire for high-end fashion. The average customer is an urban woman who is not necessarily exceptionally wealthy and looks for trendy clothes in reasonable prices.Zara’s position in the retail market has always been a leading one. This year was no different. It increased profits by expanding to into more territories.
It holds a stronger position in the fashion retail industry than many other foreign labels. In the US, Zara has a total of 24 stores. Despite this, the market here is weaker for Zara than the market in Europe. Zara, has a very high product turnover. It makes more than 11,000 products annually.
Zara opened 138 new stores during the past year, increasing its selling area by 15%.Zara’s typical store is a principally white, modern and spacious store; it is bright and has mirrors for walls. The stores racks are draping with the latest fashion. A long line of people is usually seen at the cash register (India Supply Chain Council, 2006). Mostly all Zara stores this year have introduced toilets and changing rooms for the disabled and even separate areas for the disabled have been made where they can pay for their purchases.
The store in Washington, however, had very poor lighting, especially in the dressing rooms.Zara’s stores are located in places that are generally busy and prominent and nearer to cutomers. High-status city centre shopping streets are the perfect example (India Supply Chain Council, 2006). Zaras’s product line mainly consists of a menswear line and a womenswear line. These fashion items are highly fashion-oriented and trendy. This product range is continually updated and any products (couple of) that do not do as well are taken off the shelves.
Zara’s range only has clothes that are on the runway. It aims to bring haute to the public.One of the most striking features of Zara’s fashion is that it generally produces clothes at low cost. However, Zara's pricing is different across different countries markets. It sets its prices according to the conditions in those markets and unlike other retailers in the industry, its does not use the cost plus margin system of pricing. An example of different prices across different markets is exhibited in the following sentences.
In Spain, Zara products cost less, while in the US, Japan and Mexico, they are priced as extravagant fashion items (India Supply Chain Council, 2006).The pricing in the Washington outlet was very high. Zara’s visual merchandising is remarkable. The windows are displayed differently vibrantly every few days, as decided in the head office.
Other than that, items are divided separately for men and women and are size and style coordinated. The racks, however, are stocked very randomly. Zara has excellent customer services. Employees are fully trained with special emphasis on customer services. At the same time, the freedom of the customer is maintained. Fixtures and fittings are put in such a way as to stop any sort of interference for the customer.
Complaints or any sort of suggestions are taken in the store by the store managers (Inditex Annual Report, 2007). In the Zara outlet that I visited, the customer service was on the lower side. As far as marketing strategies go, Zara markets its products only through changing its displays on the windows continually and by constantly and dynamically providing newer items every week. Customers look forward to going to Zara stores because they expect to see new products each time.
As far as advertising is concerned, Zara believes in ‘zero-advertising’.Its advertisement budget is extremely low and like many other retail stores, it does not adopt celebrity-advertising or any of that sort. The Human Resources aims to recruit a workforce of the most appropriate size, qualifications and flexibility. The department has developed a periodical training program for its staff and has combined quality in the performance of their tasks by the employees and the satisfaction they may obtain at their workplace. The department also encourages workers to exchange jobs so that they can gain experience as well as expertise in different areas and departments.Information is freely floated through all these areas so no meaningful data is concentrated in one area.
In addition, the staff is trained and developed with the use of professionals. (Inditex Annual Report, 2007) In conclusion Zara’s strength is that it is dynamic. It brings new items to the shelves in as little as two weeks. It does this though its extraordinary communication channels that cut down on production schedule time.
It also buys directly from the suppliers and brings it straight to the fashion house (Safe G. , 2007).It’s secret lies in having complete control over each and every part of the store. The employees of the store and office are in contact always. It advertises by changing the displays on its windows and it feels that this is enough advertising.
Because it brings out items in such little time, customers keep anticipating them and visit stores even more often in the hope of finding something new. This, fortunately works for them. My recommendation to enhance the retail experience in the US is to work on customer services and a little quality. This is sure to get it its market position in the US market.
