Zara Case Study
3.1 HISTORY and BACKGROUND ZARA is the flagship chain store for the Spanish Inditex Group owned by Amancio Ortega, who also brands such as Massimo Dutti and Bershka. It was first open in 1975 in La Coruna, Galicia, Spain. Originally a lingerie store, then the product range expanded to incorporate women’s fashion, menswear and children’s clothes (5).
The international adventure began in 1988, opened its first foreign store in Oporto, Portugal. The market growth remained mysterious and it kept growing the stores in different countries and its cities. Started from the United States (1989), Paris (1990), Mexico, Belgium and Sweden (1994), Malta (1995) and Cyprus (1996). The stores remained company owned, however, it started to make another expansion through franchise when they enter the Asia such as Japan (1997). By the year of 2004, Zara has 1058 stores located in 68 countries around the world, and the 792 international stores generated 54 percent of group sales. Today, Inditex is the world’s fastest growing retailer and Zara described as the most innovative and devastating retailer in the world, by LVMH fashion director Daniel Piette (6).
3.2 BRANDING MANAGEMENT
Zara’s success is as much a result of its history and location, as of its counter-intuitive business strategies. Zara is riding two of the winning retail trends-being in fashion and low prices-and making a very effective combination out of it. Design and product development is a highly people-intensive process.Information and communications technology is at the heart of Zara’s business.Four critical information-related areas that give Zara its speed include:
• Close watch on trends & buying behavior
• Quick decisions
• Inventory Control
• Distribution
3.2.1 Zara’s Marketing Strategy Zara’s marketing strategy focuses on product variety, speed-to-market and store location. Zara does not advertise in the traditional sense. Zara puts 10,000 different items on the store in a single year. If Zara
The international adventure began in 1988, opened its first foreign store in Oporto, Portugal. The market growth remained mysterious and it kept growing the stores in different countries and its cities. Started from the United States (1989), Paris (1990), Mexico, Belgium and Sweden (1994), Malta (1995) and Cyprus (1996). The stores remained company owned, however, it started to make another expansion through franchise when they enter the Asia such as Japan (1997). By the year of 2004, Zara has 1058 stores located in 68 countries around the world, and the 792 international stores generated 54 percent of group sales. Today, Inditex is the world’s fastest growing retailer and Zara described as the most innovative and devastating retailer in the world, by LVMH fashion director Daniel Piette (6).
3.2 BRANDING MANAGEMENT
Zara’s success is as much a result of its history and location, as of its counter-intuitive business strategies. Zara is riding two of the winning retail trends-being in fashion and low prices-and making a very effective combination out of it. Design and product development is a highly people-intensive process.Information and communications technology is at the heart of Zara’s business.Four critical information-related areas that give Zara its speed include:
• Close watch on trends & buying behavior
• Quick decisions
• Inventory Control
• Distribution
3.2.1 Zara’s Marketing Strategy Zara’s marketing strategy focuses on product variety, speed-to-market and store location. Zara does not advertise in the traditional sense. Zara puts 10,000 different items on the store in a single year. If Zara