Business and Management - Zara
Added on 2021-02-19
36 Pages10832 Words66 Views
DISSERTATION (Business and Management)
ABSTRACTBrand loyalty can be defined as a feeling or attachment which a customer have with aspecific brand which compels it use the products and services of that brand irrespective of anychanges in the market. The research project is about analysing the influence of brand loyalty onthe sales and profitability. There is no doubt that possessing a sound and strong loyal customerbase is considered as a competitive advantage for a company that puts it in a position of earninghigher profit margins than its competitors in the market. In the report, primary research isconducted which has thrown lights on the factors such as convenience, meeting the expectationsof the customers, personal relationships with customers and rewards must be considered by themanagers of the ZARA for maintaining and strengthening its brand loyalty. The report further highlights the methodology for conducting such primary research.Like, the scholar has applied qualitative research methodologies in determining the solutions tothe problems of the research study. The report has included a part of recommendation in which ithas suggested the managers of ZARA regrading how can they improving their brand loyalty forprogressing further in the market. These recommendations include offering value andphenomenal customer experiences as such things would help the company in increasing itscustomer engagement which in turn would result into creation of brand loyalty factor amongstthe customers.
Table of ContentsTITLE:.............................................................................................................................................11.0 INTRODUCTION.....................................................................................................................11.1 Identify a specific researchable topic area.............................................................................11.2 Establish the importance of the problem...............................................................................21.3 Aim of the research project....................................................................................................32.0 Research Objectives and Research Question(s).........................................................................3Research Objectives.....................................................................................................................3Research questions.......................................................................................................................33.0 Literature Review.......................................................................................................................3The concept of brand loyalty.......................................................................................................3The impact of brand loyalty on sales and profitability of ZARA................................................4The factors which has to be considered by managers of ZARA for maintain its brand loyalty..5Recommend the ways through which brand loyalty of ZARA can improved.............................64.0 Methodology..............................................................................................................................64.1 Research Design, Research approach and Research Type.....................................................64.2 Rationale................................................................................................................................94.3 Significance..........................................................................................................................105.0 Access to Data and Research Ethics........................................................................................106.0 Limitations...............................................................................................................................10LITERATURE REVIEWS............................................................................................................11RESEARCH METHODOLOGY ..................................................................................................14Research type:............................................................................................................................14Research approach:....................................................................................................................14Research Design:.......................................................................................................................15Research Philosophy:.................................................................................................................15Sampling:...................................................................................................................................15Data collection:..........................................................................................................................15Data analysis:.............................................................................................................................16Ethical Considerations:..............................................................................................................16
Research limitations:..................................................................................................................16Time scale..................................................................................................................................16DATA ANALYSIS........................................................................................................................18CONCLUSION & RECOMMENDATIONS................................................................................26Conclusion.................................................................................................................................26Recommendations......................................................................................................................26REFERENCES..............................................................................................................................28
TITLE:“A critical analysis of consumer's brand loyalty on sales and profitability of businessenterprise.” A case on ZARA.1.0 INTRODUCTIONBrand loyalty refers to understand the tendency of consumer's preferences to buy productand avail services on regular basis. Brand loyalty is important because it helps to compete withother parties in industry. In order to make good brand image, it is important that consumers areready to buy their products (Alhaddi, 2015). Consumers are the main asset for growth anddevelopment of business. So it is important to keep them satisfied in order to get success inindustry. When consumers are ready to purchase product frequently, then it is important toregular improve quality and features of products. Thus, present research is based on ZARA company which was founded by AmancioOrtega and Rosalia Mera in 1975 and they are specialised in dealing in clothings and bagsproducts. As ZARA is one of the leading brand in fashion industry. ZARA is Spanish Fashionretailer in Arteixo Spain. Its parent company is Inditex. ZARA has good brand image becausethis provides god quality products within affordable prices. This organisation has goodemployee's strategy through which work force is satisfied and they give their best to deal withconsumers. Present research is based on the topic relating to brand loyalty which means a truston brand which is to be maintained by the consumer for longer time period and also it is mainlyengaged by most of the company to maintain their brand loyalty among consumer for futuregrowth (Sung and Goebel, 2018).They carry a strong brand image in market and also usedifferent strategies to attract the customers towards their products for longer period. They designsuch products according to the needs and demand of such products and also bring in market withstrong techniques to attract the interests of customer towards their products.1.1 Identify a specific researchable topic areaResearch is conducted on brand loyalty. This is the topic which is important becausethese days, there is much competition in retail sector, so in order to achieve competitiveadvantage, it is important to create brand loyalty. Brand loyalty is the topic which helps to getsuccess in industry with easy growth and development. Hence importance of this topic is tounderstand impact of consumer's brand loyalty on business sales and profitability. With this1
topic, it is easy for researcher to understand policies with which long term relations can bemaintained with consumers. As there are many organisations which are dealing in fashion retail sector such as Marksand Spencer, Charles, etc. Hence there is competition in market. For instance: as compared tocompetitors, dresses of ZARA are expensive, then consumers may shift to other brand. This hasimage on consumer brand loyalty and sales of association in negative manner (Basile and Faraci,2015). When operations are not performed in ethical and reliable manner, then this affects brandimage in negative manner. These days, marketing is the best tool through which feature ofproduct and services can be launched in society. Hence, advertisement not manipulating actualproduct and services. These days, there is use of social media sites for advertising in new andinnovative manner.1.2 Establish the importance of the problemIn case of ZARA, there is issue in brand image of organisation because they areconsistent to their policies. This affects performance of overall organisation as compared to otherenterprises in industry. Brand images of ZARA is not good in current years. This is because ofchange in trends and managers of ZARA are not able to plan these changes properly. They arenot accepting change in trend which is the biggest issue of drop of sales (Batkovskiy and et. al.,2016). Sales of ZARA is not dropped down by one third in 2016. Sales gets down by £58.3 to£39.2 million. As per research, it is identified that they are paying dividend of £30.5 millionwhich is low as compared to £47 million in 2016. This is the issue faced by ZARA in currentyear, so there is reduction in their consumers. But sales is increased by 13% to £602.7 million.This issue affects performance of ZARA in industry because employees, shareholders, etc. maywithdrawal their consent to perform activities. With reduction in profits, employees may getdissatisfied and they do not want to continue with ZARA. Same with shareholders, if share valueis going down, then this affects performance of overall company (Zara's UK profits drop sharplydespite record sales, 2019).With conducting this research, it is easy to plan ways through which sales can beimproved. As role of, angers is important to maintain and improve brand image. With increasingbrand image, it is easy to improve brand loyalty. So this topic is best and reliable as per currentsiltation of ZARA and market trends.2
1.3 Aim of the research project“A critical analysis of consumer's brand loyalty on sales and profitability of businessenterprise.” A case on ZARA.2.0 Research Objectives and Research Question(s)Research has some objectives which are the framework for conducting research. Theseare the benchmarks which has to be followed. While conducting this research, these aspects hasto be considered. This is relevant for getting authentic outcome as recommendations andconclusions. Research objectives for conducting this research is:Research ObjectivesTo understand the concept of brand loyalty.To analyse the impact of brand loyalty on sales and profitability of ZARA.To determine the factors which has to be considered by managers of ZARA for maintainits brand loyalty.Recommend the ways through which brand loyalty of ZARA can improved.Research questionsDo you understand the concept of brand loyalty?What is the impact of brand loyalty on sales and profitability of ZARA?What are the factors which has to be considered by managers of ZARA for maintain itsbrand loyalty?What are the ways through which brand loyalty of ZARA can improved?3.0 Literature ReviewThe concept of brand loyaltyBrand is the logo, trademark of any organisation which they earn by providing the bestproduct or services to consumers. In order to make good brand image in industry, it is importantto consider demand of consumers. Brand loyalty refers to the consumer's perception regardingavailing services from specific brand. As per Manmohan Joshi consumer behaviour is mainconcept which emphasise on increasing sales when consumers are aware. Brand loyalty is coreasset which these days organisations are using the latest technologies for satisfying consumersand providing them best services. This has direct impact on sales and revenues of ZARA. Inbrand loyalty involvement of consumers is crucial (Bell, Bryman and Harley, 2018).3
According to Jayson DeMers, there are two types of brand loyalty i.e. Brand loyalists andRepeat purchase. Brand loyalists are some consumers who prefers to purchase products onregular basis and loyal towards their brand. They does not get diluted in case other brand isproviding at lower cost. While there are some consumers who purchase same brand but haveoptimal use experience. Under brand loyalty of ZARA, there is impact of personality,relatability, loyalty program, etc. It is important for managers of ZARA to provide complete andrelevant information about product and services. As these days there is much competition inretail fashion store, so it is important to consider changes in demand of consumers. This hasdirect relation The impact of brand loyalty on sales and profitability of ZARAZARA has good brand image because they target high class people. They prefer to servebest quality services. In fashion industry, there are different brands so in order to compete withthem, there is requirement of proper planning. According to Lisa Furgison, brand loyalty candrive sales because consumers who are loyal visit store on frequent basis. As per research, it isclear that out of total sales 20% is because of loyal consumers, but this 20% consumers assist in80% revenues of organisation. Brand loyal consumers have direct impact on sales and profits ofZARA. It is important for managers to keep them satisfied with use of different strategies. Forloyal consumers, there is no requirement of marketing and promotional techniques. Good deals,phenomenal customer experience, shared values, etc. are some positive results which ZARA canachieve by performing business operations in best and relevant manner (Brannen, Piekkari andTietze, 2017).As per Tina Young, there are three steps through which positive impact of brand loyaltycan be achieved. They are discussed as under-Awareness- This is the first step in which awareness about product such as clothes, etc.are created by consumers. This is relevant because this frames base of all activities throughwhich consumers become permanent. It is responsibility of marketing department to conductmarketing activities in interesting manner. Promotional events, advertisements, etc. helps tocreate awareness about product and services.Preference- After awareness among people. They prefer to purchase specific product.This preference will remain same until, ZARA is serving product according to consumer demandand budget. There is difference in dresses as per occasion, geographical background, etc. hence it4
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