Zara's Marketing Strategy Analysis

This assignment delves into the comprehensive marketing strategy employed by Zara, a global leader in the fast-fashion industry. It requires students to analyze the company's marketing mix across seven key dimensions: product, price, promotion, place (distribution), people, process, and physical evidence. By examining these elements, students will gain a deeper understanding of how Zara has achieved its remarkable success in capturing consumer demand and maintaining a competitive edge in the ever-evolving fashion market.

MARKETING ESSENTIALS

INTRODUCTION
Marketing is determined as the crucial tool in this modern business world. In involves
detail understanding of customer's demand, market, marketing strategies, and offering quality
products among consumers. Many organisations have now understood the importance of
customer relationship & are now making efforts to acquire an innovative plan of action towards
marketing strategy. This report is based over a mini case study which describes a business
company named Zara, which is located in Spain and it has around 408 stores in 44 countries. It
deals in both men's & women's clothing as well as kids clothing.
The overall report focuses over the marketing essentials in business. It explains the roles
& responsibilities of marketing with its functions & their interrelation with other functional units
of Zara. Further, it compares different ways of applying marketing mix in the company to attain
goals. Also, this report will produce and evaluate basic marketing plan for the chosen firm.
LO1
a) The key roles and responsibilities of the marketing function.
Marketing refers to a place or area where sellers and buyers meet, where marketers sell
their products or services to customers (Ambat, Cabagnot and Tiong, 2017). According to
Chartered Institute of Marketing; it is the process of management responsible for evaluating,
identifying and satisfying customer's needs. The CIM definition of marketing also states that
why process of marketing is important including its objectives & outcomes. The concept of
marketing determines that it is a philosophy that organisations should examine the necessity &
preferences of their consumers and then only make decision to fulfil them. Further, the nature of
marketing is a human activity under which their needs are satisfied. Its functions refer to the
roles of business entity which allows them to identify successful products for market. Zara also
involves common functions such as; marketing research, development process, strategic
planning, sales, etc. all these are responsible for growth of the company. These marketing
functions have different responsibilities to boost the growth of an organisation (Fill and Turnbull,
2016). Functions key roles & responsibilities are finance, research, communication, distribution,
promotion, selling, etc. Distribution channel: - the role of distribution channel is to understand how company can
distribute their products so that it can be easily available to customers. It basically means

that how Zara will plan to distribute their goods to buyers (Chan, 2018). Whether they
want to sell online, or overseas or on high streets, all these discussions take place under
this channel. Most of its stores are located near high-end retailers that dram high range of
traffic. The organisation with its physical outlets & online existence, enable them to get
reviews from buyers to make changes (Armstrong, Kotler and Brennan, 2015). Financing: - it is an important function of marketing. It consists of two parts in which
financing deals. First is marketing department and second is providing consumers
alternative & easier ways to obtain their products (Yadav, Kumar Dokania and Swaroop
Pathak, 2016). Hence, it means that marketing is going to pay for itself and further helps
company to develop a sense of trust & better business relationships. Selling: - this function of marketing refers to selling finished products in the market. Over
the last few years, use of internet sales has increased, thus, selling has also changed.
Earlier it was used to be a direct interaction between seller and a customer, but nowadays
it can be done almost online. For example, Zara products are supplied based on
customer’s trends (Amos, Coste-Manière and Grasselli, 2017). Market research: - this function is about collecting information regarding company's
target market. Organisation identifies; who all are their customers, what they want to buy,
and so on. Addressing all these questions, requires a market research to observe the latest
trends & knowing its competitors’ products. Therefore, it is a key responsibility for Zara's
marketing department (Babin and Zikmund, 2015).
 Promotional channel: - this function deals with bringing awareness of company's product
to customers by using various promotional tools. Zara gets a lot of attention through
word-of-mouth advertising. Also, it benefits from endorsement from celebrities.
Illustration 1: ZARA Store

Roles & responsibilities of marketing in relation to the wider organisational context.
Zara is fundamentally unique with its advertising strategy. The company consumes about
0.3% of their income on publicity and this is the reason that it does not appear on television or
posters. It rarely advertises any of its stores or have sale promotion, rather it focuses on product,
place & pricing. In contrast to J2 Clothing, a local brand retailer, Zara's sales associates do not
focus on personal selling. It has been determined that its main tool was social media helping it to
improve customer engagement. Distribution strategy: - from designing to distribution and then to sales of its products,
company runs all the business & creates newly designed products available in its stores
within a period of 2 weeks. This strategy allows organisation's distribution department to
distribute products to targeted customers. Most of its stores are located near high-end
retailers that dram high range of traffic. The distribution channel of Zara is determined as
the biggest advantage to this brand because it takes much lesser time to get new designs
in stores (Datta, Ailawadi and Heerde, 2017). Marketing information system: - this role of marketing in context with the organisation is
responsible for product planning, and its execution. It provides useful information &
distributes it in timely manner (Adeoti, Olawale and Abolarinwa, 2017). Gathering
information provides basis for decisions like improvement or development of product,
packaging, distribution, selling and promotion. Brand equity: - it refers to the added value given to products or services. It is determined
that it is necessary for manager to measure and monitor brand equity to manage it well.
Moreover, he must identify whether the marketing programs are having desired effect on
increasing brand value or not (Washburn, Till and Boughton, 2015). Marketing planning: - it is concerned with making plans for production and sales, product
publicity etc. In this area of organisation function, Zara most contrasted with competition.
Its average marketing spend for retail is 3.5% this makes the organisation truly unique.
Marketing planning allows company to create goods or services to fulfil the needs of

buyers in target market. Further, it has been determined that goals of market planning
aligns with wider company's objectives (Wrenn, B. and Mansfield, P.M., 2014).
 Market research: - market research is taken as the major role of marketing. It includes
understanding of the product, price and customers in order to offer the best product &
service of Zara (Fine, 2017). In relation to marketing planning function, marketing
research department assist to find future threats & opportunities to allow managers to
measure those alternatives.
b) Analyse the roles & responsibilities of marketing in the context of marketing environment.
 Political factors :- forces of political environment that impact any business are financial
regulations of a country. These factors may affect Zara's financing function of a business,
further these barriers result in disruption of the market as they affect the economy
(Yudha, Tjahjono and Kolios, 2018). Economic factors :- this include factors such as inflation rates, exchange and interest rates
and this affects the pricing strategy of a company. Zara must take into consideration the
economic growth thoroughly in order to take decisions. For this Zara has a great strategy
to overcome this barrier i.e. affordable pricing (Pratap, 2017).
 Social factors:- these factors can affect market segmentation process, as it includes
factors such as; market trends, cultures, religions, etc. Zara has kept this point in mind
and never enters a new market before doing proper research as society & culture are
important for business (Gummesson, Kuusela and Närvänen, 2014).
 Technological factors :- as technology is modifying globally whether it is in term of
transport, communication or other day to day aspects of business. For promoting its
products in market, Zara can make use of new technologies to make people aware of new
items (Widya Yudha, Tjahjono and Kolios, 2018).
 Environmental :- nowadays consumers prefer products that are ecologically accepted &
belong to organisation. If any company ignores this factor, then it may face problem in
international market. Therefore, the production function of Zara must use environmental
friendly materials.

 Legal :- these factors are considered an integral part of a company. As Zara is an
international brand, then it is necessary for it to follow laws that govern the market to
have brand equity (Zalengera, Blanchard and Gondwe, 2014).
c) Analyse the significance of interrelationships between marketing & other functional units.
The marketing functions are closely linked with other functional units of business
organisations. Assessment of important components of the marketing functions and their relation
with other functional units can be understand with an instance of finance section with
merchandising department. Economic resources are required in marketing for carrying out,
planning, assessment & research of marketing strategies. These function cannot properly work
without with communicating and sorting with financial team in the company. In addition, HR
needs to be aligned with the marketing section to raise sales (Jensen, 2017). Operation management: - it is necessary for marketing section to work closely with
production section to make sure; research & development is designed adequately to meet
present and future needs. It further ensures that goods can be factory-made according to
the quality & design set down by consumer (Hernaus, Bosilj Vuksic and Indihar
Štemberger, 2016). Finance department: - the marketing section need to work with finance section to make
sure that there is an enough budget available to meet the requirements of research,
publicity and distribution (Andersson, Forsgren and Holm, 2015).
 Human resource management: - it is determined that marketing needs to work intimately
with HRM to check that proper staffing & skilled workers are in place. HR management
is responsible for maintaining a balance of its obligations with marketing and those with
other sections. (Hill, 2017).
d) Critically evaluate the key elements of the marketing functions and their relation with other
functional units.
Research is the most important function of marketing and plays a key role. Without a
successful marketing research, business is near to impossible. After the information is gathered
from research, it is further processed identify company's strengths and weaknesses. Then this
processed data allows in making strategies which organisation uses as it provides guidance to
company for competing with strong market. After this successful completion of research &

strategy procedure, next comes planning process (Yadav, Kumar Dokania and Swaroop Pathak,
2016). The organisational planning section uses specific period to prepare the leading strategies
for converting goals into success. For example; if Zara want to meet customer's needs, then it
must do adequate research to identify those needs. Apart from this the marketing department of
Zara will work closely with HRM to ensure skilled workers.
LO2
1) Compare the ways in which different organisations apply the marketing mix to the marketing
planning process.
Marketing mix elements Zara Chanel
Place: it is the very crucial
element of marketing strategy.
This involves distribution
channel & the way marketers
get their products to
customers.
The company retails through
its main website i.e. Zara.com
and it also invests in their
online presence. Its stores are
located in posh areas.
Its products are also available
in various high-end
departmental store that are also
localised in upmarket
worldwide location.
Promotional strategy: in this Zara gets a lot of attention Mixed promotional strategy is
Illustration 2: 7 P's of Marketing Mix
(Source: Marketing Theories, 2018)

new era, advanced
technologies are coming which
allows customers to connect
with new brands (Johnson,
Leenders and McCue, 2017).
through word-of-mouth
advertising. Also, it benefits
from endorsement from
celebrities.
being used by Chanel to
promote its products through
different ways. It runs business
in stores, through online,
billboards, advertising &
public relation.
Price: it is considered to be a
critical element as customers
are more concerned about the
value obtained in an exchange.
The concept of this
organisation is to provide the
latest fashion with affordable
prices in medium quality. It
follows pricing strategy which
is market based, a value which
a customer is willing to pay.
The company does not
concentrate on price rather
compete in a non-price basis. It
focuses on quality of product
by monitoring its features,
luxurious packaging.
Product: it refers to an end
product that marketers are
going to sell. Its main
objective is determined as the
customer satisfaction.
It is one of the leading fashion
brand in the world. Zara offers
products for women, men &
children. The range of product
of company turns over rapidly
(Pratap, 2017).
Chanel creates around 6 to 7
collections every year.
People: refers to the sales
persons, management,
customer service &
organisational culture of a
company.
The company employees best
people for effective working as
they are important because
they deliver the service.
People are key to establish a
target market for Chanel, in
order to understand their
potential customers. They hire
the right staff & provide them
qualify training.
Process: it involves service of
the company, delivery of
products and after sales
services.
After customers receive the
product, store managers
interact with them to get
feedback on what shoppers
like & dislike (Huang and
The company sees process as a
means to achieve outcome and
make use of online marketing
& create short films to increase
their customers interest. It

Sarigöllü, 2014). delivers product with a smile
to make a better buying
experience (Malhotra, 2015).
Physical evidence: refers to
everything that a customer
sees when comes for buying.
Zara store design works very
well. They are built to seem
airy with fantastic lightening.
The company's overall in-store
experience for customers is
unforgettable.
Its physical experience
including packaging,
brochures, staff, etc. attracts
many customers.
2) Evaluate different tactics applied by organisations to demonstrate how business objectives can
be achieved
Tactics are defined as short term plan of actions which are implemented to deliver a long
term strategy. Zara with its different organisational cultures applies tactics to achieve their
objectives. The company spends a large amount of time & resources in planning, designing &
introducing their collections. It uses marketing mix as tactics for the achievements of goals. It
updates it stores with new collection in just two weeks, this leads to shoppers frequent stop at
Zara to check fresh clothing. Its success is based on its ability to quickly adapt to changes. The
organisation uses product to meet consumer's demand; offers affordable price with medium
quality; gets promotion from word-of-mouth and its stores are located in posh areas. Its business
strategy allows the organisation to sell more clothes at full price due to the sense of insufficiency
(Kerzner and Kerzner, 2017).
LO3
1) Produce & evaluate a basic marketing plan.
Zara is considered as the retailing chain, with several stores located worldwide. The
company is known for its marketing strategy which is based more on enlargement rather than
advertising. It starts with a more reasonable price and a limited quantity. It can be seen that there
is long term expansion of company throughout the world, due to growing of fashion industry, by
acquiring its sales target, it will place itself for profit & self-funded growth.

ZARA's Plan is to maintain & improve its position in the market by giving timely
response to the latest trends in customer taste. The company will achieve this by making new
designs that suits its consumers with an affordable price. It's success secret is in its speed as an
organisation creates new designs in just 2 weeks to hit the retail stores. Moreover, it is also
targeting on lifestyle & customer level by changing the clothes in their stores (Bhasin, 2018).
2) Produce a detailed, coherent evidence based marketing plan.
Executive summary
A business is required to provide its customers what they want with the best possible
price, to make their organisation grow (McDonald and Wilson, 2016). Zara's quick response
towards customer's feedback leads them to achieve success in clothing industry. With vertical
segregation, it acquires international strategy for its operations. This benefits the company in cost
aspects but still involves some risks.
Aims: - Zara has an aim to achieve $5 million as online sales. For this, it is focusing more on
customers to reach their satisfaction level. It aims to contribute to the sustainable development of
society (Bhasin, 2018).
Vision & Mission: - ZARA's mission and vision is to satisfy the desires of customer and to offer
them an exclusive choice of fashion. They promise to provide new & the latest designs to their
consumers with quality material that are affordable.
Objectives: - its overall objects are to manufacture high quality clothes at reasonable price &
wants to sell them in stores owned by Zara which are situated at commercialized areas by
offering up to date fashion. Company's key concept is to offer the sales of about 58% men, 22%
women and 20% of children. First of all, company begins with planning for objectives, then
based on this it will assign employees with their responsibilities. Secondly, their performance
will be monitored to see whether they are performing keeping in mind the targets. After that,
they will be motivated to work effectively any efficiently to achieve target (Chan, 2018).
Zara SWOT Analysis
Strengths Weaknesses

 The company's strength is that it creates
its own designs instead of copying from
other retailers (Mishra and Modi,
2016).
 Managers at all stores receives
feedback from customers and then
company follows them to meet their
satisfaction level.
 Designs which are made by Zara are
based on latest fashion & if the product
remains unsold for a month then they
are discontinued from selling.
 It does not focus on advertisement, as a
result of people are unaware of its new
clothes.
 Zara's online strategy is very weak and
web based orders are also not taken.
Opportunities Threats
 If it enhances its web based service,
then it can experience high sales.
 Since, the company is expanding in
America, Asia, and Africa helps in
boosting brand name.
 Zara is facing a lot in international
market due to its competitors Hennes &
Mauritz, and GAP.
 It may also increase its pricing level
because of manufacturing of products
in Spain (Adar, Karatop and Bilgili,
2016).
Strategy: - it is a plan which company follows to outline all medium and long term steps in order
to achieve target. Its main strategies are:
 Market penetration: - Zara is involved in the production at Galicia, Spain. It is selling its
manufacturing products about 50% in Spain, 20% in the countries of Africa and Asia, and
about 26% in Europe.
 Market development: - as per its current marketing position in 71 countries, with a
network of 1,475 stores, company concentrates on the development by reducing barriers

occurred in market, focusing on demand of consumers and by having the strength to
accept challenges (Pavlou and Stewart, 2015). Diversification strategy: - company's diversification strategy is based on increase in the
product line and then gradually move towards the places where it can establish its market.
It plans to add cosmetics along with home products to beat its competitors.
Segmentation, Targeting and Positioning
Segmentation: - Zara uses mix of geographic, demographic and psycho-graphic division in order
to satisfy the increasing needs. It launches new trends every two weeks and enter the market with
fast fashion brands reflecting taste of its customers (Alberts, Charpiat and Menze, 2015).
Targeting: - it is made up to women 58% clothing, 22% of men's and children 20% and targets a
wide age range from 18 to 45 years old with a mid-age income.
Positioning: - it provides high quality styling products which reflects the latest trends at
affordable price. Zara among other has 3000 stores worldwide and spends 3 to 4 weeks on the
process of designing a new product which is more than competitor’s (Bhasin, 2018).
Tactics
The next step in planning is to form certain tactics in order to achieve goals. Zara can
attain this by following a good plan of action to target its customers by promoting its new trends
through advertisements to increase sales. Another way a company can use to start taking orders
online and improve its web based strategy (Schultz, 2018).
Control
It has been determined that the firm controls & supervise its brand by holding all
objectives & goals. By using effective communication skills proper work is done by management
that has contributed new business models in the company (Rapp, Bachrach and Voorhees, 2017).
3) Design a strategic marketing plan that tactically applies the use of 7 P's.
Product: - Zara has attained a lot of expansion & reputation in a short period due to its
clothing trends. But often it has few problems to solve like lack of seasonal variations in their
range. Further, it also needs to cope up with the cultural needs of local people.

Price: - the concept of Zara as discussed earlier, is to offer goods at reasonable price with
medium quality products. This has helped to meet the needs of wide range of customer segment.
Company can raise its pricing strategy by improving quality of clothes (Mohammad, 2015).
Promotion: - As discussed, the company does not concentrate much on advertisements
rather gets a lot of attention through word-of-mouth. It must start promoting its new designs
through television to spread awareness.
Place: - company has several stores, apart from which it sells online. However, they are
unable to expand it. Hence, they should start focusing on online sales in order to increase
customers.
People: - Zara can hire more skilled people as employees as they are very crucial factor
of 7 P's. The behaviour of staff members is very important in measuring customer experience.
Process: - production, distribution and selling of products, all of these process should be
controlled tightly by the company to ensure consistent consumer experience (Wolfe, Silmon and
Miller, 2014).
Physical evidence: - they can improve their store’s appearance by adding brand name
pictures, past customer reviews and stores locality to the centre of town.
CONCLUSION
The report concluded that, marketing is determined as detail understanding of customer's
demand, market, marketing strategies, and offering quality products among consumers. The
company named Zara company spends about 0.3% of their revenue on promotion and this is the
reason that it does not appear on television Organisation with its different organisational culture
apply tactics to achieve their objectives. Further it concluded that, company spends a large
amount of time & resources in planning, designing & introducing their collection. ZARA's Plan
is to hold & improve its position in the market by giving quick response to the latest trends in
customer taste. It will achieve this by making new designs that suits its consumers with an
affordable price.

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