Marketing Management: Zara's Market Positioning and Potential for Growth

This report provides an analysis of marketing management in the context of Zara, a multinational fashion company. It covers market positioning, unique selling methods, internal and external marketing audits, competitive analysis, and the role of marketing mix in promoting Zara's products.

MARKETING
MANAGEMENT

Table of Contents
EXCECUTIVE SUMMARY...........................................................................................................1
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
OUTLINE OF INDUSTRY, MARKET POSITIONING WITH THEIR UNIQUE SELLING
METHOD...............................................................................................................................1
MARKETING AUDIT (INTERNAL AND EXTERNAL) AND POTENTIAL FOR
MARKET GROWTH.............................................................................................................4
COMPETITIVE ANALYSIS.................................................................................................6
SWOT ANALYSIS OF ZARA..............................................................................................7
MARKETING MIX ( 4P'S)...................................................................................................9
CONCLUSION..............................................................................................................................12
REFERENCES..............................................................................................................................13

EXCECUTIVE SUMMARY
Marketing management refers to managing of marketing essentials which is drive in such
a way which help to gather more market in terms of product which enhances the profitability and
productivity of organisation. As per this report is showing brief analysis of marketing
management which is relevant to the selected business firm. This report includes market
positioning as well as present unique selling proposition of the selected firm. It outlines
marketing audits such as internal and external, also tells about it's potentials for growth of the
company. This document covers competitive analysis for both company as well as it's newly
introduced product and defines role of marketing mix in promotion of it's product.
INTRODUCTION
Marketing management is defined as the various function which is drive within an
organisation to take the overall analysis and manager the market process and running operation.
This help organisation to run their operation smoothly. This is create in such a way to develop
good relationship between customer and market. Marketing management is used by organisation
in very effective way to regulate the function properly and achieve the objective of firm. This
marketing management help number of people to select the effective market and gain maximum
profit from new marketplace. This help organisation to take advantage and fulfil the aim of
organisation (Bankvall and et. al., 2017). As per this the chosen organisation is Zara. Zara is an
multinational company which is dealing with various number of product of sales and fashion,
they have huge range of clothing for kids, men and women. Now they are ready to deal with
women jacket with huge product range in market. So as per this there are number of analysis
which is drive for Zara to improve their market strategies and rivalry. In this report the history of
Zara and total approach of STP will be discussed with internal and external audit. Observation of
organisation by various model is taken and marketing mix is analysed.
MAIN BODY
OUTLINE OF INDUSTRY, MARKET POSITIONING WITH THEIR UNIQUE SELLING
METHOD
Zara is a multinational company which is dealing with fashion industry, they have wide
range of product. The product are being relatable with every age group of people. It may include
wearing range for kids, men and women. As per this the selected firm going to launch jacket for
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women, they came in market with popular and new trend of jacket. Which is only for women
otherwise they launch and their development team always introducing various product which is
based on fashion and new trend of market to attract customer (Ing and et. al., 2020). Moreover,
Zara is operating their process with fixed amount of stores where firm can also grow at global
level. As with the present report there is brief discipline of selling of product with quality and
pricing. The consumer are well satisfied with their product. Organisation follow unique selling
method in market to gain attention from customer in term of their fashion store and they create
trend in social media about their product and create hashtag motto in social media as tool of
promotion. Their STP approach are discussed below:
STP approach
it is well defined as systematic communication which is used to followed by number of
organisation in order to gain profit in market with their new strategies within relation to
marketing. As per Zara there are three step of strategies which is followed to take lead in market
in their fashion industry. These include segmentation, targeting and positioning which is based
on Zara with their product and services. In this context the selected firm also used STP approach
to achieve its marketing aim and goals which help firm to fulfil the need and want of consumer.
In present business environment, Zara is providing various enormous techniques and tool to
employee by which they gain the objective of firm in fashion industry (Luu and et. al., 2018).
Under this, the selected firm is regulating various function which is elaborated below:
Segmentation: This approach is termed as the function of an organisation to meet the
objective and achieve the target in proper manner. Whereas, it is defined as activity within an
organisation which is related to make several group of market according to the overall analysis
of customer need and want and this segmentation is based on small and valuable group.
Moreover this segmentation help organisation to gain effective commercialisation and proper
interaction with audience in order to product and service which bis offered by firm to an
customer. This segmentation also help business to develop marketing mix and position of its
product in a segment market. In context with Zara. This operation of business is going in UK and
all over the world where the organisation used proper marketing strategies in order to gain profit
from market. Their are various approached of segmentation which is discussed below:
Demographic- demographic segmentation is defined as the taking an target which is
based of group. As per the context with Zara this segmentation is under gender, age, income,
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education and various section of region to target and segment the consumer in such a way. Zara
use this as a target for those whose age group fall from 10 to 50 years. In this firm play a role to
divide this accordingly to appropriate manner.
Psycho-graphic: The psycho-graphic segmentation defined as the type of segment which
is related to perform various function in an organisation which include the operation is proper
manner (Mahlamäki and et. al., 2019). In context with Zara, organisation used to divide and
segment the market on personality and collect the data organisation use various surveys and
customer data. All these are vary useful approach in context with selected enterprise to gain and
improve various function of organisation and achieve the target goals and objective according to
wants and need of customer.
In which organisation uses both the segmentation in order to gain market according to
need and wants as well as performing this in appropriate way. This remarks as helpful behaviour
of Zara to accomplish the objective of organisation.
Targeting: it is defined as the evaluation techniques in which it is help to determines the
potential market which refer to potential customer. At this the evaluation is based on need and
want of customer with their expectation. In context with selected firm, organisation using this in
proper manner which help to manage the target customer as well as achieving objective by
targeting those who have potential and organisation prepare product for them. Their are various
factor which is used in targeting while target a group or people, some of mentioned below:
Criteria size: The market must be huge enough to manage the target customer so
segmentation play vital role in targeting the customer (Marcinkowska and Barałkiewicz 2016).
The organisation use proper method to execute the plan and implement in marketplace to achieve
the objective. As per the Zara, they have their short term market target and long term market
target which is based on target group. So Zara manage their implementation in such a way to
control the flow of production and product availability in market.
Difference: it is also defined as the factor which considered by organisation by using the
tool of target function. It provide information to measure the difference which must exist
between two segment. This help organisation to determine the various function and strategies
which is being implemented for product according to difference in various segment.
Positioning: Positioning is defined as the process which include the position of product
in market. This all events are depend on customer interest, if customer purchase product from
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same organisation and they became loyal for that automatically this create an position for them.
This image in customer mind help organisation to grow rapidly. In context with Zara, the
organisation is used functional positioning system where it has identify and determines that
feature and set of activities which going according to the customer experiences. Moreover,
organisation focused on the value of proposition that used to recognise by meeting and fulfilling
the customer expectation and needs.
From the above discussion. It can be evaluated using proper system to determine present
resources and implemented its function. Which is based on need and expectation of customer.
This is helpful for organisation to complete its objective while per' the function which is based
on organisation structure and framework.
MARKETING AUDIT (INTERNAL AND EXTERNAL) AND POTENTIAL FOR MARKET
GROWTH
Marketing audit is defined as the system of comprehensive, systematic, analysis and
based of evaluation (Maria, 2016). The interpretation of business marketing environment which
is both internal and external, its objective and new strategies with their principle to ascertain
areas of problem and various opportunities and to recommend a action plan which increase Zara
sales and market performance. There are various component which is represent the marketing
audit like macro environment audit, task environment audit, marketing strategies audit,
marketing organisation audit, marketing system audit, marketing productivity audit and market
function audit. Thus, it help to determine how a organisation marketing department is carrying
out the marketing activities and adding up the overall performance of organisation.
Internal audit
It is defined as the department of an organisation of people within firm that provide
unbiased, independent reviews of system, business organisation and processes. In which they
play internal audit to provide senior leader and other organisation objective which is about risk,
control and operational effectiveness which is applied through laws and regulation. This will be
understand by applying model which called as VRIO model to analyse the internal audit of Zara.
VRIO analysis of Zara- VRIO analysis is defined as the analytical tool which is applied
in organisation to know to evaluate firm resources and this help to gain in competitive advantage.
VRIO is stand for value, Rareness, Imitability and Organisation.
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Value: Zara do not include ant third party to produce product and service or to designs
anything. The organisation manages all designs, warehousing, distribution and logistics function
itself. In which they are more flexible and faster than opponents and overall it help to decrease
the operational cost which has excellent organisational structure and value that all employee
must respect to organisation and their decision (Ouwenga and et. al., 2017). As per this Zara
follow changes in consumer taste and as adopted flexibility, they adopted speed as well.
Rareness: Zara is produce new items and deliver them and deliver them in stores in less
then three week rather than the average six month which is needed for higher brands and in term
of production in a typical season it produces about various item which is up to 11000 thousand
while competitors would produce typically 2000 and 4000 as per this the resources are rare.
Imitability: As per the present time everything is imitable. In case of Zara, everyone copy
their business model with low quality of fabric which end the imitable condition or Zara.
Organisation: In the context with Zara, the annual reports state that they are enhance
their sale and profit constantly. This is by top management, but also to every individual who is
engaged in every process of this. Their are possibilities of coordinating all those where there is
same kind of decision making process.
External audit
An external audit which is based on marketing show the external components that shape
the marketing and product development strategies (Zhang and Wang 2019). Usually the external
environment in this promotional world is split into two segment like micro and macro. This is
analyse by PESTLE analysis.
Political factor: Usually Zara is a Spanish brand which is now globally active. In the
context with political factor. This is one of the biggest running company in European union
which has extensive trade agreements.
Economic factor: As per this Zara used low cost labour and also on of the highest
employment rates within Europe which is create by Zara. This low cost labour provide him
positive aspect which improve.
Sociocultural: In this context, Zara deliver best quality of product to their customer. They
taking care of their worker. Overall this strong positive brand appearance allow Zara to collect
healthy profit margins for its shareholder.
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Technological factor: Zara have hug base of customer so the firm need high technology
to expand their reach. As per this the technological are used in such a way where number of
people get access on website at same time.
Legal factor: In the context with fashion brand, copyright is taken out in such a way
which create the legal breaches. There are various brand which claim copyright issue on Zara for
their design and it will be penalise for this issue.
Environmental factor: Fashion world is full of wastefulness. So, this waste is recycle in
such a way to improve and create new session of cloth for those who have their needs.
COMPETITIVE ANALYSIS
It refers to the process of identifying key strengths and weaknesses of companies
competitors and helps a business firm to evaluate it's respective plans and policies with a motive
to boost of companies sales (Bell and Rochford, 2016). The objective of this analysis is help
management of a business firm to make policies with respect to it's existing competition. It
extracts needful information which helps management to capture market full of demanding
customers and also helps in removing threat of substitution of companies products or services
enabling company to grab future opportunities towards overall growth of an organisation. With
contrast to Zara as it is focusing on promoting it's newly launched women jackets. The jackets
are made attractive keeping in mind current trend in market and are easy to wash with free hands.
However it does not supports bleaching. The jackets are made available in market using
innovative promotional approaches and are available in lower to luxury price range. The
company has played a master stroke in deciding this time for opting for boosting this product
sales as current winter season is perfect time for it's promotion. The jacket comes with round
neck cap attached with it, and is designed using health care techniques to deal with current
pandemic that is COVID-19 that adds up to it's uniqueness of the product. The company uses
two main tools for determining it's competitive analysis which are as follows:
PORTER'S FIVE FORCES MODEL
External environment of a firm plays an important part in formulation of it's respective
plans and policies. Various companies irrespective of it's size of operational activities have to
follow a bear consequences of business cycle. Every company have to adopt as per existing
external environment of a business firm for that various policies formed in a firm should be made
flexible enough to welcome needful changes (Burns and Dewhurst eds., 2016). It comprises of
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social, technological, cultural, political and environmental factors. This model includes five
forces given by Michael Porter these are as follows with context to Zara:
Competitive Rivalry: It helps in analysing at number and strengths of respective
companies competitors. With context to chosen company, it have planned it's respective policies
in order to promote it's product i.e. jackets for women. The management of company have
decided to use innovative techniques in order to display their unique product to their various
customers across the world.
Supplier Power: It refers to power of companies raw material suppliers to make changes
in prices of products. With relation to chosen organisation, power of their suppliers are strong as
because of companies policies being stuck to one supplier and establishing good relations with
them.
Buyer Power: It refers to the power of respective buyers of an organisation to make
changes in prices of companies products. When related to Zara, it can be said that buyer power
here is moderate as company deals in fashion products and due to limited stock as compared with
number of customers, sometimes company is unable to feed well to it's customers.
Threat of Substitution: It refers to likely activity of substituting companies product with
any other product that offer almost same quality and is available at lower prices. In relation to
chosen company, it faces high threat of substitution as it deals in fashionable product line. It's
management have to keep in mind this threat while introducing it's new product.
Threat of New Entry: It refers to entrance of any new company with it's new product in
an existing marketplace. With regards to Zara, as the workforce is a well established business
firm, threat of new entry will defiantly affect it's sales but for short period of time. However, the
company will stay with it's brand image in long time period.
SWOT ANALYSIS OF ZARA
It refers to the complete analysis of a company's strengths, weaknesses and upcoming
opportunities and threats to an organisation. For an organisation to operate it's business
operations effectively and to be favourite brand to their customers for a long period of time
(Huber, Bugmann and Lafond, 2018). It helps the company to complete it's objectives of
optimum utilisation of resources as key polices and plans of an organisation are been made
considering respective competitors of workforce and aim is to conquer market demands by
maintaining companies customers loyalty. Swot Analysis is an important analysis used by the
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management of an organisation which also helps in it's decision makings. Swot Analysis of Zara
aiming to launch it's new product i.e. women jacket are as follows:
Strength Weaknesses
 Zara offers unique designs of product
to it's respective customers and is one
of the strongest strength for an
organisation. It attracts various
customers as it offers various range of
product flowing to low to luxury and
deals in party wear, office wears, for
kids as well as for men-women.
 The company has it's strong presence
throughout international marketplace.
It has it's established brand name in
domestic and throughout international
markets. It will help the workforce to
promote it's newly launched jackets
for women as old and strong trust is
already built towards company brand.
Zara lacks advertisement activities for it's
various products along with services. It is
true that advertisement adds up to cost of
production but it's advantage can't be
ignored. Advertisement has potential to
double sales and turnover of companies
product. However, the management has
decided to cover this weaknesses for
introducing it respective product without
extra increment in it's product prices.
Due to existence of internal disputes
organisation is unable to establish proper
coordination between various activities in
department.
Opportunities Threat
 Zara is an emerging brand in E-
commerce sites. By comparing current
pandemic situation it can be said that
the firm will be able to grab online
market platforms by taking proper
guidance from professional decision
making.
 With the new introduction of it's
product i.e. jackets for women.
 Zara has a huge captured marketplace.
Supplying respective finished goods to
their retail outlets and activities involve
in production and supply departments
may sometimes act as a threat for the
company. As it is not easy for the firm
to take care of such a huge market
customers.
 Competition for any business firm acts
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Growing demands of respective
product consumers can be managed
well and is best opportunity for a firm
to increase it's market presence.
like a huge threat to an organisation. It
will make difficult for it's marketing
department to promote it's newly
launched product. Some of it's top
competitors are Chanel, Christian Dior,
Burberry, Gucci and Prada. However
company will take needful actions for
tackling it's competitor strategies and
will ensure boosted sale for the
organisation.
MARKETING MIX ( 4P'S)
It refers to various tactics followed up by the management of a company with a view
point to boost up it's sales of products or services. It helps an organisation to maintain it's good
brand image in marketplace and by providing them quality services marketers are able to seek
loyalty of customers towards companies brands. Marketing mix can be defined as tool of
marketing that helps respective marketers of an organisation to promote it's products or services
in a given marketplace in efficient manner (Karpenko and Filyppova, 2016). As decided by
management of Zara to promote newly introduced product i.e. women jackets, as per analysis of
current marketing trends. Marketing mix includes 4P's, product, pricing, place and promotion
respectively. With context to chosen organisation these are as follows:
Zara product strategy: It refers to a tangible item which is actually been sold by the
company and their customers are paying for it. Product strategy with marketing mix together can
be referred to as promoting various products displayed by the company for satisfying needs and
wants of their valuable customers. As resources are limited in nature it should be used in an
efficient way, this tool helps the marker of firm to carry it's operational activities included in
promotion of companies brand effectively. The chosen organisation is a leading fashion brand
which works across 147 countries in the world (Zhang and Yang, 2017). The company deals in
wide range of luxury products such as jeans, trousers, tops, skirts and many more. As per decided
by higher authorities of business firm to promote it's product which is women jackets by
analysing the current season demand for the product. The marketing department of workforce
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will be using innovative techniques in promoting it's decided product and will ensure that current
resources of the business firm is been used in effective way.
Zara pricing strategy: It refers to a value that is marked on various products displayed
by the company. It is influenced by various factors such as production activities, sales activities,
market demand, promotional activities, government policies and many more. Pricing strategy
with marketing mix together can be referee to as that part of management which helps in taking
various decisions by management of a company in deciding it's prices of respective products and
services. It is important for a business firm to determine right prices for it's respective products to
be sold in marketplace as slight high prices may lead to shift in demands of companies
customers. The management of respective company have adopted various methods for
determining it's external business environment and kept a price range from lower to luxury to
capture almost entire demand in marketplace (Trinh and Nguyen, 2019). It will be the right time
for the firm to promote it's product i.e. women jacket because of favourable season for it.
Marketing mix tool will help the workforce to grab this opportunities effectively and will ensure
better working with growth of the company. Taking advantage of this opportunity organisation
can also increase it's market presence in international markets and achieve it's goals and
objectives by boosting up their sales.
Zara place and distribution strategy: It refers to point at where the companies products
will be offered for sale to it's customers. It becomes important for a business firm to decide right
place for distributing it's product by doing proper research and development of the market
environment. Place strategy with marketing mix refers to the part that helps the management of a
business firm to decide as well as plan place and distribution activities related to it's products.
With context to chosen organisation that have decided for selling women jackets, the company
will be displaying it's product in various retails stores by doing sufficient promotion and will also
aim to capture online market by adopting techniques of digital marketing to enable business firm
to capture huge market customers. So far company is been operating in 147 countries consisting
of 6500 outlets across the global. For handling this large number of outlets around the world with
million of customer, the management of company has adopted effective promotional techniques
with proper distribution systems for motive of profit maximization of the firm.
Zara promotional mix: It refers to all activities undertaken in order to promote it's
offered products and services to their customer. Promotional mix is an important part of
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marketing principles which helps management of a business firm to formulate it's plans
effectively. In regards to chosen organisation, marketing department is taking care of all the tools
of promotional mix that helps in better spread of availability of companies products to their
consumers. It helps the company in achieving it's desired sale target and ultimately contributes to
boosting up of sales of an organisation. The marketing department of the chosen firm has
adopted various innovative techniques in order to promote it's newly launched product i.e.
women jackets in marketplace. It is been analysed by smart brains of an organisation that it will
be correct and the most appropriate time to boost up this product range. All promotional
activities are been directed to promote this product investing good amount of financial resources
in it's promotional activities.
The above mentioned marketing mix tools helped management of Zara to boost up it's
sales of newly launched product i.e. women jackets. This tool proved to be useful for the
workforce to accomplish it's desired goals in an effective manner. It helped it's management in
deciding right price for product that supports companies tag line which says about quality lasts
forever in minds of people but price is forgotten (Salem, 2019). It helped the workforce in
maintaining it good brand image amongst it's respective customers from world wide and
enhanced living standard of their potential product consumers. This tools helps the company to
cover the gap between it's external environment and respective policies been formed in an
organisation.
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CONCLUSION
From the above report it can be said that there are various factors that influences growth
of a business organisation. It tells about various marketing mix tools that helps company to
convey it's business activities efficiently. This report also highlights role of competition in
deciding various policies of chosen company and also conducted various analysis in order to
analyse external environment of the business firm.
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