Marketing Essentials: A Comprehensive Report on Zara's Strategies

This report provides a detailed analysis of Zara's marketing strategies, exploring various aspects of marketing essentials. The introduction offers a brief overview of Zara's global presence and rapid growth in the fashion industry. Task 1 delves into the core functions of marketing, including information management, distribution, product management, pricing, promotion, selling, financing, market research, and supply chain management, providing specific examples of how Zara implements these functions. The report then examines different organizational functional areas, such as sales, purchase, manufacturing, and marketing, highlighting their roles and contributions to Zara's overall success. The report emphasizes the importance of information management in understanding customer preferences and market trends. It also discusses the application of the marketing mix within the context of Zara's operations, offering insights into its strategies for achieving profitability and meeting its objectives. Finally, the report concludes with a summary of findings and recommendations.

MARKETING ESSENTIALS

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1 Management of information..................................................................................................1
P2 Different Organisational functional areas..............................................................................4
P3 How marketing mix are applied on different organisation as compared to ZARA...............9
P4 Marketing Plan for Zara:- ...................................................................................................11
CONCLUSION AND RECOMMENDATION:-..........................................................................12
REFERENCES..............................................................................................................................14

INTRODUCTION
In this competitive world, marketing is the thing which is a back bone of any firm.
Marketing help company to sell their product and service to large market and information about
goods and services are provided to million of people through marketing and although it is a
complex and contradict process as well. The first Zara store was opened in 1975 by Amancio
Ortega at downtown A Coruna, Galica, Spain (Babin and Zikmund, 2015). Firstly, Ortega
opened the store naming 'Zorba' inspiring by the classic film ''Zorba the Greek'', but later he
come to know about the bar which was two blocks away having the same name, they rearranged
the characters as ''ZARA''. Within very short span of time this small store has developed itself
into a large firm. The company started its international expansion in 1988 with the help of Porto,
Portugal. Later in 1989 and 1990 they entered United states and France respectively. Later in
September 2010, Online boutique was launched by ZARA. In 2015, in the list of the best global
brands ZARA was ranked 30 among the best leading brands all over the world(Baker and Saren,
2016).
Zara is having more than 2100 stores world-wide and fifty-third position at worlds most
valuable brands. The organisation is having 152,854 numbers of employees in 2015 and very
rapidly growing in clothing and fashion industry. The report will discuss about various function
of marketing and in different context as well. Apart from this it will also discuss about marketing
mix and its plan which will help in making higher profit and attainment of goal and objective in
effective way.
TASK 1
P1 Marketing function
Information management is the providing of relevant information to decision makers of
the organisation or to others. The information includes both physical and electronic informations.
Management of information Support these guiding principles which includes-Every possible
information should must be shared which helps in exploitation of corporate knowledge. The
keeping and deposit of information is very crucial (Brady, 2014). The management of
information is done with the help of many systems which is generally a software designed for to
assist manage information. Marketing basically works on its seven functions and all these
function information is managed by an organisation which help them to run company
accordingly.
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 Marketing information management (MIS):- This is the management of the processes
and methods which are used to collect or gather information about the organisation and
then analysing it according to the companies needs. The finding of reports which is
relating to ZARA marketing products and the services provided by them toward their
customers(Campbell and Martin, 2015). The management of information helps ZARA to
determine their customers demand and attitude toward the company, preference of
products they are willing to be provided by the firm. MIM is very useful to test products
features, determination of growth potential and size of market. This information helps the
organisation to its sale and profit.
 Distribution (Channel Management):-It is set combined group of activities and business
to business firm operations to introduce their product to market with the help of channel
partners as much efficiently and effectively they can(Forshier, 2012). ZARA is
promoting their products through both offline and online channels. The distribution
includes:-
 Sale forecasting:- It is estimation of the future sale which is company going to make,
and provides insight to the company for its cash flow, resources and workforce
management.
 Channel marketing management:- These are the techniques used by the organisation
to promote its products to wider range of customer base. Using these channels ZARA
can promote its clothing and other products, marketing channels are those which are
necessary for the transformation of ownership of goods to the point of consumption
from the point of production(Griffin and Ebert, 2010).
 The management of the Inventory is the oversight of stock items.
 Incentive program management are partially used for the motivation of employees
and in the sale to attract the customers.
 These also help the organisation for its Financial and risk management, to manage
data integrity and recognition of revenues. Product or service management:- Product management is the techniques which help the
organisation to check and involves function such as obtaining raw materials, developing
them and then maintenance or improvement of those products and services. It is the
process of changing and creating new information about offering company's catalogue
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Zara is having special quality check team which ensure that every Zara product is
maintaining the name of the brand and providing customer satisfaction(Hair, 2015). Zara
products and service management team maintains their online catalogue as according to
trending lists. Pricing:-Pricing is assignment of the value customers see in the product and the value
customers are willing to pay for that product. The Brand price and the rate of products
offering by Zara is much higher than other local brands because of their product quality
and specific fashion catalogue which encourage their customers to pay the offered rates
by the company. The wrong pricing of the products can also negatively influence the sale
and cash flow of the company(Jackson, 2011). Later the company manages its
efficiencies and make changes accordingly in its pricing. Zara had reduced its cost for
manufacturing which helps the organisation to reduce the prices of its products, offering
of such low price for very good quality of product Zara has become the first choice of
many of the customers and help the organisation to make such a good profit. Promotion:-Promotion is the publicity of the products and brands offering by the
company, with the help of advertisement and other promotional activities. The promotion
are done by using Catchy Tag-lines which are attractive and draining the focus of
customers towards that products. Zara is also promoting their products using social
media, use of social media for the promotion is very effective these days from there
companies can directly attract customers to their catalogue and increases their sale.
Finding of promotional partner and promoting through them could be very helpful for
Zara. By appointing Brand Ambassador, selecting those who are trending and most
loving by the people for the promotion of products will definitely result in profit to Zara.
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 Selling:- Selling is the term of marketing products between the seller and buyer where
money is exchanged for that products(Kongstvedt, 2012). Zara is mainly selling products
such he clothes, shoes and other fashion accessories for women, men and kids as well.
Mainly the products of Zara are selling on their thousands of stores in over more than 15
countries. The organisation is also selling their products online different online stores and
on social media. The selling of products by its manufactures or by the retailer to the
customers is selling which includes exchange of money for that particular product as
according to its value in the market.
 Financing:- For business activities, the act of funds providing is Financing. It provides
companies to purchase products from the market which are out of their present reach for
their business. It helps in making profit rate higher even if currently company is not able
to make such profit. Basically there are two types of financing:- Debt and Equity, which
is in debt the amount is paid back to the financier with some extra amount as an interest.
Whereas, in Equity the amount is given to the company on behalf of ownership to the
stakeholders(Jones and Rowley, 2011). Zara is also using Equity type of financing and
had sold its shares at very good rate which is making very good profit to their stockholder
as well as their company too.
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Illustration 1: Marketing and selling
(Source:- Marketing v/s Selling, 2017)

Market research:
This is one of the major function which is related with the collecting various information related
to the product and services. There are different data related to competitors, market trends,
customer changing needs etc. must be required to perform in the future. Zara one of the leading
company in the fashionable clothing needs such information in order to attain competitive
position in the market.
Supply chain: This is another significant function which related with the acquisition of goods
and services from suppliers, start production and delivering to the end customer. Zara having
more than 2100 stores across the world and need timely delivery of goods at the right time. The
cited firm having an integrated supply chain system and it helps to update their stock level and
provide competitive edge in the market.
Marketing planning: Each and every company is having its own objectives which can be
related with the short term or long term. For instance, Zara current market share is approx. 5
percent now company wants to increase their markets share by 8 percent in the next 4 years. For
such objectives they required to design an effective marketing plan and meet their set target in a
given period of time.
P2 Different Organisational functional areas.
Every organisation is built up different groups of function, which together coordinates
with each other and works and provides support for the welfare of the organisation. Functional
department support specific purpose for the achievement of objective with in organisation. The
information need are the group or an individual who desires to obtain information for the
satisfaction of needs (Lipsman and et.al., 2012). There are some most common function areas of
an organisation which are discussed below:-
 Sales:- This is the terms which is used for, the dealing with customers and generating of
order through them. That is sales are type of promotion which is done to force of
encourage customers to buy the product selling by the company. These techniques are
generally used to generate sale which varies within an organisation, but some of the most
common are Internet by the use of this technique Zara would be able to promote its
products to more customers, By the use of telephones, selling of products promoting with
the use of telephone is very common in this Sales agents can tell their customers every
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possible single details about the products and their services, By the door to door sale of
their products or by direct sales through representatives in the market (Lovelock, 2011).
 Purchase:- For the management of purchase every department has appointed their
purchasing department. The work of this department in an organisation is to manage
products selling and production rate at most preferable ratio which can make the highest
profit to the company. This department monitors the rate or amount of stock required for
buying and selling accordingly. The purchasing department also manages and responsible
for to buy consumable products which help to run an organisation. Zara is a global
fashion icon, to run such big organisation the company has to appoint different managing
teams with different budgets to work properly.
 Manufacturing:- In an organisation there is department which manufactures products as
according to need and rate of selling of those products. The work of this department is to
convert the raw material into productive good which can help the organisation to make
profit. The manufacturing department of Zara is having very high automated distribution
centres which are known as Cubes. This cube is around 5 million square ft. which is
contains 11 underground and over factories spreading in within over 16 km of area. Zara
is a company which changes its clothing designs around every two weeks on an average,
continuously manufacturing new product's designs as compared to other competitors who
changes their products design around after every 2-3 weeks. Zara is very much distinct
about their quality and uniqueness which is the main key behind the success of the
company (Malhotra, 2015).
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 Marketing:- The marketing department promotes and advertise the products of the
company. It may be merged with sale function and helps in getting good profit by the
increase in sale to the company. Zara is a retail industry, rather than advertising or any
other traditional method of promotion Zara is focusing on Expansion. The main
marketing objectives of Zara are to increase in customer equity, providing increaseed
purchase frequency among the customers having '' Plus size'', by continuous growth by
extending fashion brand of Zara, the most focus marketing plan is to increase the
awareness about their brand and providing favourable attitude towards their customers.
 Finance:- Within every organisation or department the main function of finance
department is to ensure the financial stability in an organisation and steady flow of cash
which is very important to maintain to support day to day transitions (Marshall and
Johnston, 2011). Zara finance management team works very efficiently and providing
proper budgets to save extra expanses on manufacturing and other possible works. The
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Illustration 2: Zara Distribution Cube Structure
(Source:- Zara clothing company supply chain, 2016)

finance department basically deals with the management of Bookkeeping and payables,
monitoring financial reporting and controls, Take care about and do function to manage
taxes and controls, in the analysis of strategic and financial planning, it also manages the
Treasury and working capital, provides capital budgeting, Take care and manages
different risks and works for the development of different corporates and their strategies.
 Human resource:- Human resources broadly provides support to the employees working
in an organisation. Their primary function is to take care about the working of an
organisation in positive and productive direction ensuring the welfare of every single
employee relating to organisation. The work of human resource management team is
giving advice and guidance to employees about their work, and motivates them to work
according to take company in positive direction. Which increases the productivity and
profit rate of an organisation maintaining the work-environment. Human resource
management team at Zara is maintaining the proper structure to organise running of the
company (Papasolomou and Melanthiou, 2012). By perusing proper training activities at
Zara to their employees about their works and roles towards the organisation. At Zara
policy of compensation are very useful which encourages existing workforce to works in
a company and attracts more qualified employees for to work in Zara.
 Administration:- The administration department deals with the paper works which is
important to run an organisation or a business. The administration department coordinates
with finance department to manage financial information about the company. This
department also coordinates with sales and purchasing department to maintaining the
relation with suppliers and the customers. Overall, administration department works to
coordinate with human resource, accounting, billing, finance, health and safety and all the
other department in an organisation and takes decision. It works in this form such as
Firstly planning then organizing of the process after that staffing which contains filling of
jobs position in company with right person and at right time, it involves determining and
screening of people, After staffing the directing comes which contains directing of people
and loading them to achieve set goals by the organisation, followed by Controlling which
evaluates all the areas and potential from the organisation plans, it includes management
of information and establishment of corrective actions and then at last the work of
administration is budgeting.
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P3 How marketing mix are applied on different organisation as compared to ZARA
Marketing mix is a set of techniques or actions which refers to the set of action used by
the company for the promotion of its production or the brand itself in the market. Marketing mix
generally works on 4Ps which makes typically mix of the marketing, These 4Ps are Price,
Product, Promotion, and Place. Nowadays with the increase in marketing techniques three more
Ps are added in the criteria of marketing mix which are Packaging, Positioning and People or
politics (Shaw, 2016). Marketing is the mixed element in the different quantities of an
organisation which finally delivers to one basic formulation which help the organisation to work
according to that and make profits.
The 4ps of marketing mix according to their foundation of ideas:-
 Product:- Products are the materiel or items which are produced to satisfy the customer
need or to fulfil the demand of certain group. Products can be real or other intangible
thing, Company or marketers must continuously expand their products mix by updating
according to trends and modifying the depth of the products list.
While, developing products company should keep in mind about the need of client, that is what
type of products and services they want from the company and the use of that products for the
customers (Shukla, 2015).
Asos is one the leading online fashion brands and selling their products world-wide. The
products selling by Asos is mainly for Adults and not having variety for kids and others the
quality and rate of Asos is also not good as Zara is offering to their customers.
Whereas, Zara is one of the leading brand in Fashion and clothing retail industry, the
products and clothes selling in the market by Zara are very much different on comparing to
quality and unique design of the products offering by Zara. The product quality is one of the
biggest reason behind such great success of Zara.
 Price:- Price is one of the most important marketing mix it is basically the amount which
is paid by the customers to use or buy the products and services offered by the company.
It can act as the most crucial way to determine the firm's profit making and its survival in
the market. Price adjustment has very big impact on marketing strategies and also affect
the growth and product sale in the market.
Pricing helps to shape the perception about the product in customer's mind, low prices usually
put the image that the products are inferior or of low quality as compared to other products in the
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market. Similarly, if the products is having higher prices than its actual quality or as compared to
other same products in the market, customers will value their money over those products.
Organisation should be sure and examine the other competitors pricing and price their products
accordingly and continuously update those prices. Pricing of products basically done on the basis
of the amount which is spent to produce the product, analysing how much amount the customers
are ready to pay for that product and adjusting the amount of profit rate according to market
situations (Thomas, 2011).
Pricing of the products offering by Asos is slightly lesser than the price Zara is offering for their
products which makes their image in the mind of some customers that the quality of Asos
products are inferior as compared to Zara.
Prices of the products offering by Zara are quite higher, as compared to their other competitors
but, because of their bigger brand name and better quality customers are ready to pay the amount
company is asking for their products. Zara mainly put their focus on low costing in
manufacturing of their products which also gives them liability to increase or decrease the price
rate of their products as according to market conditions as compared to other brands in the
market.
 Place:- The placement or distribution of product to the potential buyers which is easily
accessible. This comes by analysing the targets of company and the demand of the
market. Understanding and analysing the demand and the market situation the positioning
of products and distributing channels at most efficient place. Distribution of products and
its strategies includes Intensive distribution, Exclusive distribution, Selective distribution
and Franchising (Tripathi, 2013). The place of distribution and product stock is decided
on the basis of all these distribution strategies.
Company should focus on these strategies while distributing their products such as, the place
where clients or customers are willing for company's products and services, deciding the place
where customers usually used to prefer their buying such as shopping malls, regular shops,
supermarket, Online store or any other.
Zara is selling their products in almost every possible source they can, potential
customers can buy their products from every offline as well as, online sources such as their own
website or by using other shopping engines. Zara is also offering their products from offline
source as well and this allows them to contact their customers directly and sell variety of
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