Detailed Analysis of Zara's Marketing Strategy and Recommendations

This report provides a detailed marketing strategy analysis of Zara, a leading fashion retailer. It begins with an overview of the company and its global presence. A PESTLE analysis examines the political, economic, social, technological, legal, and environmental factors impacting Zara in the UK market. Porter's Five Forces are then applied to assess the competitive landscape, including the threat of new entrants, competitors, substitutes, and the bargaining power of suppliers and buyers. A SWOT analysis identifies Zara's strengths, weaknesses, opportunities, and threats. The BCG matrix is used to evaluate Zara's product portfolio, categorizing products as stars, question marks, cash cows, and dogs. SMART objectives are defined to guide Zara's marketing efforts, followed by an application of Ansoff's growth strategies, including market penetration, market development, product development, and diversification. Finally, the report discusses the marketing mix (product, price, place, and promotion) and provides recommendations for Zara's future marketing initiatives. This analysis aims to provide insights into Zara's market position and suggest strategies for continued success.

Marketing Strategy

MARKETING STRATEGY 1
Overview of the Organization
Zara is a fashion company which offers the clothes, accessories, shoes, perfumes, swimmers and
beauty. The company was established in the year 1975. It is the world largest apparel retailer in
the world. It operates in various countries in the world (Zara, 2018a).
PESTLE Analysis
Political  In UK, the members of Parliament
made 18 recommendations to enhance
environmental and working practices in
the fashion industry. The plans came
from the Environmental Audit
Committee (EAC).
 It has been evaluated that 300000
tonnes of clothes export in different
countries. It states that the
government of UK supports the
fashion industry which is beneficial
for the company (BBC, 2019).
Economic  UK has high developed and market
oriented economy.
 It is also the fifth-largest national

MARKETING STRATEGY 2
economy in the world in terms of GDP.
 High economy refers the high willing
power of consumers due to which the
demand of consumers is increases.
Social  Clothing is always been the big
business for UK as the demand of
consumers is high. The economy of the
company is strong due to which the
willing power of consumers is high.
 The company also has high risk as the
demand of consumers of UK is
changing with new trends and fashion.
Technological  Technology is the major contributor of
the UK economy.
 It has been evaluated that the
government of UK invested £28bn in
technology in the financial year 2011
(The Telegraph, 2017).
 Advance technology helps the
organization to provide the more
quality of product in less time (Tech,
2018).

MARKETING STRATEGY 3
Legal  There are various laws are developed
by the government of UK in order to
frauds or to protect the consumers.
 Employment Act 1996 was introduced
by the government of UK just to protect
the employees. It is necessary for the
company to follows these laws for long
time survival.
 Electronic commerce regulations 2002,
Sales of Goods Act 1979 are the acts or
laws introduce by the company (Gov,
2012).
Environmental  Government, councils, local
communities and the other top
management authorities to spread the
awareness in the country.
 In order to spread the awareness among
the consumers, the government of UK
uses the advertisement tools such as
newspapers, magazines, articles, and
charities activities.
 The companies of UK have to

MARKETING STRATEGY 4
implement these rules and regulation at
the workplaces with the motive to
retain the large number of employees.
Porter’s Five Forces
The threat of New Entrants
It has been seen that the threat of new entrants is low as the fashion industry requires high capital
to establish the business in the market. Another factor that affects the new entrants is high
goodwill of existing companies in the market. It is difficult for new entrants to beat the existing
companies in competition.
The threat of competitors
The threat of competitors is high as it delivers the similar services to consumers as per its
competitors such as H&M, Vera moda, and the others. Although, the company delivers the
unique designs but others companies also have some unique designs that are also premium. The
brand image of the companies is high as the companies deliver the quality product to consumers
(Kabue, and Kilika, 2016).
The threat of substitute
The threat of substitute is low as there is no other product that can replace the clothes. However,
the substitute of the company is its competitors who supply similar products to consumers. It is
observed that threat of substitute is high in terms of competitors such as GAP, H&M, and the
others.

MARKETING STRATEGY 5
Bargaining Power of Suppliers
It has been evaluated that the bargaining power of suppliers is less as they provides the services
to consumers at the high price. There is huge number of small or big companies who operates in
fashion industry due to which there are many suppliers who provides the raw material. The
company has the opportunity to switch with new suppliers in fewer prices (Stindt, et. al, 2017).
Bargaining Power of Buyers
Negotiation power of buyers is also high as they have many options to purchase the product from
various companies. As discussed above, there are many companies that operate in the fashion
industry due to which the consumers have the opportunity to switch with the other companies.
SWOT Analysis
Strength The company has high brand image in the cloth
retailing industry.
The presence of the company is strong at the
globe level to provide the services to
consumers.
Zara provides the fresh design to consumers
due to its brand image is also enhance.
As the company has strong presence in the
market due to which it also has superb supply
chain to distribute the services (Zara, 2018a).

MARKETING STRATEGY 6
Weaknesses Zara does not advertise their product in the
market.
It is observed that the company does not
specialize for a particular age or category of
people.
Limited services provide by the company. It is
observed that the company has the strategy to
keep the limited stock so that the consumers
visit the stores to check the latest stock.
But the company faces the challenges just
because of this strategy as the consumers shift
their demand to the other company.
Opportunity Zara has high brand in the market and it also
has strong presence in the market that is why;
it has the opportunity to grab the online
business.
The company also has the opportunity to
expand the business at the international level.
Threat Zara has high threat of its competitors as they
deliver the large number of services to
consumers and also promote their own product
in the market through various tools.
It is observed that the company also has high

MARKETING STRATEGY 7
threat of losing consumers as it delivers it kept
the limited stock (Zara, 2018a).
BCG Matrix
BCG Matrix is a corporate planning tool, which is used to evaluate the strategic position of the
organization (Jurevicius, 2013).
Stars
Fashion Denim, Fashion Jersey and the unique collection of accessories and bags of the
organization are the star item as they earn high revenue for the company. The company retains
the higher position in the market with the help of marketing strategies.
Question Marks
In the factor, those are products are considered which is weak in terms of gaining high revenue
and market share. The product of Zara has high demand in the market but there are some
products those are considered as question mark for the company such as Bershka, Stradivarius
and the others. These products of the company can grab the market share in near future if the
market demand and trend of consumers will change.
Cash Cow
Women and Men are considered as the stars for Zara as they are main cash generator who
generates the high revenue. It is observed that the products of women and men are sold in large

MARKETING STRATEGY 8
number as compare to the other products of the company. The products of the organization have
9.3%, 6.8% and 6% market share (Zara, 2018b).
Dogs
In Zara products deliveries, it is observed that the inner wears are the dogs for the company as
the company invests the huge amount in it but it does not get high return. The company does not
get the high amount of revenue from the inner wear products as there are other companies who
provide the high quality of services to consumers due to which this market does not grab
easily(Zara, 2018b).
Question Marks Stars
Poor Dogs Cash Cows
SMART Objective
Zara has to set the objectives to grab the high market share in the market in SMART way (CFI,
2018). These are three objectives and these are:
 The first objective is to increase the sales by 10% in the end of 2 years
Women
Men
Inner
Wears
Stradivarius
Bershka
Fashion
Denim
Bags and
accessori
es

MARKETING STRATEGY 9
 The second objective of the company is to product diversify by 20% to gain the high
position in competitors
 The third objective of Zara is to train the employees for advance technology to grab the
online market share by 20% in the end of 1 year
Ansoff Strategies
Ansoff Matrix has four growth strategies such as Market Penetration, Market Development,
Product Development, and Diversification. These strategies help the organization to increase the
sales and to grab the high market share in the market. It is an appropriate tool for the company to
achieve the objectives of the company.
Market Development
Market Development states the company has to sale the existing product in the new market. It
has been seen that Zara operates in different locations but it is suggest that the company has to
reach at the rural areas or the small cities to provide their clothes to consumers. It is observed
that the company can increase their sales with this strategy by 20% in the end of 2 years.
Market Penetration
Market Penetration defines that the company can promote the existing products in the exiting
market. Zara always provides the services to consumers but never advertise their clothes due to
which the customers are not aware about the new designs. It is recommended that the company
has to deliver the new products in the existing market in order to attract the consumers towards
their new designs of clothes. Providing the training of advance technology helps the organization

MARKETING STRATEGY 10
to promote the products in existing company due to which it is easy for the company to grab the
10% of online market share.
Product Development
As per this strategy, the company can develop new product in the existing market to grab the
large number of consumers. Although, Zara provides the quality and unique designs to their
customers for the higher level of satisfaction but it has the opportunity to provide the unique
designs with the accessories or it can provides footwear in the existing market so that the
consumers cannot approach here and there. It is beneficial for the company to provide the wide
variety of services to consumers in terms of diversification.
Diversification
Diversification is the strategy which defines that the new product in the new market. As per this
strategy, the company has to totally diversify their operation areas. It is observed that Zara
provides the unique designs to consumers as per the fashions and trends. As it has high brand
image in the market that is why; it has the opportunity to expand the business in new market with
the new products such as shoes, accessories, more variety for kids. This new product in the new
market helps to diversify the product with the 20% that helps to gain the higher position in
competitors.
Although, all four strategies are appropriate for the company but the diversification and the
market penetration strategy. It has been seen that the company can achieve its all three strategies
by implementing these two strategies. As per the strategies, the company can increase the sale by
10% by providing the new product in the new market. Unique designs help the organization to
gain the competitive advantage.

MARKETING STRATEGY 11
Marketing Mix
Marketing mix is a foundation model for businesses. It is the set of marketing tools that the
organization uses to attain its market objectives. The marketing mix strategy of the company
contains the four P’s those helps the organization to increase the sales or gain the high
competitive advantage such as Promotion, Place, Price and Product (The Marketing Mix, 2018).
Zara has to provide then footwear’s for men, women and kids with the high quality for
diversification. It implements this marketing mix strategy at the workplace to grab the high
market share or gain the competitive advantage in the competitive market. These are given
below:
Product
Product defines the item provided by the company to its consumers with the high quality and
new features. As per the above discussion, it has been seen that the Zara always provides the
unique designs and also manufacture their designs 20 times in a year. It is recommending that
while enter the footwear industry; it has the opportunity to provide the high quality of footwear
to consumers with its brand name. It also has to design the footwear’s in a unique pattern to
attract the consumers in every month or on the quarter basis. Unique designs and pattern attract
the consumers especially those whose choices has been changed with the changing fashion or
trend (Kotler, Burton, Deans, Brown, and Armstrong, 2015).
Price
Price refers that the company has to offer the price to consumers that helps to gain the
competitive advantage. It has been seen that Zara offers the high prices to consumers as per its
premium price strategy to grab the large share in fashion industry. The main target of the