E-commerce Report: An Analysis of Zara's Online Business Strategy

This report provides a comprehensive analysis of Zara's e-commerce operations, examining various aspects of its online presence. The report begins with an introduction to the e-commerce landscape and its significance for businesses, followed by an overview of Zara as a company, including its financial performance and industry position. The analysis then delves into Zara's website, evaluating its organization, design, product presentation, navigation, security, and ease of purchase. The report also explores Zara's communication strategies, search engine optimization, affiliation programs, and technology infrastructure. The conclusion summarizes the key findings and offers insights into Zara's successful e-commerce strategy. The report also discusses the advantages and disadvantages of e-commerce and provides a critical analysis of the Zara website to understand the dynamics of the e-commerce business.

Running head: E-COMMERCE
E-Commerce: ZARA
Name of the Student
Name of the University
Author’s note

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Table of Contents
Introduction....................................................................................................................................................2
Discussion......................................................................................................................................................3
About the company....................................................................................................................................3
Financial performance...............................................................................................................................4
Industry overview......................................................................................................................................5
About the website......................................................................................................................................5
Organization and Consistency...................................................................................................................6
Design........................................................................................................................................................7
Product page...............................................................................................................................................8
Navigation..................................................................................................................................................9
Security....................................................................................................................................................10
Ease of purchase......................................................................................................................................11
Communication........................................................................................................................................12
Search engine strategy.............................................................................................................................12
Affiliation.................................................................................................................................................13
Technology..............................................................................................................................................13
Conclusion...................................................................................................................................................13
References....................................................................................................................................................15

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Chapter 1
Introduction:
With the advancement of technology and changes in the societal and lifestyle trends, business
organisations are adopting to cater to the needs and requirements of the target market. One of the biggest
revolutions in the business front because of technology is the popularity and growth of the e-commerce
business. For most business organisation it is one of the most important objective is to cater to the need
and requirement of the customers, this has made e-commerce gain popularity in the past decade. E-
commerce or E-business can be defined as the process by which a business institution uses technology to
meet and initiate transaction. Buyers and sellers meet on a platform, which is driven by technology.
Amazon, E-bay, Alibaba etc are some of the pioneers in the e-commerce business model; setting
benchmarking milestones for the companies who are new in the industry. This model is based on
technology and hence the lifestyle and societal factors play an important role in the business because
acceptance of technology is also one of the major aspects. Hardware devices and connectivity with
communication medium is important part of the. E-business or E-commerce is the process by which
organisation uses the platform of internet to base their operation (Laudon & Traver, 2013).
This business model has distinctive advantages and disadvantages. Advantages of e-commerce,
there is no geographical boundaries to the reach of the model as a person can use the website and the
services from any part of the world. The website is available for the buyers on a 24*7 basis as like
physical stores there is no time restriction as well. The process of buying and selling of the items is easy
and much smoother compared to retail business. Form the business perspective there is not cost of setting
up stores hence there is capital investment in the initial position is low. The customers can choose their
product without having to move from one place to another.

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Some of the disadvantages of the process include the business requires a wide range so
prerequisites without which it becomes inaccessible. There is also a major reliability issue with the
customers as they are mostly used to buying things from the physical store that allows to check the
product by observing them physically, in this process the customer gets a pictorial representation of the
product which may not be suffice for some. Lack of knowledge among the customers in using the
technology is also a major barrier in this industry.
In this assignment, a critical analysis of the Website of ZARA will be held in order to
understand the dynamics of the e-commerce business website.
Discussion:
About the company:
Zara is a very popular brand that is highly praised and demanded by people from various parts of
the world. With the sole objective of being the number one fashion retailer in the world, Zara aims to feed
the world in need of class, fashion and style. The clothing and accessories retailer brand was primarily
based on Spain that was founded by the couple Amancio Ortega and Rosalia Mera. The company was
brought into the market under the domain of the Inditex Group (Zarahome.com, 2018). The Inditex
Group, being a multinational conglomerate, has about 10 companies under its umbrella that specialize in
clothing. Zara has been very effective in maintaining customer satisfaction and involving their
preferences that has led it to reach a unique position. With its marvel performance, Zara has been able to
be the leading apparel company in the clothing industry as is found in the present market. The product
lines of the company have three sections commencing to men, women and children respectively. It has
more than 1700 operational stores and also include an online store that functions all over the world
(Zarahome.com, 2018). It possesses most of its stores in about 88 countries that includes United States,
Europe, Asia and others. Zara has been recognized as the “fashion imitator” that imitates the seasonal
trend and provides fashion trend in accordance to that in the minimum time possible for it. It has been

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analyzed that Zara produces about 10,000 designs compared to the 2000-3000 designs produced by its
rivals. Thus, it becomes able to maintain parity with the changing tastes of the customers who need not
shift to any other brand to suffice their choices. It becomes able to meet the expectations of the customers
that accumulatively bring it greater success. The company is highly recommended because of its modern
and unique designs in clothing that has a promising quality (Escobar-Rodríguez & Bonsón-Fernández,
2017). People who are fond of fashion are very much attracted towards the brand. Moreover, the apparels
have an affordable price that has made the company a popular one among people around the countries.
The CNN has connoted Zara to be the Spanish Success Story and many designers claim it to be the most
devastating retailer in the global market. Forbes has ranked Zara 53 in its brand ranking and the brand
value has been assessed to be worth 10.7 Billion dollars (Ft.com, 2018). The brand has been able to stay
out of any controversies and its remarkable performance over the years has made it a highly preferred
brand. The healthy culture that it promotes along with the humble nature of the retail brand has led Zara
to operate and prosper with more colors and dignity in the global market.
Financial performance:
Zara has a share of about 80% of the total revenue of the world’s biggest fashion retailer, namely
the Inditex Group. The brand has been able to raise its net earnings by 18% that accounts to €654m.the
company has been able to increase its international presence rapidly that has enabled it to have about
7,385 stores in 93 nations (Ft.com, 2018). The online retail site of the brand has also started to function
for the countries of Thailand, Singapore, Vietnam and Malaysia, which it did not have previously that has
accelerated to its greater growth. The annual report shows that there has been constant rise in the
economy of the company ranging about 10-12% increase with a steady growth in sales accounting to
about 12.5% quarterly. In a single quarter, the company has been reported by the Inditex Group to have
faced 18% rise in its earnings globally (Ft.com, 2018). The accounting policies and capital management
that Zara incorporates within it are very effectively managed. With high maintenance of taxation, and
steady flow through supply chains and meeting the demands and expectations of the people around the

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world, Zara has been able to attain stability in its financial position that serves to be a very effective base
for the company to perform smoothly in the apparel industry in the global market scenario.
Industry overview:
Zara is recognized as the leading fashion brand in the apparel industry. The industry serves to be
both advantageous as well as have certain aspects that always keep the brand in pressure. This is the chief
reason that the brand is constantly engaged in the production of modern designs with time. Having low
barriers to entry, the industry that Zara serves brings in many rivalries for the company. The capital
investment to enter the industry is relatively low that brings in many apparel companies. However, since
buyers do not have enough bargaining power, it serves to be a positive aspect for the company to opt for
profits. People coming from the middle and upper-middle classes always tend to buy clothes and spend
discretionary income on buying clothes. Thus, the growth of the industry as a whole remains relatively
constant. The suppliers also have a low bargaining power and the companies also get cheap labors that
become more profitable for it. As a whole, the competition that Zara has as compared to its rivalries is
very unpredictable. For instance, in Spain, Zara has a market share of 4% whereas in Sweden, the brand
H&M has 10% share. The company also has the potential threat of consumer retention and switching of
brands that can affect its growth negatively. However, the global apparel chain of Zara that has a high
value research and unique designs with great marketing operations and smooth performance has rendered
to it a position yet to attain by other brands that are functional in the apparel industry.
Chapter-2
About the website:
The company use the website to reach the online customers and extend their source of
information to the E-world. The company uses this technology to market their products, reach the
customers in a more efficient, and smooth way. Likewise, the official website of an international brand

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Zara has an official website to reach their online customers. The company website consists of all the
products that the company want to show to their online customers. It also has a secret section that is kept
separately only for the online customers and that has not been seen by anyone in stores. This collection is
specially kept for the online customers of Zara. It was recently discovered that the company sells
loungewear. The commonly selected items from the product list are floral pants, dresses, sweaters ranging
from $15-$130. The website has a bargain section offering low range products, which is not provided in
retail stores. They also have a collection of home ware items, slippers, nightwear and T-shirts. The
website highlights the new arrivals in Zara collection, the on trend products, high selling products and the
discounted products. This helps the customers to chose the product of their chose and purchase as per
their requirement.
Organization and Consistency:
Organization of websites serves to be an important aspect for online retail markets. The entire
process need to function in a way so that it is convenient for the users or the customers to be precise and
simultaneously have cohesion so that it reaches to the customers effectively. If the companies have
website that are poorly constructed and managed, it results to a lack of customer usage of the site who get
frustrated with the disorganized websites (Kotler, 2015). Moreover, a consistency in the theme of the sites
helps the customers to navigate fluently, tracing the key elements that must be highlighted in the sites.
Thus, designing the sites is also a vital part for website retailing.
Considering the website of Zara, the site has the images of its clothes, bedding and accessories
flashed in the page. It has the list of products on the home page itself at one side so that the customers can
easily find the category of items they are looking for in the brand. On selecting the desired item, the
customers are able to view the items from different angles that help them to clearly depict the items. The
price of the items is also given along the images that help the customers to filter out their desired
products. However, sometimes with the continuous flash of various images that occurs in the navigating

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process, the site sometimes look very cluttered and diverging. The company also forecasts multiple items
relating to the product selected by the customer on one single click that guides them with better products
of the same genre.
The consistency of the site of Zara is found in the continuous image flash that occurs in the site.
The navigation bar directing the customers to opt for more items or go to the other options such as
payment page and shop more options helps to maintain its consistency (García-Álvarez, 2015). Bedroom
décor, furniture, lingerie wear, beachwear, tableware, fragrances and other products that the brand sells
online are all designed with the same template that shows the uniformity and consistency of the website.
However, the major problem that the customers face in navigating the site is because they have to
get back to the category page every time they want to add products in the cart and scroll over the
immense use of images that often serves to be irritating for the customers. Thus, they log out of the site
losing the interest of searching their products.
Design:
The design of the site enables the customers to recognize the products and purchase as per their need.
The web design determines the e-commerce strategies of a company. If a company is giving offers and
discounts them this web page hi-lights the offers and informs the customers about the following
information. The web paeg improves the company reputation and technical standard of the company, thus
the market demand of the company increases. It is very important to create a well-framed web page to
seek online customers attention and market the product on a large scale. The web page is visible to the
whole world, thus marketing the product in a worldwide scale. The mentioned company Zara needs to
modify and improve their web page design quality. There are unwanted videos and audios in the site
making the customers angry and frustrated. Many times these videos make the customers shut the site to
avoid the disturbance from the video clippings. Few major issues faced by the customers for a improper
designed page are:

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 The product images slide too fast and hence the customers cannot view the products properly.
 The videos consists too loud music that can embarrass the customers in a public place.
 The menu overlaps the images that give an incomplete and untidy look to the page. The
designing of this page has to be improved to get a clear view of the image as well as the menu.
 There is no events tracking system
 The page names are excessive long and difficult to reference back.
 They are using IBM WebSphere Commerce as website platform, which has a horrible URL
structure.
 Few important website elements not being tracked are product basket, shopping guide,
interaction with Lookbook, magazines, option for product information.
Product page:
The real goal for a website is to create a demand for the product in the market. The products that
has to be hi-lighted to the customers must be well designed and framed to seek customers attention. Zara
is concerned about the way they deploy the updated information technology to facilitate their exchanges.
The product page of Zara consists of all their products starting from dresses, shoes, nightwear, sweaters
and many more products. The products are of good quality however, the prices are a bit expensive for this
brand. They have good collection of dress, shoes and accessories starting from affordable ranges to
premium range and high quality. The product consist of the products, with their different colour
availability, size, designs. The page has an option to filter the product on the customers basis, the
customer can select the products on the basis of their price, colour, size, discount given in the page (Jung,
Xiong & Sato, 2013). The product page has a special option for secret collection, this section consists of
the special collection kept by the company only for the online customers. The page needs to be more
synchronized and well framed to make it easy for the customers to purchase their products. In their
product page have a variety of collections bedroom products including flat sheets, pillowcases, quilts,
bedspreads, blankets, cushions, rugs, valances, protectors. They have a collection for bathroom products

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including towels, bath mats, bathrobes, baskets, bathroom curtains. They have a collection for table ware
including products like tablecloths, placemats, glassware, kitchen textile, serving dishes, coffee and tea,
coasters, napkin rings, bread plates. They also have collections for kids wear, loungewear, linen selection
and special prices. This special price includes the discounted product for the customers who demands for
a bargain with the company products. This option is only available in the online stores of Zara and not in
the retail stores.
Navigation:
The website navigation is an important part of web designing. The web navigation helps the user to
find the information that is required by them. The web page appears to be incomplete without the
navigation bar. The navigation key indicates that the website is holding some knowledge and can fulfil
the queries that the customers is seeking from that website. It can spread the customer’s research and
helps the customers to search and explore the production extend of the individual company. The Zara
website has a easy navigation system. The home consists of the product headings in the left hand side of
the page. If the customer clicks the heading, the sub headings are opened and the customer can view the
in detailed products available under that category. The customer is then navigated to the product page
where they can find the product details and variety.

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The above image shows the product page where the detailed information’s are given for the bedroom
products. The left hand side of the page consists of the variety of products available and the centre of
the page has the images of the customer required products along with their individual name and
price. The customer can select the product and save it in the basket and then proceed further for new
selection or buy the selected product. The procedure becomes easier for the customers for the ease in
navigation.
Security:
Cyber crime is a common threat to official websites in today’s world. The risk to cyber crimes are
increasing as the world is getter more dependent on internet usage and accessibility. The companies that
are using websites and internet access to transact business has to make sure risk free environment to
prevent their customers from suffering and also preventing the company from an bad image. Just like
other reputed brands Zara is also using their official website for transacting business. They are committed
to their customers for securing their password and credit card information’s. The company enables its
own security system by providing the user password to recognize their customers and keep a track of

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them. They also remind their customers to change their password after a certain interval of time. The
credit card information’s are encrypted. The payments through master cards and visa card are transacted
through secured systems. The bank confirms the authority about the card then only the company charges
from the customer’s card. They have a separate section for clarifying the customer’s security payment
system (Sun, 2013). The company tries to keep a well-framed security system however, there are few
issues faced by the customers. It has been found in reviews that the customer’s credit card was used
fraudulently and the customer’s computer has identified this site as an unsafe site. Thus, there is a suspect
that the hacking site was Zara’s official website. However, there is a dual situation for every system. The
company has to develop a better security system to make sure that the customers are not facing any issue
regarding their transaction as it can damage the company reputation and online trade of the business.
Ease of purchase:
The e-commerce system enables the customers to purchase the products sitting at home. The
advanced technology has helped the generation to improve their level of comfort and ease to the market,
thus enabling to shop by not being physically present at the stores. The introduction of e-commerce and
advanced technology is helping both the entities of business. The salesperson as well the customers are
using this system to sell and buy products. This system has helped to improve the business skills and
produce a lot variety of stock to the customers in a short span of time. the online stores help the customers
from a far extend to view the product and receives the product knowledge. The customers can buy
product from different culture and country sitting in one single place. The same has happened for an
international brand Zara. The company is now easily available to the customers who were not well aware
of this brand or may be could not reach the brand due to unavailability. The customers are able to
purchase their products, receive the information about the offers and discounts of the products, the
customers are getting information about the new arrival products and can buy them accordingly. This is
increasing the company sale in the international market and bringing a huge profit to the company
(Katawetawaraks & Wang, 2013). However, the web page needs to be well designed and maintained for a