Innovation Management Report: Zara's Business Strategies Analysis

This report provides an in-depth analysis of Zara's innovation strategies, focusing on its history, current performance, and future industry trends. It examines Zara's innovative approach to fast fashion, including its ability to rapidly move designs from concept to market and its use of augmented reality to enhance the consumer experience. The report highlights the importance of consumer feedback and technological advancements, such as virtual fitting rooms and digital clothing design, in driving Zara's success and maintaining its competitive edge. The report also discusses the broader industry context, including the adoption of augmented reality and other digital technologies by clothing companies to increase profits and market share. The report concludes by emphasizing the essential role of innovation in expanding business at a global level and creating a high-level position compared to competitors.

Managing Innovation in
Business

EXECUTIVE SUMMARY
In this report, we have covered that innovation history and organization such as move rapidly
from design to market innovation in all aspects and fast consumer feedback. This kind of
innovative idea help to increase brand awareness and productivity of organization. We have
discussed that existing innovation performance and capabilities of organization which involves
augmented virtual reality as innovative ideas for increasing the consumer attraction and
awareness towards brands. Furthermore, we have covered that industry in 2018 which includes
virtual fitting room virtual tailors, digital clothing design and customization that have adopted by
the clothing companies for increase profits and market share of business. We have discussed that
innovation is the essential for creating the new ideas and thoughts for expanding the business at
the global level. We have covered the different innovation strategies like technology
advancement, social media marketing and promoting of products and services within the
marketplace. These innovation strategies help to expand the business at the international level,
increase market share and revenue of company. This aid to create high level position as
compared to competitors and beat competition by company.

TABLE OF CONTENTS
EXECUTIVE SUMMARY ............................................................................................................2
INTRODUCTION...........................................................................................................................1
MAIN BODY ..................................................................................................................................1
Innovation history and organization ......................................................................................1
Existing innovation performance and capabilities of organization .......................................2
Industry in 2018......................................................................................................................3
CONCLUSION ...............................................................................................................................5
REFERENCES ...............................................................................................................................7

INTRODUCTION
The managing invention is the combination of handling the procedures and change
management. It involves set of tools which enable managers to cooperate with common
understanding of procedures and objectives. It allows responding to external and internal
chances and utilise creativity to introduce new thoughts processes and products (Biemans, 2018).
This study is based on Zara. It is the fast fashion retailer based on Artexio in Galicia. It is the
world largest clothing retailers. Report will explain innovation history of organization. It will
state existing innovation performance and capabilities of company. The future of industry will be
discussed in this assignment.
MAIN BODY
Innovation history and organization
Zara is the Spanish Fast fashion wearable as well as appurtenant retailer based in Artexio
in Galicia. It is primary brand of Inditex unit and world's largest clothing retailers. Company
manages up to 20 clothing collection as of 2017. The stores of Zara have apparel of men and
women and children. The products of company are supplied based on trends of consumers.
There are over 7000 stores of Zara in 50 nations which are situated across 96 marketplaces.
Company was ranked 30 on list of Inter-brand of the best international brands in the 2015. It is
well-long-familiar aspect of one of world's most innovative retail groups. With the innovation
and flexibility, the business model is unique and success of overall group (INNOVATION
LESSONS FROM FASHION LEADER, ZARA. 2019). The beliefs of the Zara is to get many
new fashions to market very fast. In order to that, company is getting the many of innovation
within the business such as:
Ideas from different places: Company can get the lost of ideas from the different places
for new products design in a year through innovation. Therefore, designing team of Zara consists
of 350 people which they are charged with making and delivering 18000 new products design in
a year. In this context, company is getting the ideas from books, magazines, twitter and other
blogs but above all from feedback from their stores (INNOVATION LESSONS FROM FASHION
LEADER, ZARA, 2019). They are attending the fashion shows and talk about fashion to get the
innovative ideas which is ongoing process of the firm. Now they are getting the ideas from the
social media and Instagram.
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Move rapidly from design to market: Through innovation, company is getting the
initial ideas to store shelf which proceeds little than four weeks. They are moved far faster than
their challengers. Firm position their goods into 5500 shops from Brisbane to Lisbon at same
time. They create very fewer accommodate for localized marketplaces. The goods of Zara are
international and sell on all five continents providing the larger economic of scale.
Innovation in all aspects: Zara is applied innovation in all the aspects of business not
only in goods. They have utilised innovative theories to streamlines and the best manufacturing,
supply chain administration, data following, stock direction, store layout and staff dealing (Wei,
Thurasamy and Popa, 2018). Company follow process innovation in their business model.
Fast Consumer Feedback: The staff of stores utilise wireless communication to shift
information each day to headquarter about the gross sales as well as stock. Accelerating data
about selling and not allow the unit to move to interest of consumers and quickly supply more of
most popular designs to they are necessary. Zara must continue to innovate, so that they are
deliberately kills them in act of creative ending. This policy also refers which consumers must
stay the stores rarely to ensure that they do not miss out on the latest products.
Innovative Strategy: The innovative strategy of Zara is stocking very little and updating
collection frequently. In this context, company is restocking with new design twice week
(Wilhelm and Dolfsma, 2018). This strategy help to encourage consumers to come back to the
shops frequently. It is the important that company has chance to quickly respond to market
demands. Company is selling the Inditex product, because Zara is subsidiary company.
Existing innovation performance and capabilities of organization
The existing innovation performance and capabilities of Zara which is process
innovation. Zara is the leading clothing company which is adopting the many innovative ideas
for competitive advantages in the market. Therefore, they have to launch augmented reality app
for shoppers in overall the world (West., 2019). The Zara can be looking for launching this app
for shoppers. An audacious window shows encourages shoppers to download Zara app available
to view the experience. After transferring, consumers will easily factor their mobile phone at
window display set up throughout the store to activate an augmented reality fashion show
experience. If consumers like who they see, shoppers can buy cloths as entire or item-by-item
with impinging of button in the app within the stores.
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In order to that, company has interpreted monolithic promotion campaign for task in
which 68 cameras were utilised on 170 square meeter stage to acquiring the experience. Zara
implement Wi-Fi network in store to promote shoppers to take benefits of their experience
(Augmented Reality Clothing Apps: Leveraging AR Technology in Some Very Fitting Ways.
2019). Shoppers are promoted with app to portion screenshots or visual of advanced technology
content on their personal Instagram and Twitters handles. The augmented reality app of Zara and
experience was evolved by Paris-based creative director and co-founder of self services
magazines together with dedicated to digital sciences and techs (Gama and et.al., 2018). With
utilise augmented reality on new app, the fast fashion of clothing Zara is bringing their clothing
to life both in their shops and online.
In addition to that, downloading this app, consumer can element camera at everything
from assistant to blank company store framework, to screen on e-commerce buy as well as
apparel will come to life on frameworks for many seconds. From there, they can click to shop
look as well as affiliated products. In press freeing from the products, they added which feature
of App is way for sharing experience on social media which promoting the consumers to take as
well as submit photos of the holograms. It is establishing virtual; connection which happens
outstandingly real. In current time, Zara disclosed their augmented reality experience across 120
flagship locations in an effort to interact with increasingly mobile focused consumers (Talukder,
2016). With this app, company is create new wave of experimental commerce which leverages
emerging technologies. This help to increase sales and making profits of business.
In addition to that, two week initiatives will enable consumers who have downloaded the
augmented reality app to keep consumer phone to certain store window or sensor within the shop
and see models come to life on their screens as well as wearing chosen products through
walking and even talking from range of company that they can buy through click. The
functionality will also enable app users to see the visuals when they hesitate their device over the
package delivered from an online Zara purchase. On the basis of sales, Inditex is the world's
largest clothing retailer. Selected company has built an empire on their ability to get new designs
into their stores in the less than month (Wei, Thurasamy and Popa, 2018).
Industry in 2018
Augmented Reality (AR) is the technology and new services which is launched by
clothing industry which gear up for digital makeover. This technology is needed to run
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international stores and online platforms of clothing companies. There is highly need for
continuous invention is important for fashion industry (Wilhelm and Dolfsma, 2018). Through
innovation and moving online, fashion brands are continuously launching creative and engaging
ways to gain grip the latest is AR that is deployed both in stores and online. The feature of AR
allows consumers to keep their mobile phones in front of sensor on the show models within
stores or designated shop windows. The consumer can continuously purchase the selective looks
through single click.
In order to that, Augmented Reality is the technique which can modify consumer
interaction with brands. Marketers can seamlessly mixture real time environment to limitless
animated design. Around 62% people feel that augmented reality can help them when they are
purchasing the clothing brand. Clothing companies are grasping the chances that have arisen as
outcome of augmented reality technology (Allen, Adomdza and Meyer, 2015). There are
different ways of utilization of augmented reality app by clothing designers and garment
manufacturing such as:
Virtual Fitting Room: Physical shops have always preserved appropriate benefit over e-
commerce shops. Consumers can seek on clothing and effort the feel for piece will originally
look on their body. Augmented Reality apps are modifying game through providing virtual
fitting the room experience. In January 2017, the app lets shoppers enter their height, weight and
body shape, so that the app can generate digital avatar which is utilised for virtual try-ons.
Virtual Tailors: Tailoring can finally become an out-of-date community as firms
acquiring an individual measurement with augmented reality apps. It is the one of most popular
of these clothing organizations is fit immunity (Augmented Reality Clothing Apps: Leveraging
AR Technology in Some Very Fitting Ways, 2019). This can capture measurement in the seconds.
The measuring information is translated across aggregate product lines and utilised to make
custom-fitting clothing. This is ideal for men, women of any height, weight and body type. This
technology is straight as measurement are comparatively simple to acquire device elements their
region and angle relative to the subject.
Digital Clothing Design and Customization: It is the major raise in the number of
clothing customized and personalized chances as apparel firms make augmented reality apps
which authorise originative. Companies are adopting mobile apps which let consumers make
tailor-make clothing that can be tried on utilising the virtual fitting room technology. The
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organizations which allows coaches and teams to design and order custom uniform design.
Consumers can design clothing through selecting style, logo and fabrics before showing digital
rendering within easy to utilise app interface.
It is the clear which augmented reality apps are modifying mode consumers shop online.
This technology is expected to be major game changer for e-commerce organizations. This will
not only become more competitive with physical stores but will also have competence to offer
more option in relation to customization and personalization. This leap in competitive can easily
justify the cots of evolving an augmented reality app (Biemans, 2018). With the augmented
reality app, the purpose of clothing companies is to engage younger people. More than 30000
consumers engaged with 3D products while utilising the app. They quite figuratively put the
shopping experience in the hand of consumers. With the Augmented Reality app, companies are
easily targeting the more consumers in front of their stores. Through this app, apparel
organizations needs to increase brand awareness in front of consumer towards company. This
app as technology and new services help to increase sales and make profits of clothing business.
Also, this can aid to increase competition within the fashion industry. Therefore, all apparel
companies must have adopted this technology in their stores. With the help of it, increasing
profitability and productivity of companies in industry.
In order to that, this technology is very effective and useful for selling of clothing and
other accessories in fashion industry. With the help of it, clothing companies are easily targeted
the consumer, increase their expectation and fulfilling their needs and wants through offering the
high quality product and services at the affordable prices (Winterhalter, Zeschky and Gassmann,
2016). This app can help to increase brand image and creating the top position in the fashion
industry. Augmented Reality App help to improve performance and productivity of clothing
companies within the apparel industry.
Porter's five force model of Zara:
Threats of new entrance:
People are looking for economical goods with the fast growing fashion industry. Zara
address problem through giving affordable prices with the high quality to reduce the threats of
new entrance within the fashion industry.
Power of supplier:
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Zara gives its suppliers with licensed contracts, so that they are stuck with needs which
leave little for variation in designs that decrease their hold on the market. The high power of
supplier since the cost to swift to another supplier.
Power of buyers:
Company spend about 0.3% of their budget on ads. It relies on words that travel from
mouth to mouth. Zara also invest research and development to communicate need and want of
consumers.
Threat of substitute product:
H&M can compete with Zara in relation to quality and reasonability. Therefore, selected
company spends large on ads and take benefits of economic crisis.
Existing competition:
There are high level of competition arising among the Zara and H&M. It is being most
affordable and fashionable beats the sales of H&M. The supply chain model is super responsive.
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CONCLUSION
This report has summarised that Zara has followed different innovation in their history
such as ideas from different places, move rapidly from design to market, innovation in all
aspects, fast consumer feedback and innovative strategy. It can be concluded that company has
launched the Augmented Reality App for increase sales and profits of business as well as
achieve the objectives of business. Furthermore, report has completed that Augmented Reality
App also help in increasing productivity and profitability of overall clothing industry. This app
aid to increase consumer attraction and their expectation towards products and services of
company.
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REFERENCES
Books and Journals
Biemans, W., 2018. Managing innovation within networks. Routledge.
Winterhalter, S., Zeschky, M. B. and Gassmann, O., 2016. Managing dual business models in
emerging markets: An ambidexterity perspective. R&D Management. 46(3). pp.464-479.
Wei, L. H., Thurasamy, R. and Popa, S., 2018. Managing virtual teams for open innovation in
Global Business Services industry. Management Decision. 56(6). pp.1285-1305.
Gama, F. and et.al., 2018. Untangling capabilities for managing the front end of innovation.
Talukder, M., 2016. Managing innovation adoption: from innovation to implementation.
Routledge.
Wilhelm, M. and Dolfsma, W., 2018. Managing knowledge boundaries for open innovation–
lessons from the automotive industry. International Journal of Operations & Production
Management. 38(1). pp.230-248.
Allen, M. R., Adomdza, G. K. and Meyer, M. H., 2015. Managing for innovation: Managerial
control and employee level outcomes. Journal of Business Research. 68(2). pp.371-379.
Online
Augmented Reality Clothing Apps: Leveraging AR Technology in Some Very Fitting Ways. 2019.
[ONLINE]. Available through. : <https://seventablets.com/blog/augmented-reality-
clothing-apps-leveraging-ar-technology-in-some-very-fitting-ways/>.
INNOVATION LESSONS FROM FASHION LEADER, ZARA. 2019. [ONLINE]. Available
through. : <https://www.destination-innovation.com/innovation-lessons-from-fashion-
leader-zara/>.
West., P., 2019. Zara AR Brings Fashionable Looks to Life in Stores. [ONLINE]. Available
through. : <https://vrscout.com/news/zara-ar-fashion-looks-stores/>.
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