Marketing Essentials: Zara's Strategies and Responsibilities

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This report provides a comprehensive analysis of Zara's marketing essentials, exploring its key roles, responsibilities, and strategies within the fashion retail industry. It begins by defining marketing and its importance to Zara's success, highlighting the company's customer-centric approach and ability to deliver the latest trends at competitive prices. The report details the various functions within marketing, such as product placement, market analysis, pricing, and distribution, and how these functions operate within Zara. It examines the impact of the external marketing environment, including political, economic, competitive, technological, and socio-cultural factors, on Zara's decision-making. Furthermore, it explores the interrelationships between marketing and other functional units within Zara, such as finance, HR, customer service, and production, emphasizing the significance of these collaborations in achieving business objectives. The report also discusses the marketing process, including analyzing opportunities, selecting target markets, developing the marketing mix, and managing marketing efforts, illustrating how each function contributes to Zara's overall success in the fashion market. Desklib provides a platform for students to access similar solved assignments and past papers.
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Table of Contents
INTRODUCTION
.............................................................................................................................. 1
LO-1
...............................................................................................................................................2
P-1
THE KEY ROLES AND RESPONSIBILITIES OF THE MARKETING FUNCTION........................2
M1 ANALYZE THE ROLES AND RESPONSIBILITIES OF MARKETING IN THE CONTEXT OF THE

MARKETING ENVIRONMENT
...................................................................................................... 4
P-2
EXPLAIN HOW ROLES AND RESPONSIBILITIES OF MARKETING RELATE TO THE WIDER
ORGANIZATIONAL CONTEXT
......................................................................................................6
M-2
SIGNIFICANCE OF INTERRELATIONSHIPS BETWEEN MARKETING AND OTHER
FUNCTIONAL UNITS OF THE ORGANIZATION
.............................................................................8
LO-2
............................................................................................................................................. 10
P-3/ M-3
...................................................................................................................................10
REFERENCES
................................................................................................................................. 13
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INTRODUCTION
Today, Zara is among the top fashion brand of the world. It started with a small shop in Spain by

Amancio Ortega in 1975 and now Zara has its presence in around 96 countries with more than

2200 stores worldwide (Roll, 2018). Zara has its headquarter in Arteixo, Spain and is a subsidiary

of Inditex which is the world's largest apparel retailer (Owler, 2019). Zara had been so

successful due to its products and marketing strategy. Zara is known for availing the latest

fashion in less time than any of its competitors and views fashion as a perishable commodity

(Zara, 2019).

This assignment will help to understand marketing by explaining its importance in Zara. It will

also define the marketing function along with explaining some key functions of marketing. The

assignment will then explain the roles and responsibility of marketing function in the context of

the marketing environment and how these functions relate to the wider organizational context.

It will further explain the interrelationships between marketing and other functional units of an

organization. Then the assignment will compare the ways in which Zara and H&M apply 7Ps in

their marketing plan along with evaluating different tactics applied by Zara and H&M to achieve

business objectives. In the end, the assignment will explain, produce and evaluate a marketing

plan for Zara to meet its objectives. Altogether the assignment will offer a brief understanding

of marketing in the retail fashion sector.

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LO-1
P-1
THE KEY ROLES AND RESPONSIBILITIES OF THE MARKETING FUNCTION
Marketing

As per Mark Burgess, the process of translating customers need into revenue by earning a profit

is Marketing (Burgess, 2017). Marjorie Clayman defines marketing as a process of brand

building and convincing customers about the superiority of the brand along with cultivating and

maintaining a relationship with peoples (Cohen, 2011). The essence of all the definition of

marketing says that it is a process of attracting and keeping the customers with a company so

that more revenue and profit can be generated.

Importance of marketing for Zara

Though Zara never indulges in much advertisement yet marketing plays a key role in the

success of Zara. Marketing helps Zara in targeting the right customer who has the potential to

buy Zara's products. Marketing also helps Zara in understanding the customers’ response

towards a new product and thus help it from losses of bulk production. Marketing helps Zara in

positioning itself as a provider of the latest trends at minimal prices with a customer-centric

strategy (Bhasin, 2018). Marketing helps in observing the demand of customer’s which can be

converted to profits. Since Zara is a part of fashion industry thus it needs a strong customer-

centric marketing strategy to hold its market share.

Marketing function

Among the key functions which decide the success of an organization, Marketing is the most

important one. The main role of marketing is the identification and sourcing of products which

have good prospects in a market. It then promotes and differentiates the product from other

products in the market
. Philip Kotler defines marketing as a function whose purpose is to define
the target market and observing the best way to fulfil the demand of the market to generate

profit (Eser, 2018).

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The key marketing functions
Marketing function itself is a combination of various functions. These functions include market

research, product decisions, pricing, promotions, distribution, sale, market analysis, market

segmentation, positioning, after sales services etc. A better understanding of some of these

functions in Zara will help in understanding the marketing function.

1.
Product Placement- A team at Zara spot the designs on fashion shows and selects a
potential design. This design is then tested in the market before any bulk production to

avoid losses. Based on the result of the test the marketing team then decides the

suitability of the product
(Gök and Hacioglu, 2010).
2.
Market Analysis and Research: Zara operates in the dynamic fashion industry and thus
it needs a team to understand a market before forecasting any new trend. This analysis

helps Zara in understanding the probable response from the market which can be used

for its benefits (Donnelly et al., 2012).

3.
Pricing: Zara is known for providing the latest designer wears at fair prices. This function
of Zara helps it to understand the competitive prices and setting its prices at the lowest

possible (Li et al., 2013).

4.
Distribution: Zara has more than 2200 stores to distribute its products. Inditex, the
parent company of Zara has very efficient supply chain systems which can available

products anywhere in the world in less than 48 hours. This gives Zara competitive

advantage by reducing cost and speedily delivery
(Gök and Hacioglu, 2010).
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M1 ANALYZE THE ROLES AND RESPONSIBILITIES OF MARKETING IN THE
CONTEXT OF THE MARKETING ENVIRONMENT

Decision making in a business can be affected by several factors and forces. Such forces

together form the external environment of a business. These forces can also affect the

functioning of business and are of five main types:

1.
The Political and Regulatory Environment: This part constitutes of all the rules, policies
and regulations of the government. Businesses have to strictly follow the rules and

guidelines of the government and regulatory bodies to conduct business in a country

(Spence, 2012). Failing to which might attract consequences like penalties or even ban

and prohibition of a company to conduct business. Marketing helps to understand and

follow the rules of government to properly conduct business and also maintain good

relationships with concerned authorities.

2.
The Economic Environment: This part consists of the economic factors like inflation,
unemployment, per capita income, taxation etc. Such factors have an effect on the

behaviour of the customers and thus every company has to keep a close look at the

performance of an economy to align their plans (
Jaén and Liñán, 2013). Marketing helps
in ensuring the availability of the right goods based on the economic condition of a

place.

3.
The Competitive Environment: This part consists of competitors, their products, pricing,
promotion etc. Marketing plays a big role in understanding the competitive forces and

formulating a plan to deal with them (Craig and Campbell, 2012). Marketing department

is responsible to ensure the superiority of the brand in the market segment they are

dealing to successfully exploit and hold the market.

4.
The Technological Environment: Technology plays a key role in deciding the
competitiveness of a company. The marketing department has to make sure that

competitive technology is available with the company which can give it cost advantages

to product superiority.

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5. The Social and Cultural Environment: This part consists of the social values and cultural
beliefs of a place. Marketing plays a key role in ensuring that a product is not offensive

to any segment of the society and matches with the popular beliefs of the people. This

builds an amicable relationship between a company and an organisation and ensures

products and company’s acceptability in a society (Craig and Campbell, 2012).

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P-2 EXPLAIN HOW ROLES AND RESPONSIBILITIES OF MARKETING RELATE TO
THE WIDER ORGANIZATIONAL CONTEXT

Marketing is very important for Zara to position itself in the market and avail the right products

as per the needs of the market (Kohan and Danziger, 2018). Marketing of Zara do not believe

much on advertising but on the mouth of word publicity by providing stylish and quality

products at the right prices. Marketing at Zara also involves market research which helps it to

predict the response of the market before entering any market or before launch of a new

product. The marketing department also ensures that Zara has a strong presence in every

segment including E-commerce, Kid’s apparel, Men’s and Women’s apparels, shoes etc.

Zara is the subsidiary of Inditex and works very closely with its parent company. All the goods

sold at Zara are produced by Inditex though designing and product selection is done by a team

specially assigned for all the brands of Inditex (Zara, 2019). Zara has many organizational

functions like finance, HR, Marketing, Customer service etc. and all these functions works very

closely with marketing to ensure the success of Zara.

Relation between Marketing and Finance

A good relationship between marketing and Finance ensure availability of funds for all the

marketing activities which ultimately helps in generating profit and bring returns to the finance

department (
Meunier-FitzHugh and Lane, 2013).
Relation between Marketing and HR

A good relationship between marketing and the Human resource department ensures

availability of enough employees for the activities of the organization including marketing

activities which improves the brand name of Zara and thus more people pay interest in working

at Zara for long-time.

Relation between Marketing and Customer service

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The interrelationship between marketing and customer service helps in attracting the
customers and ensuring their satisfaction by follow up and guidance which helps in gaining loyal

customers for Zara.

Relation between Marketing and Purchasing and Production

Purchasing and production department ensures the quality of the products which the

marketing department promotes. Both Marketing and Production department work integrally

in designing the product and packaging of the product to ensure good appearance and features

of the product. A good quality product helps in ensuring satisfaction which saves marketing

efforts from going to waste
(Craig and Campbell, 2012).
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M-2 SIGNIFICANCE OF INTERRELATIONSHIPS BETWEEN MARKETING AND OTHER
FUNCTIONAL UNITS OF THE ORGANIZATION

Process of Marketing

Marketing is a four-step process which helps in observing the opportunities and selecting the

target to pitch the product along with a combination of 7Ps of marketing mix. It also involves

managing the efforts to ensure achievement of business objectives.

1.
Analyzing marketing opportunities: Analyzing the opportunities in the market is the
primary step in marketing process. In this step marketing needs great support from

research department as it can conduct various surveys and researches to deliver the

necessary insight into the market which can help in observing the opportunity (Ahmed,

2014).

2.
Selecting the target market: After observing a marketing opportunity, the next process
of selecting the right target market which can not only accept the product or the

company but also have good prospects in the future. The right selection of market can

bring profits but a wrong selection of market can bring huge losses and wastage of

resources and efforts (Pratap, 2018). In making such decisions finance and HR

department helps the marketing department by observing the complications in the

marketing along with understanding the available resources which company can spare

in the new product.

3.
Developing Marketing Mix: Marketing mix is a combination of 4 key decisions like the
product to be sold, price of the product, availability and channel of distribution of the

product and promotional activities for a product. Defining the answers of these four key

question help in formulating a strategy for a
product. In this stage, all the functions of
the organization help marketing department like finance department will help in availing

the necessary funds for the promotion, production and establishing distribution along

with suggesting the necessary returns which company expect from such expenses
. HR
department helps in deciding and availing enough skilled human resources to ensure the

success of the new product (Ahmed, 2014). Production department helps in

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understanding the capacity of the company along with presenting the necessary
resources needed for the production of the new product.

4.
Managing the marketing effort: This step usually comes after the launch of the product.
This step ensures controlling of the activities from deviating from the course of

increasing the sale and customer satisfaction from a product. Customer service

department plays a key role in this step as it avails the feedback from the customer to

help in understanding the issues and grievances of the customers which can help in

enhancing customer’s satisfaction. (Pratap, 2018).

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LO-2
P-3/ M-3

Business Objectives

There are five types of business objectives. First, are Economic objectives; this includes the

objectives of profits along with others with the objectives which lead to profit like increasing

customer base, optimum utilization of resources and innovations etc. The second type of

objectives is social objectives; this includes providing quality goods to the society along with

adopting fair trade practices and contributing towards social welfare (Chand, 2019).

The third type is Human objectives; this involves employees’ economic wellbeing along with

psychological and social satisfaction which ensures employees development. The fourth type is

national objectives; this includes the creation of employment for the country, paying taxes to

serve the nation, helping the nation to become self-sufficient and promoting social justice. The

fifth type of objectives is Global objectives; this includes improving efforts of Globalization,

Improve the standard of living globally and decreasing disparities among nations.

All these objectives are very important for Zara since it is present globally and have long-term,

goals (Pratap, 2018). Aim of Zara is to improve their contribution towards the sustainable

development of its society and environment with its present business model (Zara, 2019).

Marketing Mix and its application in Zara and H&M

The marketing mix is the combination of 7 Ps of marketing, which are the product, price, place,

promotion, people, process, physical evidence. All of them play a key role in formulating a

marketing plan for any organization:

1.
Product: This element of the marketing mix is to decide the right product for the
market. Every company aims to have a diversified portfolio of products to offer the

customers. A good product strategy is built on the needs and desires of the target

market. Zara and H&M both deals in fast-changing fashion thus they have to keep

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themselves updated with new products every time (Zara, 2019). Zara changes its
products very frequently and if any product does not show good performance then they

are removed from the stores without hesitation but H&M keeps the product for sale in

its stores to avoid losses. Zara and H&M both have a diversified portfolio for women’s,

men’s and kids (Kohan and Danziger, 2018). Zara offers new trends in stores in less than

twenty days but H&M losses the race and takes time in adopting new trends and

availing them in the market.

2.
Price: Pricing is another very important part of a marketing plan. Pricing of a product is
done by keeping various factors in mind like the income of target customers, goals and

objectives of the business, positioning strategy of the business, cost of goods etc. Most

company aims to keep the prices of their products as low as possible except for the

companies who want to target a niche market. Prices of H&M are much lower than Zara

(Bhasin, 2018). Zara aims to keep the price of its products as low as possible but with

fast-fashion and continuously changing stock, it has to increase the prices of its

products. Though compared to other high-end brands, the prices of Zara are relatively

lower. Pricing strategy of Zara aims to provide better value for money to the customers

with the latest fashions and good quality (Pratap, 2018). H&M, on the other hand, aims

to keep its prices low as possible; H&M do this by holding old stocks in its stores which is

available at successive discounts. Though H&M has not been able to retain many loyal

customers as Zara due to the price sensitivity of the customers attracted by this pricing

tactic.

3.
Place: Place can be a physical location or channel of distribution where products are
available. Companies decide this cautiously as it might incur huge losses for the

company and lead to failures. H&M mainly aims at securing location at malls while Zara

prefer more individual locations. This created more competition for H&M since it has to

compete with other brands but Zara is more independent from such pressure (Kohan

and Danziger, 2018). Zara also has a very advanced e-commerce presence with many

integral features like shop locating, payment gateways etc. but H&M does not have such

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a strong inclination towards e-commerce and have very basic e-commerce presence
(Bhasin, 2018).

4.
Promotion: It refers to spreading awareness about the product in the market. H&M still
believe in paid advertising and push marketing to the market. Whereas Zara uses its

customers as brand influencers and does not get involve in much advertising which

avail low-cost promotion to Zara (Kohan and Danziger, 2018).

5.
Process: Process includes the process of purchasing goods by the customers, the
process of checkout etc. A clearly defined process helps in improving customer

satisfaction and ease. Zara has processes which favour customers ease like locating

stores, locating products in the stores and easy checkouts etc. (Pratap, 2018). Whereas

H&M demands little efforts from the customers and do not have much competent

process.

6.
People: How a company takes care of its employees who perform marketing decides the
level of efforts by employees in the company's objectives. Both Zara and H&M provide

additional discounts and offers to its employees and ensure their satisfaction in the

organization (Bhasin, 2018).

7.
Physical evidence: Physical evidence in a marketing plan includes the signs, symbols,
brochure etc. the main aim of this element is to relate the customers with the physical

presence of a business. Both H&M and Zara
have copyrighted logo and brand name and
both of them are physically present with good competitive staff which can handle

customers effectively and ensure their satisfaction in the store (Kohan and Danziger,

2018).

Every organization aligns their marketing mix based on the priorities of their business

objectives. Today companies are more concerned about their brand name and long term

competitive advantages than short term profits. This is the reason for many organizations are

investing in CSR activities to ensure good public relation and societal ties.

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REFERENCES
Ahmed, G., 2014. Marketing Process Definition & Steps. (Online) Available at:
http://www.studylecturenotes.com/mba-marketing/marketing-process-definition-steps

(Accessed on 24
th May 2019).
Bhasin, H., 2018. Marketing Strategy of Zara – Zara Marketing Strategy. (Online)
Available at:
https://www.marketing91.com/marketing-strategy-zara/ (Accessed on 24th
May 2019).

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https://www.marketing91.com/marketing-mix-hm/
(Accessed on 24th May 2019).
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(Accessed on 24th May 2019).
Burgess, C., 2017. What is a brand?. (Online) Available at:
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2019).

Chand, S., 2019. Business Objectives: 5 Most Important Objectives of Business. (Online)
Available at:
http://www.yourarticlelibrary.com/business/business-objectives-5-most-
important-objectives-of-business/23362
(Accessed on 24th May 2019).
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(Accessed on 24th May 2019).
Craig, T. and Campbell, D., 2012. Organisations and the business environment.
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DONNELLY, J.J.H. and Peter, J.P., 2012. Preface to marketing management. Mcgraw hill
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Jaén, I. and Liñán, F., 2013. Work values in a changing economic environment: the role
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Kohan, S.E. and Danziger P., 2018. (Online) Available at:
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(Accessed on
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