Zara's Marketing Strategies: An Analysis of Key Principles

This report provides a detailed analysis of Zara's marketing strategies, encompassing various elements of the marketing process. It begins with an introduction to marketing principles and then delves into a case study of Zara, a Spanish clothing retailer. The report examines market analysis, marketing strategy formulation, the marketing mix (product, price, place, and promotion), and customer relationship management. It assesses the benefits and costs of a marketing orientation for Zara, emphasizing constant improvement and focused production. The report also explores the impact of macro and micro environmental factors, such as political, economic, social, technological, environmental, and legal considerations, on Zara's marketing decisions. Furthermore, it analyzes the influence of buyer behavior on Zara's marketing activities, considering different buying situations like straight rebuy and modified rebuy. The report concludes by summarizing the key findings and emphasizing the importance of adapting marketing strategies to both internal and external environmental conditions. Finally, it touches upon product development, distribution, pricing, promotion, and the extended marketing mix, offering a comprehensive overview of Zara's marketing practices.

MARKETING PRINCIPLE

TABLE OF CONTENTS
INTRODUCTION ..........................................................................................................................1
TASK 1 ...........................................................................................................................................1
1.1 Explaining varied elements from marketing process ......................................................1
1.2 Benefit and cost of marketing orientation .......................................................................3
TASK 2 ...........................................................................................................................................4
2.1 Assessing the impact of macro and micro environmental factors on the marketing decision
of Zara ...................................................................................................................................4
2.4 Impact of buyer behavior on marketing activities of Zara ..............................................6
TASK 3 ...........................................................................................................................................6
3.1 and 3.2 Developing the product to sustain competitive advantages and arranging the
product distribution ...............................................................................................................6
3.3 and 3.4 Setting the prices as per market condition and selecting suitable mean of
promotion ..............................................................................................................................7
2.2 and 2.3 Segmentation criteria and targeting strategy ......................................................7
3.5 Extended marketing mix ..................................................................................................8
TASK 4 ...........................................................................................................................................8
4.3 Difference between international and domestic marketing .............................................8
4.1 Marketing mix for two segments .....................................................................................9
4.2 Difference between marketing the product to business than Zara customers .................9
CONCLUSION .............................................................................................................................10
REFERENCES .............................................................................................................................11

Illustration Index
Illustration 1: Elements of marketing process.................................................................................1
Illustration 2: PESTEL analysis.......................................................................................................4

INTRODUCTION
Marketing consists of different type of activities which enables the manager of
organizations with regard to identify the specific needs and demands of its respective customers
in an effective way (Concept of marketing, 2015). For the firm, it is very important that it must
gather full-fledged information about its customers. This is because, by complying with the
given type of activity enterprises can maintain the satisfaction of its buyers. Thereby, they can
perform significant improvement in their sales and profits in an effective way. This report is
based on the case study of Zara which is Spanish based clothing retailer. The report will provide
explanation all the concepts which are associated with marketing field.
TASK 1
1.1 Explaining varied elements from marketing process
Marketing is being regarded as the core function of business operation because this
function helps in spreading information about the produced product among respective buyers
(Rosenbloom and Dimitrova, 2011). In addition to this, with the help of given function only
managers of firms will be able to carry out their efforts with regard to perform significant
improvement in the sales and profits of the enterprise. In this regard, different elements of
marketing process is assessed and it is explained in below:
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 Market analysis: It is being regarded as first elements of marketing process in which
manager of firm conduct environmental analysis with an aim to gather the information
about its customers. For example, in the given steps Zara assembles the information
about the tastes and preferences of its customers. On the basis of this information, they
will organize their production operation. Marketing strategy: Here, on the basis of assessed information manager of Zara
formulate different marketing tactics such as segmentation and target market selection.
Here, products are segmented on the basis of tastes and preferences of buyers. For
example, on conducting the market analysis it has been assessed by the manager of Zara
that its buyers are demanding cloths which are being made from cotton fabric (Poolton
and et.al., 2006). In order to fulfill the given needs of buyers, Zara can take help from the
expert cloth designer team. On the basis of given tastes of buyers, cited firm will make
the decision about the segmentation of customers. In this regard, it will make the decision
that whether the cloths made from such fabric will be produced by for all buyers which
belongs to different age group. Marketing mix: In this section, Zara will formulate the marketing mix on the basis of
assessed needs of customers. Here, the manager will basically make the decision about
the product, price, place and promotion etc.
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Illustration 1: Elements of marketing process
(Source: Elements of marketing process, 2015)

 Customer relationship: In this phase, efforts will be made by Zara with regard to
maintain and establish an effective relationship with the customers. In order to perform
this, different technique of promotion can be used by it (Marshment, 2009).
 Implementation and control: Finally, at the end manager of Zara will carry out the
implementation of all the marketing strategies which it has framed earlier. However, with
an aim to assess the effectiveness of the marketing strategy it can take help from the tool
KPI (Key Performance Indicator).
1.2 Benefit and cost of marketing orientation
Marketing orientation is the type of business model which rely upon the philosophy of
carrying out the production of goods and services as per the assessed needs and demands of the
buyers (Meaning of marketing orientation, 2015). From the given case, it is identified that firm
has the mission that is to satisfy the desire of customers by giving them high quality of goods and
services. This indicates that the firm's mission statement reflects the elements of marketing
orientation. In this regard, it can be said that there are some benefits and costs associated with the
concept such marketing orientation which is being followed by Zara. The company uses the
given orientation with an aim to make the production of product as per the needs and demands of
its buyers. Here, it is through this way only Zara maintains the satisfaction of its buyers and
thereby gains the benefit in the form of increased profits and sales. The detailed explanation
about the same is depicted in below:
Benefits of marketing orientation for Zara Constant improvement: It is being regarded as one of the most significant benefit which
will be gained by Zara by complying with the practice such as marketing orientation.
Marketing orientation helps in promoting the culture of experimentation. Thus, it
provides opportunity to the manager of enterprise with regard to carry out continuous
improvement in the existing process and operation of company (Lilien, Rangaswamy and
Bruyn, 2013). Focused production: The production activity of the firm will also improve with the help
of marketing orientation concept. This is because, here firm will tend to carry out the
production of goods and services as per the assessed needs of buyers. This helps in
enhancing the satisfaction of customers in an effectual way.
Costs of marketing orientation for Zara
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 Cost associated with Extensive research: In order to identify the needs and demands of
the buyer's manager of Zara will have to perform the extensive research. This leads to
raise the cost of company. This is because, in order to perform extensive research firm
will have to hire expertise personnel from different private marketing firm. Thus, in the
given activity enterprise will require sufficient amount of time as well as money (Lee and
Yoo, 2012). Hence, it is being required by the firm that it should consider the given factor
while adopting the marketing orientation approach.
TASK 2
INTRODUCTION
The given section of the report will give description regarding different macro and micro
factors which lead to affect the operation of firm. In addition to this, the report will also
showcase the impact that buyer's behavior have on the marketing operation of Zara.
2.1 Assessing the impact of macro and micro environmental factors on the marketing decision of
Zara
The marketing decision of Zara is impacted through different macro and micro
environmental factors. Here, in order to analyze the impact of macro environmental factors
assistance has been taken from the tool such as PESTEL analysis. The detailed description about
the same is depicted in below:
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 Political:It includes the elements such as change in the rate of interest and taxation etc.
These factors have their impact on the marketing decision of enterprise. For example,
marketing manager of Zara has taken the decision for placing the ads about its company
in one of the most expensive advertisement mean such as television. The decision as
being taken by the manager will be impacted when government of nation increase the rate
of taxation upon the use of given mean by the firm. In this condition, firm will have to
adopt some other economic mean (Dibb and Carrigan, 2013). Economical: The pricing strategy as being selected by Zara is affected through economic
condition prevailing within nation. For instance, Zara has taken decision for increasing
the prices upon its products. The decision of firm will be impacted when purchasing
capacity of citizen is impacted due to recession. In the given circumstances, firm will
have to change its pricing tactic. This takes lots of time and money of enterprise. Social:The changing tastes and preferences of customers also cause necessary impact
upon Zara marketing activities. Here, before making the decision about the product which
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Illustration 2: PESTEL analysis
(Source: PESTEL analysis, 2015)

needs to be produced by firm, manager of cited corporation must gather information
about preference of buyers. However, if not gather then sales and profits of firm will be
impacted. Technological: It is also required by the firm that it must comply with the latest tools and
technologies with an aim to spread information about the produced product. If given
thing is not followed by Zara at that time it will become difficult for it with regard to
attract large number of buyers towards the firm in an effectual manner. Environmental: It is also essential for the corporation that it must show its concern
towards the environment. This is because, if not shown then in the given circumstances it
will become difficult for enterprise with regard to build up the positive image in the eyes
of its buyers in an effectual way (Breton and Martín, 2011).
 Legal: The marketing decision of Zara is also affected when it will not follow all the
legal laws and regulations which are associated with the promotion of product in market.
Besides this, micro environmental factors are also identified which leads to possess
significant impact upon the marketing decision of Zara. It includes the individuals such as
supplier and employees of company. For example, with an aim to promote the product Zara has
launched the offer that it will deliver the demanded product to the buyers within given specified
time limit. This promise cannot be fulfilled by firm if its supplier does not deliver the raw
material to them within particular time frame (Belohlavek, 2008).
2.4 Impact of buyer behavior on marketing activities of Zara
Different type of buying situation causes significant impact upon the buyer's behavior.
Due to this, the marketing activities as being carried out by Zara is impacted in both positive and
negative manner. Different buying situations is depicted in below: Straight rebuy: It is the type of buying situation in which buyers repeatedly purchase the
goods and services of organization. Here, the buying behavior of the buyers is influenced
through its product experience. For example, customer has purchased products from Zara
shop and has the bad experience of shopping due to the poor quality of cloths. Then in the
given circumstances, buyer will not again take initiative with regard to purchase product
from Zara shop (Ding, Eliashberg and Stremersch, 2014). In this situation, it became
difficult for the enterprise with regard to attract such customers to their shop even after
using varied means of advertisement.
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 Modified rebuy: In this situation, the buyer behavior is influenced through number of
factors such as price reduction and changes in the terms and conditions of products etc. In
this condition, customers carry out comparison between the products which is being
offered by two firms. On the basis of this, it makes the selection of that organization
which suits its pocket. Thus, with an aim to influence such buyers, Zara has to give
detailed description regarding its product while framing the advertisement. However, if
not given then sales of firm will be impacted in a negative way (Culliton, 2008).
CONCLUSION
From the given section, it is concluded that it is very beneficial for the firm that it should
make the decision as per the conditions which are prevailing in the internal and external
environment of company. This is because, if it is not done then an appropriate marketing
decision will not be taken by Zara.
TASK 3
EXECUTIVE SUMMARY
It is important for the firm that it should plan its marketing tactic in an effective manner.
In this regard, marketing mix approach plays very important role. This is because, with the help
of given method Zara can set the direction of its marketing team towards right direction.
Thereby, it can get the benefit in terms of attaining the marketing goals and objectives in an
effectual way.
3.1 and 3.2 Developing the product to sustain competitive advantages and arranging the product
distribution
The product such as winter clothing range of Zara must be developed in such a way that
it will help enterprise with regard to sustain the competitive advantage in the respective market
in an effective way. For example, in order to create differentiation between Zara and its
competitors product focus will be carried out upon the quality of product. In this regard, high
quality of woolen will be used by the firm with an aim to given an immense experience of winter
clothing to its respective buyers. In addition to this, soft and light woolen fabric will be used with
an aim to fulfill the needs and demands of the Zara buyers in an effective manner (Czinkota and
Ronkainen, 2012).
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Besides this, the winter clothing range of Zara will be distributed through both direct and
indirect means. With specific reference to indirect mean, the respective product will be sold
through the outlets of firm. In the similar way, with an aim to provide convenience to the buyers
Zara can sold its product through indirect means such as firm's website. Here, with the help of
both the given mean firm can fulfill the needs and demands of its buyers in an effective manner.
Due to this, it can get the advantage in the form of increased profits and sales.
3.3 and 3.4 Setting the prices as per market condition and selecting suitable mean of promotion
For the manager of Zara, it is very necessary that it must set the prices of its product as
per the condition prevailing in market. In this regard, it can be said that it should set its new
product prices as per the market condition. For example, in the condition like recession firm
must use low pricing tactics. This is because, in this circumstance it will become difficult for the
buyers with regard to purchase such type of goods and services which are very much expensive.
In the similar way, Zara must set high prices for the product in the country where buyers have
good purchasing capacity (Madiechie, 2009).
Besides this, with an aim to promote winter clothing range of Zara different promotional
means will be used. For example, with an aim to attract old buyers ads about the product will be
placed on means such as magazines and newspaper etc. Likewise, social networking sites will be
used for the purpose to give information about the product to adult customers.
2.2 and 2.3 Segmentation criteria and targeting strategy
Segmentation is the process of dividing firm's overall market into several sub sections
(Segmentation, 2015). In this regard, segmentation criteria has been proposed for the winter
clothing range of Zara. This product can be segmented by firm on the basis of demographic and
psychographic segmentation criteria. With respect to the demographic segmentation, winter
clothing range of Zara can be divided on the basis of age group of customers. In this regard, two
age group of buyers is selected such as adult and old customers. In addition to this, with respect
to psychographic segmentation interest level of buyers will be used. Here, some buyers demand
for shiny and glittery colors in their winter cloths. Likewise, some buyers wants simple and light
colors in their winter cloths. The needs of both type of buyers will be fulfilled by Zara (Kotler,
2009).
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After performing segmentation of the target market, it is being required by the firm that it
should use an appropriate targeting tactic. This is because, selection of right targeting tactic will
help corporation in attracting the large number of buyers towards the enterprise in an effectual
way. The targeting strategies is of three types such as undifferentiated, concentrated and
differentiated. Here, with an aim to target these customers undifferentiated target market strategy
will be used. In this regard, one single promotional message will be framed for assessed
segmented group of product such as winter clothing range of Zara. For example, in order to
attract both the assessed group of customers focus will be carried out upon the quality of product.
In this regard, it is suggested to the firm that it should use the best quality of material for its
cloths with an aim to maintain the satisfaction level of the buyers. Through this way, large
number of buyers will be attracted by the firm. Due to this, Zara can attain the benefit in the form
of increased profits and sales.
2.5 Positioning strategy of Zara
The positioning strategy is used with an aim to develop the unique and an effective image
about the product in the mind of its buyers. In accordance with the given context, the produced
product can be positioned in the mind of buyers by using number of aspects such as product
benefits and features etc. Here, Zara can use the positioning aspect related with feature with an
aim to positioned the image of Zara winter clothing product in the mind of its segmented buyers.
For example, with an aim to influence the old buyers towards product following features should
be considered. For example, light material should be used and the product must be available in
huge range of light colors. Likewise, adults buyers get attracted towards the cloths which are
more shiny and glittery. Hence, the given aspect should be considered by firm while making the
production of cloth.
3.5 Extended marketing mix
Extended marketing mix has been prepared as per the new product of Zara: People: This element has its importance when firm sale its product through outlet. This is
because, it is with the help of talented and skilled employees only all the queries of
customers can be resolved by the firm in an effective manner. Thus, through this way
satisfaction level of customers can be maintained. Here, with an aim to enhance the
effectiveness of its people, Zara organizes different training and development programs
for its employees.
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