Zara Presentation_F10

Report
Passion For Fashion
ZARA
Presented By: Eva (Yihui Yan),
Sylvia (Fei Gao), Emma(Hanul Yang)
ZARA
 History and SWOT Analysis
 Global Expansion and associated challenges
 Industry Analysis and Competitors
 Short –term and long-term Recommendations
 Conclusion
ZARA
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Parent company : Inditex by Amancio Ortega
In 1975, first ZARA store in A Coruna, Spain
SPA brand, fast fashion, instant fashion
Line up – women, men, kids
In 1980, Zara started to expand globally
Unique supply chain
Zero advertising policy
1,444 stores in 77 countries
SWOT Analysis
Strengths
• Point-Of-Sales System
send information
products reflect
quick feedback
• Unique Supply Chain
3 lines work separately
designers + market experts
send designs
Zara factories produce
• Accurate delivery
use planes and trucks
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New products every two week
Make customers visit store more frequently
Prevent overused discount and sale
Get good reputation from viral marketing
Weaknesses
• Can’t meet customers’ re-buying needs
• Intense concentration on European markets
• Low brand recognitions in certain markets
Opportunities
• Potential markets
• More online shops
• Fast fashion market ; PRAV
Threats
• What if some thing happens in Spain?
• The continued rise of Fuel price
• Newcomers with similar style
The Largest Clothing Retailer In the World
Zara Global Expansion
14%
34%
23%
29%
Zara Global Expansion
• Global Expansion
- International presences all over the world
• Europe - First : Porto, Portugal in 1980
- Second: France 1990
- Third: Belgium & Sweden 1994
• North America - U.S 1989
• South America - Mexico 1992
• Asia - Tokyo, Japan 2004
• Now- Zara owns 1,444 stores worldwide in 77
countries.
Zara Global Expansion
Global Expansion Strategies
 Standardized Global Marketing
Offer standardized apparel
Lower the cost
Economies of scale
 Vertical Integration [centralized approach]
design
produce
distribute
large R&D group: > 200 people
(designers + marketing experts + production managers)
Global Expansion Strategies
 Zero Advertising Policy
0% - 0.3% of its
revenue in commercials
Use fashion shows &
posters instead
 Internet Retailing Strategy
Divisions: (official web)
Woman/Man/TRF/Kids
– Look book
– Magazine
– Catalogue
Zara in Emerging Markets
BRIC
Zara Stores in BRIC
 Brazil – 27
stores
60
Second
largest market in South America
50
40
 Russia – 37
stores, stores in Moscow, Saint Petersburg
30
Stores
 India – 3 20stores (Delhi, Mumbai, Bengaluru)
10
Joint-venture
with
27
37 Tata 3
60
0
 China – 60 stores
Brazil
Russia
India
China
Shanghai, 2006
HK, 2004
Beijing, 2007
Macau, 2007
Chengdu, 2010
Challenges
•The tightly controlled supply
chain won’t fit every
market, especially the foreign one.
Hamburg, Germany
New York, U.S.
• Different regions
have different
understanding of
fashion.
Beijing, China
• Hard to implement
the whole business
model due to joint
venture ex: India
Chanllenges
• Fierce competition
- local: MNG (MANGO)
- global: Gap, H&M, Gucci
• Glommy Economy
(Financial Crisis, 2007-2010)
Shrinkage of the fashionable
clothing sales
Industry Analysis
Fashion Capitals Rankings
• Product of the modern age
• Developed first
in Europe and America
• Consists of four levels
1. the production of raw materials
2. the production of fashion goods
3. retail sales
4. advertising and promotion
Competitors
Renvenue in 2009
Gucci, $3.06
billion
Zara, $9.55
billion
GAP, $14.50
billion
HM, $17.98
billion
Zara
HM
GAP
Gucci
Competitors
• spend more money on
advertising.
• 0% - 0.3% of its revenues
in advertising
• outsource all of their
productions
• In Spain, Zara owns 22
factories, and 50% of its
products are made by
their own manufacturers.
Competitors
• Luxury good: High-grade,
luxurious, classic style
• Fair price, fast fashion,
low-cost
• Target market:
Age: 25-40
• Target market:
Age: 18-35
mainly women and men,
kids clothing
• leather goods, shoes,
watches, perfume,
household goods and pet
supplies
Competitors
• The largest clothing company
in USA
• Focus on the Jeans and
hoodies
• The largest clothing retailer in
the world, No.1 in Spanish
Clothing Market
• Sweaters, T-shirt
• Casual, sport style
• Relatively mature
• Multi-Brands:
GAP, Banana Republic,
Old Navy
• a subsidiary of Inditex
Short-term recommendations
 Promotion activities
DIY – Design It Yourself!
 More Online stores
 Internet advertising
Long-term Recommendations
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Advertising
TV commercials
Advertisements on magazines
Activities ( involve customers)
• Differentiation
- Offer sepcialized products
uniquely designed for a certian culture/region
Long-term Recommendations
• Improve its logistics and build ECR system to react
more quickly to changes in consumption patterns
• Locate more manufacturers and distribution
infrastructures in emerging countries
• Franchising
conclusion
▷ Challenges
▷ Recommendations
• Tightly controlled
supply chain
• Different fashion concepts
• Competitors
• Gloomy economy
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▷ Global Locations:
1,444 stores in 77 countries
Advertising
Online shops
Various promotions
Improve logistics
ECR system
Building infrastructures
in emerging markets
• Franchising

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