A

SUMMER TRAININGPROJECT REPORT

ON

Study of Marketing Strategy of Zara

Submitted for partial fulfillment of requirement for the award of

Degree

Of

Bachelor of Business Administration

Of

Chandigarh University, Mohali

Under The Supervision Of Submitted By:

Company Mentor ROHIT KUMAR

Ms. Disha Aggarwal UID: 17 BBA 1175

(SRA Manager)

Faculty Mentors

Mrs. Kanu Nanda

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 DECLARATION
I, Rohit Kumar solemnly declare that the report of the projrct work entire ZARA
INDIA PVT. LTD., is based my own work carried out during the course of my
study under the supervision of Ms. Disha Aggarwal.

I assert that the statement made and conclusion drawn are an outcome of the report
work. I further declare that to the best of my knowledge and belief that the project
report does not contain any part of any work which has been submitted for the
award of any other degree/diploma/certificatein this University or any other
University.

_____________________

Rohit Kumar

UID : 17 BBA 1175

University school of Business

Chandigarh University

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 CERTIFICATE BY SUPERVISOR

This is certify that the report of the project submitted is the outcome of the project
work entitled ZARA INDIA PVT. LTD. carried out by Rohit Kumar bearing Roll
No: 17 BBA 1175 carried by under my guidance and supervision for the award of
degree in bachelor of business Administration of Chandigarh University.

To the best of the my knowledge the report,

i. Embodies the work of the candidate him/herself,

ii. Has duly been completed,
iii. Fulfils the requirement of the ordinance relating to the BBA degree of the
University and,
iv. Is up to the desired standard for the purpose of which is submitted.

____________________

Ms. Disha Aggrawal

(SRA Manager)

Sales Department

Zara India PVT. LTD.

VR Punjab, Mohali

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 CERTIFICATE BY PROJRCT GUIDE

This is certify that the project entitled ZARA INDIA PVT. LTD. an academic
work done by Rohit Kumar submitted in the partial fulfillment of the award of the
degree Bachelor of Business Administration from Chandigarh University under my
guidance and direction to the best of my knowledge and belief of the date and
information presented by him in this project has not been submitted earlier
elsewhere.

_____________________

Mrs. Kanu Nanda

(Faculty Mentor)

Asst. Prof. Chandigarh University

4
 ACKNOWLEDGEMENT

Unparalleled help and guidance from respected person with whom I have been
acquainted with in the course of the project support my project work. I fell
extremely satisfied to be able to acknowledge their help and support in the
completion of my project work. I express my gratitude and thanks to my mentor
Ms. Disha Aggrawal, ZARA SRA Manager and Asst. Prof. Mrs. Kanu Nanda,
my project guides whose inspiring suggestions and guidance made it possible for
me to go on with the project and had great influence on my thinking.

I am indebted to my faculty member who

had a great influence on my thinking, serving aas a positive role model and
showing their immense faith to me.

It has been great pleasure and varies enriching experience working in ZARA
INDIA PVT. LTD., Sales Department (Mohali). I wish to accord my gratitude to
each and every person of the “Training department” for their help rendered to
me.

_____________________

Rohit Kumar

UID: 17 BBA 1175

Semester: 5th

BBA

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INTRODUCTION

Zara is one of the world’s most successful fashion retail brands – if not the most
successful one. With its dramatic introduction of the concept of “fast fashion”
retail since it was founded in 1975 in Spain, Zara aspires to create responsible
passion for fashion amongst a broad spectrum of consumers, spread across
different cultures and age groups. There are many factors that have contributed to
the success of Zara but one of its key strengths, which has played a strong role in it
becoming a global fashion powerhouse as it is today, is its ability to put customers
first. Zara is obsessed with its customers, and they have defined the company and
the brand’s culture right from the very beginning.

Zara the brand which is described as possibly the most innovative and devastating
fashion retailer in the world was originally the brainchild of The Inditex Group
owned by Spanish business Tycoon Amancio Ortega.

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The Zara brand story
Zara was founded by Amancio Ortega and Rosalía Mera in 1975 in downtown
Galicia in the northern part of Spain. Its first store featured low-priced lookalike
products of popular, higher-end clothing and fashion. Amancio Ortega named Zara
as such because his preferred name Zorba was already taken. In the next 8 years,
Zara’s approach towards fashion and its business model gradually generated
traction with the Spanish consumer. This led to the opening of 9 new stores in the
biggest cities of Spain.

In 1985, Inditex was incorporated as a holding company, which laid the

foundations for a distribution system capable of reacting to shifting market trends
extremely quickly. Ortega created a new design, manufacturing, and distribution
process that could reduce lead times and react to new trends in a quicker way,
which he called “instant fashion”. This was driven by heavy investments in
information technology and utilising groups instead of individual designers for the
critical “design” element.

Zara was known, by industry players, to have an extremely particular business

model, especially given the fast-growing and quick-response industry it acted in,
where most companies outsourced garment manufacture to reduce costs and,
supposedly, enable higher flexibility. Zara, however, as a vertically-integrated
retail chain, controlled all its garment production and outsourced only “basic”
clothing that could be ordered in advance and easily adapted to future required
styles.

Marketing Strategies of Zara

Handling 7000+ stores across the world and successfully popularising 8 fashion
retail brands globally under its umbrella brand architecture has helped Inditex
(parent company of brand ZARA) in becoming one of the world’s largest fashion
retail organisations. Zara’s 1st store was opened on 1975 in beautiful European
nation Spain.

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Competitive analysis of Zara-

The fashion clothing retail industry is highly competitive with various brands such
as H & M, Mango, Gucci and many other national and international brands
fighting with each other in the same segment. However, the designs made by Zara
are based on the consumer & market feedback which they continuously work upon
to be more of the consumer-oriented brand.

Market analysis in the Marketing strategy of

Zara-

The clothing retail industry is highly competitive and the changing fads, socio-
economic and behavioural culture possess a major challenge for the companies
operating in this industry. Back end integration, high raw material cost and
advertising cost are the other factors that affect the apparel industry companies by
and large.

MARKETING AND SALES

Zara is known as the Coca Cola of fashion. Such is the craze of this brand among
the fashion enthusiasts. One of the major strength of the company is that it is able
to respond very quickly to the changing needs of the customers.

The company does not outsource its manufacturing process, making it fully in
control of the products it produces. Its unique selling preposition is to create the
latest trends. In most cases, new styles are normally available on the sales stores
within two weeks, four weeks maximum. If a product is not selling in the stores, it
is immediately pulled from the stores.

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 TODAYS PRODUCTS OF ZARA

Objective of the Study

 The purpose of this study is to describe on a specific way how Zara can
address the expenditure on global online sales by providing a customer
friendly shop portal, which allows an easy ordering process and an cost-
effective shipping and return method.
 The key of this strategy is based on every single customer who had a
satisfied experience by purchasing fashion online and who wants to repeat
online shopping.

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  Furthermore, it’s not all about increasing the economical profit; moreover to
create an added value of Zara’s brand as an intangible asset.

Research Methodology

Research methodology, selected in view of the research objectives, pros and cons
as well as details on its use will form part of this chapter. We will also outline the
research method used, information collection procedures, information sources, and
how this information will be analyzed in light of the research objectives

This chapter presents how the image developed by a brand, corporate or stand-
alone over-the-years impacts consumer’s behaviour, specifically answering the
question concerning factors customers look for in a brand, prior to purchase in the
apparel industry. Based on these factors, we can narrow down the facets available
with these two companies and how they succeed / fail in the overall strategy to
attract or carry along positive consumer behaviour, in influencing their sales

SECONDARY DATA
The secondary data is mainly concerned with raw data and published summaries
(Saunders et al. 2007). Secondary data used in this study, mainly from books in the
university library and academic weekly online through keyword search, such as
differences in marketing strategy in order to gather more material, the researchers
“ZARA in china “,” brand loyalty “to obtain more comprehensive data, and
compare the data obtained from multiple web pages to determine the authenticity
of the information about ZARA business model, sales conditions.

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 In addition, ZARA’s official website is also important way to market data.
Particularly, Saunders et al (2007) argued that when researcher conducted a
qualitative research in an organization, secondary source would facilitate a
triangulate finding depended on the primary data collected. If two or more sources
explained a phenomenon as well as it would conclude that the information is
reliable (Stokes, 2000).

PREPARING THE RESARCH DESION

Research Design

Young Designers (26 average) draw the design sketches then discuss it with
market specials and planning & procurement staff. Designs inspiration is copied

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from different sources (trade fairs, catwalks, magazines) from all around the world.
It is worth to mention that out of 40,000 designs only 10,000 are approved. This
illustrates the flexibility of ideas generation and on the other hand the huge number
of designs reflects the ability to meet almost all the fashion requirements by
customers of all ages (up to 55).
ZARA business is organized around processes not functions, to close the
information loop. All team is involved in all processes. This method minimizes the
time as decision is conducted in one room, and in direct proximity to the
information.

RESEARCH PLAN

ZARA is a member of the INDITEX group, a Spanish group. ZARA have

established its stores all over the world, Europe, America, the Middle East, Asia
Pacific and among its 5000+ stores (from the INDITEX group), Hong gong
8ZARA stores from the whole wide world.

Zara offers the latest trends in international fashion in an environment of thought-

out design. Its stores located in the main commercial areas of cities across the
Europe, America and Asia, offer fashion inspired in the tastes, wishes and
lifestyles of today's men and women. Zara’s clothing has identified a significant
underserved segment within it. Zara’s clothing is uniquely positioned to serve this
segment of the market because of its fast paced fashion ideas, its latest technology,
its efficient business strategies and its affordable prices.

Due to the growing of the clothing industry and the enormous unmet need in the
clothing market we see the long-term exppotential of Zara throughout the world.
We are visionaries who see Zara as an extreme financial launch. By achieving its
sales targets, Zara will position itself for exceptional profitability and self-funded
growth.

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ZARA’s Plan is to maintain and develop its position in the market by giving well
in time response to changing trends in consumer tastes through creating new
designs that are suitable for all customers at an affordable price.
“Zara constantly updates its range”. The company takes its inspiration from the
catwalks, targeting the fickle, fashionable young, one of the riskiest parts of the
clothing market. Unusually for a clothes retailer, Zara designs all its own clothes,
makes most of them in Spain and distributes all of them itself.

Segmentation

Zara’s segmentation of customers who are most appreciated is on a demographic

point of view, a female women up to 35 years of age, who prioritize fashion as
lifestyle, who earns up to $60k per year and graduated school. Furthermore, on
psychographic aspect Zara’s customers are ambitions and want to demonstrate it
by fancy trends, have dreams in life and want to look as a V.I.P

Targeting
One of the target markets will be China, currently 3.2% visitors by country for

Zara.com and based on the GDP growth in Asia, it will increase. The market

target defined by the visitors from China has to achieve 8% by end of 2013.

By considering the google.com and facebook.com as the major up- and

downstream on zara.com page, it presents a more specific online target market

from search engine or social media. On one hand, the upstream visitors from

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Google and Facebook have to achieve 10% and on the other hand, the

downstream to H&M of 2% has to be reduced to 1.5% by end of 2013.

Positioning:
ZARA SWOT analysis ZARA is the main success factor of Inditex's growth and
plays the leading role of the group's sales and profit. For this reason, we will go
into details with the regard to ZARA’s success factors or rather its strategic
advantages, before we start to analyse ZARA’s issues concerning its supply chain
and its possible opportunities and threats in the future. ZARA is not has not only a
different market positioning as to its direct competitors, but also has a unique
business model which is one of the world’s most successful. ZARA is positioned
more fashionable compare to its competitors but surprisingly with a relatively low
price behaviour. Unlike H&M or GAP chasing low production costs by
outsourcing its complete production, ZARA produces nearly half its merchandise

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in-house. Rather than utilize its factory’s capacities to maximize their output, the
company leaves some capacity left on purpose. Instead of take the benefits of
economies of scale, the retail giant does manufacturing and distributing in small
batches. Not relying on extern service providers, ZARA manages design,
distributing and logistic operations by itself. It leaves even empty shelves in its
retail shops allows occasional stock-outs and waives the advertising completely. In
short, ZARA’s business model defies the past and current conventional practised
supply chain operations. Even because of that some of Zara's practices concerning
its supply chain activities seem to be questionable. 1.1 Strategic advantages
(Strength) As already mentioned, Zara’s strategy seems first to be a disadvantage
regarding to their competitors. Zara’s most interesting and at the same similar
successful competitor is H&M. Both companies are European based, are leading
fashion retails in the middle-low price segment and have a strong and global
expansion strategy

FINDINGS AND SUGGESTION

FINDINGS:

We provided an interesting read regarding Zara’s main business strategies and the
challenges it faces to sustain its competitiveness and success in the next years.

In conclusion, we found an example of how companies, regardless of industry, do

not always follow strategies that are academically taught. We found out that zara
has a wide product range on street fashion for the fashion street.

Zara is a way a fashion could be described it includes integrated strategies and the
development of departmental at even basic material is of best found quality.

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 LIMITATIONS OF THE STUDY

Zara excels by targeting technology investment at the points in its value chain
where it will have the most significant impact, making sure that every dollar spend
on tech has a payoff

The facilities move about 2.5 million items a week, with no item staying in-house
for more than 72 hours. Ceiling-mounted racks and customized sorting machines
patterned on equipment used by overnight parcel services whisk items from
factories to staging areas for each store. Clothes are ironed in advanced, packed on
hangers, with security and price tags affixed.”

Would you advise WalMart or Target to move in the direction of Zara’s Fast
Fashion approach to manufacturing, distributing, and selling clothing? – Why or
why not? – If so, what specific tactics should they adopt? How disruptive would
this be to their business? Why? – If not, are there parts of the Zara approach they
should learn FROM?

or a small fashion startup founded by four recent CMU grads that sells mass-
customized clothing online.

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Bibliography

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Dutta, D. (2002). “The Speed of Fashion.”
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