ACHIEVED GLOBAL SUCCESS WITH ZERO ADVERTISING BUILT ON SPEED DESIGNED FOR ADDCITION

What is Fast Fashion? A contemporary term used by fashion retailers where designs move from catwalk to current fashion trends FAST COLLECTIONS are thus based on catwalks to designing to manufacturing in annuals spring and autumn CHEAP so that mainstream consumer can wear the current style at a low price

Company Overview Spanish Brand launched in ,000 near carbon copies of Fashion big names designs per year The largest fashion retailer in the world Specialities: lightning fast and locally targeted Parent Company: Inditex, one of the 8 brands 6104 in 80 markets, 1770 Zaras Originally named Zorba ACHIEVED GLOBAL SUCCESS WITH ZERO ADVERTISING BUILT ON SPEED DESIGNED FOR ADDCITION

Main Business Woman: Formal and serious TRF: Trendy for young fashion girls Man Kids Mini

Vertically Integrated Business Model A company tends toward forward vertical integration when it controls distribution centers and retailers where its products are sold. Garments enter retail shop within 3 weeks of design where the norm is 6 months new clothes arrive twice a week which means Zara has 104 seasons annually global distribution centre owns 2.5million items a week, nth in the house remains for more than 72 hours strategy of centralized stocks and constant JIT (justintime) restocking, Zara receive goods from more than 300 suppliers from 10 different countries twice a week between hours

Customers: Driving Force and Starting point customer care Store: Meeting point for customers top locations appropriate coordination of garments attention to exterior and interior architectural designs Design/production: Inspiration from global fashion shows proximity of production facilities immediate reaction to trends Logistics: constant renewal offers No central marketing department No indulgence in flashy events No usage of high profile designers Flexible Integrated Business Model Design-->Manufacturing/Sourcing- -> Distribution/Logistics-->Store

Marketing team attends global fashion shows where trends are reiterated to designers Manufacturing and designing lies within the same building allowing easy communication and products launched will be weeks before a luxury brand limited quantity per shop and low stock level promoting exclusivity no repetition of fashion lines to encourage immediate purchase main forms of ads is thru store front displays FAST FASHION: speed at which new designs move from catwalk to consumer to capture current fashion trends Zara is more concerned with finding the exact retail site that best suits the company rather than spending the extra money on luring customers into the store Why is Zara so successful?

ZARA in 中国 When it just opened in China, there was a saying “Zara just murdered everything around it” Aim in china: To maintain standards of quality and immediacy required by the shops Chinese shop for styles and popular brands Growing middle class contributing to this trend Price is along the $25-$75 range Chinese trust foreign brands due to established heritage, no cutting of corners, market status etc Understanding the importance of e-commerce in China but not lowering the exclusivity of their products, Zara offers online shopping but self collection at the shop itself, exclusive for you only

Segment Marketing GEOGRAPHIC: Cities in China Shanghai-14 Beijing-10 Hongkong-9 Shenzhen-4 Shenyang-4 Reason: Higher purchasing power in these cities and larger exposure to global fashion

PSYCHOGRAPHIC: Lifestyle and Personality Greater spending power of middle class Shopping and spending culture of richer Chinese Look towards Western culture, fashion etc.

BEHAVIORAL: User status, loyalty status showing off wearing expensive, higher class products attracted to NEW-ness of Zara products, shelf is replaced twice a week, attracting customers to keep going back

Competitors Forever 21 H&M Mango Asos Topshop Ted Baker Warehouse Miss Selfridge

H&MZARAUniqlo SwedishSpanishJapan Objectives Fashion & quality at low price Fast, affordable, repackaged fashion Uniqlo provides casual clothing for all kind of people. Marketing Strategies Designers’/Artistes collections Zero Advertising Increase customer equity Online Flagship store & High Technology No. of stores Market Share in Asia 9.67%18%81% Revenue $15.1 billion$16.6 billion$10.5 billion

H&M tried imitating but still less responsive to fashion fads as it sources suppliers from Asia to lower cost while Zara sources suppliers closer to its main European markets. Zara’s strong market power signs a year lease allowing it to have a better bargaining power as compared to other competitors in China only 0.3% sales spent on ads while competitors spend 3.5%

Stake in Social Media

SWOT STRENGTHSWEAKNESSES OPPORTUNITIE S THREATS established brandwestern centric designsECB lowered interest ratespanish economic slump logistical vertical integration 1 distribution centre in 1 location emerging Chinese middle class expensive Europe manufacturing base market power to determine store locations outdated POS systemforeign brand adorationsaturation of retailers high inventory turnoverchina factories sourcing centralized distribution systems cost leadership

Major Problems Growth in China is soaking up factory capacity in Spain Dear air-freight transportation costs Difficult balance between tight lead times and production speed to match up with demand

Fast Fashion Opportunities IN CHINA Growing urban disposable income Decentralizing and cascading of development Low fast fashion penetration rate Abundance supply of gross floor area

What’s Next? Replicate model in China? to make use of extensive train transport system and set up design base, incorporating Chinese influence Expansion of retail stores in other major cities