Reflection
The overall feedback on the presentation was positive with some aspects highlighted that could have been discussed in more detail with appropriate attention. Among different comments made for the study, it was mentioned that the some of the work was done was though related to the business; however, it was less relevant to the course assignment. The aspects that were considered irrelevant to the assignment were sustainability and the sweatshop.
As far, I have managed to understand these aspects are of much significance in the business. Businesses in the modern world are winning a competitive edge over the competitors with evolving business operations in a sustainable way. This does not only add to the financial returns but also the adds the satisfied customer to the company’s portfolio (Hubbard, 2009). The company itself has endorsed its objective to the increased profitability regarding financial returns. Sustainability is an integral part of the environment. It has now become crucial to the success of the business.
The Sweat Shop matter was also referred in connection. In addition to the environment, the sustainability perspective of business now needs to have an equal attention to the all the stakeholders and labors being one of them. For example, ZARA and other brands contributed to Rana Plaza victim (a factory that fell in Bangladesh and unveiled the curtain from the unsafe working conditions of business). However, it is a matter of financial as well as ethical concern for the business to be involved in such activities.
Hence, with this role of sustainability in business and keeping the comments in mind, I have managed to understand that we could have explicitly and more comprehensively commented on the impact these factors have produced on the business performance of ZARA. Both these factor are critical and integral part of the stakeholders that directly and indirectly contribute to the business.
Business Orientation
The marketing and business management of the business are driven by the philosophies of either being market orientation or sales orientation. The former one, which is also applicable on ZARA, refers to the philosophy where business is driven by identifying the customer needs and wants and focusing all business processes and efforts to satisfy those needs and wants in a distinguished way. The latter one, which is also less applicable in the modern world with more aware customers and consumers, refers that sales increase with the increase in the sales related techniques (Lamb, Hair, and McDaniel, 2011).
The success that ZARA has reaped is a sheer reflection and the evidence of market orientation (Mazaira, Gonzalez, and Avendaño, 2003). Among a large number of fashion clothing providers, ZARA has created its entire business model around the customer. For example, the shelf life of the designs in the ZARA is much lesser as compared to other competitors. The business model of ZARA is an interconnected market-oriented where customer feedback from the store is quickly passed on the designers at the designers’ desk. The designing and manufacturing departments are in close coordination for maintaining focus on the customers’ preferences and their likes and dislikes. Though ZARA has also outsourced some of the activities as the trend prevails in the industry; however, the in-depth assessment revealed that market orientated ZARA has outsourced only the labor intensive activities and has kept value adding activities in the house (Crofton and Dopico, 2012). Furthermore, for a better understanding of the customers’ wants and needs, the fashion designing team at ZARA constitutes more of the university graduates. The designers are then able to come up with the designs based on changing preferences because they are close connection to the target audience. Moreover, for the increased focus on the market and its needs, the ZARA operations are highly vertically integrated where most of the clothes are produced in house.
Though ZARA is successful with its current market orientation, however, the evolution in business orientation has much more to offer. The next step to success in business orientation is societal orientation where businesses are required to consider the entire stakeholders including the environment and society in its pursuit of success (Lamb, Hair, and McDaniel, 2011). The flexible in-house business model of ZARA already allows it to adapt operations considerably, and ZARA has also taken measures towards sustainability. Ginsberg and Bloom, (2004) in a research revealed that the customers in the modern world are more inclined towards the products that are environment friendly. Hence, societal marketing orientation can be a source of much more enhanced competitive advantage for the company.
Formulate Appropriate Marketing Mix for Its Product
The products prices, price, place, and promotion are four elements of marketing mix. At ZARA the four aspects of the marketing mix are uniquely presented as compared to the competitors. Being in the fast fashion industry, ZARA consistently shelves new product designs in every 15 days that best fits the changing customer’ preferences with the trends (Tania, 2015). For the price factors, the company offers competitive prices with strong control over the operational cost. As for the place factors, though ZARA is Spain-based company, it has outlets in different parts of the world. ZARA has multichannel for sales including its outlet, other retailers, and e-commerce website. For promotion, unlike other competitive brands, ZARA do not spend much on the advertising (Fibre2Fashion, 2016).
Though the current model is paying off significantly; however, it is important that continuous innovation that has brought success to ZARA continues with the same pace. The company’s focus remained on the bricks and mortar store with limited attention to the online market. In the era of online business, it is recommended that ZARA puts more emphasis on online business (Reuters, 2016). Market like India and middles east are growing high fashion orientation as well as online purchase trend is rising. Furthermore, in markets like India where ZARA has achieved success regarding sales, it is recommended that ZARA introduces the element of local fashion to capture wider share in the market. The strategy will also play an effective role in dealing with the rising competitive pressures in the markets (Malviya, 2015).
It is important to mention that the success that the business model for ZARA has achieved in the global fast fashion industry is not only due to the strict control of the supply chain, but is also a result of the quickly adapting to the changing fashion trends. Hence, with expansion in the global market, business needs to increase its alignment with the local fashions as well for maintaining its strong connection with customer preferences.
List of References
Hubbard, G., (2009). Measuring organizational performance: beyond the triple bottom line. Business Strategy and the Environment, vol.18, no.3, pp. 177-191.
Mazaira, A., Gonzalez, E. and Avendaño, R., (2003). The role of market orientation on company performance through the development of sustainable competitive advantage: the Inditex-Zara case. Marketing Intelligence & Planning, vol.21, no.4, pp. 220-229.
Crofton, S.O. and Dopico, L.G., (2012). Zara-Inditex and the growth of fast fashion. Essays in Economic & Business History, vol.25.
Tania. (2015). Zara’s Unique Supply Chain Management. Social Media For Business. Available from https://smbp.uwaterloo.ca/2015/10/zaras-unique-supply-chain-management/ [Accessed 13 March 2016]
Fibre2Fashion. (2016). Philosophies- No Advertising Strategy. Available from http://fashiongear.fibre2fashion.com/brand-story/zara/advertisements.asp [Accessed 13 March 2016]
Reuters. (2016). Zara Looks to Online Growth as It Cuts Store Sales Forecast. Fortune. Available from http://fortune.com/2016/03/09/zara-stores-online-sales-forecast/ [Accessed 13 March 2016]
Malviya, S. (2015). Zara becomes the first apparel brand in India to cross $100-million sales mark. The Economic Times India. Available from http://articles.economictimes.indiatimes.com/2015-07-10/news/64282723_1_inditex-trent-zara-brand-owner [Accessed 13 March 2016]
Ginsberg, J.M. and Bloom, P.N. (2004). Choosing the right green-marketing strategy. MIT Sloan Management Review, vol.46, no.1, p.79.
Lamb, C., Hair, J. and McDaniel, C., (2011). Essentials of marketing. Cengage Learning.
