Essay on The Fashion Industry Zara
Zara created a global brand based on the consumer concept of fast-fashion. In a good year, Zara sold close to 10,000 new items which is about three times of its rivals (Capell, 2008). From its creation to the time it reaches the stores followed by advertising, consumers are well informed and are able to get new products.
Zara makes use of point-of-sale that send details to its headquarters in Spain, displaying real-time information for consumers (Delagarde, and Baykal, 2011). Up-to-date information regard the consumers are left to the local managers of the company for them to be able to get new garments. Information moves from the local company to global stores as the digital assistant use it daily. They are able to acquire new designs and order new materials. This local influence assists Zara regarding consumer’s details to act locally and be up to date with local cultural variation.
Zara’s marketing and advertising techniques to consumers are outstanding. The company uses about 0.3% of promotional products to the consumers. Additionally, the retailer uses location methods, looking for hot spots in malls with many customers (Thomas, 2006). Accordingly, traffic is created through mall location while store traffic is managed through merchandize presentation. Promotion is hence acquired through spread by mouth.
Zara’s globalization efficiency can be described using competitive ability and transaction-based ability. Using a vertically combined company, Zara managed all the levels of this clothing line in terms of distribution and sales. The consumers have been able to acquire the latest trend with the help of new technology and information (Ferdows, Lewis, & Machuca, 2003). The variation from one company to another enables consumers to choose the best and most effective store that meets their needs. The internal production by Zara is unique and is based on consumer preference. Additionally, the company has transaction-based benefits from a central factory that produces most of the products (Kroenke, 2012). The structure of the company is structured in a way that appeals to consumers through backward and forward integration. The brand is popular among its customers for its fast and cost-effective reputation. For instance, it has enabled women in the European market to acquire a great perception of Zara brand.
All of the benefits as stated by Dunning and Barney are met. This is attributed to the company’s rigid O-specific, it has globalized as a leader (Ferdows, Lewis, & Machuca, 2003). The role played by the consumers and management by Zara allows the company to offer resource-based successes that are hard to acquire. The high-control method of globalization makes it possible for Zara to safeguard its resources.
The theory states that Zara would localize itself in the country then go global in France then other nations. In Mexico, Zara had a culture with similar language and religion while the consumers looked for better ways to acquire fashions of developing nations.
Zara’s movement from localized marketing of this cloth lines to global markets was gradual but short period. In the 1990’s the company had opened store in other markets like Greece and Sweden. The consumers were receptive and it grew to other European nations and America (Brookes, and Smith, 2007). Zara’s strategy connects the psychic model and paradox model. Studies show that as companies acquire knowledge in the global markets, growth will shift to distant markets but gradually. Zara on the other hand has been in a position to quicken the process and acquired the US and South Korea markets. The main aspect to this being consumer information acquired and sharing model applied at the store level in all of the countries.
Conclusions and Implication
This paper is based on theories of globalization and the issues arising from global retailers and consumers. Zara’s techniques of globalization attributes have been shown in a dynamic manner. With regard to this, a number of conclusions can be acquired from the globalization theories. Zara is a special company in that it is dedicated to foreign expansion from an early process as it grew. Hence it applied its globalization strategy in a dynamic manner like born-global and not gradual global company.