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Zara Case Study

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by

Maxwell Nelson

on 15 February 2011

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Transcript of Zara Case Study

ZA RA History .............................................................. 1975 – Opening of the
first Zara Store 1976 – Purchase of
first computer 1989 – International
expansion begins 1990 – Opening of fully
automated central
warehouse with JIT system 1996 – Expansion of
more central warehouse
to cope with the with
the increase in the number of
points of sale Merchandising Zara’s product merchandising policies emphasized broad, rapidly changing product lines, relatively high fashion content, and reasonable but not excessive physical quality: “clothes to be worn 10 times,”
Key International Competitors Distribution Returns to the distribution center were either shipped to and sold at other Zara stores or disposed of through a small, separate chain of close-out stores near the distribution center.
Advertising Store Operations Zara spent only 0.3% of its revenues on media advertising, compared with 3%-4% for most specialty retailers.
We invest in prime locations. We place great care in the presentation of our storefronts. That is how we project out image. We want out clients to enter a beautiful store, where they are offered the latest fashions. But most important, we want our customers to understand that if they like something, they must buy it now, because it won’t be in the shops the following week. It is all about creating a climate of scarcity and opportunity.
Case Overview
The distribution and advertising format which they
have in place presently is a good model to follow
for the following reasons. The lack of advertising
will not affect the demand for the product In fact this will benefit Zara by not time stamping
their clothing lines and thus they will be able to
distribute what does not sell in one region to a
different region without many consumers being
the wiser and the chance of the price staying high
for that much more maximization of profit. This distribution plan is due to the frontline store
management and the way they can test market the
clothing within it’s own company which in turn
which allows management and stores to succeed. Marketing 594BrandingZara Group 6
Nax Nelson / Greg Proffitt / Alex Schneider / Robert Cherry / Michael Mayall
Full transcript