Analysis of Zara’s Marketing Plan and Strategy

Analysis of Zara’s Marketing Plan and Strategy: the 4Ps

 

Declaration

I declare that this research is my original work.  This project research paper is produced for the fulfillment of the degree requirement of the …. (University Name). By. It is not written for other purposes.

 


Abstract

The fashion industry is characterized by rapid change in the tastes and preferences of the customers. Moreover, there is great competition in the field since most entrants deal with similar products. Therefore, there is need for actors in the fashion industry to streamline their activities and always ensure their products and services satisfy the clients (Thanisorn and Byaporn). Zara, a Spanish clothes and shoe manufacturer, with a chain of stores is one of the biggest clothes retailers in the world.  In order to overcome the numerous challenges posed by the rapid changes, Zara has adopted various marketing strategies. One of the major strategies is the marketing mix which is also known as the 4Ps which include promotion, product, and price and place (Pailin and Paul). Zara ensures its stores are located in strategic places, the prices are affordable, and conducts some promotions to attract more customers (“Special offers to boost salon coffers,” 2008). Additionally Zara conducts frequent surveys to assess the customer’s need and enhance the development of products to ensure they meet the customers’ needs and preference (“Spanish practices,” 2002). To test how effectively Zara has utilized the 4Ps, data was collected using semi-structured surveys and questionnaires given to store managers. The data will be analyzed using both qualitative and quantitative approaches in order to identify the best practice amongst the four marketing tactics in the 4P model (Carruthers, 2003, Apr 03).

Table of Contents

Abstract 2

Chapter 1 : Introduction. 5

1.1 Rationale. 5

1.2. Research Background. 6

1.3. Scope, Aims and objectives. 7

1.4. Research Questions. 7

Chapter 2 : Literature review.. 8

2.1.  Marketing Mix Strategy. 9

2.2.  Relationship between Marketing Mix and Brand Equity. 10

2.3. The 4Ps Model and Brand Equity. 11

2.3.1. Price. 11

2.3.2. Place. 12

2.3.33. Product 13

2.3.4. Promotion. 13

Chapter 3 :Methodology. 13

3.1. Introduction. 13

3.2. Research Methods and Strategy. 14

3.3. Validity and Reliability of the Research. 15

3.4. Sample Type and Sample Size. 15

3.5. Data Collection. 15

3.6. Conceptual Design. 16

3.7. Research Approaches and Research Designs. 16

3.7.1. Instrumentation. 16

3.7.2. Qualitative Method: Self-administered Questionnaire. 17

3.7.3. Qualitative Method: Semi-structure Interviews. 18

3.8. Actual Data Collection. 19

3.8.1. The Survey Questionnaires. 19

3.8.2. The Semi-Structured Interviews. 20

3.9. Evaluation of Research Methodology. 20

3.9.1. Data Reliability. 20

3.9.2. Validity. 21

3.9.3. Generalizability. 21

3.10. Ethical Considerations. 21

Chapter 4 : Findings and Analysis. 22

4.1. Brief Description of Data Collection, Respondents and Proposed plan of Data Analysis. 22

4.2. Quantitative  Method: Self-Administered Questionnaire. 22

4.3. Qualitative Data: Semi-structure Interviews. 25

4.4. Comparison of Reality (From the Research) Versus Literature. 28

Chapter 5 :Conclusions and recommendations. 28

5.1. Research Gaps, Limitations and implications  of this Research. 30

References. 31

Appendices. 38

Appendix 1: Questionnaire Questions. 38

Appendix 2: Interview questions. 39

 

 


Chapter 1 : Introduction

1.1 Rationale

The fashion industry is characterized by rapid change in the tastes and preferences of the customers. Zara is a clothes and shoes retailing company, with a chain of stores located across the globe. Zara focuses on meeting its mission which entails moving at the pace of the society. This requires the company to be innovative to ensure its fashion ideas and trend meets the rapidly changing needs of customers in the fashion industry (Arrigo, 2010). This has led to Zara having brands with strong customer identity. The major strength of Zara is its ability to adapt to changes and its dedication to build a brand that has managed to grow in the saturated fashion industry (Li, Yao, & Yeung, 2003; Tungate, 2012). Zara uses branding strategies which include company branding through the range of products it makes and attitude branding which relates to the feeling associated with using Zara products. According to Willems et al (2012), increased globalization has resulted in increased competition since it leads to presence of numerous companies targeting for the same niche markets (Bhadwaj and Fairhust, 2010). One of the most competitive industries is the fashion industry which is characterized by rapid changes (Lorenzo, 2005). This requires the fashion retailers to adopt appropriate marketing and chain supply systems to ensure the customers identify with their products (Haque, & Rahman, 2009).  This has made Zara products to be iconic brands that people easily identify with (Raffaelli, 2011; Goi, 2009).  Another important aspect is setting the appropriate price which is greatly associates to the strong brand name (Haque & Rahman, 2009). Although their products are not significantly different from others in the market, the use of brand extension to include both clothes and shoes for children, men, women, and teens has strengthened their brand and increased the target market (Lopez & Fan, 2009; Stern, 2007). According to Dogra (2007) the price should be determined by the cost of production, the purchasing power of the customers and spending habits. Another important marketing factor is promotion. Promotion encourages customers to purchase from a certain retailer and not another (Smith, 2003; Vivancos, 2009; Hudson & Rynne, 1999). However, companies with a strong brand name do not require focusing much on promotion to prevent occurrences such as brand dilution (Fashion and Branding,” 2008).

1.2. Research Background

Robust marketing strategies are required to enable accompany deal with al the market variables (Kotler, Armstrong and Wong, 1996). The fashion Industry is dominant and has a specific culture. In order to get a popular clothing label, accompany must apply appropriate branding strategy which is inclusive of marketing approach (Iltis, 2010). Branding is among the most important components of business. Applying appropriate brand strategy enables companies to compete effectively. This makes customers believe in a company’s products since it differentiates them from those of their competitors. Zara’s brand name is greatly associated to company philosophy and mission (Tungate, 2012). Zara is one of the most successful fashion retailers in the world, which has a strong brand name. The Spanish company, which is currently owned by INDITEX, was started by Rosalia Mera and Amancio Ortega in 1975 (Hemantha, 2012; “Zara posts 48pc jump in op profits,” 2009, Apr 28). The first store was opened in Arteixo and two other stores were later opened in Madrid and Zaragora. In1985, the company opened a store in Portugal. This marked the first step in globalization of Zara. In 1985, Jose Maria Castillian joined the company and became the CEO (“Amancio Ortega,” 2012). Currently, company has expanded rapidly to include a chain of over 1412 store in over 69 countries. The stores are located in Africa, Asia Europe and America with majority of the stores being in Spain (Mintel, 2009; “Zara makes african debut,” 2011). The company deals with manufacture and sale of men, kids, teens and female products. In 2007, Zara made a strategic move by beginning to market and sell its products online. This project research will focus on the marketing plan and strategies that Zara has utilized to develop their unique brand image and reputation across the globe (Kenna, 2011).  The analysis will provide insights on how Zara has managed to control and attain a stable market, which enables it, compete effectively with the numerous competitors in clothes and fashion industry.

According to Jiale (2012), price is an important factor that customers consider while deciding whether to purchase a product. Moreover, the price is a measure of a company or product’s brand (Li, Yao, & Yeung, 2003). Zara ensures that their pricing system is market and brand oriented. This entails analyzing the spending habits, which vary across the globe, company image, and setting prices accordingly. This kind of pricing is commonly referred as [psychological pricing. Zara stores are well located in places where existing and prospective customers can view and access them.

Customers in the fashion and clothes industry are always looking for the most fashionable apparel, footwear and accessories in a high end or elegance place (Dogra, 2007). Zara operate a fast-fashion philosophy that given consumers to have the trendiest products. Therefore, Zara product image is based on trendiness. Promotion is another strategy used by Zara to market its products (Hamel, 1996). Zara avoids excessive use of promotion to avoid diluting the established brand image. Besides, Zara concerned about the consumer behavior. Consumer behavior is a key resource for a company especially in fashion industry. Zara always have the trendiest apparel to attract their customers to come to them regularly. Hence, Zara always faced a lot of factors that come from customer but they can overcome it well (Lee, 2008).

The company’s brand is crucial and indicative of company marketing strategy since it tells the customers the expectations they should have on the products (Haque, & Rahman, 2009). It differentiates the product offered by a company from those offered by other competitor companies. Moreover, product is linked to the 4Ps marketing strategy. It links to place since it is based on the reliability of a product, the price which is based on the quality, and the availability of the product (Tungate, 2012). The brand dictates if accompany requires to engage in promotion or not. Therefore, brand strategy can be defined as what, when, where and whom you are planning to communicate to depending on the brand you produce (Iltis, 2010). The place where you locate your stores and your distribution channels is part of brand strategy.  What you communicate through promotion, price, place where you are found, and quality dictates your brand image (Li, Yao, & Yeung, 2003). Moreover, public relations is very important inenabling company develop its brand (Greenberg, 2005).

1.3. Scope, Aims and objectives

The aim of the research is to identify the ability of Zara to function in the internationalized markets and how well Zara has been performing since its establishment and how its brand image has grown. Existing literature has demonstrated that Zara has been competing effectively in the fashion industry. Through this research it will be possible to see why Zara has managed to compete effectively and remain relevant irrespective of having started as a small company.

1.4. Research Questions

This research aims at examining how effectively Zara utilizes the 4Ps in its manufacturing and marketing plan. Since Zara has a large number of stores spread across the globe, the study will be conducted at a store level. The research aims at answering the following questions:

  • How Zara using the 4Ps (price, place, promotion and product) well to compete with their key competitors?
  • How does Zara overcome the consumer behavior problem and make them always come to Zara?
  • Why Zara develop their company so fast to a top company in this few decades?
  • What is the Zara philosophy make them become so successful?

Chapter 2 : Literature review

Marketing mix is one of the most popular strategies that have been used by companies in improving their efficiency. Moreover, the element of marketing mix play a crucial role in helping company build brand image, which refers to the incremental utility of a given product  due to increased preference for its brand (Brioschi, 2005; Iltis, 2010). McDonald (2007) argues that the marketing mix, which is known as the 4Ps (Product, Price, Place, and Promotion), is one of the most significant concept in the field of marketing (Iltis, 2010). Moreover, Greenberg (2005) asserts that companies should apply the 4Ps differently depending on their sizes. One of the major factors that have contributed to Zara’s success is their dedication to make quality and trendy clothing for their customers (Rowley, 2009). Moreover, the company manufactures footwear and other accessories for men women and children (Ghemawat and Nueno, 2003; “BRAND THERAPY” 2006).

Kumar (2010) argues that using the marketing mix entails combining various methods while doing business to achieve marketing objectives. Harper (2012) adds that the marketing mix entails utilizing a number of controllable variables to influence the target market and enhance the overall marketing outcome (Li, Yao, & Yeung, 2003). Identifying and meeting the needs of the customer are one of the major factors that enables companies compete effectively (Cheng, Hines, and Grime, 2008; Nakhchian, Boorani, & Gorji, 2012). Zara conducts frequent surveys that are aimed at tracking the preferences of their customers throughout the year. This is importance since Zara has customers across the globe and preferences vary greatly (Hemantha, 2012).

Zara has entered into the digital world through online marketing. Zara’s online shops features various aspects such as the products offered, their price and delivery procedures (Mazaira, Gonzalez, and Avendaño, 2003).

In relation to product, Zara has a unique approach that focuses on quality product development. Zara is characterized by significant autonomy which ensures that their designs are not copied. The company gathers information about the changing market trends and uses the information collected to develop products that meet the customers’ taste and preferences (Hemantha, 2012). Moreover, Zara has a team of commercials who are located in La Coruña which is Zara’s headquarters. This team is involved in receiving all the information from their stores worldwide and making plans on how to design Zara’s products. The ability to collect and relay information in a short period enables Zara employees design, manufacture and distribute a product in a period of 3-4 weeks making the company one of the most reliable clothes and shoe manufacturer (Tungate, 2012). Moreover, this strategy helps Zara maintain its autonomy enabling it compete effectively with its competitors without fear of its designs being copied (Håkan, & Waluszewski, 2005).

2.1. Marketing Mix Strategy

Zineldin and Philipson (2003), the marketing mix is a set of selling tools that enable companies to reach their target customers in the market. Marketing mix is crucial in developing a good brand. When dealing with fashion, companies operating within Europe are often forced to rebrand while introducing their products to the Middle East (Cooper & Momani, 2009).  Tungate (2012) identifies the 4Ps model as the most popular marketing strategy which encompasses four factors which include product, promotion, price, and place (Tungate, 2012). The product encompasses various elements such as quality, variety, characteristics, brand name, return, size, design and packaging (Smith, 2003). These factors determine the demand for a product.  Price encompasses various aspects which include list price, allowance, credit time, payment mode, discount and the period required form the payment to be made (Chevalier, Mazzalovo, 2008). Promotion encompasses various dimensions such as use of advertisement, sales force, relationship between company and public, and how well the company performs sales promotion. Place is defined by various dimensions which include locality, transport, coverage of the area, assortments, and reachability of the place (Ashworth et al., 2006; Carter, 2004).

2.2. Relationship between Marketing Mix and Brand Equity

The concept of brand equity was introduced into the marketing field in the1980’s and immediately attracted great attention from marketing researchers. Most research depicts that the marketing mix elements have great effect on the brand equity (Brioschi, 2005). Brand equity refers to the difference between the consumers’ choice between branded and unbranded product and service. Brand image plays a major role in enabling accompanies market its product or service (Jiale, 2012). Moreover, the brand image impacts on the buyer’s intention and a good brand image can make customers choose to buy a product they had not intended to buy (Willems et al., 2012). The marketing mix strategy is also a crucial aspect that impacts on customer behavior and can help a company build customer loyalty, which is an important facet in enabling a company to compete in the highly competitive global market.  The brand image is mainly determined by the elements of a product such as its quality, size, availability, and affordability (Brioschi, 2005). Moreover, the location of a store is crucial in formation of brand image. Fashion products found in luxurious locations are often considered to be of good brand. Moreover, when stores are in popular streets, they strengthen brand image since customers are likely to recall them easily (Haque, & Rahman, 2009).

According to Usui (2011), there is still need for adequate research on the co-relation between brand equity and the marketing mix or the 4Ps model. However, the researchers acknowledge that use of brand equity enables companies to rise above their competitors. This is because customers tend to be very interested in comparing the quality of a given product (Tungate, 2012). If the customers find a certain product more appealing, they are more likely to become frequent users of the product and even inform their friends and family (Friedman, 2004; Usui, 2011). This enables a company’s product become popular and a company has high customer retaining ability (“Oracle retail week awards,” 2013; Pepper, 2005).

2.3. The 4Ps Model and Brand Equity

As aforementioned, the 4Ps of the marketing mix represent price, product, place and promotion. This section will review each of the elements using the existing literature.

2.3.1. Price

Price is an important factor that customer’s consider when deciding the product to buy. Moreover, the price of a product is greatly influenced by the brand equity. This is because prices tends to be directly related to the perceive quality of a given product. Therefore, high quality products, which have a good brand equity tend to be more expensive (Jiale, 2012; “From prada to Zara,” 2009). Moreover, the price of such quality products tends to be affected less by factors such as competition from cheaper brands (Fashion and Branding,” 2008). Zara considers brand equity to be a very important aspect and focuses on enhancing the quality of its products which results in high brand equity (Lopez & Fan, 2009).  Moreover, high prices make people to have a positive image towards a product. There are various ways a company can strengthen its brand image. Use of advertisement help the public identify the uniqueness or improvements made on a product. This reduces the notion of product heterogeneity leading to increased knowledge on a product and better brand image (Creswell, 2003; Crawford, 2001; “Respect your universe, Inc.,” 2014). Zara mainly advertises its products on popular fashion magazines, which has greatly influenced the brand image such that people are willing to buy Zara’s products irrespective of their being highly priced (Jiale, 2012). Moreover, Zara’s high price on the products is often viewed as an indicator of quality. Therefore, when Zara creates a new design and sells it at a higher price, people still buy the product since they associate the high price with good quality leading continues growth of brand image (Mazaira Gonzales, Avedano, 2003).

As a marketing strategy, Zara offers varying rage of brands for various buyers depending on their purchasing power. Therefore, the price differs across the globe depending on factors such as the spending culture and the income levels (Cheng, Hines, and Grime, 2008).

2.3.2. Place

In addition to having store spread across the globe, most of Zara stores are located in malls and premium shopping centers. From the initial stages, Zara focused in buying stores located in storefront in luxurious places.  This led the company to be labeled as of ‘affordable luxury’ since the locations are in places that increase customer awareness. A place acts as the point where the elements of supply and demand connect (Marciniak and Bruce, 2004; Ritson, 2003). Place is the marketing mix element that enables a company establish and handle the distribution channel. Moreover, place enables the producer to bring the product closer to the potential customers (Jiale, 2012). Therefore, it is the element that links the supply with demand and enables the producer to make their commodity available and reachable to the consumers (Bertoldi et al., 2013).  It is thus an important element of marketing and enables the company establish a smooth channel through which a product moves from the production to the consumption. Moreover, place creates a connection between all the other marketing mix elements (Dogra, 2007). It provides an avenue for promotions to be done and helps in movement of the product from producer to consumer (Pepper, 2005). Since the channel used to move the product from producer to consumer involves some cost, the location of the place is crucial and determines the price. For example, a global company like Zara, with stores across the globe incurs some costs while moving its products from their manufacturing plant to other regions. In relation to Zara, the company deals with branded products and thus brand equity is an important concept that plays a crucial role in determining the performance of Zara products (Cooper, 2009).

2.3.33. Product

Zara mainly offers a wide range of clothes and shoes for women, men, children and teenagers.  According to Tungate (2012), Zara’s products are customer focused and are characterized by unique brand. Moreover, the products are trendy, fashionable and unique. This is because Zara manages to create new designs faster than its competitors (Carruthers, 2003, Apr 03). Therefore, most of the products in Zara stores are freshly designed. Moreover, fresh inventory is a major marketing strategy for Zara. Zara stocks its stores with new designs two times in a week. This depicts the rapidity in designing of new products (Jiale, 2012).

2.3.4. Promotion

Although Zara rarely offers promotion on its products, powerful word of mouth plays a major role in supporting Zara (Willems et al., 2012). Moreover, the highly visible stores exhibit products that are fashion appellative. Moreover, Zara ensures its products are in block by combining matching products. This ensures that customers spend more money shopping in Zara where they can get a combination of products instead of shopping in stores owned by Zara’s competitors.  Therefore, the company is able to encourage their customers to visit the store for shopping again and again (Jiale, 2012; Silk, 2006).

Chapter 3 : Methodology

3.1. Introduction

This research aims at investigating the implementation and utilization of the 4Ps marketing strategy by Zara, a shoe and clothes manufacturer. The main source of data and information will be the existing literature on marketing mix and on Zara. The information will be obtained from journal articles, magazines, books and internet. Additionally, the information obtained quantitatively through review of literature will be supported with data obtained quantitatively (Tungate, 2012).  The research will use both positivism and interpretivism approaches. Humans cannot respond to certain aspects in prescribed manner and such reactions cannot be explained using figures but only through qualitative analysis. However, some aspects can be quantifies and positivism is applicable. Positivist approach involves both experimental and descriptive research (Hussey & Collis, 2009; (Evans & Hardy, 2010). The quantitative research will help explain the existing information by demonstrating the change in Zara’s marketing trend over time and how utilizing the marketing mix has altered Zara’s performance (Jiale, 2012). Moreover, the research will show how Zara competes with its key competitors and why it has managed to outperform most of its competitors to become one of the best performing clothes and shoe retailer in the world. This project will use self-administered questionnaires and semi-structure interview as a tool to gather all the data. The above data collection strategies are preferable since they are easy to administer, quicker to manage and eliminate the interviewer’s effect hence reducing possible biasness. The question will focus on in Zara and its competitors about the marketing skill have been used. Where normally we can find Zara? Are Zara’s prices are reasonable? Is Zara product met the trend or fashion? Is Zara always having promotion? These are the question that will show in the questionnaire to ask for the people. The results obtained from this study will be compared to existing literature on the marketing mix.

3.2. Research Methods and Strategy

There are two types of research methodologies which include qualitative approach and quantitative approach. The qualitative methodology helps in obtaining in-depth information regarding the research question. This approach enables the researcher utilize personal values and belief while analyzing data. This leads to in-depth understanding of data. This approach will be used especially when dealing with the semi-structured interviews as well as when relating the research findings with existing literature on the marketing mix.

On the other hand, quantitative approach entails analyze of figures and numbers. This approach enables generalization of a study and deals with issues from a broader perspective (EuropeCotten, 1999).   In this research we will use both qualitative and quantitative research. The quantitative approach will help analyze figure obtained while qualitative approach will help in describing the data in relation to existing literature.

3.3. Validity and Reliability of the Research

 Data reliability and validity are two important concepts that help the researcher deal with research issues such as errors which may occur in the process of data collection and analysis leading to reduction in the quality of a research. To ensure that the collected data was free from errors and capable of producing consistent and authentic results, various aspects were considered.

3.4. Sample Type, Sampling Method and Sample Size

For appropriate sampling, the sampling method should be focus on ensuring that the research objectives are met. This research focuses on brand equity and its influence on Zara marketing plan (Evans & Hardy, 2010). Therefore systematic sampling is the most appropriate method since it allows selection of targeted section of the whole population. This sampling method is almost similar to random selection but it is simpler (Hussey & Collis, 2009). The most appropriate section of Zara is the employees with supervisory roles since they are the implementers of Zara 4P marketing Plan. The sample was selected from various stores. The survey included employees working in the various store and most of the participants in the structured interviews were store managers. The sample comprised of 80 respondents who were selected systematically and recruited with the help of the human resource departments in the various stores. The self-administered questionnaires were sent through the email. The sampling criteria required that all the selected participants had to be computer literate and capable of understanding and writing in English, the language used to administer the research questions. The participants were selected from several stores across Europe where the company is well established (Tungate, 2012). This was possible with the help of human resource departments from the stores I could reach. The employees sampled were either managers, supervisors or assistant managers since they are likely to be the persons with adequate understanding of the company operations.

3.5. Data Collection

To assess the usability of the 4Ps in Zara’s market if plan qualitative research (through literature review) and primary research which involved quantitative research through collection and analysis of existing data.  The primary data used for qualitative analysis was collected through semi-structured interviews while data for quantitative analysis was collected using questionnaires. Before going to the field to collect data documental research was done from existing article, from the internes, particularly on the various websites operated by Zara’s well as on their pages in different social media. Moreover, a pilot project was conducted by offering questionnaires to fellow students to collect data on their views about Zara marketing strategy and Zara branding. Pilot project is important since it helps in enabling the researcher prepare adequately for the actual field study and make changes where necessary. The information from literature review and pilot project was used to establish the effectiveness of the questionnaires to be used in the actual data gathering. Most of the data was collected using questionnaires and interviews were used to approve the questionnaires. To collect data in the field questionnaires as well as interviews were used.

3.6. Conceptual Design

 

The actual questionnaire comprised of questions, which focused on general information concerning Zara Company as well as how the various marketing strategies relate to the 4Ps. The questions concerned how well the 4Ps can help in marketing of products in the increasingly competitive fashion industry (Porter, 1998). Before the actual filling of questionnaire, there was a visit to some Zara stores to obtain the sample with the help of the human resource departments. The email addresses of the participants were obtained since the questionnaires were to be sent online. Using self-administered questionnaire was crucial in eliminating the interviewer’s effect. The questions in the questionnaire were given scales of 1 to 5. The interviews were conducted through phone call. The aim was to avoid possible biasness which arises in one on one interview.

The next stage entailed summing up as well as reviewing the questions answered and the respondents who participated. 7 of the questionnaires were characterized by inadequate information while 3 of the participants did not send back the filled questionnaires. Therefore there were 70 questionnaires to be analyzed.

3.7. Research Approaches and Research Designs

3.7.1. Instrumentation

As aforementioned, this research entails combining both qualitative and quantitative research methodologies. The quantitative methodology takes form of the self-administered questionnaires which will be analyzed statistically to obtained percentages that will demonstrate the effectiveness of the 4Ps model as Zara marketing strategy.  The qualitative method, which takes form of the semi-structured interviews, is aimed as a back up to the quantitative method. Data obtained from the questionnaires will be approved using the interviews. Using both methods is crucial since the research shows the trends in addition to providing insights on the various trends, as will be demonstrated in this research.

3.7.2. Qualitative Method: Self-administered Questionnaire

Saunders et al. (2003) argues that questionnaire is an appropriate and widely used technique in data collection. The appropriateness is based on the fact that all participants respond to the same questions. Therefore, there is greater efficiency since the probability of biased data is reduced. Moreover, questionnaire technique of data collection tends to be direct, can involve a large sample. Moreover, self-administered questionnaires are more appropriate since each respondent is contacted separately. This research makes use of self-administered questionnaires to maximize on the number of responses and ensure that the responses are reliable. The questions used in the questionnaires are provided in Appendix 1. The questions are aimed at finding information on how the various stores make use of the 4Ps in their marketing plan. The first section will help in comparing how the various stores apply the 4Ps model. Moreover, the questions in this section aim at depicting hos the 4Ps have enabled Zara compete effectively with their key competitors in the highly competitive fashion industry.

Another section of the questionnaires aims at obtaining data on Zara overcomes consumer behaviors. The major behavior under analysis is the frequent change in customer tastes can lead to loss of customers. However, the fact that Zara has managed to retain most of the customer makes the data obtained in this section crucial since it will demonstrate how Zara manages to satisfy their customers effectively.

The next set of questions will focus on establishing the factors behind the rapid growth of Zara as a company. Although Zara has been in the fashion industry for a considerably short period, it has become extremely popular. The data from this section will be supported by the findings from Zara surveys.  The last set of questions focus on Zara philosophy which asserts that creativity and quality design in addition to rapid response to the market demands, which are determined by customers’ tastes and preferences, leads to profitable results. This philosophy is implemented by combining prices with ability to produce new styles and distribute them rapidly as compared to their competitors. To ensure that there was maximum response to the questions, there was validity and reliability the questionnaires were carefully designed to ensure the questions sent to all participants were similar. The questions were laid out appropriately and there was lucid explanation on the purposes of the questionnaire and the participants were required to send back their completed questionnaire forms. Moreover, follow up call were made to ensure all the participants had received their questionnaires.

3.7.3. Qualitative Method: Semi-structure Interviews

While using questionnaires, it becomes hard to obtain in-depth information since the questions used in questionnaires require direct answers. Therefore, semi-structured interview is used to enhance and supplement the data obtained using the quantitative approach (EuropeCotten, 1999). To obtain such data, a number of questions were designed. However, the questions were open to ensure that the interviewees could provide additional information which they find necessary or which related to the asked question. The interviews were conducted through the phone to reduce the cost of the study and ensure that the participants from many stores located in different localities participated. However, the same questions are asked to all the participants. This information is important in providing insights on how the data obtained quantitatively can be enhanced. The set of questions used in the interviews are provided in Appendix 2. The questions focus on the marketing strategies used in the various Zara stores. The questions used in the interviews were related to those used in the questionnaires since the interviews were mainly meant to affirm the questionnaire findings.  The data obtained from the various managers was then compared and analyzed. Moreover, the data was used in assessing the reliability of the information provided in the questionnaires.

3.8. Actual Data Collection

3.8.1. The Survey Questionnaires

The data collection entailed various stages. First, there was a visit to the stores where data was going to be collected. During the visit arrangements were made with the help of the human resource manager, such arrangement involved obtaining the research sample. With the help of the human resource departments, the participants who were willing to participate were identified and their email addresses provided. A total of 80 participants we identified. In the next step, the research questions (questionnaires) were emailed to all the participants. Together with the research questions was a note explaining the significance of the research. This was aimed at increasing the number of participants. Moreover, the email address which they were supposed to use to send their filled questionnaires was provided in the note.

After emailing the participants, calls were made to confirm they have received the questionnaires. Moreover, a reminder note was emailed two weeks after to reemphasize on the importance of the research and the need for the participants to undertake the questions. However, the participants were also notified that they were free to quit from the study if they felt like they were not ready to participate. This was to ensure that the rights of the participants were respected by not forcing them to participate in the research.

3.8.2. The Semi-Structured Interviews

After designing the interview questions, the potential respondents were contacted. This involved making phone calls to the various stores and requesting to talk with the store manages. Arrangements for the actual interviews were made. All the interviews were conducted through phone calls and lasted for 25-30 minutes. Moreover, the interviews were recorded, which was in agreement with the interviewees. Moreover, careful notes were made to ensure there was back up data if problems occurred in the recording process or if such records were lost accidentally.

3.9. Evaluation of Research Methodology

To determine if the research methodologies used are appropriate, the concepts can be used. The concepts include the reliability, validity and generalizability of the research (Lorenzo, 2005). . These concepts help in providing the appropriate framework for evaluating in fields such as social sciences, business and in management (Blackmon and Maylor, 2005).

3.9.1. Data Reliability

Litwin and Fink (1995) argue that the reliability is determined by the ability of the data to be reproduced. The measure of how data is reproducible is determined by the accurateness of the research methods and techniques to produce data. In relation to this research, using the mixed researches a measure of how reliable the data obtained is. The use of quantitative method produces measurable data while qualitative approach affirms the quantitative data by providing detailed explanations form the trends observed in quantitative measure. Moreover, the questionnaires were closely checked to ensure they did not have typing errors and the questions were clear. Avoiding ambiguity ensured the respondents provided the appropriate answers.

3.9.2. Validity

According to Eriksson and Kovalainen (2008) validity entails the level of accuracy of the conclusions drawn from a research. This is measured by checking the descriptions and explanations of happenings. To ensure this research was valid, ambiguity in the research questions was avoided to prevent ambiguous responses.

3.9.3. Generalizability

Generalizability involves the extent to which the research finding can be applied in a wider context Blackmon, K. and Maylor, H. (2005). In this research only a total of 80 managers participated due to limitations such as time, reachability of the managers and budget. Since Zara has numerous stores, the number research on in this paper is quite modest. However, it emerged that most of Zara’s store operate in closely related manner. Moreover, use of semi-structured interview enabled acquisition of further knowledge which shed a light on how unique Zara stores in other regions of the world could be from those in Europe.

3.10. Ethical Considerations

Ethical is important to a project and always need to think wisely and consider well. The human ethical is the key to concern when doing this research. It will not offence to any party and will be very rational but not non-rational. The research will seek permission from the selected students or stranger to do for the questionnaire. All the research from the databases is real but not unreliable. The research will be studying to conduct research that involving them. As I said, it will not have any emotional harm to the subject and will using simple as being careful. It will not appear any of the sensitive words in the research or during the interview. The opinion that given and the research will give both sides fair consideration but the only support only the one side. In my interview and questionnaire, I will let those interviewers to know that the research result will be anonymous. It will not take interview response out of context and do not discuss small parts of observation or interview without putting them into the research.

Chapter 4 : Findings and Analysis

4.1. Brief Description of Data Collection, Respondents and Proposed plan of Data Analysis

Of all the sent questionnaires, only 10were discarded for reasons which have already ben explained. The respondents filled and sent back the questions within a period of one month. In the semi-structured interviews, all the participants were reached through the phone and the interviews went on appropriately. The analysis of data will mainly focus on addressing the research questions and aims which have already been identified. To ensure that the analysis is more efficient, data collected from both qualitative and quantitative approaches will be combined in both areas. However the first section will mainly focus on questionnaires which comprised the quantitative method while the second part will be mainly explanation. The explanations will provide more insights on the quantitative data and will be mainly based on the interviews.

4.2. Quantitative Method: Self-Administered Questionnaire

After summing up and analysing the data statistically, the research focused on determining how Zara uses the 4Ps (price, place, promotion and product) well to compete with their key competitors, and how the company overcomes the consumer behavior problem and make them always come to Zara. Additionally, the analysis was aimed at establishing why Zara develop their company so fast to a top company in this few decades and the Zara philosophy that make the company become so successful. There were various questions for each research questions, the responses for the questions were summed up and a mean obtained.

The real situation was assessed through the assumed customer satisfaction which Zara managers obtain from the surveys they conduct with the aim of identifying the customer needs as well as determining if the needs are met. Such feedback comes from Zara customers. The interview surveys have shown that 75% of the feedback obtained from the customer is positive (53/70 of the participants said they had served customers who often frequented the Zara store they worked in. such customers were pleased with the products and felt that the prices accorded to the various products was reasonable and portrayed the quality of the product. 34/70 (48.57%) felt that the high ability to retain customer was due to the promotions offered by Zara especially in terms of discount and lowered prices in places such as stores in African region. However, 58/70 (82.85%) believed that Zara’s promotions were too few and there was need to increase the promotions to attract more customers. Since Zara products are highly priced offering promotions would attract customers who have never tested Zara products. In so doing the new customers will be able to realize that the products are worth their prices. This is evident from the 49/70 (70%) who felt that some people fail to shop at Zara since they have never tested the quality of Zara’s product and thus have the notion that the products are too expensive. From Zara’s own surveys several respondents had claimed they had shopped in Zara only when Zara was offering discounts.

In relation to the location of Zara stores, 62/70 (88.57%) affirmed that they believed the strategic location of the stores had played the major role in enhancing Zara sales. This was confirmed from the interviews where the mangers asserted that the stores were in locations that were accessible, noticeable and thus attracted customers visiting places such as shopping malls.

In relation to Zara philosophy 58/70 (82.86%) believed that the strategy of producing a few pieces and at a time and transporting them fast to the clients had played a major role in enabling Zara succeed. However 22/70 (31%) felt that Zara could make more sales if they produced a little bit more pieces on new designs. This is because a new design creates euphoria and numerous people tend to frequent Zara wanting to get the most recent design. If the pieces are not  enough some of the prospective customers give up and are unwilling to wait for the few days Zara takes to produce additional pieces and send them to their stores.

On questions regarding how Zara overcomes consumer behavior problems enabling the customer retain most of its customer 47/70 (67.14) believed that the efficient and fast channel from production to distribution is the major cause of customer satisfaction. In most cases, people wanting to attend an occasion that had emerged suddenly would come to Zara to have their shoes or clothes designed since they knew they would get them in good time. However, 46/70 (65.71) felt that advertisement was required to enhance Zara sales since the company mainly depended on word of mouth as the main way to advertise its products. The advertisements could involve some form of promotion to be more effective.

In relation to why Zara had developed their company so fast to be a top company in a few decade, there were three questions regarding this issue. From summing up the responses from the three questions regarding this issue, 200 responses were obtained since 10 people failed to respond to some questions. After analyzing the obtained responses 155/200 (77.5) felt that the major contribution is use of appropriate marketing skill. 73/155 (47.1%) attributed the success to the good quality products and the high prices which have created a good image making Zara products have a good brand. 45/155 (29%) attributed the success to quality products and strategic location of the stores which made it easy for customers to shop as frequent as they wanted. 20/155 (12.9%) claimed that the success was attributable to all the elements of the marketing mix with the major contribution being price and quality. Only a small fraction 17/155 (10.9%) attributed the success to promotion. This portrays that Zara has not been using the promotion element adequately.

The last set of questions aimed at establishing the role of Zara’s philosophy in the company’s success. The responses demonstrated that the philosophy guides most of Zara’s operations including their marketing plan and strategies. One question, which was answered by all the participants focused on determining if the Zara philosophy has been implemented appropriately. 59/70 (84.8) believed that Zara philosophy has been the major driving force in Zara’s success. The other 11/70 (15.7) felt that there were other more important factors such as the employees dedication that had led to Zara’s success. In another question seeking to establish if Zara’s philosophy was in line with the company’s marketing strategy, it was evident that the marketing plan is mainly based on the philosophy. 56/70 (80%) felt that Zara has one of the best philosophy which guides most of its operation inclusive of the marketing plan. This demonstrates the crucial role that Zara’s philosophy plays. Moreover, the answers from the interviews showed that philosophy guides the company in aspects such as choosing the location of their stores, developing the supply chain and in the overall service to their clients. The 10/70 (14.3%) felt that the marketing strategy tend to differ somehow from the philosophy. The rest 4/70 (5.71%) said they were not sure.

From the above quantitative analysis, it is evident that Zara has a unique way of operating which has enabled it outperform its competitors. Moreover, Zara makes use of the 4Ps with the aim of offering the best to their customers. Moreover, the crucial role of Zara philosophy has been demonstrated. The strategic position of the stores ensures the produced products are sold within the appropriate time span reading to smo0th chain of flow of products from manufacture to sale.

4.3. Qualitative Data: Semi-structure Interviews

From the findings, it is evident that Zara has been using the 4Ps (price, place, promotion and product) considerably well to compete with their key competitors. However, it has also emerged that Zara needs to focus more on promotion to ensure they reach more customers and make them identify with the high quality products produced by Zara. The data portrayed in the questionnaire responses is parallel to the information obtained through the semi-structured interviews.  The interviews were conducted on 15 store managers through the phone. All the managers were cooperative and willing to share their information. Most of the managers agreed that they rarely offer discounts and when they offer it often on items that fail to be purchased within a certain period of time. Some argued that they did not focus much on promotions since their main focus was on enhancing their quality. Therefore frequent offers and discounts could spoil their brand image and ruin their market since people were likely to think that the products under offer were of lesser quality. Therefore, it is evident that the quality of the products is most utilized marketing strategy by Zara. Moreover, all the store managers who participated in the interviews briefly described the location of their stores. From the description, most of the stores were located near shopping malls within town centers, places where they were highly visible and accessible. From the responses obtained, it was evident that most of the store managers are guided by Zara’s philosophy. They have thus enhanced operations in their stores to ensure that the channel followed from production to sale of their products was efficient.

In relation to how Zara manages to meet the diverse needs of customers in the fashion industry, the managers demonstrated that they dedicate themselves to obtaining the customers feedback and use such feedback to design. Depending on the feed-back, the store managers can clearly establish the kind of attires and shores to design. Therefore, the newly designed products become popular immediately after their release into the exhibition stores. They are purchased rapidly and the challenge of their designs being replicated is reduced. Therefore, the company manages to remain on top irrespective of extreme competition in fashion industry.

In relation to questions regarding why Zara has developed their company so fast to a top company in this few decades, the managers’ responses depicted that good customer relations has been crucial in the company growth.  Moreover, it is evident that Zara’s marketing strategy which focuses on expansion and quality has been crucial in rapid growth of Zara. Moreover, Zara’s mission, which is to move at the pace of the society is aspects such as fashion ideas and trends, has been significant in establishment of the marketing strategy. The need to move and the society’s pace has resulted in establishment of a supply chain that ensures manufacture products are supplied to the stores fast and sold before competitors can copy the design. This is crucial since the fashion industry is often faced by tendency of some companies to copy designs of others and make minima changes. This affects the marketability of the copied product since buyers may fail to differentiate the original from the imitation.

From the interviews it was evident that Zara’s expansion plan is based on the company’s philosophy, which aims at increasing profitability through use of customer friendly management and marketing strategies. Zara most of the managers agreed that the desire to supply affordable and qualitative fashion to the world has played a major role in Zara becoming so successful. Zara identifies the need for their product to be designed in relation to the target market. Therefore, they design various products for their store depending on their location and the culture as well as taste of people in the various regions. The major market needs identified in relation to Zara philosophy include exclusivity, differentiation from other competitor fashion companies and affordability. Moreover, their presence has been enhanced through online shopping enabling the company to reach prospective customers across the globe (Rowley, 2009).

4.4. Comparison of Reality (From the Research) Versus Literature

The findings of this research have been compared with existing literature on marketing mix as well as on Zara Company.  Various aspects identified in this study parallel findings in existing literature. Such aspects include the important role of 4P model in enabling accompany market its products and remain competitive (Kotler, Armstrong and Wong, 1996).  Another concept is that quality of a product defines its price and influences the brand image. If a product is of high quality, it is likely to have a high price and customer will still buy it irrespective of there being other companies making the same product. This has been demonstrated by the high demand for Zara products, which are considerably expensive but of high quality. Although most literature depicts promotion as very crucial in marketing of company products, this aspect is not strongly supported by this research. Zara rarely uses direct promotion in its activities. However, this has not deterred Zara from expanding rapidly and outperforming its competitors.  However the significance of price, place and product has been demonstrated significant in literature as well as in this study.

Chapter 5 : Conclusions and recommendations

This research is a portrayal of how Zara has been using the 4Ps model in its marketing.  The research aims at exploring how the various elements of 4Ps relate. Moreover, the research sought to establish how Zara is using the 4Ps (price, place, promotion and product) well to compete with their key competitors; how Zara overcomes the consumer behavior problem and make them always come to Zara. Moreover, the research focused on establishing the reasons Zara develop their company so fast to a top company in this few decades and the contribution of Zara philosophy in making the company.

Founded by Amancio Ortega in 1975, Zara is one of the largest and best performing fashion and Clothes Company in the world. The company was started in Spain where it is still headquartered and it is owned by Inditex Group. Initially Zara focused on low priced clothes before changing into a fashion designer and expanding its operations by opening numerous stores across the globe. From the above research it is evident that Zara has greatly invested in achieving its philosophy, goals and mission. The philosophy revolves around being the fastest designer, moving with fashion trends and meeting the customer’s preferences and tastes.  Zara has expanded rapidly which is attributable to various factors, one of them being having an efficient marketing plan. The marketing plan focuses on the 4Ps which stands for promotion, price, product and place. From the research, it has emerged that product and place are the most significant elements of Zara marketing plan. Zara ensures their designs are maximally flexible and change rapidly to suit the changing taste and preferences. Moreover, the fashion differ across the globe to suite the various cultures. In relation to place, Zara’s stores are strategically located in easily accessible places such as in large shopping malls. Although promotion is not a major marketing strategy for Zara, the company has managed to develop strong brand equity over time and word of mouth is currently their major source of promotion. Moreover, Zara’s dedication to bring its products near its customers by opening stores across the globe promotes its products. The use of mixed method which incorporates both qualitative and quantitative research is crucial. Quantitative research shows the trend of the variables under research while qualitative research helps in explaining such trends.

From the study, it has emerged that there is need for Zara to invest more in promotion in order to introduce its products to customers who have never used them. Using promotion will enable prospective customers identify with the unique nature of Zara products.

5.1. Research Gaps, Limitations and implications of this Research

There is need for research on whether the elements of 4Ps model can be implemented independently and the results from such implementation. Most studies, including this one analyses the four elements as a block. The study is limited due to its scope. The study involved 80 participants, 10 of whom were disqualified. Moreover, the participants were drawn from a few stores. This poses a challenge on the generalizability of this study.

The findings of this research imply that the 4P model is an effective marketing plan that can be used by companies within the fashion industry to enhance their operations and expand their operation globally.


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Appendices

Appendix 1: Questionnaire Questions

Section 1: How Zara uses the 4Ps (price, place, promotion and product) well to compete with their key competitors

Choose the most appropriate Option

  1. How would you rate Zara’s use of Promotion in marketing (very Useful, Useful,

Not Useful)

  1. Zara should consider increasing the use of promotion (Strongly Agree, Agree, Disagree)
  2. Zara should offer more promotions to attract customers (Strongly Agree, Agree, Disagree)
  3. The location of Zara stores attracts customers (Strongly Agree, Agree, Disagree)
  4. Zara should increase the number of items produced for every new design (Strongly Agree, Agree, Disagree)
  5. Zara requires to use advertisement to increase its sales (Strongly Agree, Agree, Disagree)
  6. Zara good quality products have contributed to Zara Success (Strongly Agree, Agree, Disagree)
  7. The high prices fixed on Zara products helps build strong image for Zara products (Strongly Agree, Agree, Disagree)

Section 2: How Zara overcomes the consumer behavior problem and make them always come to Zara

  1. Zara’s marketing strategy identifies the needs of customers (Strongly Agree, Agree, Disagree)
  2. Zara’s needs to identify ways of meeting the customer’s needs (Strongly Agree, Agree, Disagree)

Section 3: Why Zara develop their company so fast to a top company in this few decades?

  1. Zara fast channel from production to distribution has played a role in Zara’s success (Strongly Agree, Agree, Disagree)
  2. Zara philosophy is the major contributing factor Zara success (Strongly Agree, Agree, Disagree)
  3. Zara employee dedication is the major contributing factor to Zara success (Strongly Agree, Agree, Disagree)
  4. Use of appropriate marketing skill has contributed to Zara Success (Strongly Agree, Agree, Disagree)

Section 4: What is the Zara philosophy make them become so successful?

  1. Zara philosophy plays a role in enhancing Zara performance (Strongly Agree, Agree, Disagree)
  2. Zara marketing strategy is based on Zara’s philosophy (Strongly Agree, Agree, Disagree)

Appendix 2: Interview questions

  • How would you describe Zara marketing strategy?
  • How the products reach the stores from production
  • How do you determine the designs to produce
  • How fast are your products delivered to the store
  • How do you determine the price of you products
  • Have you ever received complaints from your customers? If yes, how did you deal with the complain
  • Your competitors use promotion as a major way of marketing, how would you describe Zara’s use of promotion
  • How often do you advertise you products?
  • What factors guides Zara’s operation?
  • Most of your competitors sell their products at considerably low prices, how do manage to compete with them?
  • How do you choose the location of your stores?
  • In your opinion, how does Zara marketing plan relate to Zara’s philosophy?

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