Zara Case Study Sample

• Subject Name : Marketing strategy

Online Marketing Strategy as A Driver for Market Expansion in Qatar Clothing Industry

Table of Contents

1.0 Introduction:

1.1 Digital or online marketing: 

1.2 Online Marketing Strategy adopted by different brands in Qatar

1.3 Objective:

2.0 Literature Review:

3.0 Methodology:

5. Results:

6. Conclusion:

References

1.0 Introduction to Qatar Clothing Industry:

1.1 Digital or Online Marketing:

The Fashion industry has been changing over the years and fashion companies have changing the way of conducting business. They increasingly focus on the consumer and what he's looking for right now. The concept of Fast Fashion has been gaining ground in the industry, because now it is more important to follow the latest trends and produce accordingly. Now consumers are constantly looking for different products, and fashion companies that are able to give them that will achieve more success easily.

If companies are not active in marketing thei business via the Internet in 2020, will likely to be miss many opportunities and abundant money. Although Internet marketing seems cumbersome and complicated for many entrepreneurs and businessmen at the beginning of their career path, this method of thinking deters many of them to go ahead with their digital marketing plans. Digital clothing marketing is one of the best ways to help improve sales and brand presence, it also helps increase brand awareness and can be easily tracked so you can get instant feedback and find out the campaign is working or not.

1.2 Online Marketing Strategy Adopted by Different Brands in Qatar

Qatar is an important market for digital marketing opportunities in the Middle East. The Internet population is 1.5 million, over 85% of the total population and is one of the most connected countries in the Middle East. In 2013, the number of mobile subscribers in Qatar reached 3 million and is expected to increase by 3.7% per year. Qatar also has the highest per capita gross domestic product in the region of $ 102,100, which drew its wealth from natural gas reserves. Qatar's vast wealth makes it a profitable market for online business and digital marketing.

In 2012, Qatari's e-commerce expenses totaled $ 0.7 billion and are expected to increase to $ 1.25 billion by 2015. Unlike Western consumers, Qatar's preferred payment method for shopping online is cash on delivery (cash on delivery). This preference is widespread across the Middle East as Internet users fear fraud and distrust of online payments. Few goods are purchased using cashless payment services such as credit, debit or PayPal. Arab online content publishers are starting to appear fast and hit Qatar. Many advertisers target the Gulf region in the Middle East because it is relatively stable compared to the Levant region or North Africa. This resulted in higher inventory prices online. Many businesses can face advertising challenges on high-quality sites in Qatar (and the Gulf region), where add networks are still fragmented. Therefore, it is very difficult to see a positive return on investment in online advertising spend.

In this project, we have taken the case of a very famous Spanish clothin Brand “Zara” and determined their digital marketing strategi.

1.3 Objective of Qatar Clothing Industry:

This case aims to study Zara's strategy, from the supply chain supply to marketing and communication strategies, and also compare the

strategy in physical stores with those of the online store. Then the study will focus on the consumer, his behavior taking into account different generations and their brand perception. A market study, through a online survey, will be conducted to help the development of this study.

Following are the main aim of the project;

• Conduct a literature survey based on digital/ online marketing strategies
• Determine the factors driving market expansion
• Developing a framework of expanding the marketing based on online marketing strategy of Qatar using the case study of Zara, A Spanish brand.

2.0 Literature Review of Qatar Clothing Industry:

Advertisers have since quite a while ago acknowledged that success or achievement in the competitive markets needs the recognition of the competitive advantages that are capable enough to distinguish an association from others working in a similar market sector. This literature review will discuss the few internet marketing strategies and approaches. Then, the competence marketing strategy will be developed for the Internet markets (Ian, 2001).

By applying the characteristics of the virtual market, an organization would be able to reduce massively the information processing’s cost and also enables profound changes in the techniques or ways by which businesses operate, as well as, how the economic exchanges are organized. Further, it also creates or opens a lot of new opportunities for both wealth and value creation. But, marketing strategies used in such markets should be of new type and different (C, 2001). Numerous authors have explained Internet marketing strategies based upon the 4Ps framework, however, according to many other researchers, the marketing strategies are something beyond 4Ps (Jarneau, 2001).

In terms of efficiency and effectiveness, the information in virtual markets is influencing fundamentally the dimensions or magnitudes of the competitive advantage. Generally, it concentrates greatly on inspecting the success of advantages for a physical output about effectiveness, after this, a market space provides improvement potentials in the following two ways (Kollmann, 1998).

• Increment in effectiveness/viability through the securing/acquisition of data.
• Increment in effectiveness/viability through the exchange/transfer of data

In internet marketing, the internet is used for communication, to provide massive information, and to perform transactions. Fundamentally, the internet is an omnipresent information platform, which allows external and internal customers to decrease costs for customers as well as for firms. So, in this case, all companies can be a speed-leaders or topical-leaders in a market space.

In 2002, Toe argued that in order to achieve the complete growth for any company, online making strategies should be set into five main categories i.e. to Attract, Engage, Retain, Learn, and Relate. Further, in the modern competitive environment, it is progressively clear that fruitful marketing techniques depend on an amalgam of three basic components (Teo S. H. and Tan J. S., 2002). These components include:

1. Development of the consumer franchise: in which all the end-users are significantly attracted to service/products due to perceived superior offers.

2. Robust customer franchise: whereby intermediaries greatly want to do work or business with us due to a substantial economic benefits/advantages.

3. Under-pinning effectiveness of supply chain: which delivers prevalent assistance at the lowest cost.

The below figure explains the three main sources for marketing advantages by applying marketing strategies:

According to Kassaye, there are total five categories in which the Internet marketing strategies are divided i.e. Experimental strategies, Entry strategies, Consolidation strategies, Nichiny strategies, and Assortment of the incremental strategies (Kassaye, 1997).

For reconciling and clarifying the numerous streams and views of marketing, in 1997, Boride designed the classification scheme depend on the synthesis of North American and European schools of thought regarding marketing, across the channels, interaction, service, and research network streams. From this, two general marketing perspectives were identified encompassing four distinct types of marketing. Thus, from this case, we identified two common marketing perspectives that encompassing three distinct marketing types.

1. Relationship marketing (Interaction marketing and Database marketing)

2. Transitional marketing

3. Network marketing

In 2002, technological ship marketing has been added to this perspective and the author explained that in the technological ship marketing all the customers are significantly deliberated more individually as well as products are all defined and specified by the customer. So, in such a perspective, the rules of marketing revolve continually, driven by technology, and the market is borderless by default (J, 2002).

Few authors explained and argue one-to-one strategies for marketing in an Internet market The One-to-one strategies are considering very necessary such as for customers identifications, to differentiate customers, for interaction with all customers, and services or products personalization to the tailor-suit customers. The most common one-to-one strategies are customization, recommendation, and personalization systems (Weng S. and Liu M. J., 2003).

3.0 Methodology on Qatar Clothing Industry:

In order to expose the basic ideas and thoughts to develop this case study "Online marketing strategies used in ZARA", it is significantly important to thoroughly illustrate the methodology used for study exploration.

To develop this case study, both primary and secondary method has been used to collect information or data about the company as well as their consumers. First of all, it is important to understand deeply about ZARA, the strategies (employees, product, management, suppliers, internationalization and sustainability concerns), marketing, their supply chain, as well as, the fundamental communication ways. Then, secondly, comprehend the significance that the customers have to the organization, and study the behavior of consumers by considering their generation.

Generally, the Secondary Data is considered as information that has been gathered previously, and then this data is distributed or published by others. For this case study, I gathered information from academic papers, books, Zara's site, and Inditex and by reviewing annual reports, and also studied articles from newspapers and magazines, and all the data accessible on the web that was valuable for my examination. Whereas, the Primary Data is considered as the information that was gathered by me in order to improve my exploration with various data. Furthermore, in this case, study, an online survey is conducted for measuring the behavior of consumers in Qatar (physical and online shopping) and the perception of the brand in Qatar. In this survey, both the open and closed questions have been asked to study the spontaneous and directed notoriety, respectively

For the resolution and analysis of the case study, the set of both qualitative and quantitative information is required to conduct in-depth analysis.

For this case study, the quantitative tools which are as follows:

• Each brand contribution to the total sales of Inditex;

• The total number of stores by the end of the year 2015.

Conversely, through qualitative tools we will be able to understand the case resolution:

• It is essential to know the background of Mother Company i.e. Inditex to know how and when everything began;
• Each brand’s short presentation such as their foundation year and the main concept to start the business. This is essential to know more about the company;
• ZARA’S history and how they gained success by applying expansion strategies.
• The ZARA’s every area of development to understand this company overall.
• The H&M history which is the main Zara’s competitor, which will explain the major differences in the way they defined their strategies;
• The Literature Review is significant to understand deeply the major tools behind this case.

5. Results of Qatar Clothing Industry:

This section shows the results of survey conducted. I sent the questionnaire to the 658 respondents and asked them if they know the Zara brand, all the respondents answered yes. Out of 100 % of respondents, 90.3% were costumer of Zara and merely 9.7% were not. Thus, in this case, study, the only those respondents are considered who are customers i.e. on average 595 respondents, and they evaluated the following characteristics of Zara: quality, products, a variety in the products, all occasions and seasons clothes, products as per new trends, different styles of clothes are available, quality/price relation, store environment, store design, store location, and employees’ assistance.

Based on the answer to the question ‘What are the prime reasons for shopping in Zara’, I verify that the following are the foremost reasons such as the store's location, good quality and prices of products, availability of huge cloth varieties in the store.

On the basis of market research, it is possibly verifiable that majority respondents used to visit the ZARA stores in QATAR less than one time every month (37.1%), whereas, 21.8% of respondents come to stores once in every month, few respondents visit at least two times in each month (16,1%) and 10,4% visit the store three times each month and the remaining visit more than four times each month (14,5%). Out of them, approximately 64.2% of consumers buy personal use products, whereas, just 3% buy products from the offer. Though 32.9% of respondents buy products for personal use as much to offer.

Furthermore, on the question ‘What people usually buy for Zara’, I verify that more frequently they buy casual clothes (i.e. 47.8%), special occasions clothes (i.e. 20,3%), work clothes (i.e. 16%), accessories and bags (7%), shoes (8,5%), and only 0.4% people buy sports clothes which is less sold clothes. Through the survey, I also found that the best marketing strategy of ZARA is that they have introduced their ungendered line and these clothes can be used by both men and women.

Their Internet marketing approach is Zara has developed its online shopping app and this APP is also available in smartphones. With the Fashion App of Zara, the process of online ordering is becomes so easier, as well as, the customer can easily access to comprehensive information regarding shipping and payment. This App offers a function where it can read bar codes which is extensively useful for all customers and they easily find online or in-store products. Thus, on the basis of market research, it is found that around 30.1% of respondents use just its Website on laptop or computer to check products, while 8,2% searched the products using Mobile App and only 12.9% of respondents use both. Though, there are 48.7% of people don’t use any of these options. Further, I verify from the question ‘Do public use online platforms of Zara and for what reason they use this platform’ that around 43% visit the ZARA’s online platform to check new products but prefer or desire to buy them only in a physical store, whereas, only 8,2% not only visit platform but also buy online products.

Thus, from another question ‘If those respondents who visit, bought already something online, but if they did not buy anything, what is the major reasons behind it’

The respondents who visited the online platforms have bought a few products online (26,7%), while, 24,5% of respondents never did shopping. So, the main reasons for not buying any product online: they don’t get the chance to try the product (91.1%), so, (52.7%) respondents prefer to purchase their products from stores as well as 15,8% respondents also don’t trust a payment method. Furthermore, the main reason for buying online products is: Due to non-availability of desirable product at the stores (50,9%), and 22,6% respondents found it easier to purchase products easily by sitting at home at any time, while, 21,4% respondents thought that more products are available in the online platform as compared to stores.

6. Conclusion on Qatar Clothing Industry:

Internet use has increased dramatically in recent years. Companies use the World Wide Web (WWW) to collect, publish, and exchange information with real and potential clients, and therefore Internet technology appears to be introduced and applied as a strategic tool and affects company strategies and practices, such as Porter's competitive strategies. Many research findings confirm and support the positive effects of the Internet on the company's competitive advantage.

This case study was based on the Spanish brand Zara and the only interesting fact is that they do not invest in advertising and this also does not prevent the brand from achieving success. Their marketing strategies are always in store, and within them the environment is carefully planned to offer the best possible shopping experience to the consumer. This case study aims to provide students with a deeper understanding of Zadar's strategy and what motivated them today, how they adapt to Qatar and their cultures, the strategy of their shop and how to improve their online presence. Khatt, understand the perception of the brand based on its customers and study consumer behavior, taking into account the different generations

Finally, Western brands are very popular with consumers in the Middle East It proved possible, as is usually the case with the creation of oriental objects created by the West Logos. Middle Eastern consumers who care about their social status will remain among their peers Loyal to luxury brands and consumers can keep loyal to their traditions while exploring Luxury western brands. As in the case of Zara, they are adopting various marketing strategies which is digital in Qatar and attracting huge customers. .

References for Qatar Clothing Industry

C, A. R. a. Z., 2001. Value Creation in e-Business. Strategic Management Journal, pp. 493-520.

Ian, C., 2001. E- Marketing Strategies, Mc- Graw Hill, s.l.: s.n.

Jarneau, B. R. B. P. a., 2001. Contemporary Strategic Marketing, s.l.: s.n.

J, T. R., 2002. Corporate Intelligence and Transformational Marketing in the Age of the Interne. Marketing Intelligence & Planning,, pp. 259-268.

Kassaye, W., 1997. The effect of the World Wide Web on agency-advertiser relationships: towards a strategic framework'. International Journal of Advertising, Volume 16, pp. 85-103.

Kollmann, W. R. a., 1998. Competitive Advantages in Virtual Markets –Perspectives of Information–based Marketing in Cyberspace, s.l.: s.n.

Teo S. H. and Tan J. S., 2002. The Case of Singapore, Internet Research: Electronic Networking Applications and Policy. Senior Executives' Perception of Business – to – Consumer [B2C] Online Marketing Strategies.

Weng S. and Liu M. J., 2003. Feature–based Recommendations for One–to –One Marketing, Expert Systems with Applications, s.l.: s.n.

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