The digital transformation is helping the fashion industry to increase its capacity to use and produce the data of customers, which was not possible for the industry due to financial or technological issues. Needles, tools to cut stones, scissors, artificial intelligence and others are determined as the technologies related to the industry of fashion (Ha, 2021). Zara was founded in the year 1975, which is increasing its profits in different markets with the use of technological innovation. Moreover, the use of technology is also helping the company to improve its customer experience, and it is also increasing the growth of the firm. The brand image of Zara has developed its socio-cultural aspect, which is increasing the profits of the company in different markets (Matasci et al., 2018). The company is providing good quality products at a low price, and it is influencing the customers in different markets. The strong and positive presence of the brand and the use of technology is enabling the organisation to increase its profits for the shareholders. The online trend of shopping by the customers and its utilisation by Zara has increased its social presence in the global market. The use of technology has helped the company to increase the popularity of its webshop with the use of technologies, which is increasing the traffic and sales of the company through online stores (Kaakkurivaara and Kaakkurivaara, 2018). The focus of Zara on Big Data is determined as the success of the company towards the use of technology, which is increasing its growth. The study and the analysis of huge data sets by Zara are enabling the company to increase its interaction with the customers, which is also increasing the technological aspects of the company in different markets. The use of technology has increased the reach of Zara towards a large number of customers. Increased customer base is being gained by Zara with the fundamental use of Facebook, which is also helping in increasing the interaction (Marimuthu et al., 2018). Furthermore, Zara is also increasing its popularity among customers with the help of influencers. Advertisements for the targeted customers is another technological aspect this helps Zara to increase its reach to a large population. The use of technology and promotional methods are helping the company to engage its customers to influence their buying habits (Pilecka, Zi?ba and Szwarkowski, 2021). The sustainability pledge on the website of Zara is enabling the company to evaluate its concern about the environment. Reducing the use of water and energy is also evaluating the environmental concerns of the organisation. The low cost of labour and increased employment rates are enabling Zara to increase its economic growth. Carrying out the operations related to the manufacturing of products in Spain is reducing the cost of producing products, which is enabling the company to improve its brand image positively.
Porter’s five forces are determined as the strategy that evaluates the power of buyers, suppliers, competitive rivalry, the threat of substitution and new entries. The bargaining power of customers in the fashion industry is increasing due to the manufacturing of similar products by different companies is, increasing the bargaining power of customers in different markets (Gazzola et al., 2020). The products provided by Zara are of high quality, which is determined as low-priced. These are influencing the company to gain advantages by reducing the bargaining power of customers. The availability of other brands in a similar market is enabling the customers to gain better power while bargaining. Several firms are providing discounts and offers, which is increasing the bargaining power of consumers. Moreover, the bargaining power of suppliers is unable to influence fashion companies. The companies have improved bargaining power over the suppliers, as the suppliers are from different countries (Thorisdottir and Johannsdottir, 2019). The availability of a large number of suppliers is increasing the bargaining power of fashion brands over them. On the other hand, globalisation has increased the opportunities for fashion companies to operate in different markets with the implementation of technological aspects. It is increasing the threat of entering new companies in different markets. The increasing threats for fashion companies are drastically affecting the adoption of appropriate strategies due to the focus on several aspects. The chances of entering new companies in a market are increasing due to the availability of digital methods for marketing. On the other hand, the threat of substitutes is another aspect that is affecting the adoption of appropriate strategies by companies like Zara in the fashion industry (Niinimäki et al., 2020). The threats from substitute companies are increasing from existing firms due to the availability of different tools and strategies. Additionally, the competitive rivalry for Zara is also increasing in different markets due to the operations of a large firm and the manufacturing of similar products.
Several factors are providing advantages to Zara, which are helping the company to generate increased revenue. The resources are helping the company to increase its competitive advantages, along with growth. The competitive pricing strategy adopted by the firm is helping in attracting a large customer base (Cui and Fan, 2021). The primary focus of the company towards style and quality is helping Zara to implement its competitive pricing strategy. Moreover, the services provided by the company to its customers is enabling Zara to improve its brand image among the consumers. The brand image of the company is increasing the loyalty of customers, which is possible for the firm due to the implementation of technologies. The quality of services of Zara is allowing the firm in improving the shopping experience of customers, which is increasing loyalty. The increased number of loyal customers is also being gained by the company due to the usage of different “digital media platforms”. The quality of products and the services of the company, with the help of technology, is enabling the form in improving the shopping experience of purchasers (Amarkhil, 2018). The maintenance of its business model is helping Zara to increase its growth and profitability in the international domain. The business model is also able to improve the in-store experience of buyers, which is also increasing the satisfaction of purchasers. Another effective factor that is helping Zara to gain competitive advocates is determined as the maintenance of its supply chain. The strategic sully chin and its efficient design are enabling the company to increase the experience and satisfaction of customers with the help of technologies. The company is gaining improved results from different markets due to the efficient design of its strategic supply chain. The implementation of innovative technologies is enabling the company to increase the loyalty of customers and improve their satisfaction level with appropriate engagement (Ly, 2021). The use of technology and increased loyalty of the customers are providing advantages among its rivals in the fashion industry. On the other hand, the focus of the company on external expansion has increased its presence in the global arena. The focus of the company on international expansion has allowed in increasing the number of stores, along with its online presence. The operations in e-commerce websites are also helping the company to gain competitive advantages with the use of technologies.
Figure 1: VRIS Model of Zara
(Source: Created by Author)
The VRIS model of Zara evaluates that the company is increasing its profitability in the market by evaluating its value to the customers, which is essential for the increased loyalty of purchasers. The firm is also gaining improved loyalty of purchasers with the appropriate value provided to the buyers. The technologies used by the company is helping in improving the advantages (Cui and Fan, 2021). Furthermore, the maintenance of the improved quality of products and services are helping the company to gain advantages by increasing the value of customers. The technologies are also allowing the firm to increase the rareness of its products and services (Gamaleldin and Maniar, 2020). Rareness and the products provided by Zara are enabling the company to increase its position in the market, which is providing advantages to the company. Zara is also gaining competitive advantages with the help of technologies, as these are helping in improving the brand image among the purchasers. The increased rareness of the products of Zara is helping the company to gain competitive advantages, as the technology is enabling the company to gather data of customers (Amarkhil, 2018). Both the value and rareness is increasing the ability of Zara to establish brand image and trust. The imitability of the company is also increasing its sustainability in the market. However, imitability is developing the brand image of the company by increasing its advantages towards sustainability. The sustainability of the products is also increasing due to the usage of technology in the process of manufacturing (Putera, Rakib and Sahabuddin, 2021). These are increasing the sustainability of the company, as technology is improving the interaction with the consumers. The ability of Zara towards increasing its sustainability and the potential towards earning more profits is increasing with the technology. In addition, the increased ability of the company towards earning an improved profit is increasing the growth of Zara towards gaining advantages in the market, which is also improving the potential of earning profits. It is essential for the company to interact with customers to earn more profits from the markets (Gravier, Roethlein and Visich, 2018). The company could use “social media platforms” to interact with customers on a regular basis and gather their data. Additionally, the data of customers and their feedback will help Zara to make changes in the products and services as per the demand of purchasers.
Improving interaction with customers through “social media platforms.”
It is essential for Zara to increase its interaction with customers for the identification of the needs of purchasers. The interaction with the customers is able to help the company to understand the needs of purchasers. It will also help Zara to gather more feedback from the customers, which will help in making changes as per the demand of buyers. It is recommended for the company to increase communication with customers by using “social media platforms” for better interaction. Zara will also be able to increase its brand image among the customers by increasing its communication through “social media” with the purchasers. The growth and sales of the company will also increase with the improved communication with consumers.
Increasing engagement of customers
The engagement of customers is determined as one of the effective aspects for companies to increase growth and performance. Thus, it is recommended Zara that it need to improve the engagement of customers by providing different information. The information about the manufacturing process will increase the growth and performance of the company. Furthermore, the increased engagement of purchasers with different information will help in gaining competitive advantages. Furthermore, the engagement of buyers will help the firm to use the data of customers, which will help in increasing the brand image. The information through attractive advertisements by Zara will help in increasing brand image among the purchasers. The growth and profitability of the company will also increase with the increased engagement of buyers.
Providing improved quality of products at a low price
The customers of the fashion industry are focusing on purchasing improved quality products at a low price. The products at a low price will help companies to attract a large population towards different products. Thus, it is recommended to Zara that it needs to improve its product quality. The improved quality of products will help Zara to gain advantages by improving the quality of its products and services. It will also increase the growth and profitability of the company. On the other hand, the reduced price of products is also essential for Zara to gain advantages from the markets. The low-priced products of the company will help the firm to improve its growth and profitability.
Reference
Amarkhil, H., 2018. Brand management that creates value to customer: the case of Zara brand (Master’s thesis).
Amarkhil, H., 2018. Brand management that creates value to customer: the case of Zara brand (Master’s thesis).
Cui, Y.C. and Fan, B.F., 2021. The corporate social responsibility strategy in fast fashion industry: case company Zara.
Cui, Y.C. and Fan, B.F., 2021. The corporate social responsibility strategy in fast fashion industry: case company Zara.
Gamaleldin, W. and Maniar, N., 2020. Textile Value Chains Competitive Advantages of Local Manufacturing in High-Cost Countries.
Gazzola, P., Pavione, E., Pezzetti, R. and Grechi, D., 2020. Trends in the fashion industry. The perception of sustainability and circular economy: A gender/generation quantitative approach. Sustainability, 12(7), p.2809.
Gravier, M., Roethlein, C. and Visich, J.O.H.N., 2018. The competitive advantages of the digital economy require a digital mentality. European Business Review, 1, pp.50-53.
Ha, J., 2021. Zara Strategic Analysis.
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Ly, B., 2021. Competitive advantage and internationalisation of a circular economy model in apparel multinationals. Cogent Business & Management, 8(1), p.1944012.
Marimuthu, K., Vynatheya, S., Vasudev, N. and Raja, P., 2018, December. Quality Analysis of Ceramic Insulators Under Steep Front Impulse Voltage. In 2018 20th National Power Systems Conference (NPSC) (pp. 1-5). IEEE.
Matasci, B., Stock, G.M., Jaboyedoff, M., Carrea, D., Collins, B.D., Guérin, A., Matasci, G. and Ravanel, L., 2018. Assessing rockfall susceptibility in steep and overhanging slopes using three-dimensional analysis of failure mechanisms. Landslides, 15(5), pp.859-878.
Niinimäki, K., Peters, G., Dahlbo, H., Perry, P., Rissanen, T. and Gwilt, A., 2020. The environmental price of fast fashion. Nature Reviews Earth & Environment, 1(4), pp.189-200.
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Thorisdottir, T.S. and Johannsdottir, L., 2019. Sustainability within fashion business models: A systematic literature review. Sustainability, 11(8), p.2233.
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