“ How did Zara Capture the Chinese Market? ” Damak Donia  杜宁 Marketing Management
<ul><li>What is Marketing Management? </li></ul><ul><li>Overview Zara </li></ul><ul><ul><li>Zara ’ s Success: Its Business...
What is Marketing Management? Marketing management   is the art and science   of  choosing target markets  and  getting , ...
From choosing target markets and building profitable relationships with them????? Questions to ask: <ul><li>What customers...
Target Marketing Market Segmentation: Divide the market into segments of customers
Value and Satisfaction If performance is lower than expectations, satisfaction is low. If performance is higher than expec...
<ul><li>Business </li></ul><ul><ul><li>The world ’ s fastest growing fashion retailer of Spanish Brand </li></ul></ul><ul>...
Business Model <ul><li>Supply </li></ul><ul><ul><ul><li>Whereas most retailers designed 60% at start season, Zara  designe...
Around the world South America: 30 stores Africa: 41 stores Asia - Oceania: 7 stores Europe: 407 stores North America: 47 ...
The industry Environment <ul><li>The Natural Environment </li></ul><ul><li>Free access to natural  </li></ul><ul><li>resou...
Market attractiveness <ul><li>Demand </li></ul><ul><ul><li>Industry  </li></ul></ul><ul><ul><li>Estimated GDP growth  </li...
Learning from Competitors:  H&M and Esprit in China <ul><li>Clothing, fragrances, sunglasses   and home textile  </li></ul...
SWOT analysis: Threats and Opportunities <ul><li>Huge untapped market </li></ul><ul><li>Changing lifestyle and clothing pr...
Key Success Factors <ul><li>Value </li></ul><ul><ul><li>Latest fashion with Chinese touch </li></ul></ul><ul><ul><li>Best ...
Strategic Recommendations to Capture the Chinese Market
Business Strategy <ul><li>Goal  </li></ul><ul><li>Fast growth in China   </li></ul><ul><li>How  </li></ul><ul><li>Implemen...
Logistics Strategy <ul><li>Localise and implement just-in-time and  ‘ quick response times ’  to demand </li></ul><ul><li>...
Marketing Strategy <ul><li>Product </li></ul><ul><li>Introduce the occidental range of clothes for men and women  </li></u...
<ul><li>Promotion </li></ul><ul><li>Promotion targeted at increasing awareness about Zara and the concept of  ‘ Fashion at...
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Zara是如何攻占中国市场的?marketing management,a spanish brand

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Zara是如何攻占中国市场的?marketing management,a spanish brand

  1. 1. “ How did Zara Capture the Chinese Market? ” Damak Donia 杜宁 Marketing Management
  2. 2. <ul><li>What is Marketing Management? </li></ul><ul><li>Overview Zara </li></ul><ul><ul><li>Zara ’ s Success: Its Business Model </li></ul></ul><ul><li>Marketing environment: </li></ul><ul><ul><li>China Marketing Environment </li></ul></ul><ul><ul><li>Market Attractiveness </li></ul></ul><ul><ul><li>Learning from Competitors: H&M and Esprit in China </li></ul></ul><ul><ul><li>SWOT Analysis:Threats and Opportunities </li></ul></ul><ul><ul><li>Key Success Factors to enter the Market </li></ul></ul><ul><li>Strategic Recommendations </li></ul><ul><ul><li>Business, logistic and marketing strategy </li></ul></ul>
  3. 3. What is Marketing Management? Marketing management is the art and science of choosing target markets and getting , keeping , and growing customers through creating, delivering , and communicating superior customer value .
  4. 4. From choosing target markets and building profitable relationships with them????? Questions to ask: <ul><li>What customers will we serve? </li></ul><ul><ul><li>What is our target market ? </li></ul></ul><ul><li>How can we best serve these customers? </li></ul><ul><ul><li>What is our value proposition ? </li></ul></ul>
  5. 5. Target Marketing Market Segmentation: Divide the market into segments of customers
  6. 6. Value and Satisfaction If performance is lower than expectations, satisfaction is low. If performance is higher than expectations, satisfaction is high. Expectation Performance 10 8 Expectation Performance 8 10
  7. 7. <ul><li>Business </li></ul><ul><ul><li>The world ’ s fastest growing fashion retailer of Spanish Brand </li></ul></ul><ul><ul><li>Ranks among the three “ global winners ” with Gap and H&M </li></ul></ul><ul><ul><ul><li> Compelling mix of fashion, price and quality </li></ul></ul></ul><ul><ul><li>First store in 1975. Today 536 stores within 30 countries worldwide </li></ul></ul><ul><ul><ul><ul><li> 199 openings in 2009 </li></ul></ul></ul></ul><ul><li>Financials </li></ul><ul><ul><li>Sales: €4.5 Bn in 2008 </li></ul></ul><ul><ul><li>International sales 60% of total turnover </li></ul></ul>Overview
  8. 8. Business Model <ul><li>Supply </li></ul><ul><ul><ul><li>Whereas most retailers designed 60% at start season, Zara designed 15%  Dump unpopular product line </li></ul></ul></ul><ul><ul><ul><li>Deliver fashion “ when the customer desires ” </li></ul></ul></ul><ul><ul><ul><li>Twice a week delivery schedule </li></ul></ul></ul><ul><li>Demand </li></ul><ul><ul><ul><li>No advertising or promotions </li></ul></ul></ul><ul><ul><ul><li>10,000 new items at highly competitive price </li></ul></ul></ul>
  9. 9. Around the world South America: 30 stores Africa: 41 stores Asia - Oceania: 7 stores Europe: 407 stores North America: 47 stores
  10. 10. The industry Environment <ul><li>The Natural Environment </li></ul><ul><li>Free access to natural </li></ul><ul><li>resources for textile clothing </li></ul><ul><li>Demographic Structure </li></ul><ul><li>1.7 billion people </li></ul><ul><li>85.2% literacy rate </li></ul><ul><li>Skilled labour available </li></ul><ul><li>English speakers Exist </li></ul><ul><li>Social Structure </li></ul><ul><li>around 8 national languages </li></ul><ul><li>Country of two speeds: urban vs. rural </li></ul><ul><li>‘ New ’ middle class with purchasing </li></ul><ul><li>Cultural shift in urban areas </li></ul><ul><li>Technology </li></ul><ul><li>Easy access </li></ul><ul><li>Financial benefits </li></ul><ul><li>Chinese Economy </li></ul><ul><li>GNP per capita $ 5890 </li></ul><ul><li>GDP growth of 10.7% </li></ul><ul><li>Industry/service economy </li></ul><ul><li>Government & Politics </li></ul><ul><li>Deregulation of most sectors </li></ul><ul><li>New textile policy </li></ul><ul><li>Stable communist country </li></ul>Marketing Environment: China case
  11. 11. Market attractiveness <ul><li>Demand </li></ul><ul><ul><li>Industry </li></ul></ul><ul><ul><li>Estimated GDP growth </li></ul></ul><ul><ul><li>of 6-7% in fashion industry </li></ul></ul><ul><ul><li>Undersupply for </li></ul></ul><ul><ul><li>branded fashion products </li></ul></ul><ul><ul><li>Target markets </li></ul></ul><ul><ul><li>30% potential customers </li></ul></ul><ul><ul><li>for branded fashion products </li></ul></ul><ul><ul><li>60% estimated for 2010 </li></ul></ul><ul><li>Supply </li></ul><ul><li> Design </li></ul><ul><ul><li>World class design schools </li></ul></ul><ul><ul><li>Production </li></ul></ul><ul><ul><li>High innovation potential </li></ul></ul><ul><ul><li>for manufacturing </li></ul></ul><ul><ul><li>procedures </li></ul></ul><ul><ul><li>High productivity potential </li></ul></ul><ul><ul><li>Cheap and skilled labour </li></ul></ul><ul><ul><li>force </li></ul></ul><ul><ul><li>High investment in </li></ul></ul><ul><ul><li>technology </li></ul></ul><ul><ul><li>Distribution </li></ul></ul><ul><ul><li>High investment in </li></ul></ul><ul><ul><li>customer delight ’ malls </li></ul></ul>                                      
  12. 12. Learning from Competitors: H&M and Esprit in China <ul><li>Clothing, fragrances, sunglasses and home textile </li></ul><ul><li>Introduced watches and accessory ( departure from its global tradition ) </li></ul><ul><li>luxury brand </li></ul><ul><li>High Prices </li></ul><ul><li>Shopping mall and shopping aria </li></ul><ul><li>Advertisement in the streets and in the metro stations </li></ul><ul><li>Want to be known as a provider of quality Product </li></ul>Esprit <ul><li>casual, formal and party wear </li></ul><ul><li>three collections per year </li></ul><ul><li>Brand extensions: bags, caps, sunglasses, wallets and fragrances </li></ul><ul><li>Premium price </li></ul><ul><li>Strong control on promotions </li></ul><ul><li>International option a t high quality / price ratio </li></ul><ul><li>international forma t in major cities ( large shopping malls ) </li></ul><ul><li>Focus on metros and modern cities </li></ul><ul><li>Strong support on printed media ( adapting to Chinese culture ) </li></ul>H&M Product Price Place Promotion
  13. 13. SWOT analysis: Threats and Opportunities <ul><li>Huge untapped market </li></ul><ul><li>Changing lifestyle and clothing preferences </li></ul><ul><li>Demand outstrips supply!! </li></ul><ul><li>Cheap labour and opportunities for local sourcing </li></ul><ul><li>High productivity potential </li></ul>Opportunities <ul><li>Low entry barriers </li></ul><ul><li>Customer bargaining power </li></ul><ul><li>Unpredictability of consumer behaviour </li></ul><ul><li>Product quality </li></ul><ul><li>Traditionalism </li></ul>Threats
  14. 14. Key Success Factors <ul><li>Value </li></ul><ul><ul><li>Latest fashion with Chinese touch </li></ul></ul><ul><ul><li>Best Prices </li></ul></ul><ul><ul><li>Product quality </li></ul></ul><ul><ul><li>Variety </li></ul></ul><ul><li>Cost/Speed </li></ul><ul><ul><li>Local sourcing of raw material </li></ul></ul><ul><ul><li>Vertical Integration of supply chain </li></ul></ul><ul><ul><li>Fast time-to-customer </li></ul></ul><ul><ul><li>Mass customization </li></ul></ul><ul><ul><li>Low process costs </li></ul></ul>
  15. 15. Strategic Recommendations to Capture the Chinese Market
  16. 16. Business Strategy <ul><li>Goal </li></ul><ul><li>Fast growth in China </li></ul><ul><li>How </li></ul><ul><li>Implement Zara business model </li></ul><ul><li>Introduce European supply chain system with fine tuning to suit the Chinese market </li></ul><ul><li>Customise the marketing mix </li></ul>COMPANY COMPE- TITOR CUSTOMER COST/ SPEED VALUE/ SPEED VALUE / SPEED
  17. 17. Logistics Strategy <ul><li>Localise and implement just-in-time and ‘ quick response times ’ to demand </li></ul><ul><li>Modernising the supply chain with the use of information technology </li></ul><ul><li>Forge strong relationships with ‘ value chain partners ’ (suppliers and delivery co) </li></ul>
  18. 18. Marketing Strategy <ul><li>Product </li></ul><ul><li>Introduce the occidental range of clothes for men and women </li></ul><ul><li>Introduce a small section of Chinese clothes designed by ‘ upcoming Chinese designers ’ through mass customisation </li></ul><ul><li>Introduce cotton clothes for the summer and woollen/synthetic one for the winter collections </li></ul><ul><li>Price </li></ul><ul><li>Use penetration pricing (20% lower than Esprit) </li></ul><ul><li>Stay away from the promotion by ‘ sale ’ paradigm of H&M </li></ul>
  19. 19. <ul><li>Promotion </li></ul><ul><li>Promotion targeted at increasing awareness about Zara and the concept of ‘ Fashion at great value ’ </li></ul><ul><li>Use of print and television media </li></ul><ul><li>Tie up with colleges to sponsor their festivals to increase awareness and ‘ catch them young ’ </li></ul><ul><li>Place </li></ul><ul><li>Set up factory in the Factories area </li></ul><ul><li>Find at least more then 5 stores in the big cities. </li></ul><ul><li>Open Zara stores in the most shopping avenue and big malls. </li></ul>Marketing Strategy
  20. 20. Thank You For Your Attention

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