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1. Company Profile/ introduction on Zara

The Spain- based Zara, "the world's largest clothing retailer owned by Inditex" (forbes pull), has time and time again proved that the strategies that they use have certainly contributed to the international success of the brand. The essence of Zara's success, stems from their primary focus which is customer experience (forbes pull). For Zara, "it is all about the customer- experiences for the customer, exchange with the customer, evangelism through the customer and being in every place for the customer" (forbes pull). In the up-and-coming economy of retail, there has been a shift in mindset, going from the idea that the product is king, rather to "experience matters more than product in the mind of the shopper" (forbes). Zara certainly gives a reason for their customers to continually come back to their stores to "catch the hottest trends at affordable prices" (forbes pull). Through this, Zara has made sure that they are always cultivating an environment for their customers become increasingly loyal to the brand (forbes pull).

The brand has understood the formula to success within the fast fashion industry. This would include the combination of "frictionless shopping in a highly curated product environment offering scarce supply and new styles that rotate rapidly" (forbes pull). Prior to this selling strategy, the success to fast fashion was rather selling in bulk and also selling it at a cheap price. However, the concept of exchange certainly has found its place in the modern retail economy. The simple exchange of money for a product, no longer satisfies todays customers, as they "strive for deeper connections with the brand" (forbe spull). Even though today Zara is certainly not the cheapest brand among their fast fashion competitors, their success lies consistency, and always providing "trend-right products at appealing prices" (forbes pull). Another aspect of their strategy that contributes significantly to their success lies in their location strategy, which however will be further questioned within the case study, through their penetration into the Indian market. Zara's "flagship locations are located in the most critical markets" (forbe spull). ""Zara has the courage to continually strengthen their portfolio of stores by closing unprofitable ones, opening new markets, and expanding sister brands in existing markets." (forbes pull).This concept of their expansion strategy will be further explored in this case study, as Zara's penetration into a brand-new market has not proved to be as succesful as their strategies aspire to be.

2. Zara Covid-19

Zara is definitely one of the leading brands in terms of fashion and clothing. As of 2020, Zara has expanded its reach in 88 countries with over 2,200 stores across the globe. Just like all other business in the world, this clothing company also faced difficulties when the COVID-19 Pandemic struck. They have closed an approximate 1,000 to 1,200 stores situated in Africa and Europe as of June in the last year. This is due to the fact that the clothing company might not be able to gain the same profit and sales as they did before the pandemic had struck them. These closures could be preventive measures to drastic losses which would be fatal to the clothing line'slongevity in the market. However, despite these closures, this clothing giant decided to penetrate one of the most populated countries in the world- India. This decision made by Zara could be a make or break situation for the company's way to bounce back from the losses they incurred due to the pandemic.

As we all know, India has a very rich culture that is much different from the usual target market of Zara.Thus, penetrating a brand-new market that Zara has now been present in before, could perhaps be the much-neededchallenge forZara's designers and their clothing lines to address thecustomerneeds and wantsinthe Indian market.There are various challenges that Zara may face coming into this market that they have not needed to deal with prior to entering the new market segment in India. However, there are certainly strategies that Zara has continuously employed, contributing to their major success as a major brand internationally, which can perhaps be applied to their strategy in entering India. Zara as a brand, heavily.

Zara business model- Products that are an integral part of the Zara Business Model: Different types of products that Zara manufactures are: Men's and women's clothing, Children's clothing (Zara Kids), Beauty and Lifestyle Products, Accessories.

Zara economic business model presents key partners: raw materials suppliers such as brands from fashion groups (Zara Home, Massimo Dutti, Pull and Bear), manufacturers (Spain, Portugal) known personalities (e.g., bloggers), and Inditex (Inditex is one of the world's largest fashion retailers, with eight brands (Zara, Pull&Bear, Massimo Dutti, Bershka, Stradivarius, Oysho, Zara Home) selling in 202 markets through its online platform or its over 7,000 stores in 96 markets. Activities are renewing design, logistics, sales, customer service. Zara resource's excellent location of shops, experienced stores managers, focus on customer preferences, over 2100 stores located across 88 countries. The company's value proposition is accessible price clothes, one of the strongest brand in the world, fashionable, and place (located on main shopping streets in big cities, and Zara targets the big malls to launch its shops to be closer and easy to reach for the customers). The relationship between customers is free shipping for orders over 30 euro and free returns and a global customer feedback system to quickly improve its existing clothing lines and part sales (multiple times through the year). Channels are apps, Zara has a robust digital presence online across various social media channels (Facebook, Twitter, Instagram, YouTube). Customer segments are 18-60 women and men, and Zara has different taste of fashion that makes it a number one choice for many people and has a different range of sizes available for the customer. Cost structure materials, design, manufacturing, employees, logistics. Revenues are retail and online sales.

The Business model of Zara consists of vertical integration and logistics trade-offs. These two strategies play a significant role in the success and global recognition. Vertical integrations help the company to control all its verticals such as design, manufacture, shipment, distribution, promotion, etc. Logistical trade-offs: Being vertically integrated can have a set of disadvantages. The company is always at a risk of losing factory space due to the advanced booking of the area by its competitors. Zara is known to manufacture mostly in Europe, which becomes a costly affair.

Zara in India: For India, Zara must follow a joint venture or franchise approach to enter the market because a joint venture or franchise is much less risky than direct investment. In addition, if Zara sets up a joint venture, they can partner with a company that knows about Indian culture compared to Zara. Because Indian culture is very different from Western culture (North America and Europe), Zara needs to have enough reliable knowledge of the market before it expands. Against this background, the use of the risk approach will significantly reduce the risk if they use another approach. Zara in India has developed a market segmentation strategy that focuses on demographics based on the age and gender of their customers (Hitesh, 2018). Market segmentation has allowed Zara to target the middle class in India, filling the market gap with preferred products that are fashionable clothing for middle class. Based on its future segmentation strategy, Zara aims to appeal to the middle class based on their fashion style and feelings. Based on Zara's market assessments, it presented Latin-style, grunge, classic, trendy, contemporary to meet the target market (Hitesh, 2018). These fashion varieties are now a blend of Indian nationality and various flavors and settings for middle aged customers in India. Zara's future strategy also considers job and market opportunities in the large young masses of India. Young people in India in 2018 make up 45.11% of the total population (Saraswat, 2018). Zara seeks to engage with these populations for work and the market for its products. These masses offer skilled and unskilled jobs to the fashion industry. Young people expect to bring new perspectives and different thinking to Indian culture, market, and fashion so that ideas are integrated into marketing strategies. Zara is also targeted at the Indian 17-40 age group (Saraswat, 2018), as they are very interested in buying fashionable clothes and high-end fashion products but cannot buy high-end fashion and shops in India. Given India's growing disposable income, young people will be a direct market for Zara's quality and trendy clothing.

The competition in the clothing retail industry is quite fierce. In India, Zara faces competition from other international brands fighting for the same market with fashion companies such as H&M, Mango (Kumar, 2018). Zara's anti-competitive strategy is based on a geographic strategy / positioning strategy. Zara aims to further expand its stores and outlets so that their clothing is easily accessible to the larger consumer, who chooses fashionable products at an affordable price. In addition, Zara's clothing design is the result of consumer feedback and reviews. So, Zara wants to constantly expand its brand to be more consumer-oriented in order to stand out from other competitors.

Zara's future Strategy in India

The track record of Zara in globalization has been enviable. The company's high-speed model has transited from Spain to over 76 markets globally, which includes China and now India. The organization has made entries in the most challenging markets internationally, but is model will be tested greatly in India primarily in three accounts middle-class fashion, youth market and labor, and competition. However, Pablo Isa the 47-year-old CEO states that the company has formulated business/marketing strategies aimed at successfully entering the Indian market (UK, 2016).

Firstly, Zara has established a market segmentation strategy in India that is focused on the demographics, in terms of their customers' age and gender. The market segmentation has enabled Zara to target the middle class of the Indian people plugging the market gap with desirable products, which are high fashion wear intended for middle-class women. The statement from detractors is that Zara has spent a fortune in research and working up those ideas. As per their future segmentation strategy, Zara aims to address the middle class based on their fashion style and sense. Based on Zara's market evaluations, it has launched Latino style, grunge, classic, trendy, contemporary to fit its target market. These fashion varieties have now a blend of Indian ethnicity and varied tastes and settings for Indian middle age customers.

Zara's future strategy also accounts for the labor and market opportunities in large young masses of India. The youth in India in 2018 account for 45.11% of the total population (Saraswat, 2018). Zara aims to tap into these populations for labor and also a market for their products. These masses offer both skilled and unskilled labor to the fashion industry. The youth hope to bring in a new perspective and different manner of thought into the India culture, market and fashion so that the ideas can be integrated into marketing strategies. Zara also targets the Indian 17- late 40 age group (Saraswat, 2018) since they are highly interested in the purchase of the trendy apparel and high-end fashion product but are incapable making purchases in the existing high-end couture and boutiques in India. Taking account of the increasing disposable income in India, the young people will be a direct market for Zara's quality and fashionable clothing.

Competition in the clothing retail industry is quite high. In India, Zara stands to face competition from other international brands who are fighting from the same market, with fashion companies such as Gucci, H&M, Mango (Kumar, 2018). Zara's strategy in addressing competition is a geograohic based / positioning strategy. Zara aims to continue expanding its stores and outlets to make their clothes easily accessible to a larger consumer-based who prefer trendy products at reasonable prices. Additionally, the clothing designs by Zara are a result of consumer feedback and reviews. Zara thus desires to continuously expand on being more of consumer-oriented brand so that it can stand out from the other competitors.

3. Problem framing

Main problem of Zara at first is literally its entry to India

So what was there solution for it?

Zara teamed up with the Tata Group, India, to form a joint enterprise in February 2009. To enter the market in India, Inditex (the company behind Zara) used the strategy of pursuing a joint venture with Trent Limited, a Tata Group company, a highly recognized clothing line distributor. Zara took up joint ventures as its mode of entry in India because this is a co-operative strategy in which the manufacturing facilities and know-how of the local company are combined with the expertise of the foreign firm in the market, especially in large, competitive markets where it is difficult to acquire property to set up retail outlets or where there are other kinds of obstacles that require co-operation with a local company to which Zara regards its stores as one of the related elements in its business sculpt. The shop is regarded as the boundary among the buyer and the motor of the whole business - mode design, development, logistics and finally retail.

But after entering Zara still got problem: Demography and cultural concerns.

So what did Zara do?

Zara pushed forward by selling a variety of its local clothing lines as well as international lines and still maintaining the brand ZARA. They also targeted the larger positions in the Indian Market of clothing lines. They started utilizing video advertisements print ads and the idea of e-marketing which fulfilled the varying needs of consumers from the India and beyond; particularly those priority Indian markets or the consumers in the urban India areas.

4. Solutions

If Zara plans to establish a strong and lasting customer base in India, they have to meticulously strategize in providing solutions to the above mentioned issues. Here are some suggestions for them to overcome this challenges:

• First, they must learn how to blend India's culture with their products. It is an effective way to capture the people's attention and encourage them to avail their product. By doing this, they are sending out a message that Zara is embracing cultural diversity and that they value the culture of the Indians by infusing it with Zara's fashion.
• Second, they could introduce a product line that contain the colors that are widely used and accepted in the Indian culture. The clothing company can produce specialized products with radiant and bright colors, only intended for Indian customers. This will entice the people to purchase their products, especially to those who still conform with traditional colors. With this, they can still sell their minimal-themed clothes along with the specialized, brightly-colored ones. It is like adding more options for the customers to choose from, thus resulting into more sales and profits.
• Third, Zara must find a way to cut production costs. India being a developing country imposes an imbalance in the economic status of the people. If they will continue with their high pricing, many citizens of India will not be able to afford their products. In order for them to solve this, Zara could launch a partnership with locals who can do labor and who could provide locally sourced materials. By doing so, they will be able to minimize cost, and they can sell their products at lower prices. If they will be successful with this, it is highly possible for them to attract not only those who belong in the higher class, but they can cater to customers up to the upper bracket of the lower class in the society.
• Fourth, Zara must produce clothing that would be appropriate for the climate in India. They must do thorough research which parts of the country would likely need to use thicker clothes (for cold climate), versus the breathable and light clothes (for humid, warm climate).
• Lastly, Zara must have an extensive production plan to avoid overproduction or shortage of stocks. They must closely monitor the turnover or goods so that they would know the approximate quantities to be produced. Again, it would be more efficient for the clothing company to source out materials in the locality, and avail the services of the people in the country. With this, efficiency in production will be increased since there will not be a need to import products from the other parts of the world. It can also help the Indians with employment. It is likely that when the locals find out that the products are manufactured by their own people, they would patronize it.

Zara's huge leap in choosing India as one of the many countries to build their legacy on is a bold choice. Knowing the gap and difference between Zara's fashion sense and India's traditional ways, it really is a make or break for the clothing giant. However, if the company embraces cultural diversity ad-nd inject bits of creativity to address and give value to the belief and culture of India, it will not be long before they can build and strengthen their clothing empire in the country. Heeding to the needs and wants of the people while still keeping their on-point branding will keep them, not just afloat, but thriving in the clothing industry, especially in the culture-rich nation of India.

One of the problems they might face is the people's conservativeness or traditional way of clothing. When you roam the streets of India, you would see most of the people wearing clothes that cover-up most of their skin, especially for women. This is due to the fact that they see it as a way to respect one's body. Another thing that might come as a challenge is the difference in the colors that the Indians prefer to wear than that of what Zara produces. Zara usually sells clothes that can be considered minimal in nature, with muted color tones to give a casual-stylish look. It would be a huge leap for them to overcome the Indians' choice of using radiant and bright colors with their choice of clothing. Pricing would also definitely become a vital factor for Zara. It is a common knowledge that India is still a developing country. This means that the majority would not be able to purchase their products if the pricing strategy will not match the income levels of the people. Lastly, one of the challenges that they might encounter is the speed of turnover and production of their products. This will require Zara to really think about production and sales strategies to avoid stocks being unsold for a long period of time.

Conclusion

References:

https://www.forbes.com/companies/zara/

https://www.statista.com/statistics/674434/number-of-zara-stores-worldwide-by-region/

https://www.livemint.com/companies/news/zara-tomes-continue-india-expansion-11591886047195.html

https://people.howstuffworks.com/culture-traditions/national-traditions/indian-tradition2.htm

https://www.memphistours.com/blog/how-to-dress-like-indian

https://www.forbes.com/sites/pamdanziger/2018/04/23/zaras-difference-pull-people-in-not-push-product-out/?sh=57f32c3f23cb