Professional Documents
Culture Documents
000 - Zara and Spanish Fashion in The Chinese Market
000 - Zara and Spanish Fashion in The Chinese Market
China
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Tutor: Hurlum Heisah
Group members:
P1301x434
P1401049x
P14010x03
P140101x7
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Table of Contents
Introduction ......................................................................................................... 4
Conclusion .......................................................................................................... 10
References .......................................................................................................... 11
Bibliographies ..................................................................................................... 12
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Introduction
Chinese fashion culture has formed and developed only over the past 20 to 30 years.
With the steady growth of the Chinese economy, Chinese consumers' purchasing
ability keeps increasing, while the vast consumption potential will offer a great
opportunity for the people who engaged in China's fashion industry. This report
intends to examine the marketing of Zara fashion wear in China. It will include
analysis of the product, the pricing policy, the distribution channel and the product
with the details of segmentation. There are many famous and popular brands of
fashion wear in China, meanwhile, Zara faces a super market with strength
Zara is a Spanish chain store owned by Inditex Group, which was founded by
Amancio Ortega in 1975. So far, Zara runs about 1390 stores in 74 countries. Zara
designs and produces clothes, shoes and accessories for women, men and children.
Zara concentrates on excellent designs and lower prices, which catches the young
people’s eyes in the apparel market. Young people love Zara very much because
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Chinese markets for fashion wear
‘Now China is not only the biggest producer and exporter of textiles and clothing,
according for 50 per cent of world’s total fibre production and 58 per cent of world
texiles and clothing trade in 2009, but also a potential buyer and importer, backed by
a fast-growing market’ (International Trade Centre, 2011: 1). In 2008, the financial
crisis lead to world trade textiles clothing dropped sharply, the Chinese market was
(2011) has pointed out that, “China’s per capita fibre consumption increased from 4.1
kg in 2000 to 20.3 kg in 2008”. (p.1) Restoring the economy will accordingly enlarge
the market and provide more opportunities to the industry in the future. According to
the National Bureau of Statistics of China (NBS), the total apparel sales grew by 24.2
With a population of 1.4 billion and a rapid rising economic trend, China offers a
lucrative business opprtunity for the rest of the world. Due to the appreciation of the
RMB, which will bring huge changes in Chinese people’s lives style. In 2013 Chinese
the same time, this also means that Chinese consumers will have more stronger
people, especially between the ages of 25 to 35, pay more attentions to fashion
wear. The key for the success of Zara is the fast fashion. Currently, Chinese apparel
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market is moving towards the direction of fast fashion, which is in line with the
development direction of Zara. This offered Zara a very favorable condition for
China is the third largest country with an area of 9.6 million square kilometers, over
1.4 billion population that is more than any other country in the world. Based on its
distinct political and economic development, China has been divided into different
level cities. For example, the so called first-tier cities include Beijing, Shanghai,
Guangzhou and Shenzhen, second-tier cities has more than thirty and those cities
also have a good economic base with a large quantity of population. A data of China
National Bureau of Statistics (NBS) indicates that the first-tier cities have a massive
population with over CNY 60,000 of average annual income. Zara as a Spanish
clothing retailer should focus its consumer markets on the first-tier cities, due to the
high population density, a large number of middle-class and income level much
higher than the national average. Zara as a Spanish clothing retailer, suits the
China’s GDP was CNY 63.65 trillion or USD 10.36 trillion. GDP per capita reached
46,652 Chinese Yuan, with a percentage of 9.9 increases over the previous year.
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The rapid economic growth of China would represent plenty of opportunities for
foreign corporations (e.g. Zara) to expand the potential consumer markets. China as
a developing country could be segmented into three different consumer groups. That
is a small number of newly rich, a growing middle-class and a large number of poor.
China is the second largest luxury market in the world. The luxury consumption is
rising sharply among the rich people in China. In addition, Chinese middle-class with
higher education and good income is growing rapidly. Purchasing quality products
and foreign brands is becoming a growing trend. As a result, the Chinese middle-
Group China Fashion Research Survey, the younger generation tends to spend more
on fashion wear than other generations, fashion conscious and foreign brands are
spend most on clothing, Zara as a Spanish brand is widely accepted by this age
wear than male consumers. In China, population of female is over 650 million, which
provides the largest consumer markets for Zara women’s wear. Moreover, the
demands for women’s wear have continued to increase as the number of Chinese
career women has risen. However, China with a male population of nearly 690
million, Chinese male consumers is still a huge potential market for Zara men’s wear.
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Competitive advantages
vacation travel and so on. They are spending less money on clothes. Moreover, they
are selecting the latest fashionable clothes but they want it in less price. Thus, to
gain the market and attract the customer, Zara is the only brand who produces the
important role in the society because people always want to look good and wear
something fashionable that is very important for them. People are always finding the
way that they can become the first one representing the latest fashion. Zara also
wants its customers to look different from others. Therefore, Zara provides the best
and most fashionable clothing to its customers with high quality and low price. Zara
Zara and no advertising cost. In a short amount of time Zara is able to distribute and
produce new style of fashion for their customers. According to research, Zara’s most
powerful competitive advantage is that they are newest design. However, Zara’s
marketing focuses on young people’s wears, so they offer latest fashion to their
young customer in less than two weeks due to their good distribution strategy and
fast production, which is 12 times faster than their competitors. It allows them to
attract the customer from the market. The next big advantage is that Zara provides
their distribution center closer to their retailers so they can reach the Zara’s retail
stores in less time. This advantage makes people have to buy the latest clothing in
time. Another big advantage is that Zara creates clients prospective by their
segmentation on different characteristics such as lifestyle and age. Zara sells three
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different kinds of items, for children, men and women. Zara aims to cover young
consumers, and want to provide them best latest fashionable clothes in fewer prices.
The advertising cost of Zara products is significantly less than other company’s
products. The popularity of Zara’s products is magnificent. Moreover, Zara focus and
produces superstar inspired clothes. Zara attracts their customers in many ways.
They provide their customers best up to date and modern fashions. Mostly, Zara
having their distribution center out of Europe. Therefore the waiting time is almost
two weeks but in China is around two months. International brand are taking three to
four months. This means that Zara warehousing costs nearly 60 percent less than
other clothing. Zara has a following of more than six million dollars on fashion brand.
Young people like to follow fashion but fashion styles change very fast. Zara defines
its own unique selling proposition (USP) as its resolve and ability to react
products in its own stores. Products remain on the shelves for no longer than four
weeks, and if a product or line does not sell fast enough, it is rapidly discontinued.
This imposes pressure on fashion conscious customers to buy new products to keep
up with the designs in the stores before they go out of fashion. According to the
research, Zara has more than 200 professional young designers from different ethnic
groups with 20 countries, and their average age is about 25 years old. They are
closely following the pace of fashion. Designers always work with passion to catch
the fashion styles so that the young people pretty faithful Zara. The artistic directors
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lead the designers to follow fashion, the artistic directors in charge of decision-
styles, finally, and combining into a new clothing series. They are always shuttling
between fashion shows in Paris, Milan, New York, Tokyo and other fashion cities. So
that they could launch the simulation fashion items as soon as possible. Zara
merchandise spends on average three weeks from design to shop sales, the fastest
Through this strategic, once the most fashion styles appear in anywhere in the world,
which can be produced within five days by Zara, at the same time, it will be off Zara’s
sale shelf in five days when the same fashion style come out in the market. Zara try
to make sure that put all the similar products off Zara’s sale shelf. Therefore, to
competitors, the “copy master” Zara has the latest style with reasonable prices. For
the competition of Chinese retailer, it is still great. Zara’s character is always at the
forefront of the fashion trend. The targets of consumers are these who wear women’s
fashion clothes. The requirement for quality is low. The USP of Zara is a big
Conclusion
In short, China is a developing country with such a large number of people. However,
there are many first-tier cities and second-tier cities with a good economic base and
Chinese young people more and more pursue fashion. Meanwhile, China is a big
market for fashion industry. With this situation, consequently, the profit will be very
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impressive so that many companies want to have a market share in China. Zara has
its own unique characteristics and it has developed very well in the past few years in
China. According to above, Zara has steady progress and achieved remarkable
results. With China’s booming economy, thus, fashion will increasingly play an
important role in the future, especially for young people. They are getting intense
pursuit of fashion clothes, but fashion changes fast. Zara is a leader of fashion and
with a low price, it make young people can easily follow fashion in time. Anyway, It
has a good position in China. As the great potential, it leads to strength competition.
Any company wants a further development and more opportunities must have
outstanding sides. Zara, in order to stand out from others, has its own unique selling
proposition (USP). This is a big advantage for competition in the market. It is the
trend consistent with Chinese fashion standards. Therefore, the USP of Zara is a
very important element for defeating others in the fashion world in the future. Zara,
hopefully, will develop better in China and the young people around 25 to 35 years
References
‘Number of stores of fast fashion specialty retailer ZARA in China from 2010 to 2012’.
http://www.statista.com/statistics/289368/china-zara-store-number/ [Accessed
08/04/15].
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International Trade Centre, (2012), The Chinese Market for Clothing, [Online]
http://www.intracen.org/uploadedFiles/intracenorg/Content/Exporters/Sectors/Food_a
nd_agri_business/Cotton/AssetPDF/China%20final%20technical%20document%20f
Strother and Stuart, C. (2014) The Consumer Market in New China, Journal of
updated 20/02/15.
Bibliographies
[Accessed 08/04/15]
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‘English business report’, 2011, Available from:
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