The comparative analysis of the marketing strategies implemented by Zara and its competitor H&M allows indicating the existing deficits in the current marketing plan and providing the recommendations for the necessary improvements if any.
Zara as a subsidiary of a parent company The Inditex Group was founded by Ortega Gaone, one of the richest men in Spain in 1975 (“Zara France – Clothing and Footwear – France”). First, Zara stores specialized in low priced popular clothes for women, men and children, focusing on wider audiences instead of individuals (“History of Zara”).
The cheap prices and reputation of a fashionable brand are the main characteristics which allow Zara to preserve its competitive advantage nowadays (Ghemawat, and Nueno “Zara: Fast Fashion”). The company H&M was established in 1947 when the companies Hennes when its owner Persson bought a sportswear inventory shop Mauritz Widforss (“H&M Company”).
The name of the new shop was changed into Hennes and Mauritz (H&M) (“Hennes & Mauritz AB”). Since then, the good prices and design have been the main advantages offered by H& M to its customers (“H&M Company”).
Currently, the main challenges faced by Zara include the international expansion and intense competition in the market sector (Craig, Jones, and Nieto. “Zara: Fashion Follower, Industry Leader”). H&M faces the threats of declining confidence of their customers and intense competition in the sphere (Hansegard “Interview: H & M CEO Views UK Market with Continued Optimism”).
Along with expanding to new and existing markets, the company makes attempts to establish a recognizable brand name (Kingsbury “H & M Sets up a Shop in China”).
The current marketing strategy used by Zara includes developing loyalty programs for the purpose of establishing the relationships with customers and increasing the number of visitors. Concentrating on the so-called Euro-chic, Zara prefers to produce less, but find the most appropriate retail site (Capell “Zara Thrives by Breaking All the Rules”).
In 2009, only 0.3 % of sales were spent on advertizing of products and attracting new customers (Dutta “Retail and the Speed of Fashion”). H&M, on the contrary gives serious consideration to the marketing strategies (Capell, and Khermouch “HIP H&M”).
H&M have launched a number of mobile advertizing campaigns, sending SMS to their potential customers since 2006 (Butcher “Retail Giant H&M Runs Multifaceted Mobile Marketing Campaign”).
Additionally, H&M places its ads and banners on the most popular portals and media sites. Going even further, H&M invited celebrities, including Roberto Cavalli, Jimmy Choo and Karl Lagerfeld for the purpose of gaining more customer traffic and increasing sales.
Social campaigns of participating in the HIV/AIDS prevention projects (about 25% of sales from particular collections were donated to the projects) also contributed to positive branding of H&M and increasing its popularity (Baker “H & M Launches Ethical Fashion Brand”).
The main recommendation for improving the marketing strategies used by Zara is to pay more attention to attracting the customers’ traffic by using the available means of innovative marketing, including those of online and mobile campaigns.
Regardless of the fact that Zara takes one of the leading roles in its market sector, measures need to be imposed for preserving its competitive advantage (Craig, Jones, and Nieto “Zara: Fashion Follower, Industry Leader”). The recommendations for H&M include further expansion to new markets, continuing mobile and internet marketing campaigns and positive branding of the company for establishing a recognizable and positive brand.
Works Cited
Baker, Rosie. “H & M Launches Ethical Fashion Brand”. MarketingWeek 15 April, 2011. Web..
Butcher, Dan. “Retail Giant H&M Runs Multifaceted Mobile Marketing Campaign”. Mobile Marketer, 23 January, 2009. Web.
Capell, Kerry, and Gerry Khermouch. “HIP H&M”. BusinessWeek, 11 November, 2002. Web.
Capell, Kerry. “Zara Thrives By Breaking All the Rules”. BusinessWeek, 09 October, 2008. Web.
Craig, Amanda, Charles, Jones, and Martha Nieto. “Zara: Fashion Follower, Industry Leader”. Business of Fashion Case Study Competition. Philadelphia University 2 April, 2004. Web..
Dutta, Devangshu. “Retail and the Speed of Fashion”. Third Eyesight Database 2002. Web..
Ghemawat, Pankaj, and Jose Luis Nueno. “Zara: Fast Fashion”. Harvard Business School, 21 Dec. 2006. Web..
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Hansegard, Jens. “Interview: H & M CEO Views UK Market with Continued Optimism”. The Wall Street Journal 29 Sept., 2011. Web.
“Hennes & Mauritz AB”. International Directory of Company Histories n.d. Web..
“History of Zara”. Zara-Clothing, 2008. Web..
Kingsbury, Kathleen. “H & M Sets up a Shop in China”. Time Business Magazine 03 May, 2007. Web..
“Zara France – Clothing and Footwear – France”. Euromonitor International, 2009. Web.