Improving ZARA’s Digital Marketing Strategy: Situation Analysis And Recommendations

Situation Analysis

Question:

Discuss about the Social media in alternative marketing communication.

Al-Jabri and Sohail (2012) depicted that due to the presence of digital marketing, not only the large business but small business also get the advantage to reach a wider audience at a very low cost. Another advantage of digital marketing is that it helps generating higher sales through delivering conversion. This medium also allows effective and direct intercalation with the target audiences and it also caters the mobile consumers. However, Armstrong et al. (2015) argued that not all companies are able to utilize the digital marketing effectively and often suffers loss. The company that is taken into consideration is ZARA, which is one of the know fashion brands but still struggles to attract more customers due to improper use of digital marketing. There are several digital media through which the customers can be targeted like Facebook, Twitter, Instagram, Pinterest and Youtube. ZARA on the other hand is available in all these digital media but still this organization failed to attracts their customers through other digital media apart from Facebook and Instragram (Statista 2018). There are total of 25,233,087 followers in Faacebook; while there are 15,731,099 followers in Instagram (Statista 2018).

This business report highlighted the situation analysis of the ZARA that shows that they need improvement in the digital marketing plan, SMART objectives, identification of target audience and positioning, appropriate recommendations for action followed with 12-months digital marketing plan. The business report will also illustrate the metrics to evaluate success of recommended tactics.

Kajanus et al. (2012) stated that in order to identify the internal stretch and weakness along with identification of the threats and utilization of opportunity. Thus, in this section, SWOT analysis is used for evaluating the current scenario of the concerned organization.

Strengths- Zara has a total of 2000 stores across the world and is one of the biggest Spanish retailers. The supply chain process is economic friendly since their operations are integrated. (Keller 2012) also highlighted that they only manufacture apparels once they get order and hence there is low wastage of inventory. They have fashion detective all over the world and this is the reason that they pick the trendiest apparel in their store and attract customers through their stores. Hammoudeh (2014) also stated that they also target customers through their accessories like handbags and shoes.

Weakness- The advertising strategy is poor. This limited marketing and advertising approach is the reason that they do not target customers from territories where there outlets are not present. Mertens (2015) highlight that due to less advertisement strategy; their initiative to open their brand in Argentina fails.

SWOT Analysis

Threat- ZARA has many allegations for their brand’s products like they produce copied fashion apparel and some of their apparel violates some traditional beliefs. Moon et al. (2013) states that economic downturn among the target segment is also a threat for the concerned organization. Due to the effective brand awareness of other fashion brands, a large percentage of customers get switched over those brands.

Opportunity- ZARA has the opportunity to research more on fashion trends so that they can create some signature apparels. Otherwise they have the opportunity to develop their digital marketing strategy. ZARA usually invest a portion of their annual revenue in store promotion and not on the advertisement. They thus have the opportunity to spend more on advertising their apparels, developing the content of the advertisement and formulate different products according to flexible income level so that more audiences can be targeted.

Factors of S.M.A.R.T. Objectives	Description of the factors
Specific	The development in the digital marketing will be able to get 30,000 new customer at the end of the 1 year plan
Measurable	The digital meeting plan will be developed in the first month and it is successfully implemented in the next two months. Moreover, per month the goal is to attain minimum of $50,000 profit trough online business and 30,000 more followers through different social media sites..
Attainable	In the first month, the other digital media like Pinterest, Twitter and Weido will be improved for attracting more people. Investment will be made for developing the advertising strategies.
Relevant	The effective advertisement strategy will able to make more customers knowledgeable regarding their products and initiative that they are taking for the customer. This goal will surely able to obtain more profitability.
Timely	The digital marketing plan will be implemented successfully by the third month and the company will have more 10,000 orders that is to be delivered within next two months.

Table: S.M.A.R.T. Goal for digital marketing plan

(Source: Created by Author)

Segmentation- Market segmentation can be done through demographic and geographic. In case of ZARA digital marketing plan, the segmentation for demographics is comprises of age, marital status, education, occupation, ethnicity, or sexuality. The plan is developed so as to attract people mainly of 18- 35 years of age. Since, fashion is like by boys and girls equally, the plan also targets both the male and female customers equally. The high-income people are mainly targeted through the digital plan of ZARA. The internet platform is available across the world and hence cannot be separated by country, region or state.

Targeting- ZARA mainly deals with fashion apparels and accessories that is hugely liked by millennial that is from 18- 35 years old people. The digital platform contains all the details of the new fashion trends, ramp shows and sale in their stores. In this way, more people show their interest to purchase their products.

Brand positioning- ZARA has a sound positioning in Facebook and Instagram. However, this plan also targets other digital platform like YouTube, Google+, Pinterest and Weido. This digital plan also hosts a picture competition on Instagram so as to attract more people for attractive discount in their store shopping through their channels.

Integrated communication strategy- Thorson and Moore (2013) stated that integrated communication strategy considers customer database, strategies, tactics, evaluation of the results and measurements. The communication strategies comprises of the following aspects-

Factors for communication	Details of the factors
Target audience for communication	The target audience for communication is the millennial that are from college students to young professionals. These people need regular updates regarding the recent fashion trends and new designs that they can experience.
Content for communication	· Details regarding new fashion apparels and design · Their research on different fashion trends · The discounts that customer can get from purchasing online · The other facility that they get by using digital medium for purchasing items. · The ramp shows and store promotions that is going to occur · The CSR activity and green initiative in their new bulletins
Selected channels for communication	All kind og digital media is targeted. Initiatives for enhancing the performances of YouTube will also be taken into consideration. Moreover, the content of their website should also be improved.
Positive and negative aspects	Positive: · People from distant place can experience ZARA’s apparel · Brand promotion of thee ZARA through the most adopted media that is digital platform Negative: · New partnership will be formulated for shipping the ordered to the destined place · Separate legislation for maintaining digital presence should be followed in different nations.

Table 1: Integrated communication strategy

(Source: Created by Author)

SMART Objectives

Social media marketing- A customized digital platform is designed in every marketing tool like Facebook, YouTube, Twitter, Google+, Pinterest and others to engage 40% of fans. In this way, registration for upcoming events can be promoted along with the details of upcoming photo and video contests, contest essays. These systems should also feature customer’s reviews, interview with leading fashion experts and case studies on the achievements of ZARA.

E-mail marketing- This tactic is used to acknowledge more people personally for getting 19% increase in sales. Salehi et al. (2012) stated that people also like personalizes e-mails as they can see the research that the organization has made on them along with the buyer persona to deliver relevant information and hence it can bring relevant results. The popularity of the effective digital marketing plan can be seen by the increasing rate of e-mail sign-up rates. The e-mail list segmentation results in increased open rates, lower unsubscribe rates, better deliverability, and greater customer acquisitions and improve word-of-mouth promotions (See Appendix, Fig-1).

Marketing Automation- Email marketing can be automated by triggering the behavioral aspects. This is comprises of behaviors like what kind of material a user saved their on their cart, how many people subscribe new and many have enrolled for “let me know, when the item is available”. These are the tactics through which the customers are targeted more effectively and the sense of customization is attained effectively. The automation also collected data from the customers to get better idea about their choice and likeness. ZARA’s marketing automation system also develop unique and transparent system of collecting customer data regarding their height, fitting size, type of style for both apparel and shoes (See Appendix, Fig-2). The market automation also target people based on their Google search by a person concerning ZARA, select potential customers from the faceook fanpage through their active comments and regular posting of images, targeting customers, based on the type of products they choose and repeatedly buy from the sites and target individual, who responds to e-mail programs.

Affiliate Marketing- ZARA also plan to do affiliated marketing through which they pays commission to external website for creating internet traffic in their site. This tactic targets to attain extra $45,000 monthly profit by attracting more people. According to this tactic ZARA will give additional of 30% off on their second day’s purchase. ZARA will also give ZARA gift coupons for making purchase on their next orders and it is targeted to generate product order increase by 9.8%. In this way, it can obtain its goal to enhance the overall profitability of their organization.

Segmentation, Targeting, and Brand Positioning Strategies

App development- Persaud and Azhar (2012) stated that another way to gather data from the customers is to develop mobile applications. Mobiles are considered as the powerful sensor platforms and are used majorly used by the mobile commerce vendors and digital marketers. ZARA will also develop mobile applications through which they can search their desired products by applying filters to their orders. This will help ZARA to formulate a customized mobile application through which they can get online every time. Customer will get updated news regarding the new offers, recent trendy apparels and the available discounts.

Video production- This tactic is use to improve the fan following of the YouTube platform. ZARA plan to shoot their apparel production and their ways to taken to improve the customer loyalty. The strategy is to be consistent and upload at least three videos per week. The content of the video should be optimized and deliver a valuable message. The video should also accept the customer’s comments and the management also hire some staffs to respond on those comments as fast as possible. ZARA will also use cookies to identify what kind of video a customer prefer and search frequently in the YouTube. In this way, related videos can be suggested for the customers and effective images can be get from the customer.

Selected Action & Control	Actions that is taken to accomplish the goals	Benefits gets from the actions taken	Time-frame
Social media marketing (1^st -3^rd month)	Incorporation of registration for upcoming events	The number of customers enrolled for the contests can be increased and easily evaluated. The number of videos and picture uploads also enhances the popularity of the digital platform for ZARA.	1^st– 2^nd month
Design the process to identify the number of customers enrolled, number of likes obtained, number of subscribers for upcoming photo and video contests and contest essays, once the details has been published	This will help ZARA to measure the performance of the digital media	2^nd– 3^rd Month
Marketing Automation (2^nd – 5^th Month)	To identify the buying behavior of the people	In this way, it is easier to find what kinds of products are more preferable by the customers and ZARA can start focusing on those products more.	2^nd to 3^rd Month
Ask for their preferred style for purchasing their fashion apparel	This will help ZARA to customized the digital platform and people will intend to shop from their sites as they can visualize the in-depth research from the organization	4^th– 5^th Month
App development (6th- 9th Month)	Development of mobile application starting from planning of the platform adaptability and options that is seen by the people for searching their products.	This will develop the customization of the digital platform through which customers data collection can be done easily.	6^th– 8^th Month
Ability to perform filter to search for their preferred products	This will also help customer to find their product in lesser time, which also enhances the performance of the digital presence	7^th-8^th Month
Provide regular updates of the application so that customer can view all the changes that is incorporated	New technology can be timely incorporated and provide ZARA competitive advantage	7^th-9^th Month
Video production (8th – 10th Month)	Upload at least three videos per week, develop optimized content of the video, ZARA also plan to deliver a valuable message, accept the customer’s comments	This will result in increase in subscribers in YouTube and also results in more customer engagement. This will increase the internet traffic in their YouTube channel.	8^th– 10^th month in weekly basis
Using cookies to identify what kind of video a customer prefer and suggest related videos for the customers	This will help ZARA to optimize their digital performance by personalizing the digital platform for an individual.	9^th– 10^th Month
Overcome ad frauds (10^th – 12^th Month)	Identify the fraudulent advertising organization and block those sites from their sites.	Provides safety to the digital platform	10^th-12^th Month
To implement optimized funnel that includes items on which fraud can be done, context research, increase viability and performance (See Appendix, Fig- 3).
Developing on-site analytics that identifies short session durations and high bounce rates.	Improve the searching experience of the customers	10^th-11^th Month
Check on regularly IP addresses of the ads’ clickers	This will results in safe digital media platform.	11^th– 12^th Month
Hiring of new staffs (3^rd– 6^th Month)	Generate job opening for handling the digital marketing operations	This will help ZARA with some staffs that are experts in digital marketing and they can regularly assess the development of the digital advertisement and respective customer response.	3^rd -4^th Month
Formulate a department for digital marketing and focusing more on advertising their products and facilities a customer can get through purchasing their products.	Close analysis of the digital marketing performance Well identification of the aspects that can improve the digital presence for attracting new customers	4^th to 6^th month
Quick response to the user’s questions	This will increase the customer satisfaction	3^rd– 6^th Month
Staff training (4^th month- 8^th Month)	Select potential staffs from existing employee	Staffs will get the opportunity to perform challenging roles that enhances the employee satisfaction	4^th month
Identify the recent digital marketing trends	This will help ZARA to attain competitive advantage	4^th– 5^th month
Conduct training session from digital marketing experts	This will enhance the knowledge base of the employees	5^th– 7^th month
Regular assessment of the staffs	This will help manager to evaluate the staff’s performance and how well they can take initiatives for attracting more people	5^th– 8^th month
Developing partnership with external suppliers (4th- 8th Month)	Identify the most potential and effective supplier in every nation where ZARA want to do business	In this way, ZARA can adapt more profitability and gain more customer base through their online platform.	4^th Month
Adopt all the governing legislations of those nations and development of business rules in collaboration with government	This will lower the risk of legal issues and frequent changes in the business legislations	4^th– 6^th Month
Develop partnership with these supplier for delivering the ordered products to the destined places	This way, users can order ZARA’s products through online sites and get it delivered to their preferable location. This will also results in high customer base and effective brand recognition.	6^th – 9^th Month

Table 2: Action & Control for implementing the plan

(Source: Created by Author)

Conclusion

Thus, it can be sated that ZARA being one of the most re-known brands have a poor advertising strategy. They invest a proportion of their annual revenue in store promotion but not in fashion shows and advertising their products to the customers. This business report identifies some of strategies through which the concerned organization can improve their advertising Strategy and people can get more knowledge regarding their profits and the trends that they have developed for the people. It is also identified from this business report that ZARA should develop the approaches they use in social media marketing like post details of the upcoming photo and video contests, ramp shows and brand promotions. ZARA should also look after their marketing automation through identifying the preferable items that their potential customers and existing customer are looking through their websites. They can also use cookies to identify these details. The organization can also adapt App development, where they can provide their customer the privilege to go through their website and make purchase through their mobile device. Moreover it is also identified that in order to improve their YouTube subscribers and internet traffic they can also focus on video production and uploads at least three videos per week and develops effective and optimized content. They also plan for hiring of new staffs for handling the digital marketing operation and develop partnership with external suppliers so that the business can be expanded in other nations.

Integrated Communication Strategy

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