How Zara Took Over The Industry Using Fast Fashion



Zara is beating HM in fast fashion

ZaraZara rolls out limited stock to create demand. Business Insider/Jessica Tyler

  • is one of the few established brick-and-mortar apparel companies to be thriving in today's competitive fast-fashion climate. Its parent company, Inditex, reported a 7% increase in profits in 2019 and saw continued sales growth in its most recent quarter.
  • H&M, on the other hand, has struggled in recent months, with operating profit dropping 62% in the first quarter of 2019. In June, it reported flat sales growth for the second straight quarter.
  • According to a recent report by fashion forecaster WSGN, Zara's success in keeping up with online players such as ASOS and Boohoo comes down to its strategy for rolling out new items in lower quantities to create demand.

Zara has a unique strategy to compete with online fast-fashion players, and it proves that if done right, brick-and-mortar retail can still thrive.

The emergence of online players such as ASOS and Boohoo has meant that consumers have the choice of browsing thousands of new products online every day, putting immense pressure on brick-and-mortar stores to keep up.

Social media has created a generation of shoppers who are obsessed with newness.

"They want new and they want it now," Nivindya Sharma, director of retail strategy and insights at fashion forecaster WSGN, wrote in a recent report entitled "Fashion Retail: New Measures of Success."

Rather than jumping on the bandwagon and pilling up its stores with new items to keep up, Zara has created its own set of rules, and it seems to be working: it's now one of the few bright spots in brick-and-mortar apparel. Its parent company, Inditex, reported a 7% increase in profits in 2019 and saw continued sales growth in its most recent quarter.

Meanwhile, one of its main competitors, H&M, has struggled in recent months, with operating profit dropping 62% in the first quarter of 2019 and reporting its second straight quarter of flat sales growth earlier in June.

According to Sharma, Zara keeps up in the race by rolling out a limited amount of new stock at any one time to create demand.

"By bringing in regular but low volumes of products (compared to its peers), Zara not only maintains regular levels of newness but creates 'perceived scarcity,' thereby creating demand for its newness," Sharma wrote.

Zara also updates its store layout regularly to create a fresh experience for shoppers each time. This means you'll find window displays and mannequins switched around more often, even if the product assortment isn't necessarily changing.

Zara is known for its stylish editorial shots online.

On its online platform, it keeps customers excited with "beautifully shot" editorials and communicates news about new products regularly, which, in turn, "breeds desire and generates urgency among consumers to visit regularly," she said.

These tactics are what keep shoppers excited without the company having to drown itself in excessive amounts of new inventory.

H&M has fallen victim to this. Once hailed as the king of fast-fashion retail, the store's sales number have increasingly come under pressure as more nimble online players swoop in and poach customers. As a result, the retailer has been left in an inventory crisis with around billion of unsold clothes. This number includes new items on their way to stores as well as clearance items.

According to Sharma, Zara's most effective strategy comes down to its management of markdowns, which run at the opposite time of when it brings in new products.

"When Zara discounts heavily, it doesn't bring in huge volumes of new products; and when it brings in new products, it doesn't discount heavily — thereby creating a clear signaling pattern to consumers that ensures reactivity," she said.

"As Zara discounts only strategically and for limited periods, it maintains price integrity, thereby imbuing its new-ins with more value," she continued.

This, in turn, makes these items more desirable and more likely to be snatched up quickly by customers.






Video: Why I'm Boycotting H&M and ZARA | No More Fast Fashion

Zara is beating HM in fast fashion
Zara is beating HM in fast fashion images

2019 year
2019 year - Zara is beating HM in fast fashion pictures

Zara is beating HM in fast fashion recommendations
Zara is beating HM in fast fashion recommend photo

Zara is beating HM in fast fashion pics
Zara is beating HM in fast fashion pictures

Zara is beating HM in fast fashion Zara is beating HM in fast fashion new pics
Zara is beating HM in fast fashion new images

pics Zara is beating HM in fast fashion
picture Zara is beating HM in fast fashion

Watch Zara is beating HM in fast fashion video
Watch Zara is beating HM in fast fashion video

Communication on this topic: Zara is beating HM in fast fashion, zara-is-beating-hm-in-fast-fashion/
Communication on this topic: Zara is beating HM in fast fashion, zara-is-beating-hm-in-fast-fashion/ , zara-is-beating-hm-in-fast-fashion/

Related News


This is the optimum time to send in your CV when applying for a new job
Korean-Marinated Chicken with Noodles Recipe
70 Classic Men’s Hairstyles – Timeless High-Class Cuts
HOW TO WEAR THE BEST WINTER COATS THIS SEASON
People Are Swearing By This Hot Sex Milk
The Press Up And Plank Workout To Build a V-Shape In 60mins
10 Stylish Wavy Bob Hairstyles for Medium, Short Hair
Kidnapped Nigerian Schoolgirls Are Reportedly Seen For The First Time On This New Video
Diagnostic Tests for Gallbladder Disease
How to Make Galette Des Rois
Bachelorette Party Planning Checklist
How to Read a CT Scan
How to Distinguish Between Male and Female Fruit Flies
Living With COPD
How to Determine Your Dogs Age



Date: 12.12.2018, 19:42 / Views: 51173