1. Alptuğ İka
Selen Yeniçeri

2. Why We Are Here?
• Highlight what are the Strengths,
weaknesses, opportunities, threats of
Zara.
• Explain the target market and active
customers of Zara
• Focus on the potential customer’s Value
Proposition and the reasons why people
prefer Zara.
• Then, analyze of marketplace and
fashion industry and position of the Zara
among the industry by regarding
prominent competitors.
• Examines financial analysis of Zara and
whole industry.
• Determine the strategy the firm pursues
and develops.

3. Customer / Market
• Young people who want be
fashionable but at a low
cost.
• All price sensitive fashion-
enthusiasts!
• young professionals
• university students
• high school teenagers
• children.
• Big Cities
• Istanbul, Ankara, İzmir, etc.
• Target Market
• 4-40 age
• Mid-range income
• interested in fashion
trends
• located in big cities.

4. Customer’s Value
Proposition
Why customers use our and our competitors’
product ?
• Why do you think fashion has importance among people ?
• Basic needs
• External conditions.
• Self expression.
• Looking good.
• Self-confidence.
• Dress codes

5. Customer’s Value Proposition
• Fashionable, affordable clothes
• Fast-changing product variety
• Large choice of styles
• Scarcity
• Prime locations
Why our products over our competitors ?

6. Marketplace Analysis
General Economic Conditions
• Population 80 million
• GDP Growth 4,1%
• GDP per capita 10.971 dollar

7. Marketplace Analysis
Societal Values and Lifestyles
• Advanced communication technologies.
• Similar demands with Western societies.
• High brand consciousness.
• Like shopping

8. Marketplace Analysis
Legislation and Regulation
• Additional tariffs

9. Marketplace Analysis
Population Demographics
• Young population
• 0-14 (25.5%)
• 15-24 (16.8%)
• 25-54 (42.9%)
• Big cities
• Istanbul, Ankara, Izmir, Bursa, Adana
• Upper middle income
• Highest income group (46.6%) contribution
• Lowest income group (5.9%) contribution

10. Marketplace Analysis
Technology Infrastructure
• Improving technology
• High technology products create value
• Flexible production

11. Analysis-Industry

12. Driving Forces
• High population
• Shopping is a trend
• Fashion followers
• High income group
• Flexible production

13. Key Success Factors
• Utilizing shops actively.
• Brand image.
• High quantity production.
• Creating the value from product differentiation.

14. Porter’s Five Forces Model

15. •Rivalry
•Threat of New Entrants
•Supplier Power
•Threat of Substitute
•Buyer Power

16. Sales growth of Zara as follow so we can
say that now it is on the maturity stage
6.16% 13.39% 10.11%

17. ZARA H&M
• Smart casual style
• Branding style is
based customer
experience
• Prices/quality ratio is
high
• Better brand image
• Target market much
more narrow
• Practical life
• Quality lower than
Zara
• Designer
collaboration
• Price/quality ratio
low (is good)
• Sales growth higher
• Target market has
wide range

20. Strategic Group Map Of Turkey Textile Industry
GAP
ZARA Tommy
Hilfiger
H&M
Benetton
Lc Waikiki
P
R
I
C
E
QUALITY

21. Financial Analysis
2014 2015 2016
Net Sales
Turkish liras
11084 12527 13793
COGS
Turkish Liras
4756 5105 5612
Gross Profit
Turkish Liras
6328 7422 8180
Net profit
Turkish Liras
1322 1741 1946

22. year 2014 2015 2016
ratio
Sales Growth 6.16% 13.39% 10.11%
profitability growth 4.75% 31.69% 11.77%
Assets Growth 6.87% 7.17% 17.88%
Debt Growth -81.99% -83.81% -82.50%
Financial Analysis

23. SWOT

24. Strength
High Turnover of product
Ability to recreate of fashion
Active use of stores

25. Weakness
Middle Priced Goods
Low quality
Limitations on Services

26. Opportunities
Global Fashion Product
Growth of fashion market
Diverse cultural area

27. Threats
Emerging New Comers
Limitation of Design Copies

28. Generic Strategies
• Cost Leadership Strategy
The company has to decrease their cost, and to achieve cost advantage below its
competitors in the market. By doing this, a company is able to lower prices and performs
above the average performer in its industry thanks to the fact that the cost for the company
will be less than its rivals.
• Differentiation Strategy
Customers look at the attributes of the products other than looking at the price. To apply
this strategy, the firm has to differentiate itself in terms of its products for instance by focusing
on the quality of the products or in terms of provided service by focusing on the delivery
system by means of decreasing the lead or delivery time.
• Cost Focus Strategy
This strategy has two variants which are differentiation focus and cost focus.
Differentiation focus aims at differentiating a segment or a group by satisfy their unusual
needs and the in Cost focus, the firm seeks to achieve low-cost advantage in order to
provide the products at cheap prices and the concentration is made only for a small
number of the market segments. However, the risk of these strategies is that competitors
can easily recognise the success and may copy them

29. Environmental Factors
Organic food products have become popular, it is inevitable that consumers will extend their scope of purchase to
the organic textiles and this trend is already started as some retailers such as Marks and Spencer introduced range of
clothes made with organic cotton. As a result of the pressure on environmental issues, Zara implemented a framework
called the Environmental Management System which is the pursuant to ISO 14001 standards. This is a good
opportunity for Zara because the company can now position itself as a socially responsible for environment. In
addition, emerging trend for organic cotton can be an opportunity for Zara to strength its image and help the company
to attract customers who prefer made with organic materials.
Social Factors
The social factors are one of the most important factors which affect the fashion industry. Culture of the society is
viewed as the most significant factor in terms of its effects in fashion since it is different from one country to another,
even it might be different in the same country. Moreover, culture changes as time passes and these changes affect
preferences in fashion. As a result, predicting changes become difficult since taste of consumes can be influenced by
several factors, such as weather, movies, or even footballers or pop stars.The impact of this would be a threat for Zara
if they company cannot be able to adapt themselves with ever-changing nature of tastes.
Threat of Entry
Threat of entry indicates the entry barriers to an industry. Since there is several numbers of clothing companies in
the Turkey, it is a highly competitive market. This makes difficult for the new entrants to compete in this market as
there are some barriers to enter and compete in the market. One of the barriers is the need for large sum of financial
resource to compete in the market as entering requires building both tangible and intangible assets which can be
achieved by investing in advertising, customer service to build a customer loyalty as well as investing in physical
facilities for stock holding and distribution.

30. Strategic Map
Improve new
products each
year by regarding
changing fashion
trends
Select qualified
Factories for production
and regularly control
them
Developing new
fabrics via
cooparation of
suppliers
Mass
produce
targeted
items by
imroving
their quality
Spread value
added
information
through
marketing
channels
Focus on potential customers
and giving quick response to
their changing needs
Work with the fashion
professionals a introduce
advanced technologies
Expand pr
activities by
using TV,
newspaper,
social media
Providing strong employee
motivation

31. Possible Implementations
• Cross functional business intelligence department could be
establish to give quick response for external changes.
• Collaborative network with a local firm could be conducted.
• Invest in R&D department for different type of organics cotton,
especially for long stable superior types.
• Find vocal people of influence who are within your target
market who can be brand ambassadors for your company.
• Host or be sponsor for an local Interactive Fashion Show