Global Marketing
Assignment-2
Comparative study of brands
Submitted by
Lucky
Saloni Tak
Sapna Yadav
Under the supervision of
Dr.Priti Gadhavi
In partial fulfilment of the postgraduate degree “Master of Fashion
Management (MFM).”
Submitted to
Department of Fashion Management Studies (FMS)
National Institute of Fashion Technology (NIFT)
1
Table of Contents
Sr. No Topics Page No
1 Introduction to the brands
2 STPs Comparison
3 4Ps comparison
4 Zara’s entry into India
5 H&M’s entry into India
6 SWOT analysis of Zara
7 SWOT analysis of H&M
8 Suggestions for better penetration in India (Zara)
9 Suggestions for better penetration in India (H&M)
10 Conclusion
References
1. Introduction to the brands:
Zara H&M
2
Zara is a Spanish fast-fashion brand. H&M is a Swedish fast-fashion brand.
Founded in 1975 by Ortega and Rosalia Founded in 1947 by Erling Persson.
Mera.
Caters to men's, women's, and kids’ fashion. Caters to men's, women's, and kids’ fashion.
Especially young women.
Headquarters in Arteixo, Spain. Headquarters in Stockholm, Sweden.
USP: Offers high end, chic clothing at a USP: Offers chic, stylish clothes along with
premium price. a classic look at affordable prices.
2270 stores worldwide. 5000 stores worldwide.
1.2% share in the global apparel market. 1.6% share in the global apparel market.
2. STPs Comparison
Zara H&M
3
Segmentation Segmentation
● Demographic: women, men, and ● Men, women, and children between
children between the age group of 8- 8 to 45 years of age.
45 belonging to the middle-income ● Major focus on the women segment.
group. ● Middle-class income group.
● Psychographic: People interested in ● Stores in highly populated areas with
the latest styles and trends in fashion. more footfalls.
● Geographical: high profile areas with
a high population and more footfalls.
Target market Target market
● People with medium to high ● highly fashionable and trendy
purchasing power who love to look people.
glamorous at all times and enjoy ● young people are the major targets,
exclusive shopping experience. especially women.
Positioning Positioning
● Zara follows democratize fashion. ● Position itself as a brand providing
● A low-cost high fashion brand. highly fashionable latest trend
● More fashionable as compared to clothes at the lowest prices.
competitors. ● A well-known fast fashion brand.
● Opens stores at high profile
locations.
4
3. 4Ps Comparison
Zara H&M
Product Product
● Offers fashion clothing and ● Large product mix width.
accessories for men, women, and ● Major categories include men's wear,
children. women's wear, and kid's wear.
● Launches 10,000 new designs in a ● Numerous sub-brands like H&M, &
year. Other Stories, Cheap Monday, COS,
● Products are hit among the etc.
fashionistas as well as the masses.
Price Price
● Highly fashionable products at low ● Offers high-quality products at
prices. premium prices.
● Low pricing strategy focusing on ● Lower prices due to low
value for exchange. transportation and manufacturing
● Spends less on advertisements and costs.
raw material. ● Also offers various discounts and
● Country specific prices. schemes on their core and fresh
stocks.
● Pile it high, sell it cheap method.
5
Place Place
● Enormous reach with 2270 stores all ● Stores are located in well-known
around the world. locations.
● Also sells through online stores. ● Exclusive stores as well as franchise
● Most of the stores are owned by the stores.
company itself. ● Strong online presence
● The stores are located in posh
locations and are spacious and
modern in look with walled mirrors
and excellent lightings.
Promotion Promotion
● Practices the policy of zero ● Multi-channel promotion.
investment in marketing. ● Direct marketing through campaigns.
● Stores heavily rely on brand ● Strong celebrities, bloggers, and
recognition. press influence.
● Spends more money on the store and ● Digital marketing, T.V ads,
its decor. campaigns, and CSR.
4. Zara's entry into India
● To enter the market in India, Inditex (the company behind Zara) used the strategy of
pursuing a joint venture with Trent Limited, a Tata Group company, a highly
recognized clothing line distributor in February 2009.
6
● When Zara entered into the Indian market, it combined western and local clothing
styles to offer a variety of lines to all customer tastes; the retailer realized that the
majority of people wear traditional clothing and have less experience with the concept
of rapidly-changing fashion, and Zara’s restrained color palette was different
compared with colorful Indian tastes. Secondly, the clothes market isn’t as affected by
seasonal change, with many parts of India not experiencing a cold season. Zara
applied its feedback loop approach to the Indian stores, where store managers were
required to report back on the progress and customer feedback on clothing styles and
preferences.
● Zara pursued a strategy of selling a variety of its local clothing lines and international
clothing lines but maintaining Zara as the primary brand in India.
● To promote the organization and its clothing lines, Zara utilized video advertisements,
print ads, and the idea of e-marketing which fulfilled the varying needs of consumers
from India and beyond; particularly those priority Indian markets or the consumers in
the urban India areas.
5. H&M's entry in India
● H&M entered India in 2015.
● Janne Einola is the country manager of H&M India.
● It opened its first flagship store in Select City walk in Delhi.
● Entered India with a pan-India expansion strategy.
● Entered with an initial investment of 700 crores.
● It focused on tier 1 and tier 2 cities to expand itself in the Indian market.
● It currently has 50+ stores and will continue to add one store a month.
● The production office of India is in Bangalore. The Retail Head office of India is in
New Delhi.
● H&M was successfully launched on India's leading e-commerce platform Myntra in
August 2019.
● It would open 50 stores in India with an investment of Rs 700 crore by 2020.
7
6. SWOT analysis of Zara
STRENGTHS WEAKNESSES
● Global presence with strong brand ● Easy to replicate designs.
value. ● Lots of unsold inventory.
● Higher customer satisfaction. ● Limited marketing and advertising.
● Affordability and value for money. ● High brand switching.
● Efficient supply chain. ● Backlashes due to sensitive
● Strong retail network. campaigns.
● Investment in technology and
innovation.
● Strong online presence.
● High customer engagement.
OPPORTUNITIES THREATS
● Global market presence. ● High competition.
● Increasing online shopping trend. ● Legal and political regulations.
● Investments in marketing. ● The rising cost of raw materials.
● Scope of expansion in product lines. ● Economic downturn due to
● Innovating in terms of sustainability. pandemic.
● Consumer switching.
● Rising labor costs.
8
7. SWOT analysis of H&M
STRENGTHS WEAKNESSES
● In house designers. ● Over Dependence on Outsourcing.
● Affordable and good quality ● Depending on luxury brands to
clothing. trickle downtrends.
● Better prices than competitors. ● Ethical issues like labour
● High customer satisfaction. exploitation.
● Wide range of products. ● Easy to replicate designs.
● The leader in the global fast fashion ● High brand switching.
market (2nd). ● Inconsistent fit.
● Strong social media presence.
OPPORTUNITIES THREATS
● Celebrity endorsement & ● Currency fluctuations.
cooperation. ● Intense competition.
● Increasing online sales growth. ● Increase in Counterfeits.
● Expansion in emerging markets. ● Global Pandemic.
● Scope of increasing product lines. ● Quickly changing fashion trends.
● Including more sustainable business ● Rising labour costs in developed
practices. countries.
9
8. Suggestions for better penetration in India (Zara):
● Store expansion: Currently Zara has a lesser number of stores in India as compared
to its competitors. It can mark a strong market presence by expanding the number of
stores.
● Effective reproduction: Zara should focus on effective reproduction techniques to
avoid out of inventory issues and customer dissatisfaction.
● Investing more in marketing: Currently, Zara follows a low marketing strategy, but
it should invest more in it to catch more customers and increase brand awareness.
● Expansion in tier 2 cities: Zara should try to expand itself more in tier 2 cities along
with tier1 cities.
● Sustainable approach: These days consumers are becoming more and more
environmentally conscious. Zara should avoid overproduction and misidentification
of trends to be more sustainable.
● Interactive fitting rooms: In many countries, Zara provides interactive fitting rooms
which allow consumers to request the advice from staffs as well as more information
on certain garments via tablet devices located in each fitting room, this technique
should also be followed in the Indian market as Indian consumers are becoming more
technologically advanced day by day.
● Cultural considerations: Zara should explore reaching out the Indian customers
while keeping in mind their cultural beliefs and values.
9. Suggestions for better penetration in India for H&M
● Store expansion: H&M should be a more aggressive in-store expansion in India as
the Indian apparel market is in the growth phase.
● Blue ocean strategy: H&M may introduce a large scale of products focused on over
60 aged population by creating a new sub-brand name to maintain customer’s
perception of the brand whereas all the manufacturing processes will remain the same.
● Increase Sportswear growth and Investment: H&M should exploit the opportunity
that has arisen from the increasing tendency of Indian consumers to be more health
and fitness conscious.
10
● Innovation in marketing: H&M should try to innovate in its methods of marketing.
Like Zara has already evolved its marketing model shifting from the old 4Ps of
Marketing to the new 4Es model.
● Website: They could also simply just create an H&M website in local Indian
languages which is going to effectively serve the Indian population.
● Relationship marketing: Taking relationship marketing and management into
perspective, H&M will be able to develop an approach that is going to be able to
target the various challenges of the modern Indian market. Relationship marketing can
transform into multiple service usage from single service usage.
● Customer Relationship Programme: Customer retention can be achieved through a
customer relationship program. H&M has to research heavily to be able to penetrate
the Indian market.
10. Conclusion
● On comparing the two fast fashion giants, we found that both the brands are trying
well to establish themselves in the Indian market.
● While H&M is being quite experimental when it comes to marketing, Zara prefers to
invest less in marketing and more into the customer experience aspects, especially the
retail stores.
● H&M is showing a picture of a promising future in the market. It has been inferred
that H&M has now become the faster growing global fashion brand in India. H&M
has overtaken Zara.
● Also, H&M has added a significant number of stores across India in recent years. This
competition is expected to slash prices even further in the industry, while every other
brand attempts to prevent customers from being attracted to shop at H&M.
● Other contributing factors to H&M’s growth in India this year include many discounts
and sale promotional events and a low-priced basics clothing assortment that be can
condescending to similar offerings from competitors.
● H&M has made strides since their 2015 entry into India and, as their store expansion
plans show no signs of slowing down.
● All their doing is, to strive towards becoming the largest international fashion brand in
India.
11
● H&M hasn’t evolved beyond the 4Ps model of marketing – Product, Price, Promotion
& Placement – while Zara is operating under the 4Es model in line with the
expectations, wants, and needs of today’s customers.
● Zara includes the customer in the decision-making process, whereas H&M dictates
the decisions down to the customer, like in the old days when designers dictated
fashion trends for the customer. But now the consumer calls the shots. Zara gets it, but
H&M still has to learn it.
References
https://www.academia.edu/25311429/Zara_Marketing_Plan
https://www.investopedia.com/articles/markets/120215/hm-vs-zara-vs-uniqlo-comparing-
business-models.asp
12
https://www.harbott.com/analysing-zaras-business-model/#:~:text=Zara's%20target
%20market%20is%20young,them%20a%20much%20broader%20market.
https://notesmatic.com/2017/02/zara-marketing-mix-and-marketing-strategy/
https://www.mbaskool.com/brandguide/lifestyle-and-retail/3814-zara.html
https://www.mbaskool.com/brandguide/lifestyle-and-retail/2934-h-and-m.html
https://www.mbaknol.com/management-case-studies/case-study-zaras-entry-into-indian-
retail-fashion-market/
https://www.academia.edu/12881172/Marketing_Strategy_H_and_M
https://sbmldanielle.wordpress.com/2017/06/02/blog-post-title-5/
https://www.uniassignment.com/essay-samples/marketing/h-m-and-its-strategy-for-the-
indian-market-marketing-essay.php
https://www.totalassignmenthelp.com/free-sample/marketing-and-communications
https://www.borngroup.com/how-zaras-winning-strategy-is-disrupting-the-indian-fashion-
retail-industry/
gvhdsfhhj
13
14
