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ZARA Case Study Solution- Consumer Behavior Research for ZARA

ABSTRACT

Background

The brand name of Zara is strong in the market and the company has a strong new product pipeline which presents more than 10000 new designs every year that amounts to approximately 30 new designs a day. With such an enviable catalogue and the distinction of owning the entire manufacturing setup and controlling it in – house, Zara is leagues apart from other traditional retail houses. The researchers have identified some issues in Zara’s sales in their Melbourne store. They believe that lower sales are affecting the finances and hence the underlying causes need to be studied.

Research Methodology

This study is conducted using the survey methodology with a simple five point Likert-scale based questionnaire to gauge customer responses about the brand, its quality, pricing and promotion. Random sample of 30 customers were chosen. Another brief survey of 20 employees involved in three different functions in the Zara store was also conducted to reinforce the customer survey findings.

The responses are tabulated and descriptive statistics generated to analyse the responses.

Findings

  1. The promotional mix of Zara is not effective as perceived by the customers.
  2. Product pricing is felt unsuitable as customers are unable to get a justification for the same.
  3. New product launch is not percolating to the paying customers to frequently visit the stores and bolster the sales.

Recommendations

The Inditex management should provide individual brand-wise performance to truly analyse Zara’s contribution in the group. A detailed survey of larger sample size and wider number of stores and geographies is required to validate the findings of this research and deduce the problems.

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