BUS7B33 Customer Continuity and Growth
Introduction
Zara is one of the biggest high street retail chains globally with Amancio Ortega as its founder, offering a competitive edge in the market by delivering quality products at reasonable prices. The company uses a multi-channel marketing strategy for engagement of the consumers through communication which includes social media platforms such as Facebook, Instagram, Twitter, Youtube and Pinterest (Islam, 2022).
Aims
The report aims to analyse the communication strategies used by the company Zara to help in consumer continuity and growth in the long run.
Objectives
- To study the strategies applied by Zara in communication to help in consumer continuity and growth
- To study the application of marketing theories applied to Zara to achieve continuity and communication among consumers
Background
Background of the company
Zara is a Spain-based clothing retailer brand which has been currently owned by Inditex, which has opted for the usage of Augmented Reality experience in stores as well as in online stores. The company initially launched around 120 stores worldwide and the introduction of such technology has been used as a strategy to draw consumers in-store and on online platforms (Refer to Appendix 1). The creation of consumer curiosity has been the most powerful pull marketing strategy that has been used by Zara, the strategy has been established to enhance the consumer experience that helps in the continuity of consumers and growth of the brand (Chen, 2021).
Evaluating strategic communication in meeting marketing objectives
Zara uses social media profiles to gain the attention of the targeted consumers as a way of marketing and communicating programs designed by the company to attract and retain consumers in the industry. Zara uses a creative marketing strategy to develop the marketing communication message to serve as an important factor in the success of the marketing campaign of the company. The key marketing objective of Zara is to enhance the consumer experience in the market, for which Social media marketing and marketing communication strategies are used to retain the consumers in the retail industry (Popović et al., 2021).
Analysis
Models/theories evaluation for customer continuity growth
Customer life-cycle management model
The application of the model in Zara may be beneficial in delivering excellence in satisfaction through policies and actions in creating loyalty bonds and positive switching barriers. The proactive strategy used in the model may help Zara to create a prediction about consumer value segmentation along with an efficient alarm system and the marketing strategy of social media platforms such as Facebook and Twitter may help in the creation of commercial actions to retain consumers in the market. The retention step in the model may be utilised by Zara to create reactive retention policies that may prevent the consumers to switch to other competitors such as H&M in the fashion retail industry (Fahy and Jobber, 2019). The technological advancements in the brand website and also in the stores such as Artificial Intelligence and proactive recovery policies in the brand may also help the company to help in consumer continuity and growth in the long run.
Basic Customer Growth Model
The concept of the Basic Growth Model is to ensure the growth of the consumer base of a company by acquiring new consumers in the targeted market. This model applied to the marketing strategy of Zara may help understand the areas of improving acquisition to grow the consumer base as well as revenue. Zara has been careful about designing the marketing strategies through social media marketing and communication strategies to hold on to existing consumers by meeting their needs and wants. Neglection of the exciting consumers may lead to the growth rate base of consumers and acquisition policies in the marketing strategies may not fulfil the marketing objectives of the brand (López et al., 2022). Retention of the existing consumers has been critical for the business of Zara through the marketing strategies of coping with the latest fashions to meet the changing demands of the consumers. Social media platform usage as a marketing strategy may be useful to the company in creating a long-term business model with long-term contracts with the consumers and increasing brand loyalty through effective communication (Amoah et al., 2021).
Figure 1: Basic Consumer Growth Model
(Source: Amoah et al., 2021)
Identifying gaps
In this report, the gaps that have been identified are keeping consumer centre marketing objectives, which may not be fruitful for the company to go ahead of the competitors in the retail industry in the long term. Another gap that has been identified is that the level of consumer expectations may not be aligned with the company’s perception of marketing to attract the consumer base in the industry, the marketing of fewer products on the company website may lead to downsizing the consumer expectations from the brand leading to switching of brands.
Suggestion for gap
Zara may be able to upgrade the marketing objective from being only consumer-centric to focusing on the needs and demands of the consumers along with a market analysis strategy to understand the sales and revenues of the competitors in the market. The loyalty and reward programs may be optimised by the brand in Social media marketing and communication marketing strategy to attract consumers and retain existing ones.
Analysis outcomes
The application of the Customer Life-cycle management model may be stated to be beneficial for Zara in making predictions about the retention rate and the switching decision of the consumers in the market. The implementation of the model provides the brand with insights into the requirement of change in marketing strategies to help in the retention of consumers in the market. The basic Consumer Growth Model may help Zara to gain insight into the acquisition factors to be implemented in the market strategies applied by the company to attract a consumer base.
Conclusion
It may be concluded that the marketing strategies used by Zara may be upgraded with the application of the models mentioned in the report to gain insight into the changes required to increase the continuity of consumers and the growth of the brand.
References
Amoah, J., Belás, J., Khan, K.A. and Metzker, Z., 2021. Antecedents of sustainable SMEs in the social media space: A partial least square-structural equation modeling (PLS-SEM) approach. Management & Marketing-Challenges for the Knowledge Society.
Chen, Y., 2021. A Social Media Mining and Ensemble Learning Model: Application to Luxury and Fast Fashion Brands. Information, 12(4), p.149.
Fahy, J. and Jobber, D., 2019. EBOOK: Foundations of Marketing, 6e. McGraw Hill.
Islam, S., 2022. Digital Marketing Influences on Consumer Fashion Product Purchase Decision Through Facebook.
López Muñoz, J., 2022. Marketing plan-Suprive.
Popović-Šević, N., Jeremić, A., Slijepčević, M. and Ilić, M., 2021. Marketing focused on the online brand community: The example of Zara. Marketing, 52(1), pp.32-42.
Appendix
Appendix 1
https://www.forbes.com/sites/pamdanziger/2018/04/23/zaras-difference-pull-people-in-not-push-product-out/?sh=2ecb831523cb
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