MBA7063 Singapore: Zara
In the current scenario, it is identified that the trend of digital marketing has increased at a high pace. At the same time, there are different types of e-commerce businesses exist in the market which ranges from click only operations to bricks-and-clicks (Chiu, et al., 2014).
E-commerce involves businesses selling to consumers (B2C) to businesses selling to other businesses (B2B). The scope of this study is to identify the e-commerce strategies used by the clothing industry of Singapore especially in the context of Zara.
This study has remained highly assistive towards critically analyze the online industry and its progression and development while giving concern towards customization of B2B and B2C as well as Porter’s Value Chain in the context of Zara (Bhatti, & Latif, 2014).
Furthermore, this study has supported towards offering the understanding regarding the MRP process of Zara while focusing towards innovative methods. Additionally, researcher has given concern towards offering the suggestions and recommendations of the method for the purpose of optimizing the online B2B apparel market.
This study remained highly assistive to give detailed understanding regarding the research topic while giving concern towards secondary data analysis.
1. Critical Evaluation of Online Industry and its Progression and Development
E-commerce is a transaction which gives consideration towards buying or selling the goods or services online (Taylor, et al., 2014).
The importance of e-commerce is highly considerable in the current scenario. It is identified that it supports towards mobile commerce, electronic funds transfer, supply chain management, internet marketing, online transaction processing, electronic data interchange (EDI), inventory management systems, automated data collection systems, etc. It enables the consumers to use the internet to gather the information and read the reviews before taking the decision of purchasing.
in the context of Singapore, it is identified that before taking the decision of purchasing they prefer to conduct online research. At the same time, Huang, & Benyoucef (2013) identified that E-commerce enables the consumers to conduct real-time communication while engaging the customers and getting the suggestions for developing successful e-commerce sites.
In the context of Zara, it is analyzed that its e-commerce site is designed according to the customer-centric perspective which enables the firm to create competitive advantage in the industry.
In the 1990s, Web 1.0 has taken place in the market. In this, little involvement of the consumers has seen and the sites were created by commercially and technically based firms while giving concern towards making them crude and simple. These sites were designed for the purpose of the accomplishment of a specific function (Hartono, et al., 2014).
In the current scenario, Web 4.0 has taken place in the market which has supported towards increasing the customer engagement, cloud operations and web participation. It has enabled the firm to not only sell the products to the consumers but also getting the reviews regarding their experience with the purchasing.
Change from Web 1.0 to Web 4.0 has supports towards increasing the trend of e-commerce which has supported to make the digital marketing more effective.
Through, this change in technology, Web 1.0 to Web 4.0 it has remained highly supportive for the apparel industry to increase the attractiveness while influencing the buying behavior (Shafiq, & Ahmad, 2015).
In the current scenario, the trend of e-commerce has increased in the context of clothing industry. Increase in the trend of digital marketing has supported to boost up the clothing industry by offering the chances to the consumers to do proper research of a product before purchasing it.
Moreover, it has the payment and delivery process easier. In Singapore, Zara is highly focused towards e-commerce which enables the firm to get the online payment from the customers, which support the firm as well as the consumers to eliminate the wastage of time while offering the convenience (Chiu, et al., 2014).
Use of Web4 technology is supporting the firm towards the increase in developing the customer base. It enables the firm to deal at a global platform and makes the B2B and B2C business more convenient.
Moreover, it has enabled the firm to get the reviews and feedback of the consumers regarding the company products and services.
2. Critical Evaluation of the Customization of B2B and B2C
2.1 Difference between B2B and B2C
(Hartono, et al., 2014) depicted that B2C (businesses selling to consumers) and B2B (businesses selling to other businesses) are basically two forms of commercial transactions which are used by the firms. B2C stands for business-to-consumer and it is a process of selling the products directly to the end users, i.e. consumers.
However B2B stands for business-to-business and in this process products or services are sold to other businesses. In the context of Singapore, Zara deals in B2B as well as in B2C.
According to the views of Leong, et al. (2016), the major difference identified in the context of B2B and B2C is the manner of advertising utilized by the firms for the purpose of influencing the buying decision.
At the same time, B2B market needs to be more planned and controlled as compare to B2C. However, in B2C marketing companies need to give consideration towards selling the finished products to the final consumer while influencing them on the basis of various characteristics as compare to other firms which are dealing in the same industry.
2.2 Content Marketing
While designing the strategy of content marketing for B2B, there is a need of increasing the concern on various perspectives. Content marketing supports towards putting the content together for the audience. While designing the content marketing, it is essential to give concern towards effective content.
In the context of Zara, it optimizes the content for promotion in an effective manner which enables the firm to make the money from the content marketing efforts (Orji, 2013).
Firm prioritizes the content according to the B2B business need while giving consideration towards determining the exact target audience and their requirements.
Zara is a firm which is focused towards harnessing marketing automation as it enables the firm to grow the importance of the Internet in the context of B2B. Buyer purchasing decisions get highly motivated through the digital content as it supports to lead the potential of the buyers while increasing the interaction with the firm.
In support of this, Kłeczek (2014) depicted that content marketing is one of the major strategic marketing approach which is focused towards creating and distributing valuable, relevant and consistent content for the organization to attract, influence and retain the clearly defined audience. Moreover, it enables the firm to ultimately drive profitable customer action.
Interactive strategy is used by the firm in B2C. This strategy is based on digital perspective which supports to strengthen the complex relationship with the firm and the consumers while focusing towards design, content, usability, technology marketing and other perspectives.
Raise in the usability of smartphones and tablets has supported towards increasing the need of developing interactive strategy to enhance the access of the company to thousands of apps while increasing the ability of operating the cloud based system which supports the users to increase the access of the brand anywhere, anytime (Lu. 2014).
Interactive strategy enables the firm to promote their products, new product launch, discount offers, etc. through using social media as well as through blogs, Twitter, etc. It enables to engage the consumers with the brand while developing two-way communication.
In this context, internet supports to offer ideal medium for increasing the interaction within the market. According to the views of Einav, et al. (2014), interactive strategies enable to give emphasize on two primary activities. Firstly, targeting individuals, potential consumers and existing consumers while giving concern to personalized information and secondly, engaging the consumers with the company and products.
Interactive strategy is used by the firm to create effective communication with the consumers which enables towards developing effective communication. To design an effective strategy, Zara has a team of thinkers, artists and inventors who have shared enthusiasm of creating innovation and creativity to offer quality product as well as services to the consumers while offering quality services (Müller, Mitchell, & de Zwaan, 2015).
3. Critical Evaluation of Porter’s Value Chain
According to the views of Porter, & Heppelmann (2015), Porter’s value chain supports to understand that there is chain of events which occur within the organization.
These events start from the procurement of the raw materials to the delivery of finished goods. Moreover, it also includes the post sales services too. Porter’s value chain includes 9 steps however the process can be changed at any point of time to add further value in the context of the final product.
This system enables the firm to develop the coordination between the various activities while giving concern towards the requirement of the business. Additionally, it enables the firm to meet its financial, non financial goals and the objectives.
Porter’s Value Chain
(Source: Porter, & Heppelmann, 2015)
3.2 Applying Porter Value Chain for Zara
Zara, Singapore is highly focused towards applying the value chain model in an effective manner (Porter, & Heppelmann, 2015). In this context, firm gives huge focus towards linking the primary and supportive activities of the company. It enables the firm to increase its strength towards the creation of competitive advantage in the industry.
Primary Activities
In the context of primary activities, Zara is inbound logistics firm is highly focused towards the purchasing of the quality raw material. In the context of operations, proper check on the quality, inventory and many other factors take place.
Firm offers exclusive brand so it only produce in limited numbers to eliminate the chances of decreasing the chances of unpopular stock (Lu. 2014). Firm delivers only limited number of stocks to its different stores in the context of outbound logistics.
Zara gives major concern towards digital marketing as it supports to increase the positive brand awareness of the firm to its target customers. In like manner, firm is highly focused towards pre and post customer services (Moeller, 2016).
Supportive Activities
In the context of supportive activities, Zara has attractive stores which shows firm gives huge concern towards firm infrastructure. In like manner, firm’s website is designed with utmost care while giving concern towards consumer attractiveness as well as towards easy to use factor too.
At the same time, firm gives huge concern towards the hiring of experienced, skilled and dedicated human resources and gives time-to-time training to the employees for their upliftment (Crane, et al., 2014).
Zara uses latest technology for increasing the quality of its product and procure the raw materials from the specific areas from where it can become able to receive quality. For instance – Zara majorly sources sophisticated fabric, cutting, and sewing facilities from its design headquarters which is in Spain (Lu. 2014).
3.3 Discussion of Inbound/Outbound Logistics, Services
In the context of inbound logistics firm gives huge focus towards purchasing of inventory, producing quality products, producing limited quantity of the products, give concern towards current market trend and consumer need. At the same time, firm produces the products from the affordable to luxurious range (Leong, et al., 2016).
In the context of operations, Zara gives concern towards proper quality checking. Additionally, various methods are used to manage the inventory such as JIT (Just in time), utilization of inventory optimization models, centralized logistic management and solid distribution network which enables the firm to eliminate the chances of dead stock. Moreover, firm only produce the products in limited numbers (Lobo, Meyer, & Chester, 2014).
This strategy increases per unit costing but supports towards eliminating the chances of unpopular stock (Lu. 2014). In the context of outbound logistics, Zara only delivers limited stocks to its stores while giving concern towards current market needs and trend. Zara, Singapore is highly focused towards service parameters and offers pre and post customer services to increase the customer satisfaction as well as to increase the chances of brand loyalty (Yamit, 2016).
Firm is focused towards producing limited number of products which enables the firm to eliminate the chances of un-popularization of the product as well as supports towards decreasing the chances of dead stock.
In the context of inbound and outbound logistics, firm is highly focused to deliver the materials as well as finished goods to the store on time. Firm has a strength of great transportation (Berbegal-Mirabent, Mas-Machuca, & Marimon, 2016).
It has centralized inventory storage system which enables towards storing the inventory in an effective manner which supports to eliminate the chances of dead stock as well as enables towards transferring the goods to the stores only in a limited quantity while giving huge concern towards current trend.
4. Optimization of Material Requirement Planning (MRP) through Innovative Methods
Material requirements planning (MRP) is a process which supports towards production planning, scheduling, and inventory controlling while giving concern towards managing the manufacturing processes.
In support of this, Yamit (2016) depicted that mostly MRP systems are software-based however it can be done manually too. In the context of Zara, Singapore it follows various strategies for the planning of material such as just in time (JIT) production, utilization of inventory optimization models, centralized logistic management and solid distribution network. In this context, JIT supports the firm to minimize the chances of decreasing the dead stock while increasing the chances of delivering the fashionable and trendy clothes in the market (Eves, & Wilkinson, 2014).
Zara majorly sources sophisticated fabric, cutting, and sewing facilities from its design headquarters which is in Spain (Lu. 2014). Although the wages of these European workers are higher as compare to developing countries but it enables towards delivering miraculous quality (Lu. 2014).
Its inventory management system supports the firm to eliminate the chances of dead stock. Inventory optimization model supports the firm to help the company to determine the quantity that is need to be delivered The stock is delivered in a limited number while ensuring that each store of Zara only receives the inventory that they need.
This strategy enables the firm to create exclusive brand image while eliminating the chances of unpopular stock (Lu. 2014).
The secret to the success of Zara lies in centralized logistic management which enables the firm to take the decisions in a very coordinated manner.
At the same time, Zara has strong distribution network which enables the organization to deliver the goods to its European stores within 24 hours and to the American and Asian outlets within 40 hours (Lu. 2014).
5. Suggestions and Recommendations of the Method to Optimize Online B2B Apparel Market
5.1 Importance of B2B for Apparel Industry
B2B plays an important role in online business as it allows corporate clients to place their orders easily.
It supports the firm to deal in a global market while decreasing the time and cost as it eliminates the chances of physical presence. It increases the efficiency of the suppliers by offering them the facility of easy delivery as well as by offering different modes of receiving the payments (Huang, & Benyoucef, 2013).
Moreover, it supports the business to select the suppliers while evaluating the price, quality and many other parameters. At the same time, it supports to do proper research regarding the current trend which supports to bring new trend according to the consumer taste in the market.
Online medium is one of the best way to reach to the customers as it enables the firm towards directly interact with each and every consumer. It is a place where consumers easily give their feedback. Firm can also use the strategy of online survey to get the acknowledgement of consumer point of view in various perspectives (Hartono, et al., 2014).
Digital marketing enables the firm to popularize the company product while giving concern towards increasing the brand awareness and brand recognition. In the context, Einav, et al. (2014) identified that Zara is highly focused towards digital marketing and due to this reason firm has designed its website in an adequate manner (Foxall, 2014).
However, Zara needs to increase concern towards increasing the trend of dealing in social marketing as well as there is a need of giving focus towards conducting the online survey time to time from the side of the consumers to know their perspective regarding the company product as well as services.
In like manner, there is a need of increasing the concern towards SEO (Search Engine Optimizer) which will enable towards bringing the site in top ten in the context of search engine (Crane, et al., 2014). There is a need of developing effective content, info-graphics, images, etc. to attract the consumer buying behavior which will support towards increasing the visibility of the website while increasing the engagement time on the website.
It is essential for the firm to give concern towards feedback as it supports towards delivering the products or services according to the consumer desire.
For this purpose, Zara, Singapore needs to give focus towards the feedback or review given by the consumers in the context of the firm while purchasing the products on the website as well as on the comments on social media or tweet on Twitter (Leong, et al., 2016).
In the context of feedback management, Zara needs to employ a team who give concern towards customers’ feedback and the feedbacks which are genuine and needs to be addressed should be take care by the firm. This practice will enable the firm to increase the customer satisfaction and will support towards increasing long-term sustainability at the global platform (Dasar, Hundekar, & Maradi, 2013).
Zara, Singapore is a firm which is well-known for its effective service. This firm is highly focused towards employee satisfaction. However, always there is a room of improvement.
In this context, Zara needs to improve its services while giving concern towards innovation and creation (Chiu, et al., 2014). Firm needs to shorten the lead time. At the same time, there is a need of increasing the concern towards training of the employees so that they can improve the quality of conversation with the customers. Moreover, there is a need of updating the website time to time so that consumer gets the latest information (Mishra, et al., 2014).
Firm needs to give concern towards the strategies used by the competitor firm so that it will become able to remain up-to-date according to the contemporary market need.
From the above study, it can be concluded that in the current highly competitive environment, e-commerce remains highly assistive to make effective relationship with the consumers. It supports to make the payment mode easier while giving concern towards giving the opportunity to the consumers to offer their feedback which enables the firm to make the changes according to the consumer demand.
At the same time, it enables towards increasing the chances of direct interaction with the consumers. It supports towards enhancing the convenience through offering various payment modes and delivery at the place.
Moreover, it allows the consumers to research the product in a well-defined manner before purchasing it. This study remained highly assistive to give detailed understanding of e-commerce Zara, Singapore. Moreover, it has enabled to offer suggestions and recommendations too which will support the firm to increase the competitive advantage and long-term sustainability in the industry.
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