Renowned retailer Zara is one of the most profitable companies in the world. Operating since 1975, in 74 countries, it is the most recognizable brand in the Inditex group and the most successful. In 2017, Zara is estimated to have a net worth of $11.3 billion, which places it far ahead of competitors such as Japanese brand UNIQLO, or Swedish giant H&M (Forbes, Web). Founded in La Coruna, Spain, by Amancio Ortego, the reclusive billionaire made global headlines when he ousted Microsoft owner Bill Gates at the top of the Forbes rich list for two days in 2016 with a net worth of $83.7 billion (Bloomberg, Web).
The company’s main target market is predominantly millennial, presenting style-conscious and cost-effective alternatives to much more expensive high-street brands. Zara is known to have several high-profile supporters, who have become unofficial ambassadors for the brand. These include Kate Middleton, the Duchess of Cambridge in the UK who famously wore a $50 Zara dress to her sister Pippa’s wedding, injecting a massive boost in sales for the brand (Vogue, Web). Ivanka Trump is another well-known Zara wearer.
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According to Harbott.com, Zara produces around 12,000 styles per year. It operates a unique policy of identifying trends, designing the product, and then releasing it to the consumer in a thirty-day turnaround (Harbott, Web). They also use a scarcity model. This has the dual effect of stimulating customers to buy desirable products in a limited timeframe, while also lessening the chance of accumulating unsellable stock.
Zara’s current design trend is “Shape the Invisible” (Zara, Web). Rather than having a single famous designer, this new movement is a collaboration between four of the biggest design schools in the world: The Royal Academy of Antwerp, Kingston University, London, EnsAD, Paris, and Parson’s School of New York. Sustainability is a significant part of this process, as the sixty students have been given clothing from previous seasons, from which they must create their own vision.
In conclusion, the Spanish chain continues to innovate and expand, when many of its competitors have begun to falter. Zara is uniquely popular amongst both the super-rich and the average middle-income consumer. Its chic, elegant styles are proving to be increasingly popular, while its growing consciousness of the importance of sustainability helps the company to gain more positive publicity.
