Be honest: Which of ZARA’s advertising campaigns did you like best?
Can’t remember one?
No wonder, there exists none!
Company without advertising? Impossible!?
Why does this extremely successful clothing retailer does not spend any money for promotion campaigns and applies a kind of “zero-advertising” strategy? In fact, ZARA only spends 0,3 % of revenue on advertising which is comparatively little to the 3,5% its competitors spend.
I was initially confronted with this topic as I read one of Connie Hoe’s post in her marketing blog “freestyle. versetwo (http://blogs.ubc.ca/doyeonhoe/).
In her post “zara & marketing by “zero-marketing”” she describes perfectly why there is no need for ZARA to launch promotional campaigns. This was the first time I read about “USP”, the Unique Selling Proposition.
…Unique Selling What?
So what is this “USP” about? In accordance with Wikipedia, it is an outstanding performance feature used in marketing and sales psychologie that sets an offer e.g. a product considerably apart from its competitors The unique selling proposition should be tenable, target group specific and efficient amongst others concerning price, time and quality. In other words, it is the answer to the question: ” Why should I buy this product from this brand and not from anybody else?”
Thus, a company has to persuade all consumers that buying their products is the best possible solution and that they are better than other companies.
How to become special on the market
Creating this uniqueness could be done by focussing on different product or service aspects: Some entreprises try to distribute their goods as fast as possible (e.g. McDonalds), some intend to make their products very affordable (e.g. Aldi) and others produce their products with high-standart quality (e.g. Gucci). As we all know , these companies are famous for their products and services and thus highly succesful.
On the whole, it does not really matter which of those strategies a company uses to make its products seem extremely outstanding but the company needs to create a nice image of itself to maintain its consumers. If consumers experience that a company is “better” than others, they will come back. The company gets a good reputation, attracts masses of consumers and as a result, generates revenue.
Something economic – Life cycle of the USP!
The best condition for creating a USP is an unsaturated market. During the introduction and growth stage of the product life cycle, it is the first product of its kind available on the market and hence unique.
In the maturity stage, the focusing on product’s unique characteristic in advertising can be problematic. Now, the product is established on the market but competitors try to copy it and offer similar products on the market. The product’s special attribute loses in value and is no longer clearly visible for the consumer. Thus, the marketing strategy has to be adjusted to the conditions of the matured market. As differences between similar products are relatively little, the company that tries to maintain its USP has to react in terms of price or quality changes: Either the company is cheaper as others with the same efficiency or is providing more service for the same price (outpacing strategy). Another strategy tries to create a brand charged with emotions that serves as unique feature and make consumers commit themselves to the company. Advertising for this product can be kept focused and simple according to the products special attributes during this period.
To cut a long story short: A unique selling proposition has to be established and needs to survive on the market.
What about ZARA now?
ZARA has different outstanding characteristics that give it its Unique Selling Propositon whithout needing advertisments:
- Short processing time: ZARA is very successful and rapid in spotting trends that will be favored by costumers. Moreover, it takes Zara only 30 days from the discovery of a trend until its sale in a shop.
- Great variety of styles: Nearly twice a week, new styles come into ZARA’s shops and stay there for 4 weeks. Therefore, the chance of hitting the spot concerning consumer’s preferences increases as there is a greater choice.
- Low prices: ZARA copies styles from exclusive and expensive brands and makes them affordable to the masses.
- Low quantity of items: In its stores, ZARA keeps only 10 pieces of each style. This scarcity sets buyers under pressure: If they don’t buy an item immediately, they might miss something.
All of these features make ZARA special and hence successful on the market.
Personally, I can confirm the pressure created by the scarcity of items:
Before my research, I did shopping at ZARA’s without knowing that styles change weekly.
I just bought clothes because I liked the styles. But now, I want to go to ZARA to avoid missing something really cool: Maybe I might miss a nice jacket that everyone would have envied me. If you know that something might be unavailable in two weeks, you are more likely to buy it (even if you don’t really need it!).
These ZARA guys are really,really clever. They know how to do marketing and catch us as helpless consumers.
Personal advice: The next time you shop at ZARA, think of its UPS and avoid buying stuff you don’t need!