Ansoff Matrix of Zara

Zara is a retail chain and fast-fashion Spanish multinational corporation. Rosalia Mera and Amancio Ortega founded the fashion brand in 1975. Today, we’ll discuss the Ansoff matrix of Zara; and its four growth matrix strategy quadrants; market penetration, market development, product development, and diversification growth strategy of Ansoff matrix of business example.

Elements of Market Penetration Strategy of Zara

• Collaborates with various fashion designers and brands and introduces limited edition styles
• Taking environmental sustainability initiatives by decreasing the waste and limiting the negative environmental impact
• Offering a great customer experience with unique styles and seamless shopping service experience
• Following the fast fashion strategic approach of immediately catching up with the latest trends
• Collaborating with various influencers
• Directly approach the  end customers with emails, SMSs, and other channels

Top Selling Markets and Geographical Regions of Zara

• Spain – 8.6%
• UK – 11.1%
• USA – 23%
• Netherlands – 2.6%
• Portugal – 2.8%
• Italy – 3.9%
• Poland – 4%
• Germany – 4.5%
• France – 5.1%
• Canada – 5.9%

Latest and Best Collection Offer of Zara

• Line shirt of Zara
• Openwork knit top by Zara
• Flat cross leather of Zara
• Sandals
• Bags
• Belted shirtdress of Zara
• Cropped texture boomer
• Printed midi dress of Zara

The Ansoff matrix of Zara would focus on the four growth matrix strategy quadrants; market penetration, market development, product development, and diversification. Here’s Zara Ansoff matrix company example as follows;

Ansoff Matrix of Zara

Let’s discuss the four growth matrix strategy quadrants in the Ansoff matrix of Zara as Ansoff matrix company example; they’re as follows;

Market Penetration Strategy of Zara

The market penetration quadrant in the Zara Ansoff matrix business example as a growth matrix strategy has the lowest risk in the growth strategy. It is because here the fast-fashion brand sells its current products and services in the existing customer market. However, the fast-fashion market is growing, and the market penetration growth strategy is possible.

I-Marketing

Zara runs various types of marketing and advertisement campaigns on various media channels and at its stores with captivating images and visuals. The objective of the fashion brand is to sell its existing fast-fashion items in the existing customer market.

II-Low Price

Zara has established a global reputation as a low-cost fashion brand. It helps the company to penetrate the fashion market with lower prices and offers the latest fast-fashion trending items.

III-Wide Portfolio

The fashion portfolio of Zara comprises of wide range of products and services for men, women, and children. It allows the company to target various segments of the customer market with its existing products and penetrate the market.

IV-Seasonal Offers

Zara also launches seasonal offers for sale at bundle price packages at the end or beginning of the season. It allows the company to get rid of the existing stock by selling it to the existing customer market.

Market Development Strategy of Zara

The market development quadrant in the Zara Ansoff matrix business example as the growth matrix strategy has a bit higher risk than the market penetration strategy. It is because here you expand your fast-fashion market and offer your current product portfolio in the new market. However, you don’t know the culture and response of the new market; that’s what makes it riskier.

I-Global Market

According to an estimate, Zara has established a network of over 2270 retail chain fashion stores and operates its fashion business in more than 100 hundred countries across the globe. The fast-fashion brand never stopped at the Spain, European, or American market; the company has been pushing the geographical borders and entering new markets with its existing products and services.

II-Supply Chain & Distribution Network

Zara has established a very strong supply chain and distribution network; it helps the company to enter the new market with its fashion portfolio. Whether it is the acquisition of raw supplies and materials or the distribution of finished goods, the chain fashion brand does it quickly.

III-Brand Image

Zara has set up a world’s successful fashion brand image and it helps the company to enter the new market with its existing products.

Product Development Strategy of Zara

The product development quadrant in the Zara Ansoff matrix business example as the growth matrix strategy has a higher risk than the market penetration strategy. It is because here you launch a new product service in the fashion line for the existing customer market. You would have to run new marketing and promotional campaigns for the new product and it makes it riskier.

I-New Trends

The trends in the fashion industry are changing and transforming daily and it is significant for fashion brands to keep up with the latest trends. Zara has been increasing its fashion portfolio ever since its foundation, and it has allowed the company to maintain its position in the fashion industry.

II-Lowest Lead Time

Zara has the lowest lead time of two weeks for new product development during the season. Usually, it takes months for fashion brands to develop new designs, manufacture, and launch them in the market. The fashion brand does so within two weeks, and it helps the company gain a competitive edge.

III-Product Variety

In order to keep up with the latest trends, Zara develops new fashion products over time to satisfy customer demands. Along with producing new products, Zara launches new product variants within its existing product line to keep up with customer demands.

Diversification Strategy of Zara

The diversification quadrant in the Zara Ansoff matrix business example as a growth matrix strategy has the highest risk growth strategy than all three previous growth strategies. It is because here you launch a new fashion product or service in the new customer market. You won’t know how your new market will react to the new items.

I-Horizontal & Vertical Diversification

Zara has successfully launched various new fashion products in the newer customer market in the clothing and beauty product category. It has allowed the company to stabilize and strengthen its revenue and profitability over the years.

Conclusion: Zara Ansoff matrix Company Example | Growth Matrix Strategy 

After an in-depth study of the Ansoff matrix of Zara; we have realized that Zara is the world’s leading retail chain fashion brand. If you are learning about the Zara Ansoff matrix company example; then you should keep in mind the abovementioned growth matrix strategy quadrants; market penetration, market development, product development, and diversification.