Analysis of Zara Customer Service Facilities - Essay Example

Zara Research Study The fashion industry in the United Kingdom is expanding rapidly. There are several players operating internationally,such as Asos, Zara, Benetton, Marks & Spencers and H&M. Each of these companies follows unique business models and emphasize upon different aspects for further growth of their business. Some of the key concerns are marketing and advertisement, pricing strategies, customer service and store location and layout. In this paper the researcher presents a study made on the famous fashion brand Zara. Zara is a part of the Inditex Group that distributes the products of Zara across the globe. Research has been made on customer service facilities offered by Zara and customers’ perceptions regarding this subject. Both primary and secondary data have been used for the study. Secondary data have been collected from different databases and existing literature published on past studies. Primary data have been collected by employing quantitative method of study. A sample population of 100 customers having shopping experience with Zara have been interviewed by distributing a structured questionnaire containing 5 close ended questions. The questions have been framed with the objective of understanding customer perceptions about customer service facilities provided by Zara. The secondary objective of this study is to investigate the relationship between age of customers and their perceptions. Responses of the participants have been measured in a five point Likert scale. The alternative hypothesis is that Zara provides satisfactory level of customer service. The responses are analysed using the t-statistic and the estimated value of t statistic is found to be sufficiently greater than the tabulated value. Therefore the alternative hypothesis is accepted. This establishes that customers have strong positive perception about customer service facility provided by Zara. It has also been found that compared to the youths, the middle aged population hold better perceptions about the company’s customer service. Table of Contents Table of Contents 3 Introduction 4 Research Design 6 Findings of secondary research 10 Findings of primary research 10 Conclusion and limitations 13 References 15 Appendix 16 Introduction Zara is a famous international fashion brand. It is one of the eight store set ups of the Inditex Group, which is one amongst the largest retailers in the fashion industry in the world. The Inditex Group is an assimilation of approximately one hundred textile companies that conceptualize designs, manufactures fabrics and distributes them. The first shop of Zara was opened in the city of Coruña in 1975 (Inditex, n.d.). Presently, the company has expanded its network to four hundred cities in eighty seven countries. Zara’s approach towards the development of designs is entirely customer-centric and it maintains an unbroken relationship with its customers to receive invaluable suggestions from them for its team of creative designers (Zara, 2010). In this paper we shall discuss the issues related to customer service in the fashion industry in the United Kingdom and the perceptions of the customers regarding the presales and post sales service by the popular fashion brand Zara. Based on our findings we shall evaluate the status of customers’ service of this company in the UK market. Although there is enough literature on the marketing strategy of firms and their pricing policies, not many researchers have studied the context of customer service in the fashion industry. For our study, the selection of company is a major step and Zara has been selected since it is a highly customer centric brand that values customer satisfaction as an asset and banks upon it for further business growth. Research aim and objectives The main aim of this research is to gain in depth understanding about relationship between customer service provided by the firm and consumers’ perception regarding customer service. Through this study the researcher would get answers to the following questions: What is the state of customer service in the UK market for fashion brand name Zara? What are the customer perceptions in relation to the different aspects of customer service such as timely delivery and attendance to customer inquiry? What is the relationship between age group of customers and their perception about customer service? Preliminary literature review This chapter aims at reviewing the previous works by other authors on the subject we are dealing with in this report. This allows one to identify the gaps in study and make plans for the approach of the current study. The 4ps of marketing has been in vogue for researches on this subject for a long time. But now, business leaders have realized there is a need to change their view of the market and their ways of making strategies. Knox (2004) has emphasized that a transformation in the organizations’ functioning, its brands and values must arrive with the vision of the customer value. Customer value helps in determining the positioning and branding of an organization. Customers are aware enough to make their own choices. When customers obtain more benefit than the costs incurred by them in purchasing the product, customer value is generated. It has been recognised that as customers’ demand for goods and services grow, companies find it more difficult to bring a holistic solution to this problem. The model illustrated in the paper, which if assumed by business leaders might help in their brand positioning consists of four components, reputation of the brand, performance of the product or service, ‘product and customer portfolio’ (Knox, 2004, p. 109) and networks. Reputation of the brand is not a separate entity of the brand, but, is formed by the perception of the customers themselves. Performance of the product and product portfolio can be judged through the evaluation of customers’ satisfaction. This model is therefore helpful in making researches for our current paper. In the paper titled ‘The Spaces and Places of Swedish Fashion’ by Hauge, Malmberg and Power the authors have shown that firms producing fashion accessories and apparels are not restricted to production of material commodities, but are producing ideas or concepts. In the world of fashion, ideas are the central products that are sold in the veil of apparel, shoes and other accessories. These firms are operating overseas and hence intensely knowledge based. Knowledge circulates between the customers and the producers and each side affect the other. The monetary worth of fashion is derived from retail sales, but the immaterial value created through efficient customer service is a strong resource for the growth of these companies. Customers are an important part in the production of intangible value. The authors have investigated into this matter and focussed on evaluating the role of retailers and customers in the creation of designs and production of new products. Research Design This section will provide a description of the structure of research adopted in this study. The research design is the framework used to generate evidence for the investigation of the research question framed by the researcher (Bryman and Bell, 2007). The primary function of research design is to certify that the facts and data available would allow the researcher to find the answer to the research question unambiguously. Five prominent designs for research can be identified; experimental designs, cross-sectional design, longitudinal design, case study and comparative design. The research design has been adopted for this study in accordance with the availability of information. Since this study is to be made within a short time frame, the data has to be collected at one point in time. It is a typical form of cross sectional research design (Bryman and Bell, 2007). While cross sectional form of research embodies both quantitative and qualitative research methods, the researcher has adopted the quantitative method of research. Justification for this research methodology is provided in the next section. Research methodology The research methodology pertains to the theory of how the research is conducted (Saunders, Lewis and Thornhill, 2009). Understanding of the research methodology allows the researcher to settle on the research method, which is the actual technique used to generate data and analyse them. Different kind of research designs are allied with different types of research methods. The research method is essentially related to the collection of data which is done within the structure determined under the research design. This section is devoted to the description of the research method specifically. The following figure illustrates the pattern of research followed throughout this study. (Source: Crotty, 1998) Positivism approach Two major philosophies of research are the interpretivist research approach and positivist research approach. The interpretivist approach of research allows the researcher to interpret the reality from a subjective point of view. However, this study involves an empirical study of the customer service phenomenon in the UK market for the fashion brand Zara. Owing to the pattern of study undertaken, the positivist approach has been adopted in this research (Crotty, 1998). It is seen from objectivist point of view which entails the quantitative method of research. Quantitative method The quantitative method of conducting a research includes determination of sampling techniques in accordance to the characteristics of sample population, selecting the sample size from the sample population, collection of data from the respondents through quantitative techniques and drawing inferences by analysing the data using various statistical tools (Watsham and Parramore, 1997). There are several advantages of quantitative method, due to which this method has been adopted for this study. The greatest benefit of using this method is the ease of representing the numerical data obtained from close ended pattern of responses (Quantitative versus qualitative methods, 2007). Numerical data allows the researcher to compare the findings easily. The data can be studied systematically even after the survey is over and can be used to make extrapolations and forecasts. The data can be manipulated in a consistent way to produce the results. It also allows scaling of the data to extract the most relevant results and easy representation of the findings in the form of graphs, tables or charts. This is a significant benefit since graphical or tabular representation allows the information to be easily communicated to the audience and saves a lot of time. However, this method has some disadvantages too. These are: Some factors have significant relevance to social or economic conditions of the respondents and might affect their decision-making. But this information cannot be represented through close-ended questions. Often to make things restricted to numerical data, good quality information has to be foregone. This level of precision keeps space for misleading information that might produce undesirable impact on the findings. Besides, quantitative method of research does not give much opportunity to develop a relationship with the participant which might open further channels of valuable information. Also, sometimes the statistical analysis of quantitative data becomes very complex and lack of proper scrutiny leads to less than accurate outcomes. Data collection The method of data collection includes both primary and secondary sources of data. For primary data collection for this study the following steps have been followed; sampling and questionnaire based survey (with structured, unstructured or semi-structured questionnaires). Sampling The population of the UK that are customers of the retail brands of apparel is more than 200,000. The researcher has used the Raosoft sample size calculator to generate the sample size of customer interviewees for administering a survey. The response distribution is approximately 50 percent, which implies that half of the respondents were male and the other half was female. Consistent with 5 percent error margin, the sample size is obtained at 384. Out of this sample only 100 respondents were found to be direct customers of the apparel brand Zara. Hence the sample size was further reduced to 100, who were then interviewed face to face. Questionnaire survey A structured set of five questions was administered on this sample population in order to collect feedback from the respondents. The questions were only close ended since it would consume less time and also make the statistical computation easy. Respondents were asked to rate customer service offered by Zara on a five point likert scale, ranging from “Strongly disagree = 1” to “Strongly agree = 5”. The advantage of using this scale is that the respondent can express agreement and disagreement about a particular topic (McDaniel and Gates, 1998). Hypothesis development Alternative hypothesis represents the opposite of the null hypothesis. It is the statement which is to be tested against the null hypothesis. H1: The alternative hypothesis is that Zara provides satisfactory customer service H0: The null hypothesis is that Zara does not provide satisfactory customer service If the value of calculated t statistic is greater than the tabulated value, alternative hypothesis would be accepted. Ethical considerations Every researcher has to consider the ethical issues before executing the research design. In the process of conducting this study the researcher has followed the code of conduct as per the guidelines introduced by “The Market research Society” (MRS, 2010). The personal details of the interviewees, such as their name, have been kept confidential. The participants were given prior information about the purpose and objective of the study. Questions related to caste, gender or racial biasness have been avoided to maintain ethical codes of research. The literature review has helped the researcher to receive a guideline for conducting research on the selected topic, but, researcher has made efforts to keep outcomes of this study uninfluenced by the existing literature. Findings of secondary research Secondary sources of data have been utilized for gathering information about the concerned subject. Zara is a brand of fashion apparel that follows a business model separate form other international brands. Customers are kept at the centre of their functionalities, starting from designing to sale of products. Zara makes the best communication with its customers through its retail shops situated around the world (Soloaga and Monjo, 2010). Hence they take care of even the minute details regarding service provided to customers. At present Zara also accepts orders through its websites. Hence customer service takes a critical position in the functioning of the firm. Zara focuses on maintaining personal contact with the customers which enhances its understanding of customer requirements and allows it to provide good service. The communication system of Zara is such that information on customer demand in the different stores is relayed to the team of designers situated in Spain through modern technology in no time. Staffs in the stores strike conversation with the customers to receive their feedback and understand their pattern of demand. Development of a new product line or recreation of similar designs requires as less as 2 weeks. Due to this system, customers do not have to wait for a very long time to satisfy their unique desires (McEachern, 2011). The essence behind good customer service facilities is the good system of communication that exists in the company (See figure 1. in appendix). Customers’ suggestions and demands are noted by the staffs and transferred to the managers who relay it to the designers. The updated lines of products are brought to the stores in two weeks time. Findings of primary research Primary research has been conducted for the study of the research question. The findings will be elaborated in this section. There was one questionnaire containing a set of 5 questions. This was distributed to a group of 100 participants. In order to maximize the possibility of communicating with the participants and to ensure that they understand all the questions completely, the survey was conducted face to face using the questionnaires. This chapter presents the results obtained from all the questions. From the responses of the participants it has been found that the respondents belonged to the age group of 16 years to 40 years. The findings show that 50% of the respondents shop once in a month from Zara and were aged 18 years to 25 years. Fifteen percent of the participants belonging to the age group of 26 years to 33 years shop once a week and the remaining thirty five percent of the interviewees were aged between 34 years and 40 years, who revealed that they shop twice in a month from the stores of Zara. For the question stating that Zara provides excellent customer service, the customers have circled the option which best fits their opinion. Those who agreed with the statement belonged to the age group of 20 years to 36 years. Out of the 31 respondents that strongly agreed with the statement, 27 participants were aged between 22 years and 35 years and 4 participants were above 35 years of age. The respondents that disagreed that Zara provides a good customer service belonged to the age group of 26 years to 30 years. The customers were asked to rank on a scale of five, two aspects of customer service facilities of Zara; quick resolve of customer queries and quick delivery of orders. The data set presented below represents the ranks assigned by the participants to the two items. The participants that had ranked the items at either 1 or 2 out of 5 belonged to the age group of 33 years to 40 years. Participants aged between 18 years to 34 years had ranked the two items at either 3 or 4. The customers that had given a rank 5 to the two items were of 27 years and 30 years of age. Aspect of customer service Rank 1 Rank 2 Rank 3 Rank 4 Rank 5 Quick resolve of customer queries 55 20 16 7 2 Quick delivery of orders 52 22 17 6 3 Analyses The population selected for this study is assumed to have normal distribution. Therefore, the t-test has been adopted for testing the hypothesis. One advantage of the t-test is that in this test the standard error of the mean difference is used for the calculation for the t statistic, and the error term excludes the individual differences. Hence, the standard error of mean has a propensity to be small. With a small denominator, the value of t statistic becomes large in overall, which creates a greater likelihood of accepting the alternative hypothesis (Smith, Gratz, and Bousquet, 2008). Since the calculated value is greater than the tabulated value, the alternative hypothesis is accepted. Therefore, it is established that Zara provides good customer service facilities. Out of the 100 respondents, the item representing quick resolve of customer queries received rank 1 from 55 participants and the item representing quick order delivery received rank 1 from 52 participants. Although the unequal distribution of the data set makes it tough to infer which of the two items scores better, it is evident from the responses that they have voted in favour of the fact that Zara provides good customer service. As a response to question 3, more than 50 percent of the participants have agreed to the fact. More than 70% of respondents have a firm belief that the customer service unit of Zara can provide efficient and quick resolve to customer queries and makes quick delivery of orders. They attend customers in the stores very fast and provide efficient responses to customers’ questions regarding product variety, quality and price. From the information gathered, it is found that the majority of population choosing an opinion of ‘strongly agree’ or ‘agree’ for the question related to Zara’s customer service belong to the age group of 25 years to 40 years. This shows that there is still scope of further improvement in their service which should be made to meet the demands of the younger generation. Conclusion and limitations The three key issues addressed in this study are the status of customer service of the fashion brand Zara, consumers’ perception regarding the aspects of customer service, such as, quick resolve of customer queries and quick delivery of orders, and the relationship of age with consumer perceptions. The objectives mentioned in the research questions are addressed through the analysis of findings obtained from secondary and primary data sources. This research has a number of limitations. In order to make the sampling method simple convenience sampling method has been followed. But it might keep space for some degree of error in the outcome. Compared to the entire customer population of UK retail market, a sample size of 100 is not sufficient to draw inference about the selected topic. Besides, quantitative method of research has not given much scope for communication with the respondents. Hence researcher cannot check whether the data furnished by the participants are true. There are several ways in which the limitations suffered by this project can be overcome. The results obtained through primary data sources can be tallied by examining them through the data reflected in existing literature. However, for this particular topic this method is not feasible since there is not much existing literature on this subject. Reliability of the data can be alternatively checked using the Cronchbach alfa analysis. Size of sample can also be increased to improve reliability of findings. References Bryman, A. and Bell, E., 2007. Business research methods. Oxford: Oxford University Press. Crotty, M., 1998. The Foundations of Social Research: Meaning and Perspective in the Research Process. London: SAGE. Hauge, A., Malmberg, A. and Power, D., 2009. The Spaces and Places of Swedish Fashion. European Planning Studies. Vol. 17, pt. 4, pp. 529-547. Inditex, n.d. Our Group. [online] Available at: [Accessed 11 March 2013]. Knox, S. (2004) Positioning and branding your organization. Journal of product and brand management. Vol. 13, pt. 2, pp. 105-115. McDaniel, C. D. and Gates, R. H., 1998. Marketing Research Essentials. Ohio: Taylor & Francis. McEachern, W. A. 2011. Economics: A Contemporary Introduction. Connecticut: Cengage Learning. MRS, 2010. Code of Conduct [pdf] Available at: [Accessed 13 March 2013]. Quantitative versus qualitative methods, 2007. European Commission. [online] Available at: [Accessed 11 March 2013]. Saunders, M., Lewis, P. and Thornhill, A., 2009. Research Methods for Business Students. England: Pearson Education. Smith, L. F., Gratz, Z. S. and Bousquet, S. G., 2008. The Art and Practice of Statistics. Belmont: Cengage Learning. Soloaga, P. D. and Monjo, M. (2010) Zara Case Study: The Company Where Everything Communicates. Harvard Deusto Marketing Y Ventas. 101, pp. 60-68. Watsham, T. J. and Parramore, K., 1997. Quantitative Methods in Finance. Connecticut: Cengage Learning EMEA. Zara, 2010. Company. [online] Available at: [Accessed 11 March 2013]. Appendix Figure: 1. Usage of technology helps in improving customer services (Source: As explained in text) Figure: 2. Method of sampling Figure: 3. Calculated value of t statistic Customers Serial Number Value of responses 1 1 2 3 3 2 4 5 5 2 6 3 7 5 8 5 9 5 10 4 11 4 12 4 13 3 14 4 15 5 16 3 17 4 18 2 19 4 20 5 21 2 22 4 23 4 24 2 25 5 26 5 27 5 28 4 29 5 30 4 31 4 32 5 33 4 34 5 35 5 36 4 37 5 38 4 39 5 40 4 41 4 42 4 43 4 44 4 45 5 46 4 47 5 48 5 49 5 50 4 51 4 52 4 53 5 54 4 55 5 56 4 57 5 58 4 59 5 60 5 61 4 62 4 63 4 64 4 65 4 66 2 67 4 68 4 69 4 70 4 71 4 72 5 73 5 74 4 75 4 76 4 77 5 78 4 79 4 80 4 81 5 82 4 83 5 84 4 85 5 86 4 87 5 88 4 89 5 90 4 91 5 92 5 93 4 94 4 95 4 96 4 97 4 98 5 99 4 100 4 416 N 100 Mean 4.16 Standard deviation 0.837504711 Calculated t value 1.910437014 Tabulated t value 1.6604 Read More