{"id":433,"date":"2015-09-13T18:01:32","date_gmt":"2015-09-13T22:01:32","guid":{"rendered":"https:\/\/digital.hbs.edu\/platform-digit\/submission\/fast-fashion-ftwfor-the-win-how-zara-and-fast-fashion-retailers-are-rapidly-changing-the-game-with-technologyand-making-the-rules\/"},"modified":"2015-10-19T18:03:20","modified_gmt":"2015-10-19T22:03:20","slug":"fast-fashion-ftwfor-the-win-how-zara-and-fast-fashion-retailers-are-rapidly-changing-the-game-with-technologyand-making-the-rules","status":"publish","type":"hck-submission","link":"https:\/\/d3.harvard.edu\/platform-digit\/submission\/fast-fashion-ftwfor-the-win-how-zara-and-fast-fashion-retailers-are-rapidly-changing-the-game-with-technologyand-making-the-rules\/","title":{"rendered":"Fast Fashion FTW(For the Win): How Zara and Fast-Fashion Retailers are Rapidly Changing the Game with Technology\u2026and Making the Rules"},"content":{"rendered":"<p><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter\" src=\"http:\/\/www.provocateur-media.com\/wp-content\/uploads\/2012\/11\/zz.jpeg\" alt=\"\" width=\"450\" height=\"300\" \/><\/p>\n<p>When I first moved to Boston 11 years for College, I had a ritual every Friday after class with some of my fellow dorm mates: head to Filene\u2019s Basement in Downtown Crossing for somewhat stylish, affordable clothing friendly to the budget of a college freshman who had yet to earn her first real paycheck. Mind you, these significant markdowns were items that had gone way out of season or were being liquidated due to poor selling rates, imperfections, etc. However, our ritual soon came to an end when the store shuttered its doors for good.<\/p>\n<p>Fast-forward to Fall 2015, and to say things have changed would be an understatement. Recently, I visited the site as I learned a new store had finally been built in its place: Primark, as fast-fashion retailer. The prices are as rock-bottom as of those in Filene\u2019s Basement; however, in contrast, these low-priced items featured mirrored what\u2019s currently hot and trendy\u2014not liquidated has-beens. The replacement of Filene\u2019s\/Filene\u2019s Basement with Primark is symbolic of what has been taking place in the world of apparel retail: where large department stores once dominated, many have been shuttered to make way for fast-fashion retailers liks of Primark, Forever 21, and Zara. With <a href=\"http:\/\/www.forbes.com\/sites\/danschawbel\/2015\/01\/20\/10-new-findings-about-the-millennial-consumer\/\">$200Billion in buying power<\/a> in the U.S. alone, Millennials worldwide seek to scoop up the latest trends, exercise value-consciousness in splurging on desirable items, and share their finds\/opinions online\u2014and fast-fashion retailers are here to do deliver.<\/p>\n<p>When I first moved to Boston 11 years for College, I had a ritual every Friday after class with some of my fellow dorm mates: head to Filene\u2019s Basement in Downtown Crossing for somewhat stylish, affordable clothing friendly to the budget of a college freshman who had yet to earn her first real paycheck. Mind you, these significant markdowns were items that had gone way out of season or were being liquidated due to poor selling rates, imperfections, etc. However, our ritual soon came to an end when the store shuttered its doors for good 4 years later.<\/p>\n<p>Fast-forward to Fall 2015, and to say things have changed would be an understatement. Recently, I visited the site as I learned a new store had finally been built in its place: Primark, as fast-fashion retailer. The prices are as rock-bottom as of those in Filene\u2019s Basement; however, in contrast, these low-priced items featured mirrored what\u2019s currently hot and trendy\u2014not liquidated has-beens. The replacement of Filene\u2019s\/Filene\u2019s Basement with Primark is symbolic of what has been taking place in the world of apparel retail: where large department stores once dominated, many have been shuttered to make way for fast-fashion retailers liks of Primark, Forever 21, and Zara. With <a href=\"http:\/\/www.forbes.com\/sites\/danschawbel\/2015\/01\/20\/10-new-findings-about-the-millennial-consumer\/\">$200Billion in buying power<\/a> in the U.S. alone, Millennials worldwide seek to scoop up the latest trends, exercise value-consciousness in splurging on desirable items, and share their finds\/opinions online\u2014and fast-fashion retailers are here to do deliver.<\/p>\n<p>Zara boasted about $<a href=\"http:\/\/www.forbes.com\/sites\/walterloeb\/2015\/03\/30\/zara-leads-in-fast-fashion\/\">19.4B in sales last year<\/a> alone and operates over 1900 stores in 88 countries. The secret sauce to its ability to meet consumer demand for frequently stocked, affordable, trendy clothing lies in the technology used in its vertically-integrated supply chain.\u00a0\u00a0 Imitating the runway\u2019s hottest looks and selling them inexpensively (and of decent quality) in high-end store formats, Zara\u2019s parent company Indetix has a data-centric, sophisticated business model.<\/p>\n<p><a href=\"https:\/\/d3.harvard.edu\/platform-digit\/wp-content\/uploads\/sites\/2\/2015\/09\/Zara-Factory-.png\"><img loading=\"lazy\" decoding=\"async\" class=\"size-medium wp-image-428 aligncenter\" src=\"https:\/\/d3.harvard.edu\/platform-digit\/wp-content\/uploads\/sites\/2\/2015\/09\/Zara-Factory--300x216.png\" alt=\"Zara Factory\" width=\"300\" height=\"216\" srcset=\"https:\/\/d3.harvard.edu\/platform-digit\/wp-content\/uploads\/sites\/2\/2015\/09\/Zara-Factory--300x216.png 300w, https:\/\/d3.harvard.edu\/platform-digit\/wp-content\/uploads\/sites\/2\/2015\/09\/Zara-Factory--600x432.png 600w, https:\/\/d3.harvard.edu\/platform-digit\/wp-content\/uploads\/sites\/2\/2015\/09\/Zara-Factory-.png 694w\" sizes=\"auto, (max-width: 300px) 100vw, 300px\" \/><\/a><\/p>\n<p>Each Zara store <a href=\"http:\/\/www.nytimes.com\/2012\/11\/11\/magazine\/how-zara-grew-into-the-worlds-largest-fashion-retailer.html\">analyzes real-time sales information<\/a> based on daily sales patterns and customer feedback (e.g., sales clerks are trained to monitor customers\u2019 reactions to products and product features), reporting this information back electronically to headquarters. \u00a0Subsequently, a team of in-house designers uses this feedback to quickly tweak and develop new designs frequently, learning what sells and doesn\u2019t sell well and better customizing tastes to specific market locations and stores. Most of Zara\u2019s factories are located close to company headquarters.\u00a0\u00a0 Items considered \u201cin\u201d or \u201ctrendy\u201d are made closest to the target market to minimize production time (only 2-3 weeks compared to industry standard of 6 months) and subsequent delivery on the shelves.<\/p>\n<p>With this sophisticated real-time feedback and supply chain system, Zara is able to produce an in-store experience specific to market tastes that offers a wide variety of items. Consequently, while competitors may make on average 2,000-4,000 items annually, Zara can produce over 11,000 distinct items per year while carrying very little leftover stock (and subsequently keeping inventory carrying costs on the lower side). Such high turnover of desirable merchandise encourages frequent repeat visits and impulse purchases due to relatively low price and the prospect that a desired item may become unavailable soon\u2014so Zara gets to keep bringing in revenues through high traffic, and consumers get their fix of new fashion finds with each visit.<\/p>\n<p>Of note, Zara has increasingly been leveraging <a href=\"http:\/\/www.wsj.com\/articles\/at-zara-fast-fashion-meets-smarter-inventory-1410884519\">special chips<\/a> in its merchandise to improve the consumer in-store experience. When a particular item is rung up at the register, an automated order to the stock room is communicated to bring out a similar item. If a customer can\u2019t find a particular item of interest, a sales clerk can scan the item\u2019s barcode with an iOS app to bring up a list of close substitutes in the store or pinpoint nearby stores that have the item of interest in stock.\u00a0\u00a0 In the increasingly digital world of Milennials, shoppers can also use the <a href=\"https:\/\/www.google.com\/webhp?sourceid=chrome-instant&amp;ion=1&amp;espv=2&amp;ie=UTF-8#q=zara+app&amp;tbm=nws\">Zara app<\/a> to shop and locate items of interest.<\/p>\n<p>Traditional retails have also sought to capitalize on the increasing demand for fast-fashion items and have been strategizing accordingly (e.g., <a href=\"http:\/\/www.thestreet.com\/story\/13283364\/1\/j-c-penney-going-up-against-fast-fashion-powerhouses-h-m-and-forever-21-with-new-brand.html\">JC Penney\u2019s<\/a>). As retailers increasingly adopt fast fashion models, technological advances are critical in connecting with retail consumers and delivering what they want how they what it and when they want it&#8211;quickly.<\/p>\n<p>&nbsp;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Zara and fast fashion retail giants leverage technology and real-time data to serve up a winning formula<\/p>\n","protected":false},"author":76,"featured_media":0,"comment_status":"open","ping_status":"closed","template":"","categories":[180],"class_list":["post-433","hck-submission","type-hck-submission","status-publish","hentry","category-shopping-retail-apps-fastfashion-zara-forever21-technology-supplychain-milennials-shopping"],"connected_submission_link":"https:\/\/d3.harvard.edu\/platform-digit\/assignment\/digital-winners-and-losers\/","yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.3 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Fast Fashion FTW(For the Win): How Zara and Fast-Fashion Retailers are Rapidly Changing the Game with Technology\u2026and Making the Rules - Digital Innovation and Transformation<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/d3.harvard.edu\/platform-digit\/submission\/fast-fashion-ftwfor-the-win-how-zara-and-fast-fashion-retailers-are-rapidly-changing-the-game-with-technologyand-making-the-rules\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Fast Fashion FTW(For the Win): How Zara and Fast-Fashion Retailers are Rapidly Changing the Game with Technology\u2026and Making the Rules - Digital Innovation and Transformation\" \/>\n<meta property=\"og:description\" content=\"Zara and fast fashion retail giants leverage technology and real-time data to serve up a winning formula\" \/>\n<meta property=\"og:url\" content=\"https:\/\/d3.harvard.edu\/platform-digit\/submission\/fast-fashion-ftwfor-the-win-how-zara-and-fast-fashion-retailers-are-rapidly-changing-the-game-with-technologyand-making-the-rules\/\" \/>\n<meta property=\"og:site_name\" content=\"Digital Innovation and Transformation\" \/>\n<meta property=\"article:modified_time\" content=\"2015-10-19T22:03:20+00:00\" \/>\n<meta property=\"og:image\" content=\"http:\/\/www.provocateur-media.com\/wp-content\/uploads\/2012\/11\/zz.jpeg\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data1\" content=\"5 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\\\/\\\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\\\/\\\/d3.harvard.edu\\\/platform-digit\\\/submission\\\/fast-fashion-ftwfor-the-win-how-zara-and-fast-fashion-retailers-are-rapidly-changing-the-game-with-technologyand-making-the-rules\\\/\",\"url\":\"https:\\\/\\\/d3.harvard.edu\\\/platform-digit\\\/submission\\\/fast-fashion-ftwfor-the-win-how-zara-and-fast-fashion-retailers-are-rapidly-changing-the-game-with-technologyand-making-the-rules\\\/\",\"name\":\"Fast Fashion FTW(For the Win): How Zara and Fast-Fashion Retailers are Rapidly Changing the Game with Technology\u2026and Making the Rules - 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