Being the flavor of the month is often frowned upon in design, but for the Spanish fast-fashion retailer Zara, it’s a goldmine.
In an industry where thorough trend forecasting is the norm and designers often think multiple seasons ahead, Zara flies by the seat of its pants. And this approach seems to be working. Its parent company–Inditex SA, the world’s biggest fashion retailer by sales, as the Wall Street Journal reports today–believes keeping its ear to the ground, listening to what customers want right now, and delivering quickly is a better business strategy than gambling on what trends will be months down the road. For example, it brought a coat from design to retail in just 25 days. As Inditex Chairman and Chief Executive Officer Pablo Isla tells the WSJ:
Since the beginning, the idea has been to understand what the customer wants first and then have an integrated manufacturing and logistics system to be able to deliver it to them quickly.
This model relies less on formal marketing reports and sales figures to drive design decisions and instead relies on observational research. At the center of that strategy are Zara’s store managers, who listen to what customers are requesting and looking for on their racks–and relay that intel to the company’s HQ in Arteixo, Spain. These managers are sometimes even flown in to consult. Realistically, Zara’s thinking goes, store managers who watch a steady parade of fashionable customers in their stores are better equipped to know what’s cool than some marketing VP holed up in their offices.
In the case study the WSJ tracked, a coat with expressive hardware was under development. Store managers, designers, and commercialization teams all worked closely, in the same office, to develop a concept. Then, pattern makers quickly prototyped a garment that spoke to the trend. It took them just five days to come up with a design. Then, manufacturers in the town made 8,000 coats in 13 days. Zara sent them to its logistics center in Zaragoza, Spain, then trucked them to the Barcelona airport. Within 24 hours, they arrived to JFK and were sent to a store on Fifth Avenue. Customers could buy the flavor of the month in less than a month’s time. To compel shoppers to buy the garment, which retails for $189, the store emphasizes that only a certain number have been made.
Zara manufactures 60% of its clothes close to its headquarters, which allows it to slash product development times since there aren’t as many logistical hurdles posed by distance between designers and manufacturers. H&M, one of its competitors, still does the bulk of its production in Asia and orders 80% of its garments months in advance.
Anne Critchlow, an analyst at the investment firm Société Générale, told the Wall Street Journal:
Simply put, the reason for Inditex’s success is short lead times: the ability to offer designs to the customer that other retailers do not yet have . . . Think of Zara not as a brand, but as a very speedy chameleon that adapts instantly to fashion trends.
Fashion has always been trend based, but now the cycle is accelerating thanks to fashion bloggers who can take pieces viral overnight. Brands that are able to respond quickly will be able to tap into those overnight trends. The old design, manufacturing, and distribution model in which each step is siloed and remote can’t keep pace.
Meanwhile, runway designers–who show clothes one full season ahead of retail–are also upending the way they do business. Rebecca Minkoff is changing its fashion week model by showing outfits that are available to customers immediately. In a game of who can sell what customers want the quickest, even the fastest fashion retailers can’t keep up with Zara.