ZARA AI Stylist — Marketing Campaign Idea

Introduction:

Zara, as a node, is one of the biggest international fashion companies, and it belongs to Inditex, one of the world’s largest distribution groups. Zara is a Spanish clothing retailer based in Galicia, Spain, and a Spanish fast fashion retailer brand. It is focused on design, production, distribution, and sales through its extensive retail network. Zara has 3 partners, 1 is a technology partner, and 2 are channel partners. Owler is its most significant channel partner.

AI-Powered Marketing Campaign:

Zara faces tough competition from Shein, an online brand. Their market share has drastically been challenged. According to The Wall Street Journal, a recent fundraising round reportedly valued Shein at $100 billion, far ahead of its main competitors H&M and Inditex, the parent company of Zara. The retailer, which targets a young audience, seduces not only with its low prices but also by the number of new items available daily on its platform, accessible in no less than 150 countries worldwide as its business model is online only. Zara is also facing 3 significant challenges:- e-commerce, competition, and sustainability.
Zara is still a place for working professionals and students to shop and look for trending clothes. Sadly in the last few years, they have seen a decline in sales. I am proposing an AI Marketing campaign to retain existing customers and drive sales. Zara is already selling clothes online to their customers; they can incorporate an AI Stylist that will do the following roles:
a. Understand customer body type and style taste
b. Suggest and recommend Zara outfits, shoes, and jewelry and how to bring a look together
c. Learn the likes and dislikes of the customer based on the customer feedback
d. Keep improving the model to suggest clothes customers would like and reduce returns.
e. Use AI to personalize individual consumer preferences.
Work on the customer budget; that way Zara can not only bring this innovative tech feature but will be able to increase sales, reduce returns and get customers hooked for the long term as they will learn to depend on the AI stylist to suggest clothes to buy and wear. The Role of the channel partner is to find a way to tap into walking customers in each retail store and get them introduced to the AI stylist tool.

Identify the Data:

Zara has Online and offline cloth retail businesses in the current model. They sell clothes to customers and give an option to customers to return clothes within 30 days if they don’t like the fit or style.
a. Data the node likely has based on its current business model are Website traffic date, search engine, types of clothes sold more or less, demographics and location of customers, and website browsing pattern.
b. They acquire this data from their website and mobile website, and they might get more info from sales and social media.
c. First-party data is website data and surveys, while third-party data would be data from retail sales, google searches, and other social media platforms.
d. Zara needs to collect direct data from consumers in its current model. They need help understanding why specific categories of clothes don’t sell, why customers are returning purchased clothes, and in what volume.

Propose a New Business Model:

Build an AI model that will understand customers and suggest clothes and styles that will look good on them based on their body type, updated fashion trends, and current weather conditions of the customer’s location or travel location.
a. Through this new business model, they will capture consumers’ likes and preferences and collect feedback on their latest designs and pricing. They will get to know their customers personally and curate clothes that fit them, and they can predict trends and create clothes that most likely sell and reduce returns.

b. Implementation of the marketing campaign:

• Launch the beta version of Zara AI Stylist feature.
• Invite some Kols on IG to sign up and start using it and promote it.
• Have a few invites that the kols can give to their fans with which they can sign up for the AI Stylist for a 50% discount.
• After a few months of usage, ask the kols and beta users to share their Zara AI Stylist experience and share pics of the outfits styled by the Zara AI model.
• Launch a yearly subscription model inviting customers of Zara to use the AI features and take advantage of them.

c. Role of the channel partner is to promote and give them a short demo of the Zara AI Stylist feature to all in-store walk-in customers. One target would be getting more customers to sign up for the yearly subscription.

d. Zara can take great advantage of their current existing network. They can use social media platforms, channel partners, and supply chain partners to predict trends and forecast sales accurately. They can work with other partners in high-quality sourcing products and ensure clothes are more used sustainability. They can also collaborate with other luxury fashion brands and drive high-end fashion-conscious customers to their platform. As the Zara AI Stylist becomes mature, it can start a B2B business wing and offer these tech services to brands that might not have a conflict of interest with them.