cross cultutal marketing strategies fashion mexico

Cross-cultural marketing strategies of Zara, H&M & Benetton in Mexico

BYAna Ballesteros González

Camille DezamisAlejandro Nieto

Assignment 3MG520 International Business Management

Jung Wan Lee, PH. D. Administrative Science Department Boston University

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1. Introduction

The textile sector is a crucial industry in Europe. It has grown enormously over the

last century. Many countries of the European Union consecrate many of their resources to the

textile industry. Italy produces 45% of all clothes made in the European Union. 24% of all

technical textiles made in Europe are produced in Germany. France ranks third in the EU total

textile and clothing turnover. Romania is the second largest employer in textile and fashion

sector in the EU. Spain is the second largest European exporter of clothes. As we observe,

many European countries have succeed internally in the textile sector. Our goal is to analyze

the performance of European companies overseas. We have chosen Mexico as our focus

market for many diverse reasons. Firstly, it is a pioneer country in South America. We know

that companies that  have historically succeed in Mexico tend to expand in all south America.

Secondly, the Mexican market is extremely recent. Zara and Benetton expanded to the federal

republic in the 1990s. H&M opened its first store in Mexico in 2012. Thirdly, we believe that

even if Mexico is nearly a fully developed country it still presents difficulties due to its

complex high context culture and differences of income level. Therefore, it will be revealing

to see how European companies are doing in such a different environment.

The European companies that we have selected are H&M, Zara and Benetton. The

three companies were formed in different countries and their cultural backgrounds are

different. We thought it would be interesting to compare the different strategies they have

chosen. We are aware of the fact that each firm has used a different marketing strategy to

impact and appeal Mexican customers. In addition, all the firms selected are part of the top 10

most successful European clothing retailers. Furthermore, we are inspired by the article

published by Greenpeace a few months ago. It stated that the three fashion companies are

proving that it is possible to ban all toxic chemicals from all steps of production and we want

to observe the impact it could cause in the performance of the firms.

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2. Literature Review

When a company wants to enter a new market it is essential that it studies in detail

every single aspect of the country. It must be taken into consideration that the controllable and

uncontrollable factors that a firm has to deal with vary from region to region and are key for

its success abroad.

Therefore, before making any international marketing decisions all factors must be

analyzed. First of all, once the company has its own controllable characteristics settled –

price, promotion, product and channels of distribution – and the company controls the

domestic environment – legal and political forces, competitive structure and economic

climate, it will be ready to start with the foreign environment.

A foreign environment will undoubtedly have similarities to the home market but

probably, differences will be even broader. Companies need to be aware of the uncontrollable

factors of that new country. On the one hand the legal situation and the regulations will

determine how hard it will be not only to settle there but also to accomplish daily activities.

The economic stability and economic forces are also really important to determine the

potential demand. On the other hand, the country’s geography and infrastructure linked to the

level of technology and distribution structure are major issues to be studied. (International

Marketing Book, 2013)

Finally – and what interests us the most for our research – the company must be aware of the

fact that culture plays a major role on the way people behave. It will determine if customers

go alone or in groups to stores, if they purchase by impulse or by need, if they buy more

online or in physical stores, etc.

We are aware that this initial research was already done by our companies a long time

ago before they settled into those countries. However, we believe that they must not be

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underestimated for their present and future as they are constantly changing and will determine

if the company’s characteristics must change or not.

In this paper our objective is to discover if these three global brands are using the same

type of strategies in a foreign common country and if their results are the same. May some of

the methods used more effective than others? Do they behave as global brands with a uniform

policy, portfolio and marketing mix? Is the level of acceptance the same for all of them in

Mexico?

Our first step will be to go one by one researching on the corporate culture and

marketing mix – 4 P’s – of Benetton, H&M and Zara. They have been present in the market

for a number of years now so they have had enough time to adapt as best as possible. The first

goal is to first compare their home activity versus their overseas activity.  Then, we will be

comparing them in order to extract conclusions from our findings.

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3. Methods

3.1 BENETTON GROUP – MEXICO

Benetton is an Italian firm founded in 1965 by the Benetton family and based in

Ponzano. It is the tenth largest European fashion retailer. In 2015, the company earned

revenues of 1,529 million euros. The company has greatly and constantly invested to enlarge

the brand through the entire world. Nowadays, it possesses more than 5000 stores employing

around 7700 individuals spread in more than 120 countries.

The Italian business started its expansion in Mexico around the 1990s. Today, there are more

than 360 stores in the federal republic spread through more than twenty cities, such as

Monterrey, Mexico city or Guadalajara. (Benetton group, 2016)

Benetton has implemented different strategies to enlarge its presence in Mexico. In

2008, the firm signed an agreement with Sears Mexico to expand United Color of Benetton in

the country. Benetton’s products would be sold in Sears stores around the country. The firm

aimed for acceleration in the success and development of its products in the country. As a

direct consequence of the agreement, the Italian company increased rapidly its presence in the

10th most populated country. (Expansion, 2008)

Product Strategy

Benetton is defined as an innovative, energetic and fashionable brand that offers

quality products. The combination of colors distinguishes the brand from competitors. It has a

refreshing, dynamic and unique style. Benetton core values are color, quality and comfort.  

United colors of Benetton provide goods to a large market. It provides stylish clothes for men,

women and kids. The products offered include knitwear, bottoms, tops, jackets and coats for

the three different lines. The company offers 102 new items per year. Furthermore, the firm

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has a broad range of products. There is line for high quality products made of cashmere,

products for special occasions, products made of quality organic fibre, products for babies and

many others. The European company uses raw materials that are durable and environmentally

friendly. In addition, Benetton sells masculine and feminine fragrances. (Benetton group,

2016)

Benetton’s managers consider Mexico a crucial market to expand. The main reasons

are the potential economic growth of the country and its young population. The “Instituto

Nacional de Estadística y Geografía” estimated that more than 50% of the population was less

than 30 years old in 2015. In addition, 25% of the society was aged between 15 and 29 years

old, which represent more than 30 million individuals. As a consequence, Mexico is a big and

interesting market for the firm. Benetton, due to its modern, energetic and flashy design, is

mostly focus on teenagers and young professionals. Younger generations tend to wear

colorful and remarkable clothes. (Expansion, 2008)

Furthermore, Luciano Benetton, the founder of the brand, also considered Mexico the

perfect place for United Colors of Benetton for its brightness. Mexico is a colorful country. It

is considered one of the shiniest and most multicolor places in the world. The display of

colors in traditional festivals and celebrations, such as Easter week, Day of the Dead or Feast

of Our Lady of Guadalupe is unique. The population of Mexico is certainly more used and

attracted to Benetton’s colorful style. It will have an easier adaptation and acceptance than in

other colder places, such as Eastern Europe because the contrast with the culture is less

remarkable.

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Price Strategy

United Colors of Benetton is considered a reasonable price firm. It has an extensive

range of products that comprise costly and economical products. Mexican consumers can find

t-shirts for as low as 180 Mexican pesos ($9), winter jackets for 600 Mexican pesos ($30) to 1

400 Mexican pesos ($70) and jeans, in average, for 900 Mexican pesos ($45 dollars).

Everyone is able to find the deal that fits them most. (Benetton, 2016) 

The Italian retailer main competitors are big multinational such as Zara, Mango, H&M

and Gap, and Mexican firms like Dafiti México, Andrea and Capa de Ozono. Most of the

competitors mentioned have competitive prices, and are also focused on young adults.

Benetton, to appeal consumers against competitors, offers interesting coupons and discounts

throughout the year. Some of them reach 50% of discount. In addition, shipping is free on

orders over $100 and the delivery deadline is fast, just 8 working days. (Mbaskool, 2016)

Place Strategy

Benetton is usually placed in crucial and strategic locations. The directors of the firm

choose generally historic town centers and shopping malls. United Colors of Benetton is

situated in the most important places in Mexico, such as Avenida Juarez and calle Venustiano

Carranza in Mexico City, Centro Comercial Angelópolis in Puebla and Avenida Rafael

Sanzio in Guadalajara.

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The United Colors of Benetton stores are colorful and attractive. The multicolor

collections present a pleasant and dynamic store that appeal customers.

In 2014, Benetton inaugurated the first “On Canvas” store in Milan. This new concept

of store symbolizes the evolution of identity and character of the Italian firm. It is

characterized for its wide, cozy, innovative and dynamic space. The product is the

protagonist. Customers participate in a unique experience of design and technology. (Rlreport,

2015)

In the past two years, Benetton has invested great quantities of money to open three

On Canvas stores in Mexico. They represent the first on canvas stores of Benetton out of

Europe. It shows the importance of the Mexican market for the Italian firm. The stores are

located in Puebla, Guadalajara and Antara. Their dimensions oscillate around the 400 square

meters.  

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Promotion Strategies

Benetton is a unique company in terms of advertising. Companies usually adapt their

advertising to the local culture. The Italian retailer has chosen to distribute a single and

universal message. The company doesn’t differentiate location, color of skin or language

spoken. The same message is valuable to everyone. It is very beneficial in Mexico due to its

diverse ethnicity. The largest ethnic group is the Mestizos. The indigenous population,

counting more than 56 indigenous groups, also represents a big proportion of the country.

(Benetton group, 2016)

In addition, Benetton introduced a new approach to advertising. It was a strategy that

many other firms avoided. The Italian company focused its ads on civil and social subjects,

situating the product in the background. Promoting freedom of speech or giving visibility to

humanitarian causes were common arguments of the ads. Benetton aimed to experiment and

anticipate. Its original and controversial promotional campaigns were visible and

controversial. Some of the most polemical ads include the pope embracing Ahmed

Mohammed el-Tayeb or Obama kissing the Chinese leader Hu Jintao. Mexican population’s

reaction was dubious. Part of the society believed the ads were too aggressive.

Furthermore, Benetton has always been a protector of the environment. In 2013,

Greenpeace recognize the cooperation of the Italian business with environmental causes.

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In addition, Benetton has promoted itself in different sports. It promoted an F1 team, a rugby

team and a basketball team. The firm’s goal is to share and incentive physical well-being

among younger generations. (Kirsten Brodde, 2016)

3.2 H&M - MEXICO

        Hennes and Mauritz, most commonly known as H&M, is a multinational clothing-

retail company created by Erling Persson in 1947. H&M was originally founded in Vasteras,

Sweden and was called “Hennes” which means “For Her” in Swedish. (Fashion United, 2012)

In 1968, Mr. E.Persson purchased Mauritz Widforss’ company that sold hunting

clothes for men and merged the two companies that give us “Hennes and Mauritz”. Since the

beginning of this fusion, the idea of the founder was to create a company that “sells a lot,

quick and cheap” products for men and women. This idea is still one of the core values of the

multinational brand. (Fashion United, 2012)

Since 1984, E. Persson’s son, Stephan Persson, took over the company and continues

what his dad began by growing the H&M empire even further. Nowadays, with a revenue of

$21.73 billion and more than 140 000 employees worldwide, H&M is one of the most trusted

apparel brands.  With more than 3 000 shops worldwide and 2 148 only in Europe and Russia,

H&M shops are unavoidable and present in all the main malls and shopping streets where the

customers would like to shop. With a minimum of 2 786 merchandises under its portfolio,

H&M always have a product to fit all the members of the family. They offer clothes for men,

women, children, make up & house decorations for all occasions and tastes. The Swedish

company is known to deliver to the customers fashion and stylish products at the cheapest

price. (Instant glamour, 2016)

     Nevertheless, H&M has a powerful market place on the European market and also on

the North American market. The Swedish brand sets is goal to increase 10 to 15 percent of the

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number of stores per year, and at the same time increase sales in comparable units.

(Anniesteph, 2013)

     It is the reason why they want to penetrate the Mexican market since 2012. Mexico is

a tough market and lots of H&M’s competitors failed to achieve their target goal. It is also a

market where they can reach lots of new customers and expand their business.

Product Strategy

H&M offers a large variety of products for all ages, gender and all occasions at a

cheap price. The Swedish brand sells clothes for men, women, children but also accessories,

makeup and house wear. They have products that fit all demands and adapted to all the

members of the family. The strength of H&M is to offer products that are inspired by the most

prestigious brands that means that the clothes are fashion, stylish, wearable and trendy but at a

cheaper price than the competitors. This statement goes with the slogan of the brand that is

"Fashion and quality at the best price". (Mooza Al Doser, 2016)

With two main collections per year identical in the 62 countries, H&M is a brand

where you feel secure and like home. The same main items are available everywhere to the

customers.

     Furthermore, the secret weapon of H&M is its flexibility: H&M adapts on real-time

the number and the design of items thanks to the feedback of customers & employees, and the

revenue earned on a specific product. The real-time design allows H&M to respond to the

market in a faster way and be more flexible in the eyes of the customer. (Jens Hansegard &

Niclas Rolander, 2014) It is the reason why if a customer goes to H&M is Mexico he might

not find all the same items he could find in Sweden for example. The brand tries to respond

the most they can to the demand and the taste of each country. Mexican and Sweden

customers might not have the same taste, same weather, same needs, so the collections are

unique for each country.

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     Finally, H&M is also well known for its collaborations. For few decades, H&M

decided to create partnership with high standard brands such as Stella McCartney in 2005,

Sonia Rykiel in 2009 or Balmain in 2015. (Steff Yotka, 2016) These collaborations are really

popular because they target the most popular segment of the brand: women between 20 to 27

years old. With nearly 40% of its population between 15 and 40 years old, Mexicans are

really receptive to this kind of initiatives. They consider this as an opportunity to have access

to high quality product for the cheapest price.  Moreover, fashion is an important business in

Mexico: lots of prestigious fashion designers, influencers and bloggers live there and their

visions have a significant impact on customer's decision. Mexicans are considered for H&M

to be a really receptive audience to new collections and collaborations. (Brandee Eisele, 2014)

Price Strategy

        H&M is well known as we saw for its slogan “Fashion and quality at the best price”.

H&M succeeds to offer to the customers a pricing strategy that fits all the different budgets,

but with a special care for the lowest budget. The brand strategy is to deliver to the customer

the best quality they can offer for the price they pay. Compare to its competitors such as Zara,

Gap, Benetton or Forever 21, H&M is always the one with the fairest balance price/quality.

(Brandee Eisele, 2014)

        However, the real question is how H&M succeeds to deliver products of quality with

such cheap prices? The answer is by reducing intermediaries in the whole process and

ordering on demand part of the collection. H&M does not own its own factories but works

with more than 850 independent suppliers. 80% of the inventory is pre-ordered and produced

mainly in Asia and will be the base of the main collection and the left 20% are produced in

Europe and are all the products adapted to the market demands in each countries. By using

this method, H&M reduces its costs and creates output more affordable to the customers.

(A.Yan, B.Mu, G.Sun, T.Liu, Y.Shen, 2014)

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        Moreover, I checked the prices of a same product on the Mexican H&M website and

on the other hand on the H&M Sweden website. Here is my founding:

         Both of the images above are the same product: an upper dress with the same materials,

design, etc. The price is obviously different because in Mexico the official money is Mexican

peso and in Sweden it is the Swedish krona. If we convert both of the prices we can see that

the Mexican dress costs $48,45 and the Swedish one costs $65.17 (H&M, 2016)

        Even though this example confirms the fact that H&M offers cheap dresses that look

good, we can see a difference of nearly $17. I did the test on few other articles available on

both websites and the results were always the same: the Swedish version was always more

expense by $10 to $30. The reason why a difference of price exists is because of the GDP per

inhabitant. In Mexico, the GDP per inhabitant in 2015 was $9 000 whereas in Sweden it was

$50 000. Because of the difference of GDP per inhabitant, the purchasing power is not equal

for both countries so the brand adapts the price to the country of delivery to keep their

products cheap.

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Place Strategy

     H&M is the second ranked retailer of clothing line in the whole world, available in

more than 62 countries with more than 3 000 shops worldwide. Let’s just say that if you are in

a big city in Europe or in the United States, on the main shopping street, you have huge

chances to find an H&M store. The main place strategy of the Swedish brand is to be located

on busy high-density streets and malls. (H&M, 2016)

        If we look at the map of Mexico below, we can see that the stores are always located

in big and touristic cities. A concentration of stores is available in the capital city since 2012

with the opening of three big stores in the borough of Santa Fé in Mexico City. The shops

measure 45 208 feet square and welcome thousands of customers each day. The most massive

store in Mexico is located in Guadalajara and measure more than 538 195 feet square.

(Carolina Manrique, 2015)

The other characteristic of H&M in terms of place strategy is their want to be visible

and attract customers to come in the shop even if they do not need anything. The visual aspect

of the storefront is always designed with plastic models to show different combinations of

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layers and new items available with a massive logo at the top. H&M boutiques can be

recognized really easily.

     Moreover, customers can shop all their favorite H&M items online thanks to their

website customized for each country they do business in. The language and the money

conversion are available and shipping is available in all countries. (H&M, 2016)

Promotion Strategy

        H&M uses an universal promotion strategy. The company does not create ad

campaigns based on the culture the ad will be delivered; there is no national campaign, but

only one worldwide campaign. The strategy is to create few promotion campaigns per year

but really valuable where the company presents new clothes of the collection. To be valuable,

noticeable and well received in all the countries they do business, H&M teams up with

famous models. For the past few years, David Beckham, Beyoncé, Vanessa Paradis, Madonna

or Kendall Jenner were the celebrities H&M developed partnerships to represent the brand.

(H&M, 2016)

Thanks to these well-known figures, the ad attracts lots of new customers, curious to

discover the ad with their favorite public figures is. These celebrities are known worldwide,

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so it would not be relevant for the brand to develop a national ad per country. A massive

multinational campaign is more powerful thanks to video clips available online and on TV,

big posters in the street and in the tube, pages in the magazines…

H&M also developed a lot its social medias to promote new collections, collaborations

and sales. To be more effective, they created customized pages for the different countries. In

the case of Mexico, Mexican have access to a Twitter, Instagram and Facebook accounts

especially for their country where they can find all relevant information they need.

3.3 ZARA - MEXICO

Amancio Ortega and his wife, Rosalía Mera, started their activity in the retail sector in

1963 and opened the first Zara store in 1975 in A Coruña, Spain. During the next few years

Zara achieved great success and kept on expanding its stores along other Spanish cities. Only

12 years after, in 1888, it entered the Portuguese market and in 1989, it opened its first store

in the United States. Zara’s global expansion kept on growing and developing new strategies

slowly but securely until today (Inditex, 2016).

With 1.923 stores in 88 countries, the company has become one of the biggest retail

stores in the world. Along with other successful brands such as Massimo Dutti, Bershka, Pull

and Bear, Stradivarius and Oysho, Zara belongs to the Inditex Group. It is famous for offering

all type of fashionable quality and affordable clothes and accessories. It has differentiated

product lines: Women, Men, TRF (young women), Kids and Home.

The group produces by consumer demand — manager communicate to the

headquarters which are the best selling items so larger quantities are produced — and it has

proven to be an expert in the so-called Fast Fashion. According to many scholars and

economists, that is one of the main factors for its success (Forbes, 2015). Zara makes sure that

trends pass by really fast by introducing new items and new styles in stores every two weeks

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— As a consequence, it encourages consumers to buy the “latest” items every month. But,

how can it be so fast?

Inditex has developed a new system that allows stores to receive, send and replace its

items fast enough to cover demand and reach and surpass consumer expectations. In addition,

the group has its own factories near its distribution centers which are located Spain.

Therefore, the higher costs of the production —producing in Morocco is more expensive than

in China— are compensated with the speed and flexibility closeness provides. (International

Marketing Book, 2016)

Product Strategies

Zara’s strategy is letting the consumer choose the products he wants, how and when he

wants them and then, producing accordingly. It believes that doing it the other way around is

old fashioned and does not give results.

In order to achieve that, Zara stocks as less inventory as possible and updates its

collections very often. What is more characteristic is the way it launches new collections.

First of all, when Zara creates a new collection, it sends very few items to its stores waiting

for feedback. Store managers are trained to determine what people like and dislike about those

items. Everyday they send reports to the headquarters in Arteixo, Spain informing of the

comments clients have made about the different items — simple information such as “I don’t

like this zippers” or “this colours is too pale” is extremely relevant. Right after, in-house

designers will remake the designs that will be sent again to the factories and from there to

stores.

This is a never ending learning process that allows the firm easily discard “loser”

items and improve and potentialize “winner” ones. (The New York Times magazine, 2012)

As a consequence, production is done in small amounts and stock levels are never too high.

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This production model is key for the firm’s worldwide survival. Zara is aware of the

differences of consumption and needs in every country and it considers that best way to reach

consumers expectations and to cover their needs is to listen to them. It knows that several

products may be a worldwide success, some will be a complete failure in Europe but a hit in

Mexico and some will not work at all. Therefore, some Zara products will be common in

every country and others will be unique for some determined markets.

In addition, the fact that so many different products come in and out of stores every

week only emphasizes the urge of consumers to buy before that item they like will be sold

out. This is a big advantage over other specialty retailers such as Abercrombie and Fitch and

American Eagle or even over high-end fashion companies who used to create two or three

collections per year and who have had to move towards six to compete against Zara (Business

Insider, 2015)

This strategy is really uniform worldwide. As a consequence, we can see that in

Mexico the products are mostly the same as the ones offered in the Spanish online store. The

climate is similar and the culture in terms of fashion is a little bit alike. The biggest

differences are found in the bags section, while the Spanish bags are mostly functional the

Mexican ones are more “decorative” and elegant. (Zara Online Store, 2016)

Price Strategies

Inditex main pricing strategy is listening. It studies every market characteristics and

sets its prices according to what consumers will be willing to pay. The main factor to take into

consideration is the income level of the target market; once it is determined, Zara’s pricing

flexibility allows it to adjust its prices and remain on the lead of the fast fashion industry.

(Fashion Network, 2015)

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The prices are set in order be considered affordable — not too cheap, but not too expensive —

by consumers of every market. Apparently, maintaining such a uniform brand image requires

huge price variances.

A study carried out by the Morgan Stanley Bank in collaboration with AlphaWise

revealed the differences of price among the products — exactly the same items —that Zara

sells in every country. Spain was given the number 100 and taken as a reference to compare

all the results of the other countries.

The figures show that Zara was around 24% more expensive in France, Italy and

Germany than in Spain; a 50% more in England and Mexico; more than a 75% in Russia and

China and around a 100% more expensive in the United States and South Korea. (El

Confidencial, 2015). Therefore, if you live in Boston and love a Zara dress you must be aware

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that you’ll pay twice what a person at a Zara’s store in Barcelona is paying at that exact

moment for the exact same pink dress.

Of course, another reason behind the higher prices overseas is that the firm needs to

cover the shipping costs, taxes and regulations. However, even then, the profit Zara gets by

selling products abroad is  huge. In Mexico, Zara is doing well. Even if prices are higher than

in Spain, it is still considered to be a classy and quality brand with affordable products that

can suit women and men of all ages. People consider those prices average and are as willing

to pay for them as Spanish consumers.

Analysts claim to be amazed by Pablo Isla’s, president and CEO of Inditex, strategies

and way to guide the company towards a exceptional growth rates yet there are still many

obstacles to bypass.

A big threat for the company’s price strategy is the European Union new regulation

that looks towards a price homogenization of the European e-commerce. In addition, the

online visibility of prices lets consumers be aware of these huge price variances and may lead

to distrust. (El Confidencial, 2015)

Place Strategies

Zara physical stores are present in many countries around the world  and its online

stores are available in more than half of them. The firm’s intelligent way to choose its

locations has been determining in its success.

Right from its first years Zara has always opened stores in key locations with great

visibility and affluence of people. First in A Coruña, then in Madrid and so forth until arriving

to New York’s Fifth Avenue or London’s. Basically Zara is famous for loving interesting

buildings, buying them and creating high-end stores with a luxury atmosphere.

The quantity of stores it has depends on the demand of the country and city (The New

York Times Magazine, 2012). In most of the cities of Spain it is very easy to find at least one

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or two Zara stores per neighbourhood and always one in each shopping mall. Demand is

really high in its country of origin. On the other hand, in Mexico the number of stores is way

lower. More precisely 59 stores in Mexico versus more than 450 stores in Spain. Convenience

is, as a consequence, higher in Spain but probably the exclusivity is higher in Mexico. The

main common aspect among the placing strategies in both countries is that every store of both

countries is located in a key street that is relevant for its prosperity. But is an extra similarity:

in Arteixo expert window dressers recreate the streets of Mexico and of Spain and decide how

the window displays will look in each location in order to be appealing for consumers. The

main goal of Zara is to transmit the same feeling of class and novelty no matter in which part

of the world the store is. (International Marketing Book, 2013)

Promotion Strategies

Zara is famous because it has earned very high levels of brand recognition and brand

awareness without spending large amounts of money in promotion. Many brands claim that

their highest costs come from marketing. However, since the beginning, Zara has followed a

“Zero Marketing Investment” policy. (Marketing 91, 2016)

The company has a unified worldwide strategy. They believe that people must choose

what to think about them and how to talk about them. They offer a service and then, wait for

people to comment about it and to recommend it if they liked it. Apparently it works great.

You can talk to a girl from Monterrey, Mexico and she will tell you she loves Zara and then

you will talk to a boy from Seville, Spain and will claim that yesterday sales in Zara were

great. None of them has ever seen a print ad with Zara’s new collection, a TV commercial

with a classy girl on it, a radio ad informing of upcoming sales nor a single pop up ad while

scrolling down in their Facebook profiles.

Word to mouth is an excellent way to become well known and it’s especially effective

in collectivistic countries such as Mexico.

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4. Results and Findings

After having analyzed Benetton, H&M and Zara businesses in Mexico we would like

to compare their international marketing strategies. Therefore, in the following section we are

going to develop in detail their common and different approaches of the Mexican market that

is distinct from their country of origin thanks to the 4P’s analysis.

In terms of product strategy, these three multinational brands do not have the same

way to precede even if they produce the same output: clothes for men, women and children

that are wearable, fashionable and comfortable for the same target audience: people between

20 and 40 years old. H&M and Zara are quite similar by adapting the production to the

demand of the Mexican tastes and wants in real-time (called “fast fashion”) whereas Benetton

only has a worldwide production strategy with two collections per year.

About the price strategy, the three European companies that we analyzed do not use

the same strategy even if they are all affordable clothing retailers. While Benetton does not

adapt its prices to Mexico but only convert its prices to Mexican peso, H&M and Zara adapt

their prices. H&M decided to adapt their price according to the GDP per inhabitant of Mexico

so the prices are less expensive in this newly developed country whereas Zara applies a 50%

price variation on articles. Theses three multinational brands keep their goods affordable to

Mexico but use a different approach to penetrate the market.

Moving on to the place strategy, H&M, Benetton and Zara have a similar procedure.

Their tactic is to be located in key locations of big, busy and touristic cities where the

customers do shopping. Their idea is to attract people in their shop even if they did not need

to consume anything, but work on their curiosity thanks to a good storefront and high-end

looking store’s atmosphere. Whereas H&M and Zara have created online website especially

for Mexican customers with their language and their money, Benetton did not do so and no

Mexican online store is available.

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Finally the promotion strategy is really different for the three companies. Zara has for

policy to do not use advertising but only count on word of mouth, whereas H&M and

Benetton count on powerful advertising campaigns. On one hand, H&M teams up with

important celebrities to be their brand ambassador. Lots of new customers are curious to

discover the ad and the collection their favorite star represents. On the other hand, Benetton

creates non conservative and unusual campaigns that are powerful. Thanks to this “shocking”

ad policies, people talk a lot about the brand.

A sum up of the information explained above can be seen in the chart below:

Benetton H&M Zara Similarities Differences

Product Quality, colorful and comfortable products offered worldwide, no product adaptation to Mexico.Two main collections per year

Clothes inspired from high-end brands.Two main collections per year and the 20% of them is adapted to Mexico.Collaborations with high-end designers.

Clothes that are fashionable and good quality. Two collections per month. Production is determined by demand

Offer quality clothes and fashionable clothes designed for the same target group (women between 20 and 45 years old)

Level of adaptation to Mexico. Benetton has a uniform worldwide collection. H&M varies slightly to cover Mexican consumer’s needs/wants and Zara adapts completely to Mexican consumers likes and dislikes.

Price The price is not adapted to Mexico, simply converted from country of origin

Cheaper than the home country and than competitors.Price is adapted to the GDP per inhabitant of Mexico

Big price variation (50%) to maintain the same brand perception than in the home country (affordable brand).

Affordable prices.

Benetton has the highest prices, Zara is in the middle and H&M offers the cheapest products.In addition Benetton doesn’t adapt its price to Mexico

Place Key locations in big and touristic cities

Key locations in big and touristic cities and online mexican store

Key locations in big and touristic cities and online mexican store

Stylish, clean and high-end looking store’s atmosphere.

Benetton does not have an online store in Mexico while Zara and H&M do.

Promotion

Worldwide advertising campaigns that are not designed to fit the Mexican

Worldwide advertising campaigns that are not designed to fit the

None. No promotion adaption to Mexico but worldwide campaign that

Zara does not have any type of marketing while Benetton and H&M do.

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culture.Campaigns are really  innovative and powerful.

Mexican culture.Use of famous brand ambassador.

fits all the countries.

In addition, Benetton campaigns tend not to be really conservative and formal. H&M creates promotion to attract new customers thanks to famous worldwide influencers

5. Conclusion

The analysis about the cross cultural marketing strategies of three European

multinational clothing fashion brands have shown us that different strategies are valuable to

expand to the Mexican market.

Zara, a Spanish company, adapts to the Mexican consumers. It produces clothes

according to their wants and needs. In addition, the Spanish multinational readjust the prices

to make them affordable to Mexican customers. Zara’s strategy is to locate in crucial areas of

big and touristic cities. It’s its main way to promote itself.

On the other side, Benetton and H&M use worldwide advertising to promote their

brands in Mexico. Furthermore, Benetton has a uniform worldwide collection that is renewed

twice a year, while H&M has 80% of its collection fix and 20% of its collection available to

be adapt to the Mexican market such as Zara strategy.

In this paper we figure it out that there is not a specific cross cultural marketing strategy that

is more efficient than another because these three European brands do terribly well in another

market than they countries of origin. These strategies have their own advantages and

disadvantages but the most important thing is that they are respectful of the core values of

each brands and to the customers.

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6. References

- Benetton

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- Zara

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