2. ERLING PERSSON
Founder of
EST. In 1947
Hennes & Mauritz AB
Existence-62 Countries
Over 4000 Stores globally
“ Fashion & Quality at the best price”
9 Stores in India
2
4. Store Design & Store Layout
RETAIL STORE ONLINE STORE
Store Front :
-Shows some outfits & designs in the
store
-Informs about Big season Sale
Store Layout:
-Free flow layout
-Easy to find clothes
Web Front :
-Shows many outfits
-Shows different categories
-Shows big mid-season sales
4
5. MERCHANDISING PHILOSPHY AT H & M
Must reflect the target market
It consist of the activities involved in acquiring particular
goods and services and making them available at the right
place, time, prices, and quantities that enables a retailer to
reach its goals
Retailer needs to decide-Breadth of
assortment(NARROW/WIDE),Depth of
assortment(Deep/Shallow),Quality of
assortment(high/med/low),Store Brands or National Brands,
Pricing policies
5
6. MERCHANDISE MIX AT H & M
The right mix of modern basics, current
fashion and latest trends.
A varied range that inspires customers to
both browse and shop
Each store has the right stock of right
pieces.
Flexible assortment planning ensures that
each store’s selection feels
6
24. ASSORTMENT DEPTH & WIDTH ANALYSIS
PRODUCT DEPTH
PRODUCT WIDTH
Many products in
every product line
Many product lines
in every category
HAS NARROW & DEEP ASSORTMENT 24
26. THE MARKETING MIX
Classified as a brand that offers
homogenous shopping products
Up To date with the latest fashion trends,
through a dedicated team in Sweden,
coordinating with Delhi office
A collection often debuts between the
growth stage and the maturity stage, i.e.
collection is debuted beginning of every
quarter
PRODUCT
26
27. PROMOTION
H&M’s target customers are young women who
want more fashion cloth at low price
A blog written by Miss. Malini prior to store
launch
A multi-channel promotion strategy -
advertising, internet promotion, sales
promotion was adapted by H&M as well as
promotion through youth icons
Yearly competition inviting designer
students aged b/w 19-25.
27
28. PLACE
Distribution channel is direct distribution, from
producer to customers. By cutting middle
transaction, it reduces cost and assures quick
delivery
Design clothes and outsources it to developing
countries, for example: Basic goods are made in
Asia, while fashionable goods are made in Turkey
Does not have any franchise stores
H&M logistics focused on simplicity, reliability
and transparency
28
29. 29
RECOMMENDATION: “THE MODEL EFFECT”
Products and Services: Implementation of a Loyalty program,
can be signed up through website and mobile app.
Promotion: Development of a new page called “THE
COMMUNITY FORUM”, integration with social media.
Place/Process: Trial period of 6 months with an option to
integrate with current loyalty programme in India
Presentation: Development of a new page on the website,
hyperlinked to the forum page, also integrated with Facebook &
Twitter
30. 30
Campaigns and designer collaborations
H&M Designer collaborations
2006: Viktor & Rolf
2007: Roberto Cavalli
2008: Rei Kawakubo and Comme des Garçons
2009: Matthew Williamson, Jimmy Choo, Sonia Rykiel
2010: Sonia Rykiel, Lanvin
2011: Versace
2012: Versace, Marni, Maison Martin Margiela
2013: Isabel Marant
2014: Alexander Wang
Style icon
collaborations
2006: Madonna
2007:
Madonna, Kylie
Minogue
2012: David
Beckham
2012: Anna
Dello Russo
2013: Beyoncé
32. PRICING STRATEGY
32
The price strategy of H&M is designed based on their
customers needs which is low price and high fashion. In
fact, this is the one of the biggest challenges for H&M. If
not making this happen, the special feature of H&M
cannot be realized. How could they combine fashion and
cheapness?
Few middlemen.
Buying in large volumes.
Having a broad in-depth knowledge of design.
Being cost-conscious at every stage.
Having efficient distribution.
34. 34
The Recently launched Market
Report, which looks at H&M’s
global expansion strategy, uncovers
the three fundamentals of retail –
having the right product,
at the right price and
at the right time. When retailers
align these, they’ve struck upon
the golden formula of retailing.
Today, we take a closer look at the
second fundamental: how to set
the right price for your product and
win globally.
35. 35
This objective was achieved in two steps:
First, H&M outsources the production to countries
where the labor cost is much lower. To control
transportation cost, outsourcing was arranged
according to different product. Those high fashion
product which target at the European market were
produced in Turkey, because of the short product
life cycle. In addition, basic product are produced in
Asia because they allow longer transportation time
and bear lower risk.
Second, the company also conduct strict cost
control plan. For example, very few executives have
secretaries or have cell-phone privilege (Jobber,
2007). These two steps allow H&M to achieve a low
price fashion business
36. 36
Although H&M's low price
is the foundation of
success, the low price also
give H&M a image of bad
quality. This image hinders
H&M from keeping their
customers. When a young
girl turns to a middle-aged
lady or a school girl
becomes a office lady,
H&M may not suits them.
As a result, H&M face a
challenge of constantly
attracting new customers.
This challenge may calls
for more cost in
promotion.
37. INNOVATIONS AT H & M
37
Rothwell’s Five Generations of Innovation” Model
Innovation management strategy adopted by H&M falls in the fourth generation of Rothwell’s model: (the
Generation of Integrated Business Processes)
This generation is relevant to fast fashion industry as products life cycle is short and companies need to
integrate processes with product development to offer the “total concept", by ways of integrating “cross
functional innovation "and “parallel process of development "within the company (Roth well, 1992) and
throughout working with suppliers for production of new raw materials, collaborating with designers to
create collections and interacting with customers by getting their feedback to predict the next trends.
“Vertical linkages” with customers and suppliers as they can be involved in creating new products
“Horizontal linkages” through partnerships and alliances is also seen in H&M’s strategy
38. 38
INNOVATION WITH A CAUSE
2008: Fashion Against Aids
2008: Marimekko
2009: Fashion Against Aids
2009: Jesper Waldenstam, Liselotte Watkins (H&M
Home)
2010: Black Book
2010: Julie Verhoeven (H&M Home)
2010: Lovisa Burfit (H&M Home)
2011: Elin Kling
2011: Fashion Against Aids
2011: Swedish Hasbeens
2011: Knotted Gun, Non-Violence organisation
2011: Trish Summerville, The Stockholm collection:
The Girl with the Dragon Tattoo
2012: Fashion Against Aids
2013: H&M for Brick Lane Bikes
39. 39
“HIV and AIDS are still growing problems and people
lose sight of it.
H&M and DAA have found such a hip and accessible
way to educate our youth. I think it’s really important
to remind people that it’s really cool to be safe."
FASHION AGAINST
AIDS COLLECTION
41. 41
“Sustainability is a long-term
trend at H&M. This April H&M,
as part of its focus on
sustainability, will introduce
Conscious Collection, an
ongoing range for women, men
and kids, made from
environmentally-adapted and
greener materials such as
organic cotton, Tencel® and
recycled polyester. H&M’s
designers have been inspired by
different shades of white, one of
the most important colours this
spring. A minimalist, tailored
look is combined with romantic
lace, Broderie Anglaise, frills
and draping. The Conscious
Collection will be on sale in all
H&M stores from April 14th.”
42. 42
SUSTAINABILITY
IS THE WAY !!
H&M was awarded The
Deloitte China
Sustainability Award 2014
and ranked #11 in Rank a
Brand for Sustainability
organization website
where it’s the top fast
fashion retailer in the list
43. 43
The conscious
collection is an example
of H&M’s closed loop
process innovation
As a leader in
sustainable
fashion, H&M avoids
waste and uses (no
longer used) clothes as
resources for new
products through
recycling and redesign.
An Example of Process Innovation:
CONSCIOUS COLLECTION
45. 45
CONCLUSION
H&M has come a long way from selling only womens clothing back in 1947 to
become a multinational company serving both men's and womens clothing in
most countries worldwide.
It is publicly listed in NASDAQ as OMX of Stockholm. By the end of the first
quarter of fiscal year 2014, H&M group had 3,200 stores globally in 54 countries
employing 116,000 employees. It announced that sales including VAT amounted
to Swedish Krona (SEK)150 billion and a profit after tax of SEK 17.3 billion which
is an increase of 13% comparing to fiscal year 2013 and the same percentage of
increase for gross profit.
The company does not own any factories and it works with 900 “Independent
Suppliers” instead, mainly in Asia
H&M is ranked as the 5th Global Fashion Retailer and gained itself the same rank
in the World’s Top 10 Most Innovative Style Company list 2014 according to Fast
Company & Inc. website. It’s ranked #30 In Forbes Most Valuable Brands Listand
is the first fast fashion brand retailer appears in the list. The company was named
2014 World's Most Ethical Company by the Ethisphere Institute
