Global industry study: Hennes & Mauritz (H&M)

Résumé du document

The aim of this International Marketing survey is to present the international operations of a global brand and to confront them with our international marketing lessons. Our studied company is Hennes & Mauritz AB (H&M). Before analyzing all the international operations of this group, it seems to be interesting to make a brief presentation of this Swedish company. H&M was founded in 1947 in Vasteras Sweden by Erling Personn. During the last fifty years, the company expanded and became a global brand famous all over the world. Nowadays, 68 000 employees are working in 1 500 H&M stores present in 28 countries. Moreover, H&M is one of the most durable company in the world. Becoming a global brand involved an adaptation of the company's strategy and structure. What is the current position of H&M in the growing fashion and clothing market and what is the strategy enforced by the company to confront with this market? That's what we will see further. First, we will present a general overview of H&M, then we will develop the key points of the fashion clothing market, third we will analyze the main strategic evolution of the company and finally we will discuss the marketing mix of H&M.

Extraits

[...] In fact, they have a big influence on the retailing price. H&M work with approximately 700 suppliers. This number does not allow a single of them to have a relevant power against the group. As mentioned before, the H&M's Code of Conduct makes sure that they meet some requirements about quality, environment and ethic. The group oversees the whole production process so it has more power than its suppliers and gives them directives. About 60% of H&M's production offices are located in Asia[16]. [...]

[...] Its major competitor is the brand Zara of the Inditex group which has a similar marketing strategy but not the same international one. The fact that there are plenty of fashions means that substitute products are also profuse. Fashion itself is very variable through time; this is why H&M tries to adapt their articles to the world demand expectations by creating and renewing collections while keeping furnishing the stores very quickly. Limits First, the information found on the site of H&M may be biased. [...]

[...] Application The business concept of H&M is give the customer unbeatable value by offering fashion and quality at the best price”. However, the brand is not defined in that way in customers' minds. The brand is recognized as being fashionable and cheap, but the product quality is poor for most of them. That is why the company launched COS which give a better image of the company. Moreover, H&M has a real particularity in its positioning: the firm promotes its brand image as luxury fashion houses do. [...]

[...] This fact implies an obvious and bigger variety of articles in that business sector. Substitute products of H&M ones can be bought by customers in shops which are specialized in particular fashion styles such as ridewear, streetswear, sportswear or others. Quicksilver, Ripcurl, Nike, Adidas as well as Levis, Tommy Hilfiger or Diesel are global brands which represent another lay of competitors because of their substitute products The bargaining power of customers The bargaining power of the customers is quite low concerning the prices because H&M is already known as a company which sells quality articles at good prices. [...]

[...] The men's line consists of a number of concepts offering a wide range of options to meet different needs with regard to fashion content, function, and price. One of the newest concepts is a “high quality” tailored garment line for men (L.O.G.G.). We can notice that the men's range is also coordinated with accessories. The teenage department is called Divided and is made of high fashion clothes for young men and women. The range consists of denim and street-inspired fashions for guys and girls, as well as evening wear and accessories for girls. [...]