Image can be found at: http://www.yarisha.com/lifestyle/shopping/welcome-hm-to-sa/

Retail essay illustratedH&M, Hennes & Mauritz AB

Hennes & Mauritz AB, known by the initials of H&M, is a multinational Swedish company with the segment of the market focused on the retail of clothing; fast fashion. It is one of the world’s most successful clothes retailer, with a yearly growth of 4.62%, more than 3900 shops worldwide, 132.000 employees in 2015 and owns 6 autonomous brands which I will describe in more depth further. In the following paragraph, I will introduce you to my chosen brand, starting with an overview of the product range, company values, key strategies including corporate social responsibility and brand positioning.

Cristina Varela (Aoki)Introduction to Marketing FT4100CW2 Retail essay [illustrated retail audit] 2500 wordsDeadline: 4th May 2016

http://www.keyword-suggestions.com/aG0/

Cotton, http://www.fibre2fashion.com/news/textile-news/

Hennes & Mauritz AB, was founded in 1947 in Vasteras, Sweden, by Erling Persson. The first store was called Hennes (plural of she in Swedish) which started only with women’s wear, moving in 1952 to Stockholm, where, in 1968 they Bought “Mauritz Widforss”, an hunting and fishing equipment store, changing the name to “Hennes and Mauritz”. As the business was growing, consequently, the range of products enlarged; soon men’s and children wear were introduced. Currently their product range vary between dazzling party, functional sportswear to basics collection for men, women, kids, teenager, accessories, shoes, make up, underwear and very fashionable home wear. This vast variety of products and collections, allows costumers to find something that suits their style and needs, even the most quirky ones. Hennes & Mauritz AB, has as target seven commitments: more sustainable materials that are good for people and for wallet, continuing the use of cotton, better working conditions, garment collection, animal welfare, business concept, better wages and environment awareness (water). The company is investing in making the most of sustainability fashion, as a result, they created a collection named “conscious”, by all means, the promise is: “Provide fashion for conscious customers• Choose and reward responsible partners• Be ethical• Be climate smart• Reduce, reuse, recycle• Use natural resources responsibly• Strengthen communities”(www.hm.com, accessed on 5, April, 2016). With those challenges settled, the company has made improvements to the lives of thousands cotton farmers and have became the largest consumers of cotton, these have had a huge impact on the way the company is perceived by costumers who are looking for brands with an conscious approach.‘We want to help people express their personality and feel proud of what they wear” (Karl-Johan Persson, CEO. www.hm.com, assessed on the 6th April) these visions, are therefore, to lead the business concept in away that offers quality and good value that is economically, environmentallyand socially sustainable by looking for new materials and ways of improving, using less of our planet’s resources and reducing waste. The collection can be easily identified with its green hang-tag.

Cotton extraction, http://action.sumofus.org/a/hm-cotton/

http://rumbomb.tumblr.com

The brand offers suggestions on the website on how to be environmental aware, such as: if you wash your clothes at 30 degrees instead of 60 you will save half of your energy, you can also donate clothes in-store for part recycling and receive an £5.00 voucher to redeem in your next shop when spending £30.00 or over; the initiative is called “Garment collecting”, which makes Hennes & Mauritz AB, the first fashion brand, to launch this new concept; reducing waste, sav-ing and giving products a new life aiming that no textile will go to waste in the near future and at least 95% to be recycled. “Don’t let fashion go to waste” is the campaign slogan, which suggests that is at least three ways you can dispose your unwanted garments, reusing, turning them to other products such as cleaning clothes or bricolage; re-wearing, selling or giving to charity and recycling, turn-ing it into fabrics or to be used as insulation. The brand states that all the money possible made with this service is to be invested in social service.The brand strategy is to increase the number of stores by 10% to 15% per year, continuing to offering quality and sustainability. The same applies to their com-promised six independent brands, COS, Monki, Weekdays, Cheap Monday, & Others Stories, respectively:

COS, current, timeless and functional; the concept consists of high end design and quality for those who aim these sort of lifestyle and aim a contemporary wardrobe beyond seasons, based in style rather than fashion; available for wom-en, men and children in 30 countries and online in 19 countries.Monki, is all about personal style, is modern, playful, creative, colourful and graphic; this individualistic street-wear is focused mainly for young female available in 13 markets.Weekday, modern and trendy influenced by Scandinavian style, offering in store brands and selected external designers; follow the beliefs of future of fashion and society mind, available in 5 countries.Cheap Monday, a mixture between street fashion and catwalk as influence, the garments possess a high-fashion feel; the most popular range is the trendy den-im range, available in 5 markets.& other stories, besides clothes, the brand offers a selection of accessories, shoes and cosmetics, the priority is quality and design, along with personal expression of styling is available in 10 countries.

Cos, fall winter 2015 campaign Accessed on http://www.fashiongonerogue.com

Hennes & Mauritz AB, stores are always in the best location possible for business, with their premises hired instead of owned, which allows to become flexible to any changes where retail landscape is concern, their store are often positioned in the most attractive streets and shopping centres, also, part of their business strategy is online expansion, the brand offers online services in 30 mar-kets and their 6 independent stores in 32! aiming in continuing growth, offering customers purchases from their mobile phone, laptop or tablet at “distance of a click”. The current segment of marketing is 17 to 26, as teenagers with young girls highlighted.Franchising is not part of the business strategy, hence all stores are run directly by Hennes & Mauritz AB, with exception of Middle Eastern, where, they made an agreement with Kuwaiti company; M.H. Alshaya to open four stores, as result, three will be in Dubai, two situated in Emirates shopping centre and the fourth in Ibn Battuta. Like any other retailer, Hennes & Mauritz AB, faces competition. Among others, Gap, Uniqlo, Forever 21 and the group inditex, (Stradivarius, Pull&Bear, Massimo Dutti, Bershka, , Oysho, Zara Home, Uterqüe and Zara) which the core business is the most parallel to, nevertheless, Zara is the number one fashion retailer brand in the world leaving our brand the second spot on the ranking, even so, Hennes & Mauritz AB, is demonstrating being very prominent which I believe soon will be overtaken the first position.

In this next section, I will do a SWOT analysis of the two brands and specify why I believe Hennes & Mauritz AB will be soon overtake the group Zara Inditex as number one retailer worldwide.

Zara advert, can be found at: http://action.sumofus.org/a/zara

Strengths H&M Zara

Trend setting and innovative.Some garments are made from recycled fabrics. Suits every age and style . High end designer collaborations.USP; Conscious approach, number one cotton user and leaders in the price marketing, with consistently low prices. Costumers and employee focused.Stronger than Zara on social media with 13.4m followers and 2226 posts.Diversity, as models are from all over the world.Online purchase can be refunded in store£5.00 voucher to redeem in your next purchase when you spend £30.00 or more.Costumer sign up with news and promotion.Activists with “Fashion against AIDs” campaign and consciousAll sizes (including plus size)Advertising are modern and up to date, with a cool look, prices are integrated on adverts, so costumers know what to expect.Online page where they tell stories of ‘ordinary’ people.Shops looks often tidyConstantly in store promotions or vouchers including student discount.Great costumer servicesCelebrities often voluntary uses their conscious clothes as state-ment of affordable taste and status which brakes the scepticism that celebrities have to use expensive clothes and show wealth.Being a Swedish brand the Scandinavian economy affects the company.Combines status, luxury and affordability Costumers are allowed to pay instalments on online purchases.Changed the way how people perceived and consume fashion.

Modern, trendy, sophisticated and European

Factories in Europe

Save on adverts

Strong windows design

Appeal to all age

Independent brands such as Massimo Dutti, Berskha, Pull&Bear and Stradivarius are very successful in Europe

Good quality.

The online app is very organised and simple to useOwns it’s supplier chain, which gives advantage to the competitors.

Quick response, as garments come “straight” from catwalkup to two weeks!

VS

Weaknesses H&M Zara

The online website does not promote the ‘trend’ collection which is a more high end collection with fine products and design.

Does not have a collect in store when purchase online so cos-tumers will have to pay the £3.95 fee when buying online for home delivery except some promotions.

When there is a designer collaboration, the stock runs out within hours and often sold on online platforms for extremely expensive prices, therefore a better system should be in place.

Some of the collections are very limited.

Lately seams to constantly re merchandising the store lay out which can be confusing for a regular costumer.

Not all the stores possess the same display.

Follows the government stipulated £5 for bag use which can cause a negative reaction from some costumers.

Not very engaging on social media with only 10.4m followers on Instagram and 975 posts.

Shows lack of interest for environment and well-being

Does not suits all tastes as it is very classic.

Not affordable with prices hard to predict as they seam to change from product to product in an pretty drastically way

Most products are sold immediately turning it to very exclusive

Most of the staff does not speaks a clear English or don’t speak at all. Staff are often not very sympathetic or friendly offering Bad costumer services, claiming being explored by the company.

Costumer does not seams to be on heart of things

Does not do collaborations.

When loosing valid receipt is not possible to return or exchange.

Trend followers, has a reputation of copy cat.

As a Spanish brand the brand can be influenced by the country economic growth, which is in recession at the moment.Does not posses an oversize collection and sizes are very small.

No student discount or other type.

OpportunitiesH&M Zara

There is a gap in the market where fabric recycling is concern, therefore, continuing to invest on ways to improve it, as being the only fashion retailer with a recycle system gives advantagefrom the competitors.Invest in Asian as the biggest consumers are proven to be in a near future in Asia also in the BRIC counties.The stores in London seem to be trendier than any other coun-try, taken as example Portugal where I’m from; I would not shop in H&M as often or at all. Whereas in London is my favourite brand.Adapting their clothes to other markets is a great strategy, al-though as to think on globalisation and main stream, as celebri-ties are often the trend setters and what is happening in influen-tial cities such as London and New York.Invest in students as they are their main customers by increasing the number of students’ discounts.Establish an in-store click and collect system, allowing custom-ers to collect their purchase without having to pay the home delivery charge. Create a costumer fidelity card. Continuing to: provide costumer services online and in store, engage on social media, the collaborations to keep costumers motivated and to gain a larger audience, involve in charity.

Invest in adverts

Be more proactive and dynamic on social media

Improve costumer services

Create an environmental approach

Focused more on costumers rather than the business

Have conscious prices

Continuing to invest in China as soon it will overcame US as the number one world economy and the most e-comerce costumers.

ThreatsH&M Zara

Competitors are increasing, new companies are starting to be successful, Zara still the leader and gap and Forever 21 getting close. Political factors in Europe are tense at the moment which can cause a drop in sells in some places or affect their stores on middle east. Environment alternations, with global heating we running of some resources which contributes for an price increasing. The company as a reputation of labour exploration, with child workers in countries such Bangladesh, which can cause serious damages to the brand. Be transparent about their business. Although they have great potential, the independent brands are not well know in the biggest capitals, promote it with dis-count vouchers to be use on those stores. Be aware of their competitors and what they are doing and their USP, market can move quickly and changes may affect consumers behaviour. The can loose his identity due the amount of designers collab-oration.

H&M is getting exposition with the designer collaborations and the conscious project. With global economy growth being nil, people will look for more affordable brands such as H&M or Primark, therefore, qual-ity would not be the first priority as people are seeking life experi-ences rather than material, as well as trends changes rapidity. Political and environmental situation in Europe can have huge impact in the brand as most of their factories are in Europe. Zara owns their fabrics and some are held in Europe, conse-quently the wages have to be according to minimum living wages of that country which may affect company prices and profit. Quality is not as good as it used to be. Reputation of being copy cat (catwalk) inclusive being persecut-ed before for that reason.

The company closed their 2015 yearly financial report successfully, with SEK 210billion corresponding to £178 billion, an increase of 19% on sales. The group opened 472 stores and closed 59, 156 were franchises, with a total of 3,924 stores as of 30 November 2015 in 61 markets with new stores opening in India, New Delhi and in South Africa, Cape Town and expanding the already existing market in New Zealand, Cyprus and Puerto Rico and E-commerce ex-panding to 9 existing markets. COS was their more profitable brand, with total of 153 worldwide stores, being therefore, their most profitable brand. Hennes and Mauritz Are aiming to open 425 new stores for the 2015/2016 financial year. With gross profit increased by 16% to SEK 103,167 m (89,052), 75m will go towards the Hennes & Mauritz Incentive Program (HIP), which is for all employees (exceptions may apply).

SEK mNet salesGross profitgross margin, %Operating profitoperating margin, %Net financial itemsProfit after financial itemsTaxProfit for the periodEarnings per share, SE

Full year 2015 180,861103,16757.026.94214.0930027.242-6.34420.89812.63

Sales in top fivemarkets, full-year

2015, SEK M (inc. Vat) New stores (net)

Germany 36,943 9USA 25,135 5United Kingdom 16,001 11China 10,559 83Whereof franchise 4.494 26

Curiously on their mother country the company is not looking to open more stores

Image can be found at : http://ww2.glance.net/solutions/glance-for-finance/

Globalization

GlobalizationHennes & Mauritz AB, plans to open 240 stores in between China and the USA alone, expanding aggressively across Asia where the clothes expenses are rising 11% yearly. China, with a population of 1.4billion and the second world largest economy, soon to overtake the US as the world’s biggest retail market.“The growth of the internet and social media have generated global fashion trends and this has made it far easier for international fashion brands to expand. Where once fashion tended to be local, this is no longer the case,”( http://www.warc.com . Accessed on 28th March 2016) predictably, Chinese consumers will double their annual clothing expenditures to more than double in 2018 approximately £212 billion, Hennes and Mauritz, already have 299 stores in China, Karl-Johan Persson, chief executive, told the Wall Street Journal;"We have a positive long-term view on China; our position there is strong, as is our profitability," the slight slowdown does not seams to stop the retailer, as they plan to target the country's growing upper-middle class with the opening of its premium brand, Cos.

Opening of the 3000 H&M store in Cheng Du, China, www.news.com.

Political

Its a Plc, public limited company,legislations and regula-tions,political stabilitytaxesgovernment restrictions for foreign business.

Environment

Is known as the most conscious retailer with their environmen-tal awareness about sustainability and eco friendly production, transportation and the use of bio fabrics, also number one retailer in the use of 100% cottonclimates change, the company as to adopt different approach and adjust the collection to the country.demographic changes

Social

Follows newest trends and western look,popular between stu-dents with fashion awareness who seek quality combining with good prices, involved in Charity with found for AidsCRS conscious project.

Technological

The company, as ma-jority of retailers is investing in technology, therefore improving theapp and website to be more user friendly, how-ever it still needs some organisation in terms ofcollections as it can be a mess to find a specific collection. QR code is integrated, which helpcustomers whenever an item is sold out in store to scan, finding all the information online and possible purchasing it. Some stores possess a touch screen where you can access online.Find innovative solu-tions that turn the website more interactive however the brand is active in social media.

Economy

Being a Swedish com-pany the company is affected by the country economical growth andthe power of his curren-cy, the company is very keen in providing fair wages, with 132.000employees all over the world (markets). The Brand do not possess hold their own fabrics, therefore, living wages costs may vary depend-ing of the country as well as transportationcosts. The world eco-nomic growth is in re-cession which is affect-ing interest rates.Currency

Legal

Employment lawregulations and stand-ardstax policytrade restrictions in different countries

Micro environment

CostumersAs mentioned previously, costumers are on the core of the business

EmployeesStaff are motivated, engaged to progress within the company.Hennes & Mauritz AB Incentive Program (HIP), which is for all employees.

SuppliersThere are about 2.700 manufacturing facilities all over the world that are also involved in the design and development. Hennes and Mauritz AB is aware of the selection of the countries that are produced in, about 800 suppliers which have again sub-suppliers. Provides training to the suppliers to take ownership on their own sustainability work.all supplies must sign an “sustainability commitment “ as mentioned previouslySecond tier suppliers Hennes and Mauritz AB, does not works direct with them, therefore does not have direct influence, however they are working in ways to improve the value of their chains on their

ShareholderThe company has a supervisory board, chairman of the board is Stefan Persson who owns about 186 milion shares of the company. Supply chain Is consisted by the buyers who work allong with a the designers, merchandiser team and patter makers on their headquarters at Stockholm to create, plan and buy future collections; Merchandisers, they are based in 15 of the productions office and work as a bridge between buyers and suppliers.

Auditorsknown as the sustainability team, around 80 people who monitors suppliers work practice following an full audit program, started in February 2016, all sup-pliers must sign the “sustainability commitment” a code of conduct

H&M magazine, can be found at: http://www.nevsmodels.co.uk/news/hm-magazine

H&M Customer Profile

Aoki• Age group 26 to 34• Passionate about life.• Prefers happiness/Experience

rather than money/material• Aspires to became a buyer in

H&M• Shops several times a week• Shops mainly at H&M Trend,

which is closer to designer clothes.

• Enjoy social events and net-working

• Enjoy helping others• Enjoys do good things in life,

However is aware of the costs• Ambitious and motivated• Aspires to reach a profession-

al Status.• Work as a part time manager

in retail .• Student rep/ ambassador

• Believes Scandina-vian is the perfect Nation to build a future and start a career.

• Fashion journalist.• Traveller

The brand is known by their enormous collaboration with high end designers: • 2004: Karl Lagerfeld • 2005: Stella McCartney, Elio Fiorucci, Solange Azagury-Partridge • 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 • 2016: Balmain Style icon collaborations • 2006: Madonna • 2007: Madonna, Kylie Minogue • 2012: Anna Dello Russo • 2012: David Beckham • 2013: BeyoncéH&M Design Award Winners • 2012: Stine Riis • 2013: Minju Kim • 2014: Eddy AnemianA selection of other collaborations • 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 • 2015: CoachellaWith the Dragon Tattoo • 2012: Fashion Against Aids • 2013: H&M for Brick Lane Bikes H&M most successful collaboration to date, can be found at: https://statsinstilettos.com/2015/10/22/balmain-

Conclusion

For all the above mentioned reasons, I believe Hennes and Mauritz AB is therefore the multi-channel retailer to watch for. As a result of being an Scan-dinavian brand, the retailer offers freshness and a clean look to the industry, growing massively and built on a strong reputationaround their customers and social media, continuing to impress with their collaborations,environmental consciousness, and welfare; bringing integrity to the fast fash-ion world. The fact that in my point of view, will contribute significantly, to overtake their biggest competitor Zara, as one seems to lack in innovation and slightly repetitive, failing to fulfil this new generation of fast consumers who rather pay less for their garments and have more options in their wardrobe. Being one of Hennes and Mauritzs AB, biggest customer and aspiring employ-ee, I extremely recommend this fun, innovative and futuristic brand.

29.99 Jumper

Shop at HM.comH&M advert created by me for Creative Marketing.

Bibliography Muran, Lisa. “Profile of H&M: A Pioneer of Fast Fashion.” Textile Outlook International (July 2007): 11-36. Textile Technology Index. EBSCO. Mary Couts Burnett Library, Fort Worth, Texas.

Sheridan, M., Moore, C., Nobbs, K. (2005) “Fast Fashion Requires Fast Mar-keting: the role of category management in Fast Fashion Positioning”, Journal of Fashion Marketing and Management, vol. 10, No. 3, pp. 301-315.

Angus S. (2010), "Oxford dictionary of English", 3rd edn. p.727, Oxford university press.

Business of fashion (2016) Uk. Available at http:// www.businessoffashion.com (accessed 28 March, 2016)

Bussiness insider (2015) UK. Available at http://www.businessinsider.com (Accessed: 28 March, 2016)

CORE (2009) UK. Available at https://core.ac.uk/ (Accessed: 26 April, 2016)

Dafont (2015) US.Available at : http://www.dafont.com (Accessed: 28 March, 2016)

Fast fashion trend. Available at http://fastfashiontrend.wordpress.com (Ac-cessed: 28 March, 2016)

International franchising (2016) Available at http://.internationalfranchisedi-rectory.net/

H&M (2016) UK. Available at http://www.hm.com/abouthm(Accessed: 28 March, 2016)

WARC (2016) UK. Available at http:// http://www.warc.com/(Accessed: 24 April, 2016)

WGSN (2016)UK. Available at https://www.wgsn.com/blogs/hm-(Accessed: 24 April, 2016)

Wall Street Journal http://www.wsj.com (Accessed: 26 April, 2016)

Write pass (2015)Uk. Available at http://writepass.com/journal/2015/

Zara (2016)Uk.Available at https://www.inditex.com/brands Sources:

Appendix, Regular visits to H&M stores in different locations and countries, questioning employees, exploring the layouts and environment.Notes collected through out the year at the module. Please check the link bellow for the video I have done for a possi-ble idea of H&M advertising.

Can be found at http://akavenue.com/grand-re-opening-of-hm-in-indy/

https://youtu.be/Mqd6XtYyclM

500 words learning JournalIt has been an amazing year, more that I ever wished or would expect. Being selected as student representative, student ambassador, writer for the UEL magazine and winning the very competitive scholarship going glob-al.Having a background in marketing, Intro-duction To Marketing is therefore the mod-ule of my preference. On the next paragraph, I will justify my statement.Although this module is mainly theory, I believe it will be relevant for my career as nowadays marketing is fundamental in any company.What made this module exciting were the enormous opportunities within the industry, for instance, when we went to Savile Row, interviewing the logistics, I found it extreme-ly interesting. The shop assistants were very helpful and keen to help! Some of them gave me samples while others allowed me to see where the bespoke suits were made, during their working hours so I could experience all the process, it build my confidence and moti-vation to learn more.Another good example, was the time we went to Westfield, White city, it also boast my confidence on areas I was unfamiliar with, such as Journal-ism (until then) I gathered as much information as I could and also invited friends to participate. Last but not least the one I enjoyed the most was when we went to Agnes B pop up event (picture above) and I interview the designer, in consequence, I created a network directly with the industry and felt proud of representing my University.Working as a group is already a challenge, however in this module, we had the opportunity of choosing who we would like to work with which contributed massively to have great marks as we coordinated perfectly.For all the above reason, I believe it is a great module to have along with Creative Marketing which I'm looking forward to return next year!