University Of Bahrain

MKT 264 section-06

Group assignment

MARKETIN
G CASE
ANALYSIS

Hennes & Mauritz AB is a Swedish Multinational clothing-retail

company known for its fast-fashion clothing for men, women, Hennes & Mauritz AB
teenagers and children.

Submitted by-

1- NAWAL KHALIL-20188238
2- SARA HANIF HANIFULLAH-20180417
3- WAQAS MOHAMMAD HANIF MAHMOOD-20187933
4- AISHA ZULFIQAR AHMED-20175025
5- IRSA AROOJ MUHAMMAD AYUB-20183031
 MARKETING CASE ANALYSIS- H&M |2

Table of Contents
INTRODUCTION.................................................................................................................................3
1.1. COMPANY PROFILE............................................................................................................3
1.2. BACKGROUND AND HISTORY.............................................................................................3
1.3. MISSION AND VALUES.......................................................................................................4
1.4. BRANDS AND PRODUCTS OFFERED BY H&M.....................................................................5
1.5. SEGMENTATION STRATEGY-..............................................................................................6
1.6. TARGETING STRATEGY-......................................................................................................6
1.7. POSITIONING STATEMENT-................................................................................................6
2. DISCUSSIONS AND FINDINGS.....................................................................................................6
2.1. BUSINESS PORTFOLIO ANALYSIS........................................................................................6
2.2. PRODUCT EXPANSION GRID...............................................................................................8
2.3. SWOT ANALYSIS.................................................................................................................9
2.4. INTERNATIONAL MARKETING POLICY:.............................................................................11
2.5. CRM (customer relationship management).....................................................................11
2.6. Assurance of supplies for H&M.......................................................................................11
2.7. MARKETING MIX (4ps):....................................................................................................12
2.8. THE ROLE OF DIGITAL MEDIA PROMOTION IN THE SUCCESS OF H&M............................14
2.9. Sustainable marketing effort............................................................................................15
2.10. Survey..........................................................................................................................15
 MARKETING CASE ANALYSIS- H&M |3

INTRODUCTION

1.1. COMPANY PROFILE

“The H&M Foundation is a non-profit global foundation, privately funded by the Stefan Persson
family, founders and main owners of H&M Group. Its vision is to improve lives by creating a better
tomorrow, and to contribute to reaching the UN Sustainable Development Goals for 2030”.
[ CITATION HMf \l 1033 ]

1.2. BACKGROUND AND HISTORY

With over 550 stores in twelve countries across Europe, Hennes & Mauritz AB (H&M) has quickly
become one amongst the world's most eminent covering retailers. Each year, the Sweden-based
chain sells over three hundred million primarily company-designed clothes and accessories, together
with cosmetics, price some SKr twenty six.6 billion (US$3.15 billion). The corporate has been
therefore winning at exporting its low-price, high-quality wear fashions that over 80 % of its sales are
accomplished outside of Sweden; in fact, since the mid-1990s, the company's largest single market
has been Germany, wherever the company's 150 stores represent some 30 % of total sales. H&M has
also been expanding on the far side Sweden with its catalog sales, operated under the name H&M
Rowells that remains
restricted to the
Scandinavian market
within the 1990s.

H&M's steady growth--

which has seen its sales
double within the four
years between 1994 and
1998--can be expected to
continue, with new store
openings averaging some
60 per year. The corporate
has barely begun to tap its growth potential. In Germany, the company represents less than 2 % of
the overall retail consumer goods market; H&M remains equally restricted in England, where the
company's market share is less than 0.5 percent.

H&M continues to be majority controlled by the beginning Persson family, who own some 70 % of
the company's stock. In 1998, however, chief architect of the company's growth Stefan Persson was
named the company's executive chairman. In his position as director, the corporate has placed
Fabian Mansson, former buying director.[ CITATION Hen \l 1033 ]
 MARKETING CASE ANALYSIS- H&M |4

1.3. MISSION AND VALUES

H&M Mission Statement

H&M mission statement is “to drive a long lasting positive change and improve living conditions by
investing in people, communities and innovative ideas.” It comprises of two main parts
Transforming shopping and improving lives.[ CITATION HMM \l 1033 ]

In the initial half, H&M shows that the enjoyment and satisfaction of its clients is a priority in all its
stores. That’s why the corporate is organized in an impressive way to guarantee shoppers have
maximum freedom and luxury while choosing their products. H&M describes its shops as hospitable
for all, not simply the purchasers, and this is often what makes it appealing for the purchasers. To
make sure that the company meets the individual wants of everybody regardless of gender or age
and impact their lives, H&M takes great caution in the structuring and display of fashions for men,
women, and kids. Such class makes it straightforward for all clients to shop and enjoy the aesthetic
look they long for.

H&M Vision Statement

Our vision is to lead the change towards circular and renewable fashion while being a fair and
equal company.[ CITATION HMM \l 1033 ]

This statement shows how committed the company is when it comes to maintaining the trendiness
of fashion and their affordability. H&M remains attentive to emerging styles while initiating the
creation of latest ones. The corporate keeps all its wide selection of brands updated with what's in
demand. The fairness and equality of H&M are reflected in numerous forms resembling its hospitable
nature, passion towards sustainability, as well as the competitive prices that it tags on their products.

H&M Values
 We Are One Team

 We Believe In People

 Entrepreneurial Spirit

 Constant Improvement

 Cost-Conscious

 Straightforward and Open-Minded

 Keep It Simple.[ CITATION HMf \l 1033 ]

These are basically the principles that guide the operations and activities around H&M. They are
attributed to the spectacular culture that characterizes this corporation, creating it one among the
foremost desired firms globally.

1.4. BRANDS AND PRODUCTS OFFERED BY H&M

H&M consists of 8 defined brands which are H&M, COS, WEEKDAY, MONKI, H&M HOME, ARKET,
AFOUND, & OTHER STORIES. Together these brands provide customers a wealth of designs and




C
W
Y
M
K
F
A
H
&
D
N
E
I
R
O
T
S
U MARKETING CASE ANALYSIS- H&M |5

trends among fashion, beauty, accessories and home wares as well as trendy, healthy food. Each
brand works with constant enhancements of their ranges to continually be relevant, while the H&M
group’s investments in the supply chain, tech, advanced analytics and AI will also profit customers of
all the brands within the cluster.

H&M stores carry a wide variety of clothing for

Women
Men
Kids
Sportswear

WOMENSWEAR
H&M fashion for woman collection includes casual wear, party dresses, sportswear, and maternity
clothes. With this woman collection the company creates a balance between current- fashionable
looks and updated fashion- classics.

MENSWEAR
H&M carries a large selection of men’s clothing as well which includes work shirts, casual wear, and
sportswear and customized pieces for more festive occasions. It describes its male fashion collection
as having everything a man needs to create a fashionable and flexible wardrobe.

KIDSWEAR
The company also has a kid’s clothing selection with pieces available for children from birth to age
14. It includes dresses, pajamas, coats and jeans. According to the company every kid’s item is tested
to ensure it meets the standards for quality, function, safety and sustainability.

SPORTSWEAR
H&M offers an amazing collection of sportswear for men & women. This includes a variety of gym-
wear and workout clothes and accessories at affordable price.
 MARKETING CASE ANALYSIS- H&M |6

1.5. SEGMENTATION STRATEGY-

H&M uses three types of market segmentation to reach its customers all around the world

1. Geographic segmentation-H&M has several stores throughout the globe, ; Asia, Middle East,
North Africa, with North America and Europe being their biggest markets. With such a large spread of
various markets, they need to take into acknowledgement that they're targeting many various
religions, cultures and lifestyles thus their promoting habits ought to be done differently amongst the
different market areas because something which may be socially accepted in one country are often
shunned in another.
2. Demographic segmentation-H&M principally targets Generation Y that are those born between
1979 and 1994.This cluster is assessed as the ones who try whatever is new and in today's trends,
they additionally happen to pay most if their disposal money on consumer goods and are conscious
of brands and how much they price.
3. Psychographic segmentation- The Company targets many different cultures, lifestyles and
religions. This is the exact reason why marketing has to be done differently in different locations.

1.6. TARGETING STRATEGY-

H&M offers clothing and goods for every age but their main target market is women. Women shop
more and they often buy clothes and accessories for their children and husbands as well. The main
focus of H&M is to sell a modern up to date product for a low price for this purpose they target lower
middle class & working class. These women acquire the foremost modern clothes every season and
want to follow the trends without investing a great deal of cash. So as to meet the wants of the
purchasers, H&M launched EDLP (Every Day Low Prices) product. There are 2 pleasure peaks
happening within the method that are psychological identification and products worth. As a result,
H&M is successful in creating the mixture of the best style underneath the name of an affordable
consumer goods label.

1.7. POSITIONING STATEMENT-

H&M's selling strategy is encapsulated in its taglines “fast-fashion” and “fashion at the most effective
price”. H&M’s objective is to attain heaps of market share for its existing product, and its strategy is
(market penetration) i.e. to penetrate existing markets deeply and in addition develop its presence in
new markets. This positioning appeals to cost-conscious young shoppers.

2. DISCUSSIONS AND FINDINGS

2.1. BUSINESS PORTFOLIO ANALYSIS

H&M sells a variety of different products, by analyzing the current portfolio we can identify 7
different SBUs (fig 1) but in this report we’ll be looking at 4 main SBUs (fig 2).
 MARKETING CASE ANALYSIS- H&M |7

Figure 1 SBU (STRATEGIC BUSINESS UNITS)

The BCG matrix helps comprehend which items the firm ought to put resources into and which items
ought to be dropped from the mix.

 STAR: The center key strategic business unit of H&M is women swear, which yields the most
noteworthy profit. Approximately 57% of revenue is generated by its womenswear and is
continuously growing. It has high growth rate which implies it will require more investments later on.
The star in H&M’s product line is its womenswear with high growth rate and high market-share.
Because of high market share it will also generate large amounts of cash.
To maintain its position as a star H&M should expand this market and increase the number of
loyal customers which will also increase the buying frequency. Furthermore the company
should come out with more innovative styles which will attract more customers.
 CASH COW: The cash cow in H&M’s SBU is its menswear because it’s the second highest
profitable unit. It has high market share but the growth rate is low. It is bringing in more income than
what the company is investing. The menswear has a good position in the market but it is not very
attractive.
H&M should invest the excess cash generated by menswear into other products which need
investments and it should invest enough in menswear to hold its position as a cash cow.

Another cash cow in H&M’s SBU is its children’s wear Even if it is less profitable than menswear it is
still a cash cow because it provides enough cash without a lot of investment by the company. The
sales and growth in this SBU is affected by different factors such birth rates, death rates and divorce
rates. H&M is the third biggest retailer of children’s wear in the US and is included in top 15 in the
world for the most affordable and stylish kids wear.
T
P
4
D
I
K
3
N
2
R
A
E
M
O
W
1
U
B
S
 MARKETING CASE ANALYSIS- H&M |8

To increase profitability H&M should raise more awareness and invest in better marketing for
this division.
QUESTION MARK: In the above SBUs sportswear is the question mark as it is an attractive market but
the market share is low. The demand for sportswear is increasing.

H&M needs to watch its sportswear carefully and do accordingly. It can be a problem child in the
future but there is a possibility of turning this into a cash cow.

2.2. PRODUCT EXPANSION GRID

2.2.1. Market penetration:

Market penetration is that the strategy of launching existing product in existing markets. The primary
strategy the corporate uses are to supply varied discounts. These are often within the form of sales
throughout specific times during a year of augmented discounts similar to discounts on massive
purchases or buy one get one free. H&M additionally motivates its customers to use a lot of
merchandise by promoting numerous designs through magazines and alternative channels
motivating consumers to try other products and styles. It has additionally acquired various smaller
retailers so as to scale back competition and increase its market share. The massive promoting
budget additionally creates entry barriers as developing a productive brand like H&M takes a large
advertising budget that most new entrants cannot afford. H&M also creates new store shops at
strategic locations that are meant to lure passers and encourage them to visit the shop and get
something. All of these penetration ways works to extend sales for the brand.

2.2.2. Market development:

In this activity, existing merchandise are promoted in new markets. The primary strategy that H&M
uses during this regard is to enter into new geographical markets. This is often done in two ways in
which primary method is to enter into new markets where the company doesn't have any stores. The
second strategy is to make new shops in an already serving market to increase access for shoppers.
Once coming into a brand new market, the corporate incurs huge expenses in promoting to make
awareness amongst shoppers. The company primarily focuses on retail stores but also has started
online sales in numerous nations as a brand new channel. H&M additionally creates completely
different pricing policies to focus on specific market segments. These can include low-priced products
or premium products aimed toward a certain socio-economic class. Each market development
initiative plays a very important role within the success of the organization.

2.2.3. Product Development:

Product development is the strategy of launching new product in existing markets. H&M does this in
various ways in which. The primary strategy that H&M adopts is to make new products. These are in
terms of latest styles and colors for existing products. H&M additionally creates new product which it
was not selling earlier. The launch of every new product is accompanied by a huge promoting
campaign. Also, the time of launch is chosen strategically supported the cloth material and style.
Every new style the company creates relies on client feedback, consumer wants, and market trends.
Once a product is launched, feedback is taken. Existing merchandise are improved once their initial
launch. H&M also has its own designers who work on making new styles and prints for the products
 MARKETING CASE ANALYSIS- H&M |9

of the company. Every new style takes time and energy. Once a brand new product is developed, it's
launched across the business.

2.2.4. Diversification:
This strategy requires a company to launch new product in new markets. H&M solely operates within
the consumer goods and accessories business. It can diversify in numerous ways. It can vertically
backward diversify by establishing its cotton fields and textile mills instead of procuring material from
suppliers. It can also horizontally diversify by steeping into different related industries similar to
sportswear, apparel, hosiery, and so on. Related diversification may be a safer strategy. The riskiest
would be to diversify into unrelated industries like sporting goods, consumer electronics, smart
phones, and so on. However, every diversification strategy can facilitate the company grow.

DOWNSIZING DUE TO COVID-19

H&M, one among the world's largest fashion retailers, is discussing temporary or permanent job cuts
for employees the least bit levels due to money setbacks caused by the corona virus, the corporate
proclaimed Monday. Sweden-based H&M has stores in over 74 markets, all of that are presently
closed in the United States, Germany, and as of last week, the UK. H&M temporarily shut down 3,441
of its 5,062 locations due to the virus but continues to be giving online sales in 50 of its markets.
Workers are likely to bear a major brunt of the economic hardship caused by the corona virus as
H&M shutters stores worldwide in a shot to minimize the spread of COVID-19, the illness caused by
the corona virus. H&M said it's experiencing "significant negative impact on sales" and temporary
layoffs are being mentioned as some way to mitigate losses. While the corporate doesn't understand
the precise scope of the layoffs, tens of thousands are possible, and also the company warned there
might even be permanent layoffs. H&M said it's considering "the potential need to terminate
employment" due to the scope of the COVID-19's impact. The company is reviewing alternative ways
that to cut prices beyond staffing and aforementioned it had been re-examining shopping for,
investments, and rent. H&M additionally canceled its dividend proposal. [ CITATION
businessinsiderrportHMw \l 1033 ]

2.3. SWOT ANALYSIS

2.3.1. STRENGTHS:
H&M’s biggest strength is its pricing strategy it sells affordable yet fashionable consumer goods and
has a large customer outreach. It has 4473 stores worldwide, 74 store markets and 51 online markets
as of 2020.[ CITATION HM2020 \l 1033 ]It has a great brand image and cheap prices. It also has a good
marketing mix with a great relationship with its suppliers. Another advantage is the location of its
stores the company has spread its stores strategically giving them the advantage of reaching out to a
great number of audiences. The marketing of H&M is done to a high standard social media and use of
 H
T
G
N
E
R
S
K
W
ff
9
-1
D
V
M
A
/
fl
x
ti
b
IC
U
P
O
s
m
h
g
d
p
e
v
r
n
f
k
c
y
lit
M A R K E T I N G C A S E A N A L Y S I S - H & M | 10

a
u
q
w
o
L
influencers has a great impact on the overall marketing strategy. The ability to adapt and influence
customer’s shopping behaviors is another reason why H&M is the second largest retailer of clothing
in the world.

2.3.2. WEAKNESSES:
The distribution system of the company is really slow the suppliers are based in the Far East mainly in
Europe and Asia which is always an unpredictable issue as the supply deliveries can be affected by an
array of pressure that cannot be helped for example a pandemic like COVID-19 and weather
condition, breakdown of transportation etc. The company is currently facing a lot of problems due to
the ongoing pandemic. The high costs of maintaining inventory in respond to changes in fashions and

trends. Another weakness of H&M is that it offers much range of products apart from clothing that
are not very successful example shoe range and beauty/cosmetic.

2.3.3. OPPORTUNITIES:
There are many opportunities for H&M to develop its business. As the online market is developing
day by day H&M should start expanding its online markets. As the blogging and influencers world is
growing, H&M could use this as a platform to reach more audiences. Collaborations with different
brands are also a great way of developing a business. Recently there is a an excessive demand for
fitness wear people are leaning more and more towards a healthy lifestyle H&M should use this as an
opportunity to promote its sportswear and produce more variety and ranges in this aspect.

2.3.4. THREATS:
The major threat is that the market is full of competitors whom are growing constantly, to compete
and produce the best amongst so many is hard and the biggest challenge H&M has to face. This is the
reason to why H&M should keep its effort in differentiation in order to face this aggressive
competition. In addition there are many other risks and uncertainties H&M cannot avoid and predict.
 M A R K E T I N G C A S E A N A L Y S I S - H & M | 11

The biggest threat as of now is COVID-19 the company is experiencing decline in sales and
temporarily shutting off their stores throughout the world. The unpredictable swings and external
influences are biggest threats to any organization. Additionally fashion and trends play an important
role, fashion is always evolving and changing with time to keep up with the trends is a difficult task.
All departments at H&M have to be up to date and if they don’t do this the company can lose money
and credibility.

2.4. INTERNATIONAL MARKETING POLICY:

H&M finds some kind of balance between standardization and adaptation of its advertizing program
by utilizing a general overall global marketing strategy and fitting this strategy with local elements.
The corporate is mindful to upkeep its overall image worldwide while also adjusting accordingly to
guarantee success in different countries. About 80% of the products produced by H&M are
standardized and the remaining 20% are left to allow for adaptation and adjustments of business
sectors in different territories. For example atmosphere and culture. [ CITATION
Internationalmarketinghm \l 1033 ] The main advantage of standardization is brand awareness and
the brand can keep its costs low. The biggest advantage of adaptation is that H&M can meet the
needs of target market and hence compete better with its competitors. A factor that drives H&M to
adjust their contributions in various markets is the cultural differences among the nations that H&M
is in. It has specific guidelines for its advertising and afterward every nation can utilize these rules to
build up the advertisements to tailor it for that market’s inclination. For instance, in Saudi Arabia
ladies are relied upon to the unassumingly dressed. When advertising to this nation, H&M utilizes
models that are all around secured from head to toe. Opposite in UK where the population isn’t as
unassuming , models are chose accordingly. The brand additionally adjusts to the patterns in the
various nations and this likewise assists with pulling in more clients. H&M doesn't possess any
industrial facilities, however rather works with 900 free providers. Fundamentally in Asia and
Europe, At this moment, H&M web based shopping is just accessible in the U.S. what's more, a few
European nations, the organization sees potential for online deals in all business sectors. H&M works
an overall advertising methodology, with the idea of having great quality garments at a low
cost. H&M's business idea is to offer design and quality at the best cost. The organization's
development target is to build the quantity of stores 10-15% every year, while likewise expanding
deals. This development is totally self financed. For example Saudi Arabia

 Bigger family units than Western European families 

 Exceptionally solid shopping center culture 
 H&M utilizes a greater number of pictures than content when publicizing in this area 
 With the goal for H&M to effectively advertise in the Middle East they stress the
significance of showcasing progressively preservationist pictures in light of the social
worth contrasts. The main other adjustment H&M has made here is to their
atmosphere. They have seen incredible achievement in this nation 
 H&M's worldwide market portion incorporates people of any age who are keen on
"style and quality at the best cost". 
 H&M underscores imaginative styling for design forward individuals. [ CITATION
arabianbusinesHM \l 1033 ]
 M A R K E T I N G C A S E A N A L Y S I S - H & M | 12

2.5. CRM (customer relationship management)

CRM is a way of thinking and a business system, upheld by an innovation stage, business
rules, work process, forms and social qualities, intended to connect with the client in a
community oriented discussion so as to give commonly useful incentive in a trusted and
straightforward business condition. It’s the companys response to the customer’s
responsibility for discussion."

• The objective clients of H&M have a place with the assembly of in vogue and in vogue
buyers who consider shopping to be a social movement giving delight in their everyday life.
They procure the most popular garments each season and need to follow the patterns
without putting away a ton of cash.

• H&M has a place with a gathering of retailers, which figured out how to drive the market
by driving the consumers‟ practices as opposed to being driven by them.

• It embraces EDLP (regular low valuing) methodology, H&M shows style purchasers to not
sit tight for retail establishment deals but instead purchase H&M low-value brand-name
items.

• notwithstanding the costs, H&M changes customers‟ conduct by making an exciting

shopping experience, The organization recharges its store stock day by day; thus, even the
clients who go to the store each day can hope to find new arrangements on each shopping
trip.

• Thus, H&M figures out how to keep their stores interesting for its clients and to make
them return more regularly than they would something else.

• Moreover, they welcomed the top style creators in the business, for example, Karl
Lagerfeld or numerous to be their accomplices for structuring the new assortment.
Accordingly, we trust H&M is fruitful in making the blend of the best plan under the name of
an economical dress mark.

2.6. Assurance of supplies for H&M

Suppliers are organization or any person who provides something needed such as product or service.
H&M doesn’t depend on factories or companies, their garment are obtained from more than 800
independent suppliers which are mostly located in Asia as Bangladesh and Europe.

In 2019, H&M becomes the first major brand to introduced and include the list of all suppliers for
each of its garments to ensure the quality control and customers relations. Customers can see from
 M A R K E T I N G C A S E A N A L Y S I S - H & M | 13

where their cloths are being made and can access to information by online or by physical shopping
through their Application. This idea is praised by their customers.

The company mostly relies on IT integration between the central national office and the production
offices. H&M’s each store is linked through Global ERP system which stores information and then
conveys and delivers information to different warehouses, suppliers and to production team.
Communication between the different departments takes place electronically, especially in required
supplies in different departments. This is crucial because they don’t own any factories and doesn’t
store fabrics in advance; instead their partner’s store fabrics on behalf of H&M. Suppliers are
awarded and graded based on performance and vertically integrated. Their relationship with
suppliers is direct and does not include any agenesis or middleman from many years. Most number
of suppliers is partner with H&M for over 10 or even more than 20 years. They have highly trained
and dedicated teams working in production department which gives them the information and
position of daily contact with their suppliers to maintain good relations with them, they consistently
visit

them and they closely follow how the production and required supplies takes place. Transportation
of garments and fabrics are from independent suppliers are transport through shipping and rail
transportation. H&M ranks 3rd on Gartner’s supply chain Top 15. That’s not easy for a company
which has more than 950 stores in 19 countries. Ordering the product at the right time is very
important to obtain best quality and price and lower lead times, H&M manufacture mostly 80% of
their inventory in advance and 20% based on current market trends. Lead times vary from few to 7
months, garments such as children wear are orders in advance and while more trendy cloths that’s
requires smaller quantities may be produced at a shorter notice of time.

Managing inventory is an important task for a company. H&M manufactured products go directly
from factories to logistics centers and held in regional replenishment centers from there they are
distributed to stores closer to the area. H&M is also opening up its global supply chain to other
clothing brands to tries to push more sustainable ways of making garments. The H&M is launching a
 M A R K E T I N G C A S E A N A L Y S I S - H & M | 14

service to allow smaller brands to use its suppliers in product development and sourcing to
production and logistics.

MR Helmersson said, “It’s no secret that we are part of an industry that’s been commercially
successful but not sustainable enough”“To future proof our industry, we have focused on
transferring and improving our supply chain. We’ve realized that the output of our efforts can be
valuable for others too.”He also said that this service could help others brands design a supplier
network to help them avoid the effect of corona virus and trade-war.

2.7. MARKETING MIX (4ps):

2.7.1. Product:
H&M is world’s favorite and most liked designer of attire and clothing for men and ladies.
Additionally H&M is well known not only for their fashion cosmetics but due to the high quality of the
clothes designed durability and funkiness of its clothes. Through the online stores, H&M offers the
regional, continental and European market an exclusive apparel design. The main goal of H&M is to
produce innovative designs of garments and clothes for various people in several countries all over
the world. The corporate is known because of its strategy of designing garments exclusively
according to each country’s preferences and desires. H&M main money maker was clothing but
today H&M manufactures and sells shoes, bags, accessories and beauty products. Moreover, these
products have many more several categories which targets different people and offer varying quality.
Women, men and kids have trusted H&M for their quick fashion wants because the company focuses
on improvement and introducing new trends through their products and this makes them achieve
more customer base around the world.

2.7.2. Price:
H&M are known for its chic, stylish apparel for affordable prices. It offers top quality garments at a
premium price. The foremost competitors of H&M are GAP and Zara. As compared to each of those
brands, H&M products are costs comparatively lower as a part of it marketing mix pricing strategy.
This is due to lower price of manufacturing and transportation price by H&M (Main focus is given on
cost minimization). As compared to Zara H&M offers additional kinds of products. On an average
H&M products are costs at $25 whereas that of Zara is $45. H&M business idea is to supply modern
and high quality product with the best value. Top quality and significantly lower costs attract the
youth and therefore ends up in increase in sales for the company.
 M A R K E T I N G C A S E A N A L Y S I S - H & M | 15

The company has followed a pricing method that has broader pricing range to fit every sphere of
buyer and merchandiser. In order to maintain a median pricing approach they’ve kept a lot of their
stock in discounted section. Under this the extent of their sales will grow ensuring large revenues.

H&M also offers many discounts and schemes on their new merchandise and fresh stocks. It is
obvious that these costing of products are economical and the corporate was able to afford the
discounted price. This also enables restocking products to current and latest fashions.

The important thing to notice is that H&M supplies quality products at lower price because of their
strategy of eliminating the part of intermediary in all transactions. Before the intermediaries used to
buy and sell the raw materials for the company at very high margins. Now H&M has started buying
directly from suppliers in huge amount and this helped in reduced cost resulting in lower selling
prices.

2.7.3. Place:
H&M is one of the highest ranked retailers of clothes in the world with networks which spreads out
through 55 countries. The corporate head office is located in Sweden which takes controls and
manages the products, from production to planning of the merchandise. These products are made at
nearly 800 factories and warehouses located in Asia and Europe. The customers of H&M find the
retail outlets very convenient and it allows them to shop for a variety of different products at one
store. H&M has expanded at a very fast arte on strategic locations that are easy to access and are
reasonable priced. Another advantage that H&M has used is of slower economy that allows them to
secure some good and profitable locations at realistic prices.

The number of store outlets has gone up to 3500 since the first store which was opened in Sweden in
1947. The product distribution of the company consists of purchasing the raw materials from the
suppliers and selling the finished items directly to the stores. The corporate also has a wide network
of online channels where the shoppers can go through all the products and order via internet. This
enabled H&M to have a huge amount of sales especially in 2018.

2.7.4. Promotion:
H&M has always known how important is promotion and marketing for a company to grow and
hence has always taken extra care of their promotional strategies and activities. The advertisements
of their clothing focus on qualitative designs and reasonably priced. The corporate have utilized the
electronic media fabulously by sponsoring many hit shows like MTV. Additionally, they also promote
their brand through celebrity promotion round the world. There are many high-end celebrities who
have associated with the brand like Robert Cavalli and Jimmy Choo.

Internet has also played an important role in the international expansion plans of H&M. Their
advertisements have appeared on many famous magazines like Vogue Netherlands, British GQ and
British Vogue. H&M have also been collaborating with many exclusive designers who have unique
 M A R K E T I N G C A S E A N A L Y S I S - H & M | 16

brands themselves. The corporate also has alliances with the likes of Karl Lagerfeld, Alexander Wang
and recently David Beckham.

Another promotional strategy H&M uses is the use of social media like instagram and twitter to
release their new collections through tweets and instagram pictures. H&M also send its new
collections to celebrities and recently the famous singer Rihanna decided to wear the outfit sent by
the brand. In a recent fashion show models like Edie Campbell, Gigi Hadid and Kendal Jenner have
represented the company H&M.

The promotion of H&M varies in every country depending on what is required. Globally H&M
markets through billboards, magazines, fashion shows and social media. Since, digital media has
become extraordinary vital medium for promotion; H&M is incredibly active on their digital platform
as well as their website and app which interact with their customers. They are conjointly active in
their CSR activities that clearly increase their worth as a brand.

Recently the company has decided for a new marketing plan for their newest collection through
smart phones which is the customers receive SMS that are coupons which they can cash at any outlet
of H&M. The corporate has been benefitting from the ad company’s services such as Mobiento and
Adiento for this purpose. Ads are posted on different portals and major media sites.

2.8. THE ROLE OF DIGITAL MEDIA PROMOTION IN THE SUCCESS OF H&M

Digital media has become a very important platform for brands to market their products and be close
to their target markets. H&M has also grown rapidly in the recent years. This is due to its main focus
on digitalization. Its digital presence has grown to 11 new markets last year and reaching a total of 35
markets. The brand has used digital media for marketing of its merchandise. Social media can help
you attract many new customers and also retain the old ones. Below is the analysis of different
campaigns used by H&M on various social platforms.

2.8.1. FACEBOOK
Facebook is the primary platform for any brand to market and so is for H&M There are more
32 million followers of H&M on facebook. It posts regular updates of new upcoming fashion
products and designs and also any marketing events and campaigns the company organizes.
H&M is one of the brand who uses facebook for regional marketing and branding. The
account serves as a platform to engage its customers old and new. Facebook provides for
communication between the customers and the brand any satisfied or disappointed
customers contact the brand from facebook so it serves as a bridge between the customers
and H&M.

2.8.2. TWITTER
H&M also uses twitter as a platform to market its products. There are different accounts for
different regions and markets for example H&M USA, H&M Bahrain etc. It has more than
8.6m followers. Twitter is similar to Facebook so it can also be used to showcase large size
videos and images.
 M A R K E T I N G C A S E A N A L Y S I S - H & M | 17

2.8.3. YOUTUBE
Another great platform to engage customers and followers is YouTube. H&M has more than
650 videos on its YouTube channel. The main focus is to create long term relationships
through deep engagement and not just marketing their products. The channel apart from
promotion of its products also has “how to” videos. H&M YouTube channel has more than
261K subscribers.

2.8.4. INSTAGRAM
Instagram is another platform where brands can market their business and can showcase its
brands and products beautifully. It is an effective platform for fashion brands like H&M who
use images for marketing. H&M has 3761 posts on instagram with 22.9 million followers
which is a huge number and it reflects the success achieved by H&M by marketing on
instagram.

2.8.5. PINTEREST
Many fashion brands choose pinterest for marketing their products H&M is one of them.
Brands can market products through images from pinterest. People can save pins and
follow boards. There are many different accounts associated with H&M on pinterest like
H&M for men, H&M for kids and H&M denim. Pinterest has helped H&M in marketing their
brand and make many customers and followers.

2.8.6. GOOGLE PLUS

Google plus is a less used platform for marketing nut H&M has used it effectively and
efficiently to engage its customers and followers. Google plus account allows users to post
images, videos and updates about products and events. H&M has more than 6 million on
Google plus and it mainly helps the brand to engage its followers.

This is how digital marketing works for H&M and it can work for different fashion/other
brands too. H&M does not only connect with its existing customers but also attract many
new customers.

H&M launched its first mobile app in 2010.This app is benefitting online shopping in
different parts of the world.

2.9. Sustainable marketing effort

H&M has always been the target of concern about the impact of fast fashion on environment and
the workers who make clothes. Being the second retailer of clothes it’s important for a company like
H&M to move towards more sustainable policies.

 H&M has guaranteed to be 100% climate positive by 2040. This will be done by using
renewable energy and increasing energy efficiency in all its operations. It also includes the
commitment of making the first 2 tiers of its supply chain climate neutral by 2030.
 H&M has been named “one of the most ethical companies” by ethissphere institution.
 It good that the corporate is emphasizing sustainability but it’s not enough as 2030 is far
away and these are just targets.
 M A R K E T I N G C A S E A N A L Y S I S - H & M | 18

 H&M is trying many positive steps to

lessen their impact on the environment.
The corporate is a member of Better
Cotton Initiative which offer a recycling
plan/program which is you can return
clothes from any brand-in store. So far
it’s a positive initiative as we can see in
its sustainability report.
 H&M uses renewable energy as part of
its supply chain and it also aims to
eliminate hazardous chemicals and
solvent-based glues in the
making/manufacturing of its products.
 H&M was also the first to stock up on
“conscious sustainable fashion
collection” in its outlets.
 As of now the majority of the raw
materials used by H&M are not eco-friendly and it still operates under unsustainable model.
 While talking about the labor policies H&M has made some great improvements on its labor
policies in recent years. In 2018 according to Ethical Fashion Report the company received
A+ for its supplier’s code of conduct although this code applies to only its supply chain.
[ CITATION supplychain \l 1033 ]
 Between 1% and 25% of traced facilities across the supply chain pays living wage to workers.
 H&M uses wool from non-mulesed sheep and also bans the use of fur, angora and exotic
animal skins. But it also uses leather specifying the source.
Although H&M is setting goals and targets for sustainable marketing it’s still a part of
unsustainable practices of fast fashion as it manufactures clothes that are worn a few times
and discarded in the name of fashion. Its promotion of disposable fashion and “living with
the trend” has a huge environmental impact.
 M A R K E T I N G C A S E A N A L Y S I S - H & M | 19

2.10. Survey
H&M being the second largest retailer of clothes in the world has 4473 stores and 55 online markets
around the world. Online shopping is one of the most popular activities during this pandemic. The
Covid-19 is bringing a new reality and consumers are expecting quick reactions in this changing
environment. Where physical retail connections are disappearing, online is where most of the
consumers are purchasing.

Goals & Objectives

To assess the need of an online store in Bahrain.

 To determine customers opinion on online stores.

 To determine the percentage of consumers who will purchase products if there is an online
store in Bahrain.

 To explore customer attitudes towards online shopping.

Limitations to the study

The findings of this study are limited to 40 respondents selected from University of Bahrain. These
results cannot be generalized for the entire population.

Profile of respondents
The respondents who took the survey consisted of 14 male and 26 females, the percentage being
35% males & 65% females. 90% of the target group’s age is between 18-24 The remaining 10% is
between 25-34.

Gender Age
Male female 18-24 25-34 35-44 45-54 55-64 65+

6
10%
5
%3
5 90%
%
The targeted audience has the above university majors in which 40% of the students have
the major Management.
 M A R K E T I N G C A S E A N A L Y S I S - H & M | 20

University Major
University
Major
other 5%
Islamic Banking 0%
Marketing 5%
Management 40%
Economics 3%
Banking and Finance 20%
Accounting 28%
0.00% 10.00% 20.00% 30.00% 40.00% 50.00%

Survey questions

How often do you shop online?

How often do you shop online?

never 25%

once every 2 months 45%

once a month 10%

2-3 times a month 15%

once a week 5%

0% 5% 10% 15%20%25%30% 35% 40%45%50%

 According to the survey 18 out of 40 people (45%) shop online regularly (once
every 2 months). The data also reveals that 25% do not prefer shopping online.

What are the recent products that you

purchased online?
Clothes
Shoewear
Accessories 11%
Eyewear 27%
Other
None 18%

7%
7%

29%
 M A R K E T I N G C A S E A N A L Y S I S - H & M | 21

 When asked about the recent products purchased online 29% of respondents
responded with Accessories. 15 out of 40 responded with clothes, percentage being
28%. There is also a fair no of people who purchase shoewear and eyewear.

What are the factors that attract you to your favorite online store?

Product variety
30%; 17%
convenience
33%; 18%
fast and reliable delivery
43%; 24%
mode of payment 15%; 8%
better prices
in stock availability of products 23%;38%;
13%21%

 Over all nearly 43.5% of survey respondents chose Price as the main factor in choosing to shop
online. The second most important factor is fast and reliable delivery. Having a variety of products is
also an important factor with 32.50%. 30% of respondents also think that in stock availability of
products also attracts them to their favorite online store.

What makes you shop online rather than

visiting the actual store?
I don't prefer to shop online 17.50%

To buy products What makeselsewhere

unavailable you shop online rather than visiting the actual store?
17.50%

Easier to compare products 15.00%

Quicker than visiting shops 27.50%

Low prices/beter offers 37.50%

I can shop whenever I want 37.50%

0.00% 10.00% 20.00% 30.00% 40.00%

 When asked what makes respondents shop online rather than visiting physical stores, 37.5% chose
that they can shop whenever they want and equal percentage of 37.5% thinks that low prices and better
offers are the main reason they shop online.

The survey suggests that 27.5% i.e. 11 out of 40 respondents prefer shopping online because it is quicker
than visiting the shops. There is also a17.5% of people who don’t prefer to shop online.
 M A R K E T I N G C A S E A N A L Y S I S - H & M | 22

How familiar are you with H&M?

Extremely
familiar

8% very
10% 23% familiar

somewhat
familiar
20%
not so
40% familiar

not at all
familiar

 According to the survey 40% of the respondents know and are familiar with H&M.
The survey shows that 90% of the respondents are familiar with H&M and have
shopped from there.

How do you know about H&M?

How do you know about H&M?
50% 45.00%
40%
37.50%
30%
20% 15.00%12.50% 15.00% 12.50%
10%
7.50%
0%

 When asked about how do they know about H&M the target group responded with
45% know the company through social media. Out of 40 respondents 15 know about
H&M through a friend. 15% know H&M through TV Ads and billboards.
 Majority of the respondents think that H&M should have an online store in Bahrain
percentage being 88%.
 M A R K E T I N G C A S E A N A L Y S I S - H & M | 23

Do you think H&M should have an

online shopping store in bahrain?
Yes No

13%

88%

Discussion
E-commerce has become the new e-marketing. Due to this pandemic there is a strong connection
between the brands and the digital experience. Shoppers are leaning more and more towards online
shopping for apparel. As shopping is moving online there is a strong need for H&M to have an online
store. H&M has 51 online markets around the world. The corporate’s main strategy is to expand its
markets to strategic locations, but the brand itself was late to expand its online markets and has
been criticized alot by its investors for continuing to expand its physical stores even as its
competitors started their internet sales. But as soon as H&M opened its first online store back in
2010, The company experienced increased sales. When talking about online stores it is important for
any company to evaluate its target population and assess whether there is a need of a certain
service or not. There are many factors that should be considered and all these questions can be
done by conducting surveys and analyzing the results. The main objective of the above survey was to
assess if there is a need for an online market in Bahrain and also How can H&M attract customers if
there is an online store in Bahrain.

 Trend in shopping (Generation Z)

According to the survey there is a trend of online shopping in Bahrain between Generation Z aged
(18-24). The survey shows that 90% of the respondents are a part of generation Z and the other 10%
were aged between 25-34.

 How much shopping is done online?

The data shows that 45% of the respondents shop every 2 months revealing that there is indeed a
trend of online shopping in Bahrain. Further its seen that 37.5% of respondents think that
convenience and better prices/offers are important when comes to online shopping. The second
most important at 27.5% is that online shopping is quicker than visiting shops.

 Better prices are important for online shoppers

 M A R K E T I N G C A S E A N A L Y S I S - H & M | 24

Conventional wisdom suggest that price drives the choice of online retailers and the survey proves
this right as overall nearly 43% of survey respondents chose better prices as the main factor for
choosing an online store and another 37.5% chose fast and reliable delivery as the second factor.

 H&M’s most effective advertising channel (social media- instagram bloggers etc)

45% of the survey respondents chose social media as the medium through which they know H&M,
37.5% know H&M through a friend. This means that e-marketing strategy that H&M uses is highly
effective and H&M should continue using this strategy for its online store in Bahrain as per the need.

 Need for H&M online store in Bahrain

Overall, nearly 87.5% of the survey respondents agree that H&M should have an online store in
Bahrain.

RECOMMENDATIONS AND CONCLUSIONS-

When retail shops integrate the best of the digital experience they have an excellent opportunity to
mitigate sales, build customer loyalty and increase satisfaction. The survey aimed at if there is a need
in Bahrain. The results show that young generation is more inclined toward online shopping and the
consumers chose to shop online mainly on account of convenience and better prices. Moreover fast
and reliable delivery is also an important factor that attracts consumers to online stores. The data
confirms that accessories and clothing is the most popular product buyers shop online this means
that H&M has a scope if it starts an online store in bahrain this will boost the current sales of the
company which is being affected by COVID-19.

1- H&M should focus more on expanding its online markets rather than expanding its international
market.

2- Develop more variety of products like accessories.

3- Increase their online marketing

4- Consider opening more online stores and make strategies accordingly specially in bahrain.
 M A R K E T I N G C A S E A N A L Y S I S - H & M | 25

Works Cited
(n.d.). Retrieved from https://www.arabianbusiness.com/h-m-open-women-only-department-store-
49784.html

(n.d.). Retrieved from https://gfluence.com/the-keys-to-hms-international-marketing-success/

(n.d.). Retrieved from

https://oecdobserver.org/news/fullstory.php/aid/6051/How_responsible_is_H___M_92s_supply_ch
ain__.html

H&M 2020. (n.d.). Retrieved from H&M group official website:

https://hmgroup.com/brands/hm.html

H&M 2020 business insider report. (n.d.). Retrieved from business insider ebsite:
https://www.businessinsider.com/coronavirus-hm-warns-tens-of-thousands-layoffs-job-cuts-
possible-2020-3

H&M foundation. (n.d.). Retrieved from H&M group website: https://hmgroup.com/about-us/hm-

foundation.html

H&M Mission statement. (n.d.). Retrieved from mission-statement website: https://mission-

statement.com/hm/

Hennes & Mauritz AB - Background Information on Hennes & Mauritz AB. (n.d.). Retrieved from
referenceforbusiness: https://www.referenceforbusiness.com/history2/65/Hennes-Mauritz-AB.html
M A R K E T I N G C A S E A N A L Y S I S - H & M | 26