APPAREL QUALITY MANAGEMENT II

ASSIGNMENT
2
Submitted To -
Muhilvannan Nachimuthu
(Ass. Professor)

Submitted By:
Kaavya Jaganathan
Preyashi Kumari
Sadhana Priya A.
Bachelor of Fashion Technology
Semester 6
 ABOUT H&M

Hennes & Mauritz is a Swedish apparel and accessory store known for offering
fast-fashion clothing with over 4,700 stores worldwide in 77 countries. They
specialize in producing fast fashion products with reasonable quality for women,
men, and children. The company has a significant online presence, with online
shopping available in 50 countries and still expanding. The purpose of the online
stores is to attract more sales as the footfall in physical stores decreased.

H&M always comes up with new products that increase the customer's desire for
clothing, that too at an affordable cost. Their only notion is fashion and quality at
the best price.
They have everything that a person may look for, from normal wear to business
suits, sportswear to lingerie sets all at a reasonable price. In our case study, we
are going to discuss the quality of marketing and the work of the marketing team
of H&M.
 PRODUCT AND ITS MARKETING

Their product strategy is well thought of. Importance is given to quality and
fashion according to trends. It has a well-structured product line. Known for fast
fashion clothing stores, the brand never misses a deadline on introducing new
product lines.
There is something for everyone and the brand has something new to offer every
time you step in, and that too at a cost-effective price. Before a season’s release
they make sure of creating enough curiosity and buzz. Collaborations have
proved highly effective for the brand in marketing their products, for example,
their collaboration with Sabyasachi titled SabyasachiXH&M had some amazing
designs to offer.

CUSTOMER TARGETING

The target customers of H&M are a broad group of consumers who follows
fashion trends. The price points allow consumers to follow the newest trend
without breaking their bank, which attracts mostly working class, middle class,
and students who consider shopping as pleasure. Although H&M offers men and
kids clothing, a large segment of the target market is women. The target market
of H&M online stores shifts a little from the physical stores. Online shopping
mostly targets consumers who are in the working class and have a busy
schedule, having shopping done in the comfort of your own home and items
shipped to your doorstep is unquestionably a plus. Younger people also use
online shopping to buy clothes as it is of greater convenience to them.
The stores of the brand are done up aesthetically. The ambience is youthful with
employees being humble to customers. The fashion is arranged decently and the
stores showcase a variety of accessories and clothes in all ranges.
 SEGMENTATION STRATEGY

H&M almost already reached various cultural, religious and lifestyle all
over the world.
Segmented into class- from middle class to high society by rendering
low-cost price products to extravagant products.
Segment by age- H&M literally covers all genders from the age group
of 15 to 30 years old in presenting them fashionable products and
accessories.

TARGETING STRATEGY

H&M basically targets fashionable and trending consumers who are very
much interested to spend their money on purchasing high-quality clothes.
Notably, H&M highly aims to target women, as they usually invest a lot of
money in purchasing fashionable items- clothes, accessories, shoes,
Garment care etc. at an affordable price.

POSITIONING STRATEGY

H&M gives access to its premium apparel range at an affordable price.

That’s the reason why different nations love the brand. The brand’s target
age group of 25-35 attracts to their high-quality products.
 COMPETITOR ANALYSIS

According to H&M full year report, their competitors include other affordable
fashion apparel retailers such as Zara, Gap, Uniqlo, Topshop, and Forever 21.
These competitors have similar marketing strategies as H&M, they all target the
market segment of upper middle class by delivering branded name associated with
their products.
The pricing of H&M is comparatively less than its major competitors Zara and
GAP. H&M makes this low-price strategy possible with its cost minimization
strategy by lowering transportation and manufacturing costs.
So, one prominent thing that sells H&M is their pricing.
 H&M MARKETING DEPARTMENT

The Marketing Department is H&M's own global advertising agency, where they
create all of their multi-channel campaigns and produce their marketing materials.
This is where their brand is built and nourished – making sure everyone loves
fashion at a great price just as much as they do.

The department consists of Project Management, Production Management,

Purchase, Art Buying and Fashion Coordination, all working together to provide
their global market with top-notch advertising materials covering everything from
bags and packaging to campaigns and promotional products. Basically, marketing
creates attention for their brand, and builds likeability.
 H&M MARKETING TEAM GROWTH

The brands within H&M Group work with some of the world’s best creatives to
create campaigns that inspire a wide and diverse target group across our 74
markets. Marketing by the brands has a major impact; therefore, they need to plan
and produce campaigns and communications material consciously.

H&M Group’s advertising campaigns, look-books and communications material are

produced inhouse in co-operation with top-ranked creatives from all over the world.
Their ambition is always to work with models and talents of diverse looks, ages,
and cultural backgrounds to stay relevant to all our target groups. Collaborators
are selected in line with our strict internal guidelines, ensuring that models
depicted portray the current fashion in a positive and healthy manner.
PRIMARY ACTIVITIES

1. Inbound Logistics :
This includes material handling ,storage ,transportation ,communication, testing,
information systems. It has production offices place the order with the right supplier
and low price ,but the best quality .

2. Operations :
The only thing which H&M makes is design. It has 100 inhouse designers and 50
designer work with the patent.

3. Outbound Logistics :
The outbound they have is the transportation ,packaging, communication.

4. Marketing and Sales :

Marketing is split into price ,quality , commercials and locations of shops . It
targets the medium class people.

5. Service:
H&M has loyal and skilled and loyal employees and kind consultants ,who
are available for the help needed by the people . It offers product mending as
well .

Supply - Chain Analysis

 VALUE CHAIN ANALYSIS OF H&M

SUPPORT ACTIVITIES

1. Firm Infrastructure : H&M holds 2500 stores all over the world .It has its
operation in 25 countries with 16 production offices . They follow the string
values .
2. Human Resource Management : It is very important to reach the goals . The
employees satisfaction reflects the results . H&M believes in team work and
making and make the workers to take responsibilities of everything they do in the
company .

3. Win-Win Model: Employees the local people and offer them to work in any
place they wish to in H&M .

4. Technology: Online shopping is available. The main advantage is they keep

attention to the keep attention to the changing customer needs with the modern
designs and innovations .
5. Procurement : H&M needs labor ,material and energy. It doesn't own a factory
or unit ,which reflects with it's profit with a small change in prices .
The service profit chain of H&M (Internal and External
Customer )

Internal service quality (the

working environment
,workplace)

Employee Satisfaction

Employee Employee
productivity retention

External service value

Customer Satisfaction

Customer Loyalty

The service-profit chain establishes

relationships between profitability, Revenue Growth
customer loyalty(external customer),
and employee satisfaction, loyalty,
and productivity(external customer).
Profit and growth are stimulated Improve profitability
primarily by customer loyalty.
Market analysis in the Marketing strategy of H & M

As the company operates in the fashion industry which has low product
lifecycle, the markets operate with the risk of unsold inventory due to
emerging & changing fashion trends.

Although the company is being present in the limited number of countries but
it is in expansion mode, the company has planned opening 400 branches in
the year 2017 and is planning to strengthen its online marketplace channel.

Competitive analysis in the Marketing strategy of H & M

As the company business model is majorly based on the physical stores

where footfall is decreasing quarter on quarter, the company is not able to
capitalized on the same whereas its rivals such as Inditex, the owner of Zara,
Chanel, Dior and many others are able to outperform due to the efficient
supply chain helping the companies into adopting the changing demand
pattern.
The Clothing and apparel fashion industry is by and large facing competition
from the unorganized sector in the developing nations.

Brand equity in the Marketing strategy of H & M

The brand with its extensive product lines is competing with the well known
Retail brand of the Industry creating high visibility in the market.
H & M has been ranked 36th in Forbes magazine list of World’s Most
Powerful Brands.

The Apparel/ footwear Retail Brand has been valued at $ 39.9 billion (market
capitalization value method) generating revenue of $ 22.67 billion.
H&M has been ranked 20th in Corporate Knights’ annual index of the Global
100 Most Sustainable Corporations in the World as compared to 75th in
2016.
Customer analysis in the Marketing strategy of H & M

With wide and varied range H & M serves the large array of customer group
ranging from kids, men & women.

Customers of H & M are primarily from the upper-middle-income group and

upper-income group and are in age group of 15-40 years. Diversity in the
collections of H & M gives freedom to the customers to choose and explore
their own personal style.

H&M Promotion Strategy

The promotional and advertising strategy in the H&M marketing

strategy is as follows:

• TV advertisements: H&M comes with creative ads which focus on its latest
innovative designs. Each brand handles its own marketing decisions. The ads are
telecasted at regular intervals and on channels mainly watched by youth, to
increase its awareness.

• YouTube: H&M has its own YouTube channel where it comes up with unique ad
campaigns to engage with the customers.

• Digital Marketing: It indulges in excessive search engine marketing and social

media marketing to convert the potential buyers into consumers.

• Promo codes and discounts: Promo codes and discounts are offered during the
end of season sale. The discounts are offered on both online and retail stores.

• PR: Parineeti Chopra opened the first H&M outlet in India. Such stunts generate
quick publicity for the company.
Sponsorships: H&M signed deal with The Weeknd, sponsors Caitlyn Jenner,
sponsors Musee Des Arts Decoratifs, Creative collaborations with high end
designers and style icons, Collaborations with pop stars and sport stars.

These promotion and communication strategy will tend to meet the consumers
form different places everywhere, especially those target markets or the
consumers in the working environment.

MEDIA FLOWCHART OF H&M MARKETING CAMPAIGN

July August Sptember October Nov. Dec.

Once Once
Magazin Once a Once a Once a Once a
a a
e Ads month month month month
month month

3 ads 3 ads 3 ads 3 ads

3 ads per
per per 3 ads per per per
Radio peak
peak peak peak peak peak
ads driving
driving driving driving hrs. driving driving
hrs.
hrs. hrs. hrs. hrs.

Ads Ads Ads

Ads Ads
throug Ads throug through
Social through- througho
hout throughout hout out
Media out each ut each
each each day each each
day day
day day day

catalogu
e with Once Once
Once a Once a Once a Once a
promotio a a
month month month month
nal month month
coupons
 Market Gap Analysis

H&M can improve its sales by marketing, the student team by conducting
market gap analysis. Their primary research should be done by taking
public poles and it is found the following market perceptions:

82% of brands are not inclusive all size clothing

65% feel insecure due to the lack of size availability in brands
55% of users are not aware that H&M has all sizes

Conclusion

H&M is a global fashion behemoth and has an amazing reach and market
share. They already have a tremendous amount of marketing strategies in
place and are doing very well implementing digital marketing strategies. With
the rising competition and increase in microbrands and websites, H&M has
to improve its marketing strategy to go hand in hand with the times.
 References

http://faculty.wwu.edu/schadeb/dsgn360/website/images/ex
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https://eduzaurus.com/free-essay-samples/the-target-
market-of-hm/
https://www.marketingmind.in/marketing-strategies-to-
learn-from-hm/
https://startuptalky.com/h-m-marketing-strategy/
https://marqueex.com/marketing-strategy-of-hm-selling-
passion-for-fashion/
https://www.marketingmind.in/marketing-strategies-to-
learn-from-hm/
https://issuu.com/asciupider/docs/h_m_digital_media_final
_project
https://15writers.com/sample-reports/strategic-marketing-
analysis/