INTRODUCTION

The history of H&M, the world’s largest fashion retailer & fashion company can be traced back
to Sweden in the 1940s. In 1947, the first Hennes store opened in the Swedish city Vasteras was
the founding stone of the H&M group which has come a long way since then. It started its journey
with the idea of selling women’s wear- which turned out as an evolution in the fashion industry.
The year 1968 was the landmark year when the name of the store got changed from “Hennes” to
“Hennes & Mauritz” as it started selling clothing to men & children as well along with women’s
wear.

The growth of H&M was not limited to the boundaries of Sweden, it laid the foundation for
international expansion. H&M at the end of the year 1998 got an invincible hold on the fashion
industry throughout Europe. The 75 years of journey of H&M from a single store in a Swedish
city to a giant industry consisting of 4801[1] (Smith, 2022) stores throughout the globe has sped
up the growth of the fashion industry by several folds.

The secrets behind its global leadership in the fashion industry can be found in its unique business
approach which helped them to stand out against all the competitors in the market. Their “Cheap
& Chic” [2] (H&M Group 2021) business model focused on providing high & quality fashion at a
much lower price than the other competitors which helped them enormously in gaining momentum
in the competitive market. But later on with new dimensions of consumer behaviour and the huge
growth of online fashion retailers, the susceptibility of the business approach of H&M was
questioned. A faster solution was required to keep pace with the growing industry. Apprehending
the growth of technological innovation and the online fashion market, it started focusing its growth
on the digital market to reach the World at a tremendous speed. This paper is aimed to investigate
the reasons and key factors behind the enormous growth of the brand instead of several obstacles
and high competition among the brands rising with the time.
The main motto of H&M is to provide quality fashion at the best price which not only attracts the
crowd with big pockets but also the crowd belonging to the middle class. Their attempt to make
fashion accessible to everyone has brought the evolution in the fashion industry which previously
was confined only to a few privileged people. Their vision of scaling innovation, promoting
transparency, and getting engaged in industrywide progress makes them extraordinary against all
the other competitors like- Inditex (ZARA), Gap Inc., UNIQLO, Zalando, Asos etc.

Fast fashion is a retail strategy which promotes such products which can quickly adapt to current
and emerging clothing and fashion trends [3] (Sull and Turconi 2008) by reducing demand
uncertainty and variability and promoting increased levels of fashion consumption. This is a
perfect solution for changing consumer behaviour. H&M has achieved the position as World’s one
of the largest fast fashion retailers, based on certain fundamental ingredients which are-

 Believing in one team,

 Having trust in the people and embracing diverse perspectives,
 Strong business mindset: entrepreneurial spirit,
 Making constant improvements to move forward,
 Being cost-conscious by responsibly utilizing resources,
 Being straight-forward and open-minded,
 Aiming for simplicity [4] (H&M group 2022).

The implementation of these fundamental principles is helping them to grow extensively, if we

observe in terms of global revenues, it will be around 209,921 billion SEK (237,569 mil $), +19%
reported in 2014 [5] (Annual report 2016a), operating in 64 markets, has over 148,000 employees.
The below illustration [6] (H&M Group 2022) has been taken from H&M’s website where the
number of stores and markets were given as per the data till 31 August 2022. COS, Monki,
Weekday, & Other Stories and ARKET are the branches of H&M group which offer Global selling
to enable customers to shop online. These give ample opportunity to the consumers to fulfil their
demands with the upcoming trends.

BRAND STORES STORE MARKETS ONLINE MARKETS

H&M 4,122 77 57
COS 264 48 38
Monki 89 18 30
 Weekday 57 16 30
& Other Stories 76 25 33
ARKET 25 10 32
Afound 0 0 7
H&M HOME 31 55 43

There are several key factors which have been playing a major role in this enormous success.
Such as-

A. Marketing and Branding through social media

In today’s world, Social media plays a huge role in these brands. Its importance can be
vividly observed after the pandemic. It has a high potential to influence consumer
behaviour. For instance, if a superstar like Chris Hemsworth is wearing some branded
shoes and posting them on his social media platforms, it will bring a huge crowd to that
particular brand. H&M has a strong social media presence in association with several
famous designers like- Stella McCartney, Victor &Rolf, Alexander Wang and many more
high-profile celebrities. This kind of marketing and branding led the path of H&M to get
the 30th rank among the top 100 most valuable brands throughout the world with a brand
value of US $ 16.82 bn [7].

B. Unique Business model

H&M has unique business model which is quite different than other existing brands. It does
not have manufacturing units, rather it outsources its production to independent suppliers
around the world. H&M has been working in cooperation with manufacturers throughout
the globe in developing economies for its basic items, which ultimately minimized its
overhead but still provided the quality fashion at best price which has been worked out as
win-win situation for H&M group.

C. Best Store Locations

Providing the best possible shopping experience is one of the essential requirements for
fast fashion retailers. The best location of shops in a city or small town shopping centres
will be able to grab the attention of more crowds conveniently. It will not only promote
good communication between the Customer and seller but also will strengthen the brand.
 H&M has been strictly adhering to this principle since its nascent stage which has
ultimately laid the foundation for immense growth.

D. Corporate Social Responsibility

Corporate social responsibility (CSR) is a self-regulating business model which helps a
company or corporation to be socially accountable to itself, its stakeholders, and the public
[8]. This practice makes the companies conscious of the impact they are causing on the
society.
H&M has been working tremendously to maintain its Corporate social responsibility.
They have been taking several actions through its various chains to fulfil their
responsibilities towards society, such as adopting ethical practices, using environmentally
friendly sustainable materials, using the resources responsibly etc.

E. Proper Human Resource Utilisation

Human resource is the main base upon which any industry’s foundation can be laid. Hence,
its proper utilisation is a necessary part of the textile industry or any industry. “Because
when you grow, we grow.” [9] (H&M group 2022) - with this tagline H&M promotes
individual growth of its employees which is not only just favorable for an amicable
workplace but also the overall growth of the company.

F. Sustainable strategies
According to the World Commission on Environment and Development, sustainability
[10] is defined as development which fulfills the requirements of the present generation
without compromising the requirements of the future generations.
The fashion industry is labor-intensive and it has been hugely impacting the environment
and society, hence it becomes crucial for such industries to bring sustainable strategies to
maintain the generational sustainable growth of mankind. It includes using eco-friendly
materials, sustainable manufacturing method, green distribution, green retailing, and
ethical consumers [11]. Sustainable manufacturing has been getting related to human rights
and environmental protection. Consumers have been getting concerned about the social
 consequences of their purchases in view of human rights violations in apparel
manufacturing.
H&M has taken several sustainable approaches which have been vividly grabbing the
attention of the customers. H&M has been incorporating organic cotton for many years. It
has been extensively involved in the global project, called Better Cotton Initiative (BCI),
which promotes better farming techniques to cotton farmers to get better quality of cotton
which is an important step towards sustainable development. In 2020, they have reached
their goal of sourcing all their cotton from more sustainable sources [12] (H&M Group
2022). Their aim is to use recycled materials or other sustainably sourced materials in their
products is not only promoting sustainable growth but also giving them an edge over the
other textile industries. H&M also has been cooperating with the World Wide Fund for
Nature (WWF) to save water, environment which helps to improve the utility of natural
resources throughout the textile production cycle. They are also working to emit zero waste
from the organization to landfills. H&M Group has restricted the use of chemicals and has
been working vigorously to dissuade hazardous chemicals from its production [13] (H&M
Group 2022). These sustainable strategies are helping H&M immensely to gain popularity
among conscious customers.

G. Rapid Internationalization & Digital Expansion

The presence of H&M in all the continents shows its rapid growth. Since 1997, it has been
showing rapid expansion throughout World. Its business model to evaluate market
structure and opening new shops in the corners of the World to provide fashion at the best
price has been helping them to sustain itself in this competitive market.

REGION STORES (31st Aug 2022)

The Nordics 405
Western Europe 1,085
Eastern Europe 654
Southern Europe 628
North & South America 733
Asia, Oceania & Africa 1,159
 Total number of stores: 4,664

The above illustration [14] (H&M Group 2022) shows the rapid internationalization of the
H&M group. As per digital expansion is concerned, H&M group has heavily invested in
online platforms thinking about the long run. Its presence in online platforms has gained
quite popularity which is necessary to cope up with the rapid technological development.

CONCLUSION

The whole study examines the success factors working behind the enormous growth of H&M and
its successful 75 years. H&M Group is positioned as 4th out of 250 brands as per the 2022
Fashion Transparency Index [15]. In the 2021 Material Change Leaderboard, H&M was
also recognized by Textile Exchange as one of the leading companies that have been using organic
cotton and recycled cotton in their products [16]. H&M was also awarded the Green Traffic Light
in the Ecogain Biodiversity Index in 2021 [17].

This enormous growth and several achievements have brought H&M into the spotlight, which has
been collecting lots of attention from customers. The unique strategy to adapt sustainability has
been helping them to stand out. With the increasing consumer awareness of sustainability,
developing a sustainable supply chain is an important strategy for the textile and apparel industry
which has been successfully adopted by the H&M Group. It has implemented sustainable
programs, Conscious Action, in which eco-materials are used and promoted, sustainable
manufacturing methods with a high sustainable consciousness are adopted, green distribution
approaches with fewer emissions and energy use are used, and green retailing and educating
consumers are promoted [18] ( Shen 2014). Hence, it can be vividly observed that not a single
factor, several factors are there which are working enormously behind the growth of the H&M
group. These factors have made H&M the world’s one of the best fast fashion retailers.

The whole investigation is giving us the lesson that in this competitive world where consumer
behaviour is changing rapidly, where technology has been upgrading now and then, to sustain
oneself in this textile and apparel industry, one has to be creative enough, one has to adopt
sustainable strategies to attract the customer-traffic, to compete with the other existing
competitors. There are a few weaknesses which are needed to be addressed by H&M to be
present in the competition. It needs to adapt itself to the evolving trends in the market or else
it will lag in the industry as there are several entrants in the market coming up with new
creative ideas. As, we know the theory of evolution says “Survival of the fittest”, if one is not
fit enough, he will not be able to survive. Hence, to sustain themselves in this industry, the
brands have to come up with unique ideas to survive in this competitive market.

REFERENCES:

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