Table of Contents
Ind (2009) indicates that H&M is a fashion retail organization located in Sweden, and is the firm selling clothes for all categories of population at a reasonable cost. The organization has invested in a number of countries and most of the receptions have always been positive because of their genuine service and the professional approach to product delivery. Fundamentally, the paper gives a detailed examination of the firm’s marketing atmosphere, marketing mix and the recommendations to be utilized to improve their operation on the market.
The Marketing Environment for H&M
H&M is the third largest fashion retailer after Gap Inc, rated as #1 and Zara as #2 respectively. The fact that the organization is ranked as the third most popular fashion retail traders in the world proves that the presence of the organization on the market is justified and very important as it obviously meets the demand of the customers. The implication here is that the market share of the organization is notable on the basis of the employment and high quality product and service delivery. Choi & Cheng (2015), states that H&M began as a women’s clothing retailer Hennes back in 1947 and with the course of time it was able to merge profitably with the Swedish men’s store Mauritz. As the third most influential firm in retail fashion, it has effectively increased its trading operations in Europe, Germany, China, France, Britain, USA, South Korea, Russia and the Middle East. The approach of having such a huge platform has enabled the company to employ 75,000 staff who are working in the over 2000 stores and 37 countries (Tungate, 2012, p. 5-9).
The firm is on the right way because its target segments are equally aimed at children, men and women fashion clothes. The approach is sensible because it allows all types of people to access their ware at a moderate prices and fashion of their choice. The trading route initiated by the firm illustrates that they do not choose who their clients are, but rather are willing to serve all kinds of buyers. It is true because their products are meant for both young and old, hence the confirmation that the firm is thriving on the right marketing path (Walter, 2010, p. 8-12). Furthermore, the organization has opted to invest in home textile business as a route path to develop their produce from a global point of view. The investments in domestic textile products support the conviction that the firm is willing to expand their services to the needs and requirements of the demanding market.
Just like any other firm in the market, H&M, though successfully functioning, also faces certain threats and it has the opportunities to prosper on the market. The firm took the initiative to invest in the United States, but the approach has not been that easy. The organization was able to open a store in Manhattan, but the result did not translate to other locations because some of the new stores were huge (Haberberg et al., 2008, p. 11-13). The threat made the firm to force the management to downsize the stores as the offer significantly exceeded the demand level. Additionally, the firm also realized that business in the United States is different when compared to other regions worldwide. It was noted that the styles in the United States vary between cities and suburban areas. Another challenge faced was launching a colorful apparel collection, but it did not appear to a successful strategy (Griffin et al., 2016, p. 7-11).
So as to fulfill the task, the firm opted to work with the trends being constantly adapted in the United States to the requirements of the local customer as the only way to counter the threat. Furthermore, their ability to use the celebrities like Benicio Del Toro and Molly Sims has helped the firm to maintain a trendy image. Significantly, the current strategies being utilized by the organization have fully ensured that the firm is capable of staying on the satisfactory market share in this world region as well. Consequently, the entity initiated by the firm in the areas of market size, market share and target markets are efficient as the appropriate strategies are implemented to withstand the market competition (Hakonsson et al., 2009, p. 6-9).
H& M Marketing Mix
The firm has initiated the practice of a fast turnaround of the entity when it comes to the issue of taking a garment from the design store shelf to be undertaken within a period of three weeks. The organization is operationally flexible as it frequently monitors its sales and restocks the products on a daily basis as a way of reasonable replenishing popular products. The issues of the branding policy of H&M promisingly symbolize fashion and quality at the best price. Men and women collection emphasize that staying up-to-date, modern and innovative is the norm of life of the fashion-minded people of all ages (Dussart, 2010, 32-36). Fundamentally, the strategy, which is being continually employed by H&M in terms of branding is appropriate because it directs management choices regarding the design of products and also guides in handling their business issues beneficially. When it comes to the issue of packaging, the company has prudently invested in utilizing traditional styles with subdued shades and an inviting appeal. What is more, large quantities of materials are ordered directly from suppliers to permit economies of scale to be transmitted to the clients (Idowu et al., 2008, 24-27).
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The issues related to the pricing strategy are often undertaken via offering prices at a lower range because of the mentioned flexible nature of the company. Additionally, outsourcing apparel manufacturing and the ordering the materials of large direct suppliers and permitting economies of scale to the market has effectively worked in the combination with the pricing strategy of the organization. When compared to its major competitors, i.e. Gap Inc and Zara respectively, H&M offers lower prices for its products, hence, justifying the reason for being among the best on the market. On the matters related to distribution, the firm incorporates a fashionable approach by utilizing the services of a well-known designer and attracting more purchasing power by offering limited edition clothing lines in some of its stores. The experienced management is predominantly responsible for choosing of the firm’s location of stores globally, hence, the reason for basing on the exclusive shopping regions with high traffic is well-grounded.
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According to Jones (2007), online distribution policy is also embodied via their website, which is an indication that it is a fully equipped organization on the matters associated with reaching their clients comprehensively. Communication is also a fundamental entity generating marked results for the firm. One of the approaches incorporated is the combinational utilization of conventional commercial tactics like print advertisements and catalogues and other related novel approaches (Haberberg et al., 2008, p. 31-35). The organization has its own magazine designed to provide the readers with a mix of fashion news and the latest lifestyle trends on the market. The fact of owning and developing a Facebook page and Twitter handle ensures that the organization maintains a social network connection with their fans globally. In addition to this, the company has also invested in YouTube as a popular form of an advertising platform, which has allowed H&M to offer Fashion TV and inspirational films to its potential clients (Hancock et al., 2014, p. 54-58).
Obviously, the implication here is that H&M has invested in communication, advertisement and promotion on a massive scale with the objective of reaching to the modern market by all possible strategies (Parker, 2010, p. 5-9). One of the promotion approaches that H&M uses regularly is a Mobile marketing campaign tailored towards 20-40-year-old female clients. The method is comprised of banner ads placed on the carrier portals and media sites, whose objective is to emphasize the importance of shopping with H&M. Moreover, the inclusion of consumers able to receive alerts and mobile coupons that are redeemable at nearby stores is another fundamental approach being utilized to attract clients to the market (Daft et al, 2010, p. 43-47). Generally, it is apparent that H&M is addressing all ways so as to ensure that its marketing mix elements are profitably attained on the global market.
Analysis and Recommendation
In order to increase the benefits and reduce the prices that H&M clients encounter when shopping, the management needs to incorporate the strategy of teamwork and motivation. The teamwork as a strategy will ensure that the products are designed in a professional way and the motivation will help the managers to effectively encourage their employees to work towards better standards. The motivation for the higher operational achievements can be initiated through increasing their salaries, offering holidays and promoting hard working employees (Schein, 2010, p. 12-14). The outcome of the proposed strategies will guarantee that the firm is able to benefit noticeably more from the market at hand and at the same time, be in the position suitable to reduce their prices, as more stock will be attained from working as a team.
Hines & Bruce (2007), show that H&M can further increase the delivery of their worthy products and services to their clients by including more items that are related to famous people from the local area the store is located in. The rationale for the approach will be considered by the market as appropriate because their culture is utilized and respected, hence, the reason for using their celebrities. Additionally, offering discounts for as low as 5% for every ten pieces of clothes bought at the firm is another efficient method that will help the organization further increase the value of their offerings to the customers on the market. It is effective as the way mentioned demonstrates that the firm is willing to take more risks to satisfy the needs of the client (Epstein et., 2014, p.4-7).
On matters associated to the standardization and adaptation of H&M marketing program, they wisely offer the products of all kinds to all categories of people, i.e. both male and female together with the young and the old. The adaptation is attained through the utilization of the most respected fashion houses as a means of meeting the market location demands (Vogel, 2007, p. 6-9). The advantage of choosing the strategy of standardization is manifested in that the clients feel comfortable because of their needs and requirements being put into consideration. The rationale here is that each client on the market is able to get what they want because of being capable of finding their specific fashion in the market. On the other hand, the strategy of adaptation is also important as it brings the clients closer to the organization for their culture is considered and honored (Schultz et al., 2011, p. 43-46).
According to Amann, Maznevski & Steger (2009), H&M applies a number of marketing programs to obtain their clients’ preferences, which have effectively contributed to a positive feedback. Some of these programs are realized through the use of Twitter, Facebook, YouTube and fashion celebrities. Therefore, for H&M to succeed in the above mentioned elements more investment is to be initiated to fully cover the entire market. By investing more funds in the promotional measures, providing more information on the services and products offered H&M will subsequently be accessible to a wider market. The outcome of the approach applied is that there will be a considerable increase in terms of market share and logically the rise in profits (Evans et al., 2008, p. 21-25).
To sum up, the paper shows that the H&M company has made an attempt to expand globally and the approach can only be attained through the implementation of completely new strategies. Some of the proposed methods are teamwork and motivation. The former is a significant contribution because it allows the employees to work together and as a result, generate better products and services for the market. On the other hand, motivating the personnel encourages them to perform more effectively, hence, be in the position to offer the market the opportunity to purchase what they desire. H&M, ranking the third principal fashion retailer confirms that the firm is important on the market in terms of fashion retail business.