For H&M, Redefining Retail Pays Off

Editor's Note The power of celebrity endorsements, which is a significant retail trend, is one of the key strategies that has contributed to the growth, success, and popularity of H&M (Hennes & Mauritz) as well as

April 6, 2018

Editor's Note

The power of celebrity endorsements, which is a significant retail trend, is one of the key strategies that has contributed to the growth, success, and popularity of H&M (Hennes & Mauritz) as well as to its selection as Best Global Retailer in

License! Global's

Annual Best of 2007 Special Report.

While the Stockholm-based apparel retailer—which has achieved record growth over the past five years—didn't pioneer the concept of celebrity endorsements, it has definitely added another dimension to it by capitalizing on the popularity and cache of internationally recognized personalities.

For example, H&M introduced in April 2007 the M collection by Madonna, followed by collections from

Kylie Minogue, and fashion designer Roberto Cavalli.

The savvy retailer turned each launch into a global design and fashion showcase with elaborate public relations campaigns resulting in widespread media coverage and some very long lines at the checkout counter.

This year, H&M is planning to launch a summer collection

featuring the patterns of Marimekko, a Finnish clothing and textile design company. The retailer is also launching a special collection called "Fashion Against AIDS" from international designers, musicians, and artists.

In addition, the retailer—with 1,500 units in 28 countries—plans to open as many as 15 stores in 2008 and the growth momentum will likely continue for the next several years.

Beyond the celebrity endorsements, H&M's consistent double-digit growth can be attributed to several other key strategies that have helped position the retailer as a global powerhouse and fashion trendsetter:

Global brand.

H&M has redefined what it means to transform a retail store name into a bona fide global brand, something that very few retailers have been able to do.

Marketing.

H&M has the uncanny ability to communicate a consistent and clear message to consumers worldwide. Whether it's a Madonna billboard on Fifth Avenue in New York City or in Hong Kong, the message was simple and the same.

Operations.

H&M can not only transition apparel seasons quickly and efficiently, but it can also rotate new products into stores on a daily basis, thereby driving regular traffic and fast inventory turns better than most traditional department stores.

Price and value.

H&M maintains very aggressive price points and reinforces that value with strong in-store graphics and promotions.

Design.

With more than 100 in-house designers, H&M maintains a formidable edge over other retailers in terms of understanding global fashion trends as well as its customers.

New concept.

Another example of the company's commitment to growth and diversification was COS (Collection of Style), a more upscale ready-to-wear concept that was launched in March 2007 in the UK on London's Regent Street and now has eight stores in Germany, Belgium, the Netherlands, and Denmark.

H&M has established a benchmark for fashion, licensing, and merchandising innovation as well as global grand development. H&M's success and marketing savvy has also reinforced the fact that the macro trend of celebrity endorsements and licensing will continue to be an important strategy for retailers worldwide for the foreseeable future.

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