Strategie de Piata H&M

H&MIMC Project Part 1

Ruben De Avila • Rachael Podbielak • November 30, 2012

H&M • Integrated Marketing Campaign 1

Table of Contents

Executive Summary! 4

Situation Analysis ! 5

Current Brand Position 5

Unique Customer Benefits 5

Current Markets 6

Industry Overview 6

The Problem 7

Analysis of Primary Competitors! 8

Zara 8

Forever21 8

Topshop 8

Urban Outfitters 8

SWOT! 9

Strengths 9

Weaknesses 9

Opportunities 9

Threats 9

Target Audience! 10

Brief Description/Background 10

A-Quad! 11

Attributes 11

Attitudes 11


Allies 11

Adversaries 11

Media Communication Plan! 12

Communication Goal 12

Strategies 12

Tactics 12

Business Objectives 12

Creative Strategy! 13

Brand Promise 13

Main Ideas To Communicate 13

Call To Action 13

Online Profile! 14

Consumer Information 14

Profile Security 14

Style Quizzes 14

Example Style Quiz 15

Mobile Application! 16

Smart Recommendations 16

QR Codes 16

Loyalty Program! 17

H&M Plus 17

H&M Loyalty Cards 17

Point Earning Opportunities 17

Reward System 18

Tiers 18


Community Forum! 19

Advertising Schedule ! 20

Timetable 20

Promotion Budget! 21

Evaluation! 22

Appendix! 1


Executive SummaryH&M is the second largest clothing retailer in the world that is based out of Sweden. It is a

company that values economic, social, and environmental sustainable initiatives. They provide

consumers with a variety of fast-fashion, high quality clothing at low prices.

H&M’s biggest challenge lies in the retailers inability to establish its stores as a one stop shop; a

place where consumers can easily create and purchase an entire outfit. Currently, target

consumers view H&M as a place to pick out a single piece of clothing that complements their

current wardrobe. The primary reason why consumers are reluctant to purchase their entire

wardrobe at H&M is due to their view of the clothing as throwaway fashion; clothing of

inadequate-quality and low-prices that can be discarded. H&M fails to successfully communicate

their high level of quality to consumers.

We want H&M’s borderline customers to view H&M as a retailer that provides high quality, fast-

fashion clothing at affordable prices, while recognizing H&M as a one-stop-shop. We want to

change borderline customers into core consumers.

The target audience consists of females who consider themselves fashionable and are between

the ages of 17 and 26. They usually shop at four or more stores and want to update their current

wardrobes. They want to be unique, but stay current with the trends.

To address this challenge, we will create a loyalty program and a mobile application to encourage

the target audience to use H&M as a one-stop shop. The mobile application will include member

log-ins that will keep track of the benefits they have earned, as well as their previous purchases to

help customize apparel recommendations. The recommendations will include clothing, bags,

accessories, and shoes. It will create an entire look based on user interaction with in-store QR

codes and purchase history.

The entirety of this campaign, based on H&M’ previous advertising budgets, will cost $1 million.

It will include the execution of a new loyalty program, a mobile application, a competition, and

the creation of a new forum. All of the components of this campaign can be integrated and used

together at the consumer’s discretion to create a customized user experience.


Situation Analysis

Current Brand Position

H&M is a retailer that is looking to provide consumers with fashionable, high-quality clothing at

the best price possible. They offer “fast-fashion” clothing, in other words from runway to racks

in record time, and sell European influenced clothing in the American market. Additionally,

H&M carries clothing in a variety of categories including women’s casual, men’s business,

children’s wear, footwear and accessories.

The company is the second largest clothing retailer in the world, and actively engages in E-

retailing. H&M is also economically, socially, and environmentally sustainable.

Unique Customer Benefits

Customers have access to fashionable clothing almost immediately after new trends have been

publicly released. H&M offers multiple apparel categories including anything from footwear to


accessories to allow for one-stop shopping. Moreover, the quality of H&M’s clothing and the

integrity of the company are not affected by its affordable prices.

Current Markets• Global: Asia, Africa, Europe, North America

• Women’s Apparel• Men’s Apparel

• Children’s Apparel & Footwear• Accessories

• Footwear

• Cosmetics• E-commerce

! The online market is constantly growing and mobile shopping through the use of

! smart phones and tablets has become increasingly common. 64% of consumers are

! interested in scanning products with smart phones to get more information while 76% of

! consumers are interested in instant offers via smart phones for things they were already

! looking for. Additionally, popular mobile apps include mobile coupons, store

! information, mobile self-checkout and digital receipts (Appendix A-1).

Industry Overview

The multinational retail clothing market consists of thousands of retailers competing for market

share. Within the United States, hundreds of retailers are competing to produce high quality,

affordable clothing to meet the demands of consumers.

The industry determines the trends and fashions that will be available each season. Every season

the trends change and the industry leaders dictate what is fashionable, which determines that the

past season’s fashions are no longer trendy. As a whole, the industry usually pushes consumers to

purchase more clothes than are necessary for the sake of fashion.

Additionally, the apparel retail industry is shifting towards a greater online presence to become

more efficient and timesaving for consumers. This online “store” is interactive and can reach

more consumers than a physical location. Also, some retailers are beginning to incorporate


U.S. Apparel Market

mobile phones into the consumers shopping experience by developing applications and creating

profiles on social media sites.

An industry trend for consumers is to be budget smart, discount searching and thrifty.

Consumers want to feel like they saved a bundle without compromising quality. They also want to

feel that they got the most out of their money and came away from a quality shopping experience

with clothing that they love.

The Problem

H&M’s current brand promise is not aligned with the target consumers’ opinion of the brand.

H&M fails to translate that their fast-fashion quality clothing is of high quality. They are no

longer relevant in the consumers’ mind and consumers do not feel that the money spent matches

the quality of the clothing. H&M fails to successfully communicate their main unique selling

points.


Analysis of Primary CompetitorsZara

• Fast-fashion

• Multinational retailer, part of Inditex - Flagship in Spain

• Human rights concerns: sweatshops, slave labor, shop staff abuse• Sell apparel through brand website & has smart phone application

• Equal price range to H&M

Forever21

• American chain, globally located

• Low quality, fast-fashion clothing

• Merchandise does not have uniform size specifications• Sell apparel through brand website & has smart phone application

• Equal price range to H&M

Topshop

• British multinational retailer, part of Arcadia Group

• Moderate quality for fashionable clothing

• Sell apparel through brand website & has smart phone application• Equal price range to H&M

Urban Outfitters

• American Chain, global locations

• More hipster fashions

• Includes luxury brands and designer collaborations

• Sell apparel through brand website & has smart phone application• Slightly higher in price than H&M, same target market


SWOTStrengths, Weaknesses, Opportunities, Threats

Strengths

• Leader in Global market (2nd)• Affordable & high quality clothing• Fast-fashion• Throw-away fashion• Strong presence in multiple markets (Women, Men, Kids…)• Celebrity endorsements• Strong social media presence• Price does not effect quality• Company website and blog

Weaknesses

• Brand awareness of individual apparel brands sold in stores• Fit is not consistent due to variety of manufacturers and supplies• Customer service

Opportunities

• Promote current sustainability practices• Increase word of mouth in both female & male audiences• Online market including social media• Mobile Marketing

Threats

• Secondary competitors such as Express, Charlotte Rouse• Primary competitors: Forever21, Topshop, Urban Outfitters, Zara


Target AudienceBrief Description/Background

The targeted consumers are fashionable females who are highly concerned with their personal

style. They are between the ages of 17 and 26 and typically shop at four or more stores. These

females consider themselves fashionable/trendy and are looking to update their wardrobes with

current trends. They want their style to be unique and consistent with their own personal self-

expression, but still adhere to current-season trends. The target audience wants quality clothing

that lasts seasons beyond its purchase date and demands fast-fashion in order to keep up with

current trends.

Moreover, these women are looking to purchase affordable, fashionable clothing and want to

expand on their current wardrobe with clothing, accessories, purses, and shoes to provide them

with a variety of looks. The consumers are not highly brand loyal; rather they shop at multiple

retailers in search for the perfect fashion pieces. They shop anywhere from four to six stores on

average. The target consumer values price, high product quality and a large variety of apparel.

They like retailers with loyalty programs and good customer service.

The target consumer reads fashion magazines and owns a smart phone. When the consumer goes

into a store, she has the intent to shop and is interested in expanding into mobile retailing.

Additionally, her friends’ opinions are very important to her and she is heavily influenced by

word-of-mouth. She is interested in every detail of her outfit, from her nails to the shoes on her

feet. Every piece of her outfit has been carefully selected to establish an updated fashionable

look.


A-QuadAttributes, Attitudes, Allies, Adversaries

Attributes

• High quality clothing at affordable prices

• On average, lower prices than competitors

• Fast-fashion that meets consumers need for current trends

• Clothing that lasts beyond the season

• Socially, economically, and environmentally sustainable

• High retailer brand awareness

Attitudes

• Fashionable and trendy

• Seeking quality, fashionable clothing at bargain prices

• Confident in outfit choices and expression of trends

• Strong desires to constantly update wardrobe

Allies

• Fashion outlets (i.e. magazines, blogs, retailer websites)

• Celebrities

• Target consumer’s close circle of friends and family

Adversaries

• Fast-fashion retailers

• Lower-priced retailers

• Manufacturers that sell directly to consumers


Media Communication PlanCommunication Goal

We want H&M’s target audience to view H&M as a retailer that provides high quality, fast-

fashion clothing at affordable prices. We want to align the target audiences’ current perception

of H&M’s clothing quality with the consumer’s desire for high quality clothing.

Strategies

• Stress that quality is not affected by low price

• Utilize global presence on social media websites

• Incorporate global trend of mobile retailing

• Highlight large variety of trendy clothing options as complete outfits

• Make borderline customers into core consumers

Tactics

• Create integrated social media photo competitions using Facebook and Twitter

• Establish a loyalty program

• Design a mobile application that can be integrated into consumers’ shopping experiences

• Create an open forum to facilitate consumer discussions

Business Objectives

• 10-15% growth in number of stores by December 2014

• Gain 1,000 more Facebook likes and 2,000 Twitter followers

• Increase sales in Women’s Casual by 5% and in Women’s Formal by 5%

• Increase sales in Accessories by 2% and Footwear by 1%

• Become largest clothing retailer in the world by December 2015


Creative StrategyBrand Promise

H&M gives consumers the opportunity to convert runway fashions into their own unique style

with affordable, high quality fashion apparel and accessories.

Main Ideas To Communicate

•H&M is a one-stop-shop for all your fashion needs

•H&M provides low cost apparel and accessories without compromising quality

Call To Action

Encourage current consumers to continue shopping at H&M. These consumers should expand

their purchases beyond apparel categories and being purchasing accessories and footwear. We

want consumers to purchase entire outfits and complete their wardrobes with H&M.


Online ProfileConsumers will have the opportunity to sign up for an online profile on H&M’s website and

through the mobile application. Additionally, there will be flyers in stores explaining how to sign

up online. Consumers will be asked to provide basic demographic information and to take simple

style quizzes. Previous purchase information will be available for the consumer’s use.

Additionally, there will also be a link to an optional survey where consumers can let us know

about their shopping experiences and how we can improve their next H&M experience.

Consumer Information

Basic demographic information collected from the consumer will include gender, age, address,

e-mail address, and H&M store most frequently shopped at. Consumers will also be asked what is

their preferred method of contact and will be asked to provide the related contact information.

They will also have the option of storing credit card information in their profile to make their

online and mobile app purchases smoother and more efficient.

Profile Security

Consumers’ information will remain private to H&M and will not be sold to outside vendors. The

target demographic can be assured that the website and mobile application are safe and secure.

All information provided by consumers will belong to H&M and only H&M.

Style Quizzes

These short quizzes will include pictures of H&M models in H&M clothes. Each model will

represent a variety of styles, and the consumer has the option of choosing which photos are more

appealing to them based on personal style. Additionally, other individual items of apparel,

accessories, and footwear will be compared side by side. Once the 3 minute quiz is complete, the

profile will be updated with the unique style choices of the consumer. This quiz can be retaken as

many times as the consumer would like to remain up-to-date with the consumers ever changing

style.


Example Style Quiz


Mobile ApplicationCustom Shopping Experience - Unique Recommendations

Going along with the national trend of mobile shopping (Appendix A-1), we feel that H&M

should expand their current mobile application to include a new custom shopping experience for

consumers. This application will allow users to keep track of their previous purchases and will

use that information to make recommendations about new clothing that would fit the consumers

unique style. These recommendations would show complete outfits including apparel,

accessories, and footwear. While in store, consumers can scan QR codes that will be printed on

tags. Consumers must create an online profile in order to efficiently use the application.

Smart Recommendations

Once users create an online profile, which is available through the application as well as the

website, and take the style quizzes their style choices will be stored in their profile. Based on

their answers, consumers will receive unique apparel, accessory, and footwear

recommendations. While browsing these recommendations through their smart phones,

consumers have the option to reject a recommendation they do not like. Once rejected, the

mobile application will ask if it was due to a difference in style or general dislike. This

information will be stored on the users profile and will update the next selection of

recommendations to include this new information.

QR Codes

QR codes will be available for all apparel, accessories, and footwear in store. These QR codes can

be scanned by the mobile application on smart phones and will access information about the item

scanned. This information includes price, alternative color options and recommendations on

how to complete the outfit. The consumer will be able to browse through clothes in store and on

the mobile application simultaneously. This will create a unique shopping experience for the

consumer and make the store easier to navigate.


Loyalty ProgramLoyalty Card, Points, Reward System, and Tiers

H&M PLUS

H&M’s target market believes that customer service is an incredibly important part of the

shopping experience. However, customer service through the use of employees can be very

expensive. To keep employee costs low and add the value of customer service, we believe that

loyalty program should be implemented. This loyalty program will consist of consumer cards,

point earning deals, unique rewards, and tiers. It will be an opt-in program and will protect

consumer privacy by keeping their shopping habits and information private.

H&M Loyalty Cards

Consumers will have the option to participate in H&M’s loyalty program. The program will be

free for consumers and will have guarantee privacy protection. The card will be the physical

manifestation of an online profile, tiers, points, and benefits. At check-out or online, consumers

will be asked if they would like to be involved in H&M Plus. If a consumer agrees, she will be

asked to fill out a basic survey asking for information such as demographics, current shopping

habits, and personal opinion about H&M. The consumer will then receive a plastic card that will

document all of her purchases and will be tied into her online profile once registered. Tiers,

points, and benefits can be monitored online with the use of the profile.

Point Earning Opportunities

Consumers will earn points through every purchase they make. Every dollar spent will be equal

to one point. Additionally, there will be days where everything is triple points or certain

categories will be double points. At the end of each season, seasonal merchandise will be triple

points to help get merchandise off the shelves and make room for the next season’s new apparel.

Each tier will have a certain number of days in which they can make their own double point day.


Reward System

Consumers will receive various benefits that are unique to their shopping habits and tier. The

consumers tier will be evaluated based on the points they accrue. Each tier will have basic

rewards, but consumers will receive unique deals based on items they frequently purchase. Once

consumers hit a certain price point within their tier they can get H&M cash back.

Tiers

In order to encourage consumers to shop more, the loyalty program will consist of four tiers that

will be based on spending habits. Each tier will have unique benefits available to them and will be

associated with a different color. Once the consumer has reached the top tier they will receive a

new card that will directly indicate their H&M status. The consumer’s tier will be re-evaluated

based 6 month periods to determine if they should move tiers. Additionally, once the spending

level has been met, they do not have to maintain this spending habit to remain there.

Tiers Bronze Silver Gold Platinum

Spending Range $100- $200 $201- $400 $401- $700 $701+

Benefits Buy one get one

20% bags

Buy two get one

50% footwear

Buy one get one

50% off

accessories

Triple Points on

Cosmetics

Double Days 0 1 2 4

H&M Cash $10 after $100 $20 after $200 $30 after $400 $50 after $700


Community ForumOpen Forum, Social Media Integration, Photo Competition

In order to engage the target audience we will develop a new page on the H&M website that will

integrate different social media channels. This new page will be called Community Forum and

will be connected with Twitter and Facebook. The creation of this webpage will initially be

promoted on H&M’s social media channels and company blog. There will be two stages for

Community Forum: the first stage will be a photo competition and the second will be an open

forum for consumers to talk about H&M clothing and accessories. In order to create an exclusive

community feel only H&M consumers with online profiles can access the content. This will

provide H&M with a channel that can be used to directly communicate with the target audience.

On the forum, consumers will be encouraged to post photographs of themselves or their friends

wearing H&M clothing and accessories. The idea is to let consumers express their personal style

with the help of H&M. Participants can promote their posts by integrating their social media

accounts with the forum. Additionally, other consumers can vote on outfits they like by liking or

tweeting the images. The participant with the most likes and tweets will win a $500 shopping

spree, along with a post about her experience on the H&M blog, including photographs of the

her new outfits (complete with apparel, accessories, and footwear).

Once the competition has concluded, the webpage will be home for an open forum. The forum

will still be a place for consumers to post photographs of their H&M outfits, but will also become

a place for consumers to ask fashion and style questions. Consumers will have the opportunity to

interact with other H&M shoppers along with H&M employees. Selected H&M employees will

be asked to monitor the forum and respond with fashion advice. These employees will also take

note of participants that are incredibly involved in the forum and have quality content and great

style. These participants will then be offered the opportunity to guest blog on H&M’s blog.

Finally, the Community Forum will be categorized into a photograph section and a conversation

section. The photograph section will then further be broken down into various style categories.


Advertising ScheduleThe campaign will take place over the course of six months. The tactics implemented in this

campaign have the potential to remain permanent fixtures in H&M’s future marketing

campaigns. There will be four stages during the campaign; each tactic will be launched

sequentially.

Timetable

Stage 1: January - February, H&M Loyalty Program

Stage 2: March - April, Community Forum Competition

Stage 3: May - June, Mobile Application

Stage 4: June, Community Forum Competition Concludes - Open Forum Instated


Jan! ! Feb! ! Mar! ! Apr! ! May! ! Jun

Stage 4

Stage 1

Stage 2

Stage 3

Promotion BudgetThis campaign will require a budget of $1 million. The funds will be allotted based on importance

of each component on completing the business and communication objectives.

The most important component of this campaign is the mobile application. The mobile

application seamlessly integrate the rest of the campaign into an entirely new shopping

experience. This will include fees for creating the mobile application, writing QR codes, and

maintaining the mobile applications. Additionally, it will help us reach our objective of increasing

sales in all Women’s apparel categories, along with accessories and footwear.

Moreover, the target audience strongly emphasizes the importance of customer service. In

response, the loyalty program will be the second most important component. The funds will pay

for the loyalty card, and the discount promotions associated with each tier.

Finally, the community forum webpage and online profile components need to be added and

incorporated into the H&M retail website. This requires a web designer to create the page and a

set group of employees to monitor the H&M Experience survey results, as well as, monitor the

content that participants post to survey for direct contact opportunities. This component of the

webpage will aid in increasing H&M’s social presence and add to H&M’s Twitter followers and

Facebook likes.

20%

30%40%

10%Online ProfileMobile ApplicationLoyalty ProgramCommunity Forum


EvaluationIn order to evaluate the success of this campaign, we will use measurement units based on our

business and communication objectives. Our most important metrics are the number of online

profiles and sales percentages. These measurements will be the most accurate way to evaluate the

success of this campaign.

To begin with, we will monitor sales in all of the women’s apparel categories, women’s

accessories, and women’s footwear. If all of the sales have a consistent increase across the various

women’s categories, than the idea of making H&M a one-stop-shop has been a success.

Next, we will gauge our success on social media channels by keeping track of the increase in likes

and new twitter followers. Additionally, we will monitor the traffic on the new Community Forum

webpage and the company blog. We will use unique visitors to measure the unique IP addresses.

This will allow us to better understand how many viewers have visited the website rather than how

many times the website has been visited. Furthermore, we will observe the content that is being

posted on the Community Forum page to determine if consumer participation is optimal.

Most importantly, we will calculate the number of online profiles created. Using the

demographics survey we will analyze how many of these profiles are from within the target

market. Moreover, we will determine the percentage of profiles that were created online or on

the mobile application. We will also evaluate the loyalty program based on number of consumers

that have opted into participating. Not only will we use the number of profiles, but we will also

monitor how many times the average consumers uses their card.

Finally, we will use the H&M Experience survey mid-campaign to gather direct feedback from

the consumer. This will help us analyze our current process and determine if changes need to be

made. If changes are deemed necessary they can immediately be implemented to ensure the

campaign proves successful in completing all of our business and communication objectives.


Appendix

Appendix A-1! 2

Appendix A-2 ! 3

Appendix A-3! 6


Appendix A-1Mobile Shopping Habits

H&M • Integrated Marketing Campaign 28 SN March 12, 2012 supermarketnews.com

RETAIL

DATAPOINTSMore than a third (36%) of smartphone-carrying shoppers said they have used their smartphones to scan a product’s bar code to get additional information while shopping, such as pricing, product reviews and nutritional information, according to a survey of 1,027 shoppers with smartphones conducted last month. The results of the survey, done via Zoomerang and sponsored by Boston-based in-store mobile commerce provider AisleBuyer, showed that smartphone-enabled shoppers are interested most in

mobile coupons — 69% cited that as the most desired retail shopping app. In addition, 76% expressed interest in receiving offers for items they were shopping for, and 74% said they would switch brands as they were putting a product in their shopping cart if they received an offer on their smartphone for a similar product, of similar quality, at a better price.

SOURCE: AisleBuyer’s Mobile Shopping Survey Series

Smartphone Uses at Retail

“Nearly half of shoppers said if a line is too long they will either leave the store without purchasing anything or only buy the few items they came for, without shopping the rest of the store.”

ANDREW PARADISE, CEO, AisleBuyer

76%interested in instant offers via smartphone for things they were already shopping for

interested in scanning products with smartphones to get more info

64%

LINE FATIGUE% who “hate waiting at

line” at these stores

Bring a ListShoppers who bring a list of items to

the supermarket or drug store

POPULAR APPSSought-after features of in-store mobile applications

Abandoning a Purchase

Shoppers who would consider leaving

without buying for these reasons

MOBILE COUPONS

STORE INFORMATION

MOBILE SELF-CHECKOUT

69%

34% 31% 27%

DIGITAL RECEIPTS

Grocery stores 52%

Mass merchants 51%

Drug stores 29%

Quick-service restaurants 27%

Club stores 26%

39%

21%

LONG LINES

NO REGISTERS OPEN

List Specific Brands% of those who bring a list whose list specifies brands

81%

8%

Appendix A-2Survey




Appendix A-3Survey Results




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Strategie de Piata H&M