By Aimee Chanthadavong
H&M is capitalising on media coverage as it becomes the latest fashion retailer to launch its online store, as well as announcing its latest designer collaboration with Lanvin, independent retail analyst Verdict suggests.
Charlotte Woods, analyst at Verdict Research told Retailbiz that the collaboration with Lanvin has helped create buzz around the brand.
“They do help to raise the profile of both the luxury and high street brands. For the high street brands, like H&M, it creates a point of differentiation that sets the retailer apart from other similar clothing retailers.”
However, she warns that “collaborations do not necessarily guarantee success”.
“Retailers have to be careful not to reduce the perceived exclusivity of the collections, and as such, should not roll them out too frequently and keep the product assortment fairly lean and innovative, capturing the essence of the luxury brand,” Wood said.
For example, between November 2004 and February 2010, H&M collaborated with a total of nine designers – Karl Lagerfeld, Stella McCartney, Viktor & Rolf, Roberto Cavalli, Marimekko, Comme des Garçons, Matthew Williamson, Jimmy Choo and Sonia Rykiel – but each presented different financial results.
At the same time, Wood speculates that if H&M uses the launch of its online store to its advantage it could raise the retailer’s profitability.
“H&M can use the online site to further market the collection, as opposed to using it as a sales platform, perhaps selling a single limited Lanvin item online, or advertising just a few pieces of the collection to generate interest,” she said.
“Therefore, the online platform will serve to increase brand presence and act as a platform to raise awareness of the collection.”
And the question of whether H&M will ever enter the Australian market – physically as a store or online – still stands.
“I believe that H&M has not yet moved online in Australia as its current strategy involves focusing its online store in markets where the brand already has a strong presence and a large store network,” Wood said.
“H&M has actually no stores in the southern hemisphere at all. The company sites seasonal differences as a key hurdle in entering these new markets. The lack of an existing supply infrastructure in such countries would make it very tricky. At the moment, its suppliers are all in Europe and Asia,
“But having said that, with the likes of Zara and Gap now present in Australia, we may well soon see H&M follow suit. Importantly, this has not been ruled out by the retailer.”
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