Clothing brands are offer consumers various trendy outfits so that they can be satisfied with the latest trends operating in the markets. The clothing brands offer various innovative fashion statements to its consumers. One such Swedish fashion brand is H and M where it stands Hennes and Mauritz. The clothing brand came into existence in 1947 since then it is satisfying the fashion needs of its target segment. Erling Persson was the founder of the company who made the company to reach to the great heights which has now net income of US $2, 106 Billion. The great reputation of the company which is due to its greatest competitive advantage which is providing the high quality of products to the consumers helped it in reaching the most of the nation’s globally. According to Forbes 2015, Among the fortune 100 companies, the company was termed as the most valued companies. In the past decade, the company has taken various steps to amend its human resource policies thus helping in achieving the big goals in the organization (Halme, 2013). The following essay will be discussing about the various functional areas that are human resource management and marketing communication. It will also be discussing about the various factors using porter is five model of H and M.
Porter’s five Forces model:New Entrants threats
The threats of the H and M for new entrants is low. There are various reasons for the low threat of new entrants of the H and M.
Difficulty for the other competitors to imitate –
The H and M has various competitors that include Zara and Mango. Apart from the big competitors, there various other small competitors (Hauge, 2019). The competitors are unable to secure the market place of the brand H&M due to the high level of differentiation in its clothing products. the products manufactured by the company are of different styles and patterns thus luring the consumers towards it.
Brand loyalty-
The H &M brand enjoys the high brand loyalty with its consumers as they are able to satisfy the needs of its consumers in a holistic manner (Lee, 2016).
Capital requirements-
The capital requirements for the H and M company is very low as it is a clothing brand and with the minimum capital requirements the quality of the fabrics could be produced.
Economies of scale-
The clothing products manufactured by the company are in bulk with the low of cost of production thus helping them to secure the strong market base of its consumers. The company is able to meet the market demand of its clothing products efficiently with high quality and low cost of production (Nagurney, 2015).
The company enjoys the low bargaining power of the suppliers where the suppliers are less likely to bargain for the products. The reasons for the less bargaining power of the consumers are.
Importing raw materials from other countries-
The H&M which is a clothing brand imports the raw materials for its products from the other countries that include USA, UK, and from Asian countries. The company rarely uses the raw materials of it home countries. The reason of import from the other countries provide it an advantage of low bargaining power of the suppliers (Hermanson, 2018).
Customers less concern for the origin of the fabrics-
The target customer segment of the H&M clothing brand does care about the origin of the customer fabrics. They are less concerned about the its origin.
Low reputation of the industry suppliers
Suppliers in the clothing industry enjoy less reputation of the projects because of it most of the companies in the industry give less preferences to the industry suppliers (Huang, 2016).
The company enjoys lower substitution threats in the industry. some of the reasons for the company to enjoy lower substitution threats are-
No substitution for the products-
The clothes for the H&M brand are unique in their quality and patterns which leads to no substitution of its products. Moreover, the clothes are highly differentiated in the way, they are stitched and woven into beautiful patterns.
All types of the clothes-
The brand offers all types of clothes that include luxuries and non-luxuries clothes. The clothes are available of all the qualities that give the company the advantage to cater to the needs of the many categories of the consumers that include luxuries and non- luxuries.
The H &M company enjoys moderate bargaining power of the buyers. there are various reasons for the company to enjoy the moderate bargaining power of the consumers.
High variety of the clothes
The company delivers the high variety of the products. The brand offers various variety of the products thus the buyers get the position to negotiate on many grounds (Hauge, 2019).
Difficulty in retaining consumers
It becomes difficult for the company to retain the consumers as various steps are to be taken to retain them. The reason in the difficulty of retaining the consumers is changing fashion trends of the consumers.
Consumers have various brand options
Consumers have various brand options to satisfy their fashion needs. Most of the brands offer to its consumers the good quality of the products at low price. The other important brands are Zara, Mango, and other small outlets to buy from (Stål, 2017).
Indirect bargaining power of consumers
Although consumers do not bargain the products of the brand directly with the branding expert but they usually follow the indirect patterns to bargain the brands. the indirect ways of the bargaining include simply switching on to other brands of interest or stop buying the brands if they do not find it any interest in it.
There is high level of intense rivalry in the industry. The reasons for high level of intense rivalry are-
Innovative designs of the products-
The designs of the products are innovative in nature. Many companies keep evolving with the designs according to the changing fashion needs and requirements for the company. The evolving designs of the company helps in the innovation of the company thus leading to the various creativity in process.
Highly volatile trends of fashion-
The fashion trends are dynamic in nature and are highly volatile in nature. The fashion trends are helpful in improving the nature of the organization. The highly volatile nature of the organization is helpful in management of the merchandise in the best possible manner.
Excess cost of inventory
There is excess cost of inventory involved in storing the goods in the warehouse thus leading to increased cost of inventory for the business. There is various inventory cost in the company that helps in the better management of the brand name of the company.
Advertising cost
The advertising cost of the company is high thus results in the lower profitability of the projects. The higher advertising products results in the lower profitability of in the business thus affecting the overall position of the business.
The H and M is known for its highly differentiated and top-quality products. The high- and top-quality products are helpful in enticing the consumers towards the brand
The management of the human resource is important for the high productivity and the profitability in the business. The H&M company has the best management of the things and are helpful in achieving the goals in the organization (Capone, 2016). The company has various human resource strategies that make it productive in the organization. Some of the strategies that are helpful in achieving the various goals that the company is following includes increased motivation in the organization, and ensuring the discipline in the organization. The company takes care of the motivation of the employees in the organization, the activities include recreational activities, higher level of incentives and increase in the salary. Some of the recreational activities include various recreational meetings, café outings, health programs, and wellness programs. The health programs are helpful in taking care of the mental or physical health of the employees (Fontana, 2018). The right wellness and health programs are helpful in creating the healthy space in the mind and physical body of the employees because of it they become productive in the organization. The social events such as café outings and recreational meeting at beautiful locations are helpful in maintaining the good relations with the employees. These good social gatherings are helpful in maintain the good relations among the various levels of the employees thus helpful in achieving the goals in the organization (Gadde, 2019). The Hand M company also organizes various programs that include workshops, and trainings for its employees. The workshops and the training include sessions based on teaching the skills and successful strategies that are helpful for the employees to achieve their strategies. The good human resource management offers the company with the good competitive advantage to achieve the results.
Marketing communication is important in communicating the target market about the products and services. The Hand M has the best the communication strategies for the marketing it clothes. It uses various mixtures of the marketing communication that include print advertisements, blogs, and articles, organizing various campaigns, and incentives programs. The print advertisements are helpful in catching the attention of the high strata of the society (Beheshti, 2017). The companies are also active on the social media where it has its own business page which is well reached by various target segments. The company also make its personal blog writers to write attractive and luring blogs. Those blogs are helpful attracting new consumers thus helpful in gaining the new market share. The articles are helpful in achieving the goals in the organization thus leading to better attention to its clients.
The company has organized various successful marketing campaigns. Some of the marketing campaigns include the perfect 10, and go green wear blue. The perfect 10 campaigns of the organization are about communicating the consumers regarding different ten looks of an individual wearing the dresses of the H and M brand. The other important marketing campaigns of the company include go green wear blue where the consumers have communicated that the product quality of the products are sustainable by mentioning the phrase of “go green”. The company also communicated about that it manufactures the product using the green technology. The other phrase of the tag that is “wear blue” that suggest that the company offers the cool the type clothing to the consumers. Beside the campaigns for the marketing communication to communicate regarding the characteristics of the products, the company has also organized the various campaigns related to the social activities of the business thus improving its image in the long run.
The following graph reflects the growth and slump in the conscious and H&M + collection of the brand.
In the past years the H&M positioning strategies of the conscious collection has declined. The decline was due to the ineffective marketing communication of the brand. The decline was reflected in the H&M + collection.
The H&M can succeed in the sector by increasingly focusing on its strategies to achieve the marketing communication so that the communication can be achieved by effectively communicating about its goals to the consumers and doing the good market survey so that the goals can be achieved in the organization.
Conclusion
The competitive advantage of the company makes it one of the best in the industry. The competitive advantage of the company is achieved by the good operations in the functional areas of the business. The performance of the employees in the organization has impacted the quality of its projects and good marketing communication of the products were helpful in achieving the goals of the organization. The H and M has achieved the good positioning in the market by following the strategies effectively and efficiently to achieve the results.
References
Beheshti, H., 2017. The benefits of e-business adoption: an empirical study of Swedish SMEs. Service business, 3(1), pp. .233-245..
Capone, F., 2016. Fashion and city branding: An analysis of the perception of Florence as a fashion city. Journal of global fashion marketing, 7(3), pp. 166-180..
Fontana, E., 2018. Corporate social responsibility as stakeholder engagement: firm–NGO collaboration in Sweden. Corporate Social Responsibility and Environmental Management, 25(4), pp. 327-338..
Gadde, L., 2019. . Future changes in sourcing patterns: 2025 outlook for the Swedish textile industry.. Journal of Purchasing and Supply Management,, 25(3), pp. 115-225.
Halme, M., 2013. The influence of corporate governance, industry and country factors on environmental reporting.. Scandinavian journal of Management,, 13(2), pp. .137-157..
Hauge, A. M. A., 2019. . The spaces and places of Swedish fashion.. European Planning Studies,, 17(4), pp. 529-547..
Hermanson, I. M. M., 2018. . The evolution and embeddedness of knowledge-intensive entrepreneurial firms in creative industries: contrasting experienced and non-experienced entrepreneurs in the Swedish fashion industry. European Planning Studies, , 26(12), pp. 2387-2406..
Huang, K. H. T. W. J. C. K., 2016. From fashion product industries to fashion: upgrading trends in traditional industry in Taiwan. European Planning Studies, 24(4), pp. 762-787..
Lee, K. H. D., 2016. . Small and medium enterprises and corporate social responsibility practice: A Swedish perspective. Corporate Social Responsibility and Environmental Management, 23(2), pp. 88-99..
Nagurney, A. Y. M., 2015. . Fashion supply chain network competition with ecolabeling. Sustainable Fashion Supply Chain Management, 55(2), pp. 61-84.
Stål, H., 2017. Sustainable consumption and value propositions: Exploring product–service system practices among Swedish fashion firms.. Sustainable Development,, 25(6), pp. 546-558..
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