By Helen Reid
STOCKHOLM (Reuters) – H&M can’t win on worth alone and should make its garments extra fashionable and of higher-quality within the fiercely aggressive fast-fashion sector, its CEO Daniel Erver advised Reuters.
In his first yr as CEO, Erver has spearheaded investments in advertising and marketing to spice up the H&M model’s enchantment, in addition to a push to hurry up product growth because the retailer tries to regain market share from rivals like Inditex-owned Zara.
H&M should maintain bettering its merchandise when it comes to high quality and trendiness to be able to give prospects worth for cash, Erver mentioned in an interview on Thursday after the Swedish firm’s fourth-quarter gross sales missed expectations.
“Simply competing on lowest worth is not going to minimize it for us, we have to step up and lift the bar,” Erver mentioned.
On-line-only retailer Shein has undercut H&M and Zara with ultra-low costs for attire, tops, denims and equipment, forcing them to search out new methods of differentiating themselves.
H&M will maintain investing in social media influencers and collaborations with pop stars like Charli XCX, Erver mentioned, to succeed in extra fashion-conscious younger girls.
“To start out accelerating the work of gaining market share and … positioning ourselves, it has been actually essential to win the fashion-interested feminine buyer, and particularly the younger era, as a result of she’s going to form the trade for the longer term,” Erver mentioned.
In addition to growing its attain by means of social media, drawing extra prospects by means of its doorways is vital for H&M, which has been reducing its total retailer depend however refurbishing some in key cities.
H&M’s premium Arket model is opening its first shops in Austria, Norway, Greece and Eire this yr. These will embrace cafés, as a part of a push to get buyers to linger for longer.
Whereas not glad with the general efficiency, Erver mentioned H&M’s increased fourth quarter working revenue margin was partly because of a stronger product combine.
H&M’s chief monetary officer, in a separate interview on Thursday, mentioned adjustments it’s making to shorten its provide chain and velocity up its design course of may minimize the time between product thought and arrival in-store by as a lot as 50%.
(Reporting by Helen Reid; Enhancing by Alexander Smith)
