H&M Adrienne Torre
Mission Statement “Fashion and quality at the best price”
Assignment 4 The new product line I will be creating for H&M will actually be a service. H&M already has a store website but consumers are unable to purchase items off of the website making it extremely difficult, actually impossible, for customers who enjoy online shopping to do. My objective is to recreate their online website so that shoppers are
able to purchase twenty-four hours a day, seven days a week. The marketing objective for this service is to reach out to each and every one of the H&M customers plus all of the people that have not had a chance to go into the store and shop. I’d like everyone to see all of the product lines H&M has and be able to make their purchases.
Marketing Objectives
The company I have chosen to do my project on is H&M, and the new service and product line I am creating is to be able to purchase online as well as have to have access to purchase limited goods online. Everything in H&M stores will be online and after typing in your credit card number, the items you have picked will be sent to your home just like any other store that has an online website. Sonia Rykeil is currently designing a diffusion line for H&M and there will be extra pieces not sold in stores that one can find online. This will be great for the shoppers who do not want to rush out to H&M to pick up the latest and see that their size is gone when they can jump on the internet and find something that no one else has for an affordable price.
Product Objectives1. Fashionable clothing the fit the most cutting edge customer we have.
2. Four different garments and/or accessories that a broad range of customers will find of interest. 3. Simple garments to strengthen one’s wardrobe and exclusive pieces to brighten one’s wardrobe. 4. All fabrics used will be organic. 5. These pieces that will only be available to online H&M customers will make them more exclusive.
Sales Objectives1. Competition; there are many stores that have designers create lines for their stores but H&M will create this unique online empire for a limited amount of garments to a limited amount of people to set H&M apart from the rest. 2. Attract; this line by individual designers will attract the most trendy H&M customer that does not want to be seen walking down the street with the same outfit as the person
walking past them. 3. Price; each designer’s line will have a price point that the H&M customer will be able to afford but because it is so exclusive, it will set itself aside from other companies such as Forever21, Zara, Target, and Urban Outfitters.
Marketing Objectives1. These lines will be shown on the H&M website only and will only be available for a limited amount of time with a limited amount of sizes and garments. 2. The target market will be the 18-24 customers of H&M and they will love this because this age generation loves to shop online and have exclusive designer items at an affordable price.
Customer Profile Segmentation Types/Bases Geographic Segmentation Region: North, South, East, and West City Size: 0-100,000+ Population Density: Mostly Urban Climate: Hot, Temperate, and Cold Demographic Segmentation Age: 8months-35
Gender: Male and Female Household size: 1+ Income: $10,000+ Occupation: Blue-collar+ Education: High School+ Sociocultural Segmentation Culture: American, European, South American, etc. Sub Culture: Religion: Baptist, Catholic, Jewish, Mormon, And Protestant National Origin: Italian, French, Canadian, etc. Race: Hispanic, Oriental, African-American, And Caucasian Social Class: Working-class to Upper class Marital Status: Single, Married, Divorced, Widowed Psychographics: Strivers, Strugglers Affective and Cognitive Segmentation Degree of Knowledge: Novice Benefits Sought: Convenience, Economy Attitude: Positive, Neutral, And Negative Behavioral Segmentation
Brand Loyalty: Undivided Loyalty Store Loyalty: Undivided Loyalty Usage Rate: Heavy User Status: Potential Payment Method: Cash, Credit Card Media Usage: Magazines Usage Situation: Work, Home, and Vacation
Stated Corporate Goals H&M describes its mission as “Fashion and quality at the best price”. H&M's goals for 2010 have been to intensify the sales in the existing stores, as well as to increase the number of new stores by 10% to 15% per year. In the year 2009, 193 new stores opened its doors and 16 closed. Expansion and maintaining of financial stability are H&M's strategic goals. In the last 5 years the revenues raised by 73%, including value-added tax and the earnings per share increased by 139%.
External Forces : Opportunities :
Competition: 1. H&M has low prices. 2. H&M has better quality than its competitors. 3. H&M has a fun mood. Economics: 1. People buy lower priced items in bad economy. 2. People purchase from places with a fun environment. 3. Consumers look for the best quality at the lowest price
Nature: 1. Surplus of a cotton crop overseas 2. No inclement weather happening where crop is needed Politics: 1. More people have credit cards and are using them frequently Regulations: 1. Pricing 2. Strong financial position Technology: 1. Online growth 2. Effective communication 3. Market Share leadership Society: 1. Loyal Customers 2. Donating to breast cancer when making a purchase
Threats: Competition: 1. Competitors have layaway 2. Competitors are going green 3. Competitors advertise giving to breast cancer more Economics: 1. People buy less because of the economic climate 2. People are becoming more aware of how price and quality relate
Nature: 1. Products are from overseas 2. Company has not gone green 3. May be inclement weather in future Politics: 1. Credit cards are affecting peoples spending habits 2. People are becoming more money savvy 3. People are spending less on their credit cards Regulations: 1. High tariffs and quotas on items Technology: 1. No ordering off of the internet 2. No application on iphone Society: 1. Have not gone green 2. Only have donated to breast cancer and no other causes
Internal Forces : Opportunities:
Customer Profile A. Demographics a. Wide age range from 8months-35 b. Located in many malls and outlet malls nationwide c. Have clothing for children, teens, and adults both male and female B.Psychographics a. Men and Women have high interest in fashion b. Money buys material things at an acceptable price c. Consumer spends little money on quality fashionable clothing C. Geographic a. Nationwide b. Outdoor Malls c. Indoor Malls D.
Behavioral Buying Traits a. Consumer shops smart b. Consumer looks for good deals on fashionable pieces c. Consumer is able to shop trendy for their children at good prices
Product Mix 1. Children’s Wear 2. Teen Wear 3. Adult Wear
Pricing Strategies 1. Lowest Price Possible 2. Sales frequently 3. Promotions frequently Promotion 1. Breast Cancer Awareness 2. Frequent sales 3. Lots of promotions Distribution 1. Green Transportation 2. More than 90% of transports are done via road, rail, or ocean 3. Airplanes are only used when faster delivery is required Management Structure 1. Annual General Meeting 2. Election Committee, Auditors, Board of Directors 3. Managing Director, Executive management team, Country managers Suppliers 1. All suppliers live up to H&M Code of Conduct 2. All suppliers are audited annually 3. Require knowing all subcontractors that are used to manufacture the clothing
Threats: Customer Profile
1. Demographics a. Too wide of a customer age range b. Catering to too many people c. Children’s clothing same price as adults 2. Psychographics a. Some people do not like the high turnover of the clothing b. Not everyone is ‘high fashion’ c. Some of the designer for H&M wear is very pricey 3. Geographic a. Not located in every state b. Lots in some areas while none in others c. Some have a larger range of items that cannot be found elsewhere or online 4. Behavioral Buying Traits a. Not very good quality b. Not always an option nearby c. Some of the items are very expensive Product Mix 1. Could use a larger men’s section 2. Lingerie for women but none for men 3. Turnover is very frequent Pricing Strategies 1. Lower quality sometimes comes with lower pricing 2. Clothing falls apart so pricing coincides 3. Pricing is accordingly
Promotion: 1. Not going green 2. Do not currently have a holiday promotion 3. Could be doing more for the community promotion wise Distribution 1. Product coming from too many places 2. Mix-ups occur 3. Product arrives at random times Management Structure 1. Too many parts to management 2. Lot’s of people all doing the same things
Marketing Mix Product: All four Sonia Rykeil garments will be off the runway, desirable looks that the H&M consumer will be interested in. All garments will be of great quality and only 1,000 of each style will be sold all online.
Price: Each dress will be $128.00
Promotion: Researched by what will attract consumers and also what way will be best to inform them about Sonia Rykeil’s new online product line.
Coupons: Coupons will be offered in stores for customers to use online which will be ten dollars off their purchase of fifty dollars or more. The coupons will be passed out in the stores and will be accessible on the website as well for a limited time only.
Word of Mouth: All H&M stores will have their sales associates and managers informing customers about the new bedding line and will be wearing uniform clothing from Sonia Rykeil’s new online clothing line.
ADS: Advertisement in fashion magazines such as Seventeen, Lucky, InStyle, Vogue, Teen Vogue, and Harper’s Bazaar will inform and attract H&M consumers into looking or buying the new line on the Internet as well as start purchasing on the Internet. Television ads will be a debatable option.
Press: Certain magazines such as Lucky, Teen Vogue, and In Style will have stories about Sonia’s new line to inform the H&M consumer that they are able to purchase online as well as check out the line.
Place: The customer will only be able to purchase the product online.
Budget The Sonia Rykeil online collection will be expected to make a net profit of ten million dollars in the first year it is launched. The sales budget will be eighty thousand dollars.
Coupons: $10,000
In-store Promotion: $40,000 Magazine Ads: $30,000
Management Organization w/ Officers Names Stephan Perrson, Board Chairman
Mia Brunell Livfors, Board Member Lottie Knutson, Board Member Sussi Kvart, Board Member Bo Lundquist, Board Member Stig Nordfelt, Board Member Melker Schörling, Board Member Marianne Norin-Broman, Board Member Margareta Welinder, Board Member Tina Jäderberg, Board Member Agneta Ramberg, Board Member
Strategic/Secondary Business Units None available.