H&M New Trend Of China's Market Development: Penetrating Into Market Segments

International fast fashion giant with 149 stores in China H&M It seems that it is not satisfied with the existing expansion mode, and it is becoming a new direction of its development in China.

In the past, H&M showed to Chinese consumers only the comprehensive store mode, women's wear, men's wear, children's wear, shoes Classes and accessories are sold in the same store, but from now on, this pattern has changed. Last year, H&M launched its COS brand franchise store, high-end &Other stories and its sub brand Monki in China. Recently, H&M also opened a separate children's wear shop and China's first men's wear shop to accelerate its entry into the market segments.

Yesterday, H&M China headquarters related personage told reporters: "at present, this is just an attempt, whether it will open more shops in the future, depends on the effect of this mode and the planning of headquarters."

"As a self created brand, H&M has the ability to extend to the subdivision store." Cui Hongbo, founder of brand management in Shanghai, told reporters that this strategic trend is more noteworthy. The Chinese market has been planned by H&M as the most competitive market.

In addition to changes in the mode of shop opening, in the market choice, H&M is obviously not satisfied with taking root and blossom in the first tier cities, instead, it puts greater hopes on the two or three line cities. According to the data provided by H&M to reporters, as of August 1st this year, the number of stores in the two or three tier cities except Hongkong and North Guangzhou Shenzhen has accounted for 63.76% of the total number of stores in China.

Although the consumption power of China's retail market has been weakening, H&M's pace of opening up this year is still undiminished, the total number will exceed 45 last year.

Why do other fast fashion brands gradually slow down the pace of horse racing, while the H&M's expansion in China remains undiminished?

One industry insider said that this is closely related to the preferential policies of two or three cities, especially shopping centers, which give these fast fashion leading brands, such as rent free, low rent, some subsidies, etc., so that H&M can occupy the channel through a lower threshold, and this advantage is more obvious in small and medium-sized cities.

Of course, it may also be a way for H&M to cope with the global decline in overall performance. H&M group's latest performance report shows that between December 1, 2012 and May 31, 2013, net profit of H&M group decreased by 11.9% compared to the same period, while same store sales decreased by 4%.

However, H&M has always been inferior to rival ZARA in terms of scale and performance. ZARA brand owner Inditex successfully replaced H&M in 2006 to become the largest in Europe. clothing Vendors, and sales growth over the past three years has also surpassed H&M. At present, ZARA has 406 stores in the Chinese market, while H&M has only 149.

Just this month, H&M officially launched an online sales platform in the United States. This delay in the implementation of e-commerce has also made H&M lose many opportunities in the online retail market, far behind ZARA.