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Case Study: How H&M is changing from global to local… sustainably

Shoppers can recycle clothes at H&M’s UK stores

Shoppers can recycle clothes at H&M’s UK stores

In recent years, H&M has transformed the way it does business. It’s gone from being a one-size-fits-all global giant, to a retailer that still sells around the world, but does so with a more finely tuned local strategy. The fashion to homewares retailer, ranked Leading in RXUK Top500 research, is integrating its online services into its physical stores and is putting customers in charge with a mobile app that helps them connect with online or their local shop – which ever is better for them.

Shoppers can now collect and return their online orders at more and more stores as H&M rolls out this strategy. They can also turn on ‘in-store mode’ to search their local store for the products they want to buy, even from a distance, using text search and visual search. When customers are already in the shop, they can scan clothes tags for more information. They can find out whether sizes and colours are available in the store or online, what the item is made of, how to look after it and how to style it. Customers who sign up to become H&M members can opt for free delivery, collection and access to different ways of paying as the retailer meets shopper demands while, at the same time, getting to know its customers better.

“Our ongoing transformation work to meet customers’ ever-increasing expectations is bearing fruit,” said H&M chief executive Karl Johan Persson in the company’s financial statement for the first nine months of its 2018/19 financial year. He added, “Looking ahead, we remain humble considering the challenges brought by the rapid shift in fashion retail. Our transformation work is therefore continuing at a fast pace in all parts of the company.”

At the same time, H&M is testing new and innovative ideas, with a fresh emphasis on sustainability. Shoppers at its new Stockholm store, for example, can now rent skirts and dresses from its Conscious Exclusive collections. The store is designed to be more inspirational, displaying images shoppers have shared of how they wear H&M products. But it’s also convenient, with payment available through self-service checkouts. In the Netherlands, H&M is testing a bicycle delivery option that’s particularly relevant to that market. In the UK, shoppers can recycle clothes at any H&M store, receiving a £5 voucher in exchange for each bag.

H&M’s strategy is about getting closer and more convenient for its customers. The figures suggest that it seems to be working. Online sales grew by 30% in the first nine months of its 2018/19 year, and overall sales by 12%, while pre-tax profits after one-off costs were 25% ahead, compared to the same time in the previous year.  

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