Business

H&M is launching a radically different store — here's what it might be like

Posted July 04, 2015 11:00 pm

Hayley Fitzpatrick

H&M recently announced it's launching an entirely new brand that's "completely different" from anything it has done before.

The Swedish fast-fashion retailer is known for its affordable abundance of styles.

Karl-Johan Persson, CEO of H&M, told Bloomberg that it will be nothing like the company's sister brands, which include Cheap Monday, COS, & Other Stories, among others.

There are many different directions the fashion powerhouse could take in attacking this new concept.

Here are five directions the company could take:

<h2>1. Go even more fashion-forward</h2>

H&M produces clothing in massive quantities. The retailer creates products inspired by styles trending at the moment, but it is by no means a Zara.

Zara is known for crafting pieces inspired directly from the runway. It often designs and releases new styles in as little as two weeks.

It's more expensive than H&M, and it tends to create its designer-inspired merchandise with cleaner designs. Plus it does it a lot more often and sometimes releases the inspired looks before the designers they're referencing for inspiration are even able to.

Zara has become notorious for ripping off runway designs.

"If I'm lucky and I did the right thing, they will be at Zara way before I can get them in the store and I don't like that," Tom Ford once told WWD in regards to unveiling a new collection.

H&M's focus lies more in offering a wide selection of products at cheap costs, while Zara hones in on incorporating trending aspects of the luxury market in its moderately priced goods.

However, H&M has made strides in the last 10 years to bring its customers coveted designer-inspired styles, which could mean the retailer is leaning in that direction for its new concept.

In 2004, it launched an annual designer-collaboration series, which has been incredibly successful for the retailer. It's created collections with fashion greats like Karl Lagerfeld, Versace, Roberto Cavalli, and Alexander Wang.

H&M could go the high-fashion route and branch into the luxury market with its new brand.

<h2>2. Become even cheaper then it already is</h2>

Customers are often drawn to H&M for its affordability, so the retailer could start selling even cheaper merchandise.

Last year, Forever 21 opened a new store called F21 Red that sold incredibly inexpensive merchandise; since its launch seven more have opened across the US, according to The Desert Sun.

<img class="float_left" src="http://static2.businessinsider.com/image/55954fe9ecad044a3059c9a9-1200-924/f21-red.jpg" border="0" alt="F21 Red">The California-based store sold tank tops for as little as $1.80 and denim for under $10.

The chain is expanding too, with a store opening recently in Georgia and one set to open in Arizona in fall of 2015.

If H&M took this approach it would have to make the brand cheap across all fronts, in order to differentiate it from its current model.

H&M has built its billion-dollar business off of offering customers cheap prices; so furthering that concept could work out for the retailer.

<h2>3. Create the next lifestyle concept</h2>

Although H&M does have a homeware and accessories branch of their business, its heaviest concentration lies mainly in apparel. It wouldn't exactly qualify as a lifestyle brand.

It would be interesting to see H&M implement different product lines like home goods and accessories in its stores.

Urban Outfitters has been transforming itself into a lifestyle brand.

In 2014, Urban opened its largest store in Herald Square in New York City. The store offers a mix of clothing, records, books, and housewares.

The company built a hair salon, coffee bar, and record shop into the location, which not only generated buzz and drew in customers but also transformed the customer experience.

Check out the record shop:

Developing the in-store experience for the customer is becoming a focal point for businesses worldwide, so it's possible that H&M will gravitate towards this approach.

This multifaceted marketing concept would open many windows for the store, in terms of new merchandise and creative aspects of stores.

<h2> 4. Adapt the 'one size fits most' store model</h2>

A large demographic H&M caters to is young teenage girls. With social media's large influence on that generation, teens tend jump onto trending brands and dress like their friends.

One company that capitalized on this is Brandy Melville, a young brand blowing up among teens. One of the main factors that separates Brandy from other fashion houses is its unique sizing.

The retailer stocks a number of inexpensive, nondescript basics, like plain white and black tees and shorts, that mainly fall under "one-size" or small. The retailer does offer select shorts styles in large, but most of its products are designed for a smaller frame.

Although many people criticize Brandy's sizing, there's no denying that it's not stopping people from buying the product. In 2014 it received the top ranking among brands that teen girls say they are starting to wear, according a survey conducted by Piper Jaffray on teen spending.

The retailer's popularity is due largely to its presence on Instagram and other social-media platforms. Brandy Melville enlists focus groups composed of young girls to scout new trends, help design products, and model their clothing.

Article Categories
Business Retail and Shopping