Uniqlo vs H&M Case Study- Growth Strategies

Uniqlo and H&M are top international clothing brands that own over 2000 stores globally. These competitive companies cater to similar markets but have different strategies they use to manage their product distribution. When considering Uniqlo vs H&M as a case study, there’s a need to look into their approaches for ownership of materials, manufacturing process, and how they treat other brands. To help you gain perspective on Uniqlo vs H&M, read this article as we take an in-depth look into the brand, its focus, and its growth strategies.

H&M Brand

H&M or Hennes & Mauritz is older than Uniqlo. This brand was founded in 1947 and in Sweden. It is one of the top recognized brands in the fashion industry, primarily because of its affordable prices. When mentioning top branded fashion stores, it’s hard not to note H&M. It is a fast-fashion clothing brand that caters to women, children, men, and even teenagers. It is the second-largest clothing retailer, second only to Zara. The company runs online and offline in more than 30 countries. The brand has over 5000 stores where it caters to its extensive customer line. 

Erling Persson established the brand in 1947 for women. However, the brand has grown considerably since then. However, the company has built subsidiary brands like ARKET, Monki, COS, Weekday, etc. When Erling acquired the brand, its focus was on hunting apparel called Mauritz Widforss. However, Erling changed the brand’s name to H&M to reflect the fashion brand’s strategy, and it began to include menswear in its clothing brand. Hennes and Mauritz’s name was hard for some people to pronounce and remember; this shortened the name to H&M. 

H&M Growth Strategies

H&M has grown into a big brand over the years, and it is due to some growth strategies. Below are some of the strategies that make them different in the Uniqlo vs H&M case study.

Product Strategy

This company is famous for taking on the fast-fashion branding strategy. This means they consistently provide customers with top-quality clothes and accessories in record time. These fashion pieces are always admired and are consistent with fashion trends. H&M is always prepared to release new lines of products. They sell European-fashioned clothes to the American market. This strategy helps to bring in inter-cultural fashion.

The product strategy of H&M is to provide top-quality clothes based on the trends in fashion but at the best price possible. This company has four product stages: the introduction, growth, maturity, and decline stage. The product manager reviews product demand and supply and then uses these product stages to provide an effective marketing strategy for the new product. This strategy helps bring the new product to compete in the fashion market. 

Price Strategy

Another growth strategy that differentiates H&M in the Uniqlo vs H&M strategy is their price strategy. Some buyers would insist that some clothes by H&M cost a lot to acquire because they provide high-quality fashion. This brand helps to provide top quality at a low price by controlling transport and labor cost. 

Promotion Strategy

H&M also uses a promotion strategy to thrive in the fashion industry. Its promotion strategy includes a multi-channel approach, including sales promotion, advertising, and internet promotion. This variety of brand advertising helps to expose them to a worldwide audience. Another way the brand attracts customers and builds brand awareness is by displaying low prices while carrying out marketing.

Place Strategy

H&M has successfully created a dependable bond between their customers and themselves. They achieve this by ensuring the company has different outlets in various geographical locations worldwide. With over 5000 stores available in more than 70 countries, H&M successfully connects with their customers. Their essential goods production takes place in Asia. However, the creation of high-branded goods is in Turkey.

Cost Leadership Strategy

When you consider the H&M portfolio, the brand always has new products that increase your desire for them. Luckily, most of their clothing is available at affordable prices. However, the price is determined by the market price of any of the niches. This cost leadership strategy is focused on working efficiently to expand the brand market share. Instead of setting a high price and earning a huge profit margin, H&M focuses on expansion. Their primary focus is fashion and quality, and they always provide these at an affordable price. To provide clients with the best, H&M also collaborates with top brands to provide their audience with fresh style.

Segmentation Strategy

With their inter-cultural strategy and broad expansion of stores, the brand has reached cultures and lifestyles worldwide. The brand segregates its products into classes. You can find extravagant products for high society. However, there are also low-cost price products for the middle class. The brand also covers age segmentation. It encompasses all genders and caters to people from zero to forty years but is most popular with people between the ages of fifteen to thirty years. H&M presents people with fashionable products and accessories ideal for your age grade.

Uniqlo Branding Strategy

Uniqlo is also one of the top fashion brands in the industry. It was initially founded in Japan back in 1949, but Fast Retailing Co. purchased it in 2005. It is one of the largest fashion brands today, although its success sprouts from unconventional methods. This Japanese brand cares very little about fashion trends. Instead, it focuses on its high-tech fabrications to win consumers over. The brand expanded into markets across North America, Europe, and Asia over the years. This action elevated the brand making it one of the global fashion brands and a strong contender in the mass market.

The Uniqlo marketing strategy is what makes it unique in the Uniqlo vs H&M case study. This brand isn’t into fast fashion and doesn’t provide new styles in an ultra-fast production cycle. This brand focuses on offering its audience timelessness. Its design philosophy is life wear, and it has stuck to this over the years. 

Uniqlo Brand Strategy

The brand message shows the clear vision of Uniqlo, which is to inspire the world to dress casually. This strategy has proven successful for them over the years as they continue to ignore fashion trends. Rather than chase fast fashion like their competitors, they create timeless products for their customers. Their outfits are made for all because they cover all ethnicity, gender, and other defining factors. The name Uniqlo makes it look like their products are rare products. This brand’s clothing is usually simple and universal outfits. They allow the wearer to blend into their unique lifestyle seamlessly. 

The brand offers exceptional performance because they produce their fabric in-house and possess high design innovations. They also distinguish themselves in the Uniqlo vs H&M case study by branding with signature names like LifeWear, Airism, HeatTech, and many more. To better understand the brand, you should get an in-depth look into their success factors, and you can find these below.

Delivery System Supporting the Brand’s Promise

One challenge most brands face is defining a clear promise and then delivering on it. Today, many successful brands create supportive operational structures that help implement strategies to deliver the brand promise. One such brand is Uniqlo, and they achieve this effortlessly. Over the years, they have successfully defined a clear brand promise for their target audience. They promise universal, top-quality, highly performing, basic casual outfits. All these are affordable as the company uses an effective delivery system to make this promise true.

Product Development and Supply Chain Approach

Many people attest that Uniqlo is more than a fashion company and is also a technology company. Although H&M, one of the brand’s competitors, achieves its status by producing clothing pieces based on fast-changing fashion trends, Uniqlo does not. The brand’s approach to creating clothing pieces is similar to the process used in the technology industry. H&M serves customers by moving items from the factory to the store in less than two weeks.

Uniqlo is quite different in its approach. The brand plans out production of the wardrobe essentials a year before production takes place. Unlike their competitors, who sell a vast array of trendy fashion pieces, they focus on just a few styles. Uniqlo runs an effective supply chain. The marketing department is entirely in charge of creating a strategy every year. This strategy is supposed to align with demand. The skilled staff members also visit production centers at the end of production to ensure the products meet quality standards. This opportunity helps them resolve outstanding issues before releasing the products to the public. 

Company’s Culture

Another factor contributing to Uniqlo’s success in the Uniqlo vs H&M case study is the company’s culture. The CEO has received a high ranking from Harvard Business Review in 2019 due to its visionary leadership. He is known and hugely credited for the explosive growth of Uniqlo over the decades. The market capitalization of the brand has increased by 39 billion dollars since 2000. He owes this to the company’s culture, which focuses on teamwork and excellent customer experience.

Teamwork is made apparent in their organizational structure, where they are allowed to provide suggestions. The financials of the company are also quite transparent to the employees. Sales are charted and posted for employees to view. Additionally, the company effectively manages every touchpoint with the customer. Staff training for three months takes place to prepare every new employee in the company. Every activity employees are involved in is taken note of, from how they return credit cards, to eye contact, to how they fold clothes.

Dedication to Innovation

Another reason Uniqlo is so successful is its dedication to innovation. This brand fully understands the importance of innovation to a company’s success. That’s why they’re famous for their creative fabrics. HeatTech is one such fabric that turns moisture into heat. This fabric creates air pockets so that it can retain the heat. It is very thin, comfortable, and popular in many of the brand’s stylish clothing. Other fabrics are LifeWear and AIRism, and they’re both just as innovative as HeatTech. With branded fabrics, competitors cannot attempt to match them. All the planning, design, and manufacturing takes place in-house. 

Uniqlo Sustainability Approach

Sustainability is one of the hottest topics on the internet and is becoming a crucial hygiene factor for most companies. One of Uniqlo CEO’s principles is giving back to society. He believes the value of the company depends on the value it offers the community. Therefore, the company ensures that it is concerned with the environment, animal welfare, and cotton farmers when procuring raw material. They also ensure they respect human rights in their supply chain. Therefore they safeguard their working conditions in their environment.

Additionally, the company eliminates waste in its operation chain to help preserve the environment. It is continually reducing water use and gas emission in its stores. The company also supports customer fulfillment and strengthens communities where the stores exist.

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Conclusion

H&M is one of the top brands for many reasons. This brand has grown over the decades and competes with Zara as one of the leading fashion brands. Although its primary strategy is the fast fashion business model, this company utilizes several other growth strategies. This brand appeals to the mass market due to its affordability to different classes. Uniqlo is another top fashion brand that has stayed true to its philosophy of simplicity. Its main difference in the Uniqlo vs H&M case study is the growth strategies outlined in the article above. Additionally, unlike H&M that outsources cloth manufacturing for cheap labor, Uniqlo does it all in-house. These two fashion brands have a top spot in the fashion industry and thrive due to their innovative growth strategies.

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Uniqlo vs H&M Case Study- Growth Strategies When people talk of top fashion brands, Uniqlo and H&M pop up. Find out how these two brands grew in this Uniqlo vs H&M case study.
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