Speculation is raging that the Swedish mega brand is gearing up to target its maturing market amid reports of dwindling profits.
Amid reports that Swedish retailer H&M hit a less-than-satisfactory profit margin for the first quarter of 2012, analysts speculate that H&M’s upcoming line of stores in 2013 will cater to the maturing market, as the fast-fashion company’s lines Cheap Monday, COS, Monki, and Weekday have long been identified with younger audiences.
As told to The Financial Times, Adam Cochrane, analyst at UBS, says that the predicted move “will be aimed at an older customer base, as they have a limited offering currently and it should allow for deeper penetration of existing as well as new markets.”
Apart from diversification, the reported strategy may also be seen as a method for the brand to coexist and “mature” alongside its existing customers. Karl-Johan Persson, H&M CEO, shares:
H&M has a long-term perspective, we are investing for the future and we always have the customers in focus. Despite increased purchasing costs, we have continued to strengthen our customer offering – for example, by not raising our prices to customers.
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