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‘What is it with you Swedes?’ I ask Jörgen Andersson, the marketing director of H&M. ‘First Ikea democratized interior design; now you’re doing the same thing with fashion. Are you lot on a mission, or something?’ Andersson – who is, as you might expect, tall, good-looking and fairhaired – smiles at the thought. ‘It’s part of our heritage. We’ve been brought up with a Social Democrat government. Since we were young we’ve always been taught that everyone should have an equal choice. It’s not just a business idea, it’s a political one. Ikea was born out of the theory that you don’t have to be rich to appreciate good design. We have the same standpoint on fashion. You can dress from head to toe in Gucci if you like – that proves you’re rich, but it doesn’t prove you have taste. It’s more imaginative to wear your Gucci with some H&M. That’s why Vogue readers are among our most loyal clients.’ H&M’s base at Regeringsgaten 48, Stockholm, is certainly democratic in appearance. Located in the commercial centre of the city, just up the road from an enormous H&M flagship store, it is blocky and practical. The lifts, to be quite honest, could do with a bit of a makeover. Annacarin Björne, the company’s press officer, tells me that this nofrills look is quite deliberate: ‘We pride ourselves in being costconscious, so we can pass those savings on to our customers. We don’t see the point of flashy offices.’
Company founder Erling Persson opened his first store in Västerås, a small town one hour south of Stockholm, in 1947. Persson had been inspired by a trip to the United States, where he had marvelled at a new kind of ready-to-wear boutique offering fashionable garments at affordable prices. He called his concept simply Hennes, or ‘hers’. In the early 1960s, the chain expanded into Norway and Denmark, and in 1968 it acquired the Stockholm store Mauritz Widforss, which specialized in hunting apparel and equipment. Crucially, the fusion allowed the newly created Hennes & Mauritz to add a masculine dimension to its collection. The first UK store opened in 1976.
In 1982, when Erling Persson’s son Stefan took over as chief executive (he is currently chairman), the company entered a period of international expansion that continues to this day. At the time of my visit, H&M had just added Canada and Slovenia to the map, with Hungary and Ireland due to follow at any moment. The brand has been present in the United States since 2000. In total, it has more than 1,000 stores in 20 countries, selling over 600 million items a year. It has an annual turnover of more than 56.5 billion SEK (US$7 billion). Sales outside Sweden account for 90 per cent of this figure, with Germany adding the biggest chunk at 29 per cent. ‘We see the United Kingdom, the United States, France, Germany, Spain and Poland as expansion markets,’ says Björne.
H&M says that it owes its success to three factors: inventive design, the best quality at the best price, and efficient logistics. The team of 100 designers is based in Stockholm – and Björne stresses that, contrary to popular belief, they do not copy styles that have already appeared on the runways of Paris and Milan. ‘They travel all the time and pick up any number of influences, from street trends, exhibitions, movies, magazines and trade fairs. We’re a bit tired of being accused of copying famous designers. If we did that, we’d be up to our neck in court cases – and that’s money we’d rather save.’ The company’s basic products have long lead times – from six to eight months – but it aims to have high-fashion items in stores two to three weeks after the pattern has left the designer’s PC screen. The company’s 21 production offices (10 each in Europe and Asia, another in Africa), with a total of more than 700 employees, are responsible for liaising with around 750 factories. About 60 per cent of these are in Asia, the rest in Europe. H&M does not own any factories, but it has a lengthy code of conduct that all its suppliers must sign, as well as a team of quality controllers who can swoop in unannounced to ensure the rules are being followed (see Chapter 20: Behind the seams). According to Jörgen Andersson, ‘Over the past 10 years, [H&M] have become preoccupied with the question of quality. We expect our suppliers to provide products of the highest possible standard at a very fair price, because that’s our promise to the consumer.’ In terms of logistics, no fewer than 3,200 people are devoted to the task. The completed garments pass through a transit warehouse in Hamburg before being dispatched to distribution centres in individual markets. Only transportation is contracted out; otherwise, H&M conWhen trols every step of the process, acting as importer, wholesaler and retailer. Computerized stock management ensures that new items arrive in stores every day.
This logistics approach is at variance with Zara’s centralized distribution model (see page 51), and there are other points of difference between the Swedish giant and its Spanish rival. One of them is marketing strategy. Unlike Zara, H&M has never shied away from advertising. Its simple but effective posters – showing models in casual poses against plain white backgrounds – have become a familiar part of the urban landscape. And, until recently, its Christmas lingerie campaign, featuring provocative shots of the hottest models, was a festive tradition attracting frank stares of appreciation, mutters of disapproval and free media coverage in equal measure. (A 1993 series of posters featuring the voluptuous Anna Nicole Smith in retro pin-up mode – right in the middle of the skinny-girl ‘heroin chic’ period – is regarded as a landmark in the brand’s development.)
But all that has changed. In accordance with the new era of ‘massclusivity’, H&M is going upmarket. Jörgen Andersson says, ‘What we have done very well throughout the 50 years of our existence is to keep our focus on the customer. We have a lean organization and a constant eye on the market, so, as soon as tastes change, we change with them. We don’t dictate style. Our style is whatever our customers demand.’
What the customers want now, according to Andersson, is glamour:
‘Fashion always mirrors society. Many people today can afford a lifestyle that was previously only available to the rich. With low-cost airlines, they can travel to places their parents only dreamed about. You want to be famous? What’s fame, today? You only have to go on a reality TV show to become famous. Celebrity seems just around the corner, so why not live it out while you’re waiting?’ Enter Karl Lagerfeld. A decade ago, it would have been hard to imagine H&M’s young customers evincing much interest in either Chanel or its courtly, white-haired designer. The launch of Lagerfeld’s collection for H&M was promoted worldwide with giant posters and a two-minute TV commercial, all of which replaced the traditional Christmas lingerie campaign. Andersson says, ‘We had been running the underwear campaign for 10 or 12 years, and we felt that it had lost its relevance. We said to ourselves, “Hold on, we’re supposed to be a contemporary company, a fashion company, we need to do something different.” The underwear posters were very much focused on “this year’s most famous model”. But consumers don’t care about that any more. They have become interested in design. They want to know what the new collection looks like.’
H&M linked up with Lagerfeld through the Paris-based freelance art director Donald Schneider. Andersson recalls, ‘Donald created our new customer magazine and worked with us on our advertising. Through his work for Vogue he got to know Karl, and we had a conversation about whether Karl might be interested in doing something with us. A short time later, Donald called to say that Karl would like to meet us. So we flew to Paris and after sitting and chatting for a while, Karl said, “Let’s do it – when can we get started?”’
Andersson says Lagerfeld was attracted to the ‘youthful and creative’ elements of the H&M brand. Lagerfeld himself confirmed as much in a flurry of interviews. He told French news magazine L’Express, ‘One day I was in the elevator at Chanel with one of the girls who worked there. She looked very pretty in her tweed coat, and I complimented her on it. She told me, “It comes from H&M – I don’t have the money to buy one here!” Obviously, I hadn’t seen the buttons or the lining up close, but it had a lot of style; modern and well-cut.’ (‘Karl Lagerfeld, couturier chez H&M’, 20 September 2004.)

In the same article, Lagerfeld mentions that when H&M sent him a suit for publicity photographs, ‘I didn’t have to make a single alteration.’ He adds, ‘Naturally, the fabric and the finish make a difference, but it’s honest work – certainly more so than the second lines of some designers, [which are] criminal in their condescendence and dullness.’ It doesn’t take a marketing genius to grasp the value of quotes like that to H&M. Partnerships with leading designers have now become an important component of the retailer’s strategy. Not with Lagerfeld, though, who complained to German magazine Stern shortly after the line’s launch that not enough of the clothes had been made available, adding for good measure the suggestion that H&M’s larger sizes did not flatter his designs. The statement did no harm to either party: the Karl Lagerfeld for H&M line remained a rare one-off, collectible for ever more, and Lagerfeld retained his dignity; H&M was the overall winner, in terms of publicity and prestige.
But Andersson observes that a shift in perception is not enough – the upward sweep must be visible at every intersection with the customer. ‘As well as the qualitative aspects of the garments and the production process, we have been working very much with the appearance of stores. We’ve begun to radically rebuild and redecorate. We know that our customers love to shop – they consider it entertainment. And if the store is the main contact with the customers, we have to enhance that experience.’
Aware that its slick new image could create a distancing effect, H&M is building closer links with consumers in other ways. It has tentatively launched a Web-based loyalty scheme, available in Sweden and Denmark at the time of writing. Those who sign up receive the H&M magazine – a cross between a catalogue and a traditional glossy – as well as email bulletins, special offers and discounts. In Andersson’s view, ‘If there’s a group of loyal consumers who love H&M, we should foster that relationship. Mass communication is not always the answer – it’s more efficient to address those who are the most receptive to the message.’ Above all, Andersson believes it is crucially important to keep sight of the brand’s core values, which he lists as ‘fashionable, exciting and accessible’. ‘Traditionally, fashion has been aloof and superior. You look at the advertising; it takes itself very seriously. H&M is not like that at all. I want people to come to the store because they’re going out that night and they need a new top. And they don’t hesitate – they buy something for 10 euros, because, let’s face it, why not? For that price, you can give it to the Salvation Army the next day if you want. It hardly costs more than a couple of glasses of wine.’

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