Through today's closing, CEO Daniel Ervér can summarize his first year as CEO of H&M. The company's profit before tax for the fourth quarter was indeed better than expected, but one problem remains – sales. An increase of 3 percent in local currency was worse than expected and signals that the company has continued challenges.
We are not satisfied with that, but we see that there is potential, says Ervér to TT.
And that's where the female customer comes into the picture. H&M never reports sales separately for different target groups, but notes that it is on the women's side and not among men's or children's clothing that they grow the most. Therefore, they now choose to focus on this target group.
We know that the female customer has a great impact on how the whole family shops and how we are perceived as a brand. Therefore, we have directed most resources to the women's side. We will continue to accelerate, the customer has so many options today that we must be super relevant and create a lot of news value, says Ervér.
Tough competition
At the same time, the competition within that sector is also the toughest?
Yes, but it's a "must-win" for us. It's our most important customer. When we win her, we can also win her as a mom, partner, or however she shops for home decor or when she's going to work out.
The strategy has been seen in, among other things, H&M's autumn collection, where the clothing company used British singer Charli XCX. To reach a younger, trend-sensitive target group, they also need to reach out more and more through social media and among influencers, notes Ervér.
Just that has, for example, the Chinese fast fashion company Shein made a clear business strategy.
Important channels
According to Ervér, it is then primarily Instagram and Tiktok that are the absolute largest channels for the company.
On Tiktok, you currently have 500,000 followers. Your competitor Zara has over 14 million?
It's about choosing and focusing on the influencer market. We haven't done that before in the same way, only now during the fourth quarter. If you look at our growth in followers, it's fast.
Tiktok is, however, politically sensitive, among other things in the USA. How do you handle that?
We have to adapt like the rest of the industry, that things swing quickly with geopolitical changes and that we can move just as quickly.
