This report is being prepared in order to get the idea of marketing strategies used by Hennes & Mauritz AB. Marketing includes every activity which is required to maintain the relations with the customers and to turn them into loyal customers. Therefore, this report will provide the brief overview of the customer relationship management concept and its techniques. Along with this, it will analyze the current techniques that Hennes & Mauritz Company is using and its evaluation. Recommendations will be provided in relation to the customer relationship management techniques that can help the company in improving its communication and relation with the customers. Further, the report will explain the concept of promotional mix and the techniques involved in it. Hennes & Mauritz Company’s current promotional mix techniques will be presented in order to evaluate their effectiveness. In the end, the recommendation will be provided in relation to promotional mix techniques in order to help the company in enhancing its market image and promotional strategies.

Hennes & Mauritz AB is a famous multinational company in Sweden which deals in clothing retail business. It is a well-known brand in the country for its fast-fashion clothing for children, women, and men (H&M Group, 2018). H&M along with its associated companies function in 62 countries with approx. 45000 stores. As per the analysis it employed around 132,000 people in 2015. It is world’s second largest retailer of clothes, just after Inditex which is the parent company of Zara and is based in Spain. The company has a major online-presence, offer online shopping options in 33 countries.

H&M group is a design and fashion company with the brands ARKET, Monki, H&M Home and H&M, Weekday Cheap Monday, COS and other stories (H&M Group, 2018). Each brand has its own and unique identity. All the offerings of the company are created by considering their passion towards fashion, quality, and design and the determination to dress consumer in a viable way (Smith, 2016).

The company wants to create fashion sustainable. The employees are focused towards their goals and they are the main reason for company’s success. They are dedicated and want to make better fashion for future.

Product- H&M is considered as the most trusted brand of apparel and acquire a minimum of 2,786 merchandises in its collection. The main products range in this brand contains clothing and accessories such as basic jumpers, fashion shirts, sleeved jersey dresses, undergarments, T-shirts, vests, jewelry, pants, jackets, purses, cardigans, jeans, and shoes (Bhasin, 2017). The focus of the company is majorly on the latest fashion and quality at reasonable prices which is the reason they launch new products on the continuous basis.

Products, Place, Price, and Promotions

Place- The network of H&M is spreading through 55 countries. The head office of the company is in Sweden which takes care of each factor related to the product, from manufacturing to the complete scheduling of merchandise. The products of the company are produced at 800 factories which are established in Europe and Asia. The retail outlets of H&M are very convenient to the customers because they are able to purchase various items from a single place.

Price- The pricing strategy that H&M has adopted has a wider range of pricing which can suit every sphere of merchandiser and buyer. To maintain a median pricing strategy company has kept its lot of products in the section of discount. In this scheme, the sales volume will increase which will result in high revenues (Mstoribori, 2013).

Promotions- H&M Company has always understood the potential of marketing and promotion and henceforth has taken care of its every activity of promotion. The advertisement of the company is focused towards the image of the apparel that is of reasonable price with good quality (Pratap, 2017). The television as an electronic media of promotion has been utilized by the company by sponsoring various trendy and hit shows such as MTV. 

Customer Relationship management refers to a strategy of business which is designed to increase the profit and reduce cost, respond to needs of the company for both potential and current customers to create relationship value (Fader, 2012).

Customer Relationship management is termed as a strategy for a company to manage its communication with its customers. (SCN Education, 2013).

“A business which is totally focused towards offering Excellent Customer Service will just have worry about profit. They will be embarrassingly large”.  – Sir Henry Ford (Small biz CRM, 2018). The business offers various discounts, coupons to their customers in order to increase their customer base but it adversely affects their profit which is a hurdle in the company’s survival in the future.

“The main agenda of a business is to make and maintain a customer” -Peter Drucker. Nowadays every business is more focused towards maintaining their relationships with the customers because it results in repurchase and increases customer loyalty.

The definition of market orientation is the philosophy of a business where the complete focus is on recognizing the needs or wants of the customer and fulfilling them. (Market Business News, 2018).  

The direction used by companies which are marketing oriented and majorly focus on the demands of the customers is known as Market orientation.

Customer Relationship Management

“Business cannot ask customers about their needs and then try to offer that to them. In fact, the time business will build it, the demand of the customer will change”. – Steve Jobs. As per the trend and fashion, the demand of the customer’s changes, therefore, it is very important for a business to identify their demand on correct time by being proactive.

“The best strategy of a business is its satisfied customers” – Michael LeBoeuf (LeBoeuf, 2018). The ultimate aim of every business is to make their customer satisfaction for which they use various strategies such as discounts, loyalty cards, quality, etc. The strategy which helps the company in retaining and satisfying the customers is said to be the best strategy.  

A strategy that places the customer at the center of marketing proposal and delivery is known as Customer centric (Custora U, 2018).

An approach to operate a business that majorly focuses on offering a positive experience to the customer both at the time of sale and after the sale to earn a profit and attain competitive advantage is known as Customer Centric (Harrin and Peplow, 2017).  

“It is possible that there are customers without brands, but on the other side it is a fact that there is not a single brand without customers”. – Anon (Dunn, 2012). Brands are dependent on their consumers and if companies follow this then they will succeed.

“There are various ways that help in serving customers. Information, data, and technology offer helping hand for the company to lead through. The purpose of saving the money of people will always remain important, but business will try to attain this goal by following new ways”. – Doug McMillon (CEO, Walmart). Smart, self-learning automatic customer service, and engagement engines can help in adding to the company’s technology stack, which permits to offer instant, well-organized, day-and-night service to the consumers, without compromising quality.

Customer Relationship Management Techniques	Background of Technique
Creating Loyalty Programs	Gathering information in the software of CRM can provide various levels of commitment by the customers and reflecting the most revenue earning accounts. This data helps in making loyalty programs for valued customers.
Evaluate performances	CRM is used through dashboards to evaluate the implementation of service and identify areas for enhancement.
Targets Consumer with the help of tailor-made offers	The software of CRM gathers the history of customer’s purchase and media consumption in order to plan the type of offers will attract customer and which will help in maintaining the brand’s high-value recognition.
Personalizing the Communications	The software of CRM supports in viewing the customers beyond the revenue rates. The personalization effects have a major impact on the purchase as well as on the post-purchase relationship, where it is correspondingly important to reach to the customers on regular basis in order to increase the service value.
Creating a complete “customer journey” map	Mapping the journey of customer supports in jotting down main facts of the experience of customer: from primary contact, through the engagement process and into a long-lasting relationship (CRM Consulting, 2016).

Each brand possesses its share of customers which are loyal, whose experience forced them to return back on regular basis. The information collected in the software of CRM provides various engagement levels by the consumer which provide the idea of those accounts that are the reason behind the most of the revenue. This confirms a positive relationship with these profitable consumers, making an unforgettable experience for them and also recommendations from the loyal customers in order to extend target reach.

Effectiveness of Technique

Customer Relationship Management Techniques

With the help of this technique, H&M Company creates a list of its profitable consumers. After this, the company invites its customers to join its H&M Club and take the membership. At every purchase, customers get some points which are added to H&M Club and customer uses it to unlock fashionable prizes or rewards modified offers and discounts, and get entree to exclusive events (H&M, 2018). These programs help H&M Company to increase its customer base and revenue. The sales of the company in the UK touched 7 billion SEK which placed the market of UK at the third position among the top ten markets (Statista, 2018).

Ineffectiveness of Technique

As per the above technique, information of the customer is gathered in the CRM software in order to prepare the list of most profitable customers and to offer reward in the form of points. This process consumes a lot of time of the company’s employees as it is not so easy to identify the most profitable customers from the huge list of the regular customers.   

Each consumer has a different pattern of purchase, by which a company can identify the point which is suitable for interacting and engaging with the customer for further loyalty. The software of CRM successfully gathers the complete history of the customer purchase and helps in planning about the type of offer must be provided to the customer that can be appealing and can add relevancy to it (Entrepreneur, 2018).

Effectiveness of Technique

H&M Company has identified various ways to convert the interest of the customer into a definite purchase which is the main agenda of this technique. The company has achieved this by offering various discounts and promotion activities in order to add value to the customer’s experience such as SMS coupons, marketing campaign through mobile in order to promote the fresh collection and trend, mobile banner ads.

H&M Company has followed all the techniques of CRM which resulted in increasing the demand by the customers and company succeed in expanding its business in various locations. The online stores of the company are presently available in 44 markets. The expansion by using online platform will continue in 2018. The future plan of the company is to provide e-commerce on every store (H&M Group, 2018).

Ineffectiveness of the Technique

Offering various discounts, coupons, to the customers has the biggest con that they cost you money. Any form of discount company offers to its clients means less money or profit in its pocket.

• Foster Word of Mouth Discussions- The world is developing so the ways of communication. Besides interacting physically with one other people are spending their most of the time on tablets, computers, or on smartphones. However when it comes to what to buy, where to spend the word of mouth has always been the most effective way to acquire the loyal users.
• Expanding online market sales and coverage- The Company should try to create activities for expanding online sales and coverage.
• Taking care of the customers who are frustrated and their feedback should be used to improve the process of the company.
• Maintaining proper track of the customers will help the company in communicating new schemes and new fashion trends. It also helps in maintaining good relations with the customers by greeting customers on their birthdays through birthday cards.

Creating Loyalty Programs

The promotional mix is defined in the marketing as a mixture of different variables of promotion which are selected by the marketers to support a business in attaining its goals (Lake, 2017). This technique has been recognized as a subdivision of marketing mix. It is assumed that there is an elective way of assigning budgets for the various elements in the promotional mix in order to attain best results of marketing. For the marketers, it is challenging to identify the right mix of them. Actions acknowledged as elements of the promotional mix differ, but normally comprise the following:

Advertising

Advertising is the form of a paid promotion and presentation of service, good or idea by an acknowledged sponsor in a mass medium (Manis, 2014). It is the form of visual or audio form of communication that uses an openly sponsored, non-personal message in order to endorse an idea, service, or product. Advertising sponsors are mostly businesses who are willing to advertise their services or products. It is communicated from different mass media such as Instances comprise brochures, television, in-store displays, mobile apps, motion pictures, emails, web pages, print ads, posters, direct mails, radio, catalogs, banner ads, television, signs, and billboard.

Personal Selling

The procedure of supporting and influencing one or more potential customers to buy a service or good by an oral presentation, face-to-face interaction or by telephonic conversation is known as personal selling. Examples comprise sales training, samples, sales presentations, telemarketing, sales meetings, and incentive programs for intermediary salespeople. Personal selling arises when a representative of the sales meets with a potential client for transacting a sale. Various representatives depend on the process of consecutive sales which normally contains nine steps. This process can be utilized in telemarketing and face-to-face encounters.

Sales Promotion

Sales promotion is a media and non-media marketing communication which is utilized for a limited pre-determined time in order to increase the demand of the customer, improve the availability of the product, and stimulate market demand (Lumen, 2018). Instances include product samples, tie-ins, self-liquidating premiums, exhibitions, coupons, rebates, sweepstakes, trade shows, and contests.

Public Relations

Public relation also known as publicity is an information about the service or product of a firm carried by a third party (Bhasin, 2017). This contains free publicity along with paid efforts to arouse interest and discussion. Examples comprise TVs, speeches, radio presentation, seminars, newspaper issue advertising, magazine articles, and charitable contributions. Specialist of public relation creates and retains relationships with the target audience of an organization, relevant trade media, opinion leaders, and media. The general responsibilities involve writing news releases, designing communication campaigns, writing speeches, arranging interviews for the spokespersons of the company, media interview, writing social media and website content, managing internal communication. The professional of public relation should know how effectively address the issues by using appropriate public relation tool, which is publicity.    

Evaluate performances

Direct Marketing

Direct marketing is a channel-agnostic an advertising form that permits non-profit and businesses to interact directly to the customer, with the help of methods like email, online display ads, mobile messaging, catalog distribution, outdoor advertising, fliers, promotional letters, and interactive consumer websites. Direct marketing removes the involvement of “middleman” form the process of promotion, as a company offers message sprightly to the potential customer. The companies which have less budget of advertising normally make use of this type of marketing as they cannot afford the expensive advertisements.

The messages of direct marketing normally include a call to action, inspiring the receiver to reply through a toll-free number or a reply by clicking on a link of email promotion. Companies can easily measure the direct marketing campaign’s effectiveness by tracking the responses. It is very much effective when the companies use prospect’s targeted list which is developed by utilizing data of marketing.

Promotional Mix	Activities	Examples
Advertising	TV Advertisements	H&M always make an entry in the market with its innovating ads which mainly concentrate on its new innovative designs. Every brand manages its own decisions of marketing. Ads of the company are regularly telecasted on channels which are famous in youth.
Personal Selling	Sales Advisors	They offer suggestive selling to their customers. By one to one basis they deal with the customer that is why the five rules of conduct of H&M are necessary from Hello to customer service.
Sales Promotion	Discounts and Promo Codes	Discounts and Promo Codes are provided at the end of season sale.
Public Relations	Use of Celebrity	The first outlet of H&M in India was opened by Parineeti Chopra.
Direct Marketing	Social media and Search engine Marketing	The company involves extremely in the social media and search engine marketing in order to make the potential buyers a consumer (MBA Skool, 2017).

Evaluation of the promotional mix technique of H&M Company can be done by analyzing its positioning map which reflects that the company has succeeded in promoting its products and placing it on the market (Appendix 1).

The company makes use of innovative TV Advertisements in order to attract the customer but mostly it promotes its products on the channels which are mostly watched by the youth. This depicts that the products of H&M are famous in youth but if we look at the offering of the company they offer products for women, children, and men. Therefore, it can be said that if company advertise its products in most of the channels then it can increase its customer base.

In terms of the personal selling, the company has sales advisers who help customers in buying the products. Besides this company should make sure that their sales representatives are well trained or not because they are the one who interacts face to face with the customers.

Sales Promotion is done by the company by offering discounts and promo codes to the customers at the end of the season it helps them in increasing their customer base. Along with this company can also arrange some type of contests in which the winner of the contest will get the surprise gift of H&M.  

H&M is a very famous company and have a high brand value therefore it makes use of celebrities to promote its latest fashion who are famous in youth. The company can promote its product on radio, magazine, and can contribute some amount to the charitable organization to enhance its image in the society and make good relations with the customers.    

Targets Consumer with the help of tailor-made offers

In direct marketing, it makes use of search engine and social media because it does not involve any middleman and message reaches to the customer directly.

Recommendations for Promotional Mix Strategies

• Increasing the development of eco-friendly production- H&M Company should perform additional activities like imposing limitations on the usage of cotton or can use alternative energy sources for the distribution of its products. In order to promote this initiative, the company can follow AIDA Model i.e. Attention, Interest, Desire, and Action.

AIDA Model
Attention If the company takes the decision of eco-friendly production then they should do proper advertisement to grab the attention of the customer and aware them about company’s offering.	Interest In order to sell the product, the interest of the customer should be increased towards it. For this, a proper description of the product should be provided on the website.
Desire If the interest of the customer is increased now its seller’s work to influence the customer to buy the product. At this position, the advertisement is the best way which creates a desire for the customer to purchase it (Lamb, Hair and McDaniel, 2011).	Action At the time the desire is aroused it must be converted into an action which is the final purchase (Suggett, 2017).

The company should not only promote its products on the channels which are famous in youth but it should also promote it on other channels which can cover all age groups as per the offering of the company.  In order to follow this company should adopt above the line advertising.

Above the line advertising is consist of the advertising which can be reached the wide area, for example, Television, print advertisements, radio, etc. (Jefkin, 2011). ATL communication is done to create the brand and aware the customers about the company’s product. It includes strategies of mass marketing which are majorly untargeted and are only concerned about creating the brand. H&M Company promotes its products on the television but it only covers those channels which are mostly watched by the youth. But as per the offering of the company, it provides apparels for children, women, and men which reflects that company should promote its products on other channels which can increase the awareness and sales of the company’s product.

Conclusion

Employees of a company engaged in marketing department always give their efforts towards grabbing the attention of target market with the help of celebrity endorsements, slogans, general media exposure and packaging design. The above report has reflected the efforts of H&M Company in promoting its services and maintaining good relations with the customers. The company is performing various activities in order to grab the attention of customers and convert every potential customer into the consumer. The report has identified the customer relationship management and promotional mix strategies of the company which has helped it in reaching this position. By considering every step of company this report has provided some recommendations which will support in enhancing its performance in the eyes of the target market.

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