Marketing Management Report: Arket's Strategic Entry into Singapore

This marketing management report evaluates the market potential of Arket, a sustainable fashion brand under H&M, in Singapore. The report begins with an executive summary and table of contents, followed by an introduction that highlights the growing importance of eco-friendly products in the fashion industry. It then delves into the internal environment through a SWOT analysis, identifying Arket's strengths (H&M brand support, eco-friendly products, diversified portfolio) and weaknesses (new brand, premium pricing, small market). The external environment is examined using PESTLE analysis, considering political, economic, social, technological, legal, and environmental factors in Singapore. The report also includes a competitor analysis, using a perpetual map to compare Arket with competitors like Gucci, Armani, and local brands, concluding that Arket should target the premium segment and offer product variants. The report concludes that Singapore provides a good opportunity for Arket to expand its market presence. Finally, the report references relevant academic sources to support its analysis.

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Marketing management
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Executive summary
The aim of this report is to discuss about the potentiality of Arket in the market of Singapore.
This report discussed the viability of this brand from the perspective of being a eco-friendly
brand. Moreover, the internal and external factors to be faced by them in operating in the market
of Singapore are also being discussed in this report. The report concludes that Singapore will be
a good opportunity for Arket for expanding their market presence. Moreover, the competitor
analysis in this report also concludes that, Arket should cater to the premium segments and they
should have variants of their products.

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Table of Contents
Introduction......................................................................................................................................3
Determination of the internal environment......................................................................................3
SWOT analysis............................................................................................................................3
Determination of the external environment.....................................................................................5
PESTLE analysis.........................................................................................................................5
Competitor analysis.........................................................................................................................8
Perpetual map..............................................................................................................................9
Conclusion.....................................................................................................................................10
Reference.......................................................................................................................................11

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Introduction
Current business scenario is the facing the issue of degradation of environment and
business organizations are facing the challenges in order to overcome this. This is mainly due to
the reason that, environmental degradation is having holistic implications on the entire society.
However, in order to deal with this issue, different business sectors ranging from automobiles to
fashion line, are introducing environment friendly products in the market (Li et al. 2014). These
products are being made with the environment friendly ingredients and will have less impact on
nature. In the recent years, fashion industry is witnessing the rapid growth in introducing
sustainable products in the market by different brands.
Arket is one of the leading fashion brands from the stable of H&M. However, Arket is
the newest brand from H&M in the market being established only in 2017 (ARKET 2018). It is
having diverse product portfolio ranging from fashion products for men, women and children to
the household and home décor products. From the very beginning of their journey, Arket have
maintained the sustainable approach of their brands by selecting suppliers and materials
accordingly.
This report will discuss about the internal and external environments of Arket along with
the threats and opportunities. In addition, competitor analysis will also be done in this report in
order to determine the level of competition for Arket in Singapore.
Determination of the internal environment
SWOT analysis
Strengths  Having the brand support of H&M will help them to push their

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products in the market of Singapore.
 H&M is having good brand reputation in the market along with positive
market presence. Thus, it will be easy for Arket to have their operation
in Singapore.
 Having the eco-friendly products in the portfolio will help them to
positively position the products in the market (Aakko and
Koskennurmi-Sivonen 2013).
 Diversified product portfolio will help them to cover more customer
segments and thus the dependency on single product line is less for
Arket.
Weaknesses  The brand is new and this it will take some time before competing with
the established brands in the market.
 Products of Arket are targeted towards higher end customers. Thus, the
volume of the sales will be less as mass market will not be targeted
(Toften and Hammervoll 2013).
 Singapore is having low population and thus, the market opportunity
for Arket will be low.
 Being a new brand in the market, market penetration is less for them.
Opportunities  Market growth for sustainable fashion products is increasing along with
the increase in the market opportunities.
 The economy of Singapore is enhancing and thus, the purchasing
power for the premium fashion products are also increasing.
 Expanding in more product line or category under same brand will

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further enhance the opportunity (Turker and Altuntas 2014).
 Having online platform for shopping will help them to target and
covers more numbers of customers.
Threats  Sales of the products of Arket may eat up the market share of other
brands of H&M.
 Entry of new players in the market will increase the competition and
reducing the profitability.
 Frequent change in the taste and preference pattern of the customers
will have negative impact on the business of Arket.
 Outsourcing of the entire production process will increase the
dependency of them on the suppliers. Thus, it will increase the risk of
them in their course of business (MoosaviRad, Kara and Hauschild
2014).
Determination of the external environment
PESTLE analysis
Political  Singapore is having positive political environment, which will have
favorable impact on the business operation of Arket.
 However, their franchise in the Singapore will have to adhere to the
political rules and regulations of Singapore. Thus, it will be different
for them to balance the difference between the political regulations of
Singapore with that of their home country, Sweden (Haltiwanger,

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Scarpetta and Schweiger 2014).
 Business regulations in relation to the investment in Singapore will also
be different with that of the Sweden. Thus, it is important for Arket to
adhere to these regulations.
 Moreover, due to the fact that, Arket will operate as a separate brand of
H&M. Thus, they have to enroll themselves as a separate and new
entity in the market of Singapore.
Economical  The GDP growth of Singapore is showing positive trend and thus, it
will be beneficial for Arket to market their products (Tremewan 2016).
 Due to the fact that they outsourced their process of production, the
production cost will be lower, which will further enhance their
profitability.
 However, threats such as economic slowdowns will have negative
impact on their business operation (Morad and Balu 2014). This is due
to the reason that, economic slowdown will reduce the purchasing
power of the customers.
 In addition, the import duties in Singapore will increase the price of
their products due to the reason that, Arket will import their products
from their outsourced vendors.
Social  Fashion portfolio of Arket covers both the genders. Thus, the social
acceptance will be more for them.
 In the recent time, social perception regarding the sustainable products
is positively enhancing. Thus, it will be a favorable opportunity for

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them.
 However, premium pricing will restrict the volume of the sales. Only
the niche portion will get attracted (Bacik, Stefko and Gburova 2014).
 Marinating the effective working environment of their employees
working for their outsourced process will further enhance the
opportunity.
Technological  Arket should always update themselves in latest technologies in order
to stay ahead in the competition.
 They should initiate the use of latest technologies in the production
process in order to have better quality products (Felkar, Jomo and
Rasiah 2013).
 Technologies should also be initiated in the field of marketing and
sales. This will help to target the customers effectively.
 However, huge cost and infrastructure are important for the
technological advancement. Thus, it will have extra cost burden on
Arket.
Legal  Singapore is having various laws related to employee’s welfare. Thus,
it is important for Arket to adhere to these regulations for their business
operation.
 They have to maintain standard and effective salary structure and
working condition for their employees in order to prevent the
emergence of issues.
 Financial audit is important to be maintained due to the reason that

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Higher price
Gucci
legal regulations of Singapore made it mandatory for the business
organizations.
 It is important for them to identify the conflict areas between their
organizational policies and national laws of Singapore.
Environmental  As earlier discussed, Arket promotes sustainable development. Thus, it
will be easy for them to adhere to the regulations and standard related
to environment.
 It is important for them to promote sustainable business approach in
their entire business operation rather than just on one area. This will
includes recycling of packaging materials and reducing the carbon
footprint.
 Waste management should be taking care of by them in order to reduce
the impact of their generated waste on the environment.
Competitor analysis
The above sections have discussed about the internal and external factors for Arket.
However, apart from these factors, it is also important to determine the competition in the market
where Arket is going to operate. The current scenario of fashion industry in Singapore is
intensely competitive with the presence of good number of established players. Thus, it will be
difficult for Arket to gain market share in the Singaporean market.
Perpetual map

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