Marketing Plan: H&M Canada Summer Clothing Communication Strategy

This marketing plan focuses on developing a comprehensive marketing communication strategy for H&M in Canada, specifically targeting the summer clothing segment. The report begins with a detailed situational analysis, including PESTLE, competitor, and consumer analyses, to understand the market dynamics and identify opportunities and threats. The plan then defines specific marketing objectives and outlines strategies for target segmentation, perceptual mapping, and positioning. Furthermore, the report provides recommendations for effective communication strategies and supporting positioning efforts. Throughout the analysis, relevant marketing theories and models are applied to support the proposed action plan, aiming to increase profitability and ensure sustainable operations for H&M in the Canadian market.

Marketing communication plan for H&M in Canada
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Table of Contents
1.0 Introduction....................................................................................................................................3
2.1 PESTLE Analysis..............................................................................................................................4
2.2 Competitor Analysis........................................................................................................................6
2.3 Consumer’s analysis........................................................................................................................8
2.4 Internal context with VRIO Analysis................................................................................................9
3.1 Objectives.....................................................................................................................................10
4.0 Strategies.....................................................................................................................................11
4.1 Target Segment.........................................................................................................................................11
4.2 Perceptual map.........................................................................................................................................14
4.3 Positioning Strategy..................................................................................................................................15
5.0 Recommendation..........................................................................................................................15
5.1 Strategies of communication....................................................................................................................15
5.2 Strategies for supporting positioning........................................................................................................16
Conclusion..........................................................................................................................................17
References..........................................................................................................................................18
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1.0 Introduction
This research work will focus on developing a marketing plan for H&M in Canada. It will
primarily focus on the summer clothing as the organization has a detailed assortment of the
same. The key focus will be to increase the profit in this category and ensure that the
organization operates in a sustainable manner.
Hennes & Mauritz (H&M) is a Swedish multinational clothing company that was founded in
1974. Fashion in fast fashion for women, men, children and teens is what the company is well
known for (H&M Group, 2022). In 2020, H&M Canada's revenue is estimated to be $65.18
million Canadian dollars, with an overall operating profit of $1.78 billion USD. The revenue for
H&M has grown by 36.5% in five years, from $480.34 million CAD in 2014 to $756 million CAD
in 2019 (Statista, 2022). The H&M store count in Canada was 96 as of 30 Nov 2020 (H&M
Group, 2020).
The present population of Canada is 38,321,435. People from different religious beliefs such as
Catholic, Protestants, Hindu, Muslims, Sikhs, and many more live in Canada (Worldometer,
2020). The organization will target people from all religions. With the help of a direct distribution
channel, it is possible to reach out to the target segment through retail outlets and online
means. Consumers have a habit of trying fashion products from renowned brands and this will
be considered an opportunity.
This research work will conduct a detailed situational analysis of the company, identify the
marketing objective and then provide relevant recommendations to ensure that the company is
able to attain its objective. Relevant theories and models would be used throughout the
research work to support the action plan.
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2014 2015 2016 2017 2018 2019 2020
1.70%
1.90%
2.20% 2.30% 2.30% 2.40%
2.70%
H&M apparel market share of Canada
from 2014 to 2020
H&M apparel market share of Canada
(Smith,2022) https://www.statista.com/statistics/964478/handm-market-share-apparel-industry-
canada/
2.1 PESTLE Analysis
Influence Factors Impact Significance Time Communications Implications
O or T H/M Now/LT
Political/Legal
The Canadian government
has formulated rules and
regulations to be followed
at the time of formation of
a company, employee
hiring, employee welfare,
fair competition, consumer
protection etc.
(Opportunity)
H&M has followed the same
and hence it can operate
easily.
High Now
With the help of regular
communication, it is possible to
follow the laws appropriately
Economic
Covid -19 has adversely
affected economy in the
last two years which
directly affected the
consumer purchasing
power and per capita
income.
(Threat)
The consumers may not
purchase products from
H&M if their income gets
affected.
High Now
Keeping a regular watch on the
economic factors can assist in
undertaking the right
strategies.
4

Sociocultural
Difficult to attract the
customers and retain them
with the brand as
customer do not have
brand loyalty for clothing
since the clothing trend
change rapidly so
customer buy the brand
that keep up with the
trend.
(Threat)
Need to spend a lot on
marketing to be in customer
mind due to no brand loyalty High
Long-term Regular communication with
the customers can ensure their
loyalty.
Technological
Modern technologies
including radio signals,
automatically stock
replenishment systems,
warehouse management
systems and others (Kotler
and Armstrong, 2016).
(Opportunity)
Technologies help the
company in undertaking its
business operations
proficiently
Medium Long- term
Efficient technology can result
in consistent communication.
Environmental/Ethical
Canadian concern on
Ethical production of
product (no child labour/
no poor working condition
in factory/ recycled
materials)
(Opportunity)
H&M undertakes
environment friendly
activities through strategies
such as selling green
apparels, environment
friendly stores and others.
Medium Long-term
Company should regularly
communicate about its
initiatives to the society.
The Canadian government has formulated rules and regulations to be followed at the time of
formation of a company, employee hiring, employee welfare, fair competition, consumer
protection etc. H&M has followed the same and hence it can operate easily.
In reference to the economic factors, Canada is considered as a free economy that is not
dependent on other countries. According to a report by (Heritage Foundation,2022), Canada is
ranked at the first place in reference of economic freedom. Covid -19 has adversely affected the
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Canadian economy in the last two years. This has directly affected consumer purchasing power
and per capita income. Consumers may not purchase products from H&M if their income gets
affected. Hence, it is a threat. H&M uses modern technologies including radio signals,
automatically stock replenishment systems, warehouse management and others (Kotler and
Armstrong, 2016). Technologies help the company in undertaking its business operations
proficiently.
H&M undertakes environment friendly activities through strategies such as selling green
apparels, environment friendly stores and others.
The PESTEL analysis of the company clearly shows that the political, legal, economic,
technological and environmental factors are not major threats for the H&M (Baker, 2014). This
is because all these factors are behaving in a consistent manner since a long time. The
company has now understood the manner in which these factors behave and formulating
strategies for overcoming the hurdles. However, the socio -cultural factors can act as a major
challenge or threat for H&M. There are ten provinces in Canada and Ontario, Quebec and
British Columbia are the most dominant population in Canada (Johnson, 2019). This is because
it is difficult to attract the customers and retain them with the brand as customer do not have
brand loyalty for clothing since the clothing trend change rapidly so customer buy the brand that
keep up with the trend. It is evident that the competition has also augmented in this industry and
hence it is further becoming difficult for the company to attract and retain its customers. It is
recommended to undertake proficient strategies to nurture a strong relationships with the
customers and ensure that they remain loyal to the brand (Keller, 2012). With the help of this
strategy, it is very much possible to overpower the competitors and ensure that the customers
are engaged with the brand.
2.2 Competitor Analysis
It is highly crucial for the organization to analyze its competitors in the market as it may assist in
undertaking right strategies at the right time.
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From the above table, it is very much evident that H&M is facing a stiff competition in Canada.
Companies such as Magento, GAP, Uniqlo, and Shopify are multinational companies and have
a decent global brand image and summer clothing products. Following is a pie chart reflecting
the share of summer clothing products.
7
Actu
al
3
year
s
(Proj
ectio
n)
Competito
r Market share Products Price
Target
market
s
(region
s)
Target
markets
(segment
s)
Competitiv
e
Positioning
Strengt
hs
Weaknes
ses
Communication
content/claim
(CVP
Competitive
Value
Proposition)
Channels
of comm
Frequen
cy |
budget
Visual
Identity
and
Brandin
g
1
Magent
o
(PipeCan
dy, 2022)
(Hitt et al.,
2017)
29
%
32
%
Summe
r
Clothin
g
Penetrati
on
pricing
Full
count
ry
Young
middle
class
Low
prices
Strong
online
distributi
on
Less
focus on
physical
distributi
on
All the
communicatio
n
focuses
on providing
low prices to
the target
audience
Social
media
and
compan
y
website
Ongoi
ng Logo
2
UNIQLO
(Pearso
n, 2017)
(Hitt et
al.,
2017)
12.
5%
15
%
Summ
er
Clothin
g
Premiu
m
pricing
Full
count
ry
Young
upper
class
Unique
Fashion
Stron
g
brand
name
High
employ
ee
turnove
r rate
Its CVP is
focused on
providing
something
different to
the target
audience
Social
media
and
compa
ny
website
Ongoi
ng Logo
3
Gap
(Smith,202
1)
(Hitt et al.,
2017)
8% 9%
Summ
er
clothin
g
Premiu
m
Pricing
Full
count
ry
Young
upper
class
Good
quality
Strong
brand
name
Less
marketi
ng
activitie
s
All the
communicati
on
emphasizes
on the good
quality
fashion
products
Social
media
and
compa
ny
website
Ongoi
ng
Taglin
e
4
Zara
(Smith,202
2)
(Hitt et al.,
2017)
14
%
20
%
Summe
r
clothin
g
Premiu
m
pricing
Full
count
ry
Young
upper
class
Latest
Fashion
Strong
brand
name
High
employ
ee
turnove
r rate
Its CVP is its
13 days shelf
life that
helps in
providing
latest fashion
to the
customers
Social
media,
Internet
and
advertisi
ng
Twice
a week
Taglin
e
5
Shopify
(Bosa,
2022)
(Hitt et
al.,
2017)
10
%
12
%
Summ
er
clothin
g
Discount
ed
pricing
Full
count
ry
Young
upper
class
High
Discounts
Low
prices
Low
profit
margi
ns
Its CVP
revolves
around the
low prices
that it offers
to the
customers
Social
media
Ongoi
ng Logo

29
12
8
14
10
Competitors' Market Share in Canada
(Summer Clothes)
Magento Uniqlo GAP Zara Shopify
They already have established market share in Canada as discussed in the table and they are
future growing. Hence, it is difficult for H&M to capture market share. However, effective
strategies will be recommended to the company for the same.
2.3 Consumer’s analysis
During the consumer analysis, it was observed that the consumers are highly dynamic in this
category. They want to purchase the best product for them and hence they evaluate their
purchase decisions comprehensively (Miller, 2021). The consumers look for alternatives on
internet and social media or through the company’s promotional activities. This helps them in
knowing about the different brands offerings. They also evaluate the product based on different
factors such as price, brand image and the availability of latest fashion. Thus, the consumers
are very active in this category (Azad et al., 2019, p.183-189). Nonetheless, it should be noted
that both the segments selected by the organization are highly lucrative and presents a great
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Actu
al
3
years
(Projecti
on)
Performa
nce |
Financial |
Physical |
Social |
Ego |
Time
Low |
High VALUE Key MarComm Aspects along the Customer Journey
Custome
r
segment
|
descripti
on
Segmentati
on criteria Size of segment
Risk
perceiv
ed
Level of
involvem
ent
Benefit
s
Cos
ts
[Aware]
Problem
Recogniti
on
[Appeal]
Informati
on search
[Ask]
Evaluatin
g
alternativ
es
[Act]
Purcha
se
Decisio
n
[Advoca
te] Post
Purchas
e
Evaluati
on
1
Young
Custome
rs
Age
7
Milli
on
10
Million
Financi
al High Experiment
ers
Hig
h
External
Sources
Internet,
Social
media
Latest
fashion,
price
Quick
purcha
se
Satisfied
2
Middle
class
custome
rs
Income
12
milli
on
17
million Social High
Custom
er
Loyalty
Hig
h
Internal
Sources
Advertisin
g,
sales
promotio
n
Brand
image
Takes
time Satisfied

opportunity to it in the near future (Dulsrud and Jacobsen, 2009, p.203-218). The young
customers between the age group of 18 – 28 years are highly inclined towards purchasing new
apparels frequently. They are considered as shopaholics and consistently purchase apparels in
the market. This is a big opportunity (Azad, 2018). On the other hand, the middle- aged
customers between the age group of 29 – 40 years prefer purchasing on a consistent basis. It
was found that these customers may not have enough time to go out for shopping and hence
they prefer online purchasing of apparel products (Milakovic and Mihic, 2015, p. 409-432).
Although this is considered as a big opportunity but the customers were also found to be
experimenters in this category. This implies that they like shifting from one brand to another and
try products from different companies. In fact, many of the Canadian consumers are even price
conscious. (Anon, 2021, pp.6661-6678). This implies that they make their purchase decision on
the basis of low prices. Thus, they are also very much attracted towards the sales promotion
offers provided by the companies (Grant, 2015). This can be a big threat for H&M. This is
because it is very difficult to create consumer loyalty because of regular shifting of brands.
2.4 Internal context with VRIO Analysis
Element VRIO outcome S or
W Communications Insights
Product
Detailed assortment in summer
clothing.
S Regular communication with the customers to
inform them about the variety via displayed advert
(Hines and Bruce, 2007).
Price Competitive pricing. S Inform the customers about pricing to attract them.
(Hines and Bruce, 2007).
Place Less number of outlets. W Discuss more to increase the number of outlets by
conducting survey to decide for new outlet (Rana
and Allen, 2021).
Promotion Less focus on promotional
activities.
W Undertake aggressive promotions to communicate
with customers using social media that targeted
customer use the most. (Rana and Allen, 2021)
People High employee turnover rate
W Internal communication to understand and retain
employees by investing more in employee’s well-
being (Hines and Bruce, 2007).
Process Use of technology to streamline.
S Communication through technology streamlines
the processes (Rana and Allen, 2021).
Physical
evidence Great store design and ambience.
S Communicates with the customers through
signages, banners that reflect Canadian culture etc
(Hines and Bruce, 2007).
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The VRIO analysis of the organization clearly highlights that H&M is undertaking effective
strategies in reference to its 7 P’s (Lipschultz, 2020). Most of its marketing mix elements are a
strength to it.
An organization's supply chain network allows it to manage its costs effectively. The customer
benefits from lower prices due to this. And, high efficiency is another result of the company's
strategic leadership (Gaeva et al., 2021). The overview of H&M VRIO analysis ensure that the
internal activities are aligned with the expectation of the stakeholders as the analysis is
favourable to the company’s portfolio.
3.1 Objectives
(Kotler and Armstrong, 2016) are of a viewpoint that setting quantitative objectives can help in
implementing and measuring its success effectively. Taking this theory into consideration, the
objective of this campaign will be to increase the profits of the organization by 10 –15 percent in
one year time. Thus, the main goal is to increase the profits by 2023.
The customer life time value is a key concept that can help in increasing the company’s profits
(Huddleston et al., 2015, p. 561-574). The company will invest its resources in retaining the
customers and this may directly have a positive impact on CLV as well. (Kotler and
Armstrong ,2016) further highlight the notion of five A’s.
CJ Stage IMC objectives
Aware It is important to make everyone aware about the
objective of increasing 15 percent profit in one year.
Appeal The focus here will be to reduce the customer
turnover rate by 5 percent thereby increasing profits.
Ask Increase the footfall in the outlets through aggressive
promotional activities.
Act Capture more customers to increase the market
share and also enhance the profits in a sustainable
manner.
Advocate Enhance company’s brand image to make it more
popular in the market.
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4.0 Strategies
4.1 Target Segment
MKT segment attractiveness High 10
9
8
7 A
6
Med 5 B C
4
3
2
1
Low 0
10 9 8 7 6 5 4 3 2 1 0
Strong Average Weak
Fit to company and Network competencies
rating range 0 -
10
MKT segments attractiveness Segment A Segment B Segment
C
Weig
ht rating tot ratin
g tot rati
ng tot
Profit 28% 8 2.24 5 1.4 6 1.68
Market share 22% 8 1.76 7 1.54 5 1.1
Competitiveness 15% 9 1.35 7 1.05 6 0.9
Partnership potential 10% 5 0.5 5 0.5 5 0.5
communication channel availability 10% 7 0.7 4 0.4 6 0.6
Distributional channel availability 15% 6 0.9 6 0.9 5 0.75
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Totals 100% 7.45 5.79 5.53
0-10 74.5 57.9 55.3
rating range 0 -
10
Relevance of Business position/strength
Segments buying criteria - Fit to company and Network
competencies Segment A Segment B Segment
C
Weight rating tot rating tot rati
ng tot
Product quality 30% 8 2.4 6 1.8 5 1.5
Price band 20% 7 1.4 6 1.2 6 1.2
Availability of quantity and sizes 15% 8 1.2 5 0.75 7 1.05
Aftersales service intensity 10% 8 0.8 5 0.5 6 0.6
Public relation 10% 6 0.6 4 0.4 5 0.5
Sales channels 15% 5 0.75 6 0.9 4 0.6
Totals 100% 7.15 5.55 5.45
0-10 71.5 55.5 54.5
Based on estimated size, growth, and H&M's ability to better serve these segments than
competitors, each potential customer segment has been ranked from scale of 1 to 10, 1 being
poor and 10 being excellent.
 Segment A: 18-22 years old ABC 1 with an annual income of under USD 18000.
 Segment B: 27-33 years old ABC 1 with an annual income of USD 18000 to 30,000.
 Segment C: 40-60 years old ABC 1 with an annual income of USD 18000 to 30,000.
The GE matrix suggests that the consumers under the income of USD 18000 that comprises of
almost 28 percent of the population as the key target audience for the organization. This model
further states that the consumers between the age group of 18-22 years ABC 1 should be
targeted as they have a deep inclination, interest and attitude towards the fashion products
whereas segment B and C need to be selected due to their ages in spite of high income (Tang
et al., 2017). The company should focus on creating brand loyalty primarily with the help of
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