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The consumer base of H&M is predominantly female, comprising 68.38% compared to 31.62% male, with the largest age cohorts being 25–34 years (27.11%) and 18–24 years (16.35%) (Hm.com Traffic, Ranking & Marketing Analytics, n.d.).

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Demographics:

Age: Primarily 16-35 years old, with a mix of teenagers and older customers.

Gender: Predominantly female shoppers.

Income: Tends to have a mixture of income levels, due to them being a predominantly fast- fashion brand, it tends to attract people who are on lower incomes, but they do also have high earners who want to shop more affordable basic pieces for their wardrobes.

Location: Urban as well as suburban areas, sold in multiple countries, but tend to be most popular in London - where the flagship store is located.

Socioeconomie Status: Tends to be more lower to middle class income brackets.

Psvchographies

Lifestyle: Fashion loving individuals who love to shop the most recent trends and keep up to date with whats new in.

Interests: High interest in fashion, lifestyle, trends and celebrity culture.

Values: Self-expression, loves dressing to express themselves, loves staying up to date with the trends.

Aspirations: Want to keep up with the trends and what people are wearing, as well as staying up to date with popular culture and celebrity and influencer fashion - seeking inspiration from how they dress.

Behaviours

Consumer behaviour: Likes shopping affordable basic pieces, as well as trying their best to try and switch to being more sustainable, shopping from second-hand places and trying to rent items when they can.

Media consumption: They are active on social media platforms including- Instagram, TikTok, Pinterest, Youtube and follow many influencers who they take inspiration from

Shopping habits: Enjoys shopping both online and in store, depending on what they are buying, they just shop when and where is convenient, but are constantly looking at what they can buy next to stick with the trends.

Event participation: Would love to attend fashion shows and events, but currently does not, but enjoying watching clips from these online.

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198,000

emplovees globally (Smith 2023)

75

markets and e-commerce sites in 60 (H&M Group 2025)

17

billion in sales in 2025 (‘H&M (HM-B.ST) - Revenue’ n.d.)

89%

of materials used in H&M products were recycled or sustainably sourced (Group 2024)

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H&M’s net sales have demonstrated an overall upward trend, increasing from 187,031 million SEK in 2020 to a peak of 236,035 million SEK in 2023, followed by a slight decline to 234,478 million SEK in 2024 (H&M Group, 2023).

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Competitive Rivalry: (High) The fashion industry is intensely competitive with both global fast fashion players such as Zara, Uniqlo, and Shein, and local retailers competing on price, speed, and style. The fast-changing nature of fashion trends means that H&M must continuously innovate, release new collections quickly, and maintain aggressive marketing to retain its market share. This high level of competition puts constant pressure on margins and requires operational efficiency.

Threat of New Entrants: (Moderate to High) Digital platforms and social media marketing have lowered the entry barriers for new brands, enabling online-only retailers to gain traction without significant infrastructure. However, building global recognition, a reliable supply chain, and a broad product portfolio like H&M’s still requires substantial capital and expertise, which protects established players to some extent.

Threat of Substitutes: (High) Consumers have numerous alternatives, ranging from luxury brands and mid-tier retailers to second-hand clothing platforms, thrift stores, and even rental fashion services. The growing appeal of sustainable fashion and resale marketplaces increases the risk of customers switching away from traditional fast fashion models, which challenges H&M’s value proposition.

Bargaining Power of Suppliers: (Moderate) H&M works with a large network of third-party suppliers, which reduces its production control but gives it leverage due to bulk orders and global scale. However, rising material costs, supply chain disruptions, and increasing demands for ethical production are strengthening supplier influence, which could impact pricing and delivery schedules.

Bargaining Power of Buyers: (High) Shoppers are highly price-sensitive and have access to a wide range of brands offering similar trends and styles. The fast fashion model is easily replicable, and online platforms give customers the ability to switch brands quickly. Buyer power is further amplified by social media and online reviews, which can quickly influence purchasing decisions.

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H&M faces significant pressure from intense competition, empowered consumers, and the rising threat of substitutes, all of which challenge its ability to maintain price and brand differentiation. While its size and global reach give it some leverage over suppliers, the growing importance of sustainable practices and ethical sourcing could increase production costs and erode its advantage. To remain competitive, H&M must focus on strengthening its online presence, improving perceived quality, and positioning itself as a leader in sustainable and ethical fashion, reducing its vulnerability to shifting consumer expectations.

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To evaluate H&M’s market position, a competitor analysis was conducted using SimilarWeb website rankings and insights from a consumer survey targeting H&M’s core demographic (16–35-year-olds). The analysis identified Zara, ASOS, Primark, Urban Outfitters, and Abercrombie & Fitch as key competitors due to their similar audience profiles, price positioning, and online or in-store presence. Zara and ASOS emerged as direct competitors, offering trend-driven fast fashion and a strong digital footprint, while Primark competes primarily on price and high-street accessibility. Urban Outfitters and Abercrombie & Fitch, though slightly more premium, appeal to the same style-conscious audience and were frequently cited by survey respondents as alternative shopping destinations.

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Despite serving overlapping demographics, these brands take very different approaches to social media. H&M, with around 73 million followers and strong engagement per post, uses vibrant seasonal storytelling, inclusive casting, and limited hashtags—often just #HM, to build brand identity and maintain authenticity on Instagram and TikTok. Zara, nearly as large in scale, prioritises minimalist, high-fashion visuals and live-shopping broadcasts to appeal to trend-conscious consumers with a more curated aesthetic. Meanwhile, ASOS dominates influencer-driven engagement, collaborating with thousands of creators and leveraging user-generated content (#AsSeenOnMe) to sustain strong Earned Media Value. Primark leads TikTok engagement using humorously relatable micro-influencers and volume posting across owned and paid channels, despite lacking an e‑commerce platform. Urban Outfitters and Abercrombie & Fitch skew toward lifestyle-driven campaigns with curated visual content meant to build branded aspiration, though their social performance lags behind the fast-fashion giants in both scale and EMV.

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The projected growth of the fashion market from £684.97bn in 2025 to £900.51bn by 2029 with a CAGR of 7.64% presents a substantial opportunity for established brands like H&M. However, user penetration is expected to rise only slightly from 34.4% to 37.8%, which means H&M’s success will depend on increasing customer loyalty and average spend rather than solely targeting new customers. China, which is forecast to generate £214.93bn in revenue by 2025, remains the largest market but is also highly competitive due to dominant fast fashion players such as Shein and Temu, along with local consumer trends. H&M will need to focus on hyper-localised strategies, influencer collaborations, and faster product cycles or shift attention to growing markets like Southeast Asia and Latin America. The global ARPU of £304.90 suggests that H&M must leverage premium collections, resale services, and loyalty programs to boost customer value. Additionally, emphasising sustainability and circular fashion could help H&M stand out in a crowded and rapidly evolving market.

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Political:

Backlash in China (2021) and market exit from Russia (2022) show vulnerability to geopolitical tensions.

Trade tariffs, post-Brexit rules, and evolving global compliance add operational complexity.

Governments increasingly link trade and retail policies to sustainability and labor standards.

Economic:

Persistent inflation and rising textile/energy costs pressure margins.

Currency fluctuations (EUR/USD/CNY) affect global sourcing and reported earnings.

Fast-fashion market projected to exceed $150 billion by 2025, offering growth but intense competition.

Emerging markets with growing middle-class populations present expansion opportunities.

Social:

Rising demand for ethical, sustainable, and transparent fashion practices.

Risk of consumer backlash due to perceived greenwashing or unethical supply chains.

Social media and influencer-driven trends shape fast-changing consumer preferences.

Shift towards slow fashion and resale markets challenges traditional fast-fashion models.

Technological:

AI, data analytics, and machine learning drive forecasting, personalization, and efficiency.

Virtual fitting rooms, AR/VR, and mobile-first platforms improve digital experiences.

RFID and automation enhance inventory management and logistics.

High investment needed to stay competitive with tech innovations.

Legal:

New regulations (e.g., EU Corporate Sustainability Due Diligence Directive) demand strict supplier transparency.

Environmental laws require sustainable sourcing and waste reduction.

Data protection rules like GDPR affect online retail and customer data use.

Intellectual property risks persist in fast-trend replication.

Environmental:

Global pressure to reduce emissions, textile waste, and pollution.

H&M targets net-zero by 2040 and aims to halve emissions by 2030.

Circular fashion initiatives (e.g., garment recycling) are growing but face operational challenges.

Climate change threatens raw material supply and logistics stability.

H&M faces rising pressure to balance affordability with sustainability amid stricter regulations and shifting consumer values. While technology and e-commerce offer growth opportunities, economic volatility and geopolitical risks pose ongoing challenges. Success in 2025 hinges on agility, market diversification, and building trust through genuine sustainability efforts.

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Sustainability, Circularity & Social Responsibility at H&M

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H&M Group’s 2024 Sustainability Report spotlights circularity initiatives, emissions reduction and social responsibility in the fashion brand

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Our "Planet" rating evaluates brands based on the environmental policies in their supply chains, from carbon emissions and wastewater to business models and product circularity. Here we rate H&M "Not Good Enough". These are a few factors influencing its score:

It uses some lower-impact materials including recycled materials.

It follows an unsustainable fast fashion model with quickly changing trends and regular new styles.

It has set a science-based target to reduce greenhouse gas emissions generated from its own operations and supply chain but there is no evidence it is on track to meet its target.

It's published a biodiversity protection policy that applies to some of its supply chain.

Workers' rights are central to our "People" rating, which assess brands' policies and practices on everything from child labour to living wages and gender equality. Here we rate H&M "Not Good Enough". These are a few factors influencing its score:

Little of its supply chain is certified by crucial labour standards that help ensure worker health and safety, living wages, and other rights.

It received a score of 71-80% in the 2023 Fashion Transparency Index.

There's no evidence it supports diversity and inclusion in its supply chain.

There's no evidence it ensures workers are paid living wages in its supply chain.

During the height of the COVID-19 pandemic, it did not disclose adequate policies or safeguards to protect workers in its supply chain from impact of the virus.

Brands' animal welfare policies and, where applicable, how well they trace their animal-derived products are the focus of our "Animals" rating. Here we rate H&M "Not Good Enough". These are a few factors influencing its score:

It has a formal policy aligned with the Five Domains of animal welfare.

It appears to use leather, exotic animal hair, and silk.

Responsible Wool Standard certifies some of the wool it sources.

Responsible Down Standard certifies the down it uses.

It doesn't appear to use fur, angora, or exotic animal skin.

It traces some animal-derived materials to the first production stage.

Based on all publicly available information we've reviewed, we rate H&M "Not Good Enough" overall.

Last updated November 2023

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Our "Planet" rating evaluates brands based on the environmental policies in their supply chains, from carbon emissions and wastewater to business models and product circularity. Here we rate H&M "Not Good Enough".