H&M Targets Chinese Shoppers With Alibaba’s Tmall Launch

In an effort to better compete in China, H&M has rolled out its core brand on Alibaba’s Tmall. The move marks the first time H&M has sold its main brand through a third-party retailer, trade publication Business of Fashion reported.

The Swedish retailer entered China’s online retail market with its own eCommerce store in 2014. But that site faces competition from Chinese eCommerce retailers, such as Tmall and Taobao, which dominate the Chinese eCommerce landscape.

As a result, Magnus Olsson, H&M’s China country manager, told Business of Fashion that the retailer needs to meet customers where they shop — on those online retail platforms. He also said the product offerings and pricing on Tmall would not be all that different from those on H&M’s own Chinese site.

H&M also has to keep in mind what products consumers in China would like to purchase. With increased price transparency and competition from rivals, H&M is now seeking to meet regional demand within the country.

“Something we’re really focusing on is trying to understand where consumer behavior, and especially here, the fashion sense of the consumer is heading,” Olsson told Business of Fashion. “We create more and more Asia-specific or China-specific collections.”

The news comes as H&M has announced that 2018 will feature fewer brick-and-mortar store openings as it moves to adapt to increasingly digital shopping patterns. The move comes after years of rapid growth from the fast-fashion giant, which now finds itself struggling somewhat to integrate into the eCommerce landscape.

According to CNBC, H&M plans to open about 220 stores in 2018, as opposed to the 388 built in 2017. However, 220 is a net number; H&M will actually open 390 stores and shutter 170.

“The scale of the reduction will surprise some today. And it will leave the bears questioning why H&M still enjoys a ‘growth stock’ rating,” Morgan Stanley analysts Geoff Ruddell and Amy Curry wrote. They had categorized H&M as an “underweight” stock.