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Company Profile Of Hennes Mauritz Marketing Essay

1. Introduction

Let us suppose we have gone back a decade in time. There's a woman in a few area of the world flipping through the webpages of any high-fashion magazine. The minute she starts the magazine she is bombarded by images of luxury goods. Luxury brands like Versace, Chanel, Gucci and Christian Louboutin raise your voice to her. All she wishes is to possess at least one piece from these luxury fashion goods. Alas, the woman makes a middling income and can only just dream about owning a Versace dress or a pair of Christian Louboutin shoes. Thankfully for her, in 2004 Hennes & Mauritz (H&M) came up with a brilliant cooperation which made all her dreams become a reality.

For quite a while usage of luxury fashion goods had been limited by the elite classes. Because the 1990s there has been a boom in the luxury market because as times advanced traditional luxury brands such as Religious Dior started out facing competition from growing new luxury brands like Jimmy Choo. These new luxury brands brought in new branding and positioning strategies (Truong et al. , 2009). The result of these strategies was the materialisation of 'masstige brands'. Despite the fact that masstige brands are priced lower than very premium or traditional luxury brands, they still maintain a place above typical products and enjoy a high degree of prestige (Silverstein et al, 2005).

In order to handle competition experienced from these masstige brands, certain traditional luxury brands needed an unconventional step. In June 2004 Hennes & Mauritz (hereafter known as H&M) released that they might be releasing a limited edition collection created by none other than Karl Lagerfeld, chief creator of Chanel (H&M, 2004). With this step, H&M began a fresh pattern of 'co-branding' in the fashion industry between high-street and luxury fashion brands. Since that time H&M have undergone an gross annual collaboration job with some of the biggest brands of luxury fashion, the latest being French label, Maison Martin Margiela. With H&M making ongoing headlines in the style industry because of its collaborations with luxury fashion brands, the necessity to study the science of co-branding, especially popular, is becoming vital. Thus, this dissertation aims at exploring and looking into the word 'co-branding' and the role it plays between high-street fashion and luxury fashion brands. As H&M are the contemporary of this trend in the style industry, the issues discussed in this dissertation will be mainly based on them.

1. 1 Company Profile

Company name

H & M Hennes and Mauritz AB

Industry

Retailing

Sub Industry

Fashion (clothing, accessories)

Headquarters

Stockholm, Sweden

Employees

94, 000

Key People

Founder: Erling Persson

Chairman: Stefan Persson

CEO/Controlling Director: Karl-Johan Perrson

Table : Company Account of Hennes & Mauritz (H&M, 2012a)H & M Hennes and Mauritz Stomach is a Swedish retail company, working in the clothing industry. The company is well known for planning fast fashion i. e. stylish styles at cheap prices. The first store was opened in Sweden in 1947 under the name 'Hennes', offering only women's clothing. In 1968 the company bought Mauritz Widsforss, a hunting and sportfishing gadgets store, changing the company name to Hennes & Mauritz. This is also the year the company began providing men's and children's clothing. Today, H&M have branched out into five 3rd party brands which can be globally accepted - H&M, COS, Monki, Weekday and Cheap Monday. Besides clothing, today the company also offers shoes or boots, accessories, beauty products and furniture. By 2012, the business operates around 2600 stores across 44 countries. H&M's top two competition are Spanish fashion group Inditex (who own Zara and Bershka) and North american retail large The Space, Inc. From 2004 H&M started out collaborating with some of the biggest names in the luxury fashion industry, a custom they may have since followed each year. Besides H&M's gross annual collaboration with a few of the largest luxury fashion houses, the company also has a long-standing tradition of getting as well as ultra models and popular music artists to either design or be the faces of the seasonal selections and promotions.

1. 2 Problem Classification and Purpose

Co-branding is a relatively new concept in the field of marketing. The idea has been in practice for only the past few decades and the collaborations have often yielded blended results. Co-branding has occurred in all areas and market sectors from tobacco to vehicle to retail to film-making to consumer goods. Co-branding is a moderately new term available vocabulary which is employed to describe designed marketing activities affecting several brands (Blackett, Boad, 1999). It is important to analyse and understand the practice of co-branding as it's been gaining popularity in the recent years and can have a significant impact on the continuing future of branding. More and more consumer product manufacturers have become interested in co-branding strategies as it is a means to gain more exposure in the marketplace, combat competition and threats innovatively and at exactly the same time talk about expensive promotional costs with a partner (Spethmann, Benezra, 1994). Co-branding provides companies a great possibility to create something new, while posting costs, and also provides them with an opportunity to present consumers with market they may havent explored before. Besides considering traditional brand extensions and other brand alliance strategies (like advertising alliances and dual branding), co-branding is a strategy which presents a brand an added method to distinguish themselves in a competitive environment (Helmig et al. , 2008).

While co-branding in other sectors has went back mediocre results, co-branding popular has generally been extremely well appreciated. American discount retailer, Concentrate on, has often collaborated with designers such as Jason Wu, Issac Mizrahi and Neiman Markus, offering their designs for a marginally higher price than Target's typical rate. These tries have been very well received by the mass consumers. H&M, especially, have a high success rate when it comes to the business practice. A lot more than 1000 people got into New York's Fifth Avenue store in the first hour when Karl Lagerfeld, Chanel's haute couture and ready-to-wear main designer, created items for H&M (de Chernatony et al. , 2011). Another example will be the success of H&M and American designer Stella McCartney coming alongside one another. Queues were reported outside several H&M stores all over the world, developing from the night time prior to the collection was launched (Okonkwo, 2007).

However, as successful as H&M's makes an attempt at co-branding have been, this practice of luxury brands and high-street brands approaching together has business lead to a lot of argument and even criticism. Based on the critiques, co-branding often hampers with the business's original brand equity and confuses the buyer. Although the names of the brands that come jointly are familiar to the buyer, the real co-branded product is completely new. Thus, struggling to make out what things to think of the new product, the consumer makes a judgement predicated on the known brand names engaged (Washburn et al. , 2000). There have also been questions raised regarding the effect of co-branding on the image of 1 or both of the father or mother brands. Some critiques believe that co-branding hampers the trustworthiness of highly ranked brands.

There have been sufficient works as well as research conducted on co-branding which can be found to us. Appreciable research has been conducted on co-branding in the retail sector. However, there's not been much detailed research on co-branding specifically between high-street fashion brands and luxury fashion brands. A couple of questions quit unanswered in this specific area. Therefore, this dissertation seeks to investigate and examine the practice of co-branding in this specific field and desires to give a much better knowledge of this trend.

1. 3 Research Objectives

Taking into account the purpose of this dissertation, the key research objective that this study will attempt to answer is:

Exploring and understanding co-branding between high-street and luxury fashion brands.

In order to help present relevant answers for this dissertation, the key research purpose can be further divided into the next sub-objectives:

To understand why co-branding occurs between high-street fashion brands and luxury fashion brands

To analyse the belief of consumers regarding co-branding in the fashion industry

To analyse the result of such a cooperation on the brand image and trustworthiness of both people involved

To understand whether co-branding between a high-street and an extravagance brand can deliver successful results

1. 4 Relevance of the Research

The following section offers a justification about the relevancy of the study. Quarrels for both, academics and useful, relevance are mentioned.

1. 4. 1 Academic Relevance

This dissertation surely has academic relevance in the current time. In order to research co-branding in the style industry, this analysis has merged various branches of marketing. Brand alliances, brand collateral, brand leverage and consumer behavior are put together and discussed alongside one another to help understand the trend of co-branding. Although there is significant work already done on co-branding, just a few discuss the area in which co-branding has gained the most success - fashion. Thus, this dissertation attempts to give a specific and more descriptive explanation of why and how co-branding in fashion occurs and the consequences it has on the buyer.

1. 4. 2 Sensible Relevance

The functional relevance of the dissertation is also of significance. Co-branding is being commonly used as a technique to stick out in a packed market place (Dieleman, 2010). By understanding the technology of co-branding, not simply for standard understanding, but especially for the fashion industry, more retail clothing brands can partake in it. By learning consumers' perception into the cooperation of high-street and luxury fashion brands, managers can choose if building a co-branding strategy is the right methodology for them. Managers can also have a better gratitude of the consequences of co-branding on their brand equity and brand reputation.

1. 5 Limitations

As pointed out in the company profile, H&M have also collaborated with popular artists like Madonna and Kylie Minogue to conceptualise and be the faces of limited release lines and choices. Also, the fast-fashion company has collaborated with Finnish textile company, Marimekko, in the past to work with their textile designs on the products (Wettergren, 2010). These celebrities and companies are also brands in their own; however, this dissertation will not be speaking about them. Only H&M's collaborations with luxury fashion brands will be studied into consideration. Thus, this dissertation only examines the relationship of an high-street and luxury brand, and not between other types of brands.

This dissertation will not discuss the process of co-branding between H&M and the blissful luxury brands, however the motive and ramifications of the collaborations. The questions this dissertation will try to answer are why co-branding occurs and what are the possible effects than it. How co-branding occurs is a question this analysis does not project into. Also, this dissertation does not go too deeply in to the marketing activities of the co-branded products and retail collections. Thus, answers to these questions will never be available in this research.

1. 6 Structure

The following portion of this dissertation talks about existing concepts, theories and research conducted that resulted in the forming of this study's research question. The section is an assessment of existing literature as well as a demonstration of the theoretical framework. Concepts such as brand management, co-branding, fashion marketing, co-branding strategies, fashion strategies etc will be talked about. The third section talks about the methodology decided on to conduct this research. The chapter talks about the justification of choosing the study method as well as the possible limitations of the same. Chapter four represents the findings of the research as well as gives a discussion for every of the studies. This chapter evaluates the relevant research findings for every single of the research sub-objectives. The ultimate chapter of this dissertation presents a general discussion of the whole study, highlighting the key areas and important research conclusions. By the end of the dissertation is a set of references; resources which contributed to the research of this study as well as resources one can consider for the intended purpose of further reading.

2. Literature Review

2. 1 The Concept of Branding

Branding building is an important concept in the science of marketing and several definitions of this concept exist. The official explanation of branding directed at us by the North american Marketing Association is that a brand is "a name, term, sign, symbol, or design, or a combination of them, intended to identify the goods or services of 1 seller or group of sellers and to distinguish them from those of challengers. " Which means that even though something or service may satisfy the same need as another, a brand provides it with an aspect which differentiates it from other products or services of the same kind (Kotler, Keller, 2011). The process of brand building is important for almost all companies, products and services because building successful brands offers future income stream and income. Brands help build consumer loyalty which means that consumers will keep returning to choose the brands and will support them even during problems situations (de Chernatony et al. , 2011).

However, the profile of the buyer is changing from what it used to be. The market place gets more and more congested with the frequent addition of new products and services. Not merely does this imply that there's a lot of brutal competition, but also today's consumer has a lot more choice than from a decade ago. Thus, it is extremely essential to make one's brand stand out. This is where the idea of brand management will come in. Appropriate and effective practise of brand management can assist in leveraging a brand, which leads to the making of an effective brand. The idea of brand management was made by Procter & Gamble's Neil McElroy (Harvard Business Institution, 2000). Effective brand management can result in high brand collateral. Brand equity is the additional value which products and services are seen to have, besides the efficient value that they hold. This value is assessed on the basis of what consumers feel and take into account the brand as well as the market share and success that the brand loves (Keller, 2008; Aaker and Joachimsthaler, 2000; Aaker, 1996; Aaker, 1991). Proper practice of brand management can also do magic for the brand image. Brand image is impression of the brand's personality (real or imaginary) that is developed in the consumer's head (Business Dictionary).

Various techniques can be applied under brand management in order to leverage a brand. One of these techniques is brand expansion. Brand expansion is a online marketing strategy wherein an organization uses a brand name which already is out there in order to permeate into a fresh, different product category than which it is established in (Swaminathan, 2003). A relatively new development has been made from brand extension in recent years which is known as the process of co-branding.

2. 2 Co-Branding

Co-branding is a brandname leveraging strategy where two or more brands, each having significant acknowledgement in the eye of the buyer, co-operatively get together to make "an individual unique product" while keeping the names of all the brands included (Blackett and Russell, 1999; Leuthesser et al. , 2003). This term is generally known as 'brand alliance' and 'amalgamated branding'. Co-branding provides marketers with the decision of deciding on a short-term alliance, thus making it an attractive opportunity. It is not essential for co-branding to be a long-term affair, as along other benefits, marketers are mainly buying quick sales improve (Spethmann and Benezra, 1994)

As discussed by Nunes et al. (2003), co-branding can be split into four different types. They are as following:

Promotional/sponsorship co-branding - Here an organization co-brands by being an integral part of an event's activities in order to web page link its image compared to that event in the mind of the buyer.

Example: Conseco 'the official financial services provider' of NASCAR

Ingredient co-branding - In this type there is a primary brand, which operates as an important element of the secondary brand.

Example: Sony Vaio laptop with an Intel microprocessor

Value string co-branding - Here several companies come together in order to create a brand new experience for the consumer to increase differentiation. It can be further split into three types:

Product-service co-branding - Yahoo! and SBC Marketing communications coming together to form SBC Global Networks

Supplier merchant co-branding - Architect Michael Grave developing a line of co-branded products specially for American dealer, Target

Alliance co-branding - Airline alliances such as Celebrity Alliance and SkyTeam

Innovation based co-branding - In this type several companies get together in order to provide a whole new product or offering, to increase customer value as well as corporate value.

Example: Boating shoe manufacturer Sperry Top-Sider collaborating with New Balance to build an 'athletic boat shoe'

It is a known fact that brands play an important role in influencing culture in consumer societies. They not only meet one's utilitarian needs, but also serve some hedonic purpose. It isn't in the power of the marketing expert to set-up the hedonic value that the brands maintain. It is only the consumer who's in control of the feelings and meanings associated with a specific brand. Thus, it is safe to say that a area of the brand's equity is at hands of the consumers. Thus, the reason marketers choose a co-branding strategy is to not only access the utilitarian advantage which a certain brand offers, but also to create the hedonic value that your association recover brand would bring. There is a transfer of position, imagery and reputation of one brand to the other. Co-branding also reduces costs, as the R&D, creation and marketing expenses get shared between the mother or father brands. Thus, co-branding is a quick way of bettering all the aspects of marketing related issues (Askegaard and Bengtsson, 2005; Nunes et al. , 2003).

There are also dangers and disadvantages to co-branding. There may be the risk of dilution, where a brand loses meaning for a consumer because of the co-branded product. There's a chance of a co-branding strategy producing a potential rival. This happened when IMB partnered with Microsoft to develop DOS. Microsoft then acquired very low brand equity, but today these are a huge in the computer world. There is also the chance of devaluation. When aligning with a minimal valued brand, a higher value brand may lose its reputation in front of the consumers. Co-branding may also limit a brand's market reach as they might be focusing on the same consumer group with the new product as well (Nunes et al. , 2003; Leuthesser et al. , 2003).

Many theories and research have been conducted on brand alliances and their possible spillover results. One of the first ones was by Simonin and Ruth (1998). A report was conducted by them to evaluate the change in the attitude of consumers due to the spillover effects of co-branding. The results of this study have matched the results of several other newer studies conducted on brand alliances. Baumgarth (2004) created a brand alliance analysis, based on Simonin and Ruth's analysis. The results of the study matched up with the hypotheses presented by Simonin and Ruth. Baumgarth's model added improvements giving importance not and then the brand fit, but also to the last attitudes consumers have towards brands. In a study conducted by James et al. (2006), it was found that the personalities of the two brands involved have an impact on the conception of the consumers on the co-branded product. Bouten et al. (2011) too conducted a report, basing it on the Simonin and Ruth paper. The result of their analysis was a perfect fit of both, the brand image as well as the existing products of the parent or guardian brands is required for a successful brand alliance.

As brand alliances began getting popular, researchers started concentrating on the term 'co-branding'. Abratt and Motlana (2002) devised a five-step brand changeover process for companies who wished to undertake co-branding. The procedure stresses on the value of understanding consumer notion as well as the fit of the brands involved. The same result was observed in the strategic platform for co-branding created by Leuthessar et al. (2003) which would help marketers determine co-branding opportunities in order to leverage their brands. Based on this framework, possible co-branding can be assessed by the type of the mother or father brands as well as their concentrate on followers. Co-branding was little by little getting to be seen as an important online marketing strategy. Because of this, an ontology based mostly co-branding strategy system, called OnCob, was made by Chang (2008). This technique helps marketers and brand professionals research the co-branding trend predicated on the ideas of goal, category and effect. Co-branding was further researched by Chang (2009) to present a roadmap and guide for companies attempting to co-brand. Different establishments were mentioned wherein some results were successful, while some were a total failing. Also, a co-branding matrix was presented, which gives research workers a better knowledge of this emerging research.

The ramifications of co-branding on brand collateral were examined by Washburn et al. (2000). The study results exhibited that co-branding is a win-win situation for both the brands involved, regardless of their recognized brand value. Whenever a high equity brand is combined with another high collateral brand, the final co-branded product is perceived to have high value as well. Also, Washburn et al. discovered that regarding a minimal equity-high equity brand pairing, it is the brand with a lower value that benefits the most from the co-branding, and even though the positive effects might be less for the bigger respected brand, co-branding does not have any negative effects on it. Movement et al. (2003) conducted a study on corporate co-branding and its own effect on corporate brand equity. The research was conducted by learning the sponsorship of rugby team, All Blacks, by Adidas. The result of the analysis was that co-branding has an optimistic effect on the organization brand equity, however as concluded by other studies, it is important that the parent brands have a perspective and similar brand prices. Besharat (2010) undertook a study combining the strategies of co-branding and brand expansion. An evaluation between co-branding and brand extensions regarding brand equity was carried out. The final consequence of the study matched up the results of many past studies i. e. the success of a co-branding strategy will depend on the existing brand value of the parent brands. However, there is no significant difference between consumer perception of co-branded products or brand extensions. So long as the consumers observed a fit between the new products and the brand, they acknowledge the new product favorably.

A research was conducted by Thompson and Strutton (2012) to learn the consequences of co-branding when one of the father or mother brand co-brands into a product category where it generally does not exist. However, the research showed that such an alliance is improbable to be successful. For a co-branding strategy to be successful, it's important for consumers to understand a high level of fit between your brands engaged. Another finding is that if a minimal value brand collaborates with a brandname that is perceived highly in the eye of the consumers, the co-branded product may very well be seen favourably. Thus, the brand fit performs an exceptionally important role in the success or failing of co-branding strategies.

Erevelles et al. (2008) conducted a study on ingredient co-branding in the B2B sector, a location which doesn't have much research done. The finding of the research is the fact that ingredient co-branding occurs in B2B sector usually when there is a threat of accessibility from a more fiscally rich competition. Thus, brands enter an ingredient co-branding strategy to filter this competition. Besides this, the secondary brand also has economic benefits as the ingredient distributor provides their part at a lower life expectancy cost.

Askegaard and Bengtsson (2005) proposed the importance of cultural so this means in co-branding. Compared to the conventional approach to co-branding, their newspaper provides us with a fresh perspective. They advised that all brand characterises certain symbolic and ethnical meanings to the consumers, ones that may well not be obvious to us straight. The social meanings of the father or mother brands have much influence on the meaning that the co-branded product represents. However, the interpretations provided by Askegaard and Bengtsson are much too imaginative and descriptive. No matter how creatively brand professionals develop cultural interpretation for a co-branded product, by the end it is only the buyer whose interpretation of brand image and meaning count.

2. 3 Fashion

2. 3. 1 Luxury Fashion

Luxury brands contain those products and services which can be associated with the affluent and the elite course. The luxury fashion industry is a global multi-billion buck sector. A huge selection of brands are a part of this industry, some of them being Louis Vuitton, Chanel and Prada. Besides being valuable, luxury brands are some of the most influential on the planet. For luxury goods, branding performs an extremely important role and is the main competence. This sector places high importance on branding and marketing strategy development through human thoughts and mindset (Okonkwo, 2007)

Tynan et al. (2010) sought out to address the nature of the worthiness of luxury brands and how value can be co-created. Rather than taking the more common managerial perspective, they took into account the perspective of the consumer. They developed a theoretical framework and researched case studies to determine what forms of value consumers look for in luxury branded goods. The effect was that although a utilitarian value was essential for all luxury goods, it was the hedonistic or symbolic value which acted as drivers for the purchase of an extravagance good and was viewed as the differentiating factor by the consumers.

Reddy et al. (2009) researched the chance of brand extensions for a luxury brand. In order to do so, they fashioned a 'Superior Adgency Grid', which "measured the magnitude to which a specific brand extension matches up to the ideals embodied by the primary brand". The luxury brands were divided into the four quadrants of the grid - Star Brand, Aspiring Celebrity Brand, Waning Superstar and Dying Star. With the help of this grid, marketers could measure their luxury brand's brand adgency and then consider extension opportunities and the possible dangers.

A framework was created by Moore and Fionda (2009) illustrating the various dimensions of the blissful luxury brand to steer its marketing in the style sector. Their model identified nine key components which were deemed very important to the creation of an extravagance brand. Each of the nine components included sub-categories, which corresponding to them, must be regular for the successful creation of the brand. Many of these components must be handled together for the creation and maintenance of a successful luxury fashion brand position. Thus, the Moore and Fionda model state governments that the management of a luxury brand should be consistent and coherent. However, the situation companies in this research were all British isles and thus, the results are geographically and culturally small. A cross-cultural research could have provided a firmer information in the marketing of luxury fashion brands.

A five-factor model and brand luxury scale was created by Vigneron and Johnson (2004) to provide luxury product marketers with an instrument to gauge the amount of luxury a certain brand contains. Matching to Vigneron and Johnson, luxury is contained in brands in just a matter of level. Some brands have a very higher level of luxury, although some suprisingly low. The brand-luxury size helps gauge the level on luxury in confirmed brand. The research discovered that luxury is a multidimensional factor and this can be turned out by the five-factor model. These measurements can be established and monitored by using the brand luxury size in order to create a enduring luxury brand. However, Miller and Mills (2012) claim that more than anything else, it's the understanding of brand command that counts. To be able to attain clarity about luxury brand marketing, they developed a conceptual model - the Brand Luxury Model (BML). This results of this model declare that trendy, up-to-date and visionary brands and recognized to be more luxurious than brands that try to be unique, imaginative or original. The BML also exhibited that consumers understand a match between themselves and the image of the blissful luxury brand user's with mental or symbolic value. This finding is within sync with the research completed by Liu et al. (2012)

Liu et al. (2012) explored the effect that the many ideas of self-congruity theory have on the consumer. Self congruity theory was developed by Sirgy (1986), which refers to the likeliness of the potential consumer to psychologically compare themselves with other items and stimuli (brands in cases like this). This theory has been widely used to comprehend brand purchase behavior (Sirgy, 1986). The three ideas examined by Liu et al. are Brand Personality Congruity, Brand Consumer Imagery Congruity and Brand Consumption Imagery Congruity. The partnership of these three types of self-congruity to the customer attitude and commitment toward an extravagance brand are studied in this paper. The study focuses on two brands - CK and Chanel - to understand the effect of an potential consumer's self applied congruity in the purchasing of luxury brands. The study found that Brand Customer Imagery Congruity and Brand Use Imagery Congruity are much better predictors of frame of mind and loyalty than Brand Personality Congruity in either of the brands. It had been found that the consumer's own self-image and belief of the user's image as well as usage imagery play an important role in a consumer's purchase intent and attitude towards a brand. The findings of the study were similar to the previous claims made by Sirgy et al. (1997), Liu et al. (2008) and Sotiropoulos (2003).

2. 3. 2 High-Street Fashion

High-street fashion represents the clothing retailers who cater to the mass-market. These stores design and sell clothes that happen to be affordable and are used for mass-consumption. The brands either have indie stores, franchises or are an integral part of string stores. As the high-street fashion market began getting congested with the launch of more and more brands, competition started out running high. In order to battle this competition, many of the high-street brands started the idea of 'fast-fashion'. These are brands like Zara, H&M and Mango who create affordable, trendy and disposable items to focus on the consumers' requirements. Fast-fashion offers brands a competitive border as they transform the latest runway designs to chic disposable clothes that the mass-market can afford (Tungate, 2008; Hines and Bruce; 2001).

Following the success of fast fashion, Cachon and Swinney (2011) developed a modelling construction to identify the key areas of fast fashion i. e. improved design and quick response. The model demonstrated that fast-fashion comes with an extremely quick impact on the purchase decision of consumers. Thus, there are consumers who are quickly and willingly purchasing high-street fashion goods. While using customers of high-street brands increasing, the analysis of the belief of the brands became important. Willems et al. (2012) conducted a study on the impression consumers form predicated on another's fashion store patronage. The purpose of the study was to discover if people connect the personality of the brand with the personality of that brand's purchaser. Patronage of luxury as well as high-street brands was analyzed and it was concluded that not only does a high rank brand like Armani contribute to consumer personal information, but also a high-street brand like Zara does indeed the same. Thus, brand image management should be given importance by high-street brands and not only high-flying luxury brands.

Besides traditional luxury fashion brands and high-street fashion brands, a new group of 'new luxury brands' surfaced out in the first 90s. Truong et al. (2009) provided an empirical proof the life of masstige setting strategies for new luxury brands. The research studied two new luxury brands. The findings are that both the brands examined are identified, by the consumers, to be closer in prestige to the amount of traditional luxury brands, even though the prices of the new luxury brands are much nearer to those of the high-street/fast-fashion brands. This masstige strategy led the original luxury brands (plus some new luxury brands) to form fashion collaborations. A report on the collaboration strategies of fashion companies was conducted by Chun and Niehm (2010). They wished to identify the types of collaborations that happen in the attire companies and give an overall declaration on the collaborations. It had been discovered that luxury brands and mass brands will be the two areas where collaboration is generally performed. Although both collaborating brands tend to have differences, the overall results show that there are more common benefits involved. They also found out that the product/design was given the most importance in the outcome of the collaboration.

Based on all the literature reviewed it could be seen that there is sufficient work written on co-branding, luxury fashion and fast-fashion independently. Not just that, there are extensive smaller concepts linked to them which may have been thoroughly investigated too. However, there are not many empirical or theoretical researches conducted on the combo of the three principles. The result of co-branding in fashion does not seem to be deeply delved into. Thus, this dissertation seeks to bridge that gap and present a relevant research of co-branding between high street and luxury fashion brands.

3. Research Strategy and Limitations

3. 1 The Methodology

Research for this dissertation has been carried out by making use of the secondary research data already available. Secondary data is made up of sources of data and other information which is gathered by others, usually for an objective other than the challenge at hand, and is also archived in a few form. The sources of secondary information are federal government accounts, industry studies as well as books and journal articles found in libraries and directories. Secondary research is usually conducted before the beginning of any kind of primary research. Benefits of this research method are that it's a relatively economical method, being an inexpensive way of collecting data. This technique is also time-saving and quick, as often the sources are found archived in a certain location. Relevant extra data provides new and unique insights to the research problem accessible. However, there are certain disadvantages to the method as well. As most of the secondary research already conducted is made for a problem unique of the one at hand, there are issues of exactness and relevancy that certain might face. The prior research may not be relevant to the study being conducted or is probably not sufficient for this. Most important research might be necessary to gain full information on certain issues. Addititionally there is the likelihood of the info being outdated (Stewart, Kamins, 1992; Malhotra, David, 2007).

This dissertation has gathered and summarised data which already exists on the market regarding co-branding, especially in the retail sector. Co-branding has been extremely popularised within the last decade and considerable amount of research has been done upon this subject.

3. 2 Why Secondary Research?

Co-branding can be analysed either through primary research or secondary research. Ideally, most important research for this study would use interviews with top managers of high-street fashion brands as well as luxury fashion brands and questionnaires distributed among the list of consumers. However, credited to restrictions located on available employees of relevant companies, there's been some difficulty to carry out primary research. Regrettably, senior employees and management never have been designed for an interview.

That would leave us with the option of taking into account just the views and views of the consumers. However, simply doing most important research with the consumers would not be sufficient. It could not justify this analysis because this study investigates the overall need and effect of co-branding, considering both, the two parties included, as well as the consumer perception towards the practice.

In order to not present a half-view dissertation, this research study is entirely predicated on the recent literature concerning co-branding. Since several studies are present, the available resources are considered to be sufficient. Although there is not much research conducted to the utilization of co-branding solely in the fashion industry, extensive research is on the utilization of co-branding in other retail industries. These conducted studies have rules and theories which is often applied to the fashion industry as well.

3. 3 Secondary Research Data Sources

The secondary data because of this review has mainly sourced from books and academic literature predicated on branding techniques by widely recognized writers like Tom Blackett, Bob Boad, Leslie de Chernatony and David Aaker. These creators are known to be the gurus of branding and brand management and have written noteworthy works on the subject matter, especially on co-branding. Other academic textbooks based on the basic concepts of marketing and consumer behavior have also been used to investigate this dissertation. Besides these, textbooks regarding the fashion industry and fashion movements are also investigated.

Besides the utilization of books and academic literature, web-based articles and magazines are also sourced out. Marketing publications, brand management publications, consumer marketing publications and fashion publications are sought and thoroughly read. Directories are loaded with educational articles regarding co-branding, brand alliances and consumer behavior. These articles are of tremendous importance to the study.

When it comes to the style industry, it is one of the very most fast-changing industries away there. Not only fashion trends, but also the marketing movements in this industry are rapidly changing every day. Thus, magazines and periodicals play a very important role as they are the newest way to obtain information and therefore, they too have been utilized.

Another important segment here is the fashion blogging community who play a very important role in the influence of fashion on the mass market. Not merely do the consumers consider them important, but so do the fashion brands themselves. Therefore, the view of fashion bloggers is imperative to be looked at. These fashion sites have also been read and evaluated in order to aid the academics and commercial research.

3. 4 Limitations

As mentioned previously, this dissertation does not collect any form of main data. This review does not look at the immediate views and ideas of fashion brands and their consumers, but bases the evaluation and findings on the supplementary research that was already conducted in this study's field. Thus, the dissertation does not go into as much of the facts of co-branding in the style industry as the author would have liked, specially when reporting the conception of consumers towards this practice. However, regardless of these limits, this dissertation has tried out to give an accurate account of the proposed research target.

To conclude, all the findings and results from all these options have been carefully analysed to come quickly to a significant and coherent final result on the affect and popularity of co-branding in the style industry. The results of the research can provide an insight into the rising acceptance of retail co-branding and moreover, if it's best suited for the style industry as well. This study is an perspective into the trend of fashion co-branding which is quickly gaining popularity. However, the research outcome is by no means meant to be definitive as it includes taken into consideration only extra research sources anticipated to non-availability and unresponsiveness of the mature employees of the relevant establishments.

This section can be an analysis of the research objectives based on the example of H&M co-branding with various luxury brands. The evaluation is conducted through secondary research resources, most of which are reviewed in the books review. Textbooks, journal articles, theses, newspapers articles and mag articles have been analysed in order to present the research findings.

Since 2004 H&M has had an annual custom of collaborating with visitor designers to set-up limited edition choices for the Swedish retail brand. These guest designers are a few of the biggest names in luxury fashion, known because of their experience in haute couture, avant-garde and prЄt-a-porter designs. http://www. thestylecolumnblog. com/wp-content/uploads/2011/12/smhm. jpeghttp://www. thestylecolumnblog. com/wp-content/uploads/2011/12/karl-lagerfeld1. jpg

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H&M's first collaboration was with German fashion designer and creative director for Chanel and Fendi, Karl Lagerfeld, for H&M's fall months 2004 season. The collection, called 'Karl Lagerfeld for H&M' consisted of 30 pieces designed by Karl Lagerfeld and was reported to be sold-out within half a day of release all over USA and Europe (H&M, 2004; WWD 2004). The next collaboration is at 2005 with English designer, Stella McCartney. Called 'Stella McCartney for H&M', the 40 piece one-time collection was designed solely for women's wear and released in only 400 H&M stores around the world. The designs were based on previous selections by Stella McCartney (H&M, 2005a; H&M, 2005b).

Dutch duo, Viktor & Rolf, was the 3rd to come into cooperation with H&M because of their autumn 2006 collection. The collection was called 'Struck by Love' and was made up of 35 items for women's wear, including a marriage dress, and 25 pieces for men's wear (H&M, 2006a; H&M, 2006b). The fourth cooperation H&M partook in was with Roberto Cavalli, Italian luxury fashion giant. 'Roberto Cavalli at H&M' was a 20 portions men's wear and 25 parts women's wear party collection having Cavalli's signature canine prints. Like the previous guest custom made selections, this collection too was limited edition and sold in mere 200 stores (H&M, 2007a; H&M 2007b). The next collaboration was at 2008 with Japanese fashion label Comme de Garons. The label's head creator, Rei Kawakubo, designed a special collection for H&M featuring women's wear, men's wear, children's wear and accessories. This cooperation also designated the opening of H&M's first store in Tokyo, Japan (H&M, 2008a; H&M, 2008b).

Seeing the successful consumer response, from 2009 onwards H&M made a decision to undergo a collaboration project twice in a yr. The first cooperation that season was with English developer, Matthew Williamson. Matthew Williamson designed not just one, but two selections - one for spring and the other for summertime that have been released individually (H&M, 2009a). The next collaboration that yr was with London founded couture shoe artist, Jimmy Choo. A special collection of everyday to get together shoes, luggage and accessories for both women and men was released in fall 2009 in a limited number of H&M stores (H&M, 2009b). The end of 2009 also found H&M collaborating with French artist, Sonia Rykiel. A first of its kind, a lingerie and related accessories collection was released for Christmas 2009. Not only was this collection available at H&M stores, but also at Sonia Rykiel boutiques about the world. Sonia Rykiel also designed a knit-wear collection for H&M for spring and coil 2010 (H&M, 2009c).

Autumn 2010 found the collaboration between H&M and French design house, Lanvin. Lanvin's artistic director, Alber Elbaz got before stated that he would never do a mass-market collection; however he was intrigued by the concept of H&M doing luxury fashion (H&M, 2010). Another grand collaboration was observed in 2011, when Versace created a limited edition fall collection for H&M. The collection was designed by Versace's creative director, Donatella Versace. The parts were reminiscences of Versace's earlier works (H&M, 2011a). Italian designer brand, Marni was seen to be collaborating with H&M for springtime 2012. A series feature Marni's signature prints and items was design by the label's founder, Consuelo Castoglion. The collection was for both, women's wear as well as men's wear (H&M, 2011b). The most recent collaboration that H&M has been through has been French design house, Maison Martin Margiela. The exclusive collection is touted to be released in autumn/winter 2012 and will feature clothing and accessories for men and women (H&M, 2012b).

Based on H&M's co-branding record, questions arise as to why luxury brands choose to co-brand with a high-street retail brand like H&M? What exactly are the effects of such collaborations and the way to the consumers perceive them? Is this a successful branding strategy? Answers to these questions will be discussed in the following sub-sections.

4. 2 Motive for Co-Branding

Before evaluating other question, it is important to comprehend why H&M undertook a co-branding strategy and also, why do luxury brands keep coming to H&M to co-brand?

According to the four types of co-branding provided by Nunes et al. (2003), the type that fits H&M's co-branding strategy best is value chain co-branding. As discussed by Nunes et al. , value string co-branding occurs when the father or mother brands get together to offer an totally new experience to the buyer. This sort of co-branding usually occurs to generate a new level of customer value as well as differentiation. Today's individuals are not satisfied seated in the fashion sector (luxury or mass fashion) they have been allotted. A shift has been seen in consumer preference where the same consumer who be willing to shell out a lot of money for a Chanel carrier would not mind purchasing a Ј30 Topshop dress to go with it.

Sensing this change in consumer fashion, H&M and Karl Lagerfeld made a decision to give you a product which includes both, the look and brand name of an extravagance brand as well as the affordability of any high-street brand. Thus, luxury brands could show that they too could focus on a mass audience, bringing in a fresh customer base in the long run, and H&M will make an image transfer from yet another fast-fashion brand to a quality 'massluxe' brand (Tungate, 2008).

As reported by Melanie Rickey (2004), the latest results showed that there was a reduction in the profit produced by luxury brands; however high-street brands were enjoying a jump in gain at least 10%. The post-9/11 economical crisis observed luxury brand consumers tightening up their storage compartments and looking for more economical alternatives. Also high-street brands were appointing their own clubs of in-house designers who had been producing runway designs and quality products. Consumers still desired luxury goods, but if a high-street brand was offering something special and of good quality at the right price, consumers began experiencing more sense in investing in a quality high-street garment than an exorbitantly costed luxury garment.

While luxury brands were facing competition from high-street brands, high-street brands possessed started out facing competition from 'value stores' like TK Maxx and Primark and the rising supermarket fashion brands. The supermarket fashion brands are available at an exceptionally cheap price and are gradually creeping for the designs and styles proposed by high-street brands. Asda's brand, George, and Tesco's Cherokee and Florence & Fred had begun offering more clothes than even Markings & Spencers (Tungate, 2008). Thus, it became necessary for high-street brands to identify their image from these 'value for money' supermarket fashion brands.

As a result of this circumstance, it became essential for both, high-street brands and luxury brands to conform a new online marketing strategy. This resulted in H&M contacting Karl Lagerfeld with an offer to create a special limited-edition type of clothing for H&M. The collection was a smashing success and was sold-out globally within time. Not only have this cooperation give H&M an added advantage compared to other high-street brands, but also begun the change of H&M's brand image. For Karl Lagerfeld advantages were of revealing his brand and communicating to a sector of the audience he had never explored before. The power for both the brands was the showing of production and advertising costs as well as the promotion this short-term co-branding alliance helped bring with it (Blackett and Boad, 1999).

Seeing the buyer response and promotion that the 'Karl Lagerfeld for H&M' cooperation created, soon other luxury brands that H&M contacted were eagerly engaging in co-branding strategies with the Swedish retail large. Their collaborations with H&M were short-term as well as for a one-off collection. Thus, the luxury brands didn't have to totally increase downwards towards a masstige strategy, but could focus on a new consumer group at the same time. This helped in broadening their customer foundation as well as increasing presence and consciousness (Ginman et al. , 2010).

4. 3 Consumer Response and Perception to the Co-Branding

Both, H&M as well as the blissful luxury brands, are trying to develop their customer bottom part as well as satisfy the demanding needs of the mass consumer for a new experience. However, what truly will be the perceptions of the consumers to the practice of H&M co-branding with various luxury brands?

Several studies conducted on brand alliances and their spillover effects can be employed to the exemplory case of H&M and co-branding. Among the first studies conducted by Simonin and Ruth (1998) mentioned that brand alliances definitely have spillover results on the brand behaviour of the consumers. Thus, it is rather important for the father or mother brands to have a good fit. Baumgarth (2004) broadened Simonin and Ruth's analysis and the study unveiled that not only consumer's notion to the brand fit, but also the consumer's prior attitude towards both brands engaged should be taken into consideration. Another thing to bear in mind is the consumer's perceptions of the personalities of both the brands included. If consumers see a fit in the brand personalities of the parent brands, the co-branded product may very well be success (James et al, 2006).

Taking these studies at heart, it's important that the consumers see a match between your brand fit and brand personality of H&M and the collaborating luxury brands. Additionally it is important to consider what existing frame of mind the consumers have towards both, H&M and the blissful luxury brands. If the father or mother brands have a strategic purpose and clear synchronisation to the co-branded product, the mark audience perceives the product with a good outlook. As long as the mark audience perceives the convergence of the brand emails and joint profit, the response is favourable towards to the merchandise (Okonkwo, 2007).

H&M's collaboration with the luxury brand designers are not only limited edition and one-off series, but also they are available in only a limited variety of H&M stores about the world. This increases the exclusivity of the 'for H&M' artist collections. In a research conducted by Wettergren (2010) it was found that H&M's regular customers see this annual cooperation as a annual treat and look onward to it every year. Throngs of men and women have been reported to queue outside H&M stores time before they open on the day the collections are released. Almost all of the selections are known to be sold-out within hours of release. Thus, some consumers complain that these collections are not very accessible and most of them cannot get their practical even one item. However, a study conducted by Ginman et al. (2010) argues that not all consumers see this collaboration in a good light. Some consumers who like luxury brands to high-street opine that by catering to the mass audience, luxury brands have become more accessible which in changes makes them less exclusive.

As reported in The Daily Email, the latest two collaborations of H&M with Versace and Marni respectively observed a frenzy of purchasers all around the world swarming into stores. People are recognized to make mass buys and then sell the limited model clothes on ebay. com at a much, higher price. In order to stop this practice, H&M released a guideline that only one item of a certain design can be purchased by one customer. Hundreds of people queue outside H&M stores as soon as the night before of the release. To be able to handle such an enormous crowd of individuals, they are split into groups and receive a ten-minute time slot machine game per group to look. Despite having these management techniques, the 'Versace for H&M' collection was sold-out in flat 30 minutes. The 'Marni for H&M' collection turned out to be H&M's most successful collaboration task. When asked some of the shoppers why they have been queuing since the night before when the choices are sold online on H&M's website as well, the response was that before, as thousands attempt to sign on and shop, the website had completely crashed down and by enough time it was up, everything was sold-out there as well (Arthurs, 2011; Arthurs, 2012).

Thus, taking a look at the aforementioned example it is safe to say that the consumers are seduced towards to annual cooperation strategy of H&M. A fit is likely to be seen between H&M and the luxury brand it chooses to co-brand with for consumers to look absolutely ballistic every year for the limited release collections, at least when it comes to the mass consumers. In the study conducted by Ginman et al. (2010) it was found that barring a few, the majority of the blissful luxury brand users too saw the these collaborations favourably. The reasoning was that the luxury brands aren't extending into the mass market forever, but merely planning a one-time collection for H&M. The luxury brand designers were just offering their touch to the garments suitable for H&M and not creating a completely new entity. Thus, like Alber Elbaz said, it was more of H&M doing luxury than Lanvin doing mass market (H&M, 2010).

4. 4 Effects of the Co-Branding

In the previous section it was seen that the consumers' response and notion towards H&M's co-branding strategy with luxury brands is majorly seen to be positive and welcoming. However, one must check out the overall effects this plan experienced on H&M and the blissful luxury fashion brands, taking the brand into point of view.

Many mass consumers were not alert to most luxury brands until they started collaborating with high-street brands. It had been only when they read a name before 'for H&M' that many of the mass consumers learn the lifestyle of this luxury brand. This has been turned out in Ginman et al. 's (2010) and Wettergren's (2010) research. When asked about the awareness of certain luxury brands, it was found that the least consciousness was shown in the consumers who shopped at the mass market only. They only accepted the brands if they had previously collaborated with H&M. Thus, by collaborating with H&M, the luxury brands increased their brand presence as well as awareness. A lot of the luxury brands have partaken in brand extensions. Even if the mass consumer cannot afford to buy a garment from these luxury brands, they can save up to cover something from the cosmetics or accessories extensions of the blissful luxury brands.

Next, the effect of co-branding on the brand equity of H&M and the luxury brands is investigated. Luxury brands are usually seen to acquire higher collateral than the collateral possessed by H&M. However, there is no reduction in the brand equity of the blissful luxury brands when you are combined with H&M. This has been proved in the previous section where it was found out that consumer notion of luxury brands will not get affected as the collaboration with H&M is merely one-off. In fact, co-branding is a win-win situation for both the brands involved. Corresponding to Washburn et al. (2000) in co-branding it is always the brand which includes the lower (comparatively) collateral that benefits the most by being paired with a higher equity brand. Thus, H&M relishes the status to be in cooperation with various luxury brands, which contributes to a rise in overall brand equity. At exactly the same time, the luxury brands wthhold the status and equity that they always possessed. Co-branding is also seen to have an effect on the corporate brand of H&M and the blissful luxury brands. In a report by Action et al. (2003), it was demonstrated that by collaborating with a brandname valued and respected by the consumers, there can be a growth in the corporate brand equity as well.

With the upsurge in brand consciousness and brand collateral, not only was there an effect on the brands themselves, but also their consumers. Since high-street brands like H&M started getting into the limelight, consumers began making perceptions about H&M's customers. Depending on the brand patronage, perceptions are made about the client. Thus, co-branding with luxury brands has resulted in dependence on additional attention and importance towards brand management for H&M (Willems et al. , 2012). Also, predicated on the Home congruity theories by Sirgy (1986) and Liu et al. (2012), brand management following a co-branding strategy becomes even more important. Home congruity is when a consumer psychologically compares themselves to brands. Because the 'for H&M' products aren't entirely the blissful luxury brands' or H&M's, when self congruity occurs for the co-branded product, the evaluation might copy to the mother or father brands i. e H&M and the blissful luxury brand. Thus, H&M as well as the blissful luxury brands must work hard to maintain and/or improve their brand image accordingly.

After many years of co-branding with various luxury brands, H&M is currently rumoured to be releasing its luxury label '& Other Testimonies' in a chain of luxury stores had by them. Along with the success of co-branding, H&M realised the consumers' increasing dependence on massluxe products. Also, by their regular cooperation with luxury brands, H&M are able to differentiate themselves from other high-street brands and have slowly transferred their brand image from yet another high-street to a massluxe brand (Milligan, 2012). Thus, another effect of continuous co-branding in the right path is brand personal information change as well as brand extension.

4. 5 Overall Success and Possible Risk

This section handles the success as well as risk a co-branding strategy in the fashion industry brings. Based on the real life cases discussed in the last sections of H&M and the blissful luxury brands it co-brands with as well as the 'Pros and Cons of Co-Branding' (Labbrand, 2011; desk 2) we can create the factors of success and the possible risk of co-branding.

Pros

Cons

Luxury Brands

High media exposure

Expanded and new customer base

Increased sales volume

Could damage brand image and dilute brand equity

Negative experience associated with partner brand might transfer

Fast Fashion Brands

High multimedia exposure

Increases sales revenue

Differentiation from other fast fashion brands

Brand positioning more premium

Could mistake consumers and dilute brand equity (especially brand knowledge)

Table : Pros and Cons of Co-branding (Labbrand, 2011)

A co-branding strategy, especially between H&M and a respected luxury brand like Marni, Lanvin, etc is bound to attract a whole lot of attention. H&M's unique co-branding strategy was questionable and immediately found the interest of the world (Okonkwo, 2007). On top of that, each of H&M's collaborations has received a phenomenal response from the consumers. Thus, with every new cooperation, the advertising coverage received to the co-branded collection was massive. Both, H&M and the luxury brands basked in this media exposure.

The co-branded collections for H&M, whichever the blissful luxury brand is, is known to be sold-out worldwide within a few hours to a half of a day maximum. Therefore, co-branding can be called a reliant method to get yourself a quick sales boost. As the gains of the co-branded products are shared by the mother or father brands, H&M as well as the blissful luxury brands obtain an increase in sales, covering all the development and promotion costs as well.

An advantage for the blissful luxury brands that shines through this co-branding strategy is that the customer bottom part of these brands has been broadened. Mass consumers who had been previously unaware of the blissful luxury brands now recognise them. Also, a new 'massluxe' market is released to them, who can purchase the less expensive brand extensions of the blissful luxury brands.

Whereas, for the high-street brand i. e. H&M the advantage is the fact that by undertaking twelve-monthly collaborative strategies, H&M is differentiating itself from your competition faced from other high-street brands like Zara and Topshop. By constantly appearing besides names like Versace, Jimmy Choo and Roberto Cavalli H&M created a variation between itself and the other high-street brands. By doing so, H&M also created a shift in its brand image over time. Instead of a shocking brand extension, H&M is now able to create a steady, well planned expansion in to the luxury brand category.

Overall, the practice of co-branding between H&M and the various luxury brands has garnered positive response and results. However, as the critiques would say, there are certain risks involved in this plan too.

There is definitely the fear that being combined with the mass market can affect the brand image of the blissful luxury brands. This may have a poor impact on the brand collateral. Some even see the luxury brands as sell-outs for collaborating with H&M. Muiccia Prada has insisted, such a collaboration is something she'd never do as the co-branded designs are just copies of the luxury brand's previous series (Milligan, 2011).

Another risk that comes between H&M and luxury brands co-branding is a negative experience. Even though 'Karl Lagerfeld' for H&M was one of H&M's most successful collaborations, Karl Lagerfeld was not too happy with how things were managed. He accused H&M for 'snobbery' for producing


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