H&M's Latest High-Fashion Line Is Not Going To Work

h&m mmm

I hate H&M’s MMM line.

Full disclosure: I am not, despite my gender, appearance, and industry insider perspective as a (former) model, a fashionista. I prefer simple to statement. Consequently, I must admit, from a fashion perspective, maybe I just don’t get it.

But I don’t have to.

The facts are in the numbers.  From a finance/management perspective, H&M’s MMM line is a terrible fit for the retailer.

A quick summary: for the past month or so, much  “internet ink” has been spilled celebrating the union (and official launch November 15) of avant-fashion line Maison Martin Margiela (MMM) for fast-fashion retailer H&M.  For those who aren’t “in the know,” French label MMM is the deconstructionist brainchild of eccentric Belgian designer Martin Margiela.  Traditionally priced in the 4-figures, the high level label boasts audacious lines, overwhelming silhouettes, and shockingly bold colour blocks.

This one-time pairing of MMM with the affordable retailer follows similar single-line partnerships between H&M and such brands as Versace, Marni, Lanvin, Karl Lagerfeld and Stella McCartney. With a “collection of about 100 items such as the $40 bodysuit, a $349 duvet coat, and oversized trousers for $129,” this particular pairing costs significantly more than the “average” H&M item(s), which start at approximately $9.99 for a basic t (though this MMM line costs significantly less than the “pure” label, which can set you back at least $1,500 for a simple pair of boots).

While the announcement last month that MMM (whose signature tag bears the numbers 0-23) would produce through H&M this one-time only “affordable” line forced the world’s fashionistas into a near apoplectic state of sartorial splendor, the move actually belies a structural and fundamental issue driving H&M further and further into unprofitable irrelevance.  Or at least more securely into second place, further and further behind fast-fashion giant Inditex SA, owner of Zara. 

And to be clear: no amount of orgasmic fashionista over-exuberance over the MMM line can stop this slide.

Here’s why: despite the waves of enthusiasm that accompany every announcement like the one cementing the “one-time only!” designer pairing between a label like MMM and H&M, H&M is currently, like its fast-fashion peer Forever 21, losing considerable ground in the constant, grinding fight for Generation Y/Millennial dollars. Partially due to manufacturing issues (Zara’s all but perfected the “idea one day, in store the next” operational model, while H&M lags behind in production pace), design concerns (Zara’s more “cutting edge,” while H&M’s style has, for the past 5 years or so, listed considerably from its original bricks-and-basics wear), and competitive pricing between the rivals, H&M appears at a loss for how to both lure in and maintain a steady, loyal customer base.  While young professionals, those once mainstays at H&M, regularly hit Zara for immediately stylish work (and weekend) gear on a weekly and monthly basis, H&M finds itself chasing a diminishing consumer base that seems to have found a consistent retail home elsewhere.


Consequently, instead of righting its listing design ship, the retailer now finds itself relying more and more on MMM-type joint-line stunts for consumer attention; which would be ok, if such “fashion events” made much of a dent on the company’s bottom line.  Instead, by attracting “one-time-only” consumers through events that, in turn, generally fail to “capture” the H&M “spirit and style,” the retailer has created a fashion hamster wheel on which it must relentlessly chase the “next hot line” in order to simply stay in place in the market.  By continually pursuing an elusive and notoriously not-fast-fashion-loyal fashionista crowd, H&M has lost sight of what made it a household name to begin with: simple, reliable, and, perhaps most importantly, extremely affordable transitional pieces that fit into almost any woman’s wardrobe.  Now, at least in my case, I have no idea what I’m walking into every time I step into an H&M – and, for me at least, that’s created an experience that hardly engenders brand or retail loyalty.  And judging by recent market-share numbers, I don’t seem to be the only one who feels this way.

Therefore, while much has been made of the MMM-H&M pairing, don’t look for the match to do much to H&M’s revenue this quarter.  The quick pop will soon be lost in the hustle and bustle of what will most likely turn out to be a lackluster holiday season that will punish retailers such as H&M that have failed to distinctively and qualitatively distinguish themselves from their competitors.

After all, a ridiculously-styled, overly-priced line does not a successful earnings, style, nor retail season make.

Margaret Bogenrief is a partner with ACM Partners, a boutique crisis management and distressed investing firm serving companies and municipalities in financial distress.  She can be reached at [email protected]  


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