- Old Navy and H&M are both known for carrying inexpensive basics.
- Old Navy has become a secret weapon for Gap.
- But H&M is struggling, seeing operating profit drop a whopping 62% in the first quarter of 2018. In June, it reported flat sales growth for the second straight quarter.
- During recent visits, we found that both stores seemed to have similar issues, from varying quality to unfashionable clothes, but one store had a clear advantage over the other.
Old Navy and H&M have become go-to stores for inexpensive basics like t-shirts and sundresses.
Old Navy has become a secret weapon for Gap Inc., seeing sales growth of 3% in its most recent fiscal quarter. In late 2017, Gap announced it would be shifting its focus away from its namesake brand and Banana Republic in favour of the Old Navy and Athleta brands.
H&M, a competitor of Old Navy, has had its fair share of struggles lately. In the first quarter of 2018, operating profit at H&M decreased 62%. In June, it reported flat sales growth for the second straight quarter. Business Insider’s Mary Hanbury reported that analysts believe H&M has a brand issue because it’s not the cheapest store, and its clothes are not the best quality nor the most fashionable.
When we visited both Old Navy and H&M, we found this statement to hold true for both stores – while both had a lot of great deals, they both still had a few overpriced outliers. The quality varied from product to product, and the styles were hit or miss.
However, we found that one store was a much nicer environment to shop in and had a bigger selection of everything from clothes to accessories. See what it was like shopping at each:
First I went to H&M in New York City’s Financial District.
The fluorescent lights and huge windows created a bright and airy atmosphere to shop in. Sundresses, blazers, and t-shirts were displayed in the front of the store.
The surrounding displays had similar basics for $US5.99 each.
This was one of the nicest H&M stores I’ve visited. Almost everything was spotlessly clean and nicely displayed, and most products cost less than $US50.
Some products were insanely cheap, like these $US6 tops. That being said, the quality varied from one product to another. Even though some of the products were very high-quality, others felt like they were ready to fall apart.
Sale racks were scattered around the store, with items ranging from $US7 to $US25 or more. Though this sale sign read $US7, there were only a few items on the sales rack at that price point.
Even though the store was in better shape than many other H&M locations, it was still pretty disorganized. Parts of the store seemed to be organised by colour, but the actual products were pretty random.
Jeans, hoodies, and floral dresses were next to each other.
It would be hard to shop for a specific product, like jeans, considering they were spread out all over the store and hidden between products like t-shirts and sweatshirts.
Although there were pairs of jeans spread out across the two floors, there was also a designated denim section in the back of the top floor. The prices were generally below $US20.
A huge part of the store was dedicated to accessories, with purses, hats, jewellery, and other small products on display in the areas surrounding the register.
The jewellery was simple and inexpensive.
Also in the accessories section were swimsuits, most of which were between $US4-10.
I found that the styles were pretty hit or miss, but the store was generally very trendy.
There was a designated men’s section on the second level …
… but a lot of the clothing on display was wrinkled or stretched out.
The prices were about the same as the women’s clothing, and it was just as disorganized.
The store, overall, had a lot of trendy clothes at low prices, but the quality varied, and it was confusing to navigate. Even though it was maze-like, it was a bright and generally upbeat place to shop.
The second store I visited was Old Navy in the Flatiron District.
In the doorway was a big red “clearance” sign advertising up to 75% off.
The marquee hanging in the entryway advertised free shipping on products if you can’t find the size you need in-store. Similar advertisements were posted around the store. Denim was stacked up at the front and had its own designated section. I noticed right away how much darker the store was than H&M.
Massive sale signs were all over the place. The styles in the front of the store were ok, but definitely not as trendy as H&M. Plus, a lot of the clothes on display were wrinkled and messy.
The prices in the store were similar to H&M, with most products costing under $US50.
Most of the clothes that Old Navy sold were simple sundresses, t-shirts, and jeans.
There wasn’t a ton of a variety in the styles, so it got repetitive going through the store.
It also sold athletic gear, but the styles were hit or miss.
Even though the store didn’t have anything that was really trendy or unique, it had a lot of inexpensive basics that were pretty high-quality. Like at H&M, the quality varied.
Old Navy had an entire wall of $US2 flop flops for the summer …
… but didn’t have nearly as many accessories as H&M. There were a few shelves of inexpensive jewellery …
… a handful of scarves and leggings …
… and an e.l.f makeup display. While everything was inexpensive, there just wasn’t a lot to choose from.
Upstairs there was a children’s shop, and downstairs was the men’s section. The men’s section was a lot bigger and more well-kept than the one at H&M, and a lot of the styles were similar. It was very dark downstairs.
There was also a massive clearance section that took up a quarter of the floor, on top of all the sales upstairs.
It wasn’t organised in any way, and it took up about a quarter of the store.
Even though the register was on the ground floor, you could check out anywhere in the store, so there weren’t any lines anywhere.
The prices and quality were about the same at H&M and Old Navy, but H&M had a much bigger selection in terms of the styles it offered, and the clothes were generally more trendy.
H&M also won in terms of atmosphere, creating a much brighter and more upbeat store.
NOW WATCH: Briefing videos
Business Insider Emails & Alerts
Site highlights each day to your inbox.