Global pricing strategy
With H&M entering into the Australian market, one of the biggest areas of interest for local retailers is how they price their offering. When Zara and Topshop first opened there, they increased prices from the base UK amount – would H&M do the same? Or are would they absorb the increased cost of shipping and high local rent to maintain their worldwide pricing?
Comparing the price of garments online at H&M Australia, UK and the US we can see that pricing for Australia is much closer to the UK base than that of the US, and the price spread, from entry to exit, will feel very similar to the UK. However, the average price has been lifted more significantly for Australia than they did in the US. There are dramatic increases in the top ends of H&M range in the US; for example, a pair of women’s leather leggings saw a 23% increase from the UK market to the US, as did a men’s leather jacket. Conversely, Uniqlo did the opposite when entering the US market – they dropped the average price point and exit price.