Fast fashion: Inditex and H&M towards upgrading: premium fashion and prices will grow in 2021

Fast fashion: Inditex and H&M towards upgrading: premium fashion and prices will grow in 2021

The two major exponents of world fast fashion are beginning to change their skin, driven by the new ecological currents in favor of a more conscious consumption and as a strategy to maintain profits in a market moment marked by the increase in the prices of raw materials, from expensive energy and disruptions in the supply chain.

As reported by the Spanish magazine Modaein 2021 the giants of fast fashion Inditex e H&M have embarked on a new path of upgrading, increasing the premium collections within their offer and, at the same time, raising the price lists.

A move that must be interpreted not only as a strategy to cope with the increases in raw materials prices and the costs imposed by the transformation in an eco-sustainable key, but also to differentiate and counter the irruption of very aggressive competitors such as the Chinese. Sheinwhich thanks to ultra low cost prices and massive communication on social media is becoming one of the privileged interlocutors of Generation Z.

More premium fashion, therefore, for Inditex and H&M: according to the data provided by Retviewsthis offer segment for the Iberian group went from 4.1% in 2020 to 4.8% in 2021, thanks also to the launch of lines such as Studio Collection (with embroidered coats) e Zara Originssynonymous with timeless pieces.

In the case of the Swedish company, the weight of the premium assortment has gone – in the same period of time – from 5.49% to 5.6%, with an ever stronger focus on collections such as Conscious Exclusive o Innovation Circular Design Story (in the picture).

The increase in price lists mirrored this upward evolution: in 2021 the average price of high-end garments by Zara it went up by 19%, to 60 euros (compared to the average of 33 euros in the rest of the offer).

In the case of H&M, the increase was smaller, by 3.2%, although the pieces are generally higher, on average 66 euros, compared to 24 euros for the rest of the items on sale.

For both chains these are therefore considerably more expensive collections than the rest of the catalog: in the case of Zara the differential is 83%, while for H&M it reaches 173%.

Moreover, it should be considered that the fabrics used to make this type of products are of the highest quality: for both groups in 2021 there is a greater use of cashmere (+ 0.36% for Zara, + 0.54% for H&M) , wool (+ 2.26% for Zara, + 1.74% for H&M) and leather (+ 3.98% for Zara, + 0.82% for H&M).

Not to mention that, from Sweden to Spain, the sustainable fashion segment is growing, which obviously has an impact on prices: in 2021, the eco-friendly share of H&M represented 21% of the total offer, while the Join Life of Zara covers 16% of the entire assortment.

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