Product, Pricing, and Channels Paper

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Product, Pricing, and Channels Paper H&M online Since 2009 there has been a large decrease in offline retail sales, by 2015 Gap Inc. will be closing 189 store, Abercrombie and Fitch is planning to close 180 store and Aeropostale 175 stores (Business Insider). JCPenny’s store sales alone dropped 31.7% in store purchases (Business Insider). Where are consumers going? Online. In 2013, the top online purchases for U.S. consumers were consumer electronics, books, clothing and apparel, 63% customers prefer to purchase clothing and apparel online. Ecommerce is one of the fastest growing markets in the world. Currently the United States is the largest online retail market. Based on the statistical data, retail e-commerce back in 2012…show more content…
At launch the prices could vary depending on the style, and quality of the product. Prices will also be fixed based on the products individually. For shirts the price range could be average of 10$ to 25$ before taxes. For pants the price range could be average of 17$ to 35$ before taxes. The term “you get what you pay for” comes in effect when dealing with the clothing industry. If consumers want high quality products than they have to pay quality money for it, if consumers want low quality products less money they will have to pay. The launch price listed helps H&M online product compete with any other online clothing industry that’s out there, while helping H&M organization increase their supply and demand. Channels of Distribution The channels of distribution that H&M Online will use can be seen through internal processing of online purchases through the direct online store, as well as "Drop shipping." Drop shipping is a technique used where the retailer does not keep goods in stock or portions of it in stock and transfers the orders and shipment information to the manufacturer directly or a wholesaler who then ships the ordered products directly the customer. Having multiple avenues of distribution of the products greatly increases profit and also means of delivering high quality products from multiple avenues. The only down side to having drop shippers, is that it can come with a cost. Having third party

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