H&M's newest brand Arket to open its doors in London this fall

London - Swedish fast-fashion giant H&M Hennes & Mauritz AB shows no signs of slowing down or fear of competition as the group has announced the launch of a brand new retail brand: Arket.

The announcement comes as the H&M Group revealed a 7 percent sales increase in its first quarter sales to 28 February 2017, and few months after initial speculation first emerged that the fashion group was preparing to launch a new label. Named Arket, the new label is set to open its first store on Regent Street in London sometime in early autumn this year. The move sees Arket following in the footsteps of big sister brand COS, which first launched on Regent Street a decade ago, as the H&M Group hopes to recreate COS success under a new formula.

H&M Group unveils brand number eight: Arket

"Ten years ago the first COS store opened, and since then we have added a number of new brands to the H&M group. Each with its own unique profile, our brands attract customers in various different segments," said Karl-Johan Persson, CEO of the H&M Group in a statement. "We are now looking forward to launching Arket after the summer this year." Arket is set to offer a wide, yet selected range of "essentials for men, women and children" in addition to a smaller curated collection of items for the home, similar to the style of H&M.

"A fantastic team with diverse backgrounds and areas of expertise have come together to build Arket. We’re very excited to soon reveal the brand and share our collections with customers"

However the debut brand aims to offer simple, yet timeless and functional designs, focusing on materials used, function as well as fit. The modern products are set to sit within a "broad price range", which is in a "slightly higher price segment than H&M" added the Group, due to the focus on materials. Arket means ‘sheet of paper’ in Swedish. "It both relates to our origin in the Nordic tradition of functional, long-lasting design and symbolises the blank sheet, the sense of optimism and possibility we felt creating this new brand," explains Ulrika Bernhardtz, Creative Director in a statement.

Arket stores will offer both the brands collections, as well as a selection of external brands which are not part of H&M Group, similar in style to a concept store. In addition Arket Stores will also include a cafe - where location permits stresses Persson, to offer consumers an new shopping experience. The in-store cafés will be based on the 'New Nordic Kitchen' concept, which focuses on offering consumers quality ingredients while promoting healthy living.

Arket to open debut store in London this fall

The debut Arket store is set to open its doors in London and will launch online in 18 European markets in early autumn 2017. Afterwards the H&M Group aims to roll out ARKET to neighbouring leading cities, including Brussels, Copenhagen and Munich. “We have seven brands today – H&M, COS, & Other Stories, Monki, Weekday, Cheap Monday and H&M Home – and soon it will be time for our next exciting launch, Arket," said Persson.

Arket's launch comes as the global fashion sector continues to push through a turbulant time. "Retail is going through a challenging period of change in which customers’ shopping behaviour and expectations are changing at a fast pace as a result of growing digitalisation," added Persson. "This is an accelerating development which also brings great opportunities." At the moment H&M remains the Swedish fashion group's largest brand, present in 65 markets across the world and most succesful brand. However in order to ensure the group's addditional brands continue to thrive, Hennes & Mauritz needs to makes sure it expands both its new and established brands into new markets while tackling competition in mature markets.

"The announcement of H&M’s new brand Arket comes at an interesting time," commented Bernadette Kissane, apparel and footwear analyst at Euromonitor International. "While the company has been teasing consumers with the potential launch of a new brand for a while now, the concept of Arket is quite unlike anything we’ve seen from the company before. The company’s results have been falling short of expectations recently, consistently outpaced by key rival Inditex and illustrated in its latest annual report."

"Rather than adopt a faster sourcing strategy to compete, the company has opted to introduce new brand Arket to effectively cater to shifts in consumer behaviour, while simultaneously making progress towards the company mission to develop a more sustainable business model... Perhaps more interestingly, is the company’s decision to host third-party brands in store, aiming to create a convenient shopping experience for time-restrained consumers," continued Kissane. "On paper this new shopping format sounds promising, taking into consideration the rapid shifts in consumer trends and fashion retailing, and may well provide H&M with the leverage to gain back some lost market share."

Photo: via H&M