H&M may be in the fast-fashion business, but the company has been painfully slow in launching an e-commerce site here in the U.S. The chain finally went live with its site (www.hm.com/us) today with low prices ("Must Haves From $4.95") and a limited free shipping offer for those who sign up to receive its e-newsletter.
The chain has been on a fast track with store openings in the U.S., but has been criticized for not getting its e-commerce act together and falling behind rivals, from Amazon.com to Zara. A RetailWire poll in September of last year found that 66 percent thought that e-commerce was important to H&M's growth prospects in America.
For its part, H&M management has always insisted on getting its site right rather than getting it online fast. The Wall Street Journal cited a recent interview with Nils Vinge, head of investor relations with H&M, who discussed the complexity of operating an online site in the U.S. "We couldn't just copy and paste the online shops that we operate in Europe ... our volumes are so large," he said.
There remain concerns about whether H&M can profitably manage a U.S. e-commerce site.
"H&M is low-price, quite low-margin and makes it work by selling very high volumes. An issue with that is very high costs for shipping and, most significantly, returns. It's a particular problem in the U.S.," Neil Saunders, a consultant with Conlumino, told Reuters. H&M intends to charge for returns, a potential deterrent for online purchasing.