The Business Strategy Behind The H&M x Balmain Collaboration.

Balmain and H&M are two very distinguished fashion companies, in terms of their pricing, customer profile, product quality and company size. Thus, it seemed unnatural that the two collaborate on a collection.

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After identifying itself as a high-fashion brand, wouldn’t a collaboration with H&M ruin Balmain’s reputation? Some argued the collaboration stained the brand’s credibility whereas others rejoiced to the fact they could finally afford an item associated to the Balmain name.

And both reactions are completely understandable. Previous owners of Balmain pieces should be annoyed that others are getting Balmain products for cheaper, and that the luxury value of Balmain clothing decreases.

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But the move for Balmain makes perfect sense.

Balmain and H&M x Balmain are two different brands just as Giorgio Armani is differentiated from Emporio Armani, Armani Exchange and Armani Jeans. Furthermore, many other high-fashion brands have collaborated with H&M in the past including Lanvin, Versace and Maison Martin Margiela. These are strategies luxury retailers have had for years to diversify their products and appeal to a broader spectrum of consumers. It is important to preserve the name of the brand and keep intact its reputability in terms of craftsmanship and quality, but profitability for most of these brands comes from the regular consumer.

You also have to remember that the clothing Balmain sells doesn’t necessarily appeal to all ages. Their targeted audience would range from ages 18 to 25 which, financially, is not the consumer who would typically spend his money on luxury clothing. With a reputable name like Balmain, and now a collaboration that would make the clothing more affordable, the incentive for consumers to purchase skyrocketed. No one wanted to miss this once in a lifetime opportunity. And this was also due to the ad campaign.

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Backstreet Boys performing at the fashion show in New York

The marketing campaign was something we’ve never seen before. The fashion show in New York was more of a fashion performance featuring supermodels Kendall Jenner and Gigi Hadid as well as a performance from the Backstreet Boys. The campaign also utilized celebrities and social media as much as possible resulting in high awareness of the new collection. It was a truly modern and unprecedented way of diffusing a limited collection to the masses.

Screen Shot 2015-11-23 at 6.41.54 PMBenjamin Kattan

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