Back on trend? H&M makes AI, loyalty drive to ride fashion cycle
Back on trend? H&M makes AI, loyalty drive to ride fashion cycle
https://www.aol.com/back-trend-h-m-makes-ai-loyalty-drive-154952131–finance.html
Publish Date: 2026-04-19 08:41:00
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By Emma Thomasson and Anna Ringstrom
BERLIN/STOCKHOLM (Reuters) – When H&M boosted its shares last month by reporting a rise in the sale of full-price garments, it wasn’t just a tribute to the fashion sense of its designers. It was a sign that backroom improvements are at last paying off.
The world’s second-largest fashion group is investing heavily in areas like artificial intelligence and customer loyalty as it looks to improve the way it spots trends and plans logistics, and ultimately reduce discounted sales and piles of unsold stock.
Arti Zeighami, H&M’s head of advanced analytics and artificial intelligence, told Reuters the strategy is starting to bear fruit as the company extends pilot projects that seek to use data to match supply and demand more closely.
“Allocating the right goods to the right stores in the right markets is one of the key projects we are working on,” Zeighami said. “For 2019 we have huge plans for growing that and hopefully, by the end of next year, covering globally.”
In the age of social media, fashion companies have less power to drive trends, which come and go much more quickly as influencers promote their “outfit of the day” on Instagram.
That poses a particular problem for H&M, which produces most of its garments in Asia, far from its major markets, making it less responsive than its rival Zara-owner Inditex which boasts it can get new designs to its stores within a week.
Sportswear brand Adidas admitted last month it had been caught flat-footed when its suppliers failed to keep up with strong U.S. demand for its mid-priced clothing ranges.
H&M had seen stocks of unsold goods pile up over the past three years.
IMPROVEMENTS IN BUYING
In the quarter through February, inventories grew to 40 billion crowns ($4.3 bln), or 18.6 percent of sales, but H&M said they consisted of a higher share of clothes that are newer, thus less likely to be sold at marked-down prices. It has said this is a sign its overhaul is working, and it expects a…
