Hermès SWOT Analysis
Here is a detailed SWOT analysis of Hermès covering strengths, weaknesses, opportunities and threats.
SWOT analysis is a management strategy framework used by businesses like Hermès for assessing organization’s Strengths, Weaknesses, Opportunities, and Threats to guide strategic decision-making. Hermès by Thierry Hermès is a French high fashion luxury goods manufacturer and started with producing saddle in 1837. Presently it has several product divisions specializing in leather, ready-to-wear (men & women), lifestyle accessories, footwear, gloves, scarves, ties, perfumes, jewelry, watches, stationary and home furnishings. By examining these internal and external factors, Hermès can capitalize on advantages, mitigate risks, and chart a more competitive path forward. Hermès has an annual sale of $7 billion composed of about 30% leather goods, 15% clothes, 10% scarves, and 40% other wares and employees 10,000+ people worldwide. Let us start the SWOT Analysis of Hermès below.
Hermès Strengths
- Hermès is a French company with a strong brand name and global presence
- Hermès markets its products across the world through a network of 300+ exclusive stores of which 180 are operated directly
- The company principally operates 30+ production units across France, Japan, Europe, the Americas and Asia-Pacific.
- Good presence and wide product range of luxury goods on offer
- There are more than 10,000 people employed with Hermès International company
- Apart from clothes, Hermès offers luxury watches, jewelery, perfumes etc.
- The company has worked some of the world's most well known designers
- Strong branding and marketing through online ads, print media, digital marketing and social media
- Hermès products are available online via the company website as well as leading ecommerce stores
- The annual revenue of the company is more than $7 billion
- Since Hermès bags are handmade, there is an exclusivity in the value offered by the brand
Above are the strengths in the SWOT Analysis of Hermès. The strengths of Hermès looks at the key internal factors of its business which gives it competitive advantage in the market and strengthens its position.
Hermès Weaknesses
- Intense competition means limited market share growth for Hermès
- Fake imitation of the brand affects its business and hurts brand value
These were the weaknesses in the Hermès SWOT Analysis. The weaknesses of a brand are certain aspects of its business which it can improve.
Hermès Opportunities
- Hermès can try to expand its market globally to tap customers
- To use the digital revolution to its full advantage and expand its business online through ecommerce
- The brand can focus on advertising to increase brand recall
- Acquisition of smaller luxury brands can enhance the company's position
Above we covered the opportunities in Hermès SWOT Analysis. The opportunities for any brand can include prospects of future growth.
Read more about Hermès
Hermès Threats
- Intense competition means reduction of Hermès market share
- Ease of substitution as many options available to the customer
- Imitation & replica products is the biggest threat in this industry
- Being a global brand, recession and economic instability affects its global operations
The threats in the SWOT Analysis of Hermès are as mentioned above. The threats for any business can be external factors which can negatively impact its business.
Hence this concludes the Hermès SWOT analysis.
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About Hermès
The table below gives the brand overview along with its target market, segmentation, positioning & USP
| Hermès Overview | |
|---|---|
| Parent Company |
Hermès International |
| Category |
Apparels and Accessories |
| Sector | |
| Tagline/ Slogan |
A sporting life; Time on your side |
| USP |
Hermès offers a wide range of premium leather products, perfumes, shoes, clothes etc. |
| Hermès STP | |
| Segmentation |
People looking for premium stylish clothing and accessories |
| Target Market |
Urban upper middle class men and women |
| Positioning |
Hermès is a high end luxurious fashion clothing and accessory brand |
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