Recently H&M announced that they will have a forthcoming collaboration with Balmain which is a well-known luxury brand and focus on high-end dress.

H&M as a fast-fashion brand always have the comparative advantage of good-quality but cheap clothes, the target customers of H&M are women around 16-35, and it is the favourite brand among the college female student including me. Balmain is a high-end brand and the target customers are people with higher salaries and more disposable income than H&M customers.

Such two different companies with different value propositions and customer segments, why would they decide to come out a forthcoming collaboration?

In my opinion, H&M decided to do that because the fantastic design and wonderful idea of Balmain; Balmain decided to do that because the broad market H&M has and the potential customers who couldn’t afford Balmain but can afford a little “expensive” H&M. Furthermore, the previous success of H&M x Alexander Wang gave both of them confidence that the clothes will be sold out immediately.

This cooperation between H&M and Balmain shows the win-win when two companies change their value proposition for catering to taste of majority customers.

Sources:
H&M and Balmain campaign

There is no doubt that Apple is the hottest and most potential company in the planet, every time when Apple release a new product, it will cause attention of the whole world.

But why people choose Apple and what makes Apple so different? The answer is Apple is not only produce the hardware such as iPhone, MacBook and iWatch, the Apple Inc. but also a combination of the hardware company, the software company (the IOS system), the services company (Siri), and the retail company (Apple Retail Store). This makes Apple so unique because other companies only made one or two of them. Take the competitor of Apple, Samsung, as an example, Samsung produce the hardware only, then put Android System on it, use Google as service company and sell it via Retailed Stores like BestBuy.

Apple is the only company which gathered these four parts together, it is a vertical integration, so it’s controlling the whole pace of the selling experience and it’s better for Apple to carry through Apple’s approach to products is that they are at the union of liberal arts and technology.

The combination of vertical integrated products and the simplified design is the reason why Apple is so successful.

Sources:
Why Competing with Apple is so Difficult