Pinned straw:
Harli and Harpa (H&H) Competition
The H&H website is now live, presenting a clean and polished look. (FYI, it wasn't up when the first stores opened) It’s hard to find on Google due to name spelling variations, this should resolve as brand recognition grows. Their Instagram following is currently (2.3k), Lovisa's (461k), a metric worth tracking to gauge customer interest.
Product Range
The product range looks good, and I've changed my mind about the target age bracket (re my comments post LOV agm). After reviewing the website, I feel the product is more suited for an older customer base, 20-25+ and easily caters for a much older market too. To me, the product range appears more "mature" than Lovisa's offerings at this point.
Price points & SKUs
H&H's price points cover a broader range than Lovisa's, with products priced up to $200. Could this wide range potentially confuse customers about the store's target market positioning or is it a product fit test to see what works? Monitoring these price brackets going forward will help define where their market sits. For reference, Lovisa's highest price point is $75, with a total of 40 SKUs between $50-75 out of 6.4k+, so the bulk is well under $50. (ref: aust site)
Here's a breakdown of H&H's wristwear category, as per website 4/12/24
I've attached a comparison of a $200 bangle next to a $30 one, this is how it came up on the website. This price disparity might be confusing for customers, though the quality difference may be more apparent in-store. TBC
Product items by Major Categories as per websites, 4/12/24, (Note: This total doesn't capture all SKUs, especially for Lovisa, which has many subcategories.)
Bridal Category
The bridal category comparison was particularly interesting. H&H features it as a main menu item, with appealing product styling. Lovisa's bridal section, is hidden under "occasions," appears less attractive and to me looks "cheap" in comparison: no one wants to feel cheap when buying wedding jewellery. I think this could be a lucrative sub-category within the business.
Photography
A side-by-side product search for silver hoops revealed significant differences in image quality between Lovisa and H&H websites. Lovisa's product shots are arguably unacceptable for an online store. I suspect the images are being provided by manufacturers to accommodate their fast product turnover. While photographing small, reflective items on a tight budget is challenging (good jewellery photography is difficult and expensive), there's room for improvement in Lovisa's imagery. Enhancing photo quality could potentially boost online sales, maybe? This raises the question: what are the implications of trying to develop an online presence in China with subpar images? The flip side is it's perhaps this comment on product photos is misplaced, given that in-store sales remain the main driver of Lovisa's business. A focus on the important part of the business?
Store count
H&H currently has 11 stores open across VIC, NSW, and QLD.
Conclusion
My current thoughts, which are subject to change are that the H&H product is targeting an older customer than the Lovisa store. Side by side, the H&H website feels more luxurious and is easier to navigate and find items, although this is probably a reflection of the smaller number of SKUs available. Has Lovisa's ranging become too broad and less specific/targeted?
In contrast, Lovisa's site feels cheaper, this is partly due to the current Cyber Monday marketing, which is loud and in your face. At different times, the presentation has been "classier" so take this comment with a grain of salt.
Obviously, we need a lot more time to really see how H&H and LOV compete head-to-head, or if they are they actually targeting slightly different markets, with clear overlap in some areas but perhaps not all?
I'll revisit this after I have a chance to visit a store, (no idea when I’m next in Melb) and see if the online experience matches the in-store experience. I'm also v interested in accessing the quality of the product.
Store-Product Feedback
It would be great to get wider feedback on customer insights on Lovisa and H&H stores & product. So if you, your wives, daughters, or other family members have shopped there, I'd love to hear their thoughts on:
- Product, store layout & atmosphere
- Customer service
- Anything really, all feedback is valuable, esp from real consumers
Thanks
held
Funnily enough, while at the local shopping centre on the weekend I did a little Peter Lynch boots-on-the-ground research. I was with the wife, so much the following qualitative points are her thoughts (I know nothing).
- The store is significantly larger than Lovisa. Maybe 2-3x the size of the Lovisa store in the same shopping centre. It's more open and less cramped. There's 3-4 people serving the store vs 2 people at Lovisa.
- The staff are a lot more professional. Groomed, black uniforms, proactive and professional customer service. I've been into Lovisa a couple of times with my nearly 4yo daughter - the staff are very casual 16-18yo first job types with low levels of customer service from my experience.
- Most pieces are very affordable ~$15 range. It's fast fashion. Gold plated pieces - it's going to rub off over time. But it scales up more than Lovisa - to pieces with more gold and up to necklaces with lab gems that are $400/piece.
- Lovisa skews younger. There's definitely a young girl range - unicorn hair thingis, rainbow colour necklaces, etc.
- There's definitely a large overlap between the customer base. We saw two 12-13yo girls buy items from both stores. We asked them what they liked about each store - they mentioned one had more necklaces and the other more earrings, and we driven by the sales they had.
- My wife came away thinking Harli + Harpa had a much better customer proposition. Having said that, she's not in the target demographic of either store. And the investment case needs to weigh up rent, employee costs, profit margins vs the revenue they bring in.
I would say however, Lovisa definitely has some competition here.
