In a press release, the companies said that with the deal customers will get a more personalized shopping experience, whether that’s in a physical store or online. Under the deal, Klarna will power H&M’s Club payment program, provide an omnichannel customer payment offering, give customers a streamlined post-purchase service as part of H&M’s mobile app and other yet-to-be-announced services. The idea is to make it frictionless for customers to make purchases — whether in-store or over the internet — including mobile and online payment choices, simplified deliveries and returns and flexibility in how and when to pay, including a try before you pay service. The features will be integrated into the next iteration of the H&M app and H&M Club, the companies said in the press release. It is expected to be live in 2019 across all of H&M’s 14 markets, with the U.K. and Sweden in the first phase of deployment. H&M is also making an investment of $20 million in the payments company, according to reports. The companies aren’t saying what Klarna’s valuation is after the investment, but sources said $20 million is “much less than one percent of the company.”
“We are impressed with what Klarna has achieved to date, and now we will work together to elevate the modern shopping experience. This strategic partnership between H&M group and Klarna is based on a joint relentless focus on creating great customer experiences,” Karl-Johan Persson, CEO of H&M group, said in the press release. Meanwhile, Sebastian Siemiatkowski, CEO and co-founder of Klarna, noted in the press release that the retail market is changing again with the future of fashion retail focused on technology. “Regardless of how and when customers want to shop, we need to be there for them. Customers will no longer be forgiving of unnecessary complexity or when their retail experience does not leverage the insight available to make their engagement smart, personal and easy. This partnership is rooted in a shared obsession about just how good that shopping experience should be. Together we have worked hard on developing a unique solution for in-store and online that will delight customers, drive economic value and build loyalty,” he said.