Abercrombie & Fitch: Smart Marketing Or Just Selective?
By Alicia Fiorletta, Associate Editor
Abercrombie & Fitch CEO Mike Jeffries has developed quite a reputation for saying scandalous — and at times callous — things to the press. But this time, he has come under fire for an interview he gave almost seven years ago.
This goes to show that nothing dies online. Articles, photos and interviews remain in the “web-o-sphere” for years on end, so any party can reach in and grab it for future use.
This is exactly what happened to Jeffries: Grabbing quotes from an article published by Salon.com in 2006, a new book from Robin Lewis, titled: The New Rules of Retail, has caused a stir online. Now, many digital publications are referring back to the Salon article to spotlight Abercrombie & Fitch’s refusal to cater to the “everyday woman.” There even is an online petition on Change.org, encouraging the retailer to extend apparel to “people of all shapes and sizes.”
During Jeffries’ reign as CEO (he joined the team in 1992), Abercrombie & Fitch has refused to sell women’s jeans above a size 10. In addition, size XL tops are not available in the women’s section. But he insisted that this is just a part of the Abercrombie brand.
“In every school there are the cool and popular kids, and then there are the not-so-cool kids,” Jeffries said in the original interview with Salon.com. “Candidly, we go after the cool kids. We go after the attractive all-American kid with a great attitude and a lot of friends. A lot of people don’t belong [in our clothes], and they can’t belong. Are we exclusionary? Absolutely. Those companies that are in trouble are trying to target everybody: young, old, fat, skinny. But then you become totally vanilla. You don’t alienate anybody, but you don’t excite anybody, either.”
Jeffries makes a solid point that to succeed, retailers need to identify target audiences and engage with them appropriately. However, it is important to note that there is a severe double standard for the brand’s merchandising and inventory strategies: men’s t-shirts are available up to size XXL. No doubt, these options are provided to athletic male customers who have bulging muscles to tame. (Abercrombie & Fitch’s target consumers are extremely athletic males.)
As someone who used to be overweight, my blood boiled over Jeffries’ remarks. Automatically, my brain went back to the years when I couldn’t buy the clothes I wanted, or was forced to settle for a piece of clothing only because it fit correctly.
Once my blood pressure returned to a normal level, though, I couldn’t help but think: Would I feel differently if his approach or explanation were a little more professional and not as blunt? After all, it is every retailer’s goal to attract and acquire target customers, and turn them to loyal buyers. That’s just the business of doing business.
This trail of thought inspired me to Google like a madwoman: I wanted to learn more about the Abercrombie & Fitch brand, Jeffries, the scandalous interview, and more importantly, how others were responding to his business and branding perspectives.
I came across a recent discussion on RetailWire, which allowed retail analysts and experts to weigh in on the situation. “Niche marketing” was a common theme among respondents.
“I think it certainly helps Abercrombie & Fitch’s reputation because it’s the reputation the retailer wants to have,” said David Livingston, Principal at DJL Research. “It’s niche marketing. Abercrombie & Fitch is simply going after a certain demographic.”
However, Dick Seesel, Principal at Retailing In Focus, indicated that Jeffries’ comments come from an era when Abercrombie & Fitch was on a high pedestal. The retailer has been facing a series of struggles since the economic downturn, and its overall brand image and stance in the retail space has diminished.
“Abercrombie & Fitch has yet to recover from its pre-recession heights, and it is notable that the quotation attributed to Jeffries dates from Abercrombie’s glory days in 2006,” Seesel stated. “The company made a series of missteps, from its poor value positioning during the recession, to more recent product development missteps. Jeffries’ insistence that the larger teen customer is not for him may be consistent with Abercrombie & Fitch’s brand position, but it is not a good long-term business strategy.”
Other retailers have seen success since introducing plus-sized clothing into their assortments. For example, Hot Topic has improved bottom-line results since launching Torrid, the plus-sized fashion brand. According to Q1 2013 results, Hot Topic net sales for the quarter increased 1.9% year over year to $174.8 million, largely due to robust sales at Torrid stores.
“Management believes the success of the company’s Torrid store concepts, through new Torrid branding and vertical product strategies has strengthened the brand’s unit growth opportunity,” a company press release stated. Overall, Torrid stores registered a 10.7% increase in sales from 2012 to 2013.
Additionally, American Eagle (a top competitor to Abercrombie & Fitch), Forever 21 and H&M, all have introduced plus-sized sections to their stores. I would love to see more detailed information on their sales results, and whether offering plus-sized options played a role on any revenue boosts.
In 2006, Jeffries stood by his claim that excluding plus-size options has helped the brand skyrocket to a higher, more coveted status than other brands. By ignoring such a tremendous segment of the U.S. — and even the world — the retailer has seen positive sales results. But in this day and age, where consumers have so many options, I can’t help but question this position.
Consumers — especially younger ones — are becoming more adventurous in the ways they dress, and are buying from a greater variety of brands and retailers. There are no rules in the new fashion world, and you certainly don’t have to wear a big “A&F” logo on your shirt to be seen as cool.
Readers, what do you think? Were Jeffries comments simply niche marketing in action, or is his strategy backfiring?
(Image courtesy of NetBase)
Follow Alicia on Twitter: @AliciaFiorletta
Conquering Seasonal Sales
By Nick Sprau, VP of sales and marketing at Metafile Information Systems
The holiday shopping season may be long gone, but with numerous special occasions such as Valentine’s Day, Mother’s Day, and graduation season occurring year-round, retailers regularly anticipate the boost increased sales from gift giving will contribute to the bottom line.
While these seasonal sales provide a great increase in revenue, the success of peak selling seasons relies heavily on the effectiveness of the internal financial process and the accounting department’s ability to handle the increased number of invoices and financial data. Customer demand and consistently moving inventory can place a significant strain on AP and AR departments and supply chain as they manage the financial and logistical implications of increased sales.
The heavy flow of invoices makes AP/AR automation essential to coming out on top. It is imperative your staff has the ability to quickly capture, analyze and react to data in order to increase sales and influence how your business can save money in the long term, while also adding order and full visibility to the overall financial process. Equipping your financial department with the right technology will enable them to successfully conquer the busy period and best manage resources.
For large retailers with multiple locations, managing the influx of information from affiliates and suppliers can cause untimely delays in productivity and sacrifices the AP department’s ability to process invoices and provide key insights in purchasing trends. However, AP/AR automation through technology solutions not only helps in identifying trends, but also can prevent being blindsided by errors that often accompany manually processing invoices. Web-based solutions allow accounting departments and other key stakeholders to receive electronic versions of paper invoices with equal ease from locations across town or those across the globe.
Technology has provided a solution that is helping retailers master efficient invoice processing and offers the ability to scale during seasonal upswings. While automated accounting technology may not be top of mind for many retailers, it’s vital to maintaining healthy workflows, and positions multi-location, decentralized organizations for success throughout the year.
Nick Sprau is VP of sales and marketing at Metafile Information Systems, a paperless ERP solutions provider for accounts payable, accounts receivable and human resources document management and workflow technology.
Snippet of Associate Editor Alicia Fiorletta’s previous blog post.
In my opinion, the video and social strategies utilized during NYFW confirms a new reality for the retail world: More brands and designers are taking note of social media’s impact on increasing awareness, buzz and loyalty. They now understand that in order to be seen — and shared — among consumers, they must provide the access and resources to encourage and enable social conversations.
Read the entire post here: http://rtou.ch/WrRx4H