At the New York City Abercrombie & Fitch store, whose neighbors include Prada and Gucci, a shirtless male model greets shoppers at the front and happily snaps pictures with the gawkers. Sales associates dance to hip-hop music in the aisles. There's not one "For Sale" sign in the whole four-story place. A pair of men's ripped jeans go for $90; women's jeans are $80; a hooded sweatshirt with the Abercrombie logo is $60.
Time Magazine
Time Magazine is reporting that the once mighty Abercrombie & Fitch has done the worst job of any other retailer in America in navigating the economic recession. Ouch.
Following a strategy that once the recession is over consumers would once again be willing to pay a lot of money for it's aspirational brand, Abercrombie decided to do what no other retailer has done -- it hasn't lowered its prices during the recession. On top of that, the Abercrombie look is no longer the fashion rage.
When you put no bargains and fashion-backward together you get a company that is experiencing some major losses.
After releasing second-quarter earnings on Aug. 14, Abercrombie CEO Mike Jeffries admitted that the company missed some spring fashion trends. He said he plans to cut prices more aggressively. (The company did not respond to an interview request.) He might also want to change the Abercrombie vibe, which seems pretty tone-deaf to the times.
Meanwhile, there is some research out there that indicates the days of wanting to spend a lot of money on aspirational brands may not return as fast as Abercrombie needs them to. The Time Magazine articles says that only 40% of men and 28% of women say they will spend at high-end clothing stores again which led the researcher to say, "Abercrombie keeps working to protect their brand," says Beemer. "But when you keep seeing 30% sales declines, you're going to protect your brand into oblivion."
Image Credit:NYC ♥ NYC
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